How Toronto could solve its revenue woes and fight climate change

A commercial parking levy could raise $171 to $535 million a year with a daily tax of 50 cents to $1.50 for a parking spot.


I have just returned from the United Nations Conference of the Parties (COP22) in Morocco, where thousands gathered to nudge forward the global agenda on climate action signed in Paris last year. 

Mixed emotions were on display: delegates celebrating the Paris agreement were deeply shocked by Donald Trump’s victory. U.S. Secretary of State John Kerry tried to put a brave face on things, but we all understand that Trump’s presidency means an enormous step backward in global efforts to tackle climate change.

At panel discussions across the COP22 venue, speaker after speaker pointed to the growing role of cities and regions in spearheading solutions. Ontario Minister of the Environment and Climate Change Glen Murray asserted that many American mayors and state governors will continue to pursue this work. The C40 Mayors, the Global Compact of Cities and many other organizations are committed to driving an ambitious environmental agenda. The Federation of Canadian Municipalities continues to frame a progressive role for cities large and small. 

In Canada’s largest city, it’s time to take stock of what we can do.

The TransformTO process is under way, developing a detailed plan for Toronto’s climate and energy goals for the coming years. We can build on past achievements: the 25 years of innovation spearheaded by the Toronto Atmospheric Fund, and the Better Building Partnership’s retrofitting of buildings to cut 680,000 tonnes of CO2. 

But we must also acknowledge huge gaps: $2.6 billion of needed repairs on Toronto Community Housing stock another $1 billion for school buildings and the TTC anxiously scrounging for funds to keep more than 1.5 million passengers moving daily. We are the child poverty capital of Canada.

It’s not that there isn’t lots of money in this town. Loads of it flies around in speculative stock deals, mergers and acquisitions and CEO bonuses. The 1 per cent are doing very well. 

But city council is now struggling to find the revenue needed to keep delivering the public services so vital for a healthy city – not just bricks and mortar, but the social infrastructure that provides a measure of equality for everyone. 

We all know that wages have stagnated for most people in the last decade, and too many young people are working in precarious jobs. So how do we raise the money to invest in what is needed for communities, and do our part for the environment? 

Selling off public assets, as Mayor John Tory has suggested, is not the answer.

The Parking Authority and Toronto Hydro generate tens of millions of revenue dollars for city coffers. They are huge income-makers, which is exactly why Bay Street would love to take them over. 

On the Hydro front, a very sophisticated game is afoot. You only have to track the mayor’s language around inadequate wiring and transformers, a script worthy of a seasoned spin doctor to see how the decision to cut Hydro’s dividend was designed to ease the way to a sale. (Nick Kouvalis’s deft hand at work?)

It mirrors Mel Lastman’s plan 15 years ago to privatize Toronto’s water system. Back then it was worth $19 billion, and the private water firms were hovering like vultures over carrion. No matter how often Mel and his team claimed they had the best interests of the public at heart, it became obvious that a scheme was in place. 

A major public fight derailed that attempt, fuelled in part by strong feelings about privatization in the wake of the Walkerton tragedy. 

But a different dynamic is at play these days as both the federal and provincial Liberals trumpet “asset recycling” – a term meant to disguise a massive power grab by wealthy interests.

Some politicians throw up their hands in exasperation to conclude that we have no other option. “Can’t raise property taxes,” they say. “What about the poor widow in her bungalow?” 

So let’s leave her alone and concentrate on those who have ample means to contribute. 

The KPMG report on city revenue tools clearly shows one option above all others that makes sense both financially and morally: a commercial parking levy that could raise $171 to $535 million a year with a daily tax of 50 cents to $1.50 for a parking spot. It would be paid by the richest landowners in the city. We’re talking serious money, and the chance to stabilize Toronto’s finances for years to come.

There could be an exemption for small strip malls. They don’t enjoy the same kind of revenue as the big boys – an 18 per cent increase in one year for Yorkdale, 33 per cent for Royal Bank Plaza, 8 per cent for the Eaton Centre and Fairview. You get the picture. That’s why the big commercial landlords have their lobbyists furiously working the halls of 100 Queen West to derail any attempt at this sensible solution. But it really is the only option of the magnitude to provide real investment in Toronto’s future. 

We could also claim the income from the hotel levy that Dalton McGuinty denied us in the original City Of Toronto Act. Every other major city derives funds from hotel visits, and Premier Kathleen Wynne has signalled that she’s willing to entertain the idea.

But it alone won’t provide the amount needed for serious work or make up for the loss of land transfer funds when the real estate market cools down. 

So let’s focus on fairness and ask those with the most resources to contribute their share to keep Toronto a livable city. For affordable public transit, decent housing, accessible recreation for our youth and services for seniors, everyone needs to pitch in. 

And if we’re going to reduce our city’s carbon footprint, we’ll have to reduce energy and water use, divert waste and adapt for extreme weather events. There will be paybacks later, but first we have to invest.

John Cartwright is president of the Toronto & York Region Labour Council.

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