Cities in the Time of COVID-19: How Will Local Governments Deal with the COVID Cash Crunch?

In partnership with the Institute on Municipal Finance and Governance. Featuring Noreen Kassam, Director of Finance, City of Burnaby; Kelly Paleczny, General Manager, London Transit; Mary Persson, Deputy City Manager & CFO, City of Edmonton; and Enid Slack, Director, IMFG

5 Key
Takeaways

A roundup of the most compelling ideas, themes and quotes from this candid conversation

1. Short-term crunch vs. long term needs

Municipalities are facing enormous fiscal pressures because of COVID-19. Cities require two strategies — one to face the immediate financial crunch and another to guide them toward long-term economic stability. Cities must find the money to continue to ‘keep the lights on’ and provide necessary services for residents — and especially the most vulnerable.

2. The burden of debt shouldn’t be kicked down the road

Across the board, cities are faced with a tough calculus. Some short-term solutions — such as borrowing from capital reserves, as BC municipalities are now allowed to do — may come at the expense of longer-term priorities, such as fixing and replacing ageing infrastructure, or building new infrastructure. On the question of debt, one of the panelists suggested that it may be better for municipal governments to find other ways to balance their spending now, instead of passing the burden onto the future.

3. What revenue tools will help us get out of the hole?

During and after the crisis, most cities will not be in a position to raise property taxes — where they get the bulk of their revenues — as residents and businesses get back on their feet. We need other ideas. Road tolls could bring in additional revenue while also limiting a potential spike in individual car usage. A municipal share of the income tax was also discussed.

4. The conversation about public services needs to happen

The financial crunch has provided an opportunity to reflect on the services municipalities provide to their residents. Cities and their provinces need to address whether municipalities will have the necessary resources to meet the needs and expectations of their residents. If a municipality cannot afford to deliver essential services during this challenging time, then other possibilities must be explored. However, every option (e.g. uploading responsibilities, public-private-partnerships, etc.) comes with its own tradeoffs and must be carefully and collaboratively considered.

5. Cities are more than just ‘creatures of the province’

During COVID-19, every order of government has been at the table together, collaborating on solutions. Coming out of the crisis, that collaboration should continue, and there is an opportunity to reevaluate who does what between the municipalities and provinces, and the role of the federal government.

Full Panel
Transcript

Note to readers: This video session was transcribed using auto-transcribing software. Manual editing was undertaken in an effort to improve readability and clarity. Questions or concerns with the transcription can be directed to events@canurb.org with “transcription” in the subject line.  

Mary Rowe [00:00:32] Everybody, it’s Mary Rowe from the Canadian Urban Institute.

Mary Rowe [00:00:34] We’re really pleased to welcome you back to City Talk. This is our second this week and we have another one tomorrow. We have a slight time change.

Mary Rowe [00:00:42] We appreciate those of you that we’re able to pay attention to that to see that that in fact, we are 30 minutes later stand today because one of our panelists had a council meeting scheduled that we had to accommodate. This CUI, I mean, Canadian Urban Institute is in the connective tissue business. We’re about how we actually maintain connections across the country and how we actually learn from each other and have the kinds of appreciations where what everyone is dealing with. And that’s why we have participants here drawn from different municipalities and cities across the country, as we’re trying to do with each of the city talks. We try to make sure that we’ve got representation from across different places. As many of you know, we put up some platform since COVID. One is CitySharecanada.ca. One is citywatchcanada.ca And this is a third citytalk Canada.ca. They’re keeping track of what municipal governments are doing and what everyone else is doing it. We power these with partners and volunteers from across the country and so we encourage you if you’ve got some bandwidth and some spare time, if you can put an hour in or half an hour and you can help us watch or track or share. That would be great. E-mail us at COVIDresponse@canurb.org. COVIDresponse@canurb.org. And the this program originates in Toronto and Toronto is the traditional territory of the Mississaugas of the Credit, the anishnabeg, Chippewa and the Haudenosaunee and the Wendat peoples. Now it’s the Wendat peoples and it’s now home to many diverse First Nations, Inuit and Metis folks from across Turtle Island. And we also acknowledge that Toronto is covered by Treaty 13, which was signed with the Mississaugas of the Credit and the Williams treaties, which were signed with multiple anishnabeg nations. And we are very cognizant of that and the traditional territories in which we reside. And I’m sure that my other panellists will probably acknowledge their own attachment to the First Nations that they are indebted to. These conversations are intended to be candid and people participate here as individuals. So even though they may work for a particular municipality or an institute or another or they have clients, we always say at the outset of these that people are speaking to us as individuals and so they’re free to do that and we encourage them to do that, recognising that they have a constituency that they represent or that they’re accountable to. The other thing that we’re cognizant of is that this these conversations are taking place in parallel. While we still have thousands and thousands of Canadians who are on the front lines, many who work for the municipalities that are represented here on the front lines, doing emergency services and saving lives and trying to keep people healthy. And these conversations are in no way intended as a substitute for that or to supplant or interfere with those, because we’ve been very conscious at CUI to be supportive of the existing networks that were in place to respond to the crisis. And in fact, these folks, many of them work for municipalities. That’s exactly what we’re going to talk about is the financial toll that’s taken on all the first line services that municipal governments are responsible for providing in Canada. And what are the implications of that? So and the conversations are very much structured around what works, what’s working, what’s not and what’s next. And they’re practical, grounded in the practical. So we’ve always said to our panellists, we hesitate getting too involved in prognosticating or speculation. We really try to stay grounded. The real and these folks are all grounded in the real. And that’s why we’re so appreciative to have them joining us, talked about individuals.

Mary Rowe [00:04:14] There’s a chat function here. So if you look on the screen, you’ll see that you have the capacity of people that are dialling in that you can engage with with the panelists, that you can even more importantly, engage with each other by typing into the chat function. We we hold the chat function, we continue to keep it and then we glean from it. And sometimes we post some of it back up on city talk. Or some of you may have seen that because some really interesting things are posted on the chat and I’ll keep an eye on it and filter it back into the panellists. But feel free to respond to one another. And on your chat function, you’ll see there’s an option for you to choose. Whether you want to send a message to panellists or the panellists and everyone, we’re going to encourage you to send it to everyone because there may well be somebody on the chat who can answer more quickly on the particular question you have. The other thing that we’re finding with the chat is that people are putting up resources there. They’re putting up links to articles and books, and we’ve had all sorts of things. So as this team starts to give us suggestions, staff or whatever, they pop out, staff were posted on the chat function, unlike in Vegas, where I think stay in Vegas. If you put something up on that chat, it lives forever. So just be conscious of that, that whatever you put up there, it’s going to be seen by whoever and it’s going to be seen for a long time because we keep. You know, we’re recording so the this discussion that these girls have with each other will be posted on a city Talk Canada forward slash city talk in a day or so. And we also are pulling highlights. So every brilliant thing they say, we will summarise somewhere and you’ll see it again.

Mary Rowe [00:05:46] You can watch it again. You can share it with your colleagues if you’ve got people that didn’t have time to tune in at this time. You can send it to them and encourage them to watch it again. So it’s midday here in Ontario. It’s a slightly earlier on the West Coast. We appreciate that people accommodate different time zones.

Mary Rowe [00:06:02] And this is just the beginning of a conversation, not only with the chat live on well posted, but also you, those of you in a parallel universe on Twitter can tweet on this hashtag city talk. I’m not going to give you detailed biographies for each of the folks that are on the call today, because we usually just post a link on the chat functions so you can look them up. And these are esteemed people. And I would be. They go on, take it out of a panel for me to quotes through their bios. But you know what? You will be lost on you that this is an all female session. In the preview, Clark said that years ago, she was on a panel with all women and they were affectionately referred to as the tax chicks. So we’ve got tax chicks Twenty twenty COVID tax chicks, I guess. And I’m going to ask them each at the outset to just give us a primer, a couple of minutes on what are they seeing, what’s going on in their particular jurisdiction or their particular purview. And then when they’re done that, then we’re going to have some conversations about the immediate situation that John everyone is facing right this minute. And then what are the implications of the next couple of minutes and then over obviously a few more years. So let’s go all the way across the country, if we could. First we have from Burnaby, Noreen Kassam. So start us off. Can you from the west would go from west to east. Noreen, were keen to hear what you can tell us. We see those hearts behind you, which is a very positive thing to have behind you. So welcome, Noreen.

Noreen Kassam [00:07:32] Thank you very much. And thank you for the opportunity to speak today. I do have a little bit of a script just to get me started. And then. But definitely we’ll have more conversation as we move along. This is an unprecedented time and it has brought about unprecedented situations.

Noreen Kassam [00:07:47] The financial implications to local governments resulting from the COVID 19 pandemic are severe for the city of Burnaby. Facility closures, including recreation centres with pools and skating rinks, libraries and cultural centres have translated to millions of dollars in lost revenues. Unanticipated costs related to the pandemic are well beyond normal spending patterns. The pandemic is forcing a finance crisis that local governments will have a difficult time recovering from. Loss in revenues and additional expenditures has forced the city of Burnaby to lay off hardworking and committed staff continuously looking at ways to reduce costs by adjusting operations and cancelling or deferring needed projects in the community. However, these acts are not by any means slowing the financial drain. In addition to the permanent loss of revenues, there are imminent risks to cash flows related to the delinquency of property taxes and utility fees, which are the primary sources of funds that sustain local government operations. Covering local government funding losses through future property tax increases will not be a viable option given the significant impact it would have on households, businesses, a non-profit partners who are trying to weather the economic downturn and recover themselves in the coming years. In mid-April, the B.C. provincial government mandated some measures around delaying penalties on property taxes for businesses to October, which is later than normal. When we collect our property taxes as well. Local governments have mandated for us to continue to pay our other authorities earlier than normal to allow for payments before receipts of funds. The government has lifted restrictions for access to legislated reserves. While this access will provide short term financing, most revert reserves have been carefully built over time and are focussed on the renewal of aging infrastructure that are currently well beyond their useful lives. These measures in place collection risk in the near term and hardship in the future to replenish our reserve, our reserves. Local governments and B.C. are lobbying the provincial governments and federal government for grants to cover COVID related revenue losses, as well as the expansion of provincial property tax deferral programs. Lastly Local governments are doing even more with less. Vulnerable populations, specifically, the homeless and seniors are struggling in the communities during this time. Programs previously offered by other levels of government have been downloaded to local governments. It will take time. Senior government supports and prudent financial management recover from this adversity. Once again, for the opportunity to share my comments with you today.

Mary Rowe [00:10:22] Thanks, Noreen. Well, we’ll we’re going to follow up on a lot of those points because, of course, Burnaby as part of a region. And we want to hear about how that’s going to get sorted as well. So let’s now go to London, if we can, please my hometown, where Kelly Pelczy, let me just say it right, Pelczy, Kelly Pelczy.

