So far in our debt miniseries we’ve looked at the nation’s debt as a whole, and broken that down into Ontario’s debt and what that means for the residents within this province. Today we’ll pinpoint the debt in Ontario even further by looking at the biggest city within it – and within Canada – and seeing just where Toronto’s debt lies, and what that means for the Torontonians that live here.
A look at the chart below shows just how much debt Toronto currently owes. You can see that the City’s long-term outstanding debt currently sits just below the 3 billion mark, and that it’s only going to grow further for the next several years. However in 2018, things are forecasted to turn around, and that’s when Toronto will start to see the debt go down.
This seems like a lot, and some journalists have even called Toronto “a city of debt and decay.” This is not actually true, although it may feel like it at certain times, such as when the budget is released. But, even being in debt-laden Ontario, Toronto is one of the richest cities in Canada believe it or not. The chart below shows Toronto’s debt compared with several other major cities across Canada. As you can see, only Calgary is beating Toronto in the debt race, with the lowest amount in Canada; and cities like Vancouver and Montreal have at least twice the debt than Ontario’s capital.
But where is the debt going that we do have? Under the City of Toronto Act, the city cannot borrow money for operating expenses; but it can borrow money for capital expenditures. This means that the City can borrow to make investments in things like infrastructure that will are typically a one-time expenses and benefit the city for a long time. The City cannot borrow for recurring expenses though, such as to make payroll for City employees. So, what capital expenditures is Toronto currently going into debt for? That’s just what the chart below looks at. And it shows that TTC is the biggest debt that Toronto currently has.
The City is working to pay off that debt, though. In fact, the next chart shows that Toronto pays more to service its debt than it does any other to make any other expense.
Just like the rest of Canada, the City of Toronto looks mainly towards taxes to pay off the debt it owes; and that comes mainly in the form of property taxes from your Toronto mortgage. So what does this mean for you? Have a look at the chart below, to show what percentage of your tax dollars are going towards a percentage of the debt – and just what debt it’s paying off. As you can see, the police service is number one, with the TTC not surprisingly very close behind.
Of course when looking at what the Toronto debt means for individual Torontonians, it’s always interesting to see how much of the city’s debt each person in that city owes. So, we’ll leave you today with a chart indicating Toronto’s debt per capita, or per person. As you can see, the number for those who live in Toronto and York are much higher (nearly double!) than those who live in the surrounding area.
Make sure you join us tomorrow when we veer away from looking at national, provincial, and inter-city debt, and we’ll focus on YOU! A look at your debt, the debt of Canadians, and how we can start doing something about it! Make sure you join us tomorrow for our fourth installment of our debt miniseries! And, if you want to read more about Toronto’s debt in the meantime, you can read the full report created by the City of Toronto, here.