Sun, May
29
2011

A Dose of Fiscal Reality

Sun, May 29, 2011

sheppard-subway-tunnel.jpg

Over on a transit mailing list that I help manage, covering the Greater Toronto Area, there’s been a few sparks of controversy among the members. A number of transit activists see Toronto Mayor Rob Ford’s policies as detrimental to the long term growth and viability of public transportation in Toronto. They’ve come up against a number of other posters who tired of David Miller’s term as Toronto Mayor, and generally support Ford’s different approach of doing things.

This is a bit of a challenge for the mailing list, as it’s not used to flame wars, and has generally conducted itself in an a-political manner (or, as a-political as one is when one is generally supportive of public transit). Fortunately, this history of amicability has helped keep things in check, along with a few reminder from the moderator (i.e., me) to attack ideas and policies, and not the people behind them.

As you well know, I’ve had issues with Rob Ford’s policies before, but there are right ways and wrong ways of addressing them. Far too often, I’ve heard critics of Ford call him “a fat (insert epithet here)”, and I have to ask, is that really constructive? How does Ford’s weight relate to the policies he produces, and why should it be a point of attack?

Besides, I could do with losing a few pounds myself, so I’d appreciate it if the weight of one’s opponent wasn’t the primary basis of one’s criticism.

On the other side, I’ve heard too many excuses to shield Ford’s administration from criticism. Some have said (and I’m paraphrasing here), “well, whatever you may think, Ford was elected with a strong majority, and he currently has a 70% approval rating, so there!” Never mind the fact that Ford won a plurality, rather than a majority of the vote (47%, which means 53% of Toronto voters favoured other candidates), this is essentially saying, “Ford won. Get over it. Sit down and shut up.”

Well, last time I checked, I had a right to have an opinion, and citing Ford’s non-existent majority and using that as a sole basis of shooting down my argument, isn’t very constructive either. Whether you like it or not, it is my right to criticize the Ford administration, and it benefits the Toronto body politic for two reasons: one, there’s a remote chance that Ford or his handlers might read a rational criticism against Ford’s policies and be moved enough by it to make improvements for the benefit of all Torontonians and, two, it helps construct a rational rebuttal of the Ford administration, the better to beat him in the 2014 election. So, if you intend to tell me that my criticism of Ford’s policies are invalid because he has a majority and shut up, you can respectfully go to Hell.

And I’m not surprised that Ford currently enjoys a 70% approval rating. I, for one, didn’t buy the doom and gloom of the anti-Ford naysayers that Ford’s election would ruin the city on December 1, 2010. Toronto is just too resilient for that. Besides, there’s the small matter of the $300 million surplus that David Miller left behind. That money has helped fund Ford’s many fiscally irresponsible acts in 2011, including canning the Vehicle Registration Tax, blocking the TTC’s fare increase, and granting the police union a higher-than-inflation wage increase. Put simply, Ford has coasted through his first year in office thanks to David Miller’s gift. The real impact of Ford’s mayoralty hasn’t been felt by most Torontonians, and it won’t until 2012, when Rob Ford will be called upon to close the $750 million operating shortfall that’s currently on the city’s books.

Let’s see then if he’ll manage to live up to his campaign promise to cut taxes “without any service cuts” (to be fair, he later amended this with the weasel words, “without any major service cuts”). It’s easy to like Ford when he cuts a $62 million tax, but doesn’t close community library branches, pools, hockey rinks, or rush hour buses. When real service cuts come to hit the TTC, when community centres close, ice time vanishes, and pools sit empty during the hot summer months, how will people react to a city that has just become leaner and meaner, in ways that affect them personally?

It’s at this point that people will start pointing out that Ford promised that stopping the gravy train would enable the city to lower taxes while maintaining services, but the math isn’t adding up in Ford’s favour. Privatizing garbage collection for half the city will only save $8 million. Going through department budgets line by line, and going after the overspending of previous councillors, like Adam Giambrone’s $3000, will barely net more than a million. It’s all well and good to go after these efficiencies, but at the end of the day, the Ford administration is only going to have saved around $50 million. Congratulations guys; that is time well spent. But you still have $700 million to cut. You are now going to have to go after things that you previously did not label “frills”.

Signs of the coming unravelling can already be seen as Ford pushes forward his fiscally irresponsible plan to complete the Sheppard subway. Never mind that Ford is spending $4 billion to build a major piece of infrastructure that far exceeds the demand of the route it serves when an LRT line costing a quarter of that value was already funded, and would have served more of Sheppard Avenue. So dogmatic was Ford’s antipathy towards surface transit that, if reports are to be believed, he turned down a provincial offer of $2 billion towards his beloved subway, on the condition that the provincially funded Eglinton LRT be allowed to operate on the surface between Laird Drive and Kennedy station.

