One evening, in a windowless ballroom at the Intercontinental Toronto hotel, Premier Dalton McGuinty promised to give the city what it had long been seeking: Permission to grow up.
It was the start of the Mayors’ Summit, a gathering of the heads of the country’s largest cities in September 2004, and McGuinty, a year into his inaugural term, was the keynote speaker.
After a fierce campaign by civic leaders (and this newspaper) to loosen the paternalistic grip of the provinces and empower cities to greatness, McGuinty chose this moment to end months of speculation. The new premier invoked some colourful imagery — and boldly took up Toronto’s cause.
“Toronto is the engine of economic growth in Ontario and much of Canada,” he said. “It’s a miracle it has delivered prosperity for so long and to so many, despite living in a legislative and fiscal straitjacket that would baffle Houdini.”
McGuinty vowed to modernize the City of Toronto Act, the legislation that lays out the city’s powers, and make Toronto more fiscally sustainable, autonomous and accountable.
The largest city in the country needed its own rules — for everything from taxation and governance to planning and development — and he pledged to write them.
The room erupted. Councillor Shelley Carroll, then a member of the budget committee, said she clapped so loudly she was chided by a tablemate “for being too enthusiastic in my applause.”
“I leapt to my feet,” she recalled. “It was a big moment.”
At the time, newly minted Mayor David Miller, who had campaigned on the promise of strengthening the city’s might, lauded McGuinty’s announcement as “a huge deal” — and in many ways it was. After the sting of amalgamation and the slashing and burning of the Mike Harris years, the City of Toronto Act, signed into law in 2006, was the product of rare collaboration in the name of city-building.
But how much have we done with the powers we fought so hard to get? Or perhaps a more pertinent question, as the municipal election nears and the search is on for big ideas to remake the GTA: What could we achieve with the powers in the City of Toronto Act that we have yet to tap?
To many Toronto residents, the most tangible impact of the City of Toronto Act is the land-transfer tax, which was implemented in 2008 and generated $350 million last year. The $60 vehicle registration tax, also made possible by the legislation, brought in $64 million a year before Mayor Rob Ford killed it in 2010.
The legislation, which came on the heels of the MFP computer leasing scandal, also mandated new accountability provisions (which were put in place), as well as specific provisions to exert more control over planning and land use (which were not).
Yet according to the architects of the legislation, its true, and largely untapped, potential resides not in specific line items, but in the broad authority it gives the city to get creative — and think big.
“The assembly recognizes that the city is a government that is capable of exercising its powers in a responsible and accountable fashion,” the legislation reads. “The city may provide any service or thing that the city considers necessary or desirable for the public.”
This open-ended language was intended to put the city squarely in the driver’s seat.
“When you look at that Act, the potential for things you want to do — it’s almost unlimited,” said former Star publisher John Honderich, who coined the term “new deal for cities” in a 2002 editorial, and launched a crusade for structural and fiscal reform for hamstrung urban centres.
Honderich, who is now chair of Torstar’s board of directors, left the paper in 2004 to see through his vision for Toronto as Miller’s special ambassador on the cities agenda. Reflecting on the use of the powers he helped win for the city, he said, “In some ways, it is a tragedy … The tool is there, but we have really not used it much.”
He is not alone in his frustration.
McGuinty’s former policy adviser Richard Joy recalls hammering out the new legislation as “a golden moment for the city.”
“There were moments when were having a beer during the more casual side of the process, and we were dreaming about just incredible things that could potentially come from this,” said Joy, who now works for the Toronto Region Board of Trade. “To be honest with you, here we are, how many years later, and not too many things have come forward.”
When new powers were being contemplated for Toronto, the city still had to get approval from Queen’s Park for everything from changing speed limits to extending bar hours, despite being home to a diverse population of millions.
So, instead of being prescriptive, and spelling out everything the city could and could not do, those at the table wanted the legislation to be permissive.
