Economic Club of Canada Address by Mayor Rob Ford

7/31/2019 Economic Club of Canada Address by Mayor Rob Ford

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Notes for Remarksby His Worship Rob Ford, Mayor of Toronto

to the Economic Club of CanadaJune 5, 2012

Building on our Foundation, Creating a StrongerToronto

Good afternoon everyone, it's a real pleasure to be here at the Economic Clubof Canada to talk about how we're going to create a stronger Toronto.

Toronto has taken great strides forward since December 2010. Weve turnedthe tide on out-of-control spending and are working more efficiently than everbefore. There is still room for improvement and we will continue ourdisciplined efforts to improve efficiency as we close the gap between projectedspending and revenue growth.

The good news is, Toronto is now closer to achieving a sustainable fiscalfoundation than at any other time since amalgamation. We balanced this year'soperating budget using about $100 million in one-time funding from a prioryear surplus. At the end of our first quarter, we are already projecting a $90million positive variance for the current year much of which is sustainablesavings. That means our current year actual will be very close to balancedwithout one-time draws. Folks, that's amazing.

Today, I'd like to talk about two things. First, let me tell you some of whatwe've done to rebuild our fiscal foundation in Toronto. Second, I'd like to talkabout one exciting initiative that will help us build on this foundation to createa Toronto where people from around the world will aspire to live, invest &

thrive.

It's been a very busy 18 months since I was sworn in as Mayor. In that time,we've focused on four priorities: Reducing the Size and Cost of Government;Ensuring Customer Service; Improving Transparency & Accountability; andImproving Transportation. We've achieved many things our critics said wereimpossible.

This April, we re-negotiated our relationship with the city's unionizedemployees. We spoke honestly and frankly with union leaders and webargained hard to achieve negotiated agreements that were fair andreasonable for both employees and taxpayers. At the end of the day, we saved

over $150 million and we won increased management flexibility that will letcity managers improve customer service while reducing costs. And, all of thiswith NO labour disruptions.

Beginning this August, a private contractor will begin collecting garbage fromall homes west of Yonge Street. Our critics said we could never save money.But, I'm happy to say Toronto will save $11.5 million every year for the nextseven years under our new contract with Green For Life.


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Last year, the public lost confidence in the management of Toronto CommunityHousing Corporation Canada's largest social housing provider with over160,000 tenants. I've been to many of these buildings and met thousands ofresidents. I am sad to say the City of Toronto is a terrible landlord. But thatis changing.

We took action. We replaced the board of directors with a new action-orientedboard led by an outstanding Chairman Bud Purves. Two weeks ago, TCHChired Eugene Jones as its new CEO. Gene has led social housing change inIndianapolis, Kansas City and Detroit. We're making tough decisions toeliminate the backlog of critical repairs to housing stock and I continue tohope the province will support us in this important work.

We designated the Toronto Transit Commission as an essential service andhired an exciting new CEO Andy Byford who is refocusing our transit systemon operational excellence.Andy has a long road ahead of him, but we're already seeing improvements.

And both TCHC and the TTC are working better with the City than everbefore. Thats important because Toronto subsidizes these agencies withhundreds of millions of dollars every year.

Last year, we launched the most comprehensive service review process thecity has ever seen. It's already achieved hundreds of millions of dollars inefficiency savings and become a model for other governments across Canadaand around the world. Our focus on fiscal discipline is beginning to change thecorporate culture at the City. In 2012, we will spend less money than we did in2011. That's unprecedented.

We are reducing the size and cost of government in a way that few residents

will ever notice. They are noticing, though, that their taxes have not beengoing up like they used to.

While we were pushing managers hard to find savings for 2012, they begansaving money in 2011. Much of last year's operating variance was due toefficiency savings. Managers everywhere are starting to say "Hey, maybe Idon't need three of these!"

At the same time we were reducing City spending, we also reduced the cost ofliving for Toronto taxpayers. We eliminated the $60 Personal Vehicle Tax on

January 1, 2011 putting $64 million back into taxpayers' pockets. We had a0% property tax change in 2011 and actually reduced some non-residentialtax rates. In 2012, we held the line at 2.5% that's less than inflation. And,for 2013, we will target a tax increase of less than 2%. Also, beginning in2013, we will introduce a multi-year operating budget that will make it easierto manage the city more effectively from year to year.

Ladies and Gentlemen, we are on the right track. But, dont just take my wordfor it. In May, Moody's bond rating agency confirmed the city's AA1 creditrating after downgrading the province's rating just weeks before. Moody'slikes what we're doing maintaining strict fiscal discipline.


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However, they also warned that our credit rating could be downgraded if westart to do what many Councillors want us to do: ignore fiscal prudence andbegin spending, spending, spending and borrowing, borrowing, borrowing. Wecan't afford to slide backwards like that. We've worked hard for the past 18months to rebuild our fiscal foundation. We must protect what we've achieved.

And, we can begin looking forward to an exciting new Toronto built on thissustainable fiscal foundation.

Moving forward, we must create a new business model for the City. We knowour expenses go up every year. We've proven we can slow this growth bybeing very disciplined about cost control. But, we cannot stop it completely.So, we will need new ways to increase our revenues each year to cover thiscost.

In the past, we've increased our tax rates to do this. But that is simply notsustainable. No business expects to earn more revenue each year simply byraising its prices. Smart businesses look to grow revenues by selling more of

their products and services at the same price. The city needs to do the samething.

