Mississauga facing $60 million deficit due to pandemic, recommending closure of over 100 projects


Published April 29, 2021 at 8:54 pm


Over a year into the pandemic and more than five months into a second lockdown, the City of Mississauga is facing another multi-million dollar deficit. 

At an April 28 budget committee meeting, Gary Kent, Commissioner of Corporate Services and Chief Financial Officer, said that the city is facing a deficit of $59.9 million for 2021. 

The city was able to receive enough money from the federal and provincial governments through the Safe Restart Agreement to cover its 2020 deficit. 

Under current provincial regulations, municipalities are not permitted to run deficits. 

“The anticipated year-end deficit projection for 2021 is currently estimated to be $59.9 million. The deficit is primarily due to reduced revenues, particularly in MiWay, recreation and regulatory services service areas,” Kent said in a statement 

“The long-term loss of Payment In Lieu of Taxes (PILT) revenues from the Greater Toronto Airport Authority (GTAA) is projected in 2022.” 

In a statement, Kent said that city staff is reviewing potential actions to address future shortfalls such as by “aggressively managing costs,” monitoring revenues and advocated for help from higher levels of government. 

Kent said current federal and provincial funding will not be sufficient to fully offset 2022 and 2023 pressures, and PILT revenues will not return to pre-COVID levels for many years if the legislated five per cent cap on PILT revenues continues. 

“Mississauga has been in lockdown since November 2020, and the City, along with Mississauga residents and businesses, continue to face significant financial hardships,” said Mayor Bonnie Crombie in a statement. 

“The reality is that public health measures such as the stay-at-home order have severely impacted many service areas. Transit ridership and revenues have significantly decreased, along with revenue and user fees from our recreational and cultural facilities. Our costs have remained the same, while our revenues have plummeted.”

Since the onset of the pandemic in 2020, council has deferred property tax payments and stormwater payment due dates, temporarily suspended parking enforcement, deferred rent payments from tenants in city facilities, deferred collection of the Municipal Accommodation Tax (MAT or “hotel tax”) and temporarily suspended fines, penalties and late fees for property tax. 

To offset some financial challenges, the report recommends that 137 projects be closed. The report also says $6.9 million is being returned to various reserve funds. 

According to the report, staff are recommending that over $2 million be transferred from the Mississauga Bus Rapid Transit (BRT) reserve fund to the capital reserve fund and the account be closed. Staff are also recommending that about $10 million be transferred from the MoveOntario 2020 Higher Order Transit reserve fund to the capital reserve fund and that $840,358.46 be transferred to stormwater pipe reserve fund from the operating program surplus. 

The city says recommended adjustments to the capital program will result in a revised net capital program of $134.9 million with 95 active projects. 

“The COVID-19 pandemic continues to significantly impact City operations in 2021 and revenue shortfalls will continue into 2022 and beyond. We are using a progressive approach with good financial thinking to support the City’s goals. With this in mind, we have started early, knowing what is ahead will require real-time information,” said Paul Mitcham, City Manager and Chief Administrative Officer, in a statement.

“City staff continues to mitigate the financial impact of COVID-19 where possible, including continued hiring delays, temporary staff layoffs where facilities have been closed, and aggressively managing costs. Prior to the application of the federal-provincial Safe Restart Agreement, the City was in a deficit position of $55.5 million in 2020. Funding received through the Safe Restart Agreement enabled the City to reduce the deficit to zero that year. The continued revenues lost from transit and recreation and other traditional sources of revenue are an ongoing reality.”

Staff will report on an updated year-end position in June.

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