Mississauga approves 8.8% budget hike as City Hall awaits PC plan for Peel service reconfiguration

Mississauga councillors have tentatively passed the City’s 2025 budget, despite not having a full picture of the impacts that will determine how much more homeowners will pay next year. 

As the municipality locks in where it will be prioritizing spending for the year ahead, City Hall is stuck in a state of precarity as staff and elected officials wait for the PC government to decide what the future of Peel will look like, news of which is expected no later than February. It is a challenge each of the lower tier municipalities in the Region of Peel are confronted with. 

While the PCs had initially announced a full dissolution of the Region of Peel in May 2023, the plans were later abandoned at the end of the same year, citing concerns that a full breakup would not provide the best value for taxpayers, though no evidence was provided to back those claims. The mandate of the Transition Board appointed by the Province to dismantle the Region was then reconfigured to download a set of specific services to Peel’s lower tiers, including land use planning, roads, water and wastewater.  

Instead of trying to stall the process in the face of Ontario’s Strong Mayor Powers, which dictate strict timelines for budget approvals, City Council plans to put forward budget amendments next year if necessary. It means residents may not know what their tax bill will be until a third of the way into the year.

The decision was not popular among all council members. The 2025 budget was passed in a narrow 6-4 vote with councillors Stephen Dasko, Chris Fonseca, John Kovac, Matt Mahoney, Martin Reid and Brad Butt in favour and councillors Alvin Tedjo, Joe Horneck, Dipika Damerla and Sue McFadden opposed. Under the new strong mayor rules, the budget is presented by the mayor and voted on by the other members of council, who can either accept or reject the mayor's budget.

“I know it's a tough budget, and I know there's a lot of people going to be suffering, but I also know we can't cut back services that are needed in our city because of what's happening at the Region, and hopefully this will straighten itself out,” Mayor Carolyn Parrish said during the meeting. “I actually respect those who voted against it. I know it's going to be really tough on people, but we've got to frame this in such a way as we get some wins out of the Province.”

As residents wait in limbo for a final word on just how any regional service changes dictated by the PC government will impact their tax bill, property owners, at the very least, are facing a daunting 9.3 percent hike in total for 2025, when the Region of Peel and City Hall budgets are blended. In large part, this is fuelled by a daunting request from Peel Regional Police which is seeking a 23.3% budget increase. The increase does not include funding for initiatives crucial to Mississauga’s future, including a $450 million request from Trillium Health Partners to support the construction of a new desperately needed hospital that was declined by City Council in October, or means to address a mounting infrastructure gap that has doubled in the last year as critical infrastructure reaches the end of its lifespan.    

The substantial increase is instead required to support the 8.8 percent increase to the City’s operating budget staff say is necessary to help fund $746.8 million in costs to maintain and enhance critical services — a $67.4 million increase from 2024. The overall gross capital budget for 2025 is $628.2 million “and includes substantial investments in maintaining the City’s infrastructure in a state of good repair.” It is covered in part through a combination of funds from reserves; development charges paid by builders for infrastructure; an ongoing special levy for infrastructure and debt repayment; financing (debt); and grants from the provincial and federal government.

Mississauga residents may see the highest tax increase in years for services Mayor Carolyn Parrish says are desperately needed, despite acknowledging it is “going to be really tough on people.”

(Alexis Wright/The Pointer Files) 

On November 27, City Council hesitantly passed the amendments to budget for the year ahead with a 3.3 percent increase on the City’s share of the tax bill — up from the 2.7 percent initially proposed. The entire budget was approved on December 2. If the current 12.5 percent increase forecasted at the Region of Peel is passed, it would translate to an overall spike of 9.3 percent for residents — a sharp jump from 6.3 percent approved for 2024, and nearly five times higher than the current rate of inflation in Ontario. The figure would be even higher if not for another year without any increase in the education portion of the property bill, which has remained flat for several years now. The Peel Police’s $144.1 million budget increase alone — which has been heavily criticized by the City’s Mayor — represents almost half of the 9.3 percent increase for Mississauga homeowners.

According to a spokesperson from the City, this year’s 3.3 percent hike is the largest annual increase on the City’s share of the property tax bill that residents have experienced in the past 25 years. 

