Regional council rubber stamps 2022 budget; staff blame Queen’s Park for additional costs to Peel taxpayers
The well-paid staff at the Region of Peel want you to believe Ontario’s provincial government is the budgetary bogeyman.
While the number of properties in Peel explodes, assessments keep skyrocketing, and the cost of water soars, sending tens of millions of additional dollars to Regional coffers, staff working in the higher tier of municipal government continue to blame Queen’s Park for their financial woes.
The way they see it, municipalities continue to be overwhelmed by the booting of responsibilities down to the regions and cities of Ontario, such as the decision by Mike Harris in the 1990s to punt the entire affordable housing file down to municipalities, after the federal Liberal government led by Jean Chrétien had just done the exact same, downloading affordable housing onto the provinces. The move, say councillors and regional bureaucrats alike, created an almost impossibly large area of responsibility overnight, with no expanded revenue tools to pay for it.
Other costs, local officials will tell you, including paramedic services and childcare, have also slipped down the levels of government, landing at the feet of Ontario municipalities.
Queen’s Park, meanwhile, particularly during 15 years of recent Liberal rule, has repeatedly told towns, cities and regions that if they plan responsibly, allowing growth to be a driver of revenues, while keeping their own operating costs for municipal staff in check, there should be enough money to cover all the services placed under municipal jurisdiction.
It’s a classic case of finger pointing, with all three levels of government partly to blame for the ongoing lack of funding for some of the most critically needed features in any thriving city.
Once again, the downward drip of costs is a key issue Peel has grappled with in its 2022 budget, while its own lavish spending on staffing and failure to rein in excessive costs caused by poor urban planning create additional, self-inflicted challenges.
Next year, the Region of Peel budget will increase 3.8 percent, for an overall property tax impact of 1.5 percent, once blended with the lower-tier budget and the province’s education portion, all of which are combined into the final property tax bill. The utility rate, which is used to fund water infrastructure, will rise by 5.8 percent, an increase that’s about two times the current rate of inflation in Ontario, and part of a trend in the region’s water bill increases over the past decade that has seen an average spike of about 7 percent, three times higher than the inflation rate.
The biggest portion of the budget for taxpayers is funding for Peel Regional Police. The force’s 2022 budget includes 26 new uniformed officers and an increase of 4.8 percent, the vast majority of which is tied to salary increases for frontline officers built into the current collective bargaining agreement.
“We believe this will meet our needs moving forward,” Chief Duraiappah told the police services board, which oversees the line-by-line review of his budget, in October. “While the 26 officers really equate to barely one per shift, but that is one step towards meaningful growth in our region that will start to meet the needs.”
Councillors approved the entire Peel budget in just two sessions. They did not make any changes to the document staff suggested, with a change in the assessment growth reducing the tax impact from 1.6 percent to 1.5 percent without any tweaks.
“The decrease from 1.6 percent was due to positive changes since we went to print,” a regional spokesperson said, listing $2.2 as a result of MPAC assessment growth figures and $0.9 million from supplementary taxes not factored in the original tax increase projection.
Peel Regional Police can do little to reduce its budget increases due to current contract agreements that include above inflation annual salary increases for frontline officers.
(Image from Peel Regional Police/Twitter)
“There remain systemic issues about the property tax that we continue to advocate for, like long-term sustainable infrastructure funding and, critical to Ontario, funding for social housing which, since the ‘90s has been the only province in Canada that funds that critical program from the property tax, rather than the income tax,” Gary Kent, Peel’s newly appointed Chief Financial Officer (a title he previously held in Mississauga) told councillors at the end of November.
The Region provides services to residents that broadly fall under the umbrella of community welfare. It cares for seniors and children, also operating affordable housing and emergency shelter beds. The Region does not have its own transit service but organizes accessible transportation for residents. Vital programs, especially for residents on lower incomes, are delivered under the area of human services.
The Region of Peel is partially responsible for care from the cradle to the grave.
For the past two years, its public health body, and medical officer of health, Dr. Lawrence Loh, have been completely preoccupied with responding to the COVID-19 pandemic. The vast majority of staff who work in public health have been diverted to handling the pandemic. And, while the Region expects to see the direct costs of its COVID-19 response (for example, the mass vaccination campaign) covered by other levels of government, indirect impacts will fall to local politicians and taxpayers to solve.
Adult day services provide a case study of the pandemic’s true effect, or “echo impacts” as Kent has referred to them over the past two budget seasons.