Mary Rowe [00:10:40] As I said from my hometown and dealing with a lot of changes in the transit system. So, Kelly, we’re keen to have you in keen for you to give us a picture of what you’re dealing with.

Kelly Pelczy [00:10:48] Thank you and I’ll start the conversation speaking more generically in terms of transit systems across the country. Essentially, you know, essentially, I think the easiest way to say it is public transit services have been turned upside down during this during this period. All of the metrics that we’ve historically relied upon to make sure that our systems are operating effectively and efficiently, things like maximizing the rides per service hour relying on recovering at a minimum of 50 percent of our operating costs, passenger fares and ensuring that our operators provide access to exceptional customer service have essentially all been abandoned during this period. Just just in order for us to be able to operate, many of the systems across the country have moved to reardoor boarding that was done an effort to protect our operators, you know, from and provide for social distancing. But what that halted and is our inability to continue to collect fares and what and and the the ultimate effect of that is a nationwide shortfall of approximately $400 million per month. So it’s that that’s not small money that we’re talking about and that’s going to affect municipalities across the country.

Kelly Pelczy [00:12:01] Systems have also attempted to limit the number of passengers on buses again to provide for that social distancing. What that means is that’s further impacting the the efficient ways in which our our systems have traditionally operated. And the last piece I’ll all say it in terms of an intro is the move to rear door boarding has essentially eliminated the customer contact with the operator. So that whole customer service perspective has also essentially been eliminated, which is tough. We’re in the customer service business and we’ve lost that face to face, that front line connection with our customers.

Kelly Pelczy [00:12:38] And that’s something that we know is critical and we’ll certainly be critical going forward as we tried to attract riders back to the system, as we as we map our way out of this situation.

Mary Rowe [00:12:50] Thanks. Thanks, Kelly. I really. 400 million a month. That’s a bit of dough. Extraordinary

Mary Rowe [00:12:56] OK. Let’s go to my namesake, Mary Mary Persson who’s in the City of Edmonton and who’s mayor tweeted saying, listen to her. She’s pretty darn smart. Glad to hear the mayor say some things about Mary, we’re happy to have you tell us what you’re seeing in Edmonton. We’re really interested in your perspective.

Mary Persson [00:13:13] Thanks. So in Edmonton, like we’ve been moving from merrily running the city, we think, to running a city in crisis.

Mary Persson [00:13:21] So in amongst other organizations that are running their organizations, be it public sector or private sector in crisis. But we are still providing essential services and trying to prioritise those based on safety and helping our residents adapt to this pandemic as best we can. I really tried to refrain to call this the new normal because it’s a very strange new normal if it is. We’ve taken a lot of steps to maintain public health. Some has been have been a result of provincial directives and some on our own. So things like the closure of rec centres, the road closures for pedestrian spaces to space further out, a real problem with our homeless shelters and us having to step out, step up with the local we’re going we don’t like to call it, but it’s a field hospital. The Expo Centre, which is one of our convention centres. But with all that, the financial effect has been immense. If we get back to normal by mid-September, which is the the model we’re using right now, that we do have three. We’re going to lose over about $160 million in revenue alone. And the total financial impact will be approximately another hundred million by the end of the year. Just with that slow return to recovery and you’ll see that the FCM has asked, they said that all cities are going to lose between 10 and $15 billion. So I I truly recognizes that Edmonton is not alone in this vote. We’ve also like Burnaby. We’ve had to lay off very hardworking people. It’s temporary layoffs. It’s out of respect to the tax payers. But we’ve also been redeploying people, homelessness, transit, emergency services. We have been trying to help our citizens through property tax deferrals, rent lease abatement or deferrals at this point and trying to balance that with a capital capital stimulus program to keep people at work. So COVID has been a big hit to our community, but we are trying measures to prevent the spread and we think it’s working. We actually have fewer cases than other cities and areas in our province. Then we are very happy with the residents who are trying to follow the rules and continue to proceed with their lives as normal. But while respecting the physical distancing. So this has been a collective effort on behalf of citizens, the cities and provinces.

Mary Rowe [00:15:41] So it has been sort of an all hands on deck thing, isn’t it? I mean, everybody has got to do their bit, take their ticket, take one for the team kind of thing. OK, I want to come back to a number of things you raise, but let’s go to Enid Slack, who is at the University of Toronto with the Institute of Municipal Finance and Governance Unit. Big picture. Tell us, what are you seeing?

Enid Slack [00:15:58] Well, I think the picture that you’re hearing from the other panellists today is this is very real.

Enid Slack [00:16:04] Municipalities are facing enormous fiscal pressures because of COVID-19. I think on the one side of the ledger, you’ve got expenditure increases and changes, the biggest hits on the revenue side.

Enid Slack [00:16:19] But just on the expenditure side, you can hear all the things that transit systems and cities across Canada are doing. And, you know, this increased costs with public health, social services to an Ontario case, emergency services. Municipalities are changing their I.T. systems so people can walk at home.Theres personal protective equipment, PPD that they have to buy more cleaning buildings. So there’s a lot of expenditure differences. At the same time, there’s an expenditure decline because some facilities are open, libraries, recreation centres. So there are some savings there. The real pressure, though, is on the revenue side. We’ve heard that many municipalities are deferring property taxes. What does that mean? You get a property tax bill and the cities are saying, well, you have 60 days and maybe 90 days to pay that bill that no interest, no penalty. So the municipalities are using penalty income, but they’re also not getting the property taxes right now. And they’re doing the same water bills. Transit revenues are way down because ridership is down. So huge pressures on the revenue side, pressures on the expenditure side. And as you know, in Canada, as in most places, municipalities are not allowed to budget for a deficit. In other words, they have to budget for a balanced budget. If something happens like what happened in 2020. There is a deficit.

Enid Slack [00:17:52] They’re required by law to pay it back at the beginning of the following year. And so municipalities are scrambling to figure out how how to fill that deficit. And we can talk about some of the ways they do.

Mary Rowe [00:18:08] OK. Well, Noreen, you hasn’t BC, isn’t B-C allowing BC municipalities to do something different? I thought they were I thought they were allowing you to run deficits. Correct?

Noreen Kassam [00:18:17] They’re allowing us to access our our restricted reserves. And we’re not is tempted with short term financing their allow us allowing us to do some additional short term borrowing. But eventually, that all has to be paid back in. And in the end, we’re gonna be taking from our reserves to as Enid said, to prepare to have a balance in the end because there’s no way we can have a deficit per say. And even if there is borrowing that flows into the next year, your pay, you have to pay it back pretty much right away. The borrowing from our capital reserves, they have allowed us to have a five year timeframe in order to pay them back. But, you know, it’s still not considered a long period of time. And as I mentioned earlier, you know, how are we going to pay that back other than getting it from the tax payers at some point? Right. Because our major sources of revenues are taxation.

Mary Rowe [00:19:05] I mean, this is a go ahead.

Enid Slack [00:19:08] It’s a short run, long run scenario, as Mary is talking about.

Enid Slack [00:19:13] There’s a cash flow problem right now and these solutions will help with that. But that money does have to be paid back. And I think people have to understand that when you borrow money and a municipality borrows money, it has to get that.

Enid Slack [00:19:25] And next year, you’re going to have people who are just getting back on their feet and have to pay their deferred property taxes.

Enid Slack [00:19:34] And now they’re going to have to also pay increased taxes because of this falling. This, you know, it’s a shortrun and long run in the long run, it’s unsustainability

Mary Rowe [00:19:46] So I just want to go back to, you know, it’s sort of the basics in terms of where your money’s going. And then let’s why are you so lacking in money right now? And then we’ll talk about the fixes.

Mary Rowe [00:19:58] So your money is being dropped, drained by. I mean, some of you would have had physical challenges probably before. Correct?

Mary Rowe [00:20:05] Or you were dealing with were you all flush? We’re all municipalities across the country just doing humming along fine before this happened?

Noreen Kassam [00:20:11] No, not necessarily. I mean, the push is always to keep property taxes as low as possible. Right. So you’re already into it to some sort of a crunch. You have to have. You’re trying to put money away, too, for a replacement of assets at some point that need to be replaced. And so no way. It’s absolutely it’s ongoing pressures. But right now, with the added loss in revenues, with the with the pressure to help residents and businesses, reduction of property tax rates deferrals. I mean, that’s just adding to the pressure even more.

Mary Rowe [00:20:40] They’re just pumping it down. We’re kicking the can down the road. Right. That’s right. It was actually a concern around the rental subsidies that initially the federal government solutions on rent were that loans and small businesses were saying, wait a sec, we’ll never recoup the dough. So. So in terms of what municipalities are doing themselves, so you’re I think you’re laying off. You’ve presumably reallocated resources. Because we’ve heard stories about planning departments going and working in shelters. And so staff are being redeployed in certain cases. Correct.? And are there other other than then layoffs? Have you, Enid hinted at this – are there some services that municipalities have gotten themselves out of so that they can save money on that side? So recreation stuff, I suppose. Right.

Noreen Kassam [00:21:24] With the closure of our facilities, we’ve definitely reduced our services to our citizens, but we’re also delaying hiring. We’re reducing costs in areas wherever we can. As you mentioned, the layoffs, we’re trying to postpone projects that would normally be spending on at this point in time.

Noreen Kassam [00:21:41] So there are quite a few measures being taken in order to weather the storm.

Mary Rowe [00:21:45] What about in Edmonton? Are you having to reallocate money? I mean, are you. Are you deferring capital projects, for instance?

Mary Persson [00:21:51] So we have consciously decided not to defer many cash capital, if any capital projects. We have taken some money out of our capital. We want to cash manage that. You know, there’s naturally some delays and in capital projects. So we’re gonna use a little bit of that cash management buffer.

Mary Persson [00:22:06] But basically, we have actually had some very long conversations with council about reductions in services. So not opening up some services, the turf management like changing of the street sweeping all those types of things. I’ve been on the table just to discuss how to manage our current within our current resources. So we, too, have done layoffs, temporary layoffs. Were not something we really wanted to do. So we did take a look at our non workforce budgets as well and reduced travel. No one can travel anywhere these days but travel, contracting some other pieces. We’ve delayed some IT projects as a result. It’s just really taken a look and making sure there’s a clear line of sight between what this does and the services provided. And and it’s been a lot of long, concerted efforts with council and with our executive team on that.

Mary Rowe [00:23:00] And your council meetings are meeting virtually?

Mary Persson [00:23:03] We are. We are we are restricted. I don’t know if it’s the same across the country, but fifteen. We only have councils. Committee meetings are suspended. But we take a look at our state of emergency weekly. So this afternoon is are we still going to continue in a state of emergency? So those service discussions are happening with council at that level.

Mary Rowe [00:23:24] Right. In terms of the transit stuff that you mentioned, Kelly, you’re absolutely right there. You know, part of what we’re wondering about is, you know, this term that’s used in the tech world by people under 30. Is it “sticky”? Are there certain things that you’re going to be introducing and that all sectors are introducing in a temporary way that may, in fact, be sticky, that we say, well, actually, let’s continue to do that. So I’m interested about rear door boarding, for instance. Do you know whether and I mean, you work for the transit authority. Are you guys looking at – are there efficiencies that you’re going to be able to maintain as your system comes back or not?

