Tag

tolls

Browsing
#TOpoli

Executive Committee gets a toll awakening

Toronto’s city councillors got a rude awakening at Thursday’s lengthy Executive Committee meeting. City staff gave a presentation on revenue tolls, saying that it is necessary that council approve at least a few of their reforms — increase property taxes, sales taxes, vehicle tax, or user fees like tolls and public transportation fares. If they didn’t, well, they would have to find more cuts.

Toronto currently has $33 billion worth of unfunded projects. As city manager Peter Wallace said during his presentation, if executive council or city council decides not to approve the use of tolls or increase property taxes, then they better be ready to propose reductions in the capital spending.

“Toronto, a $12 billion enterprise, does require a long term, vigorous, and consistent framework,” he said. “Cutting costs on an annual basis doesn’t work long-term. Toronto needs a long-term investment and revenue strategy.”

Wallace spoke candidly about the need to choose, and implement, a revenue plan. If city council is not willing to increase taxes, then tolls are the only option.

Mayor John Tory announced last week that he would be supporting the implementation of tolls as a source of revenue for infrastructure and transit-related projects. His proposal: a $2 flat-rate toll on the Don Valley Parkway and the Gardiner Expressway. With this toll, the city would accumulate approximately $166 million in extra revenue. If the rate were to increase to $3.90, comparable to the cost of a transit fare, the city would make $272 million.

“If you want to live in a city in five or 10 years that is so much worse for congestion, then we shouldn’t have this discussion,” Tory said at a press conference prior to the vote. “But I’m not prepared to be that kind of mayor and when most people think about it, they know we need to build the transit and they know it isn’t free.”

“If anyone is opposed to road tolls, they have an obligation to tell us what they would do instead.”

There seemed to be a lot of differing opinions, but at the end of the day, the executive council saw the light and voted to send the toll proposal to city council for further consideration. The fees/cost of toll implementation will be decided at that point. Executive Committee also voted to ask the province for permission to impose a hotel and short-term accommodation rental tax and an alcohol tax. Council is still adamant not to increase property taxes by more than half a percent.

Tolling Toronto’s major roadways has a lot of benefits, and as was proven by the Mainstreet Research poll conducted last week, most of Toronto’s residents are comfortable paying a fee to use the DVP and Gardiner. The hope is that tolls will not only collect the much-needed revenue to build more transit, but it will also alleviate congestion and gridlock by encouraging car pooling and transit usage.

At the same time, the revenue tool discussion is always a hard one to have. An election is forthcoming, and no city councillor, not to mention mayoral candidate, wants to be the person to say “hey, we are raising taxes and we are making you pay to drive to work.” Toronto’s current mayor seems to have put the politics of re-election aside and was brave enough to push forward a proposal that may not be all that popular among his fellow councillors. And for that, Women’s Post commends him.

All I can say is that I hope the rest of council realizes that Toronto is in a pickle. The city needs money and it needs to build transit and infrastructure. The reality is that you can’t do one without the other.

by
Keep Reading
#TOpoli

New Mainstreet Research poll shows Toronto crazy for tolls

There has been a lot of criticism following Toronto Mayor John Tory’s new proposal to toll the Gardiner Expressway and the Don Valley Parkway. But, what do Torontonians really think? A recent poll published by the Transit Alliance, a non-political organization that works with people in the transit and infrastructure industry, shows that over 50 per cent of Toronto residents actually support the use of tolls.

The poll, which was conducted by Mainstreet Research on Nov. 25, surveyed residents from all 44 wards in Toronto to find out if they supported tolling major roadways to pay for infrastructure and transit. What they found was an overwhelming endorsement of the mayor’s proposal. Sixty-five per cent of Toronto respondents said that tolls were the preferred source of revenue compared to increasing property taxes or introducing a sales tax.

This statistic was further broken down into regions: 72 per cent in the downtown core, 64 per cent in North York, 62 per cent in Scarborough, and 57 per cent in Etobicoke.

