Toronto’s booming real estate market generated more cash than expected for the city in the form of land transfer taxes and development fees, contributing to a $168-million surplus for 2013.
The final budget numbers were released on Tuesday, as the municipal election campaign is gaining momentum, with Mayor Rob Ford officially announcing he will return from rehab at the end of the month. The financial figures will form a backdrop for this fall’s municipal race and are likely to be a major part of the mayor’s re-election efforts.
Mr. Ford has long said he wants to reduce the land transfer tax. Former city councillor David Soknacki and Councillor Karen Stintz, both running for mayor, have proposals that would index the tax to take into account rising house prices. Candidate Olivia Chow has said she would keep the tax, and John Tory has yet to release a position on the issue.
The new budget numbers show higher housing prices and sales volumes generated $40-million more than expected in land transfer taxes, which totalled $356.8-million last year. Revenue from development applications rose 29 per cent to $4.1-million.
A $47.7-million surplus at the TTC also was a major contributor to the final budget numbers. This surplus appeared after the transit agency spent less than expected in several areas. It would usually go back to the city, but Ms. Stintz got support at the last TTC board meeting for a motion seeking to dedicate the money to a fare freeze next year. The motion still needs to be approved by council.
On the negative side, the city experienced a 112-per-cent decrease in revenue from court services, to $17.6-million, largely because of a dramatic drop in the number of tickets police issued. Last year, police filed 467,565 tickets, down 28 per cent from 649,117 a year earlier and a 35-per-cent drop from the 720,418 written in 2011.
With a report from Oliver Moore