September 14, 2012
Glenn Miller, Vice President at the Canadian Urban Institute, explores the challenges facing Canada's cities amidst the wave of urban revival.
By the numbers, Canada is one of the most urbanized countries in the world, with 82% of the population classified as “urban.” Compared to the heralded turning point reached in 2010 when the world’s population living in cities surpassed 50%, Canada is very urban indeed.
Recognition that the country known around the world for Mounties and mountains is an “urban nation” is relatively recent, however, belying the reality that Canada surpassed the 50% urban benchmark during the Great Depression. Debates about “Canada’s urban agenda” only began in earnest in the 1990s when municipal leaders realized that cities lacked the fiscal muscle to replace aging infrastructure (let alone afford new infrastructure!). A principal reason for this is that in Canada’s federal system, municipalities are “creatures of the province,” so the federal government has no direct statutory role in funding cities, and municipalities rely primarily on property tax revenues to pay the bills. There are also strict limits on taking on capital debt, and operational deficits are not permitted. To quote a former Federal minister, “Canada’s cities are operating with a governance model conceived in the horse and buggy age.”
To frustrated mayors in Canada’s larger cities, the disconnect between the challenges of fulfilling the responsibilities of city building in the last decade of the 20th century and the fiscal powers available to municipalities were – and are – a source of mounting concern. Federal funding for infrastructure thus became a convenient issue to focus the debate on the urban agenda, in part because it could be argued that high quality infrastructure is essential for urban competitiveness, which in turn benefits the federal treasury. Although much ink was spilled trying to accurately determine the true size of the infrastructure deficit – the gap between need and the ability to pay – this soon became a moot point when it became clear that any large amount would be unaffordable.
The Urban Agenda debate changed the conversation about cities
Big issues need champions and one of the most articulate advocates for giving cities the tools needed to succeed in a global economy was Winnipeg mayor Glen Murray, a confidant of renowned urbanist Jane Jacobs. Together they created the C5 – comprising the mayors of five large Canadian cities – a group funded by philanthropist Alan Broadbent to educate the public about the plight of municipalities and persuade the federal government (among other things) to recognize municipalities as a distinct order of government. Their lobbying had an impact, although not necessarily the desired one.
A dissenting voice in this debate was former Toronto mayor and federal cabinet minister, David Crombie, who cautioned against relying too heavily on federal largess. Although he agreed that cities do indeed require more fiscal autonomy, he argued that these arguments should be heard and understood by provincial leaders, not federal. This viewpoint was most likely formed during his popular mayoralty in the mid-1970s, a period that coincided with the brief existence of a Ministry of State for Urban Affairs.
The “win” resulting from the C5 pressure placed on Paul Martin’s Liberals in the late 1990s was at best a tie – with the federal government agreeing to grant municipalities a share of gasoline tax, although the amounts were nowhere enough to address the infrastructure deficit. As Crombie predicted, this concession to municipalities subsequently weakened pressure on the federal government to support cities financially in a more direct manner, leaving unanswered serious questions about the capacity of cities to cope with the challenges of funding growth.
Hope for reviving the “urban agenda”?
The situation changed quickly in 2008, however, when a new Conservative government was forced to address the impact of the global financial crisis on urban economies. The government’s rapidly conceived “Building Canada” program, negotiated bilaterally with each province, set aside significant capital funds for local infrastructure projects, which were then assigned on a competitive basis to municipalities, with the requirement that they be completed by 2014.
Then last year, the federal government announced that when the current program expires in 2014, the Building Canada program will be replaced by a long-term infrastructure plan. This end date has provided a new focal point for lobbying efforts, aimed primarily at Infrastructure Canada. The deliberations are being led by the Federation of Canadian Municipalities, and a large group of urban stakeholders such as the Canadian Urban Transit Association, construction unions and the like.
The narrowness of the debate underscores the reality that Canada lacks national entities with a mandate to develop urban policy at the national level. The role of Canada Mortgage and Housing Corporation, for example, has been steadily reduced in recent years and the corporation’s strong research agenda focused on sustainability was axed in the most recent round of federal cost cutting.
