What to know
- Brad Bradford is proposing a “true separation” of Toronto’s operating and capital budgets.
- His campaign says hundreds of millions of dollars are currently transferred between the budgets each year.
- Bradford says the change would help fund promises including eliminating the municipal Land Transfer Tax.
- Olivia Chow’s campaign criticized Bradford’s spending commitments and questioned how his promises would affect city services and debt.
Mayoral candidate Brad Bradford is promising a “true separation” of the city’s operating and capital budgets, which he says will end the hundreds of millions of dollars moved between them each year.
At a campaign announcement Thursday, Bradford unveiled his plan to “modernize” Toronto’s budgeting process by separating the operating and capital budgets, which he says are only separate on paper.
“In practice, hundreds of millions of dollars a year are moved out of the operating budget, funded by that year’s property taxes and land transfer tax, to pre-pay for capital projects that taxpayers won’t use for years,” Bradford’s campaign said in a release to Now Toronto.
Bradford’s campaign claims the city earmarks about $256 million of those transfers for 2027 and about $369 million for 2028.
Bradford says ending those transfers would help create room for several of his campaign promises, including his commitment to eliminate the municipal Land Transfer Tax.
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Bradford’s campaign is emphasizing that Toronto has a structural budget problem, claiming that more than $1 billion of the capital budget went unspent, meaning important projects the city committed to building were not delivered.
He attributes this to the reason why taxes go up each year.
“The problem was never that Toronto is poor. The problem is a budget rulebook from the 1990s that overtaxes people today to pay cash for things that don’t get built.”
Under the proposal, Bradford’s campaign says the operating budget would be funded through taxes and fees and balanced annually, while capital projects would be financed over the lifespan of the assets being built.
The campaign points to other levels of government that have separated their operating and capital budgets.
“Our Prime Minister has modernized our country’s books, with separate operating and capital budgets. Truly embracing the same practices here gives Toronto a modern, sustainable budget,” Bradford said.
Bradford’s campaign also said it will implement the “tightest debt rules in the country.”
This includes ensuring debt interest never rises above four cents of every revenue dollar and total debt costs never above 10 per cent of own-source revenue.
The campaign says this will include borrowing for building in the capital budget only, and for operating expenses.
Chow takes aim at Bradford’s promises
Mayoral candidate and rival Olivia Chow was quick to criticize the many plans that Bradford has proposed, including promising to freeze property taxes for one year.
The campaign called the $6 billion worth of promises “reckless.”
“He is asking taxpayers to pay interest to big lenders and keeping secret which city services will get slashed, and how big the bill will be when the debts come due,” Chow’s campaign said in a statement to Now Toronto.
Chow’s campaign argued that interest payments reduce the money available for city services.
“The bill will come due,” Chow said.
