Rob Ford, you fantastic son of a bitch!
You found the gravy! How does it taste?
“How Does A $774 Million Deficit Become A $90 Million Surplus?”
By: Elizabeth Church
The Globe & Mail
How did a $774-million hole in the city’s operating budget become a $90-million surplus?
Toronto is expected to finish the year with $90-million to spare. Just a year ago, Mayor Rob Ford’s administration was issuing dire warnings about the need to cut costs in order to plug a $774-million funding shortfall in the city’s 2012 budget.
Councillor Doug Ford says the extra money shows his brother the mayor’s austerity efforts worked.
“Through efficiencies we found savings, through labour contracts and throughout the whole system,” he said. “Anyone when we first got elected who said where’s the gravy? We’ve proved in 18 months where the gravy is and there’s barrels of gravy still down here.”
Councillor Gord Perks, a critic of the mayor, says the massive budget swing shows the Ford administration inflated the budget shortfall in order to justify shrinking government. “The budget chief was exaggerating the size of the hole so he could scare Torontonians into accepting cuts,’ he said.
Toronto chief financial officer Cam Weldon, says the city is close to balancing its budget – something he defines as when it no longer needs to dip into reserves to cover operating expenses. The city’s debt for capital projects continues to increase.
Council took $100-million from reserves to use for the 2012 budget, but now that same budget is expected to have a $90-million surplus – just $10-million shy of balancing. “We are working on getting that gap closed for 2013,” Mr. Weldon said.
Mr. Weldon’s back-of-the-envelope summary of Toronto’s 2012 budget shows the $774-million gap was reduced through a combination of savings and new revenue. Service cuts and cost reductions added up to $329-million. Increasing fees, TTC fares and other revenue sources as well as taxes brought in another $345-million. The rest – $100-million – came from reserves.
FOLLOW THE MONEY
The challenge: $774-million budget gap
How they got to zero:
Expenditure reductions: $271 m
Service adjustments: $58 m
Revenue increases: $258 m
Tax increases: $57 m
TTC fare increase: $30 m
Money from reserves: $100 m
How they got a surplus:
Expenditure savings $19 m
Labour savings $26 m
Other: $1 m
Higher-than-expected land transfer tax: $44 m
End result: $90-million surplus
The single-greatest part of this story is not even up for debate. It’s this line here from the lesser-Ford:
“Anyone when we first got elected who said where’s the gravy? We’ve proved in 18 months where the gravy is and there’s barrels of gravy still down here.”
I’m sorry, did you say “barrels of gravy?”
We’re not drilling for oil here. Barrels? Really?
Barrels of gravy. Well, I guess in the Ford household growing up, that’s just what they called “supper.”
I kid, I kid!
You all know I’m a Ford supporter, in the same way I’m a Maple Leafs supporter. Wait….or is it the complete opposite? I think I got lost in my analogy here…
I have two questions to ask of my readers here:
1) Do you believe the Fords or do you agree with Gord Perks?
Do you think the savings, er “gravy findings,” are genuine? Or were we all misled by an inflated budget that suggested a $774 Million shortfall, only to be rescued with two pieces of white bread to sog up all that gravy?
Politicians are use to throwing mud (or gravy) at each other, so I’m not surprised that Gord Perks, instead of saying “job well done,” is kicking this gift-horse in the mouth and crying foul. I’m actually surprised that others didn’t chime in too! Adam Vaughan, Kristyn Wong-Tam – why so quiet?
2) Play Mayor for a moment: where would you spend the $90 Million surplus?
What can we accomplish with $90 Million?
a) repeal the land transfer tax
b) restore funding to parks and recreation (sports fields, pools)
c) spend the money on roads
d) re-open the libraries (wait….isn’t the Internet free?)
e) hire back some city workers
f) save it for a rainy day
I’m sure there are other options but for the purpose of this game, those are the only ones. Ugh, okay fine:
g) “other”
Happy?