During budget deliberations, councillors voted to approve several initiatives that resulted in additional spending and tax impacts. Among them included free older adult recreation programming, secondary sidewalk clearing, vacuum leaf collection, enhanced snow removal for bike lanes, a flood resilience rebate program and city-wide windrow clearing, which came in as the most costly increase to the operating budget at $5.5 million. Approved amendments also include a one-time capital cost impact of $9.25 million in property acquisition and equipment purchase costs relating to the driveway windrow clearing program and $9.1 million for the secondary sidewalk program for 2025, which will be funded through the City’s Tax Capital Reserve Fund. 

Some councillors rejected the scale of spending laid before them in wake of an affordability crisis, Councillor Horneck the most vocal among them.

“I will not be supporting the budget,” he told his colleagues during the meeting. “I feel like we did add a few too many additions. I understand we could expect some changes that will come potentially, but we don't know what those will be… maybe we can do some adjustments then that I would be more supportive of, but I'm not comfortable at the moment with the level of spending we have.” 

“I've taken the proactive stance of trying to suggest some amendments. They've not been accepted by council, which is fair dice, but I'm going to not support this budget, because I don't feel I can take this to my taxpayers and be comfortable. I think there's a lot of great things in it, but it's just at a level that I don't feel comfortable with.”

With the amendments proposed during budget deliberations, Mississauga homeowners would pay roughly $228 (up from the initial projection of $184) on average (using an assessed property value of $730,000) more for property taxes next year—up from a $150 increase in 2024. This does not include the Region's portion or the separate bill to pay for the water utility, which is not part of the property tax. The Region of Peel is proposing a utility rate increase (the water bill) of 5.9 percent for 2025. Combined with the cost of the Region's budget increase, the total represents an extra $383 for the average homeowner, meaning a resident in Mississauga with a home assessed at $730,000 will pay more than $600 extra for property taxes and water in 2025, before adjusting for any changes resulting from the downloading of regional services. 

In an effort to alleviate some of the financial burden being forced on residents, Horneck put forward a motion requesting that the proposed capital infrastructure and debt repayment levy be reduced from three to two percent. It is a motion councillors before him have tried to get their colleagues support but have ultimately failed due to concerns that it will set the City’s spending behind in future years as Mississauga's infrastructure continues to age. 

“I know that we've got a lot of heavy lifting coming at the region, for certain we do, but this is something that we can tangibly give back to residents at $6.8 million that we will decide not to collect from them,” Horneck said. “It will help with affordability a little bit.”

Councillor Joe Horneck proposed to reduce the City’s infrastructure levy from three to two percent for the year ahead in an effort to mitigate the financial pressures on residents. The motion was deferred to the new year.

(Alexis Wright/The Pointer Files) 

The motion also stated that “should the city see a favorable rebalancing of tax allocations between the City of Mississauga and the Region of Peel occur or an unexpected allotment of undedicated funds come from another source that this money be reinserted into the budget as a first priority. Should that not be realized we would draw on existing reserves.” 

“I think this shows that in a $1.3 billion budget, we can find something to reduce, and this is the only amendment of any reduction that's been submitted. We have given money to a lot of different places. At this point, no one has suggested any reductions,” he said. “This is the one that we've got on the table. So I'd ask my councillors to show a little bit of restraint for our taxpayers.”

But with a daunting $90 million infrastructure gap looming over the municipality—this represents projects that must be completed, but currently have no funding source—councillors were reluctant to support the proposal, despite the mounting financial pressures plaguing city residents.  

With $18.5 billion in assets, costs to maintain and build roads, buildings and other features in the rapidly urbanizing municipality are the driver of the City’s infrastructure levy which “continues to be an important source of funding.” But as in previous budgets, the 2025 document warns “There continues to be, however, an infrastructure gap; the City’s current funding sources do not allow for full funding of the City’s state-of-good-repair (SGR) needs.” Just a few years ago, the City projected that over the next decade, on average, it would be required to spend $206.6 million annually to maintain and replace existing assets. Now, the latest report shows that $273 million will be spent annually, but $363 million is how much is needed, leaving a $90 million gap, more than double the $44 million reported in 2024. 

