Overshadowed by the dramatic events of last Friday, when Rob Ford pulled out of the race for mayor and Doug Ford stepped in, was a telling exchange between the other main players: John Tory and Olivia Chow.
With Mr. Ford sidelined by illness, the two were debating one on one at an event organized by the Ontario Home Builders' Association. When talk moved to transit, Mr. Tory pounced. Could Ms. Chow confirm that she would pay for the downtown relief line, a future subway project, through $3-billion in property taxes, he demanded.
It is a bizarre line of attack, especially coming from Mr. Tory. Not very long ago, when he was head of the Greater Toronto CivicAction Alliance, he spoke about the need to consider new sources of money to pay for better public transit. In the text for a speech to the Empire Club in Toronto in April, 2013, he said politicians needed to stop playing games and find "the honesty and courage to tell people there is no free transit."
Now, apparently, he is against using even existing sources of revenue, such as the property tax, to pay for better transit. That is all that Ms. Chow is suggesting. She never said she planned to raise $3-billion in property taxes. She simply acknowledged, if a bit too reluctantly, that when it comes time to pay for the relief line, the money might have to come out of the city's main source of revenue, the property tax.
That is only stating the obvious. Toronto is paying for most of its share of the planned Scarborough subway extension through a property tax increase. Mr. Tory supports that project, so how can he attack Ms. Chow for proposing to use the same method on a future subway?
Mr. Tory got the $3-billion figure by taking the $8.3-billion estimate for the whole, fully extended relief line – not the initial phase Ms. Chow is talking about – and dividing by three to reflect the one-third share Toronto can be expected to pay for big transit projects (with the rest coming from the provincial and federal governments).
Now, his arithmetic is a bit off. One-third of $8.3-billion is $2.76-billion. What's a couple of hundred million between friends? It did not stop him from throwing the figure in Ms. Chow's face, not only in the debate but in a news release sent out by his campaign war room warning that "NDP candidate Olivia Chow" would raise property taxes by more than $3-billion to pay for "her" downtown relief line.
Here is the problem. As Ms. Chow was quick to point out, Mr. Tory himself says he wants the relief line built, if only after his own SmartTrack surface subway project is finished. How would he pay for it?
She asked him once. She asked him again. She reminded him that "you can't get anything unless you pay for it."
Finally, looking a little like a deer in the headlights, Mr. Tory gave this reply: "I would like to consider using some of the same mechanism that I've talked about using with respect to the SmartTrack plan. … I think there are ways in which you can finance the downtown relief line, but I have focused on financing the one that is going to be built first, which is SmartTrack … with the city's third coming from tax-increment financing. I think there are number of mechanisms you could use to finance the downtown relief line."
Tax-increment financing is the method he would use to raise the city's one-third share of his $8-billion SmartTrack project. It relies on the higher tax take, or tax increment, that should in theory come from the development that often grows up around transit lines.
It is untried in Canada on such a scale, and none of the recent studies on transit financing has recommended making it a leading source of funds. Now he wants to consider using it not just for SmartTrack, but for the relief line, too?
This is really quite incredible. The man who urged politicians to be straightforward about how they would pay for transit now attacks a rival candidate for saying she might have to use taxes. The man who said "there is no free transit" now appears to be saying he could build not one but two huge transit projects – worth $16-billion in all – at no cost to local taxpayers.