No 'view tax' needed to pay for Rail Deck Park, Chief Planner Jennifer Keesmaat says

Toronto's chief planner Jennifer Keesmaat says she's optimistic that sources of funding for the proposed Rail Deck Park can be found and the ambitious project can get built without the need for a "view tax."

Chief planner Jennifer Keesmaat says the city can pay for Rail Deck Park without a view tax

City of Toronto Chief Planner Jennifer Keesmaat, seen here speaking with CBC Toronto's Dwight Drummond, says she's confident the city can pay for Rail Deck Park without a so-called "view tax." (CBC)

Toronto's chief planner Jennifer Keesmaat says she's optimistic that sources of funding for the proposed Rail Deck Park can be found and the ambitious project can get built without the need for a "view tax."

Some people are advocating a levy on homeowners who live near amenities such as parks, museums or concert halls, because the view enhances the value of their properties. The revenue would contribute to the construction and upkeep of landmarks like Rail Deck Park.

Keesmaat said city staff are crunching the numbers on the proposed 8.4-hectare green space that would be built over the waterfront rail corridor from Bathurst Street to Blue Jays Way. She is hopeful existing revenue tools will cover the price tag — an estimated $1.05 billion or more.

She points to Section 37 of the Planning Act, under which the city can require developers to help pay for neighbourhood amenities in exchange for the approval of their projects. There are also development charges that can help defray the cost, Keesmaat says.

How will Toronto pay for Rail Deck Park?

6 years ago
Duration 2:45
City planner Jennifer Keesmaat discusses various revenue tools that could fund Rail Deck Park.

"When we collect that money, that money is dedicated to parkland. And we do have several hundred million already collected precisely for this purpose."

Gail Dexter Lord, co-president of Lord Cultural Resources, agrees the capital costs are taken care of by Section 37 and other tools, but she says people who live close to parks benefit, so they should help pay for it.

"The capital costs are just one stage. The next stage is the day-to-day operation of that park. In seven years, that operational cost can equal the capital cost on average," said Lord. "Who better to help pay but the immediate neighbours?"

Lord's company works with park conservancies in the United States and Canada, which are philanthropic groups that raise money and work in partnership with cities to maintain and run public parks.

The city's Rail Deck Park could cost more than $1-billion, and that doesn't take into account the "air rights" that railway companies claim they have over the space above the tracks. (Jennifer Keesmaat/Twitter)

A view tax is "a good-neighbour policy" for those who own homes near parks and other amenities, Lord says.

"The more that park is looked after by the conservancy, the more their property value will increase when they go to sell, yet they are not contributing anything," said Lord.

And one consulting firm estimates that property values around the Rail Deck Park could rise by $908-million should it ever be built.

"Charge the people who stand to benefit the most — nearby property owners," said Vijay Gill, the vice president for North America with CPCS, an infrastructure development consultancy company.

"Doesn't it stand to reason that those property owners should be willing to pay for a substantial portion of the park?"

Mitchell Silver, the parks commissioner for New York City, says the funding scheme has been used to build urban parks in U.S. cities. 

"There are some states that allow what's called Special Assessment Districts, he said. They establish a district that will benefit close to the improvement being built. If the taxpayers are putting in, let's say, a billion dollars, those property owners get a windfall from the taxpayers' investment," Silver said. 

Gail Dexter Lord, co-president of Lord Cultural Resources, says a so-called view tax would help with the upkeep of Rail Deck Park. (CBC)

He said property owners in the Special Assessment District pay a fee to offset the cost of the building that infrastructure.

"It's also called 'value capture' and I don't know if it's legal or allowed in Canada," Silver added.

But while Keesmaat agrees Rail Deck Park would increase property values for those who own condos around it, she's hesitant to use a "view tax' or Special Assessment District to help pay for it.

"People who already live around this infrastructure are going to benefit because there will be significant uptick in value, but prices will go up and up and up," said Keesmaat. "So do you add an additional fee on top that makes it even more expensive to live in the downtown core?"​

Keesmaat does agree, though, that philanthropy might play a role.

Mitchell Silver, parks commissioner for New York City, says a view taxes are a common practice in the United States.

In New York City, conservancies play a role in how parks are operated and maintained. These not-for-profit agencies raise funds and administer programming in city-owned parks.

And it's the model for the new Bentway Park that will run beneath the Gardiner Expressway from the foot of Spadina Avenue past Garrison Common and Fort York to Strachan Avenue. 

While Keesmaat said she's encouraged that there is widespread support for the Rail Deck project.

"Rail Deck Park is the pinnacle, if you will, the central grand gesture," she said. "The opportunity really of a generation to create the last significant contiguous park space in the downtown."