City staff have included a special infrastructure levy in each of the 2025-2028 budgets to help the municipality maintain its infrastructure in a state of good repair. Marisa Chiu, Mississauga’s director of finance, told council that if the levy were to be reduced by one percent, it would cut City revenues by approximately $6.8 million. She also noted the reduction to the levy would be compounding, adding that if council chooses to reduce it for 2025 it will not be built into the City’s base budget for future years. 

“Without that one percent we're losing more than just $6.8 million. It'll be a cumulative effect of the $6.8 million, adding to close to $70 million over the course of 10 years,” Chiu said. 

The latest projections from staff show the City will need $363 million annually to cover Mississauga’s basic infrastructure needs.

(City of Mississauga)

“Whatever we're moving today isn't set in stone,” Mahoney pointed out, adding that if council chose to defer the motion, it could be revisited if the City does not see any cost savings from the Province once the recommendations are provided.  

The details on how the Province plans to download waste management, water and wastewater, planning and roads to the Region of Peel’s lower-tiers likely will not be revealed until February as Queen’s Park prepares to take a two-month break, Parrish previously indicated. 

Damerla proposed to defer the motion until council has a better understanding of what recommendations will be coming forward from the Province on the downloading of regional services to the lower-tier municipalities as well as a request from the City for the PCs to review the current funding model for Peel Police. The City of Mississauga is looking for these costs to be split evenly between Brampton and Mississauga, currently Mississauga covers 62 percent of the PRP budget to Brampton’s 38 percent.

Downloading regional roads, water and wastewater, and planning currently handled by Peel and waste management could significantly alter the budget City Hall has already prepared and it remains to be determined what the financial implication will be. Parrish’s letter has highlighted the City is already anticipating the downloading of regional roads “will result in significant savings for Mississauga property taxpayers of at least $30 million.” 

“I'm hearing all of these great things that could be coming to us, and the big word is, could be coming to us, from the Province and how things will shake out. All I'd like to see is that set in stone. I'd like to know that funds are going to be actually in our accounts that we can make these decisions on,” Dasko said in response to the deferral.  

“As we're at right now, if all of this does not come to fruition and we do make that one percent cut, the compound effect… really scares me, because we might not have our residents pay for it this year, but in years to come, they're going to keep paying for it in spades.”

Mahoney, who seconded the deferral, added, “I'd like all of this information before we make the decision. There's still a lot of unanswered information out there, things that we're waiting for to come forward. It does not hurt us to just wait a couple of months to see what information we get from the province. So by us deferring it, we're not saying no, we're just saying we don't have all the information that we need to make this decision right now.”

Council voted to defer Horneck’s motion to be reviewed in the new year once the recommendations from the Province are made available. The vote passed with councillors Fonseca, Kovac, Reid, Mahoney, Dasko and Damerla in favour. Councillors Tedjo, Butt, Natalie Hart, McFadden and Horneck voted against. 

Clockwise from top left: Councillors John Kovac, Martin Reid, Joe Horneck, Dipika Damerla, Brad Butt, Matt Mahoney, Chris Fonseca, Alvin Tedjo and Mayor Carolyn Parrish. Several of the councillors pictured above led discussion and debate on the 2025 budget.

(The Pointer Files)

Other major spending in the 2025 budget includes a $182.8 million increase in funding for Mississauga’s roads — 30 percent of Mississauga’s capital spending for the year ahead (up from $104 million in 2024); $108.9 million for transit with $33.2 million to go towards buses and $34.1 million as the City moves to electrify its fleet; $53.5 million for stormwater in 2025 to improve the City’s response to future storms after Mississauga experienced two ‘100- year’ storms within a month of each other over the summer; and $28.6 million for Mississauga’s Fire and Emergency Services, which includes $21.7 million toward two new fire stations, the renovation of five existing stations and $6.8 million for vehicles and equipment.

Correction: A previous version of this story stated the budget increase for 2025 is 8.9 percent. The correct figure is 8.8 percent. The full budget was ratified on December 2, a previous version of this article incorrectly stated the date as November 27th.

Email: [email protected] 

Twitter: @mcpaigepeacock

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