AMO finds pros and cons in 2025 Ontario budget

The Ford government’s recently released 2025 budget – A Plan to Protect Ontario – included several municipal investment initiatives aimed at supporting infrastructure, housing, and local economic development. It also, according to Finance Minister Peter Bethlenfalvy, focused on protecting workers and businesses in the face of U.S. tariffs and continued economic uncertainty.

Bethlenfalvy said the budget furthers the government’s goal to transform Ontario into the most competitive place to invest, create jobs, and do business while investing even more in health care, education, and other critical services.

“Our government is delivering on our mandate to protect Ontario and help workers and businesses weather the storm while creating the long-term foundations for a strong, resilient, and competitive economy,” Bethlenfalvy said. “We’re making the investments in workers, infrastructure, and services that will protect Ontario, no matter what.”

General highlights of the budget include:

• economic relief and business support through the Protecting Ontario Account, a $5 billion fund to help businesses facing tariff-related disruptions
• infrastructure and transportation investments for highway expansions and hospital construction, with $33.3 billion allocated for infrastructure projects
• housing initiatives where municipalities may be eligible to reduce property taxes on qualifying housing by up to 35 per cent starting in 2026 – with the intention of easing affordability concerns
• Northern Ontario investments that will include $3 billion for Indigenous Opportunities Financing, along with continued funding for highway upgrades and economic development

AMO’s Budget Perspective

Lindsay Jones, Director of Policy and Government Relations with the Association of Municipalities of Ontario (AMO), said the province’s efforts probably achieved at least some of Premier Doug Ford’s stated goals.

Jones described “A Plan to Protect Ontario” as a budget for the economy. And in the context of the current economic climate, she added, that’s something that municipalities 100 per cent support. Investments were made not just for businesses but also for workers, as well as a new fund for trade-impacted communities.

The most significant investment from the municipal perspective was the additional $400 million in housing-enabling infrastructure, in both the support for water systems as well as the broader municipal infrastructure fund.

Other municipal-focused highlights of the budget included the following:

• Ontario Municipal Partnership Fund will see the province continue financial assistance to municipalities with allocations varying on a case-by-case basis.
• Public transit and roads investments will include GO Transit refurbishments while the province remains committed to twinning Highway 69 and advancing the 2+1 highway initiative.
• The Trade-Impacted Communities Program will receive $40 million to assist municipalities and industries disproportionately affected by trade disruptions.

For her part, Jones pointed to what she saw as unexpected successes, as well as a few unfortunate omissions.

Jones said AMO members were “pleasantly surprised” to see a commitment to trying to address some longstanding issues around provincial offenses courts. These are the courts that municipalities run to address offenses under the Highway Traffic Act and others. In Ontario, there’s around $2 billion in outstanding fines.

“It’s a longstanding issue that has impacts for many municipalities,” Jones said. “We were really pleasantly surprised to see a commitment to try and move forward and address both the fine collection, but also kind of thinking of new ways to make that system work better.”

Other Side of the Coin

While there were successes in the budget, Jones said she sees areas where the province could have focused greater attention.

AMO, Jones said, had put together a “robust proposal” around how there is no better destination for stimulus funding than municipal infrastructure. In times of economic downturn, Jones said municipalities remain the quickest, most efficient way of getting dollars into the economy.

Jones said AMO had been hopeful for a greater investment in municipal infrastructure, particularly given the recent provincial election platform where Ontario’s Progressive Conservative Party had committed to another $2.3 billion for municipal infrastructure.

While municipalities are grateful for the $400 million, Jones said she remains hopeful that this was “a bit of a first step” in a broader package.

But most importantly, Jones said, she was hoping for the province would have paid more attention to AMO’s pre-budget submission was social housing.

This was, she said, a real opportunity, both from the perspective of moving forward in addressing the widespread housing affordability challenges, the homelessness crisis that’s currently unfolding in Ontario, but also from a stimulus perspective.

“Investing in social housing, we thought, was a real win-win from a variety of perspectives,” Jone said. “We’re still hopeful that that is an area we can continue to work with both the provincial government and the federal government around.”

Good Relations with the Province

AMO puts a lot of time and effort into advocating with provincial officials on a wide range of topics. As such, the organization can often see where those efforts result in supports offered by the province.

Jones said there is “definitely no question” that AMO has been focused on the housing-enabling infrastructure. As such, the organization is proud of the investments there. Jones said AMO is also proud of the enhanced investments in the heart hubs – the homelessness and addiction recovery treatment centers.

These were investments that the province had announced last August at AMO’s conference. However, the province did almost double the investments they agreed to put into these kinds of integrated wraparound service hubs.

Jones said the AMO team works “incredibly hard on behalf of our members.” But it’s not just the AMO team; it’s also individuals who are working both at the elected level and at the staff level in municipalities across the province.

The importance of unity between municipalities and the province, Jones said, has never been more important. This is especially so amid economic uncertainty created by U.S. President Donald Trump’s trade war.

“I do think that we feel the relationship with the provincial government is in a really good place these days,” Jones said. “We feel like municipalities are really being heard. We recognize that there are a lot of tough decisions that need to be made, and we’re confident that we’ve got a strong voice with this government going forward.”

Focus Shifts to What’s Next

Sure the budget has been set, and municipalities know what they’re dealing with. But Jones said it’s not like the AMO team is suddenly going to take the next six months off.

Jones acknowledged the province has been “incredibly active already from a legislative perspective” in the first few months of its mandate. As such, AMO is focused on engaging on some significant pieces of legislation.

Perhaps the most significant piece of legislation is the controversial Bill 5 that would create special economic zones for the purposes of economic development. The province, Jones said, has proposed being able to override both provincial and municipal laws and bylaws. As such, that is obviously something Jones said is “of significant interest to us.”

There’s also legislation around community safety where AMO continues to make the case that enforcement alone is not going to dig Ontarians out of the homelessness crisis.

Jones said there is another area that, from AMO’s perspective, needs considerable focus.

“That’s legislation around municipal codes of conduct that has been reintroduced. That’s an issue that AMO has been pushing for over a number of years,” Jones said, “We’re very hopeful that we’ll be able to see put into place standards and approaches to being able to ensure that municipalities can hold themselves to account for a higher standard of behaviour.”

How to Create Change

The debate over development charges and red tape is intensifying as municipalities grapple with the need for funding while also striving to make housing more affordable.

Some argue that slashing red tape and cutting development charges is necessary to speed up construction. Others caution these measures are critical for ensuring municipalities can fund necessary infrastructure. Balancing these competing priorities, Jones said, remains a major challenge that requires adaptability.

Jones emphasized the importance of teamwork and innovation. She also stressed the need to stay flexible and explore fresh ideas while remaining dedicated to shared objectives. Now, she said, might be the right moment to take a chance on an approach that previously seemed unlikely.

But even so, everything can’t happen at once.

“We’re trying to start in areas where we think that there are some real opportunities, but it’s not boiling the ocean all at once,” Jones said. “Can we push ourselves in collaboration with our colleagues to find some different ways of working that might make things better for everyone?”  MW

✯ Municipal World Executive and Essentials Plus Members: You might also be interested in Zachary Spicer, Joseph Kushner, and J. F. Lamarche’s article: Political budget cycles in municipal governments.

Sean Meyer is digital content editor for Municipal World.

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