Michael Lewis
Toronto’s proposed 2025 capital budget, the largest 10-year capital plan in the city’s history at $59.6 billion, calls for more housing investment and a surge in spending to tackle a maintenance and infrastructure repair backlog.
A $9.8 billion increase over the 2024 capital budget, the capital plan earmarks nearly $10 billion for home building, including foregone revenue from affordable rental housing incentives, while prioritizing state-of-good-repair (SOGR) upgrades with $32.4 billion in spending through 2034.
The SOGR funding represents a 31 per cent increase over the past two years as Toronto works to address a massive backlog of repairs to the city’s ageing infrastructure.
State-of-good-repair investments will focus on areas including refurbishing the TTC’s fleet of buses, streetcars and subways, restoring parks and other community infrastructure and maintaining community housing.
The SOGR backlog stood at $9.4 billion last year and is expected to almost double through 2034, a forecast, however, that is 29 per cent lower than the outlook in last year’s budget.
“With the support of our federal and provincial partners we’ve been able to increase our investments in critical capital infrastructure by almost 20 per cent compared to last year while still staying within our debt service limits,” Toronto CFO Stephen Conforti said in a presentation to the city’s budget committee on January 13.
“Because of this we are starting to see a flatlining of our SOGR growth curve.”
“What we are doing is fixing what we have,” Mayor Olivia Chow said at a press briefing before the presentation. “The longer we wait to fix things, the more expensive it is, especially hard infrastructure.”
“Toronto is still recovering from a decade of underinvestment,” added budget chief and Ward 17 Coun. Shelley Carroll who accompanied the mayor at the briefing.
The proposed capital budget, prepared by staff and endorsed by Mayor Chow, sets aside $380 million for bridge and road rehabilitation, $92 million for the Vision Zero pedestrian safety plan, while also spending to reduce approximately 160,725 tonnes of greenhouse gas emissions.
The capital budget invests:
$4.9 billion in transit and mobility including $1.3 billion for new subway cars, $1.2 billion for eBuses and $500 million to overhaul vehicles.
$2 billion in community services.
$2.9 billion in investments, including flood protection and net zero initiatives.
A 1.5 per cent increase in the city building fund levy — dedicated to transit and housing — will add $58.37 to property tax bills based on the most recent assessed value of Toronto residences.
The 2025 operating budget of $18.8 billion, a $1.8 billion increase over last year, includes $94 million to reflect the input from Toronto residents during October consultations, the city says in a statement.
The increased spending includes about $815 million contributed from other levels of government along with a $654 million or 3.8 per cent increase in municipal expenditures. A staff report says the budget incorporates about $680 million in “savings and offsets.”
Mayor Chow said the operating budget spending increase will feed 8,000 more students through school food programs, expand transit service hours, add more traffic agents and emergency services positions (fire, police and paramedics,) extend Sunday service hours at 67 Toronto Public Libraries, enhance cleaning at recreational facilities, lengthen opening hours for outdoor pools and add more apartment inspectors.
The combined operating and capital budgets are supported by a property tax increase of 5.4 per cent for residential properties. With the 1.5 building levy added on the cost increase would be 6.9 per cent or $268.37 a year on the average home with an assessed value of $692,031.
As part of the budget taxpayers will also see 3.75 per cent increases to water and garbage fees.
The mayor last year revised a staff proposal and shaved a point from the proposed residential property tax increase to bring the total to 9.5 per cent.
Coun. Carroll acknowledged that the hike, following a 7 per cent increase in 2023, was an “extraordinary ask” but was needed to help bridge a $2 billion shortfall and balance the budget as required by statute.
But Ward 19 Coun. Brad Bradford questioned whether ratepayers are getting full value for their money.
“With last year’s historic tax increase, you’re now looking at 16.4 per cent over two years. I think if you go out and ask Torontonians if the services have improved by 16 per cent, they’re going to tell you ‘absolutely not.’
“Obviously affordability is not the priority of Mayor Chow and this administration, to introduce a tax rate that is triple the rate of inflation,” Coun. Bradford said at the press briefing.
“What are Torontonians getting in return?” he added in a post on X –“rising costs, stagnating services and a city government that has-been overrun with bureaucracy.”
The city’s budget process kicked off this week and will continue through the month with public presentations and telephone town halls. The mayor’s proposed budget with any changes is to be released Feb. 1 and brought before the full city council at a special meeting on February 11.