{"id":11450,"date":"2010-05-31T09:00:02","date_gmt":"2010-05-31T13:00:02","guid":{"rendered":"http:\/\/spacingtoronto.ca\/?p=11450"},"modified":"2013-01-21T13:12:03","modified_gmt":"2013-01-21T18:12:03","slug":"lorinc-furious-george-takes-the-subway","status":"publish","type":"post","link":"https:\/\/spacing.ca\/toronto\/2010\/05\/31\/lorinc-furious-george-takes-the-subway\/","title":{"rendered":"LORINC: Furious George takes the subway"},"content":{"rendered":"

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George Smitherman\u2019s $17.4 billion transportation platform reads like the work of a old parliamentary hand who knows a thing or two about the dark art of cabinet making, and I\u2019m not talking furniture.<\/p>\n

If you\u2019re the boss, you understand that you need to dispense the bounty both geographically and demographically, taking care to pay off your base while reaching out to less adoring constituencies.<\/p>\n

So by my count, the Smitherman plan offers a little civic something for everyone: subway extensions in Etobicoke, North York and Scarborough; just enough Transit City, pedestrian and bike lane language to make progressives look at him twice; public-private partnerships for Bay Street; free rides for seniors; and about 500 metres of tunnel for some lonely squadron of Liberal foot soldiers manning their redoubt on Mount Dennis, which apparently will become the new western terminus for the Eglinton LRT.<\/p>\n

The plan, moreover, is vintage big-tent Liberalism, in that it unapologetically encroaches on the policies of most of Smitherman\u2019s rivals, not to mention Mayor David Miller\u2019s.<\/p>\n

Lastly, the two-phase strategy \u2014 most of the $7 billion in \u201cincremental\u201d spending is back-loaded onto a second term \u2014 doesn\u2019t make his former cabinet colleagues (and future enablers) look like dupes, say provincial sources, who feel his plan won\u2019t force Metrolinx to trash their latest build-out scheme.<\/p>\n

<\/p>\n

But while \u201cTransit Delivered\u201d is a textbook example of constituency appeasement, it is also plausible (except for the free seniors\u2019 passes) from a transit policy perspective. So why, then, did Smitherman not apply a comparable level of attention to the money aspect? The omission seems like a bizarre oversight in a campaign dominated by the same.<\/p>\n

It\u2019s difficult to judge whether Smitherman is being sloppy or coy, but the dynamic of this race is that both Rocco Rossi and Sarah Thomson anted up financing strategies \u2014 admittedly flawed \u2014 to accompany their transit platforms.<\/p>\n

The bulk of what Smitherman revealed on Friday (e.g., \u201cTransit Trust,\u201d the reliance on \u201ctriple-P\u201d project management) had to do with bookkeeping, and thus doesn\u2019t address basic questions: Where does he find the cash? How do the associated financing costs impact the City\u2019s overall operating budget? And what will he do to ameliorate the increased operating shortfall of an enlarged TTC? (That last one is a question none of the subway enthusiasts have been willing to touch.)<\/p>\n

Let\u2019s focus for now on the capital piece.<\/p>\n

As my colleague and Spacing columnist Steve Munro notes<\/a>, the projected capital cost of the additions come to less than $4 billion (2010 dollars), compared to the $7 billion cited in Smitherman\u2019s speech. The padding, his handlers say, is about making conservative projections, and the bulk will be spent between 2015 and 2020.<\/p>\n

Smitherman contends that if the City outsources project management to design-build-finance consortia, it may face higher carrying costs over a longer period than would be incurred with traditional debentures. But the extra expense, he claims, will be offset because this approach allows the City to insulate itself against St. Clair West-style overruns (i.e., the design-build groups agree to deliver the project at a fixed price by a given date rather than coming back for top-ups).<\/p>\n

Yet besides touting his own adventures with health care triple-Ps, Smitherman failed to properly explain a complicated financing arrangement and provide defensible projections as to the size of net benefit. While such methods may bring down cost, they won\u2019t get him the whole way.<\/p>\n

