Road Closures and Selfish Solutions

Every year Toronto is subjected to road closures which not only frustrate traffic flow – but cause economic hardship to Toronto’s business community.

The politicians view this as a way of life – ‘the cost of doing business’.

But this ‘cost of doing business’ is on the backs of those who provide jobs, development and taxes which prosper our community. These are the key producers for economic progress and strongest pool for tax revenue. In other words; “the golden goose.”

And they will again be in the crosshairs of policy-makers who repeatedly prey on them until eventually, the goose will die.

The governing powers choose to ignore the fact that every day more and more licences are issued to drivers. These drivers buy vehicles thereby adding to the congestion simply because there are no more roads being built; yet more and more cars are being added. Our streets will eventually be so congested that draconian measures will be proposed and eventually implemented.

The signs are already visible. It starts with some new and necessary public transit being built. Once operational, the politicians will justify that this enabler for movement should be given preference over driven vehicles – therefore justifying a new tax for road use. The new tax will be named “Decongestion Tax”.

Decongestion Tax will be embraced and justified by all politicians – as if the blame lies with drivers instead of governmental bungling in management of assets and priorities. The technology for GPS tracking is already here. Computer chips in cars already track driving patterns. It needs only minor tweaking to calculate taxes based on driving volume. This is the user-fee approach; however there are costlier choices and less harmful options, which will be proposed here.

Traffic arrived long ago. The question is how to remedy, reduce or resolve the problem. At this point, most politicians will huff and puff and point out that the ‘only’ solution is to increase or create more taxes to “solve” this problem. They will hire the usual ‘friendly’ consultants who will report (after “consultations” with the public) that taxation is the preferred solution. (I’ve yet to meet any citizen who feels they should be taxed to a greater degree – it seems these citizens only appear when consultants hold town hall meetings).

After these ‘friendly’ consultants hold a few dozen meetings, the ‘public’, (meaning the tree-huggers who hate cars) will miraculously propose the most popular solution – taxing drivers. This ‘friendly’ consultation process will cost the city several hundreds of thousands of dollars – but it will be justified because the ‘public was consulted’.

Interestingly enough, these ‘friendly’ consultants, when they are hired to assess what salaries (how much to increase) politicians should be paid, they do not hold any public meetings to hear what the people will say. Such consultations do not require the ‘public to be consulted’.

That’s because it’s almost impossible to convince the public that the generous salaries and benefits already being paid to elected representatives should be increased.

“Politics is perhaps the only profession for which no preparation is thought necessary”.       Robert Louis Stevenson (1850-1894)

Let me regress to the main theme… After the few dozen meetings and the hundreds of thousands of dollars are wasted in these consultations on traffic congestion, (here’s where I can save the taxpayers’ money), I can reveal what will be proposed…

 Decongestion Tax

The consultants will propose that a ‘traffic’ tax be charged to Toronto’s drivers in the form of road fees and higher parking costs. Parking increases have already been implemented.

Then the politicians will ‘justify’ this taxation as the reasonable solution since their ‘consultant-experts’ have recommended it. The same ‘friendly experts’ who get hired to recommend politicians should be paid higher salaries.

Here are some ideas that will never see the light of day, since they do not offer the tax-grab solutions which the politicians “reluctantly” prefer to always implement.

Traffic Flow Reductions at No Cost

Traffic flow can be reduced by introducing restrictions to the downtown core* to only four days a week. On Mondays, Wednesdays, Fridays and Sundays, drivers with licences ending in odd numbers can use the downtown core. Those with licence plates which end with an even number can enter the downtown core on Tuesdays, Thursdays, Saturdays and Sundays. This will automatically reduce car traffic by half.

(* The downtown core may be defined as south of Bloor, between Church and Bathurst. It may also be adjusted after a trial period.)

Delivery vehicles (trucks and vans) will be exempt from this restriction. And those few drivers who absolutely need to visit the core daily will be able to purchase a Special Dispensation Permit with plates costing a premium.

This is not a new concept – it’s been implemented in other countries and succeeded.

Now, this solution will free up traffic flow. But it will not increase tax revenues. This will be ignored because the political preference is to apply a tax and increase revenue – commonly referred to as a tax grab.

 Rush Hour Adjustments

Another solution that can be cost-free to implement is to offer businesses an incentive to stagger their work hours during weekdays. For instance, if a business would re-schedule their morning hours from the usual 9 a.m. start to a 10/ 11 a.m. start with respective closing times, such a programme would dilute the congestion that ‘rush hours’ create. It will also breathe considerable relief to TTC operations.

How can Council persuade businesses to implement such changes? Easily; by offering a small discount in business tax rates as encouragement.

Again, this is not the preferred increase-the-tax solution where revenue can be generated. This is a logical solution where everyone benefits and a problem is diminished or removed. An added benefit is that the downtown will enjoy extended hours of operation, making it a more active and vibrant neighbourhood.

Property Tax Holiday

Another approach that should be studied is when roads are closed during construction. We have seen how businesses suffer whenever a road is closed and traffic and clients cannot access a business’ services or products. The inconvenience factor drives customers elsewhere.

These closures result in hardship for the businesses affected. Installing new TTC tracks is often a proven killer for street retailers where roads are shut down or traffic reduced and parking rendered unavailable.

Traditionally these closures have been seen as a ‘necessity’ and the retailers are expected to eat their losses. When there are unanticipated delays in construction work, the losses increase and there is no consideration for those businesses which suffer – it’s ‘bite the bullet’ time. Of course, those who do not suffer; the politicians, their bureaucrats and the inefficient, overpriced contractors they hire, spout the usual apologetic bromides about ‘unavoidable delays’.

