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Toronto Port Authority, City of Toronto, Toronto Star
The other side of the story
By Gary Reid
Thursday, June 21, 2007
The Toronto Port Authority (TPA) held its annual meeting recently, noting a $6 million loss, and brought out the usual knee-jerk reactions in the mainstream media. The Toronto Star called for its disbandment and replacement with some fuzzy panel of federal representatives and city politicians that will never work. The city doesn't even bother to send a representative to the current board of TPA – that's how engaged it is.
The Star says,
"Few public agencies are more consistent than the Toronto Port Authority. Year in and year out, it manages to lose a barge-load of money while performing relatively minor tasks around the harbour. There is usually some turnaround plan in the works. Millions are spent, followed by failure and excuses from high-paid port authority officials…
The port authority, incorporated in 1999, has had ample time to show it can become an efficient operation that, while not necessarily making money, at least doesn't continue to lose a bundle year after year."
If you substituted the city of Toronto for the Toronto Port Authority in the first line, these paragraphs could just as easily be applied to the city. When was there a time limit placed on the amalgamated city to achieve financial self -sufficiency? The TPA, at least, must be reviewed by the Minister of Transport Canada every few years with respect to its financial soundness to comply with the Canada Marine Act. And it has had those reviews and passed muster.
Who holds the city of Toronto accountable for its annual financial shortfalls that amount to hundreds of millions of dollars?
The TPA currently carries a debt load of around $13 million, while the city's is a staggering $2 billion. The city annually spends more on councillors' offices than the loss incurred by TPA. And this is the body that the Star thinks can manage the harbour cheaper?
The costs for the services performed by the TPA will still be there even if it is not, and the city has proven time and again that it cannot manage its operations on a leaner and less costly basis. I feel quite comfortable in predicting that the more the city involved itself in harbour operations the more the red ink would flow.
On the issue of accountability, another big one with the Star, the citizens of Toronto must be very satisfied with the city's dismal financial record since they keep voting in the same drudges, spendthrifts and windbags who have maintained this financial disaster for the past nine years. Why should this public be concerned about the piddling losses of the port authority?
The Star claims,
"Toronto is a relatively minor commercial port and does not require a federal agency to provide simple services such as dredging, unloading occasional cargo, operating a marina and running a sleepy island airport.
Toronto's port operation is so small it routinely moves less tonnage than Goderich on Lake Huron, which has a population of 7,600."
This is the favourite argument of those who don't know anything about the ports business. The port of Goderich is an export port, shipping mainly one bulk commodity, salt. Bulk products are worth only a few cents a tonne to ship and receive. The salt export provides little value added economic benefit for the town. But even Goderich operates its tinker toy port with a separate port corporation.
The port of Toronto is an import port, serving the south-western Ontario hinterland. It receives Goderich's salt, other bulk commodities, containers and general cargo. In 2000, TPA commissioned an economic value study that pegged a figure of over $400 million annually attributable to the various port activities in Toronto, even though the port operator gets only a small slice of that.
Hamilton, the largest cargo port on the Great Lakes, takes in around 12 million tonnes a year (nearly six times Toronto's tonnage figures) of mainly bulk cargoes, primarily feeding the steel industry, and earned only $2.2 million from that in 2006.
TPA's real money is made in attracting high-value added cargo from all over the world. In 2006, TPA took in $5.34 million from its port operations, more than twice Hamilton's revenue, on a tonnage volume only one-sixth of Hamilton's.
With respect to administrative costs, in 2006, the port of Hamilton spent $5.7 million compared to Toronto's $3.7 million.
When we get to the subject of the failures of TPA initiatives, we get this pants dropper from the Star:
"Yet the port authority has always had big dreams. From a proposed island airport bridge, which was never built, to construction of a terminal for the doomed Toronto-to-Rochester ferry, this agency's plans have repeatedly failed."
Wow! You would think the city of Toronto had absolutely nothing to do with this. It was the mayor, David Miller, who single-handedly engineered the destruction of the bridge project, and who, using his bully pulpit to unfairly accuse the TPA of "not doing its job", forced the port authority to unwisely build a permanent ferry terminal before the market for such a service was established. These failures, which cost the TPA and the federal government $45 million, can be laid squarely on city hall.
Finally, the Star reverts to the old shibboleth that the Toronto City Centre Airport (TCCA) is really just a "sleepy country airport" and that Porter Airlines is probably not going to succeed where others failed. Air Canada operated its subsidiaries out of TCCA for decades, without failing, and ever since the advent of Porter has been fighting the TPA to get reinstated through expensive and frivolous court actions.
Air Canada is not fighting to establish routes out of the Goderich municipal airport -- a genuine sleepy country airport,
Gary can be reached at: letters@canadafreepress.com
