The present government of Ontario has made a number of major changes in the way that municipalities are governed and financed. Some municipalities have been forced to amalgamate despite opposition from their residents. Ontario has also redistributed the responsibilities of the province and the municipalities through the Local Service Realignment Program (LSR). This program is commonly refereed to as downloading. Other major changes include the use of market value assessment for property tax evaluation and the transfer of education funding to the province from the local school boards. This paper is concerned with two aspects of these changes. Are megacities less costly to operate than many small municipalities in a large urban area? The recent amalgamation of the City of Toronto is used to examine this question. Since the amalgamation occurred in 1998, the new city is still adjusting to the changes and only preliminary conclusions can be drawn about this question. The second question is concerned with the impact of downloading on the municipalities. The experience of the new City of Toronto is again used to examine this question.
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Paper provided by York University, Department of Economics in its series Working Papers with number
2002_07.