When asked specifically about tolls, respondents across the board said they would be supportive of implementing them on the DVP and Gardiner.

The question was: “Proponents of road tolls for the Don Valley Parkway and the Gardiner Expressway say road tolls would force non-city of Toronto residents to pay their fare share; critics say road tolls are an unnecessary tax hike. Do you approve or disapprove of introducing tolls on the DVP and Gardiner Expressway to pay for transit and infrastructure?

Support for tolls was the highest among downtown residents, with 70 per cent of respondents approving — including 52 per cent strongly approving — of the revenue sources. Residents of Etobicoke and Scarborough were less supportive of tolling, at 61 per cent and 68 per cent support respectively — still relatively high within the margins.

Only a third of Toronto residents approved the use of property tax increases, and even less supported the use of a sales tax (22 per cent).

While there are a number of critics that believe tolling to be an unfair tax on those living within the 905 region, this poll shows that even those living in Etobicoke understand the need to create revenue for better transit and infrastructure. The city needs to grow, and if the choices are between an increase in taxes or a toll on drivers, Toronto has made it clear that tolls are preferable.

If there is this much support throughout all the wards within the city, hopefully the mayor’s proposal will soar through council and Toronto can finally start to accumulate the funds it needs to continue developing transit and infrastructure throughout the GTHA.

Mainstreet Research surveyed a random sample of 2,280 Toronto residents, calling a mixture of landlines and cell phones. The poll has a margin of error of +/- 2.05 per cent.

by
Keep Reading
#TOpoli

Mayor John Tory right on the money with revenue tools

Toronto Mayor John Tory announced Thursday that he would be proposing the use of tolls and a hotel tax to create extra revenue for transit and infrastructure projects in the city. Prior to that announcement, a report was released by the Munk School at the University of Toronto indicating the need for a multi-tax system to pay for services. The conclusions of the report back up Tory’s decision to actively search for more revenue tools to help pay for the much-needed transit system being built in the city.

The report was written by Harry Kitchen, a professor in the economics department at Trent, and Enid Slack, director of the Institute on Municipal Finance and Governance and a professor at the Munk School of Global Affairs. They argue that property taxes, user fees, and transfers from other levels of governments have remained unchanged as large cities continue to grow and expand. This is unsustainable and larger cities in Canada must adapt.

The authors’ argue that decisions on public spending need to be linked with revenue decisions. This is what the mayor was trying to say in his speech on Thursday — that Toronto can’t afford to keep building and providing better service unless there is a way to pay for this growth.

The report also makes mention of services that benefit people across municipal boundaries like roads. While the report suggests transfer of responsibility to the province, sometimes that isn’t possible. Tolls, for example, would be a good compromise, allowing people who often travel into the city on a daily basis to contribute in a way besides property taxes.

In terms of the property tax, something Mayor Tory refuses to increase by more than half a per cent, the authors’ say it’s a good way to raise revenue for infrastructure, but that a mix of taxes is recommended. Property tax is also more expensive to administer compared to income or sales tax. “The property tax is relatively inelastic (it does not grow automatically as the economy grows), highly visible, and politically contentious,” the report reads. “It may therefore be insufficient to fund the complex and increasing demands on local governments.”

“A mix of taxes would give cities more flexibility to respond to local conditions such as changes in the economy, evolving demographics and expenditure needs, changes in the political climate, and other factors.”

The report suggests charging user fees for services as often as possible, as under-pricing can result in over-consumption. Tolls were specifically mentioned as an example of a user fee that can be used on a major highway or arterial road running into a big city. While high-occupancy tolls, which charges vehicles for using a specific lane, can be effective on big highways, it’s much more efficient to toll the entire roadway.

Revenue collected from the tolls in place on the 407 in 2011 earned the provincial government an extra $675 million. The proposal set forth by Tory indicated an extra $200 million in revenues with a $2 toll charge on the Gardiner Expressway and the Don Valley Parkway. The other benefit is that it will reduce congestion and unlock gridlock while creating funds that can be dedicated for transit.