So where does the rest of the capital come from?<\/p>\n

He insists there will be more detail later about revenues derived from development spurred by transit construction \u2014 a claim Mel Lastman made but neglected to deliver while shilling for the Sheppard line.<\/p>\n

When asked about using asset sales to finance transit construction, Smitherman has left the door wide open. But as campaign spokesperson Stefan Baranski told me in an email yesterday, \u201cGenerally speaking, no. However, George has indicated a willingness to look at asset sales where it makes sense \u2014 for non-essential services<\/em> like the Toronto Parking Authority. [emphasis added].\u201d<\/p>\n

Might such non-essential services include Toronto Hydro? It wouldn\u2019t surprise me. [editor’s note: Smitherman’s campaign says he will keep Toronto Hydro public<\/a><\/em> ]<\/p>\n

But the real sleight of hand here has to do with the City\u2019s debt level.<\/p>\n

During Friday\u2019s scrum, Smitherman made an oblique reference to an April 6th report from Moody\u2019s Investor Services, which concluded \u2014 contrary to what almost everyone thinks \u2014 that the City of Toronto has an enviably low debt burden relative to other Canadian and international cities, as well as \u201cmanageable\u201d debt-servicing costs (currently about $450 million per year).<\/p>\n

Referencing recent council reports<\/a> [PDF], Moody\u2019s further noted that the City will have more room to borrow after 2016, when its net debt levels begin to fall as the backlog of non-transit infrastructure repair ebbs. By no coincidence, that\u2019s also when Smitherman\u2019s transit project spending scheme ramps up.<\/p>\n

So why wasn\u2019t this telling detail part of Friday\u2019s announcement?<\/p>\n

That\u2019s an easy one. Smitherman would have to acknowledge that Miller\u2019s financial management hasn\u2019t been nearly as horrific as he\u2019d have voters believe.<\/p>\n

photo by Sam Javanrouh<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

George Smitherman\u2019s $17.4 billion transportation platform reads like the work of a old parliamentary hand who knows a thing or two about the dark art of cabinet making, and I\u2019m not talking furniture. If you\u2019re the boss, you understand that you need to dispense the bounty both geographically and demographically, taking care to pay offContinue reading “LORINC: Furious George takes the subway”<\/span><\/a><\/p>\n","protected":false},"author":4051,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ngg_post_thumbnail":0,"_ef_editorial_meta_paragraph_assignment":"","_ef_editorial_meta_date_first-draft-date":"","_ef_editorial_meta_checkbox_needs-photo":"","_ef_editorial_meta_number_word-count":"","footnotes":""},"categories":[2,8],"tags":[94,15180,425,15182,22100,6245,426,551,4620,15183,15184,10726,663,14677,89,5772,15186,1187,15181,19,6851,15185,391,496],"class_list":["post-11450","post","type-post","status-publish","format-standard","hentry","category-politics","category-transit","tag-2010-election","tag-campaign-spokesperson","tag-david-miller","tag-design-build-finance-consortia","tag-editor","tag-george-smitherman","tag-mayor","tag-mel-lastman","tag-mount-dennis","tag-non-essential-services","tag-project-management","tag-rocco-rossi","tag-sam-javanrouh","tag-sarah-thomson","tag-scarborough","tag-spacing-columnist","tag-stefan-baranski","tag-steve-munro","tag-subway-george-smitherman","tag-toronto","tag-toronto-parking-authority","tag-transportation-platform","tag-usd","tag-york"],"acf":[],"yoast_head":"\nLORINC: Furious George takes the subway - Spacing Toronto<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/spacing.ca\/toronto\/2010\/05\/31\/lorinc-furious-george-takes-the-subway\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"LORINC: Furious George takes the subway - Spacing Toronto\" \/>\n<meta property=\"og:description\" content=\"George Smitherman\u2019s $17.4 billion transportation platform reads like the work of a old parliamentary hand who knows a thing or two about the dark art of cabinet making, and I\u2019m not talking furniture. 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