Toronto

Executive committee approves transit-funding deal between city, province

John Tory's executive committee passed the multi-billion-dollar transit-funding deal between the city and province that includes a proposed property-tax hike as a potential revenue stream, despite the mayor's campaign pledge that he would not resort to such a measure.

Report, issued Monday, proposes numerous revenue tools, including a property tax hike

Tory had called an emergency meeting of his executive committee a day after the city issued a report that proposed terms for the two levels of government to share the $7 billion cost for several transit projects in Toronto. (CBC)

John Tory's executive committee passed the multi-billion-dollar transit-funding deal between the city and province that includes a proposed property-tax hike as a potential revenue stream, despite the mayor's campaign pledge that he would not resort to such a measure.

"I'm very pleased with the vote of the executive committee — unanimous — in saying we have to move forward," Tory said, adding he believes the vote is a "good indication" that the deal will be approved by city council. 

Tory had called an emergency meeting of his executive committee a day after the city issued a report that proposed terms for the two levels of government to share the $7 billion cost for several transit projects in Toronto.

The Transit Network Plan Update and Financial Strategy report identified a property-tax hike of at least 2.1 per cent to cover the city's share, despite Tory's campaign pledge that he would not raise property taxes to pay for his SmartTrack plan.

"There's certainly going to be tax increases or revenue changes that are going to be necessary," said Tory following the vote. "I've made no secret of that."

The report outlined other options for the city to shoulder its share, including tax increment financing (TIF), development charges, tax-supported debt financing and other measures.

'It's even worse than I thought'

On Tuesday morning, Tory met with Ontario Premier Kathleen Wynne. At a joint news conference after their meeting, Tory reiterated that he promised during his mayoral campaign not to raise property taxes for SmartTrack.

"I would point out what I said is that we would not raise property taxes to build SmartTrack," Tory said. "People conveniently left out the fact that [the report] made reference to the possibility that you could raise property taxes, but other revenue streams are needed or at least could be developed to pay our share."

City council will debate those potential revenue streams later this month, Tory said.

According to the report, the city will pay $2 billion for six new SmartTrack stations and the Eglinton West LRT.

The Ontario government, under the agreement, will pay $3.7 billion for infrastructure that will support SmartTrack. The infrastructure is called GO Regional Express Rail (GO RER). That amount includes rail and track infrastructure, grade separations, electrification and fleet upgrades.

TTC chair and Coun. Josh Colle said he hopes a property tax hike isn't the primary source of revenue for SmartTrack and other transit projects. (CBC)

The report also includes $1.2 billion in assumed contributions by the federal government, and $470 million in assumed contributions from Mississauga and the Greater Toronto Airports Authority.

The province is on the hook for infrastructure to support SmartTrack, while the city will handle operating and maintenance costs.

Prior to Tuesday's meeting, some councillors were critical of the project and the suggested funding models, including the division of responsibility between the city and the province.

Ward 14 Coun. Gord Perks said Tuesday that he was even less in favour of the deal than he was on Monday.

"On closer examination I can only say that it's even worse than I thought yesterday," Perks told reporters at city hall. "There are an awful lot of financial assumptions here that are very, very troubling."

Perks challenged the mayor to tell councillors and residents how he intends to pay for the plan.

Mayor Tory has said, 'Maybe the hotel tax.' I'll tell you right now, that's nowhere near enough money for what's on the table in front of us," Perks said. "I challenge Mayor Tory: 'Live up to your own standards, tell us how you want to pay for this.'"

Coun. Janet Davis said the city is being asked to pay far more than previously thought for what amounts to a regional express commuter line at the expense of other priorities, such as the downtown relief line.

"My question has to do with whether this is the project that we should be putting our priority towards in terms of commitment of funding," Davis said.

Coun. Janet Davis says "I don't think it's on" to a provincial deadline of Nov. 30 to commit to the transit-funding deal. (CBC)

She said the Nov. 30 deadline from the province for the city to fully commit to the deal is too soon.

"This is unprecedented to walk on a report with 24 hours' notice and to expect the City of Toronto to make some commitments that are worth billions of dollars to the people of Toronto in such a short timeline," she said. "I don't think it's on."

'We have to pay for it some way'

On Tuesday morning,  TTC chair Josh Colle, the councillor for Ward 15, responded to the criticism by noting that currently, some GO infrastructure that runs through the city doesn't serve the city's residents. 

"For me at the end of the day we have GO infrastructure in this city that runs through neighbourhoods that doesn't service Torontonians," Colle told CBC News. "Call it whatever you want. Call it SmartTrack, call it Regional Express Rail, call it some hybrid of both, at the end of the day it would be a complete missed opportunity if we didn't add local stations and local service to those GO tracks."

With residents calling for improved transit to alleviate gridlock, Colle said, the time has come to have a conversation about how to pay for it.

"I think what's happening in the city for whatever reason is that people want transit and we know we all need it and yet politicians and in all fairness residents don't seem to want to pay for transit," Colle said. "And so my hope is that this conversation and this report is going to bring that connection closer together to recognize if we need the transit that people have desperately been calling for, then we have to pay for it someway."

He said he hopes that a property-tax hike is "not the source" of revenue.

"But we have to recognize the money has to come from somewhere," he said, noting that parking fees, tolls, sin taxes and hotel taxes are all possibilities.

On Tuesday morning, Tory said while discussions about revenue are still ahead, he is pleased that the SmartTrack plan is moving forward.

"I'm focused on getting the project done and to have people riding on trains to relieve the unbearable nightmare of getting to and from work or school."

With files from Justin Li, Chris Glover

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