Well, as a kids baseball coach, having heard that next year, the city might charge money for the use of the field (effectively shutting baseball down altogether), I’d like to see more money put back into the communities, but I’m being selective and biased, since I would probably scoff at the notion of opening one cricket field for every new hockey arena. Don’t yell at me – I just said I’m biased!
Of course, I’d love to see the land transfer tax repealed, but that might be seen by critics as “propping up” the real estate market. It’s getting very expensive to transact in real estate in Toronto, since buyers are being taxed DOUBLE by the province and the city, so repealing the tax, which was unfair to begin with, which was promised by our Mayor, might be a step in the right direction.
With all due respect to Margaret Atwood, I’m not so moved by the unfortunate library closings. I wish kids today read books, or even knew what they were, but this generation is a lost cause, and a “book,” which is one of the oldest possessions in the history of mankind, is on the way out. The library of the future will be the size of a hot-dog stand and have one port for charging your I-Phone, and another for charging your Kindle…
How about more bike lanes? Yeah, I know…
Or how about, “I don’t really trust what’s going on at City Hall right now, and I don’t believe any numbers that are reported, let alone anything that comes out of anyone’s mouth. Keep the supposed ‘surplus’ for three weeks from now when the next crisis happens, or when the next scandal hits, and let us know how it all turns out.”
I think I’m going to go with the last one.
All these reports and all these “findings” are about as reliable as the people we elect to look after our city…
Geoff
at 9:35 am
“With all due respect to Margaret Atwood, I’m not so moved by the unfortunate library closings. I wish kids today read books, or even knew what they were, but this generation is a lost cause, and a “book,” which is one of the oldest possessions in the history of mankind, is on the way out. ”
My son (4) is not a lost cause, jackass.
David Fleming
at 11:06 am
@ Geoff
I’m not saying YOUR son is a lost cause.
But the teenagers that I’ve coached, every year, for the past six years, would never walk into a library.
I’m wondering if the world is changing enough that (gulp!) libraries are obsolete? Like VHS cassettes and 8-track tapes?
Jeremy
at 11:39 am
David,
With all due respect, the kids you have coached are not a random sample of the general population… these are teenage jocks! In Leaside! I played every sport in high school, and it would not have been cool to talk about what books I was reading.. glad to see some things never change.
But Have you been to a library lately? They are all very crowded, with many young people, especially in the poorer neighbourhoods. I don’t think books are going anywhere, anytime soon.
Tyson
at 12:48 pm
I just graduated from the University of Guelph with an Honours Bachelor of Commerce, majoring in Real Estate and Housing. You know how many books I read in 4 years? The odd cool economics book I bought from Chapters, and parts of the text, and I like to think I’m a pretty smart guy. Know how many books I took out of the library? Zero. Not a one. The young people are there using the tables for projects and group work, not for reading novels and magazines. I don’t know but a few kids my younger siblings’ age that would consider a trip in. And they’re in elementary and high school. Libraries are certainly lost on them.
JC
at 3:31 pm
I don’t think they’re obsolete. Not by a long shot. I know many parents of kids under the age of 12 that go to the libraries at least once a week. They are trying to keep their kids away from the junk on TV as much as possible and so far – they love reading.
Perhaps some of this “surplus” that has been found can be put back into funding for schools. Not having kids of my own, I had no idea that many schools in the “inner” city are having a great deal of trouble since their budgets have been cut. In the past week, I’ve been to two fun fairs to raise $ for schools so that they’ve got funds to buy white boards and other supplies. Funds received through the city are ridiculously low.
Yes, the city is saving “gravy”, but is education for kids “gravy”?
Mad Max
at 1:45 pm
Libraries, in the physical sense, are entirely obsolete.
Study areas, what you are referring to as crowded, are indeed busy – as an area to study.
No one checks out books anymore for research like they did 15 years ago, give your head a shake.
The reality is that there are too many libraries and social programs in the city. That doesn’t mean get rid of them all, just many of them.
Only real solution to traffic would be a downtown relief line (subway). Not the subway up in the boonies like Ford wants.
