Transport Committee on Feb. 5th, 2008

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Thank you very much.

My question is for you, Mr. Vaughan, for the simple reason that, before becoming a member of Parliament, I was President of the Union des municipalités du Québec. What you say today is very important. You signed the letter as a municipal councillor of the City of Toronto. I sense that you're uncomfortable with the amendments. So far, you're the only witness who has shed light on certain problems, including those concerning appointments to the board of directors and changes made to the act.

I'd like to know why the City of Toronto didn't file a brief. A resolution would have been appreciated. I understand that it's a big city and that it's not easy. However, I would like you to give us an explanation. That might change our way of viewing the bill. What you say is important to me. If the way the Conservatives want to change the board of directors penalizes the City of Toronto... I especially don't want one of Canada's major cities to be penalized by this bill.

Why didn't the city table a brief or resolution? I'm going to leave you the time to answer.

[Adam Vaughan]

The city did not pass a resolution because the details of this legislation did not reach city council in a timely fashion.

When we reviewed this with the mayor's office and the secretary who has control over the waterfront and read the minister's comments that this particular funding would not be new dollars but would come out the existing framework, we realized this put a risk on our ability to tap into the dollars for transportation and infrastructure destined for cities for an array of projects, from transit to highway improvement to bridge reconstruction, and that the city of Toronto would be competing with a federally constituted body for precious infrastructure investment from Ottawa.

I can assure you that if the position was put in front of city council that local authority to drive infrastructure investment was going to be supplanted by a group of people who are appointed by the federal government and have no accountability or relationship to the city or port, there would be unanimous endorsement to oppose the proposed changes to the Canada Marine Act and infrastructure management of this sort. The issue is about local accountability, local agencies, and in particular local governments' ability to control both the planning process and economic development of their agencies.

I can understand there might be a national interest in making sure that ports in Vancouver, Prince Rupert, and Halifax are there to serve the needs of the national economy. There is a case to be made for those ports to fall under federal jurisdiction.

The city of Toronto's port is the 44th smallest port in terms of size. It moves 0.4% of the cargo by sea in this country. Almost all of that is internal to the economy of the city of Toronto. Setting up a federal agency that is not accountable to the port users, the local city, or for that matter the shipping industry, in such a way that competes with cities for scarce transportation dollars is something the city of Toronto would not, cannot, and will not support through a resolution. I apologize that we didn't get it in front of the council sooner.

But make no mistake about it, as other cities learn about the implications contained in this brief and this legislation, I think you'll hear from the Federation of Canadian Municipalities and other municipal jurisdictions. It is not appropriate to put cities in competition with federal agencies for federal dollars. It's unacceptable.

On the last point, Mr. Volpe talked about the viability of this port authority. This port authority has lost money every single year that it has been in existence. Its only source of income has been to sue people. It's now trying to sue me for building a sidewalk to a local school that it says didn't even exist under its transportation planning. It was there for ten years prior to the port authority.

This port authority does not respect local authority and local government. It doesn't invest its dollars in shipping activities. It's building parking lots. It built a ferry dock to the Rochester ferry a year after the Rochester ferry stopped running. It doesn't participate in shipping activities. To take dollars out of Halifax and Prince Rupert and put them in the Toronto waterfront doing God knows what—certainly not repairing the harbour wall, because we can't get the federal government to even accept responsibility for something they built in 1911.... But to take dollars out of critical and needed infrastructure investments on our coasts, to aid prairie farmers, miners in northern Ontario, and the lumber mills of B.C. and Quebec.... They can't get their goods out through Toronto's port. It's not even hooked up to rail any more. It has disappeared as a port.

All we have to say on that falls on deaf ears when it comes to Ottawa. And you're asking for a council resolution.

I'm asking you to be resolute in supporting strategic ports like Montreal and Prince Rupert, which are fundamental to the national economy. I would ask that you leave Toronto's waterfront to the city of Toronto and let us develop it so it serves our local economy, which quite clearly is not a shipping economy and not one that is focused on international trade.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

In your opinion, why aren't the federal members from the Toronto region adopting the city's position?

[Adam Vaughan]

Well, a number of federal Liberal MPs supported me when I ran for city council.

