Raise the Hammer
Why do North Americans hate their cities? That's the question posed, and at least partly answered, by the Star's Business columnist David Olive in his column this weekend.
City hating "is especially pronounced in Canada," he notes, "where the urban centres are powerless creatures of the provinces, with no constitutional standing and very limited spending powers."
"Municipalities are routinely depicted as feckless authors of their own misfortune," he continues, "even after, in Toronto's case, accounting firm KPMG concluded that the city is an able steward of its finances."
It's hard to refute Olive's observations. The recent report by the Federation of Canadian Municipalities, which totted up the bill for our cities failing infrastructure and reached a figure of $123 billion, has been widely ignored by our federal reps.
"I call upon the cities to go and sit down with the provinces," declared Lawrence Cannon, Prime Minister Stephen Harper's minister of transport and infrastructure.
"We're not in the pothole business," said Finance Minister Jim Flaherty.
How did we come to this? Well, it may be because politicians fear the intellectual capacity created by cities, he suggests. He quotes Creative Class author Richard Florida: "Many political leaders just don't like cities. They often think they can mobilize rural and suburban voters by running against (them)."
Olive traces the historical evolution of large population centres, noting:
Suspicion of cities is as old as the Scriptures, where the Christian regard of urban life begins in Genesis with God's wrath in destroying Babylon, Sodom and Gomorrah.
As for how we stack up around the globe, well, our attitude is telling. Other cities regard cities as "national treasures" and federal governments support city projects directly.
He notes the "stunning makeover" of Charles de Gaulle Airport, the development of London, Boston's Big Dig, and the Guggenheim Bilbao Museum, all funded by federal governments.
Olive is a first rate business columnist. He is also a fierce city advocate. He, like Richard Florida and most progressive politicians in our midst, recognizes the uniqueness and importance of the urban landscape. Again, quoting Florida:
He also quotes Thomas courchene, director of the Institute for Intergovernmental Relations at Queen's University, in a report he wrote last summer for the Institute for Research on Public Policy, called Global Futures for Canada's Global Cities [PDF].When large numbers of entrepreneurs, financiers, engineers, designers and other smart, creative people are constantly bumping into one another, business ideas are more quickly formed, sharpened, executed, and - if successful - expanded.
Courchene describes a “virtuous circle” by which global city regions can take “actions that make them attractive to human capital, which, in turn, allows them to become magnets for attracting knowledge-based industries.
“Evidence suggests that privileging Canada’s `hub cities’ will propel them and their hinterlands forward economically.”
Yet Canadian cities are starved of the cash to fund such a renaissance.
“The international evidence on our global city regions’ fiscal weakness is striking,” Courchene warns.
As for what to do about it, Olive is clear: "It's time Canada's communities were funded directly by Ottawa," he suggests, noting that we are projecting a $26 billion surplus over the next six years.
He recommends "withhold[ing] political support" from leaders who continue to ignore the role of cities in creating a prosperous future.
Related: Fix the Municipal Funding Formula, Raise the Hammer.
By jason (registered) | Posted November 26, 2007 at 15:30:23
great article, although I don't think the writer is getting point of those Biblical cities being destroyed. God doesn't hate cities. lol.
They had become corrupt places full of wickedness and sin. It is easy to find just as many instances in the Bible where God urges his people to rebuild city walls and to be successful, while living in harmony with each other. In fact, in one passage God urges his followers to be like "a city set on a hill" for everyone to see and marvel at.
However, considering the constant message of the Bible to love each other, and the constant warnings about the love of money, I'm guessing God isn't a really big fan of our modern-day cities and lifestyle. We generally can't stand each other, only nod while pulling into our driveways and seem to be living for nothing BUT the love of money and material things. God knows what's good for the soul, and this lifestyle ain't.
By arienc (registered) | Posted November 26, 2007 at 20:19:06
While I normally disagree completely with Mr. Flaherty, I do believe that he has a point when it comes to funding of infrastructure.
Federal income tax was never intended to pay for infrastructure which widely varies by community and by province. Why should someone in the NWT who doesn't even have sewage, pay part of the tab for a Hamilton arts centre?
The problem is municipalities have historically appealed to immediate wants, and built new arenas, freeways and opera houses, instead of taking care of proper maintenance and repairing existing infrastructure simply because they could get elected by doing so. Therefore, they shifted around the money by starving their operating budgets to meet them.
What should have happened is when these facilities were built, existing residents who stood to gain from the new services, as well as prospective new residents should have paid the full cost, including maintenance up to perpetuity. If you can't afford to maintain it and repair it when it needs repairing, then you can't afford to build it...it's that simple.
Real estate is only useful as real estate because of the infrastructure that allows it to function. Why then is the cost of that infrastructure, plus the costs of keeping it maintained and in good working order (to perpetuity), not included in the cost of land. This could be accomplished quite easily at the time the land is developed through development charges. Over time as the land gains value (access to quality infrastructure contributes to this), the buyer is paid back the extra cost. Right now, developers are getting a free ride on the backs of municipal taxpayers. Municipal taxes should be used to operate the city, not to build it.
Of course most municipal politicians and those in the development industry would balk at the idea of charging developers more to develop a piece of land into housing or retail stores. However, it is unfair that the full value of 'location, location, location' accrues to them, and not the municipality that paid for the assets that make the location valuable. Developers have a right to make money, but should make money on their own merit, not on the public who subsidizes their profits through infrastructure.