Kelly Pelczy [00:24:00] Certainly we wouldn’t look at rear door boarding as an efficiency per say. But as I touched on, it’s we’ve we’ve lost the customer contact. We’ve also lost the revenue. There are things we could do. Revenue collection tools could be moved to the rear door. That’s that’s something that I think any number of transit systems are looking at. Other transit systems are looking at implementing barriers around the operator area to provide for a better protection between the operator and passengers boarding. There’s any number of those things in terms of the enhanced cleaning that we’ve undertaken on our on our fleets and that type of thing. We strongly believe that’s something that’s going to stay in place because part of what we’re going to have to to manage on the way out of this is convincing passengers who have found alternatives that public transit still remains safe and it’s still a safe option going forward. So a number of those things that, as we said, have have resulted in increased costs, I think are going to be part of the the status quo going forward. And we’re going to have to find a way to incorporate those costs into our financial models.

Mary Rowe [00:25:05] You know, Enid, I’m just gonna stick with the three that are actually working, making tough decisions in municipalities for a second.

Mary Rowe [00:25:10] And I’ll come back to you. As opposed to the academic? That we always like to have an academic.

Mary Rowe [00:25:16] And you’ve got the big picture. We’re appreciative of it. But question for you, gals. And in terms of your municipalities, is there a particular lens that you’re that you are collectively using with your staff and counsel about how what services get cut? I guess they’re an equity lens. Is there a resilience lens? How do you make sure that you’re not cutting stuff that actually affects vulnerable populations, et cetera? Can you just give us a little bit of a window into how you’re making those trade-offs?

Mary Persson [00:25:43] I can start, I guess, is we do have some evidence-base. I’m not going to know them all off by heart, but we do have a number of principles and evidence based principles that do determine which ones get cut. And so there is a robust discussion around GPA plus lenses around the homeless, factors in the vulnerable populations. And frankly, some of the decisions we made were to protect those homeless populations, like free transit was not only about it was not only. First and foremost, it really was about the protection and the touchpoints around the cash and safety of our operators. But it did allow for some movement to create shelters because people are losing some other some other opportunities. So it’s always tough to balance all of those things. But we do have a lens that we use in evidence based criteria that we do use for for all of those that consider those factors.

Mary Rowe [00:26:35] Anybody else to get using some kind of lens that kind of helps with that?

Noreen Kassam [00:26:39] For us, it’s it’s really just back to what Mary said. You know, safety. Protecting our vulnerable population. We are in connection with the community. We are hearing from them. We are trying to understand what the community needs are and making sure that we’re attending to them.

Noreen Kassam [00:26:51] We, too, have a warming centres, which which, you know, help the vulnerable population. And, you know, we were supposed to close them on March thirty first. Well, we’ve extended them to May thirty first to make sure that we can attend to vulnerable populations out there. On some things just naturally don’t make sense to do right now. We were in the midst of a design of a community centre where we would invite the community for public consultations. Well now is not the time to do that. You know, so that’s naturally you can sort of stop that and defer that. But other than that, I mean, it’s really listening to the community understand and understanding the community’s needs and delivering the services that we need to deliver to ensure that there’s sustainability and livability going forward.

Mary Rowe [00:27:33] I mean, I sort of feel like what happened is this all descended upon us and municipal governments just had to roll their sleeves up and figure it out.

Mary Rowe [00:27:39] There was not there wasn’t a lot of time that I and I I I don’t know whether Canadians actually recognised which level of government provides a service or finances that I don’t think I don’t think people generally have a sense of, oh, that’s my property tax at work or oh, that’s my provincial income tax at work. So I think I hope when we come through this, people will really be aware that municipal governments were the ones that had to think on the fly all the time and they had to navigate with other levels and.

Mary Rowe [00:28:07] Oh, that’s it. Is that the medical officers decision or is that the Federal decision? I was interested. That declaration of emergency that you mentioned, Mary, that you’re re-examining that every week. One of the reasons we put city watch Canada up was because it was really hard for people in municipal governments to know who else was doing what. And, oh, that province is declared a state of emergency, but has the city and all that kind of stuff. So let’s hope we all come through this with a higher degree of literacy about what we rely on our municipal governments to do. So let’s let’s continue then on the conversation about what are you gonna do about the cash crunch you’re in right now?

Mary Rowe [00:28:40] It sounds like you’ve got some options. And then let’s talk about what are the long term solutions. So right now, the options would be opening up your your reserves. And Noreen, that’s what you’re doing, right? You’re spending under your capital. What else? What are the other possibilities that you’re looking at to deal with the short term cash crunch?

Noreen Kassam [00:28:59] Right now, we’re just seeing.

Mary Rowe [00:29:01] FCM Proposal. Sorry, the FCM proposal. Go ahead. Go ahead. And you’ve got more. And then let’s hear from Mary and Kelly. Go ahead.

Noreen Kassam [00:29:07] No, I was just going to say, I mean, we are we are looking at potential opening up of facilities. When to do that. How did you that to start sort of getting some revenue back? We are encouraging those who can pay their property taxes on time to pay them on time, even though there will be penalties until later.

Noreen Kassam [00:29:23] You know, we aren’t we are lobbying the provincial and federal governments to apply for, you know, COVID-19, now operating grants for our potential infrastructure grants to to help us build the facilities that we were going to build from reserves. But we’re gonna need help on now. So there there’s a few different things that are happening.

Mary Rowe [00:29:44] Anything else? Mary, go ahead.

Mary Persson [00:29:45] So all of those that what Naureen said applies to Edmonton, there’s a couple of things around the lobbying is fine. We’ve actually proposed to our council. We presented it. We’re doing expense reductions first. Then we would go to a move to capital. We do have a fiscal stabilization reserve that we do have that we could draw from. We’re just worried about drawing from that now because we don’t know how long this is going to happen or how long this could be in place. And then then then we are looking at lobbying. We’re not lobbying. We’re never gonna lobby for deficit financing, but we are starting to look at aligning some pieces. Now, that’s from a budget perspective, from a cash flow perspective, because cash is king. What you have in your bank account? We have been lobbying the government and relatively successful at changing our payment days to them on their like we collect taxes on their behalf in Alberta as well as to when we will pay them some of.

Mary Rowe [00:30:36] The obligation, the obligation to send property tax revenues back up to the province.

Mary Persson [00:30:40] Yeah, back up to the province. So. So from a cash flow perspective, that just totally does not help me with my budget, but it does help me with my cash flow. So we’ve been having those conversations. We bluntly yesterday got approval to extend our lines of credit and our promise renewal programs, which is again, not ideal. But when you’re talking about balancing that as compared to cutting essential services, now that you’re here within a rock and a hard place. So there’s a few things that we put in place and we’re asking for some changes in cash flows and those programs, those capital programs that are funded federally, provincially and locally if we can move some of those cash flows around from. Because bluntly, I don’t know what the rest of the country is like, but Alberta put out an order in council to borrow twenty five billion dollars last week, and that’s for the province alone. So I do recognise and I do come from other orders of government. I do recognise the pressure that is on the province and the federal government as well. So I actually would like an an aligned practise on getting the economy back up and running. And so I do think municipalities have to play their role.

Mary Rowe [00:31:48] I mean, nobody has a blank check. I guess there’s just nobody completely on on any bank account. Kelly, any thoughts for you in terms of the liquidity, the actual cash crunch you’re in now?

Kelly Pelczy [00:31:59] Well, I can I can speak specifically from London’s perspective. We were in a a a pretty sound financial position going into this. So we’ve we’ve been able to cover the lost revenue through to the end of May with reserves. Again, that’s not sound financial planning. Obviously, we’re borrowing on on those reserves that we had in place to protect ourselves against situations like this. But eventually you would like to see those those reserves replace. So that is a short term, you know, a short term solution. Speaking more broadly, though, from a from a transit perspective, really, at the end of the day, if there if there is no influx of funding, whether whether it’s a short term bailout from the federal government or whether it’s a longer term, looking at enhancements with the way provinces contribute to the way transit is funded, you know, I honestly don’t believe that municipalities are going to be able to to fund transit in the way it’s going to need to operate going forward. And different funding models are going to have to be arrived at or unfortunately, we’re going to see service reductions. And that really scares me. I was around and I was lucky enough or old enough to be around in the 90s to watch transit systems have to try to come back after the significant cuts that happened as a result of budget constraints at both the federal and provincial levels as well as municipal at that time. And I mean, we saw the economy come back in in a two to three year kind of turnaround. And I can tell you, it took transit systems in excess of 10 years to get back to the ridership levels they were at prior to those cuts. What we know is when we reduce service, we lose riders. And when we lose riders, we lose revenue. And then we reduce service further. And that’s a downward spiral that’s very, very difficult to come out of. And I will say the transit industry all knows this very well and we’re all already on it. The scary thing is we don’t have any answers.

Mary Rowe [00:33:55] You know, you wonder whether transit you know, and I would add the transit is dependent on transit for a healthy economy because people need to get to work and goods need to move and all that kind of stuff.

Mary Rowe [00:34:03] But are we going to see a similar kind of questioning of whether or not transit is actually necessary? Because maybe we don’t have to travel as much to get to a job because we’re going to somehow magically the jobs are going to come out to us or something? No, it’s a larger question. Enid I want to go to you and just ask specifically what you be hearing, but what you’re observing in terms of addressing this current cash crunch. And then let’s then move to, OK, what’s the future look like? But just the cash crunch right now. What do you think the solution is?

Enid Slack [00:34:32] Well, the cash crunch right now. Municipalities are dealing with it.

Enid Slack [00:34:37] You’ve heard the way they’re dealing with it. They are cutting back on some of the expenditures they’re borrowing from their reserves.

Enid Slack [00:34:47] And that will get them through for a while. You know, it depends on how long this lasts and how long the recovery is going to take.

Enid Slack [00:34:56] You know, Toronto estimates this will cost them 1.5 billion dollars with a billion dollars with a shorter timeframe and a shorter recovery.

Enid Slack [00:35:07] That is that time frame gets longer and recovery period gets longer. Them up to 2.7 billion. So that’s a that’s a big difference, isn’t it? It depends on how long it lasts? By and large, pretty good fiscal managers in this country.

Enid Slack [00:35:22] They keep their taxes at a reasonable level. They keep their expenditures at a reasonable level. They’re not allowed to borrow for operating for very long periods of time. So this they started out in many cases in good fiscal positions. This is a hit that nobody ever expected it to happen.

Enid Slack [00:35:40] And so, you know, the manage for a while and then at some point, you know, they won’t be able to.