During 20 months of pandemic turmoil, the waitlist for adult day services, essentially daytime care for seniors who live at home and rely on family for support, has increased 32 percent. This comes from the sealing of long-term care homes for more than a year, and the redeployment of staff from adult day services. This key program is funded by the Province (54 percent), the Region (36 percent) and some cost recoveries from clients (10 percent).
Next year, faced with an unmanageable waitlist that sat at 475 people in August, the Region will increase staffing for adult day services by 5.4 percent and net expenditures will rise by 24.2 percent to $3.4 million. Increased operational funding will allow the program to create a new respite centre at Peel Manor to provide wraparound care.
“The Ministry of Health has not increased base funding for the program to address increasing waitlists or the new virtual programming,” a spokesperson said. “While our budget has not increased to reduce the waitlist and there isn’t a current target to remove the waitlist, we always strive to maintain as much capacity as possible within our ADS program. Whenever spaces become available, we prioritize filling them to take people off the waitlist and get them into the ADS program. We also always apply for funding increases when they are available, especially to initiate weekend service at programs where it is not available.”
Sister services in long-term care face similar challenges.
A total of 127 staff, or 12 percent of the Region’s long-term care workforce, have left to work “elsewhere” because they are not vaccinated. In practice, this means that the 127 staff remain officially employed by the Region, but have been placed on unpaid leave until they are vaccinated. As long as they are not vaccinated, they will not be allowed to work in long-term care and can hold other jobs in the community. It is unclear if the Region will hire new staff to replace them temporarily or permanently.
At the other end of the age spectrum, under the heading of childcare, Peel is expecting to really feel the pinch.
Programs run through the Region provide almost 50,000 childcare spaces in Peel, huge portions of which are funded by the Province. Changes in 2021 reduced childcare and early years funding by $5 million dollars in Peel, with $3.8 million of that hit still to be dealt with. That task was made harder by further provincial cuts of $3.3 million planned for next year. In total, changes to provincial funding that amount to further downloading have left Peel with a gap of $7.1 million to fund in this year’s budget.
The cities of Brampton and Mississauga face a severe lack of childcare spaces for the region's families.
(Image from Markus Spiske/Unsplash)
The Region has patched together a solution that shows a mix of financial flexibility, and desperation. The $3.8 million delayed impacts from provincial cuts will be funded through reserves over the next four years, meaning taxpayers won’t feel the sting, at least not right now. The $3.3 million in further cuts has been absorbed “through efficiencies and program delivery changes”, the budget states.
However, the Region has refused to freeze salaries, despite the potential for reduced labour costs in some high paying non-union categories that could have helped offset some of the downloading by the provincial PC government.
Both union and non-union compensation for certain Regional job functions have increased well above the Ontario inflation rate over the past decade. However, staff and elected officials have shown little appetite for reducing these costs to cover badly needed funding for crucial services.
Another shortcoming of the region’s budgeting is the amount of money being used to cover poor planning. Only recently has Peel introduced smart growth philosophies at the heart of its land-use approach.
Money to pay for everything from roads and paramedics to water utilities and public health services have to spread out across far flung areas as sprawl has been allowed to flourish. More compact planning would save the Region of Peel tens of millions of dollars that could be used to address issues such as affordable housing, early child care and public health.
Drawing increased revenue from a better balance of commercial properties, instead of lower-taxed residential ones, would also help increase revenues, while increased density, instead of sprawl, would deliver far higher tax revenues per-hectare.
Until these realities are taken seriously, Regional staff and politicians will likely continue to place all the financial blame at the feet of higher levels of government.
Despite short-term solutions to two of the most immediate threats to its funding, Peel is still bracing for “further administration funding reductions” that could impact service. Even the possibility of a national childcare strategy, currently being thrashed out by the federal and provincial governments, may bring more short-term pain.
Premier Doug Ford and Prime Minister Justin Trudeau have both made public comments suggesting a deal will not be reached in the near term. The federal government is trying to deliver on an election campaign promise to effectively nationalize the country’s childcare strategy and eventually deliver care for $10 per day, on average, to families by 2026, with agreements already in place between Ottawa and eight provinces and one of the territories.
Ontario has not yet signed on.
A spokesperson for the Region told The Pointer that the implementation of a new national childcare plan would “require significant changes” to the current system and that implementing these would come with costs. Peel is not yet clear how much these pressures would be, and says it will have a clearer picture if a deal is signed between the federal and provincial governments.
“The Region’s budget includes a mandatory contribution to early years and child care services,” the spokesperson said. “We expect that this contribution will continue if a new National Child Care Strategy were to be implemented.”
