Toronto will receive $1.2 billion in additional funding to help offset the costs it has incurred due to the COVID-19 pandemic, money that Mayor John Tory says will help eliminate the deficit for 2020 and provide a “good start” in addressing a shortfall that could reach $1.5 billion in 2021.
The funding represents the second phase of financial assistance that is being doled out from a $19 billion federal fund to help provinces and territories restart their economies.
In total, the Ontario government will provide municipalities with nearly $2 billion from this phase of funding, including $1.3 billion that will be set aside to cover losses incurred by municipal transit systems.
“This funding will confirm that we will be able to continue with vital services and do so without incurring a deficit which under the law we are not allowed to do,” Mayor John Tory told reporters during a press conference at Queen’s Park on Wednesday morning. “It makes the City of Toronto whole, balances our budget for 2020 and represents a good start in fact on addressing some of the issues we will continue to face in 2021.”
At one point city staff were forecasting a shortfall of $1.8 billion in the 2020 budget due to hundreds of millions of dollars of lost parking and transit revenue as well as a myriad of other unexpected costs resulting from the pandemic.
In October City Manager Chris Murray said that the shortfall had been reduced to $673.2 million as a result of city mitigation strategies totalling $542.8 million and nearly $700 million in from the first phase of restart funding.
Speaking with reporters, Tory said that the funding announced on Wednesday helps cover the rest of that shortfall and is “proof positive of what can happen when governments work together.”
“From the standpoint of Canada’s largest city this is good news but it is also good news for all municipalities’ right across the province,” he said.
TTC saw revenue decline by $332M in 2020
Tory said that the TTC alone saw its revenue decline by $332 million in 2020 while the Toronto Parking Authority took in $96.4 million less than expected.
The city also faced an additional $185 million in additional costs related to maintaining physical distancing in the shelter system, most notably the use of 17 hotels and seven community centres as temporary facilities.
There is hope that financial impacts from the pandemic will lessen in 2021 but the TTC, for example, is only projecting ridership to climb back to 50 per cent of pre-pandemic levels once “mass vaccinations” begin later in the year.
“We hope that as the year progresses we will have some success with vaccines and that will help us be in a situation where our revenues will recover on transit and in other areas in the New Year so we will have less need for assistance,” Tory said. “But at this moment we still need the other governments to come forward and be of assistance again to make sure we can continue to do what we have to do, delivering the services people rely on.”
The safe restart funding can only apply to costs incurred in 2020 but Minister of Municipal Affairs and Housing Steve Clark did say on Wednesday that “conversations are ongoing” with other provincial and territorial ministers to determine what the “next ask” will be of the federal government.