Enid Slack [00:35:47] And the other thing that bothers me is the long term consequences of the way they’re managing. Because whenever you’re cutting services, you know, whether it be transit or something else, there’s long term implications of that. And if you’re taking money out of their capital reserves, how are you going to build that needed infrastructure? We talk so much in Canada about the municipal infrastructure deficit. It’s huge. And if we’re not even keeping up the little bit that we would do. What does that mean for the future? And what does it mean for the recovery? Because I have to think that the recovery is partly going to be based on investment in the structure. Where is that money going to come from?

Mary Rowe [00:36:26] What are you thinking? That you’re asking the question to what do you where do you think where does the money come from?

Enid Slack [00:36:30] Well, I think I think, you know, if we’re turning to the recovery and we’re talking about infrastructure, the Federal government and the provincial government are going to have people that have structural programs.

Enid Slack [00:36:43] And I think that certainly will be a role for the federal government there.

Mary Rowe [00:36:48] So I guess that’s a question that I would have for the group of you if you’re depleting, if you’re dipping into your capital reserves, if but if the regulations are passed to try not to do that. And so you backfill off capital. I’m not I’m not an economist, so I’ll ask it in my dumb way. You take money from your capital, you put it into your operating, and then that leaves a big hole in your capital. We know that infrastructure and capital capital is needed to build infrastructure in order to create jobs. And it also creates the kind of we have lots of infrastructure that’s aging. We’ve got to fix it. So who who back fills that money? Do we just keep borrowing and who does the borrowing, I guess? That’s a question because you guys are limited in terms of how much borrowing. Where do we see that money coming from that investment? Where is it going to come from? Where I’ve heard you talking about lobbying your provincial governments. But what else what else are you thinking?

Noreen Kassam [00:37:36] It’s just again, delaying projects further utilising them. We’ve longer than their useful lives.

Noreen Kassam [00:37:44] And it’s just going to be, you know, have to be utilised in the way and shape it is for longer when it comes to either. ..

Mary Rowe [00:37:54] Which you could say there are risks associated with that.

Noreen Kassam [00:37:56] Right. Absolutely.

Mary Rowe [00:37:57] Because meeting bridges will fall down. Right?

Noreen Kassam [00:37:59] Well, you kind of your maintenance costs have to go up in order to be able to sustain something to stay longer. But the thing is, is that eventually I mean, like I said, unless we come up with new revenue sources, we’re gonna have to make sure that, you know, we we keep tax rates to a reasonable rate, but eventually we’ll need the money because a majority of our revenues come from tax taxes. You know, eventually it’ll have to be cut from taxes and tax rate increases, which is something we don’t want to do. And we’ll try to sustain it and therefore defer and delay projects. But, you know, in the end, pretty much that’s where the money comes from.

Mary Rowe [00:38:34] So let’s talk about that guy, since it’s the big bad word. But what about tax increases? I know that the FCM’s piece is asked. Other studies are estimating that if you actually had to do a correction, you’ve deferred all the you’re you’re off. You’re telling me I can defer my property tax if you eventually come calling and say, I want you to make good on that deferral. You’re talking about a big hefty increase in property taxes, which local politicians seem to be allergic to.

Mary Persson [00:38:58] There’s no appetite for a tax increase in at least where I’m working. And so it is a matter of trying to lobby and leverage other orders of government. I’m going to answer the capital project. There have been a lot of programs in the past that are federal, provincial, municipal matches. The challenge will be in this current time is to do the municipal match. So trying to figure out how you preserve that capital envelope to be able to do that. But I actually do think it’s going to become if there is no appetite for some of this, there’d be. I actually think it could be a a conversation aAnyway, I think this is a crisis that could become an opportunity to have really honest discussions with with counsellors about service levels. And so we’ve got a program here in it. We’re in the response phase right now. We keep on telling counsel that, but we do tell it three more phases that we’re going to be relaunching. That’s when you like. We’ve had to close playgrounds, when you reopen the playgrounds, those types of things, and you like the recovery, the relaunch and then reimagining, reimagining your city.

Mary Persson [00:39:59] What do you want it? What are the service levels you want? And it might be reimagined within a tighter fiscal construct.

Mary Rowe [00:40:07] What about I mean, what about the old uploading, downloading debated on you guys? Yeah. I want to take it over. Go in it.

Enid Slack [00:40:15] Well, I think what you know, what a crisis does sometimes highlights the problems with the system we’re living in. And we at our Institute on Municipal Finance and Governance last fall did a piece on clarifying responsibilities between provincial and municipal government, governments and others doing that. Who does what exercise again? Because, you know, should we as municipalities be responsible for funding public health, social services, emergency services. What’s the role of the province? What’s the role of municipality?

Enid Slack [00:40:49] And, you know, we do this every 10 to 15 years. We think about these issues. But I think it’s time again and it time before the COVID crisis.

Enid Slack [00:40:57] But I think it’s particularly time now to sort of say what what what’s the responsibilities and what’s what are the revenues for each?

Mary Rowe [00:41:05] What would you get them out of? What would you have said get out of?

Enid Slack [00:41:08] Well, I you know, in our report, we didn’t go into that.

Enid Slack [00:41:12] We talked about the principles to follow. And one of the principles is that the funding matched the responsibilities. So if you’re going to have social services fund to the municipal level, you don’t see that on the property taxes. That’s a redistributive service. The property tax is not the best way to do that and the income tax would be better. So those are the kinds of things you have to.

Mary Rowe [00:41:33] Enid, when you say know when you say income tax, you’re talking about subsidiarity that we want to be able to have service delivered at the closest level. When you say that it should be a service like social services should come off the income tax. Are you suggesting then that municipalities would be given the opportunity to levy an income tax or a shared ?

Enid Slack [00:41:50] That’s one possibility, not levy their own income tax. Of course, that would be administratively very expensive.

Mary Rowe [00:41:57] But a share.

Enid Slack [00:42:00] Yes, a share.

Enid Slack [00:42:01] A shares to pay for those social services, because that’s a better match than a property tax to pay for social services. But I think I think it has to be a collaborative approach.

Enid Slack [00:42:13] And you know what? One of the great things about this crisis was the collaboration we’re seeing among these three orders of government, federal, provincial and municipal. What a great opportunity to build on that that decides who does what and what is the right word.

Mary Rowe [00:42:28] Yeah, people people on the ground are asking for us to post its report. We’ll do that. It was issued this fall. I’m I’m just going to encourage people who are on the chat to direct all your comments to all panellists and everyone, not just it’s all panellists and attendees. We can probably switch. You can.

Mary Rowe [00:42:43] You can do it when you post your comments. Anybody see that? What about other other sources of capital? What about big, bad private capital? Is there an opportunity now to have a difference? Is create some different kinds of tools to get private capital into the municipal finance world.

Mary Persson [00:43:07] Nor do I think I’m thinking about it because we actually have some private capital and done some P3 initiatives. So on the on some of the bigger ones and perhaps on some of the waste projects and the greening projects, you could you could do that. And we are exploring that. The challenge is doing those during a crisis highlight some of the risks that could come with that. But again, risk opportunity. So I’m not saying no at all. It’s it’s just I am maybe a traditionalist.

Mary Rowe [00:43:38] I don’t know what I can tell you that on the Chatbox, there’s a whole bunch of people blowing up about this saying, oh, my God, we’re going to privatise everything.

Mary Rowe [00:43:43] But but is there just you know, when you look at where is there going to be liquidity? So maybe is it. Is it in pension funds? I don’t know. Is it? We can’t just keep looking to the federal government to print more money. I’m just assuming that we have to start thinking, are there other calculus as we need to draw on your own? You’re nodding. What do you think of you thinking about other forms of it?

Noreen Kassam [00:44:02] As you mentioned, I’m sure we’re going to have to think out of the box. We’re going to have to think of potentially other ways of bringing revenue into the municipality. Because even though property tax is a major source, it is definitely low on the priority list of increasing. As as Mary said, they really want to try to keep it as low as possible. So what are some other ways we’re going to have to rethink that and think out of the box as to what are some other opportunities? Whether that’s partnering with the private sector or within, among other things, governments with PPPs or whether it’s through just other revenue opportunities and lines of business. I mean, we want to stick to our core business in delivering our services well. But there are other opportunities that potentially we can expand or services. As Enid said, this is the time to to look at potential other opportunities.

Mary Rowe [00:44:51] Well, I guess it’s a challenge for Canadians about how do we want to invest know, you know, that Oliver Wendell Holmes, quote, I I’m I’m happy to pay my taxes if I see civilization.

Mary Rowe [00:45:00] I guess the question is, where do I want to pay those taxes? Where can I see the greatest accountability? And we’re getting lots of the folks from the Canadian Urban Transit Association on the chat function here. And I see Andy Manahan is there and Kathleen … And a number of folks asking questions, Kelly, that are of interest to you. Ah, do you think we run the risk that transit systems will there’ll be more pressure to privatise. Those are real. Move more to private modes. How do we actually can we actually lay the groundwork here to keep public transit public? Are you thinking about the big questions over there? You business in London?

Kelly Pelczy [00:45:33] Certainly. You know, again, we’re we’re we’re looking at everything. The I mean, privatized comes up all the time. I think the thing you have to remember with transit, although historically we have had very good cost recovery, transit doesn’t make money that privatizing is private sector.

Kelly Pelczy [00:45:52] It gets in business to make money. So some people want it.

Kelly Pelczy [00:45:55] Well, what will happen is they’ll they’ll want the roads that are productive so they’ll run routes that, you know, you see very high ridership on and they’ll want to leave the rest of it to to someone else. So what you’re going to have happen if you go down that road, there’s a very strong potential. What you’re going to have happen is a very reduced transit system that’s going to be operating at great frequencies on a couple of core corridors within a municipality. But you’re not going to have those services into subdivisions. It’s going to result in a system that doesn’t work for people. But it will work on those on those very key corridors. But but that’s not a transit system. That’s you know, that’s just high frequency service on a on a couple of corridors.

Mary Rowe [00:46:39] I want to go back to its question about who does what and what do we get out of anybody thinking about other things that you could that municipalities could get out of that are so that they either get reassessed and the province takes them or that you actually stop providing a particular kind of services or anything else. What about all those parking lots, municipalities own and stuff like that? I don’t know. Is anybody going to think about. I don’t know. Leveraging them? What about some of your assets that actually are stranded? And I don’t have any proactivity. Anybody thinking about how you could monetize those new kinds of ways?

Mary Rowe [00:47:12] Or not?

Mary Persson [00:47:15] Those are two questions, what should we get? I was thinking, well, because I think what we get out of typically what we provide is a civil service. So it would be. Are you going to upload them again to the province? What this is highlighted, just for an example for Edmonton, is the clarity around the service for it, for the vulnerable populations. You know, the. And so we actually need to engage more directly with our province again, with what we have always been trying. But this is really, really brought to the fore. The challenges with downloading of some services and not of others, the property tax, not the base. But you don’t want to leave the people stranded. It just means more conversations have to come on. As with respect to the property. I don’t think we’re there yet. It’s not off the table about looking.

