On Monday, Christopher Hume of the Toronto Star responded to the recent backlash against Sidewalk Toronto with a piece called, Anger over Google’s vision for Toronto waterfront is misguided.
The below excerpt is what I was trying to diplomatically allude to with my post on net present value. We need to look at what we are getting and what we are giving up (by way of foregone revenue).
What had civic (and provincial) nabobs gnashing their teeth was Sidewalk’s suggestion that it should receive a share of city property taxes and development fees. And what would the New York-based outfit do in return? A few things, it turns out. Specifically, it would finance the long-delayed Queens Quay LRT, build the infrastructure necessary to remake much of the Port Lands, launch a new wood-based construction industry and, oh yes, kick-start redevelopment of 140 hectares of long neglected landfill.
I also don’t understand how the possibility of expanding into the Port Lands has come as a surprise to anyone. That was always integral to the opportunity here in Toronto.
What your thoughts?
What I don’t understand is why we need a private company to provide infrastructure that provides a net positive for the city. Doing so is a sign of defeat: It says that we are unable to allocate our taxes in a way that makes a good investment for the city, and we’re so bad at it that we better give up trying altogether and let someone else take over our responsibilities.
For the development part, you don’t need a share of property taxes – you need an investor to buy land, and get the pay-off in terms of how desirable you make the end product. Sure, the infrastructure depends on the city. That’s why you sit down with city officials to work out a plan that works both in your interest as well as in the interest of the city.
Instead, the implication here is that the city is one of two things: that the city is an unreliable partner that will fail to live up to its own objectives (and promises to you) unless you wrangle control from it, or that your plan isn’t in fact in the interest of the city in the first place.
Both of these are bad. The latter is obviously bad and is what many people are assuming, given that the former is fixable. I think that’s the real gist of the issue: if there’s an opportunity to improve the city in ways that we (the populace) want, why should we give control over these outcomes to someone else whose first interest is arguably not to us, but to its investors?
The only reason we should do this is because they’re better at the things that the city has adopted as its main purpose. And contracting this out is only the first step in letting private companies run our lives, after we’ve given up ownership and control over a crucial part of our infrastructure.
If you’re a company, you’re going to focus hard on your core competencies, ensuring that the core of your business is run by knowledgable employees that you work hard to retain. You contract out work that’s commonplace, likely at the fringes of your business. Once you contract out the core of your business, you have lost your value proposition and your reason to exist as a business. Your contractors are now in a position to poach your customers, you are unnecessary as a middleman.
In the same way, I think there’s an argument to be made that as a city, the core of your business is city planning and providing infrastructure. You don’t contract that out. If you suck, you find ways to get better at it, for the sake of your shareholders (i.e. we the people). If you don’t suck, why even consider giving up your business to some upstart whose interests may be aligned now but for sure won’t be aligned in perpetuity.
Instead, how about we work on our core competencies of city planning and providing infrastructure and then Sidewalk as well as anyone else around can benefit from the extra value that’s been created for everyone’s benefit.
What Jakob said. It feels all kinds of wrong and a hard line too far down the wrong road.
There have been many proposals over the last 10 years from private interests for the Port Lands, some good, some bad, some known and others never more than a meeting. The challenge has always been that the City does not have a process that allows the private sector to pitch an unsolicited proposal for a public asset that provides intellectual property protection for the solicitor but also a transparent process for other parties to openly bid on the same opportunity. A Swiss Challenge model could work for the development of the Port Lands if the City seriously pursued a framework to implement it. We have to remember that the Port Lands is 800 acres of publicly owned land, whatever happens to it, and I hope it is something consistent with the vision that the City and Waterfront Toronto have the Port Lands, is implemented in a competitive manner that is fair and transparent and also achieves some of the other objectives that we haven’t really heard about from Sidewalk Labs such as affordable housing, recreational facilities, schools and daycares, and a diversity of employment opportunities for residents.