Joe Q.
at 8:53 pm
Horses for courses — one man’s gravy is another man’s must-have. My local library is full of teenagers and school-kids most evenings and weekends, and the vast majority of people I know who have young kids are at the library at least a few times each month.
Moonbeam!
at 11:12 am
Geoff your son is indeed a lost cause if you teach him to name-call when you respond to someone’s statement of opinion. You are already a lost cause if this is your adult behaviour.
Scott
at 12:59 am
Ouch, Moonbeam!… And here I thought you were all cuddly and what not….
Geoff
at 9:10 am
The right to not be called a name went out the window when David declared, without evidence (because there isn’t any) that an entire generation was a lost cause. Given that my son is part of the next generation, I can take offense to his statement of opinion.
Plus I’ve posted many times before and earned the right for some familiarity with David here.
David Fleming
at 10:00 am
@ Geoff
True. You’re a frequent-commentor and you’ve been on this blog for years. I know you’ve got a young child because you commented on the photo of my niece two years ago when she was a newborn.
You’ve earned the right to say whatever you want, and I’ll never take offence.
I promise.
David Fleming
at 10:03 am
PS – ‘today’s generation,’ ie. those 15-20, are the ones I was expressing displeasure with. A four-year-old child is really part of the generation after, so I’m hoping it’s just ‘kids today’ that get the bad rap (actually ‘university students today’ – but I digress)
Anonymous
at 10:05 am
To be honest, I think it’s a little bit of both. You need to inflate the figures somewhat to make it much more dramatic in order for people to do something. It doesn’t mean that the situation wasn’t dire or there wasn’t any gravy, but unless you do that, you would be hard pressed to get people to cut and be more fiscally responsible.
Everyone asks “where’s the gravy” but forget that a lot of the “gravy” is in wages that we pay the unionized workers, and that’s not something that can be changed overnight due to labour contracts that were signed and agreed to before the Ford administration. However, I think what we have witnessed in the past year is that the Ford administration drives a hard bargain and is a hard negotiator, being able to negotiate for labour contracts that are more respectable for the taxpayer. The fruits of this labour will not be seen until a few years down the road, when the opportunistic, master politician, calculated, vile, backstabbing Karen Stintz may inevitably be elected and claim credit for it.
Ralph Cramdown
at 11:23 am
Gee, why am I not surprised that repealing the LTT would be the first thing on your list? I don’t think that the LTT is a fair tax, either: I think the cost of city services should be borne by all. However, once a significant revenue source relying on a few becomes established, where the alternative is raising everyone’s rates, it almost never gets abolished — think casinos.
Realtors’ commissions still form a much larger part of the transaction costs in nearly every Toronto sale than do other closing costs, and they’re higher here than in most other parts of Canada and elsewhere where agents perform similar functions. And hey, don’t agents tend to trade in real estate more than the average citizen? So whose book are you talking, really?
Rob Ford promised me subways and a unicorn, but once he found out that unicorns don’t exist and subways cost money, I got bupkis.
David Fleming
at 11:50 am
@ Ralph
1) Ferris Wheel
2) Unicorn
3) See 1&2
Perfect Fit
at 12:10 pm
I pick C… sort of. TTC projects/expansion/reinstate increased service for high-volume routes should be a priority. Congestion cost Toronto $6B last year. Anything that can reduce congestion not only affects the quality of life for the TTC riders as well as the drivers, it affects the bottom line. Increase quality of life and reduced costs on businesses and households en mass would be a win-win all around.
CS
at 12:16 pm
Ever been in a streetcar in the downtown core during rush hour?
The TTC needs additional funding. We have the most underfunded public transit system of any major North American city. The congestion on our roads is a burden on all of us and a more reliable transit system would get more cars off the road.
Jeff
at 11:42 am
Was this blog entry a job application to Sun Media? I guess we can expect a blog post later on the plastic bag fee.
David Fleming
at 12:19 pm
@ Jeff
The Toronto Sun?
That hurts.
I’m a Globe & Mail guy, with the National Post a close second.
As for the plastic bag fee, whatever opinion you think I have, you’re probably right…