Mary Rowe [00:48:03] You just you know, the dilemma, too, is let’s take another example of where pre-COVID and municipalities were struggling. You know, you don’t have enough housing. Every every every community in Canada seems to have a shortage of housing. And then here you are. You’re not in the housing business. You got thrust into it. And this is an area where I was pushed back on Enid, because I think only if you abdicate that. If you say, well, housing is not us, then no housing gets built. So how would tell me what you’re thinking about how you’re going to actually finance housing? That’s where the private sector could presumably be helpful. Right. Thoughts on this? There are areas that I’d be sorry to see municipalities back away from just because they can’t with the current system pay for it.

Noreen Kassam [00:48:45] If I can add up, affordable housing has been priority for the last couple of years, if not longer. And that has to continue.

Noreen Kassam [00:48:54] You know, when and if it means working closely with private developers. I mean, we have a program for density bonus saying, you know, if developers want to build higher rises, they’ll have to pay a little bit more. But we also allow have a tendency policy where, you know, you have to be able to rent to a certain number within the within the buildings and so forth. And so those policies are now set policies that will continue to ensure that there will be sufficient and affordable housing in place in the years to come.

Noreen Kassam [00:49:21] And I think that we need to keep those at the forefront and not lose sight of those.

Mary Rowe [00:49:24] And are there may be new financial tools. I mean, we have this as as was being suggested by Enid is a time now for a renewed new conversation.

Mary Rowe [00:49:33] You have in a moment now where you’re going to be able to highlight for the public, look at all the services that we provide and areas where we want to be able to provide more service and we need a new revenue tool to do it. So let’s talk about some of the big bad revenue tools that people are thinking about tolls. What do you think? Congestion pricing?

Enid Slack [00:49:52] I think tools were a good idea. I think not only did they bring in revenues, they change people’s behaviour. Changing people’s behaviour is very important because they want to get people out of their cars onto transit or walking, or on bikes. And the tolls were a very good idea. They were good idea before they remain a good idea now.

Mary Rowe [00:50:15] I wonder I wonder, you know, in Ontario, the the provincial government turned down the option for tolls. But I’m wondering if if the option of a provincial government is where you can go into a bigger deficit and and put money into cities or you can actually let them create their own tools. What other people think about other kinds of user fees or other revenue tools? Is anybody else thinking about the problem with the gas tax, of course, is it’s a diminishing revenue source. Right. And people will people be using the cars? I don’t know. Anybody else think. Mary? Kelly? Noreen? Anything else?

Noreen Kassam [00:50:50] User fees are a bit of a tough one in that you want to remain competitive, too, and you’re all trying to offer services to the citizens that they are expecting can be offered through the payment of their property taxes. So, you know, it’s a fine balance. But, you know, we do look at our user fees and we do look at you pay for the service that you use.

Noreen Kassam [00:51:10] But there’s one there’s a balance you have to find within that, too. So it becomes a bit of a difficult conversation, but it’s definitely one to be had to ensure that, you know, are people expected to pay through their property taxes for certain service where people to pay based on youth activity?

Mary Rowe [00:51:26] There’s this, as you say, user fees. What about investment vehicles? What about municipal bonds? Anybody thinking about that? Does that appeal appeal to you Enid? A municipal bond?

Enid Slack [00:51:36] Well, municipalities borrow now. So, I mean, the thing is, the tax free bonds like they have in the US.

Enid Slack [00:51:44] I’m not a big fan of the tax free bonds. They’re pretty regressive. They help high income people more than low income people for sure. When municipalities borrow for capital now…

Mary Rowe [00:51:56] Is there any. But there’s no mechanism for me, a person at a certain stage of life with a certain amount of savings to actually invest in my city, correct? Do I have a vehicle to do that now?

Mary Rowe [00:52:10] Like a consumer,.

Enid Slack [00:52:11] There’s no such thing as a city of Toronto bond. No.

Mary Rowe [00:52:15] And it just what Noreen saying is a bit of a different perception between, gee, you’re taxing me more too. I’m giving here’s an option for people to invest, surely. And I’m just wondering about private capital markets. Is there not a belief that cities will rebound and they will continue? That you can make a safe investment in the future of a city?

Mary Rowe [00:52:35] No, no appetite for that.

Mary Persson [00:52:38] Well, OK. In Edmonton, I actually will give our province kudos for setting up. We actually have a very effective borrowing program with the province. And so we get exceptionally good rates so bluntly. Well, that may be appealing from an aesthetic perspective.

Mary Persson [00:52:53] It might actually cost the city more. So I’m not necessarily interested in the bond. I’d have to explore it more. To be fair. But when you talk about the the one thing I’m worried about, COVID is one thing but we were heading with the oil prices and this will affect all of Canada. The oil prices are a looming issue for us as well. So when we talk about any user fees, any increase in taxes, I get a bit worried about the ability for citizens to bear that. And so if you’re not demonstrating that we are being as competitive and as reasonable on the expenditure side and what we’re choosing to spend taxpayers money on, I I we’ve got to be really good at that that narrative in order to actually demand for more revenue to deliver the services we get. I want to circle back. It is a question, though, if we are going to get affordable housing, number one priority for this city as well as.

Mary Rowe [00:53:48] By demand more revenue, from whom would you be demanding?

Mary Persson [00:53:51] Well, from the users through user fees, tolls, drivers. And like I’m talking any anyone or you’re getting me probably a little bit coming from the fact on what will our citizens be able to bear given the fact we know that not only do we have COVID, but we have an energy crisis currently right now that we have to rebound from, which may be the epicentre in Alberta, but will certainly affect the rest of Canada, because all the economic factors we’ve been looking at are our professional services cannot rebound if our energy sector does not rebound, our health services will have trouble if our energy sector does not rebound. And so it’s just. I’m I guess I’m just trying to balance the desire for us to have the revenue to deliver with our citizens ability to pay irrespective of place.

Noreen Kassam [00:54:37] Mary, could I just go back to your comment about our bonds and borrowing to has to borrow through them.

Noreen Kassam [00:54:45] Municipal Finance Authority to the provincial government. We have been lobbying departments over the last year and a half now, one on opening up our standards to prudent investor standards, allowing us to invest in more other types of securities that are not just fixed income securities to allow for a little bit more risk, more reward, you know, type thing. From that perspective, you know, interest in earnings. And you think it’s really important that, you know, if the provincial government for us now can look at that a bit more than that will give us more opportunity to make more for our citizens. And then again, keep the property tax rates.

Mary Persson [00:55:20] And we’ve been very fortunate to have those conversations on bullying with our province for a long time. So so it’s been it’s been good.

Mary Rowe [00:55:27] I mean, the provinces are critical here, aren’t they? Because, of course, we all remember you are only creatures of your province. So you can only wiggle so much within the current constitutional framework. Right. And as soon as we’re hearing on the chat function, people are identifying user fees are not progressive. And the dilemma you’ve had is that cities haven’t had access. Municipalities haven’t had access to progressive forms of taxation. So as the as things grow, you don’t benefit from that. So I guess that’s a question. Is there are there in it?

Mary Rowe [00:55:56] Enid, are there is this a tweaking situation? Are we are into tweaking or do we need some more significant kind of change?

Enid Slack [00:56:05] I think I think we need more significant changes. I think we really have to go back to what business for municipalities is and what kinds of revenues do they need to pay for the services that they deliver. And it’s going to be a combination. It’s not going to mean one thing or another with property taxes or a very good tax for local governments. You know, property doesn’t move. So you’ve always thought the tax there.

Mary Rowe [00:56:31] And do you want to differentiate between commercial and residential property tax?

Enid Slack [00:56:35] Well, there is a difference between commercial and residential in a lot of ways. Residential tax payers use more services than business properties. So you think they would maybe be levied more taxes? What, they actually pay a lower tax rate in most jurisdictions and business properties. Business properties are more responsive to tax changes. They’re more likely to move than a residential property. So there are some differences between residential non-residential. I would argue the residential probably tax is a good tax for local government. The non residential property tax is not as good. But there’s a strong role for user fees.

Enid Slack [00:57:15] And I hear your viewers comments about regressivity user fees. Tell us what people want.

Enid Slack [00:57:22] You know, if we don’t charge user fee for water for people, we’re going to take lots of showers, wash their cars, water their lawns. You know, we have a charge to say, what are you willing to pay for this? And then people will use the amount of service supported by user fees are an important part of this picture and have to be there. Department taxes, user fees. You know, there’s a role for provincial transfers for sure with were services spill over municipal boundaries.There’s a role for provinces to come in and play for some as well. So it’s a it’s a big you know, it’s a big group of tools that municipalities need.

Enid Slack [00:58:02] And I think we have to think through what they’re providing and what’s the appropriate way to pay for those things.

Mary Rowe [00:58:09] And so how did we align those? Right. How did this align?

Enid Slack [00:58:13] I have papers I’ve written and it’s a continuum. You know, you’ve got things that are very public in nature, very private in nature, spill over boundaries, redistributive, and they all require different tools.

Enid Slack [00:58:25] I think it’s time to rethink all of that.

Mary Rowe [00:58:28] So let’s go around and ask thirty seconds from the others. Enid’s Soundbite then is there’s a moment to rethink this, to rethink who does what. 30 seconds to each of you about what?

Mary Rowe [00:58:38] If you have one thing that you want to come out of COVID, that becomes the dominant learning that we need to do on municipal finance. What would it be? Let’s go to you first Noreen.

Noreen Kassam [00:58:46] You know, it’s really that we’ve learned to think on our feet and deal with the situation that we have never dealt with before. And yes, of course, we’re going to learn from this. We’re going to we’re going to build practices. But, you know, it just goes to show that you never know what’s going to come in and eat you from behind or from the side.

Noreen Kassam [00:59:03] You just have to be prepared at all times and make sure that you’re your eyes are wide open when you’re looking at everything that needs to be done. And when it comes to municipalities, again, you’re there for the taxpayers and the citizens need to ensure that they continue to receive what they need and what they’re paying their taxes.

Mary Rowe [00:59:18] What’s the one thing what’s the one thing that you think need people need to be focussed on? What’s the one question?

Noreen Kassam [00:59:24] Right now, I mean, everyone’s looking at recovery and how they’re going to be able to come out of this crisis and we just have to be there for supporting all their citizens to come out of this crisis.

Mary Rowe [00:59:33] Right. Kelly, one thing in terms of the financing of transit that you want to have people focus on coming out of this.

Kelly Pelczy [00:59:41] My hope is that municipalities, municipal councils and then the province and the federal government as well. Don’t lose sight on the significant impacts that an effective and efficient transit system have on a community in terms of, you know, the savings associated with having a good transit system in terms of the required road windings that are being deferred in those type of things, as well as the access to the community that the that the service provides. Often in times like these those things, we lose sight of those things and and that results in that downward spiral that I talked about earlier, which which unfortunately takes a long time to come back from. So I really hope that that we’re able as an industry to continue to emphasize the benefits the public transit brings to communities and we don’t lose sight of that one.

