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AlvinofDiaspar
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From the Star, GTA section:
T.O. ponders how to spend $1B
Windfall from Toronto Hydro Subway, lakefront likely to benefitCity to receive windfall from Toronto Hydro
Spadina subway line, waterfront renewal to benefit
Jul. 26, 2006. 05:36 AM
JOHN SPEARS
CITY HALL BUREAU
A billion dollars just doesn't go as far as it used to.
Faced with the prospect of $980 million flowing into Toronto's coffers, city councillors could dream of more than enough ways to spend it.
The windfall comes from Toronto Hydro, the city-owned utility that owns and operates the wires that deliver electricity to homes and businesses.
Formerly a not-for-profit co-operative owned by its customers, the former provincial Conservative government under Mike Harris handed direct ownership of Toronto Hydro to the city in 1998.
The city in turn decided to structure its new profit-making corporation as a regular business, holding about 40 per cent of its capital as shares, and 60 per cent — or $980 million — as debt owed by Toronto Hydro to the city.
Now, the city wants the debt paid out in cash — which likely means Toronto Hydro will raise the money from other lenders on public debt markets by issuing bonds or debentures.
That raises the thorny question: How do you spend a billion dollars?
Joe Pennachetti, the city's chief financial officer, urged councillors yesterday to put the money into a reserve account earmarked for big infrastructure projects being carried out in partnership with the federal and provincial governments.
Under those rules, the $980 million is likely to be swallowed up by two projects already on the drawing board:
The city has committed $500 million for waterfront renewal, a project that Ottawa and Queen's Park are committed to joining.
Pennachetti estimates the city will spend up to $400 million extending the Spadina subway line to York University.
The money is likely to flow to the city in instalments over a period of years, with the final instalment as late as 2013 and the first coming some time in 2007.
Councillor David Shiner — who's also a director of Toronto Hydro — argued that since the money is coming from an energy company, at least 25 per cent of the windfall should be set aside for "green" energy or conservation.
He also argued that spending most of the money on the waterfront and Spadina subway will benefit certain parts of the city disproportionately.
"Part of this money has to go across the whole city," said Shiner (Ward 24, Willowdale), since it was raised from hydro customers city-wide.
Councillor Michael Walker (Ward 22, St. Paul's) said it should be up to the new council to be elected in November rather than an "old council in its dying breath."
The issue also exposed some local tensions on council.
Councillor Mike Del Grande (Ward 39, Scarborough-Agincourt) objected to spending money on the Spadina subway line when the aging Scarborough Rapid Transit line needs replacing.
Councillor Peter Li Preti (Ward 8, York West) — whose ward will benefit from the Spadina subway extension — bristled that it's not a "pet project," and will undo past neglect in Downsview.
In the end, council voted to support Pennachetti's proposal.
AoD
T.O. ponders how to spend $1B
Windfall from Toronto Hydro Subway, lakefront likely to benefitCity to receive windfall from Toronto Hydro
Spadina subway line, waterfront renewal to benefit
Jul. 26, 2006. 05:36 AM
JOHN SPEARS
CITY HALL BUREAU
A billion dollars just doesn't go as far as it used to.
Faced with the prospect of $980 million flowing into Toronto's coffers, city councillors could dream of more than enough ways to spend it.
The windfall comes from Toronto Hydro, the city-owned utility that owns and operates the wires that deliver electricity to homes and businesses.
Formerly a not-for-profit co-operative owned by its customers, the former provincial Conservative government under Mike Harris handed direct ownership of Toronto Hydro to the city in 1998.
The city in turn decided to structure its new profit-making corporation as a regular business, holding about 40 per cent of its capital as shares, and 60 per cent — or $980 million — as debt owed by Toronto Hydro to the city.
Now, the city wants the debt paid out in cash — which likely means Toronto Hydro will raise the money from other lenders on public debt markets by issuing bonds or debentures.
That raises the thorny question: How do you spend a billion dollars?
Joe Pennachetti, the city's chief financial officer, urged councillors yesterday to put the money into a reserve account earmarked for big infrastructure projects being carried out in partnership with the federal and provincial governments.
Under those rules, the $980 million is likely to be swallowed up by two projects already on the drawing board:
The city has committed $500 million for waterfront renewal, a project that Ottawa and Queen's Park are committed to joining.
Pennachetti estimates the city will spend up to $400 million extending the Spadina subway line to York University.
The money is likely to flow to the city in instalments over a period of years, with the final instalment as late as 2013 and the first coming some time in 2007.
Councillor David Shiner — who's also a director of Toronto Hydro — argued that since the money is coming from an energy company, at least 25 per cent of the windfall should be set aside for "green" energy or conservation.
He also argued that spending most of the money on the waterfront and Spadina subway will benefit certain parts of the city disproportionately.
"Part of this money has to go across the whole city," said Shiner (Ward 24, Willowdale), since it was raised from hydro customers city-wide.
Councillor Michael Walker (Ward 22, St. Paul's) said it should be up to the new council to be elected in November rather than an "old council in its dying breath."
The issue also exposed some local tensions on council.
Councillor Mike Del Grande (Ward 39, Scarborough-Agincourt) objected to spending money on the Spadina subway line when the aging Scarborough Rapid Transit line needs replacing.
Councillor Peter Li Preti (Ward 8, York West) — whose ward will benefit from the Spadina subway extension — bristled that it's not a "pet project," and will undo past neglect in Downsview.
In the end, council voted to support Pennachetti's proposal.
AoD
