The purpose of this report is to provide a financial update and outlook to inform the City of Toronto's long-term financial planning and forthcoming updated Long-Term Financial Plan (LTFP). Following the 2023 Budget, with the support of an independent third-party, the City has updated its financial model to assess the long-term fiscal risks anticipated in the next ten year period. This updated analysis expands on previous work completed by the City of Toronto and will help to inform future phases, including an updated LTFP to be presented to City Council later in 2023. The updated financial model highlights the significant challenges that the City will face over the next ten years including both operating and capital budget pressures. The City currently has limited tools or strategies to address a challenge of this magnitude, demonstrating a need for enhanced analysis of potential options. For example, as reported in the September 30, 2022, quarterly updates, over 97% of the City's deferred revenues and reserve and reserve fund balances are fully committed, leaving just $290 million available for emergency or one-time back-stop purposes. Beyond immediate and urgent financial challenges the City faces, municipalities need a new fiscal framework to address ongoing challenges with predictable, long-term funding. The updated financial outlook will be used to inform intergovernmental discussions. Staff continue to engage with their intergovernmental counterparts to promote ongoing and sustainable funding support. Further exploratory work to determine appropriate solutions and offsets will be completed throughout 2023, including an additional analysis of revenue tools as was requested by City Council.
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