I can’t help but shake my head at this. That’s $2 billion turned aside because Ford wasn’t willing to widen Sheppard Avenue to put LRT vehicles in the middle. Instead, we’re left with infrastructure that’s way overbuilt, and which will be of use to far fewer people. Where’s the respect to taxpayers?

And by turning aside the $2 billion, Ford now has a $4 billion subway proposal that’s almost completely unfunded. And yet, his campaign promised that the line would open in time for the Pan-Am Games. Does that sound sensible to you? He might get money from the federal government, but the related government infrastructure program he’d access only has a budget of $1.25 billion, to be earmarked for the whole country. He’s talked about development charges, but the funds raised by these measures are woefully insufficient. Now, I’m told we’re looking at rerouting development charges around the Eglinton LRT, and possibly a fire sale of City property to try and close the gap. Not only is this fiscally irresponsible — selling the refrigerator to pay for a new mansion — it won’t close the gap.

In a blast of rare political candour, Gordon Chong, the man picked by the Ford Administration to kickstart the development of the Sheppard subway, has said that Ford’s proposed funding of the Sheppard subway just won’t work, and that if the administration wants the line to be built, they’ll have to impose some serious tolls and taxes.

“People don’t like it when you tax them and the money disappears. If you tax them and they can follow the money trail to transit, they won’t like it but they will understand it,” he says. “Everybody in the world is paying tolls, what’s so special about us?”

Chong concedes that a segment of the population — maybe even the Ford administration — believes the private sector will build the Sheppard subway extension wholly on its own, with a little help from the federal infrastructure fund.

But that federal fund has only $1.2 billion for the whole country. Sheppard will end up costing as much as four times that amount. Vancouver tapped into the federal government’s public-private fund to complete the Canada Lands rail line, but the Sheppard line will cost twice as much.

“Is there going to be the political will to look at all the potential tools? If you want to get back in the subway building plan you have to consider everything,” Chong says.

Besides tolls and congestion charges, the plan will need contributions from the federal government. And developers who benefit from the presence of subways near their property should have 20 per cent to 40 per cent of the increased value clawed back development fees, Chong says.

“Everything that can potentially generate revenues should be on the table,” Chong says.

(link)

I have to give Gordon Chong a lot of credit for having the courage to speak up like this and address some uncomfortable political realities. The fact is, if you want good government in your city, you’re going to have to pay for it. If you want a good public transportation system, you’re going to have to pay for it. The idea that you can have a good city with good infrastructure without some sort of tax burden is pure bunkum. And I similarly have to commend deputy mayor Doug Holiday for not dismissing Chong’s comments out of hand.

I have my doubts that Rob Ford would go back on his promise to avoid tolls in order to build the Sheppard subway. It would be politically difficult for him to impose tolls (likely $5 tolls on the DVP and the Gardiner Expressway), as those car commuters who rejoiced that the hated Vehicular Registration Tax was lifted would now have to pay a substantially higher burden for the privilege of using Toronto’s roads. However, if he doesn’t do this, the Sheppard line won’t get built, and he will have broken a major campaign promise in any event. If he does go forward with road tolls, I will be impressed. The Sheppard subway may be overbuilt, but it will be built. And Rob Ford would have put his money where his mouth was.

However, I would have to point out that the previous administration had planned a much larger network of rapid transit lines stretching across the city. The proposals were in place, funding was secured, and construction had started. And they were able to pay for these lines without resorting to development charges or road tolls to get it done.

It sort of puts paid to the suggestion that the previous administration was fiscally irresponsible, and that Rob Ford respected taxpayers, doesn’t it? Rob Ford is about to learn that running a city is a lot harder than he led voters to believe. Let’s hope he truly respects taxpayers enough to level with them when his tax cuts prove to be unaffordable.


(Update: Tuesday, 7:25 a.m.): Aaaaand Ford says no road tolls. Specifically, he says, “It’s nonsense, I don’t support road tolls and there’s no road tolls going in.” So, basically, the Sheppard subway he campaigned for is going to be built with pixie dust.

Not really a surprise. This illustrates everything I’ve talked about. Rob Ford is so dogmatic, he’ll do his own administration serious injury by the time the next election rolls around in 2015. The parallels between him and Ottawa’s Larry O’Brien continue.


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