Mary Rowe [01:00:30] Yeah. Not let’s not go down that spiral again. Let’s stop the spiral. Okay. Mary, last word to you. 30 seconds from the beautiful city of Edmonton.

Mary Persson [01:00:38] OK. So mine would be what an important that the other orders of government understand what an important role cities have in an economic recovery and in delivering services. So redesign framework between the federal, provincial and municipal governments, cities, at least even the big six have about 20 percent of the GDP. You’re instrumental in recovery and so are realign financial framework between the three this audit. We are a creature of the province. Maybe that has to be relooked at because we are pretty significant. Sorry for those that don’t know. I’ve only joined the city in January, so I know.

Mary Rowe [01:01:16] OK, that’s good. We’re glad to have you. So no more creatures of the province. Let’s be the. You want to be a sibling of the province, not a creature. Enid, anything from you to top up this big picture we’ve just drawn on?

Enid Slack [01:01:30] No, I think this has been a great discussion, Mary.

Enid Slack [01:01:32] I think we’ve found out sort of what’s happening on the ground and will take it up to find out how we will go forward.

Enid Slack [01:01:39] How would you redesign the system to make it look better for every day and for future crises that might help?

Mary Rowe [01:01:47] Yep, absolutely. Wakeup call for how we finance studies. Thanks, everybody, for joining us on City Talk. Thanks to our for tax chicks coming from coast to coast, although we didn’t have Atlantic Canada, but tomorrow we do. The mayor of Halifax is joining me for a one on one. And when we were talking of when Mary was mentioning the oil crisis in Calgary and Edmonton, how that was affecting Alberta and their cities. We’re aware that while COVID descends on the world. We have other kinds of challenges that either pre-existed or have surfaced, and so will Calgary and Edmonton, very hard hit by the oil crisis. Fort Mac now really, really severely impacted. You’ve got flooding in other parts of the west. You’ve got fires coming back. Life just continues. The cycle of resilience challenges continues. And we will continue to try to cover it here in city talk. So please join us tomorrow, midday with the mayor of Halifax, because Nova Scotia had visited upon it a horrific tragedy to compound what they were already dealing with COVID. And so we’re going to hear about the recovery of Halifax and the region and tomorrow and all the things that that Michael Savage is coping with. So he will be tomorrow in city talk. And then next week we’ve got three more. So you’ll get an e-mail in your box telling you block that time. We look forward to having you midday Eastern and early in the morning in Pacific and in the middle, mid-day for people living on time and on Atlantic Time.

Mary Rowe [01:03:09] Afternoon tea. Looking forward to seeing you next week at the chat. Stays open a little bit if you want to say other things. We’ll post all this tomorrow. Thanks, gals. Really great to have you talking about this. Cities will cities will survive.

Kelly Pelczy [01:03:26] Thank you. Thank you.

Full Audience
Chatroom Transcript

Note to reader: Chat comments have been edited for ease of readability. The text has not been edited for spelling or grammar. For questions or concerns, please contact

12:30:38          From Sue Hallatt, CUI Staff  WELCOME! We will begin very shortly…

12:31:01          From Abigail Slater to All panelists  Hi mary

12:32:27          From Basana Dey to All panelists  Hi all, Basana from Toronto Public Library…

12:33:00          From Canadian Urban Institute  Folks, please change your chat settings to “all panelists and attendees” so everyone can see your comments. Enjoy the webinar!

12:34:43          From Andrew Payne to All panelists  ;/’

12:35:36          From Andre Darmanin  Hello all from Woodbridge, ON.

12:35:48          From Karey Steil  Hello! From Edmonton.

12:35:54          From Julie Dawley  Hi from Tillsonburg ON

12:35:54          From Krista Woltman to All panelists  Hi Bonjour from Ottawa!

12:35:56          From anthony dionigi to All panelists  hey from edmonton

12:36:03          From Andre Darmanin  My old stomping ground – YEG

12:36:03          From Darren Randell  Hello from St. John’s NL

12:36:05          From Jenna Grose to All panelists  Hello from Vancouver

12:36:06          From Tracey Allen  Hello from Prince Edward Island

12:36:15          From Ann Wong to All panelists  are we all muted?

12:36:29          From Suzanne Kavanagh  I love these chats, haven’t missed one yet from Picton ON

12:36:34          From Lisa Cavicchia, CUI Staff  yes everyone is muted

12:36:41          From Kirk Biggar to All panelists  Hello from Oakville, ON. We have been tuning in and getting a lot out of these conversations, thanks to all.

12:36:41          From Nancy Dube  Hello from Victoria BC

12:36:52          From Canadian Urban Institute  #citytalk

12:36:52          From Kathleen Llewellyn-Thomas to All panelists  Hello from Toronto – particularly TTC – (costing the City of Toronto $25M a week) 🙈

12:37:08          From Can Chen to All panelists  Hello from Miami, FL

12:37:09          From Almos Tassonyi  Hello All: Looking forward to your insights

12:37:25          From Emily Wall, CUI Staff  Today’s panel:

Noreen Kassam – https://www.burnaby.ca/Home.html

Kelly Paleczny – http://www.londontransit.ca

Mary Persson – https://www.edmonton.ca

Enid Slack – https://munkschool.utoronto.ca/imfg/

12:37:28          From Kirk Biggar  Hello from Oakville, ON. We have been tuning in and getting a lot out of these conversations, thanks to all.

12:37:34          From Daniella Dávila Aquije to All panelists  Hello from London, England!

12:37:34          From Brian Owen to All panelists  Twiiter can be more of an ‘alternate’ universe … LoL

12:37:48          From Arlene Etchen to All panelists  Hello from Aurora Ontario

12:37:50          From Lindsay Vanstone to All panelists  Hello from Edmonton!

12:37:52          From Coleson Proudfoot  Hello from Calgary AB! )

12:37:55          From Andre Darmanin  Yes I remember Kelly Paleczny from my CUTA days such a long time ago.

12:37:59          From Katie Geoghegan to All panelists  Hello from Vancouver BC. Thanks for hosting this!

12:38:09          From Katie Geoghegan  Hello from Vancouver BC. Thanks for hosting this!

12:38:18          From Madelaine Morrison  Hello from Ottawa, Ontario

12:38:34          From Cheeying Ho to All panelists  Hello from Whistler! 🙋🏽‍♀️

12:38:57          From Andre Darmanin  This is my first #citytalk. Looking forward to the discussion with a diverse panel.

12:39:25          From Augusto Mathias  Hello from Sao Paulo – Brazil

12:39:50          From Sam Weller  Greaating from Sam Weller of CAGFO in Victoria

12:40:57          From Sue Hallatt, CUI Staff  CAGFO: Canadian Association of Government Financial Officers?

12:41:40          From Allison Ashcroft  yes

12:42:58          From Andre Darmanin  We need to use “physical distancing” now.

12:43:12          From Prabha Khosla  Good Morning, from Burnaby, B.C

12:44:19          From Andrea Lam  It’s totally changed my commute, I now am riding my bike to work. It’s safer – fewer cars on the road than before, but it sure takes longer!

12:44:40          From Caryl Arundel  Good afternoon from rainy Toronto.

12:49:23          From Abigail Slater  How do we ensure that in the future, Cities do to sell valuable resources (real estate) to cover deficits…how do we prevent “vulture” capitalists from scooping up those assets? And what if libraries are on the chopping block because suddenly everyone goes digital?

12:49:35          From Abigail Slater  *do NOT sell

12:50:14          From Abigail Slater  But cities are VERY restricted in how to repay? They cannot issue bonds of any sort…

12:50:33          From Lorne Cutler to All panelists  Is BC considering doing away with universal deferral of property taxes by those over 55 and limiting it to only those below a certain income level such as the City of Ottawa does?

12:50:43          From Abigail Slater  They are creatures of the Province…the province needs to allow for other ways for municipalities to raise funds…

12:50:47          From Andre Darmanin  The glowing discrepancy with our current Constitution when it comes to the role and function of municipalities in Canada.

12:50:52          From Keshwer Patel to All panelists  question to Enid: what is your opinion of the appropriate mechanism to deal with the cash crunch? should it be deficits or debts that the local munis have to levy on their tax payers anyways or should it be with federal or provincial govt that have a bigger base.

12:51:05          From Andrea Lam  I’ve found that even with many services moving digitally, libraries are still needed – people need help to use those digital resources.

12:51:21          From Abigail Slater  @Andrea…i totally agree…it’s a worry, not a recommendation…

12:52:03          From Abigail Slater  Isn’t is amazing how quickly Toronto is building modular housing?

12:52:15          From Abigail Slater  for the homeless….

12:53:00          From Jesse Helmer  Greetings from London! During the 2007-2008 financial crisis, property tax arrears in many municipalities were elevated for 5-6 years. What does the panel think the impact on property tax revenue will be over the next 2-3 years?

12:53:11          From Andre Darmanin  Hey @jesse

12:53:30          From Almos Tassonyi  Generally, the borrowing rules are very similar across the country- interim borrowing is a short term cash flow management technique but may buy time for the other levels of government to get their act together- otherwise borrowing by other means is for capital projects

12:53:45          From Mohamed Dhanani to All panelists  Any specific ideas that Universities can do to help Cities in the recovery process

12:53:57          From Cheeying Ho to All panelists  @enid – are Provinces looking at allowing local governments additional taxation/revenue powers?

12:54:17          From Andy Manahan to All panelists  What role do you want Ottawa to have in assisting with municipal infrastructure projects?

12:55:07          From Andrea Lam  @Abigail I know friends in different parts of the country who are facing cuts even before COVID and this has made things interesting.

12:55:11          From Almos Tassonyi  It is likely that arrears will be elevated for several years- provinces should review the rules on cancellation and arrears and uncollectable taxes

12:55:18          From Canadian Urban Institute  Welcome new joiners! Just to remind you to please change your chat settings to “all panelists and attendees” so everyone can see your comments. Thanks!

12:55:54          From Allison Ashcroft  @jesse FCM’s recent report page 5 shows that f this loss in revs and increased costs continued for 6mths and needed to be recouped entirely from local taxpayers, it would require a 56% increase in property taxes for residents, van 22% Calgary 23% montreal 18% etc etc https://data.fcm.ca/documents/resources/reports/protecting-vital-municipal-services.pdf

12:56:09          From Henrik Bechmann  Toronto’s operating budget includes at least $1.5B which goes to capital (water works and “Capital from Current”). This could be in principle replaced by debt, freeing it up for operating costs.

12:56:35          From Cheeying Ho  @enid – are Provinces looking at allowing local governments additional taxation/revenue powers?

12:57:23          From Andre Darmanin  I like the point about the need to look at cuts from resilience and equity lens. There needs to be a holistic, silo breaking decision making process.

