OTTAWA – The annual conference of the Association of Municipalities of Ontario is one of the signature events of the provincial political calendar, with MPPs and cabinet ministers flocking to Ottawa to hold meetings with municipal officials from all over the province and to hear from mayors and councillors. It’s a week in which Ontario’s 444 cities, towns, and villages can make their voices heard both individually and collectively.
This year, outgoing AMO president Robin Jones opened the conference with the return of a topic that’s been muted for much of the last decade: the need for a reformed fiscal arrangement between municipalities and the higher orders of government. In the shorthand of governance wonks, it’s the return of “a new deal for cities.”
“We need to speak in plain, everyday English about how provincial decisions show up in local taxes and services, and how the province connects to the municipal sector,” said Jones. “You often hear that municipalities are creatures of the province. This is a constitutional fact, but constitutional authority should not be confused with good governance. Municipalities are democratically elected governments, not administrative branches of the province.”
Jones’s remarks echoed those of Ottawa mayor Mark Sutcliffe, who expressly called for some kind of new fiscal arrangement to support cities. “Municipalities are punching above their weight, but the weight keeps getting heavier and heavier,” Sutcliffe said, alluding to municipal responsibilities for transit, housing, and social services. “That doesn’t make sense anymore, and I think everyone in this room knows it.”
Sutcliffe said that new supports for municipalities could include a dedicated share of the HST, among other measures — he wasn’t ruling anything out — but said the conversation needs to start at the AMO conference this week.
It’s all a bit of déjà vu, because the fiscal problems facing municipalities aren’t particularly novel. AMO called for a similar fiscal change a decade ago; in 2017 the association proposed giving municipalities a share of the HST only to have the Wynne government of the day shoot that proposal down (the fact that an election was a year away at that point was a relevant factor). Before that, of course, the federal government of Prime Minister Paul Martin announced a “new deal for cities and communities” in 2005 that did not survive a year before his Liberals were replaced with Conservative Stephen Harper, who had a different vision of the relationship between the different orders of government.
The problems are familiar because Ontario doesn’t address the underlying imbalance: municipal responsibilities grow faster than their revenues do, and those responsibilities are for the most part non-negotiable. Ontario’s case might be even more egregious than other provinces, where billions of dollars in health care spending is borne at the municipal level that would be paid for provincially in most other provinces, including capital funding for hospitals as well as, increasingly, the costs of recruiting and retaining doctors to serve in some communities. These costs and more were detailed in AMO’s 2026 pre-budget submission to the government.
This is an entirely acceptable bargain for Queen’s Park: costly local services get pushed off the provincial balance sheet, freeing up room for provincial priorities (whether that’s spending elsewhere or tax cuts); when the crisis in municipal budgets becomes bad enough, the premier of the day can ride to the rescue with a (time-limited or even one-off) financial rescue package. It’s understandably frustrating for municipal leaders.
Municipal leaders have been demanding that someone give them the money to match their responsibilities for the entirety of my adult life. Recent decisions of the Ford government, however, point towards an entirely different way this could be settled: with the province taking more direct control over municipal decision-making entirely. Earlier this year the government introduced Bill 100, the Better Regional Governance Act, which replaced the chairs of regional municipalities throughout the Greater Golden Horseshoe with provincial appointees, and gave those chairs the “strong mayor” powers enjoyed by other elected mayors around the province. With the power to override council majorities at the regional level, someone ultimately appointed by the premier’s office will now have enormous power over the lives of millions of Ontarians.
The decision from the Ontario Court of Appeal last week in Cycle Toronto v. Ontario reaffirmed the province’s legislative power over local affairs, and of course the Supreme Court of Canada had previously found that Ford’s decision to cut Toronto City Council in half in 2018 was a constitutionally-permissible use of legislative power. In both instances, the takeaway is that Charter’s guarantees did not pose a serious obstacle to a provincial government that wants to run municipal affairs.
It’s not difficult to imagine local politics spiraling into a kind of doom-loop in Ontario: more and more provincial intrusion causes fewer people to run for elected office, causing more dysfunction at the local level, which in turn invites more provincial intrusion, and so on. The net result could be “municipal affairs” that look much like education policy does today: nominally delivered by local school boards overseen by elected trustees, but with functionally every important decision already made by Queen’s Park.
Premier Ford, for his part, extolled the virtues of local elected officials when he spoke at the AMO conference on Monday.
“I’ve walked a mile in your shoes… when Mrs. Jones calls you about a sewer or a cracked sidewalk, you’re literally on their front door,” Ford said. “Sometimes I forget that I’m not a city councillor anymore.”
For at least some of the people in the audience, those words weren’t reassuring.