01/06/2012 02:35 EST | Updated 03/07/2012 05:12 EST

City Council faces tough choices about surplus

Toronto’s City Council will soon decide how to handle a larger-than-expected surplus from 2011, which is now estimated at $154 million.

The city has ended up with the extra money in its pockets because of increased revenues from the land transfer tax.

On Friday, Mayor Rob Ford said the surplus was “good news for Toronto taxpayers,” as it can help pay for expensive capital projects that the city has planned.

“This money will help us pay for capital purchases we need to improve transit in Toronto,” Ford said in a statement posted to his Facebook page.

Budget chief Mike Del Grande and city staff say the majority of the surplus should be used for capital projects.

But many city councillors want to use some of the money to stave off $80 million in possible cuts to wading pools, homeless shelters and other selected programs.

Meanwhile, Ford is supporting a staff proposal to use $2.5 million in funds to protect 58 student nutrition programs and programs at 12 community centres that are at risk of cancellation.

Ford is supporting the proposal because it is backed by stable funding, which has resulted from $8 million in increases to the permanent property tax rolls.

“We asked them to find a way to protect funding for these programs and I'm very pleased to say they succeeded,” Ford said in a statement given to CBC News.

The budget committee will consider the recommendations on Monday.