Property tax is the single biggest chunk of revenue we earn. In essence,Toronto is in the property business and property tax is the price people andbusinesses pay to locate in Toronto.

Every year, our tax base grows as the city attracts new businesses andresidents who pay property taxes to the city. This Assessment Growth is part ofthe solution to growing Toronto's revenues.

To sell more products, most businesses devote significant resources to

marketing and sales. The City, however, has never had a plan to grow itsassessment base. Instead, we receive a year-end report showing how muchour assessment base has grown. We are entirely reactive. It's time to becomeproactive.

Toronto needs a plan to grow its assessment base strategically, so it cancontribute more to the wealth and wellbeing of our city.

We also need to get serious about attracting more jobs to our city. Toronto'sunemployment rate is consistently higher than the national average andhigher than surrounding cities. In 2011, the national unemployment rateaveraged 7.5%. In Toronto, our unemployment was 9.5% -- even higher for ouryoung people. That 2 percent gap is equivalent to about 50,000 jobs. I wouldlike to see this gap closed within five years.

Higher unemployment means people find it harder to live here. It drives up oursocial services costs and hurts families.We need a plan to proactively grow our assessment base in a way thatencourages job creation.


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Ladies and Gentleman, the next major piece of work I plan to advance is anEconomic Development Strategy for the City of Toronto.

There are 189 construction cranes in the skies of Toronto. That's more thanany other city in North America. In fact it's more than New York and MexicoCity combined. That's an amazing "skyline of opportunity." However, almost

all of those cranes are building residential units because people love living inour city.

I want to continue seeing cranes in our skies. But, I want more and more ofthose cranes to be building commercial space because commercial spacemeans permanent jobs for city residents. And, it means Assessment Growththat will help us pay our bills.

Right after I was elected, my transition team began talking with City managersabout developing this strategy. It would not just guide the city's economicdevelopment division but would also shape a master strategy for the city as awhole. Since then, we've been working with Councillor Michael Thompson

the Chair of our Economic Development Committee the City Manager and ourGeneral Manager of Economic Development.

A draft Economic Development plan was presented to Committee in February and further staff work is currently underway. I hosted my first EconomicRoundtable in April and heard directly from local business leaders about whatthe city should do.

I expect our Economic Development Strategy should be ready for Councilapproval this Fall. This Strategy will help shape our Assessment Growth andencourage job creation in Toronto. It will help the City pay its bills and helpcreate an environment that enables our businesses and residents to thrive.

We will establish aggressive but achievable targets for assessment growthand job creation. We'll break these targets down by industry and marketsegment and assign objectives to city divisions and our agencies. And, we willget all our resources pulling in the same direction.

I'm not ready to talk about how we will achieve these targets because the planis still being finalized. But, here are some thoughts on five major areas weneed to improve.

1. First We must make our Development Process better.

It takes too long and involves too much red tape to plan and build newcommercial space in Toronto. This must improve.

Our Economic Development and Planning activities must be better integrated.

Our new Official Plan and Harmonized Zoning Bylaw should promoteinvestment and job creation rather than just regulating and controllinggrowth.


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We must prioritize job-creating development that shapes an environment thatbusiness and residents desire.

2. Second We must make Toronto more cost competitive.

It costs too much to develop and operate commercial space in Toronto.

Right now, our commercial property taxes in Toronto are too high. Onebusiness owner told me he would pay $600,000 per year less if he moved his100 person office to Mississauga. Toronto is losing out like this every month.

That needs to change. Businesses that move outside Toronto pay nothing tomaintain our city services.

3. Third We must be better at marketing and sales.

We must attract new businesses that will create jobs and bring in new money

to the citys economy. We have to understand what they want, and findinnovative new ways to provide it.

We need to improve our customer service and make it easy for new businessesto do what we want them to do.

We need dedicated and skilled people who can create strong deals and closethe sale.

Existing businesses must also be encouraged to expand in Toronto.

4. Fourth We must align everything the City does to support our strategy.

We need to attract talented residents who will attract employers. Thesetalented workers are drawn to an affordable, attractive lifestyle. Everything wedo from culture and recreation to community infrastructure and solid wasteshould help make Toronto attractive and affordable.

5. Fifth We need to make it easier to move around Toronto.

Transportation plays a critical role in our city strategy. We need roads,highways, airports, shipping ports and rail yards that make it easy andaffordable to move goods in a "Just in Time" economy.

We also need to make it easier for employees to get to and from work, andcustomers to reach businesses.

I will host my first Transportation Roundtable in the Fall to kick start thisstrategic planning process.


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There will be many other things we must do. But, let me conclude by saying Toronto should be the city where people and businesses, from around theworld, MOST want to live, invest and thrive. That's what I want for Toronto.

To get there, we need a plan. Today, we have multiple City divisions anddozens of agencies that are all trying to do good work. But, too often they

seem to be working independently. This needs to change.

We need a unified strategy. It's time for Council to develop a new 10-yearstrategy for the City of Toronto. It should start with the new EconomicDevelopment strategy were working on now. It should also include a revisedOfficial Plan and Harmonized Zoning Bylaw because Economic Developmentand Planning should be two sides of the same coin.

Weve done a great deal of work already in rebuilding our crumbling fiscalfoundation. Now, it's time to prepare a plan to maintain our sustainablefoundation and to build on it, the city we all want.

Its an exciting opportunity. It will be a lot of work.

But, Im used to working hard. And Im excited about moving forward.

Thank you.

Documents

Economic Club of Canada Address by Mayor Rob Ford