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Under a proposed bylaw, Toronto would charge a per-sign levy for billboards such as these at Yonge-Dundas Square. (Fernando Morales/The Globe and Mail)
Under a proposed bylaw, Toronto would charge a per-sign levy for billboards such as these at Yonge-Dundas Square. (Fernando Morales/The Globe and Mail)

Taxation

Ad men become mad men Add to ...

From highways to outdoor walls to the orgy of flashing neon that is Yonge-Dundas Square, Toronto's billboards are inescapable attention-grabbers.

If a city proposal to tax billboards is approved, they'll be cash-grabbers as well.

City council is set to vote today and tomorrow on a new levy that would force advertisers to pay a set price per sign, varying depending on size, type and location.

The tax would bring in about $11-million a year, $1.8-million of which would go to enforcing a new sign bylaw.

Outdoor advertisers are vehemently opposed to the idea, saying the tax, combined with a proposal to tighten lax controls on sign placement and display, would devastate the industry.

"If it passes, then I guess we'll have to review with our legal counsel what our options are going forward," said Rosanne Caron, president of the Out-of-Home Marketing Association of Canada.

"The outdoor advertising industry contributes significantly to the economic growth in Toronto ... You're crippling an industry. You're going to decimate them."

City staff say their calculations show the industry can absorb the tax.

Right now, the proposal focuses only on the tax and tighter controls, not on how the proceeds might be spent.

But if Devon Ostrom and a band of arts and culture advocates get their way, the proceeds will be earmarked for beautifying public space. City staff support the idea in principle; but council won't vote on where to direct the money until next spring.

Mr. Ostrom's group, Beautiful City, and several other community groups have been lobbying the city for a billboard tax since 2002.

Mr. Ostrom envisions hundreds of thousands of dollars annually going to promoting "art in the public sphere," including to festivals, murals and green space.

He stops short of calling Toronto the Good utilitarian, but says "there's always been kind of a resistance to making this city look better and funding the arts."

In dire economic straits, especially, arts and culture funding tends to be more vulnerable to budgetary trimming. But according to a study by consulting firm McKinsie and Company, every dollar invested in arts and culture generates several more in economic activity.

The new tax would put a flat rate on five different categories of sign, charging more for bigger or flashier billboards.

It's paired with a new bylaw governing which outdoor signs can go where and tightening formerly lax rules after city surveys found as many as half the signs in some wards didn't comply with existing rules.

Public space and public art are increasingly a priority for a marketing-saturated population, argues Councillor Joe Mihevc (Ward 21, St. Paul's). "People are saying in an ever-present advertising world that they want some controls on it, as well."

Advertising companies think otherwise. Representatives of the outdoor advertising industry have spent the past several months lobbying councillors to oppose the tax and bylaw. Signs recently sprung up around downtown asks passersby, "Why would the city tax an industry more than it earns?"

It's not that the industry opposes the bylaw itself - or even a new tax, Ms. Caron says. But as it stands, she argues, the bylaw is too restrictive and the tax too steep. According to an economic assessment OMAC commissioned earlier this year, the tax would eat up the industry's entire annual profits, and then some.

"We're willing to accept a tax if it's to cover the administration and enforcement costs of the new bylaw. ... But if the city thinks it's important to fund public art, then they should put it in their budget. Since when is it appropriate to single out one industry to fund something?"

The industry has an ally in councillor Karen Stintz, who thinks the tax as proposed is unreasonably high: She would rather see something that exacts enough money to cover bylaw enforcement, and no more.

"There's not a real clear connection why the single industry should be funding public space. Public space initiatives should be funded out of the tax base," she said.

Ms. Caron hopes the city will put off deciding, and then spend at least a month consulting with the industry to try to come to a compromise.

Councillor Adrian Heaps thinks that's a reasonable proposition. He's putting forward an addendum to the motion to have staff review the industry's revenue figures to find out what dollar amount would be reasonable.

"If we're going to collect new taxes, we'd better not kill the industry that's going to provide us with the source of revenue."

But Mr. Mihevc argues the industry just needs to "learn to share."

"[From these changes]you'll have neater streets, tidier streets, more beautiful streets and more art and culture in our city. And I think that's all good."

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