28 replies to this topic

[Shwa]

‘New mayor, new deal’: Ford seeks public cash for subway

Mayor Ford went to Premier McGinty yesterday morning to try and obtain funding for one of his pet projects, a campaign promise, that he had initially said would be funded in part by the 'private sector.' Because we all know how the 'private sector' just loves to jump in and sink billions into public transit systems.

Yeah? Well where is the private sector funding now? How come 'Ford Nation' isn't jumping on board to hand over their hard earned pennies and pay for it?

If Mayor Rob Ford had convinced anyone the Sheppard subway expansion would be paid for with corporate cash, he shattered the illusion on Wednesday.

In a morning meeting at Queen’s Park, Ford asked Premier Dalton McGuinty to give the city $650 million for Sheppard by 2014. His justification: $333 million in federal money depends on that provincial money.

For a mayor who said in April that the $4.2 billion Sheppard project would not require a major government investment — “I’m not quite sure where taxpayers’ money is coming in when we’re using private money,” he said — the request represented a notable turnabout. It also provided ammunition for critics, transit experts among them, who say the project is not feasible.

Under the March agreement that killed the Transit City light-rail plan, the province agreed to direct up to $650 million to the Sheppard project if it had leftover funds from the Eglinton-Scarborough Crosstown LRT project, for which it is paying.

“It’s important to taxpayers, and it was clearly stated during the election,” he said. “People voted in that area, you look at the poll results, I campaigned on the Sheppard subway and people supported my platform.”

“Here we had a fully funded, fully committed plan. He’s turned that down, and now he’s going cap in hand to the provincial government,” Mihevc said. “This is a betrayal of the mayor’s initial commitment, which was that he’d get this money from the private sector. It’s interesting that he’s now at the dole of the province to fund this ill-fated project.”

Edited by Shwa, 18 August 2011 - 04:21 AM.

[Black Dog]

“It’s important to taxpayers, and it was clearly stated during the election,” he said. “People voted in that area, you look at the poll results, I campaigned on the Sheppard subway and people supported my platform.”

Ford indeed pledged to build subways, including the Sheppard line, but ask anyone and they'll tell you they want subways. The question is whether a subways-at-all-cost approach is actually realistic and if major infrastructure projects should be undertaken based on the ever shifting whims of the electorate.. Anyone with half a brain could see that Ford's plan for a privately-funded subway to nowhere was a fantasy from the get-go: that he clings to this delusion (even as he dispenses with other campaign promises like a snake shedding its skin) is odd to say the least.

[capricorn]

Mayor Ford went to Premier McGinty yesterday morning to try and obtain funding for one of his pet projects, a campaign promise, that he had initially said would be funded in part by the 'private sector.' Because we all know how the 'private sector' just loves to jump in and sink billions into public transit systems.

Yeah? Well where is the private sector funding now?

As you well know, the private sector does not operate like the public sector. The private sector will not jump into a project until federal and provincial funding is assured.

In that meeting, Ford asked the premier to put up $650 million from the province to ensure that a federal investment of $333 million originally slated for the now-defunct Transit City light rail plan would go to Ford's plan to build a subway along Sheppard.

The federal money is only there for the subway if the province can come up with $650 million. And the province has only agreed to provide that after it's determined whether that amount would be surplus to its own mega transit project - the underground light rail Eglinton cross-town line.

Ford told reporters that the public sector funding was essential to attracting private sector investment in the line.

Carroll, who chaired the budget committee in Mayor David Miller's second term and represents a ward where the Sheppard subway would be built, said Ford should have figured that out a long time ago.

She said that generally, the private sector waits until there is significant public sector investment in a project before getting involved itself.

"Generally in the rest of the, say, world," said Carroll. "That's how it works. The private sector wants a comfort level. There's going to be digging in the ground. There's going to be interaction with the community where they're building the subway, which will come up through the orders of government. If he wonders why there isn't a lineup for private sector builders - they're waiting for those senior orders of government."

http://www.insidetoronto.com/news/cityhall/article/1058320

Politicians are in it for the votes, the private sector is in it to build reputation/goodwill and for profit.

Yes, Ford initially included the private sector as a potential partner to the venture. That's not unheard of when municipal politicians pitch major transit projects.

[Shwa]

As you well know, the private sector does not operate like the public sector. The private sector will not jump into a project until federal and provincial funding is assured.

http://www.insidetoronto.com/news/cityhall/article/1058320

Politicians are in it for the votes, the private sector is in it to build reputation/goodwill and for profit.

Yes, Ford initially included the private sector as a potential partner to the venture. That's not unheard of when municipal politicians pitch major transit projects.

Well it is nice to see the private sector is willing to jump on to the taxpayer teat as well. Where's the outrage?

[Black Dog]

As you well know, the private sector does not operate like the public sector. The private sector will not jump into a project until federal and provincial funding is assured.

So why did Ford turn his nose up at provincial funding for Sheppard in the first place when he killed Transit City?

[capricorn]

Well it is nice to see the private sector is willing to jump on to the taxpayer teat as well.

First, you criticize the private sector for not coming up with money for the transit project, now you criticize them for wanting to participate. Do you or do you not want private money invested in transit?

Where's the outrage?

You have enough for both of us.

