Ontario may charge stores for parking spots

Government agency wants retailers to pay 25 cents per spot a day
5/27/2013

Retailers in the Greater Toronto and Hamilton areas may have to pay a levy on their parking spaces in order to fund public transit programs.

On Monday, Ontario’s transportation agency, Metrolinx, proposed charging commercial enterprises, including retailers, 25 cents per day for every parking spot they have.

It was one of several initiatives suggested in a report by Metrolinx to raise $2 billion a year to pay for transit in the congested Toronto and Hamilton areas.

Other money-raising proposals included raising the HST to 14% from the current 13%, a five-cent a litre regional gas tax, as well as increases to development charges.

The actual fee per parking spot would vary depending on relative current value assessments, according to Metrolinx.

But businesses would, on average, pay 25 cents for every off-street, non-residential parking space they own. Companies with 100 parking spaces would, presumably, be charged $25 per day, or more than $9,000 a year.

The Retail Council of Canada came out against the idea, which its officials described as little more than a new tax.

"A tax on free parking spaces is just another form of property tax and would ultimately affect all consumers alike, whether they drive, take transit or walk to the store," RCC’s senior vice-president David Wilkes, said in a statement.

In an interview with Canadian Grocer yesterday, Wilkes said Metrolinx's parking spot plan was a “blunt instrument” to raise money since retailers would be charged the fee regardless of whether a parking spot had a car parked in it or not.

Retail Council of Canada represents most of the major retailers in Canada, including grocery chains such as Loblaw, Metro, Canada Safeway, Sobeys and Walmart Canada.

Wilkes said his organization does understand the need to invest in public transit, but he said that charging supermarkets and other retailers for the parking spots they provide customers for free is not the best way to accomplish that goal.

In a statement, RCC said that it believed retailers would inevitably pass the costs of the parking fees on to consumers.

"It would be a double-whammy for consumers, over and above (the) Metrolinx proposed 1% sales tax increase," Wilkes noted.

Metrolinx estimated the parking levy would generate $350 million annually.

Metrolinx’s proposed gas and sales tax hike would cost an average family $477 but that would increase to about $977 for a family of five with an above-average income and two cars driven a total of 40,000 kilometres a year.

Metrolinx president Rob Prichard said the agency realizes $477 a year is a lot, but he says that will be offset by the benefits of less congestion.

Metrolinx is also recommending other tools, such as paying for parking at GO Transit stations and allowing drivers to pay to use carpool lanes even if they have no passengers.

The transportation agency says all the revenues would be dedicated to public transit projects, with 25% carved out for municipalities in the area to spend on local transit and transportation projects.

Premier Kathleen Wynne said her government will take the recommendations under advisement but action has to be taken.

``The congestion situation in the Greater Toronto and Hamilton area cannot be allowed to continue. And so it is absolutely critical that we have a dedicated revenue stream.''

But the Metrolinx proposals are just one part of the discussion and there are other possibilities to fund what's being called The Big Move, a 25-year plan to expand transit in the region.

The public will be consulted before any decisions are made, Wynne said. Legislation to implement the new fees will likely come in spring 2014.

``We'll be engaging with the people of the province about how we make sure we have a dedicated revenue stream particularly in the greater Toronto Hamilton region,'' she said.

But the minority Liberals need the support of at least one of the opposition parties. But both the New Democrats and Progressive Conservatives say they oppose any new levies.

The Pembina Institute, a clean energy think tank, calls the development of funding tools a crucial next step for transit expansion in the region.

``The reality is that municipalities can't finance a project on the scale of the Big Move, which requires $2 billion per year, from current revenue sources. Nor can the provincial government, given its current fiscal constraints,'' said the institute's Ontario policy director Cherise Burda in a statement.

``Without substantial investment in transit, the congestion in North America's fourth-largest city will only get worse as the region's population grows... It's no longer a question of `if' we need revenue tools. It's a question of how political leaders can work together to implement them in a fair and effective way.''

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