[Mario Laframboise, Bloc, Argenteuil—Papineau—Mirabel, QC]

Really?

[Adam Vaughan]

Really.

[An hon. member]

Name them.

[Adam Vaughan]

Tony Ianno was frequently in my campaign office offering assistance, and he is still in communication with me.

But I ran as an independent.

[The Chair, Conservative, Merv Tweed]

Please, gentlemen, stick to the question.

[Adam Vaughan]

I ran as an independent, and from my conversations with various Liberal MPs, it seems that internal interests unique to the Liberal Party trumped good governance. That's what happened at the port authority. And that's why even the Liberals, in the run-up to the last election, were afraid to appoint people to the port authority. They were afraid of what it would do to their reputation in Toronto.

Sadly, the response to that by the current government has been to appoint people with no recognition of the governance requirements of the port authority acts.

So we're trying to figure out what Ottawa is doing in our port. We're trying to figure out why Ottawa has an interest in our port. It's surely not for anything that moves in by boat. I'm not even sure the people they've appointed to the port authority know how to swim.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Vaughan.

Mr. Masse.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

I can assure committee members.... I just came from a previous committee where the Conservatives and the Liberals added late witnesses and they extended a meeting. Subsequent to that, there are mayors of those municipalities who have already attended those meetings without resolutions from the council and will not have resolutions when they appear before that committee. So there's no reason to apologize for the fact that you're here without a resolution.

Now I want to move forward on some of the issues. It's important to get to some of the particulars here. It is correct that this legislation will allow for this port authority, Toronto in particular, and others, to apply for $2.1 billion in gateway funds. Those funds could be drawn in competition versus other infrastructure projects like the Windsor-Detroit area and other types of east-west and north-south infrastructure.

Second, it is true in this situation with Toronto, from documents that have been submitted to this committee, that it will be able to borrow $27 million and also be able to carry nearly $14 million in long-term debt.

Also, what's pertinent what we're hearing today with this is another answer to a question I had in terms of land use policy. And this is a quote from the document that we have here. “The policy initiative is intended to facilitate and expedite the effective use of existing or newly acquired properties through leases or licences to third parties”--which may be effective in some places, but in others, where there's conflict with the current situation, there is not that type of provision in this bill to significantly help those different municipalities deal with the situation.

So my question to the witnesses here today is, if this is allowed, in terms of additional moneys to be borrowed to be able to have long-term debt to compete for federal infrastructure funds, in the type of situation right now, will it worsen or heighten the problems in your municipality in Toronto, in this particular instance? And in general, do you think it might create conflict in other regions?

[Adam Vaughan]

This returns me to the position of the fact that this port authority is not running a port, so why are you giving it borrowing power? What does it need to finance that's so critical and necessary to the infrastructure, fiscal or transportation or otherwise, of the Government of Canada? Why do you need to allow this facility to borrow money? One of the reasons it does borrow money is to keep itself afloat. This is a port authority that has proved adept at doing one thing very well, and that's lose money.

So they had some land holdings, some residual land holdings from when it used to be the Toronto Harbour Commission, before it was taken away from the City of Toronto.

You speak to the fact that they're not supposed to build condominiums, but the reality is that the port authorities in the past have been very engaged in facilitating that kind of construction, but they're not engaged in waterfront activity.

We've been trying for a year and a half to get them to fix the two shipping channels that enter the harbour of Toronto. They won't do it. Part of the problem is they have no money to do it, but part of the problem is they refuse to take jurisdiction over the issue. Conveniently, when the letters patent were drafted for the port authority, they removed the harbour from the jurisdiction of the port authority. What they left it with was a couple of ferry docks and a couple of shipping channels, but they only have jurisdictional control over the navigation of those channels. They don't actually have control of the maintenance of those channels. Why would you do that? I don't get it.

