Mississauga presents budget to help struggling families but COVID ‘echo’ will eventually come calling
Photos from The Pointer files/City of Mississauga

Mississauga presents budget to help struggling families but COVID ‘echo’ will eventually come calling

The COVID-19 pandemic has pushed many families into a precarious financial reality, one that could be made worse by an inevitable tax increase from City Hall. 

Today, Councillors received an in-depth look at the City's financial picture as a result of a pandemic that has upended the world and blown holes into the rainy day funds of governments across the globe. For 2020, financial relief from the federal and provincial governments will help Mississauga avoid a multi-million deficit and relieve much of the pressure, but in the years ahead, the gaps will still need to be bridged, and the financial burden could fall to taxpayers. 

The relief funding from the province and federal government is slated to help Mississauga close its books mostly unscathed this year – with an outstanding deficit of about $9.3-million – but the City’s chief financial officer warns that “echo impacts” over the next three years could put future budgets on shaky ground.

The revised figures come as an apparent relief following a tense wait on word from higher levels of government regarding financial recovery aid, and early deficit projections that modelled for a significantly higher tax hike next year. 

High tax hikes at the local level will hurt families who have already been left in a precarious position as a result of the pandemic. Data from the Region of Peel shows that unemployment in the region rose from 6.7 percent in the second quarter of 2019 to 15.7 percent at the same time this year, “the steepest increase recorded in Peel since Peel-specific data became available in 2006,” the Region states. 

This has led to an increased reliance on Peel’s social services sector, especially local food banks. In Mississauga, the Mississauga Food Bank saw a 41 percent increase in unique individuals served compared to last year, and a startling 138 percent increase in first time users between March and June of this year, compared to the same time period last year.

Any financial hit from City Hall will need to balance the precarious reality facing many residents in the years to come. Councillors will also need to keep in mind that any tax increase will also hurt small business owners, particularly those in the restaurant industry, who have been decimated by pandemic restrictions. 

Revenue losses stemming from provincially mandated safety measures and local restrictions to transit, recreation and other city operations are expected to generate a net budget deficit of $55.4 million. This could balloon up to $66 million in worst-case projections, Mississauga’s budget committee heard Wednesday.


COVID-19 has hit nearly all of Mississauga's revenue streams.


Forecasting for future budgets is difficult, as the length and impacts of the pandemic moving forward remain uncertain. It placed city staffers and local Councillors in a position none of them have experienced before, and has them forming an austerity plan similar to one created during wartime. 

City council has offset declining revenues with measures including temporary staff reductions and program cost-cutting. Another $46.1 million in relief funding from the provincial and federal governments through the Safe Restart Agreement will assist the city to address its red line-items before year-end, leaving about $9.3 million in remaining deficit.

Staff are recommending increasing next year’s budget for the City of Mississauga by 2.7 percent, which would represent about a one-percent tax increase to the overall property bill, when blended with the Peel Region portion and the Province's education portion. The overall tax increase will be based on the rates for all three, which likely won't be set until early next year.

“We're trying to be responsive to the community…and also, we don't fully understand what the medium-term outcomes are going to be, so we don't want to make it any worse” on the taxpayer, said Gary Kent, commissioner of corporate services and chief financial officer, in an interview.

MiWay revenues are seeing the deepest decline, at an anticipated $41.7 million, as a result of reduced service routes and ridership levels which are estimated to stay at half the regular rate until the end of 2020. Bus fares were also suspended for just over three months beginning in March, resulting in a revenue loss of about $26 million.

Most of the phase one government relief funding – $31.1 million of the total $46.1 million – has been earmarked to retroactively cover lost revenue from transit. The remaining $15 million will be used to address the operating budget deficits.

Revenue declines in recreation services are projected to reach $26.7 million, but could go as high as $36.3 million in response to possible facility closures that may be spurred from higher infection rates.


Reduced Miway service has led to the largest reduction in City revenue.


These projections have not been included in the 2021 budget due to continued uncertainty on how the virus spread could affect financial recovery, a report filed to the budget committee states, citing council’s continued efforts to advocate for provincial and federal assistance, as well as use of reserve funding.

Municipalities are not permitted, under provincial law, to run a deficit on operating budgets but can borrow money for capital projects, including large transit development.

Sacrifices in staffing, including the temporary layoffs of almost 2,700 people were done, and 800 people have yet to be called back into work.

“As the mayor reminded others, we are the only level of government to lay staff off. I think that's an important message,” Kent said in his presentation to the committee.

Municipalities can submit proposals to be considered for additional funding under phase two of the Safe Restart Agreement by early November.

Mayor Bonnie Crombie wants to approve the 2021 budget before the end of the year, but deferred to some councillors who recommended waiting for Peel Region budget deliberations, which will happen after the delayed provincial budget comes down on November 15.  

This was in response to assessing a budget rate increase, and tax increase, for next year.

“I would rather do this carefully because if we come in too low this year, we're going to get hit hard the following year,” said Ward 5 Councillor Carolyn Parrish. “And I hate to remind you politicians, but the following year is an election year.”



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