Yesterday, Mayor Miller announced that for the first time since amalgamation in 1998 the City of Toronto has a balanced budget for the 2008 year. The budget still needs to go to council for approval and amendments. No extra money can be added to the budget.
This is a landmark accomplishment. After last year's tax revolt the city managed to find $116 million inefficiencies. They also received some handout money from the Provincial government for transportation and some social programming costs were uploaded. Miller has been ignoring the significant contribution of the average tax payer.
Miller announced that they there will be 'modest' property tax increase of 3.75%. He claims that he has kept his promise to keep property tax increases in line with the rate of inflation. Stats Can reports that the current rate of inflation is 2.2%. Plus the same tax payers are on the hook for the vehicle registration tax and land transfer tax. The city has also upped the fees for various services, including the recent TTC fare hike.
The freeze on market value assessment for real estate has been lifted. Over the next 4 years the property value used to determine property taxes will rise until it reaches true market value. With a booming real estate market, residents who have lived in their homes for decades may no longer afford to keep them. If the city uses the balanced budget to reduce property taxes in the future they can offset some of the hardship from MVA. If the city continues on their previous path and decides to spend the extra money the city will once again create their own financial crisis.