12:57:46          From Jesse Helmer  If one of the longer term impacts on commercial property (esp office buildings) is that the value of those properties declines relative to other property classes, what kind of shifts of in the distribution of the property tax burden might we expect *from* the commercial classes *to* the residential and multi-residential classes once CVA resumes (it’s paused for now in Ontario)?

12:58:46          From Lindsay Vanstone to All panelists  The buses between shelters in Edmonton look to be really well used. Great thing to do!

12:59:05          From Lester Brown  Toronto is actually considering reevaluating its “hybrid” Gardiner Expressway and just doing State of Good Repair work on the Gardiner. At least the Mayor has mused about this.

12:59:56          From Andy Manahan  Will asset management plans be used to set priorities and then apply for senior level govt funding?

12:59:59          From Allison Ashcroft  in BC for 2008/2009 the province expanded its long term prop tax deferment program for households experiencing financial hardship. This time around, would need to expand to business taxpayers too but the mechanism exists to do this. Note that if provinces do extend and expand these long term deferment programs, then prov or federal govt will still need to provide muni portion of prop taxes to cities because it comprises 90+% of their revenues in most instances. User fees might look big, but when it comes to transit for instance, these are still subsidiszed services, fare box revenues are often 50% of total cost to provide that service.

13:00:52          From Emily Wall, CUI Staff  Please help CUI improve its CityTalk programming with a short post-webinar survey – https://bit.ly/2SobL5g

13:01:28          From Alan McNair  Here is a vote for cleaner better municipal transit services which are not funded from the fare box but from provincial and federal tax resources. This could reduce capital road expansion costs which in turn would help municipal finances in the long term.

13:01:34          From Andre Darmanin  @lester It makes you wonder…re: Gardiner East

13:01:38          From Almos Tassonyi  Shifts in relative tax burden will happen independently of the postponement of the reassessment in Ontario

13:02:22          From Margaret Prophet to All panelists  @lester – maybe they should just reconsider building it or repairing it at all.

13:03:08          From Abigail Slater  But if Covid is not a reason to use reserves what is?

13:04:18          From Leslie Kelman to All panelists  Around the turn of the century we had Y2K, 9/11, power outage, SARS, and as a result we were all into Contingency Planning. Were our plans still valid in 2020 or had they fallen out of date?

13:04:52          From Allison Ashcroft  For kelly, what amount does fare box currently cover in terms of transit budget? and is this time with COVID an opportujnity to move towards fare free transit, or at least fare free for income-qualified individuals? Great point on the knowck-on effects re ridership, fares, connectivity/route scheduling, etc. it is a downward spiral. same with building out bike lanes

13:05:11          From Nadia Todorova to All panelists  Hi all, great conversation! Regarding prudent transit investment, please see a recent report by RCCAO on this topic: https://rccao.com/research/files/RCCAO-STATION-TO-STATION-REPORT-APRIL2020.pdf

13:05:34          From Emily Wall, CUI Staff  Just a reminder to please change your chat settings to “all panelists and attendees” so everyone can see your comments.

13:05:58          From Lenore Swystun to All panelists  I am on two webinars at once. A question wrestling with – re land use policy and regs – is what might we need to do on a planning front differently in post covid times – in terms of how to prioritize developments (and pressures within various sectors) to re-open.

13:06:18          From Sean Lee  Interesting question – Edmonton’s made transit free for the duration, but it’s created a number of problems.

13:06:22          From Helen Lee  Curious to know whether other Mayors and Councils and management are cutting their salaries or taking furloughs as with the City of Vancouver? Also, why haven’t we heard any talk about transit authority CEOs and management (who usually have high salaries, bonuses etc) take pay cuts to alleviate their deficits.

13:06:29          From Margaret Prophet  @lester – maybe they should just reconsider building it or repairing it at all.

13:06:32          From Kathleen Llewellyn-Thomas to All panelists  Toronto funds 67% of our annual $2B Operating budget from Fares. Highest fare box recovery rate in North America.

13:06:46          From Andre Darmanin  @Allison No Fare-free transit is not the answer. Operations and maintenance are significant costs that you need to find revenues to balance the books, aside from subsidies.

13:07:33          From Karey Steil  @fare free transit: transit also helps with safety.

13:07:37          From Kathleen Llewellyn-Thomas to All panelists  So TTC not typical. But impact of 80% loss has made transit the single largest pressure on Toronto’s COVID operating budget.

13:07:42          From Andre Darmanin  fare-free transit are for small towns or tourist towns, not for mid-size and large munis

13:07:55          From Emily Wall, CUI Staff  Please help CUI improve its CityTalk programming with a short post-webinar survey – https://bit.ly/2SobL5g

13:07:58          From Kathleen Llewellyn-Thomas to All panelists  @andre Agreed

13:08:28          From Allison Ashcroft  the reserves are not general rainy day funds, they are for capital and equipment and infrastructure renewal. municipalities build and maintain 60 percent of the core public infrastructure that supports our economy and quality of life.The 2019 Canadian Infrastructure Report Card—produced by FCM and seven partner organizations—examines the state of Canada’s public infrastructure. Among the key findings:

Nearly 40 percent of roads and bridges are in fair, poor or very poor condition, with roughly 80 percent being more than 20 years old.

Between 30 and 35 percent of recreational and cultural facilities are in fair, poor or very poor condition. In some categories (such as pools, libraries and community centres), more than 60 percent are at least 20 years old.

30 percent of water infrastructure (such as watermains and sewers) are in fair, poor or very poor condition.

13:08:57          From Colleen Kaiser  How might private capital investments be leveraged for municipal infrastructure?

13:09:08          From Chris Terech to All panelists  Transit is an obvious revenue loss,. Do the panelists feel that water and waste water fees from commercial enterprises wouild also be a significant revenue loss from businesses that go bankrupt?

13:09:18          From Sam Weller  Loans from the Feds to solve cash flow will not really help.

13:09:36          From Abigail Slater  Using the private sector is what is frightening…the privatization of city services

13:09:53          From Almos Tassonyi  The distribution of the current Gas Tax fund from the federal government is based on asset management plans

13:10:10          From Abigail Slater  Maybe there are PPP (Public/private partnerships) that could create more equitable sharing of returns…

13:10:12          From Margaret Prophet  Agree @abigail re: privatization

13:10:16          From Beate Bowron  we have experience with selling off municipally owned properties in times of budget shortfalls. Let’s not do this again; instead this should be an opportunity for a radical re-think of governmental taxing powers.

13:10:25          From Andre Darmanin  @abigail COVID has provided for plenty of eye-opening revelations. Service gaps, housing crisis, wage gaps, etc.

13:10:25          From Ann Wong to All panelists  Hello from Mississauga. Can municipalities get a piece of the income tax revenues?

13:10:28          From Abigail Slater  @Beate…HUGE risk!

13:10:45          From Nadia Todorova  Hi all, great conversation! Regarding prudent transit investment, please see a recent report by RCCAO on this topic: https://rccao.com/research/files/RCCAO-STATION-TO-STATION-REPORT-APRIL2020.pdf

13:11:14          From Kathleen Llewellyn-Thomas to All panelists  thanks Nadia. Good insights.

13:11:21          From Helen Cooper to All panelists  are we back to the age old debate of which order of government does what; I.e. social services and income distribution programs be funded through income tax?

13:11:36          From Andre Darmanin  @Nadia There was another recent report I was thinking of that could be relevant to this discussion.

13:12:28          From Nadia Todorova  @Andre, thanks!

13:12:33          From Margaret Prophet  Where can we get the report that Enid is referring to? Link?

13:12:52          From Canadian Urban Institute  The chat activity is great! Keep an eye on your settings and make sure we are all including attendees. We’ll keep the chat open after the webinar ends, too.

13:13:24          From Andy Manahan  Gas tax revenues will be dismally low. Ottawa and the provinces should have been increasing these tax rates on an inflation-adjusted basis.

13:13:54          From Colleen Kaiser  @Andy – agreed!

13:14:44          From Almos Tassonyi  Municipalities have been at the mercy of zero zealotry for years

13:15:03          From Helen Cooper to All panelists  the private sector is not coming out of the COVID crisis very well when it comes to provision of LTC.

13:15:07          From Allison Ashcroft  this is the specific report Enid referenced which is focused on Ontraio but relevant/consistent to other provinces too https://munkschool.utoronto.ca/imfg/research/doc/?doc_id=525

13:15:16          From Andre Darmanin  Gas tax has been a dwindling source for a long time. Time to take road tolling or cordon pricing seriously, as an example.

13:15:20          From Hilary Carlson to All panelists  what about looking to new revenue stream like from PACE FInancing Programming or other climate friendly initiatives>

13:16:03          From Allison Ashcroft  the featured research box on IMFG home page also has other great research reports re property tax https://munkschool.utoronto.ca/imfg/

13:16:49          From Margaret Prophet  More inequity

13:17:03          From Lester Brown  We are hogtied by the Provincial government. Toronto has suggested using various revenue tools and the Province has usually said No.

13:17:16          From Abigail Slater  @lester right….

13:17:19          From Allison Ashcroft  kelly youre awesome. exactly, cherrypicked transit system not focused on ubiquity, equity, and affordability

13:17:20          From Andre Darmanin  The tech bros are dying to get involved in the transit space.

13:17:27          From Scott Vokey  Private capital can be helpful to monetize current waste products at municipal level such as Biogas from wastewater and SSO.

13:17:42          From Almos Tassonyi  There are papers on the School of Public Policy, University of Calgary website that also review municipal finance issues

13:17:53          From Emily Wall, CUI Staff  Please help CUI improve its CityTalk programming with a short post-webinar survey – https://bit.ly/2SobL5g

13:18:01          From Andre Darmanin  @lester Agreed. Re:Gardiner and DVP

13:18:11          From Allison Ashcroft  cities are looking at parking lots for modular housing. that’s where Vancouver has been building those primarily

13:18:15          From Melinda Munro  Agree with Andre – Uber fantasizes about Transit but the ability to control access and keep it safe during this crisis are two main reasons for keeping it public. We have to remember is that transit isn’t a matter of money it isa matter of equity.

13:18:22          From Alan McNair  Major public and private pension funds could be encouraged to fund major infrastructure projects instead of private capital sell offs like Ontario’s Hwy. 407 and the PPP direction being pushed by the current Ontario government.

13:18:25          From Stephen Russo  will we see amalgamations, disincorporations, other restructuring?

13:18:26          From Melinda Munro  Are we going to privatize parks?

13:18:55          From Melinda Munro  Amalgamation of municipalities doesn’t save money – that’s been established. It may improve governance but it won’t save money.

13:19:02          From Abigail Slater  Yes…ETR/407 boondoggle.

13:19:03          From Helen Cooper to All panelists  municipal monopoly services, e.g. transit, water and sewage treatment, should never be privatized. The sale of Highway 407 in Ontario is the best example of what a disaster that can be.