“We drew the conclusion that the city, rather than being a creature of the province, certainly had a civic culture and a political culture in its own right,” said Gerald Butts, who was McGuinty’s principal secretary and is now chief adviser to federal Liberal Leader Justin Trudeau. “We would go from this sort of ‘Father knows best’ approach … to allowing the city to chart its own destiny.”
But council has been slow to realize the extent of the powers the province has delegated to the city — and embrace what mayoral candidate David Soknacki describes as “a whole different change in perspective.”
“Mayor Miller kept the portfolio to himself, because he’s the architect and proud father,” said Soknacki, a former city councillor who was Miller’s budget chief from 2003 to 2006. “In this administration, there certainly hasn’t been an exploration of what it can do.”
But leaving aside Ford and his attacks on spending and taxes, some say the shallow impact of the City of Toronto Act has been at least partly a result of what the province held back.
Among the revenue-generating tools the city asked for but did not receive is the ability to impose income tax and sales tax — the latter of which Carroll believes is “the one big, glaring omission from the City of Toronto Act.”
“Cities hit a wall where you should not be relying on property tax for half of your operating budget,” she said. “You should have a more diversified stream.”
Instead, the Act gave the city a package of smaller fiscal tools, in addition to the land-transfer tax and vehicle registration tax, as well as so-called “sin” taxes on alcohol and tobacco, neither of which have been introduced.
The reason: the relatively high cost of collection. Estimates indicated that each tax would have cost the city $10 million a year, while generating about $12 million, according to Carroll.
She considers the legislation “a stepping stone.”
“It made it possible for us to expedite certain things, and to solve half of our financial equation,” she said. “It hasn’t solved it all.”
For the moment, the province is not considering any further changes to the City of Toronto Act, according to the Ministry of Municipal Affairs and Housing.
The Act “sets out a broad, permissive legislative framework for the city,” spokesman Mike Maka said in an email. “The city has broad powers to pass by-laws regarding matters that range from public safety to the city’s economic, social and environmental well being.”
Toronto municipal lawyer and former city councillor Ron Kanter concurs. “I don’t think (the obstacle is) the restriction on powers,” he said. “I think it’s more the unwillingness or lack of imagination or vision of people who say, ‘I’ve got a really good idea, and let’s go ahead with the idea.’”
But there are signs that contentment with the status quo is starting to erode. Frustrated by the stranglehold the Ontario Municipal Board has over development, downtown Councillor Adam Vaughan is spearheading a campaign to enact a section of the City of Toronto Act that would allow Toronto to set up an appeals board to preside over decisions related to minor variances, such as additions to homes.
“It gives us the ability to appoint the panelists, so we can have Torontonians decide the future of Toronto,” Vaughan said. “It also means that the decisions we make, the politicians that you elect in your neighbourhood can be held accountable.”
Mayoral hopeful Karen Stintz said she has “deep concerns about the potential abuse of the taxing powers” the legislation gives the city “under a future NDP mayor or council.”
But when it comes to supporting communities, parks, transit, safety and city services, the councillor and former TTC chair said she would use the act to implement her platform.
“The City of Toronto Act gives Toronto powers of a government similar to a province,” she said. “We are able to achieve an innovative and forward-looking agenda for the city.”
Neither Ford nor former provincial Progressive Conservative leader John Tory, who joined the mayoral race last week, responded to a request for comment on how they would use the Act to make Toronto a better place.
While Soknacki may be considered the dark-horse candidate, his list of proposals was the most inventive. Among his suggestions: Allow individual communities to change their rates of taxation to reflect desired services; redraw ward boundary lines to reflect population shifts; and fill the ranks of the powerful executive committee with councillors that would be elected at large from community council districts.
The most compelling aspect of the legislation, he said, is how it can empower a neighbourhood — whether it wants to dedicate a road for street hockey, or invest in geothermal heating.
“Stop thinking line-items. Start thinking as a city,” he said. “We’re not using nearly the opportunity that’s at hand.”