Other options presented in the report include a parking charge, an increase in personal income and sales tax, a fuel tax, hotel tax, and vehicle registration fee. The conclusion seems to be by increasing/implementing a number of these revenue tools, it won’t affect a singular demographic to harshly while still generating funding for a large Canadian city to grow.

It looks like our mayor was right on the money, so to speak.

by
Keep Reading
#TOpoli

Mayor John Tory proposes tolls for DVP and Gardiner

The city of Toronto has finally clued in — if you want change, you need to be willing to make the unpopular decision to pay for it. As the mayor said in a speech Thursday afternoon, “If we are to achieve those goals we have to acknowledge that things we need, from transit to affordable housing, are not free. Pretending otherwise is not responsible and it’s not fair to the people of Toronto.”

Mayor John Tory chose to announce a new proposal to find much-needed revenue to help pay for the new transit network being built in the city at a luncheon at the Toronto Region Board of Trade Thursday afternoon.

What was this exciting solution? It was tolls.

Tory is proposing a $2 single-use toll to use the Don Valley Parkway and the Gardiner Expressway. This will bring in an approximate $200 million of extra revenue that can be used specifically for infrastructure. This would be a tax on everyone, whether or not they live in the city or not. This will ensure that those who work in the city also contribute to its growth.

“People say that Toronto’s population is approximately 2.8 million. That’s true, at night, when the people who live here are home sleeping,” said Tory. “But by day, the number of people in this city goes up dramatically with all the people who come to work or to visit, all the while using the services paid for by Toronto taxpayers.”

The details of the proposal are still unknown. It will be presented to executive committee next week along with all the other options for revenue tools. The city has to find about $33 billion over the next 20 years to fund capital projects, despite provincial and federal aide.

Mayor Tory has said he will not be considering vehicle registration tax or a parking levy. Two other forms of revenue were proposed during the speech, including a half per cent levy on property taxes and a mandatory hotel tax at all Toronto hotels and short-term rentals like Airbnb.

During a press conference following the speech, the mayor said that doing nothing is not an option. The $2 cost, as well as the functionality of the tolls, will be up for discussion at city council in the upcoming months. Assuming city council sees the value of tolls, Tory hopes to see it implemented as of 2019.

by
Keep Reading
#TOpoli

City council approves transit network plan

As a reporter, I love covering City Hall. But, sometimes it can get frustrating — for example, when it takes nine hours of discussion before a decision can be made surrounding a transit plan that has been on the table for over a year.

City Council voted Tuesday to go forward with the “motherlode” Transit Network Plan and approve a deal made with the province that will see them contribute approximately $11 billion towards transit. This includes $3.7 billion for Regional Express Rail (RER) and $7.84 billion for Light Rail Transit (LRT).

The problem? The city was not prepared to carry their weight of SmartTrack. This agreement would see the city contribute $3 billion of their own funding towards the project (or $2 billion if the federal government pitches in). Toronto will also be responsible for day-to-day-operations and maintenance of the Finch West, Sheppard East, and Eglinton Crosstown LRTs.

Mayor John Tory had to remind council a number of times that the deal with the province really does benefit the city, saying that if the province had meant to pay for everything, they would have had a parade and used it as an election campaign issue.

“The number one thing they want me to do is ease the strangulation that has taken place in this city as a result of traffic congestion and the number one way you can do that is build public transportation,” Tory said to reporters half way through the meeting.

This transit network has been a continuous source of political capital for city councillors, which is why staff divided the funding discussion into two parts in hopes of making the decision easier. During this particular council meeting, councillors were simply voting to approve the negotiations between the province and the city, and committing the city to continue their work. Staff will then return with the exact costs and details of construction for each project.

The second discussion will be about revenue tools — how exactly will Toronto pay for transit? Will they have to raise property taxes? Will they have to find cuts somewhere in the budget? This discussion will happen in December or January and is sure to be just as lengthy, if not more so.