13:19:26          From Paul Bedford  Isn’t this the opportunity to pursue road pricing and a share of the income and sales tax??

13:19:34          From Andre Darmanin  @Melinda YES on Equity. RE: Privatizing public spaces should never be an option.

13:19:54          From Abigail Slater  municipalities should be able to raise funding for affordable housing. There are many models with impact funds that are able to provide generative returns to investors while also providing affordable units.

13:20:16          From Adam Ballah to All panelists  Privatizing/charging for roads? Put a price on them instead of subsidizing/providing them free to cars. Pie in the sky, I know, but it’s done elsewhere.

13:20:35          From Helen Cooper to All panelists  it’s time to revive

13:20:41          From Abigail Slater  Sales tax can be regressive…

13:20:49          From Allison Ashcroft  tolls are a good idea and will help move people back to transit

13:20:53          From Andre Darmanin  Now Whatever happened to bonds? I know American cities use them.

13:20:54          From Abigail Slater  Bikes are great until winter comes

13:21:19          From Darren Randell  Snow clearing costs may be reduced..especially in public service facilities

13:21:21          From Abigail Slater  And are not always useful for those that don’t live downtown…or

13:21:23          From Adam Ballah to All panelists  Make bike lanes convertible depending on season.

13:21:36          From Hilary Carlson to All panelists  congestion pricing is an excellent idea but it would not be well received politically

13:21:38          From Melinda Munro  Bonds are an interesting idea. They let people like me who have discretionary income to invest in my own community rather than invest in random mutual funds.

13:21:57          From Melinda Munro  But bonds are considered ‘debt’ and are avoided in the same way that other municipal debt is avoided.

13:22:03          From Allison Ashcroft  redirect pension funds towards affordable housing instead of REITs

13:22:08          From Kathleen Llewellyn-Thomas  we need a renewed approach to housing. Housing should be a right as recommended by our own UN Housing Rapporteur. Need to move to Vienna Model. https://ucalgary.ca/cities/files/cities/forster_the-vienna-model-of-social-housing.pdf

13:22:10          From Melinda Munro  But I would buy a bond to build affordable housing in my city and to invest in transit.

13:22:37          From Colleen Kaiser  Bond funding via direct ballot propositions are a major source of revenue for building transit in California – for example LA

13:22:38          From Patrick Kyba  What about wage reductions for city workers? Do unions have a part to play in this?

13:22:39          From Cheeying Ho  Paid parking in small municipalities. Many small munis don’t charge for parking!

13:22:40          From Melinda Munro  I see bonds as different from ordinary debt.

13:22:44          From Lindsay Vanstone  With the change to free on street parking in Edmonton, there was an immediate change in use of private parking facilities compared to street parking. Cost savings, quick behaviour change.

13:22:47          From Helen Cooper to All panelists  stop this irrational thought process. align service provision with the revenue generating tools that align with that service.

13:22:54          From BJ Danylchuk  Melinda Munro….I would buy a bond for those types of things too!

13:23:16          From Abigail Slater  @Melinda…I agree. They are longer term and today’s rates could not be more affordable -of course this can change.

13:23:18          From Abigail Slater  Is anyone working on a dedicated municipal acquisition fund in collaboration with the federal/provincial governments and the charitable sector (community bonds) to maintain and build additional affordable housing ?

13:23:50          From Beate Bowron  can you talk some more about the concept of municipal bonds?

13:23:50          From Patrick Kyba  @Enid: Will cities have to reduce employees wages? Will unions cooperate?

13:23:53          From Andre Darmanin  @colleen – Measures M and R. I always use examples of LA as bonds and income tax increases that work. Metro Van tried to do it and failed

13:24:02          From Melinda Munro  Great project for Munk School – investigate municipal bonds. Lots of us Gen X and Boomers with extra money who want to help our cities.

13:24:04          From ajeev bhatia to All panelists  @abigail I’m snapping my fingers over here

13:24:13          From Darren Randell  I see the use of Edmontons model for municipal development corporations being a more effective and efficient development scenario

13:24:23          From Andre Darmanin  See… Seems like Municipal Bonds are worth exploring as an option.

13:24:25          From Almos Tassonyi  Municipalities have room to borrow for long term projects. Municipal bonds are sold through investment dealers or there are provincial agencies- as in BC and Nova Scotia

13:24:32          From Sam Weller  Bonds are not a source of revenue. They are just a different way to borrow. More revnue sources are the issue.

13:24:41          From Lindsay Vanstone  I’ve heard municipalities in the US are having challenges repaying the bonds now that were used to build expo centres, etc. since the revenues are gone.

13:25:00          From Samantha Moras  All panelists: How significant are the savings due to reduced service levels / layoffs? Do they meaningfully offset revenue loss / additional costs?

13:25:19          From kevin Millsip to All panelists  How do higher user fees differ from higher taxes? You can make taxes more progressive than, in general, user fees will be.

13:25:47          From Andre Darmanin  @Almos. You’re the Mun Fin expert. (I read many of your reports in the 90s.) So are bonds an issue worth exploring further?

13:26:40          From Melinda Munro  agree – progressive local taxes are important.

13:26:40          From Andre Darmanin  @lindsay. Like Stadiums?

13:26:43          From Allison Ashcroft  agreed, affordable housing. just like asking these institutional investors to divest from fossil fuels, can we also ask them if they are to invest in real estate to invest in community land trusts, affordable housing, or a new hybrid version of REITs that is focused on maintaining and restoring the 70s apartment buildings acorss cities that provide the defacto affordable housing., may require two tranches of investment, with the first being federal and receives no dividend.

13:27:12          From Almos Tassonyi  The US borrowing rules and circumstances are different- also there are different types of bonds- some related to the cash flow from the project- others are secured as general obligation bonds- municipal bonds in Canada are not tied to revenue from projects but to the general revenue raising capacity of a municipality

13:27:48          From Ann Wong to All panelists  any municipalities entertaining wage or hire freezes as part of the recovery?

13:27:49          From Andre Darmanin  Property taxes are a good source? But they are the predominant source for munis and they are stretched thin.

13:28:04          From Andy Manahan  Enid makes an important point. Let’s have an in-depth “who does what?” conversation – break down the silos.

13:28:21          From Allison Ashcroft  user fees are how to drive conservation behaviour

13:28:33          From Emily Wall, CUI Staff  Please help CUI improve its CityTalk programming with a short post-webinar survey – https://bit.ly/2SobL5g

13:28:35          From Lorne Cutler to All panelists  This crisis is much different than any other economic downturn, including 2008.09. In those recessions, federal and provincial governments reliant on income and sales taxes were much worse off than municipalities reliant on property tax.

13:28:49          From Abigail Slater  I worry about user fees for things like parks…which does disproportionately affect those least able to pay…

13:29:08          From Abigail Slater  Vs water which can direct behaviour.

13:29:15          From Lorne Cutler to All panelists  If you receive users fees for running a service, there will be a much lower commitment by those providing the service to maintain quality and high service levels.

13:29:15          From Andre Darmanin  @Abigail. User fees need to be equitable.

13:29:19          From Melinda Munro  WE have ‘who does what’ conversation all the time. The problem is that the province (at least in Ontario) decides that they don’t want to do things and download them without any money. So we never say what should we not do at all.

13:29:22          From Lindsay Vanstone  @Almos Thanks for that difference

13:29:57          From Melinda Munro  @almos agree. Useful to think about how a bond would be structured.

13:30:14          From Allison Ashcroft  user fees need to be balanced with equity too or are regressive and become elite and preferred access for those who can afford. a significant toll $$ provides open roads for people in high income, for eg

13:30:32          From Andre Darmanin  Thanks for the discussion everyone. Let’s continue this on Twitter and LinkedIn @andredarmanin

13:30:56          From Canadian Urban Institute  #citytalk

13:31:04          From Aidan Carter to All panelists  I like this chat format – different from the usual presentation and Q&As. Should send the chat comments around!

13:31:47          From Aidan Carter  I like this chat format – different from the usual presentation and Q&As. Should send the chat comments around!

13:31:54          From Sue Hallatt, CUI Staff  We will post the chat at canurb.org/citytalk – look for the recording of this session

13:32:10          From Emily Wall, CUI Staff  Please help CUI improve its CityTalk programming with a short post-webinar survey – https://bit.ly/2SobL5g

13:32:23          From Allison Ashcroft  munis play significant role year round in building resilience and unearthing, managing and hopefully overcoming inequities

13:32:34          From Aidan Carter  thanks!

13:32:37          From Abigail Slater  Thank you all! Awesome!

13:32:39          From Arlene Etchen to All panelists  Thank you!

13:32:51          From Debra Nyczai  Thank you!

13:32:53          From James Janovsky  Thank you to the panelists!

13:33:01          From Alana Buchanan  Thanks!

13:33:02          From Nadia Todorova  Great panel! Well done, everyone.

13:33:07          From Sam Weller  Go to cagfo.ca for more information on finance solutions

13:33:10          From Matt Greco  thanks all! very informative.

13:33:11          From Rafael Villarreal to All panelists  Great panel, thanks!!

13:33:12          From Allison Ashcroft  excellent conversation from extremely knowledgeable panel and open discussion

13:33:19          From Colleen Kaiser  Thanks ! Great panel!

13:33:22          From Shannon Gordon  Thanks! from Whistler, BC

13:33:24          From Sam Cui to All panelists  Great Talk. Thanks!

13:33:26          From Matthew Gratton  Thank you, everyone.

13:33:27          From Bill Hibbs  Excellent, thank you!

13:33:30          From Eva Chu  Thank you all so much )

13:33:34          From Sarah Thomas  Thanks for your insights everyone!

13:33:36          From Scott Vokey  Well done Panel! Great discussion.

13:33:38          From Ann Wong to All panelists  thanks !

13:33:42          From Abigail Slater  Noon or 12:30?

13:33:45          From Andréa Callà  Excellent and informative discussion – thank you Mary, CUI & panelists for hosting.

13:33:46          From Andre Darmanin  Thanks everyone

13:33:48          From Sean Lee  Great series, thanks!

13:33:50          From Melinda Munro  really enjoyed this!

13:34:03          From Henry Paul Gichana  Thanks all

13:34:04          From Almos Tassonyi  thank you

13:34:09          From Augusto Mathias  THANKS EVERYONE

13:35:15          From Lester Brown  Excellent discussion on the panel on the chatbox.

13:35:28          From Sharon Shuya  Recovery and Reimagining the future has to be part of the same conversation. The pandemic needs to challenge us all to reflect on what needs to change. I agree we need to take this opportunity to move beyond what has been broken as a society and pivot to a brave new world, as hard as it is to image right now. THANK YOU to the panelist and Mary for hosing such an important conversation.

13:35:33          From Andre Darmanin  Remember to add me on LinkedIn and Twitter @andredarmanin

13:39:55          From Canadian Urban Institute  Will close the chat in a few minutes, so please leave your final comments now.