Toronto will have lower taxes, better services and a balanced budget in 2011, Mayor David Miller said at a Wednesday morning news conference.
Miller said the city has a larger surplus -- about $100 million more -- than what was originally believed. The surplus was predicted to be about $250 million a couple of months ago when the city released its 2010 budget proposal.
"The numbers a few months ago were an estimate," he said.
The money will be allocated to a property tax stabilization reserve which will reduce taxes for Torontonians, he said.
The 2010 operating budget proposed a 4 per cent property tax increase for residents. Now, the unexpected surplus means the expected tax hike will be reduced by 25 per cent to 2.9 per cent and less than one per cent for businesses.
Miller also said the funds will also go towards improving city services and ensuring Toronto has a balanced budget next year as the city is handed over to a new council after this fall's municipal election.
The extra money is a result of the city's cost-containment measures, a reduction in property assessment appeals, increases in parking revenues as well as increases in supplementary taxes from the building industry.
The mayor also said the city's budget committee is taking steps towards implementing a two-year budget blueprint instead of the current one-year plan.
Critics
Current mayoralty candidate George Smitherman slammed the announcement, critisizing the mayor for playing "emotional" games with Torontonians.
He scoffed at the mayor's suggestion that the surplus could be used to freeze TTC fares in 2011.
"Why not roll back the (January 2010) fare increase instead of talking about the future year when he won't be mayor? I think we can do better," he said.
Coun. Georgio Mammoliti, who is also running to replace Miller when he steps down in October, questioned the budget committee's "surprise" surplus discovery.
"How does a city magically find $100 million just weeks after releasing a budget?" he said in a news release issued Wednesday afternoon. "I for one have had enough of the mayor and his run-and-hide way of running this city of late."
Rocco Rossi, a Liberal backbencher who is also running for the city's top job, said the city's apparent balanced budget appears to depend on receiving financial support from the province -- funds that are never guaranteed.
"At the end of the day, there is only one taxpayer and we want to make sure there's a plan," he said.
Rossi said he wants to see the city expand Miller's idea for a two-year budget plan into one that encompasses the next five years.
The announcement came amid rampant speculation that the news conference would be about the mayoralty race.
Miller's office sent out a news release Tuesday evening which said nothing more than that an "important" announcement would be made.
Councillors and political pundits said Miller's team was keeping unusually tight-lipped about the announcement, fuelling speculation the mayor would step down from his post early. Miller announced late last year that he would not be seeking re-election for a third term.
Miller defended the news release, saying "it's very important" that the budget has "significantly improved from a couple of months ago."
