‘Backbone of this province’: Cities ask for financial help from Ontario government

Municipalities across the province are calling on the Ford government to replicate Toronto’s ‘new deal’ and negotiate fresh financial agreements with them as they struggle with growing costs and accuse Queen’s Park of underfunding them.

The premier said municipalities “really are the backbone of this province” but doesn’t seem to be humouring the request.

The growing calls are rooted in the new deal signed between Ontario and Toronto in late 2023. That deal, worth at least $1.2 billion, saw the province take control of the Don Valley Parkway and Gardiner Expressway away from the city, saving it billions in capital costs.

The deal also featured money being handed to Toronto Mayor Olivia Chow for new subway trains, homelessness and to operate two light rail projects.

Since the deal was struck, other municipalities have been asking for help of their own. They’ve called on the Ford government to offer them help to offset the costs of services downloaded by previous governments, particularly under Mike Harris.

Burlington mayor and chair of the Ontario Big City Mayors Marianne Mead-Ward repeated the call at a joint press conference with Ontario Premier Doug Ford on Thursday.

“The deal that we have is built 100 years ago when really the challenges that municipalities faced was potholes and maybe some roads,” Mead-Ward said.

“Now, we are dealing with mental health, with addictions, with homelessness and of course a housing crisis,” she added. “None of those issues were contemplated 100 years ago.”

Mead-Ward suggested homeowners are shouldering too much of the financial burden through their property taxes and called on the federal and provincial governments to “strike a new deal.”

The Burlington mayor is not alone in her complaint.

The Association of Municipalities of Ontario (AMO) started the year calling for a “new fiscal arrangement” between towns, cities and Queen’s Park.

AMO said years of underfunding from other levels of government, inflationary pressures and aging infrastructure are threatening to crush local property taxpayers.

“We will very much be seeing increases in property taxes, user fees as a result of all of the various factors,” AMO’s director of policy and government relations, Lindsay Jones, said during pre-budget consultations.

The head of Ontario’s second-largest local government raised the issue directly at the end of last year.

Nando Iannicca, the chair of the Region of Peel, wrote to Ford and his finance minister in December complaining that “outdated funding models” had left local government picking up the strain.

Regional governments deliver a series of programs that are ostensibly funded by the provincial government, including paramedic services, public health and seniors’ services.

Councillors and staff have long complained that those programs have become more expensive to manage, while provincial reimbursement has dwindled. Iannicca said that in Peel, provincially mandated programs were set to be underfunded in 2024 by roughly $5.7 million.

“Peel Region, like many other municipalities, is facing significant fiscal challenges due to outdated funding models, and historic under-funding for provincially mandated services,” Iannica wrote.

“The level of funding that Peel Region receives for provincially mandated services is being outpaced by significant population growth, increased service demand as well as substantial increases in inflation.”

In a response sent months later, Finance Minister Peter Bethlenfalvy pointed to the money his government had spent and said it was increasing.

Ford said he was spending billions on infrastructure for towns and cities, adding: “We also do a lot of one-offs.”

The deal with Toronto, Ford said, was a specific circumstance, suggesting it was unlikely to be replicated elsewhere.

“You mentioned Toronto, that is pretty unique — one of the largest cities in North America, they have unique needs like the subway and policing and so on and so forth,” he said.

“We are always going to be there for the municipalities.”

A senior government source with knowledge of the Toronto deal and long-term government thinking previously indicated to Global News that Queen’s Park is always open to working with local mayors to hear individual requests but would make funding decisions on a case-by-case basis, not under the umbrella of new deals.

“We always talk to municipalities about what their challenges are and where they need funding (but) Toronto’s deal is quite unique,” they said.

Only Ottawa has the province’s attention so far with a request to upload its highway in a similar move to that Gardiner or Don Valley takeovers, the source said.

“We continue to speak regularly with our partners in the provincial government about how we can work together to resolve unique challenges in Ottawa,” a spokesperson for the Ottawa mayor told Global News.

Other cities, the provincial source said, are yet to convince Doug Ford to loosen the purse strings and fund their demands.

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