Toronto Mayor John Tory says the city needs to make cuts in its operating budget

Mayor John Tory stands firm on low taxes in the face of massive budget shortfall, declining city services, and declining revenues as he attempts to balance city budgets

By Peter J. Fritsch

Published: December 6, 2012

Toronto Mayor John Tory stood firm in the face of a budget showdown in which the city’s revenue picture has suddenly taken a different tone – from good to bad – than it had been in the weeks before the provincial election.

In a statement to council after Thursday evening’s meeting, Tory said Toronto has enjoyed a good financial year, but that, because of declining revenues, there is a real need for deep cuts in Toronto’s operating budget of about $1.2 billion.

The city will be unable to come back with a balanced budget if cuts are not made, Tory said.

The city faces an annual shortfall of almost $2 billion, leaving it with the fewest operating funds of any major city in North America. As a result, there’s a real need for deep spending cuts, he said.

“We need to make some pretty serious changes,” he told reporters. “We have to ask ourselves…why we’re the only city in North America that has been in this situation. We’re going to have to make very fundamental changes in all parts of this City of Toronto.”

There was some good news on the operating side of the ledger. The operating budget would drop slightly next year, Tory said, but the drop would be enough to balance the budget. The biggest increase in the operating budget – and the biggest change to the city’s financial picture – will come in the next few years with the new funding from the City of Toronto’s share of the Ontario Lottery and Gaming Corporation.

At the same time, he said, Toronto is going to have to make tough decisions on spending outside of the operating budget.

“We’re going to have to take some significant changes in our long-term financial plan,” he said. “This is not just about raising capital.”

The city is going to be forced to make significant cuts in areas like streetcars, security and day

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