The additional benefit of making development pay for the infrastructure, is that developers will then be more likely to build structures which use the infrastructure most efficiently. We'd get a whole lot less big-box retail and maybe more sensible mixed use as a result.
By arienc (registered) | Posted November 26, 2007 at 20:25:46
An example of what I'm talking about...all those new homes Losani is putting up on the mountain and in Binbrook area.
Those homes probably went up in value about 10K because of the new expressway.
Yet, the developers were likely not charged extra to develop the land in order to pay for the cost of developing the expressway. The result is the whole city must pay for the highway, and the developer scores a massive profit out of the deal.
Had the developer paid an extra $5K or more per lot, the city would not be faced with such a crushing deficit in paying for 7 kilometres of roadway.
By highwater (registered) | Posted November 26, 2007 at 20:32:29
Believe it or not, that's how it used to be. When Westdale (one of the first planned communities in Canada) was first developed, it was the developer who paid for the McKittrick bridge to link Westdale with downtown, without which Westdale would not have bee profitable. Those were the days. Don't know when or why it changed.
By Matt A (registered) | Posted November 26, 2007 at 20:32:45
It's not all a funding issue. Many of the cities we have are ones filled with spaces and places that no one cares about (and no one should). What redeeming character do large roadways, parking lots and same ol' same ol' stores carry??
This... and our cities need to work with neighbouring municipalites. If one jurisdiction manages to be bold and pass useful legislation to protect itself, what's to stop a neighbouring municipality from doing the opposite?? Sadly, I've seen this happen too often. Not only do we need greater funding for our cities, but much greater cooperation amongst them!
By jason (registered) | Posted November 26, 2007 at 20:53:05
highwater...I always use Westdale as an example of a proper 'free market' economy that people like to yap about.
IF we still had a free market, developers would be building neighbourhoods like Westdale.
The only way they can build stuff like we see in Binbrook is because they're being royally subsidized by us.
We haven't had a free market in decades.
By adrian (registered) | Posted November 27, 2007 at 09:28:37
arienc says,
Why should anyone pay for anything that doesn't directly benefit them? The answer of course is that we all live in the same country. What's good for the goose is good for the gander.
Anyway, there are other ways of fixing this issue that don't involve federal income tax. A proportion of the GST as David Miller has proposed would also work just fine. Or give cities wider powers of taxation. Why not have a municipal income tax, or a municipal sales tax?
Those additional taxes could be offset by decreases in the federal taxes. Why should my tax dollars be going to a federal government awash in surplus cash, so they can be spent sending troops to a foreign war or evading action on climate change, while my city's infrastructure is crumbling?
Why should my safety be put at risk while there is more than enough money in this country to make Hamilton and other cities outstanding places to live and work?
By arienc (registered) | Posted November 27, 2007 at 19:52:06
Adrian...thanks for your post...we both know the federal government is doing a very poor job at addressing the priorities of Canadians when it comes to foreign policy and climate change.
But putting another set of priorities on the federal level creates a moral hazard where municipalities can continue to run things in the same old way -- like delinquent teenagers feeding the profits from public assets to suburban big-box developers, knowing that "daddy government" will always bail them out.
In the end, we still pay. The only difference is the bag-holder is spread out over more citizens. It doesn't address the core issue of city-building processes that are unsustainable, which led us to underinvest in infrastructure in the first place.
I still believe that communities should bear the full responsibility for their funding decisions. If you want to build something in your community and you don't have the money, go to your citizens and raise taxes.
Cities will need to consider other sources of income than property taxes - the purpose of those is to pay for the operating of the property - things like garbage collection, snow clearing, police & fire dept's.
I propose development charges, as that best addresses the issue of how our current practices subsidize "bidness". I don't like income tax - I prefer to tax usage and consumption, in order to reward those who choose to live more modestly and encourage citizens to invest to build a future rather than spend today.
The public assets that surround and support a given piece of land should be embedded in the value of that land, from day 1 when the development permit is issued.
By CitiJoe (anonymous) | Posted November 29, 2007 at 01:36:45
A friend moved from Cabbagetown in Toronto to the real inner city. a block from Young St. & Shuter.
Now she is afraid to go outside. There have been 2 murders within a block of her building in 3 months. When she goes outside she is beset by panhandlers, & people who are quite obviously sick from drug use skulk around. People raid the trash bins at night. (& this is a building for those of limited income so there are no 'jewels' in that trash.)
Both Cabbagetown & Young & Shuter would be defined as inner city, but there is a world of difference between the 2 areas. One is a neighbourhood, & the other is a 'nice place to visit, but you wouldn't want to live there'.
This is one problem that I see with the maximum urban density = high rises only theory. It looks fine in pure statistics, but it doesn't make for a pleasant environment, or create 'neighbourhoods'. It creates isolation, disconnection, & to some degree, fear.
Little by little older neighbourhoods in larger cities are destroyed for high rise canyons & the most bang for the buck for the developers. Water fronts get built up for 'the view'. (In spite of the fact that these condos & high rises are an eyesore to people living near the water front or visiting the area.) Recently visiting Harbourfront for a concert made me claustrophobic.
There is no real plan for urban development in most cities. Plans can go out the window with each local & provincial election. New plans may not connect with what already exists, but mostly there is no actual plan at all. Things just happen, & money/profit is generally the only thing that makes these things happen.
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