Famously debt-free Mississauga will go into the red next year for the first time in more than three decades.

Director of Finance Patti Elliott-Spencer confirmed Tuesday that in 2012 the city will borrow the first part of $450 million it will need to spend rehabilitating infrastructure. The loans will be spread out through 2020 as Mississauga’s sprawling growth slows and developer dollars dwindle, while the city tackles its aging sewers, roads, transit systems and the like.

The upcoming debt and a proposed 10.8 per cent city property tax increase mark the end of a gilded era for Mayor Hazel McCallion, who has prided herself on the city’s debt-free status over her 33 years in power.

McCallion has often been quoted as saying she runs Mississauga “like a business.” But, secure in her popularity, she has not run a real campaign for several elections and in the process failed to put up for public debate any kind of a comprehensive financial vision for the city. She did not respond to a request for comment Tuesday.

“Every city that matures finds itself in this situation,” Elliott-Spencer said of the decision to borrow. Avoiding debt was easier in the years when the city’s population was quadrupling and there was a steady flow of growth-related revenues from developers.

The need to go into debt was recognized three or four years ago. The first debt issuance was originally forecast for 2013, but that’s now been bumped ahead by a year, Elliott-Spencer said.

The bad news doesn’t end there. The city has also proposed a staggering 10.8 per cent hike on its share of the 2012 tax bill (with Peel Region and provincial education taxes making up the rest).

In addition, Mississauga has already passed a transit fare increase and approved substantial transit service cuts. Fee increases are also proposed for a wide variety of recreational activities, parking fines and business licences.

A formal budget proposal goes to council Dec. 12.

The debt is perhaps the most alarming signal of the changing times in Canada’s sixth largest city. Even with the $450 million in loans, the city still faces a gap of more than $1 billion in infrastructure renewal costs expected over the next 20 years.

McCallion’s critics have long said her politically popular move of keeping tax increases close to zero for years would eventually prove financially disastrous. But in the meantime, McCallion was often critical of the style of fiscal management in neighbouring Toronto.

“I told (then mayor) David Miller: ‘Your taxes last year should have been 5 to 6 per cent (not the 3.8 per cent passed by council),’” McCallion told the Star in 2007.

With reserve funds shrinking and Mississaugans still stinging from this year’s 5.8 per cent tax increase (after staff recommended a hike of more than 8 per cent to council) some might say McCallion should have taken her own advice.

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