Toronto’s year-end surplus surges to $154 million

A big factor in the rosier picture is the land transfer tax that Ford calls unfair and has vowed to eliminate. The tax raked in $96.5 million more than the expected $220.5 million.   The City of Toronto’s 2011 surplus has surged to $154 million, according to new figures certain to put pressure on councillors to spare threatened services. Facing a revolt from cuts-shy allies, the administration of Mayor Rob Ford is already moving to halt two of the most contentious proposals for cuts. Mark Towhey, Ford’s policy chief, told reporters Thursday that a $400,000 cut to student nutrition programs and the closure of a dozen community centres in schools are being taken off the table. Numbers released Thursday, ahead of Monday’s committee vote on the proposed 2012 budget, predict the city will actually underspend its 2011 budget by $174 million, but $20 million is being used to fund staff buyouts. The Star quoted sources last week saying the surplus would be significantly more than the $139 million projected earlier. The $154 million will be carried over to 2012. In the past, part of the surplus was used to maintain or enhance city services while keeping a lid on property tax hikes. But Mayor Rob Ford is adamant the city must end its reliance on unpredictable revenue sources. His proposed budget would balance the books with service cuts, steep user-fee hikes and city staff layoffs. On Monday, the budget committee will vote on proposed cuts that include eliminating some homeless shelters, daycares, wading pools and programs for recreation, the arts and HIV prevention. Councillor Gord Perks noted that finance staff have recommended putting $115.5 million of the surplus into a reserve fund to finance capital projects, and $38.544 million into various other reserves. “That $38.544 million is enough to prevent TTC service cuts, closing swimming pools, community centres, recreation programs — all the cuts that would hit children the hardest,” Perks said. Budget committee members are split on whether to use surplus cash to rescue some of the services and programs. Councillor John Parker (Ward 26, Don Valley West) told the Star last week he favours aiming the windfall at depleted reserve funds, but wants to see the complete financial picture before making a final decision. After the budget committee votes Monday, the spending plan moves to Ford’s executive committee next Thursday and then to full council for what is expected to be a raucous session, starting Jan. 17. The final word on the 2011 surplus won’t be known until all the figures are in, months from now. That figure has traditionally been higher than the one furnished around year-end. David Rider       Urban Affairs Bureau Chief      The Toronto Star