Explaining the City of Toronto Act
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Explaining the City of Toronto Act

It's the legislation that outlines the City's governance and powers, and it's up for negotiation.

David Miller called it “a huge deal,” and Karen Stintz warned it would give Toronto “powers of government similar to a province.”

The year was 2006, and Canada’s largest urban centre mostly welcomed a landmark political reform, as the City of Toronto Act transformed the scope of municipal powers.

If you’ve barely heard of this important document and what it means to the City, then you’re not alone. But now, Council is going through a process that could alter the document known as CoTA, and further change the City’s powers.

Nine years later, little evidence remains of an act that—though still in effect—has failed to meaningfully alter the scope and structure of Toronto’s municipal government.

Yet, with the City of Toronto Act now subject to a five-year review, an important opportunity to reflect on—and amend—one of the city’s core legal documents now presents itself.

Like the earlier Provincial Acts, which outlined the scope of municipal powers and governance, CoTA provides the legislative structure on which council’s authority rests. What sets the 2006 Act apart from its predecessors, however, is the significantly expanded range of powers the City lobbied for and was granted for the first time.

In CoTA’s wake, Toronto became free to exercise new taxation powers, which would theoretically ease the fiscal strain on a municipality that relied on property taxes—among the only taxes the City controlled—for almost half of its budget. What’s more, Toronto could now create its own regulations to oversee issues ranging from accountability to development and urban land usage.

Under David Miller’s leadership, the first few years following CoTA saw new taxes enacted, providing the City with a vital revenue boost. New land transfer and vehicle registration taxes brought over $400 million in annual revenue, and expanded the City’s ability to deliver municipal services and undertake ambitious new projects.

Despite this, the new taxation proved to be short-lived. In 2010, Rob Ford swept into office, and promised changes from the Miller era. Upon taking office, a council presided over by Ford promptly cancelled the vehicle registration tax and the mayor single-handedly dismantled much of Transit City. Though the land transfer tax remained, the prospect of using CoTA’s new powers to respond to city needs disappeared from the political radar. The right-wing furor surrounding the vehicle and land-transfer made the further implementation of CoTA taxation a political non-starter, even though the powers have remained within legal reach.

On the regulatory side, CoTA did see some new accountability measures put in place, including the creation of a lobbyist registry, as well as a municipal Auditor General’s office. In terms of development, however, a new regulatory body to take over some of the Ontario Municipal Board’s powers has been slow to arrive.


Related:

Torontoist Explains the OMB


As it stands, the OMB is able to overrule the decisions of local councils regarding development decisions. Many high-rise development proposals (namely condos) are able to gain approval from the relatively lenient OMB, even after their proposals are rejected by the City. This has drawn the ire of many City Councillors, particularly Josh Matlow (Ward 22, St. Paul’s) and Kristyn Wong-Tam (Ward 27, Toronto Centre-Rosedale), who have vocally campaigned against the OMB.

Legally, CoTA gives the City of Toronto the powers to create its own development board to take these decisions out of the Province’s hands. The ability to place decisions regarding development into the City’s hands could have profound repercussions in terms of reigning in new development and making high-rise projects more cohesive with—and beneficial to—the communities around them.

With the City of Toronto Act now undergoing its mandatory five-year review, City staff have proposed a set of recommendations to give them tools they say they need. The staff report outlines the importance of CoTA in helping the City raise crucial revenue to support its operating budget, and recommends expanding some of the powers enshrined within it.

In particular, the report indicates that “[t]he City should have a range of financial tools available to meet its objectives and ensure its financial sustainability over the long term.” Without explicitly advocating for a sales tax to be included in CoTA’s powers, the report states that the current “blanket prohibition” is posing significant challenges for the City in terms of raising revenue.

Alongside a potential sales tax, the report indicates the City Council has already expressed interest in implementing current CoTA powers in the form a hotel tax and a new highway toll (yes, that one), which suggests that, after years of stagnation, COTA could once again become an effective revenue tool for the City.

While the City of Toronto Act has attracted relatively little media coverage and public interest, it remains a vital part of municipal political structure. Depending on what political winds blow over the next few years, the limited or expanded scope of COTA powers could be crucial to helping shape our city’s future, for the better or worse. What will determine much of the difference is whether we choose to care.

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