Parking congestion at Toronto’s Yorkdale Mall. In response to Metrolinx’s recent report, leading voices from Canada’s real estate industry say that a parking levy on free parking would be a hidden tax payable by tenants of shopping centres, offices and industrial facilities and not by users.Charla Jones/The Globe and Mail
The real estate industry, one of the largest proponents of bolstering Ontario's transit system, is coming out fighting against parking charges that have been recommended as a means of paying for improvements.
A number of major industry groups have banded together to argue against new parking charges, and intend to make their case public Friday morning. They include the Real Property Association of Canada, the International Council of Shopping Centres and the Building Owners and Managers Association of the Greater Toronto Area.
"We are 100 per cent in favour of investment in this city and the region," says Michael Turner, the president of the Greater Toronto chapter of NAIOP, the commercial real estate development association. But the group wants a more equitable mechanism for raising the funds to invest in transit, one that would include a greater cross-section of participants, he says. The real estate industry feels that a parking tax leans too heavily on commercial property developers to pay for improvements that will be enjoyed by the region as a whole, Mr. Turner suggests.
The strong reaction comes after the province's Metrolinx transit agency released a highly anticipated report this week with suggestions for raising money to pay for a massive revitalization and expansion of the transit system. Premier Kathleen Wynne wants to go forward with a $34-billion strategy to bolster transit in southern Ontario, and Metrolinx's ideas to raise funds for the projects include a 1 per cent HST increase, a gas tax and the parking charges. The government will now study such options – and hold consultations – before making decisions.
Mr. Turner says his group does not oppose, for example, sales tax increases. But it is adamantly opposed to the parking levy. "First of all, it's double taxation," he says. "The value of parking stalls are already accounted for in the assessed values of the property," and property tax is therefore paid on them, he notes.
The suggested parking tax would likely apply to off-street non-residential parking at an average rate of 25 cents per parking spot per day, REALpac noted, adding that in its view the tax unfairly targets only one industry.
"We support efforts by the government to improve transit," says REALpac chairman Stephen Taylor. "However, when it comes to funding, everyone should be treated equally and fairly."
The industry also argues that the levy will be a "hidden tax," paid for by the suppliers of parking and their tenants – such as shopping centres, offices and industrial facilities – rather than users, and will therefore have no impact when it comes to encouraging individuals to use transit or reducing congestion.
The levy would apply only to non-residential commercial properties, and other buildings such as condos, hospitals and schools would be exempt, Mr. Turner says. "It targets a very narrow segment of the business community – commercial property owners," he says.
Patti Parente, chairwoman of government relations at the International Council of Shopping Centres, said that the various real estate groups will continue to work with the government toward obtaining better dedicated transit funding.
"A parking tax unfairly targets a select segment of the economy which is grossly punitive and will do nothing to alter driving behaviour," she says.