What is being proposed here, is a tax holiday (no property taxes charged) until construction is completed and traffic flow returns to normal. Why should any businesses suffer twice; paying full taxes to those responsible for the business interruptions and which were imposed by these same tax-collectors?

Some small operators who are clinging by their fingers may actually close down at times like this… but who cares? The politicians and the bureaucrats do not suffer – so, it’s “we send our thoughts and prayers” time for those who went bankrupt.

(Editor: It’s completely coincidental but most noteworthy that Montreal’s City Council approved compensation for businesses that are harmed due to road restrictions. This was announced 3 days after our article was posted. Click here and here.) 

 Accelerate Construction – Diminish Harm

Why not schedule the work around the clock, with crews on afternoon and even midnight shifts? Admittedly, in residential areas, overnight work cannot be allowed due to noise regulations. But in downtown streets which are predominately commercial, two shifts per day are reasonable. And during summers, where the daylight hours are greater, this should be the preferred option.

This solution will finish the work faster and reduce business losses due to traffic loss. And the companies which bid for these projects can easily be encouraged to schedule two shifts, or three or even overlapping shifts. But such changes are outside the thinking of the bureaucrats who run these projects. And if the policy-makers do not request such changes, the contractors will prefer solutions requiring less diligence and lower skill levels.

Now is the time for our business leaders (with BIA input and leadership) to speak out and pre-empt the tax-grab solutions that will soon be introduced. That’s what good management and government is all about – to anticipate a problem and effect timely solutions.

Ignoring an issue until it becomes a crisis and then imposing draconian measures, is not good government – it’s crisis management.

Business is Good

It’s long overdue to change the thinking at City Hall (as well as Queen’s Park) where businesses are seen by the tax collectors as a source for revenue. Those who collect taxes (bureaucrats and their political masters) do not view entrepreneurship as a source of jobs, commerce and prosperity. Most rarely consider that as businesses prosper, they create more jobs and generate more income for employees, for the community and that these results produce more taxes, (albeit indirectly).

Tax collectors have only one view – excise more, whenever required. No thought is given to maintaining a healthy tax base by supporting the business community with proper husbandry.

Farmers know that you feed your animals before you eat breakfast. They know how to care for their fields and livestock. Such priorities increase their harvests.

That attitude is lacking in our political masters. When a business shuts down, employees lose jobs. Unemployment rises as well as employment insurance payments. Instead of collecting income taxes, the government has to support those who lost jobs.

Profit is not evil. Generating revenue is not exploitation. It’s called ‘profit and prosperity’.

I’m sure that all the tax collectors who read this article are laughing at this ‘simplistic’ approach – where increased tax is not used as a cure for all problems. That’s because tax collectors are not entrepreneurs and do not think as businesses – they concentrate on harvesting someone else’s effort – not how to grow the farm.

The environmentally-sensitive (oft referred to as tree-huggers) understand that we are one with the earth. We are here to enjoy it; but also to care for it. In many cultures, when the hunter takes an animal, a traditional ceremony is performed by spilling some blood as a token of thanks for the sacrifice of the prey in giving itself so that the hunter and the tribe may survive.

This is husbandry; this is thankfulness, this is the discharge of an obligation.

Those who govern must take note and embrace the premise that businesses are not an infinite source of milk. When their streets are closed, small businesses suffer. To disregard their pain is akin to starving your livestock.

The only times I’ve seen government show concern is when the banks needed support (a few years ago) when the housing mortgage bottomed because of the re-selling of mortgage scams. The government helped the banks! Then, they helped the big car makers (except for Ford) when car sales dropped. Did the car makers get any funds from the Mexican government where they have assembly lines? No.

Instead, governments give Bombardier millions. The same Bombardier which is now creating jobs in Alabama with Canadian taxpayers’ subsidies.

What about our small mom-and-pop businesses? The middle class which sustains this country’s economy? What does City Council do for them?

It shuts down their roads. It ignores their pain. But continues to harvest them with no regard to their economic health. This attitude has to change.

It’s been said that, “Once in your life, you’ll need a doctor, a lawyer, a policeman and a preacher; but every day, three times a day, you need a farmer.”

It’s time to re-think. It’s time to introduce creative approaches to solving problems. Right now, creativity is used to generate new forms of taxation.

Minor tweaking which can mitigate unnecessary business losses

  • Stop shutting down streets for street events – use parks which are ideally suited and cause no business interruptions.
  • Require all road construction to employ street barriers that can be easily removed. During non-construction hours and weekends, the barriers should be removed to enable normal traffic flow. The usual procedure is to leave barriers up permanently, even when the crews are not at work.
  • Vacant lots and side streets should be used to park construction vehicles which would otherwise be parked on the main street. Any additional space should be made available to prospective customers to park free.
  • The contractors should use vacant buildings for their site offices rather than trailers parked on the street blocking access and visibility.
  • Free short term parking should be made available for customers during construction.
  • Businesses which are negatively affected should receive a “tax holiday” with provision that the benefit be passed directly to the business merchant rather than the property owner.
  • For all projects, the logistics should be developed with a view to minimizing the harm to businesses, and compensation for business losses should be built into the project costs.

“Management is doing things right; leadership is doing the right things.”                    Peter Drucker (1909-2005)

Where is the leadership we pay for?

Styli Papatheodosiou

 Editor’s Note: click for associate article – King Street – Where businesses go to die.

Editor’s on-a-lighter note: – 

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