Mayor fights back over surplus attacks

Mayor David Miller’s announcement the city has an additional $100 million budget surplus has sparked a political war of words.

“When the budget was announced almost a month ago, the estimated surplus was $250 million,” he told a packed house of media in his city hall office March 10. “I am pleased to announce today that more accurate year end accounting only now available, estimates the surplus to be over $100 million dollars higher.”

Toronto-Danforth councillor Case Ootes was not impressed with Miller’s announcement.

“Why didn’t he know about it before?” Ootes asked. “I don’t know why he called this press conference to highlight the fact this whole place has been mismanaged.”

Miller told the media it’s hard to get complete year-end numbers too far advance before final figures are available.

“If you look at the provincial and federal governments, they correct their year end numbers months later,” said Miller. “These numbers were simply not available until the last few days.”

The $100 million surplus was achieved in large part to the city keeping wages down, higher than expected returns on its investments, more property taxes from new buildings, fewer property tax assessment appeals and a pay off from restructuring its debt in 2009.

Of the surplus, $25 million will be used this year to lower the proposed property tax increases from 4 to a 2.9 percent for residents and to less than one percent for businesses. Proposed user fees and service cuts will be reexamined.

The remaining $75 million will got into a tax stabilization reserve fund to help balance the 2011 operating budget. Miller suggested that money be used to keep any property tax increase to three percent and a freeze on TTC fares next year. That recommendation was contingent on the province resuming cost-sharing the TTC’s operating budget by chipping in $250 million annually.

Mayoral candidate George Smitherman was displeased Miller was reaching his arm into the 2011 budget even though he won’t be mayor at that point.

“I think it’s really questionable the mayor commit to (the TTC) because he won’t be the mayor then by hook or by crook,” Smitherman told the media.

Miller told the Town Crier, he is not telling the next council how to balance its budget.

“We are creating a $75 million reserve fund for the next council to use,” he said. “It’s up to council to decide how to use that.”

Adding to the ire over the announcement, councillor and mayoral candidate Giorgio Mammoliti has asked Toronto’s Integrity Commissioner Janet Leiper to investigate whether or not the budget committee met behind closed doors to discuss the $100 million surplus before Miller’s announcement.

Miller said Mammoliti’s claim is not true and stated city staff’s budget variance report was released publicly the same day as his announcement of the surplus.

The entire budget will be voted on by City Council March 31 and April 1.