Archived columns and blog posts by Matt Elliott

18 mayors can’t be wrong: Why Ottawa needs to do more for Canada's cities

By: Metro Published on Mon Feb 09 2015

Let’s start with the obvious: The mayors are right.

Eighteen of them, representing Canada’s largest cities, met in Toronto last week for the Federation of Canadian Municipalities Big City Summit. The group included everyone from Vancouver’s Gregor Robertson to Calgary’s Naheed Nenshi to our guy John Tory.

Their message at the end of their session: The federal government has got to do more for cities.

They’ve got a ton of evidence supporting their position.

Despite several years of a nearly universally hot real estate market, Canada’s big municipalities are struggling with their infrastructure.

Transit is strained. Bridges and water mains face huge repair or replacement bills. Public housing is literally falling apart.

And the numbers tell us why.

According to a 2012 City of Toronto Performing Measurement and Benchmarking Report, property taxes account for just 9 per cent of all taxes paid, which means the local government directly receives only about nine cents of every tax dollar paid by the average family. Splits in other municipalities are similar.

That nine cents ends up getting stretched a long way, going toward covering some of our most visible and important public services.

Sure, cities receive transfer payments from provincial and federal governments to help, but these payments are often unreliable — they come and go like the tides.

And every indication is that the federal government in particular continues to shortchange cities. Numbers from the United States Census Bureau in 2008 showed the 35 largest American cities on average funded about 8 per cent of their operating budgets with federal money.

Toronto, on the other hand, only counts on Ottawa for a little less than 2 per cent of operating funds.

So the problem is clear. What about the solution?

It won’t be easy. Municipal underfunding is something that crosses party lines. It’s not been a Conservative thing or a Liberal thing.

It’s been a constant thing.

For any hope of change, Canadian mayors need to take a new and consistent approach.

First, they need to always demand a share of government revenues, not spending. Right now, Ottawa gets away with sporadically announcing some support for certain projects whenever it’s politically advantageous.

A far better system is for the federal government to transfer a direct percentage of revenues to local governments, like happens with the gas tax.

Second, municipalities can’t be afraid to increase their revenues when Ottawa cuts federal revenues. The cut to the federal sales tax nearly a decade ago should have been an opportunity for cities to pursue a local sales tax — a measure that could have erased many of today’s infrastructure problems.

Third, local governments need to use the coming federal election to make their case. Be forceful, unrelenting and, if necessary, loud as hell.

Because after all, the mayors are right. The politicians in Ottawa need to hear them.

This post was originally published at on 2015-02-09T00:00:00.000Z

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Matt Elliott

City Hall watcher, columnist and policy wonk in Toronto.
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