When it comes to the City of Toronto's finances, the warnings just keep on coming and the news keeps getting grimmer.
Yet year after year at budget time, the city somehow manages to pull it off.Right now, by looking at Toronto's recent budget history. one might reach the highly dubious conclusion that there's no problem a tax increase, user fee hike, some 'found' money, reserve tapping or provincial bailout can't solve. That Toronto seems to be able to escape by the hair of its chinny-chin-chin each and every year by incorporating some combination of the above practices is one thing. But doing so in no way represents a remotely serviceable - let alone sustainable - model for a corporation whose annual operating budget has swelled to $9.2 billion. For those of you scoring at home, that $9.2-billion figure is a more than 40 per cent increase in spending when you compare it to the city's budget of only seven years ago. With that in mind, is the city making tough decisions in the wake of a serious fiscal reality? In the midst of all this is a new report from the Toronto Board of Trade, released last week. The report, 'The Growing Chasm: An Analysis and Forecast of the City of Toronto's Finances', states the city's current estimated annual shortfall could more than double in the next 10 years - possibly going as high as $1.19 billion. While the report doesn't claim to have all the answers, the recommendation that the city start budgeting more than one year at a time, for example, is an eminently sensible one.From Toronto's perspective, the measures employed thus far to ensure a balanced budget aren't sustainable or long term. The province, currently facing its own financial chasm, has its own significant challenges. Additional Queen's Park largesse beyond the uploading of $119 million in social service costs for this year appears highly unlikely. A vital agreement on transit funding to start in 2011, however, is reportedly close. There's no doubt that with a more concrete plan, which includes significant provincial and federal support, the city will be on a better financial footing. Partnerships, though, require contributions from all sides. From the city's end, in order to confirm and properly reflect its status as the centrepiece of Ontario's economic engine, it is that Toronto be seen as a model corporation for allocating all its dollars fairly, shrewdly and responsibly. To whom much is given, much is expected, after all.