A 2018 report by the Canadian Centre for Policy Alternatives found Brampton had the second-worst provision of childcare in Canada, with Mississauga also inside the top ten worst childcare deserts. Brampton had a childcare coverage rate of just over 21 percent, while Mississauga had a rate of 35 percent.
A more recent report in March 2021 also found childcare enrollment in Peel dropped dramatically during the pandemic, while fees rose. Between February and the fall of 2020, there were 50 percent fewer children enrolled at childcare centres in Brampton and 48 percent fewer in Mississauga. The report estimated 5,000 fewer children at daycares in Mississauga and 3,500 in Brampton.
The slowly advancing cuts in childcare pale in comparison to the costs Peel and its property taxpayers face when it comes to affordable housing.
A regional report during the pandemic estimated the cost of renting or buying was out of affordable reach for 80 percent of Peel’s residents. The statement is backed up by the budget’s assertion that “demand for affordable housing for low-income and middle-income households far exceeds supply and subsidy service levels”.
The reality is playing out on the ground, with the average length of stays in the shelter system increasing, a sign that permanent housing options are bottlenecked.
“The changes underway to transform housing services are starting to show the initial signs of success,” a spokesperson said, putting a rosy spin on the reality. “In 2020, 1,552 clients were housed, and 23 percent of clients presenting with immediate, complex needs were supported to find permanent housing, representing an increase over the previous two years. A client-focused approach that delivers the right level of support sets residents up for long-term, viable success. It is a fiscally prudent approach that allows for solutions tailored to individual/unique needs.”
The reality is Peel’s affordable housing waitlist grew to 22,445 by the end of 2020, from 14,997 residents at the end of 2019, a jump of 50 percent in one year, likely due in large part to impacts of the pandemic. You do not have to be a resident of Peel to be placed on the waitlist.
New affordable housing is desperately needed in Peel.
(Image from Isaac Callan/The Pointer)
The 2022 budget will invest $122 million into the housing file, with the largest portion ($75 million) earmarked for projects under the Housing Master Plan. That document is a subsection of the Region’s Home For All plan and earmarks plans to build 2,240 units by 2028, with further construction stretching out to 2034.
“We will share more information once the project has been awarded,” a spokesperson said.
The Region’s Home For All plan, approved by councillors in 2018, includes a promise to build 7,500 new housing units per year over a decade, with at least 2,000 each year at an affordable rate and 5,500 for those at a middle income or above. The responsibility for building them is vaguely divided between the Region, non-profits and the private sector. The public sector should deliver as many as 1,000 units per year, a target the Region has fallen woefully short of.
In response to questions from The Pointer in February, staff at the Region referred to 2018’s numbers as an “aspirational target for affordable housing” and said they would be updating the Home For All document to “avoid future confusion”.
A report that came before councillors in October warned Peel was in danger of losing key funding commitments from other levels of government if it could not come up with $320 million to guarantee the allocation of funds from higher levels of government. That threat, which could be catastrophic for the Region’s housing plans, is not referenced in the 2022 budget document.
“The Region will review its own capital funding strategies to support these initiatives, as necessary,” the spokesperson said. “We remain committed to finding solutions in partnership with our federal and provincial partners to meet our affordable housing goals.”
Alongside a need to invest in future projects like housing in Peel, the Region faces a monumental task to keep its current infrastructure in good condition. In total, the local government owns around $32 billion in infrastructure, much of which is in need of replacement or repair.
The budget includes a one percent infrastructure levy that is key to closing a funding shortfall of $2 billion over the next 20 years. Last year, some councillors seeking to lower the tax increase attempted to eliminate this revenue which is badly needed to ensure the maintenance of critical infrastructure and the safety of residents.
The utility rate for 2022 also includes a built-in five percent levy increase for the next three years to help close a funding gap of $1.6 billion.
The utility rate has fluctuated wildly in recent years, increasing far above the rate of inflation for at least twelve years. Despite a history of large increases, the Region says its water charges are the lowest for an average household in the GTA.
Unlike the property tax, which is a reflection of the assessed value of someone’s home, the utility rate costs residents roughly the same regardless of property value. Costs can be increased or decreased by usage, but not one’s financial situation.
The finalized budget is the last financial blueprint for the Region of Peel the current council will approve before facing reelection in October 2022.
Next year’s final property tax bill for homeowners will be established when City Council in each of Peel’s two cities approves the lower-tier budget for the coming year.
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