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Provincial budget cuts creates $1.3M gap in daycare funding at city

City agreed to add spaces as long as province paid for them; new government changed funding formula 
Changes to a provincial funding formula mean that daycare spaces Greater Sudbury had added since 2017 under the assumption the province would pay 100 per cent of the cost will now cost local taxpayers $1.3 million a year beginning in 2020. (File) 

As it attempts to deal with its huge budget deficit, the Doug Ford government downloaded daycare costs to municipalities in the recent provincial budget.

On Tuesday, city councillors learned how much those cuts are going to cost local taxpayers: $1.3 million a year beginning in 2020.

Ian Wood, the city's interim GM of community development, told members of the finance committee that beginning next year, the Ontario government will only cover 80 per cent of the costs of 204 new daycare spaces that have been created since 2017.

The city agreed to add the spaces with the understanding the province would pay 100 per cent of the operating and administrative costs, Wood said.

The last expansion – adding 67 spaces at the YMCA where the city used to run its own daycare – was delayed this year until the budget details were release, he said.

"Previously, these expansion spaces were funded 100 per cent by the province," Wood said. "The new government has changed the rules."

The project is ready to go this year, but the funding changes means city has to commit $47,000 a year for operational funding for those spaces. And in future years, the city will have to find an additional $1.3 million to fund the 204 spaces that are no longer funded 100 per cent by the province. 

However, there is $6.3 million available to ease the transition, Wood said, funds leftover from the former Liberal government to smooth out funding changes it announced.

"But at some point, that mitigation funding will be used up and we will be covering that ($1.3 million) from the levy," Wood said.

Ward 9 Coun. Deb McIntosh said it was unfair city council was now in the position of having to pay for daycare spots because the province unilaterally changed the rules. 

"We did not know at the time when we accepted the money to build this expansion, we had no idea the government was going to reduce the funding, and that we would have to put these costs on the levy for all these new spaces," McIntosh said.

"So we're kind of stuck, it seems to me, unless we say we're not going to go ahead with these additional spaces at the YMCA. It's an unfortunate position we've been put in."

Ward 4 Coun. Geoff McCausland went a step further, accusing the province of forcing cities to take on new costs for provincial initiatives.

"This is the Conservative provincial government raising taxes,” McCausland said. “They're downloading costs to municipalities."

He suggested the city consider using the $6.3 million fund to cover all of the download costs, with the expectation a new government will be in place by the time the fund is exhausted.

"Hopefully in four years this government will no longer be there to download costs," McCausland said.

Those decisions will come during the 2020 budget process, McCausland was told, although staff was recommending using the money to gradually bring in the increased costs. 

Shorter term, the committee approved the $47,000 in operating costs for the new spaces at the YMCA.