In creating capacity for this body, which is accountable to nobody but the minister, its public meetings are defined by 15 minutes of questions with someone who basically directs them towards port authority lobbyists. They spend more money on lawyers and lobbyists than they do on shipping. So in giving them the ability to borrow, I would assume for capital and capital only investments, one would have to ask, what's the long-term strategy on the waterfront? They don't have one. What's their interaction with the port? Beyond the three private shippers that move salt, sugar, and sand into the city, there is no relationship. The one thing they've built on the waterfront, for about $10 million, was a ferry dock that had no service to it for transportation, was not built in the inner harbour, where people use the inner harbour, and was built after the ferry it was built to serve essentially went bankrupt.

The only thing that remains, beyond the website with the non-existent ferry, are signs on the highway to a non-existent ferry dock. It's a calamity. It's a disaster. Why the new government would even think of appointing people to this body rather than dissolve it is beyond me. But giving it the ability to borrow money and to give it access to a pool of capital, which, as we know, is scarce and growing scarcer here in Ottawa, and to rob that capital from places like Montreal, which is striving to build a real port and move real cargo, or from Prince Rupert and the deepwater ports on the west coast, which are a fundamental part of the resource and agricultural sectors of the prairies, to take that money away from those industries and to make it accessible to a bunch of yahoos down on the waterfront in Toronto, I don't get it. I just don't get it.

We have bridge problems getting cargo back and forth across the U.S. border. Are we building more bridges? No.

[Brian Masse, NDP, Windsor West, ON]

One of the amendments that I'm proposing is to have the Auditor General be able to audit all ports in Canada with an annual audit. Is that something that your organizations would support?

[Adam Vaughan]

Absolutely.

[A witness]

We would support that.

[A witness]

Go for it.

[Brian Masse, NDP, Windsor West, ON]

Lastly, is there anything that can be done with regard to the municipal act and the ports? One of the things we're looking at is how we can actually have the ports somehow be able to go through or be vetted similar to the municipal act. Would that give at least some type of assurance to local property owners?

[Adam Vaughan]

When the federal Liberals set up the infrastructure program, they did it with a great deal of intelligence and sensitivity to local initiatives, understanding that local initiatives really needed to drive the agenda when it came to federal infrastructure programs.

I think it was Paul Martin, in an interview I did with him when I was at the CBC, who said that our job is not to pick where to build a bridge, but to facilitate those economies that can afford to build a bridge, and help them build a second one if necessary.

We need to use the federal infrastructure money as a form of economic development, but local economies know where that infrastructure is needed, and they know best. From that principle, the infrastructure program has made a significant difference to large, small, and medium-sized communities across this country. It was a very smart move.

What this piece of legislation seeks to do is to eliminate local authority from the discussion, to put local investments in the hands of a federally appointed body that has no electoral accountability to anybody, and then to say that it will compete with duly elected officials on the ground for scarce infrastructure dollars. That's unacceptable.

I would hope that the Liberals, who had the intelligence to use local government to drive the infrastructure program sensitively, creatively, and to great benefit of economies right across this country, would have the equal wisdom to respect those principles in this new piece of legislation. Instead, what you end up with is more largesse.

[The Chair, Conservative, Merv Tweed]

Thank you, Mr. Vaughan.

I will go to Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Thank you, Mr. Chair.

Thank you, witnesses, for appearing today.

I just want to let you know that if you do that motion of council, if you don't want any money for Toronto for the port authority, you can put it into Fort McMurray in anything you like, because that's what I represent, and we need all we can get. We'd be happy to take any money you don't want.

[Adam Vaughan]

It's for a port authority.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

We can start a port, whatever it takes.

At this stage, though, I do want to confirm something that was mentioned by one of the witnesses. Toronto actually is the sixth largest port, as far as operating revenues, excluding the airport, in Canada. I want you to be aware of that.

I have the figures here, Mr. Vaughan. I'm not trying to be argumentative, but I have the figures in front of me. I was astonished that it's $9 million a year, but it's the sixth largest in Canada, and that does exclude the revenues from operating the Toronto City Centre Airport. I'm not trying to be argumentative because I'm from northern Alberta. I just want your money that you don't want. So that's not a problem.

[Adam Vaughan]

We'll get you different information, but it's the 44th largest port in Canada. Goderich, Ontario, moves more cargo than Toronto.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

I'm just providing the figures that I have, and I'd be happy to table them, if you'd like that.