However, this did not stop a number of councillors from using this time to try and amend the motion to squeeze as much as possible out of the province. Staff warned that by delaying the provincial negotiations, it could result in the province completely reneging on the agreement. As City Manager David Wallace pointed out, Toronto needs to make an investment and they need to do it now.

There were a number of councillors who were concerned about making that investment, saying that approving a plan before knowing how the city was going to pay for it was irresponsible. While I can admire their tenacity and commitment to the budget, city staff, as well as the Toronto Transit Commission, have reached an agreement that appears to be quite fair. By continuing to delay the building and construction of necessary transit systems, council will ultimately ruin all the hard work city staff have put into building an integrated transit network to begin with.

The solution seems simple: instead of complaining, be creative and start to come up with ways of creating revenue without raising property taxes to the extreme. I’ve previously suggested the use of tolls, something I firmly believe would help raise the much-needed revenue for transit. Not only would it unlock gridlock on our congested roads, but the money could be earmarked for SmartTrack specifically!

Toronto NEEDS transit, and if at all possible, it would be great if part of it was finished in my lifetime. Let’s stop the bickering and start to think of real solutions to the city’s gridlock problems.

by
Keep Reading
#TOpoli

Why not use tolls and fees to fund green projects?

Over the last few months, the City of Toronto and the Ontario government have made some amazing announcement focused on green energy, infrastructure, and public transportation. The most recent announcement was made Tuesday: the Ontario government released $750 million in funding (in the form of a green bond) for environmentally friendly, low-carbon infrastructure projects, the majority of which would be dedicated to transit in the GTHA.

These investments are a good thing. A great thing, even. This city and this province must invest in infrastructure and transit. But, where is this money coming from?

A green bond is a great tool to raise capital for projects with environmental benefits, but eventually the bond holders need to be paid back. Investors provide funds for these projects and the government guarantees a return for each investor. When asked by Women’s Post if there was a plan to pay back these investors, this was the response given:

“Ontario’s Green Bonds rank equally with Ontario’s other bonds,” a spokesperson for the Ontario Minister of Finance said in a written statement. “Payments of principal and interest will be a charge on and payable out of the Consolidated Revenue Fund of Ontario and not tied to the revenues of any particular projects.”

Luckily, the maturity date for the green bond is in 2023, which means that the government has time to educate the public on the need to come up with the revenue for these investments. And it will be interesting to see what forms of repayment they create.

Tolling — while under both the provincial and municipal responsibility depending on the road — would be an ideal form of revenue. Ontario is starting a pilot project in the summer that will allow single-occupancy vehicles to use the High-Occupancy Vehicle lane meant for carpooling. Vehicle owners will be able to purchase a permit and pay a toll for its usage. This is the first time a responsible government has risked their positions to do the right thing.  Toronto is a long way off, with only a handful of councillors willing to stand up for the revenue tools Toronto needs to pay for the capital projects the city has committed to.

The money collected from these tolls can be used to fund the  the relief subway line which will provide an alternate east-west route to the Gardiner. Council has to make the bold move to call for other user fees – tolls, carbon tax, parking increase – so that property owners won’t carry the full burden of our capital deficit.

Both the city and the province are trying to find money in the budget — which amounts to shuffling through the same insufficient funds that caused our infrastructure deficit.   Toronto councillors will need to show the bravery their province counterparts have demonstrated in committing to high occupancy toll lanes.  The obvious solution is to use existing green projects such as tolling, congestion fees, or even a carbon-tax , to fund infrastructure investments.

The biggest problem facing all levels of government is that most Canadians want the infrastructure but they don’t want to pay for it.   The province is doing an amazing job ensuring that transit and green infrastructure is built, but Canadians have to start doing our part.

Let’s support the use of tolls, congestion fees, carbon taxes – whatever our council might bravely suggest — and start investing in Toronto’s long-term future.

by
Keep Reading