"I'm not supporting any of those revenue tools," said the mayor as his Executive Committee broke for lunch. "People can't afford these taxes, that's all it is is tax, tax, tax. The city's expensive enough to live in. We don't need extra taxes."
Rob Ford is as Rob Ford does.
Meanwhile, the rest of the city, the region, and the province are about to take yet another step toward reaching a mutually agreeable solution for how to expand transit and relieve the congestion that has already begun to asphyxiate the Greater Toronto and Hamilton Area.
Tuesday morning, City Manager Joe Pennachetti released his hotly-anticipated report recommending the specific revenue tools behind which City Council should formally throw its weight. Council's endorsements are then to be forwarded to Metrolinx for incorporation into their own considerations of which measures should be implemented on a region-wide basis.
Development charges, a fuel tax, a parking levy, and a sales tax are the forms of revenue that staff suggest for immediate enactment. High-occupancy toll lanes, "highway tolls or other road pricing," and a vehicle registration tax are being proposed for later implementation, around 2020, when the first phase of Metrolinx's Big Move projects are complete.
In a way, it's exciting. We're having the adult conversation about paying for transit that far too many leaders have long been unwilling to have.
In another way, however, I think back to what Councillor Gord Perks told me three weeks ago: "I resent being pushed to find, to pick my favourite regressive way of paying for infrastructure, when we had a perfectly good and completely successful way of paying for it progressively, through provincial contributions that were funded by the income tax."
That is, to Perks, the very notion that we require new revenue tools is just a sham to help the province avoid having to raise income taxes.
In a conference call late last week, I asked Premier Kathleen Wynne why her preference was for regressive taxes and fees, rather than income taxes. After clarifying that she hasn't actually taken income taxes off the table, she offered two explanations.
"I want us to consider options that are gonna allow people to see where the money is going," she said, "and to really understand how the dollars that they are paying are building the infrastructure, the transit infrastructure that they need, in order to be able to get home to their families and get to work on time."
In other words, income taxes (which go into general revenues) have become too abstract to be accepted by the public at large; it's more politically saleable to introduce new taxes and fees whose funds are directed to specific projects.
Wynne's second justification was that there's a "concern" that people outside of the GTHA "would be asked to pay for transit that they're not gonna use. My contention is that we need to look at people who are most affected, paying for those infrastructure projects. And I don't just mean people who ride transit, I mean the people who are affected by congestion on the roads because, as I said, they can't get around for their businesses or their family lives."
In other words, it'd be tricky to introduce things on a province-wide scale without people in other parts of Ontario reacting negatively to the idea that they're subsidizing Toronto.
Both of these arguments are understandable, but neither is progressive. Although it is undoubtedly bold to be advocating for taxes in the first place, there is still a particular poltical timidity ingrained in the revenue-tool approach.
The thing, of course, is that you don't get to govern the public you want, but the public you have. And so, our discourse having already been poisoned by decades of anti-tax and anti-government rhetoric, it's unsurprising that people who want to raise money for infrastructure would try to find a way around it. Our transportation conundrum, after all, is more than a little urgent.
As it turns out, a personal income tax is among the things the City's report recommends Council not endorse. The rationale is fascinating:
Many consultation participants raised the issue of the impact of new taxes and fees on those least able to afford them. (The Toronto Board of Health has echoed these concerns). This may have been behind the prevalence of selecting vehicle-based fees and taxes, or commercial tax options, such as the parking levy, development charges and payroll taxes. However, personal income tax, which according to the Board of Health is "the least regressive way to fund transit" was the least frequently selected option in the Ipsos Reid poll, and among the least popular choices in the City's on-line survey and public meeting consultations. It may be that there is poor understanding of how an income tax might be applied, and little trust in how it would be dedicated to Metrolinx.
So the fairest way of raising revenue is also the least popular. (There's more on the topic on page 42 of the pdf.)
As for a corporate income tax (which, as far as I can tell, is the only course deemed acceptable by the provincial NDP), City staff never put it on the table in the first place. And, while they don't support the idea, they don't exactly reject it, either:
Staff were asked why corporate income tax was not provided as an investment tool option. The difficulties with a corporate income tax would be that it was considered difficult to administer on a GTHA basis, and that it was contrary to Provincial (and Federal) economic development policy.
However, the Province should consider maintaining its Ontario corporate tax rate freeze, at 11.5%, rather than reducing the rate to 10% once the provincial budget is balanced. This could generate a total of $1.5 billion provincially, or approximately $750 million GTHA-wide on an annual basis, which could be applied as an investment tool to fund regional transportation expansion.
(They go into more detail on page 46.)
Although staff didn't include a request for a corporate tax freeze among the things that Council should formally convey to the province, there's a decent chance a councillor will move a motion that effect. And Rob Ford will vote against it.
There will always be those like Ford, for whom the very idea of taxation is a coercive act of state violence against individual freedoms (though there's no indication that Ford himself has thought through it that far).
But there are also those who have simply become cynical about the operations of government, and who are unwilling to take it on faith that their tax dollars will be used smartly. The process of turning around that view will take some time, and may require a generation's worth of political and media upheaval.
The Big Move projects, and the dedicated taxes and fees to pay for them, could be a part of rebuilding that trust. The fact that City staff are suggesting road tolls should be implemented as soon as seven years from now is itself a hopeful sign. But perhaps more than just believing that public confidence will be boosted by phase one of the Big Move, they are also assuming, not unreasonably, that Rob Ford will no longer be holding public office.
With a file from Ben Spurr.