Toronto’s next funding talks with Ontario are set to begin in a more difficult political climate after Premier Doug Ford rejected Mayor Olivia Chow’s request for a second financial agreement between the province and the city. Ford said Wednesday there would be no “Deal 2.0,” while leaving open the possibility of discussions on selected priorities.
The dispute comes after Chow’s re-election as mayor in October. Her staff subsequently confirmed that she was working toward another version of the Ontario-Toronto New Deal, the arrangement negotiated after her first election in 2023 to address a projected $1.8-billion municipal deficit. The original package included provincial operating assistance and relief from major capital responsibilities.
Existing support faces a deadline
Under the first agreement, Ontario provided about $1.2 billion in operating support and delivered approximately $7.6 billion in capital relief. That relief included the province taking over responsibility for the Gardiner Expressway and the Don Valley Parkway. Ford characterized the overall arrangement as a $9-billion package when speaking to reporters at Queen’s Park.
Those highway transfers were described as one-time measures in the source material. Meanwhile, provincial funding connected to transit and shelter support is scheduled to expire next year. That timing adds pressure to the city’s effort to secure a longer-term arrangement, even as the premier argues that Toronto must carry greater responsibility for its own finances.
“No, there is no [Deal] 2.0.”
Ford said the province was prepared to work with Chow on “certain priorities,” identifying police officers in subway stations and broader crime reduction as areas for discussion. He also said Toronto could not always depend on provincial assistance and that Ontario would act as a “prudent fiscal manager” while working with more than 400 mayors across the province.
City seeks talks on shared priorities
Chow’s office did not respond by escalating the disagreement. Her press secretary, Braman Thillainathan, said the mayor looked forward to meeting Ford and discussing co-operation in areas that included housing, transit and public safety. Chow is scheduled to be officially sworn in later this month, according to the source material.
The exchange also links the funding discussion to public safety, an issue that featured prominently in recent municipal politics. Coun. Brad Bradford campaigned on hiring 1,000 additional police officers and placing police in every subway station. Chow has also said she would hire more police officers. Ford’s comments indicate that policing could form part of a future provincial-municipal conversation, although he did not commit to a new financial package.
| Issue | Position or status |
|---|---|
| Second New Deal | Ford says there will be no Deal 2.0 |
| Transit and shelter funding | Existing provincial support is set to expire next year |
| Possible discussion areas | Housing, transit and public safety |
| Existing capital relief | Includes the Gardiner Expressway and Don Valley Parkway |
Myer Siemiatycki, professor emeritus in the politics and public administration department at Toronto Metropolitan University, said Chow would likely proceed carefully as she seeks additional provincial funding. The immediate question for city officials is therefore not whether the earlier deal will simply be renewed, but whether separate commitments can be negotiated before scheduled support ends. For Toronto residents, the outcome will shape the financial conversation around services that the mayor’s office and the province have identified as shared priorities.
