This article was last updated on April 16, 2022
Canada: 
Oye! Times readers Get FREE $30 to spend on Amazon, Walmart…
USA: Oye! Times readers Get FREE $30 to spend on Amazon, Walmart…
Mayoral candidate Rob Ford released a Financial Impact Statement today which includes all of his platform initiatives and the financial impact on the City of Toronto’s budget over the next four years. Ford will be presenting the Statement to members of the media at his 245 Dixon Road campaign office today, October 8, 2010, at 11 am.
During his first-term as Mayor, Ford’s plan will produce a net surplus of nearly $1.7 billion. This surplus will be allocated to improve priority services, rebuilding reserves and debt repayment.
“My opponents would have the public believe that it’s complicated to stop the wasteful spending at City Hall. It’s not complicated – we need to simply stop spending more than we take in,” said Ford. “We cannot overtax people and businesses and must start focusing spending on the priority areas of our residents.”
The statement includes:
The financial impact of Ford’s platform is a net reduction in city spending of $525.6 million in 2011. The city’s current estimate of financial “opening pressure” for 2011 is $503 million. Ford’s plan, therefore, creates enough fiscal space to overcome this opening pressure and close the year with a $22.6 million surplus.
Four-Year Surplus to improve services, rebuild reserves, pay down debt
Over the four-year period from 2011 to 2014, Rob Ford’s plan will produce a net surplus of about $1.7 Billion. This surplus will be allocated in the taxpayers’ best interest as follows:
- Improvements to Priority Services. One quarter of the money saved from reducing waste at City Hall will be allocated to improvements in services that impact the quality of life of Toronto residents every day. Specific program allocations will be made in consultation with City Council and after full community consultation. For example, areas that may be funded with these priority funds could include: childcare services, services for seniors, making Toronto more accessible for people with disabilities, affordable housing, improvements to city-owned housing stock, etc.
- Rebuilding Reserves. One quarter of the money saved from reducing waste at City Hall will be allocated to rebuilding our financial reserves to provide Toronto with the necessary financial “cushion” to deal with emergencies and unexpected expenses.
- Debt Repayment. Half of the money saved from reducing waste at City Hall will be allocated to paying down the city’s debt. This will reduce our annual debt servicing expense and make additional money available to improve services for taxpayers or to hold the line on future tax increases.
Table 1: Use of Operating Surplus
Allocation | Estimated Amount (2011-2014) |
1. Priority Service Improvements | $416 million |
2. Rebuilding Reserves for Emergencies | $416 million |
3. Paying Down Debt | $833 million |
Total: | $1.67 Billion |
Changes to Capital Budget
The capital budget is funded primarily by issuing debt and with funds contributed from the current year Operating Budget. The city’s planned contribution to the capital budget from operations in 2011 is $182 million. In 2012, that number is projected as $200 million. We will reduce this transfer from the operating budget to the capital budget by $125 million in each of 2011 and 2012.
To offset this reduction in funding to the capital budget, and to enable the city to pay down some of its debt earlier, we will sell surplus assets (primarily land). Over four years, we will sell up to $1 billion in surplus assets, with a target of at least $125 million in each of 2011 and 2012. This will make up to $750 million available, over the four-year period, for additional debt retirement.
Table 2: Changes to Capital Budget
Change | Impact (2011-2014) |
Reduction in Current Funding | ($250 million) |
Sale of surplus assets | $1 Billion |
Total: | $750 million |
Debt Repayment
We will use half of surplus funds from the operating budget (about $833 million) and the net proceeds of sales of surplus capital assets (about $750 million) to pay down debt. This will reduce the city’s debt by about $1.58 billion over four years.
By paying down debt, we will reduce the annual cost of interest payments – freeing up that money to be used on service improvements for residents and businesses.
Table 3: Funds available for Debt Repayment
Source of Funds | Estimated Amount (2011-2014) |
From Operating Surplus | $833 million |
From sale of surplus assets (net) | $750 million |
Total: | $1.58 Billion |
(1) City of Toronto: Budget Committee Recommended 2010 – 2019 Capital Budget and Plan (p.2)
“If we want to prosper as a City, we need to create jobs and grow our economy,” Ford added. “Living within our means by respecting taxpayers’ money is the first step to do that,” he concluded.
You can publish this article on your website as long as you provide a link back to this page.
Be the first to comment