[Black Dog]

First, you criticize the private sector for not coming up with money for the transit project, now you criticize them for wanting to participate. Do you or do you not want private money invested in transit?

I know this wasn't aimed at me, but I would like a mayor who actually understands how these things work before barging ahead with bad policy.

[Remiel]

Tell Ford he can pay for his own damn campaign promises. Why should the everyone else in the province pay to save his ass?

[guyser]

Tell Ford he can pay for his own damn campaign promises. Why should the everyone else in the province pay to save his ass?

Same reason the rest of Ontario benefits from TO tax money.

That said, Ford should have seen this coming.

[Shwa]

First, you criticize the private sector for not coming up with money for the transit project, now you criticize them for wanting to participate. Do you or do you not want private money invested in transit?

Yes, I want private money invested in transit, but not dependent on government having to pull their teat out first. Doesn't that make sense to you?

[Shwa]

Same reason the rest of Ontario benefits from TO tax money.

That said, Ford should have seen this coming.

Yes, he should have seen it coming.

Cohn: Ford digs himself into a subway hole

A week is a lifetime in politics; eight months, an eternity.

The last time he swaggered into Dalton McGuinty’s office, Rob Ford was at the top of his game — lording it over the premier, wearing his fresh electoral mandate like a wrestler’s prize belt. After a mere 25 minutes, the mayor emerged triumphant last December to declare he’d remake Toronto’s subway system in his own image.

Now, Ford has returned to Queen’s Park showing his tummy to a Liberal premier who appears, eight months later, to have nine lives in the opinion polls. His swagger gone, the mayor is asking for a modest “advance” to dig him out of a financial hole so he can start tunnelling the Sheppard subway extension.

Bereft of his once-shimmering prize belt, Ford looks increasingly like a mayor with no clothes — but for the cap in his hand.

Edited by Shwa, 18 August 2011 - 09:48 AM.

[capricorn]

Yes, I want private money invested in transit, but not dependent on government having to pull their teat out first. Doesn't that make sense to you?

I don't know what you mean by "not dependent on government having to pull their teat out first".

[Black Dog]

I don't know what you mean by "not dependent on government having to pull their teat out first".

If Ford knew that public money was required to kickstart private investment in this project, why did he agree to taking the leftover scraps from Eglinton instead of asking for the Sheppard money up front?

[Shwa]

I don't know what you mean by "not dependent on government having to pull their teat out first".

Here's two takes, from the Sun in Feb and from the Torontoist this week:

Ford's transit plan big, bold and risky: Editorial

Toronto will finally have a mature transit system, without breaking the city's bank or being funded by property taxpayers.

But if Ford blows it, we'll be facing a financial disaster that could be more than three times as big as the $1.5-billion deficit Montreal was left with after the 1976 Olympics.
...

Ford's gamble lies in the fact the estimated cost of funding the three big transit projects is up to $13 billion, leaving the city potentially on the hook for up to $5 billion, unless it can raise the money privately. (Ford's people think they can do the deal for less.)

Ford believes he can get the money he needs from the private sector in return for giving developers construction and retailing rights along the Sheppard subway.

But at the beginning, the city would borrow against anticipated future revenues from new development along the line, to entice a private partner into the deal.

Rob Ford's Subway Derailing Fast

Ford, private sector champion, previously negotiated with the province to reallocate most of the funding that had been set aside for the Transit City light rail plan, and direct it instead to the Eglinton line from that plan—except now the plan is to bury the central portion of that route underground, a much more expensive proposition. Part of the understanding in that earlier negotiation was that Ford would find private sector funding to build the Sheppard subway line he so wants (another revision to Transit City, which had Sheppard getting a light-rail line rather than a subway). For months, Ford has told anyone who would listen that we don't need public taxpayer money to build Sheppard, that his new style of governance would tap the hitherto unplumbed depths of corporate honeypots, and that companies would line up to invest in the subway based on a promise of future revenue.

And yet, despite his commitment to private sector financing, despite his repeated protestations that "there is only one taxpayer," despite years of condemning his mayoral predecessor for asking the province for money rather than spending less, today Ford marched into McGuinty's office today and asked for $650 million.

That figure isn't random. The previous version of the Ford/McGuinty agreement stipulated that if there was money left over from building the Eglinton LRT and one other transit project (rebuilding the seriously worn-down Scarborough RT), up to $650 million of it would be put towards the Sheppard subway.

The problem, from McGuinty's point of view, is that he has no idea yet if or how much money will be left over from those other projects—seeing as they haven't been built yet...

So... where are the private sector investors? Or does the province have to fork over $650 million first?

Well, Mayor Ford did ask for a couple of million to do a business plan...

[capricorn]

So... where are the private sector investors? Or does the province have to fork over $650 million first?

If my understanding of how consortiums or partnerships for such projects operate then, yes, the province would have to commit a set amount of money, as would all parties involved and a contract drawn up. Otherwise, I don't see any private investors wanting any part of the deal.

Well, Mayor Ford did ask for a couple of million to do a business plan...

Regardless of where that money comes from, it seems to me a business plan for such an ambitious project is essential. It would be interesting to know how Ford thinks the Eglinton project will come in under budget. Experience tells us that cost overruns with such projects are to be expected.