Funding challenges are complicated by regional governance issues
The experience of the Greater Toronto Area – Canada’s largest urban region – is instructive. In the mid-1990s, an independent task force convened by the province recommended a new regional governance model to manage the many complex issues facing the fast-growing Greater Toronto area. The prospect of a regional government overseeing some 30 local municipalities, spanning more than 700 square kilometers and accounting for more than 60% of the provincial GDP, proved to be politically unpalatable. The problem of a mismatch between scale and responsibility has been a challenge for the handful of other regional agglomerations elsewhere in Canada. Planning, funding and implementing rapid transit schemes and other major infrastructure investments at the regional scale necessary to get the job done is extremely difficult when so many municipal boundaries have to be crossed, although Metro Vancouver has come close to getting it right.
In Ontario, the solution chosen by a newly elected provincial government under Liberal Dalton McGuinty was for the province to re-engage on regional planning issues, although to be fair, the first steps had already been taken by the previous government. The resulting Growth Plan for a massive chunk of Southern Ontario dubbed the “Greater Golden Horseshoe,” released in 2006, establishes where growth should occur and at what levels, while companion legislation dictates where it may not take place. Although the plan has been justly praised as visionary, the ambitious scope has highlighted the limitations of implementing policy that requires not only a shift in culture but also needs to be supported by unprecedented levels of capital investment in urban infrastructure like higher order rapid transit – a considerable challenge given the current economic conditions. But the plan has survived long enough to undergo its first statutory review, and important concepts like Transit Oriented Development appear to be winning more supporters than detractors these days.
Global trends also have an impact on how cities operate
In an age when the rate of urban growth is a concern globally – essentially confined to cities in the developing world – Canada’s relatively small – but heavily urban – population of less than 34 million is not only tiny but also a cause for concern. Even though the country’s growth rate is the highest among G8 countries – due to high levels of immigration – forecasts suggest that by 2050 Canada’s population will still only be about 40 million. In global terms this is a rounding error.
Although few would argue that growth is desirable for its own sake, there are obvious links between population and our ability to create the wealth needed to support our aspirations. We essentially have the same urban framework that existed at the time of Confederation in 1867, with only nine census metropolitan areas with populations larger than half a million. In contrast, our neighbour to the south has more than 30, offering an order of magnitude more opportunity for innovation and economic choice.
Like many developed countries, Canada’s population is aging, and the rate of increase in the average age of the population is sufficiently high to have attracted the attention of the OECD, which has expressed concerns about our capacity to handle a massive increase in the seniors population. The prospects for a country where the number of people beyond retirement age exceeds the number of school age children – a real prospect as early as 2031 – suggests that our “dependency ratio” of citizens paying taxes to the number of citizens consuming government resources – is genuine cause for concern.
An obvious issue in this regard is immigration policy – are Canada’s cities likely to continue to attract new immigrants at an optimal rate, and will we be able to maintain the size of our labour force at competitive levels? The jury is out on this question because recent experience suggests that the country’s lauded success in creating one of the world’s most ethnically diverse populations may be fraying at the edges. The situation is complex, but some reports suggest that new immigrants – often highly credentialed – are finding it harder to prosper economically than in the recent past.
Downtowns are resurgent – a promising trend
To close on a positive note, however, it would appear that Canada’s downtowns are enjoying a revival. According to a recently published Canadian Urban Institute study on the subject, there is a strong connection between vibrant downtowns and economically successful cities. A review of 10 cities of different sizes (selected from Victoria on the west coast to Halifax in the east) documents a track record of collaborative, strategic investment in downtowns across Canada that is feeding into what may well be a North American-wide phenomenon – the re-urbanization and re-population of central cities. The study describes a range of approaches to supporting downtown growth, but the common denominator appears to be that continued success over the long-term depends on a model of shared leadership involving public, private and third sector engagement.
As Canada’s larger urban areas expand, considerable effort is being expended on creating “new downtowns” – essentially finding ways to “put the urban in suburban.” This is a focus of Ontario’s Growth Plan for the Greater Golden Horseshoe and is also a feature of planning efforts in other regions. The suburban downtowns being “grown” in Metro Vancouver are a good example of city building in 21st century fashion.
Canada is definitely an urban nation with challenges ahead, but the spirit of revival is squarely where it needs to be – within the diverse range of institutions that collectively contribute to a city’s overall competitiveness. Our next challenge is to devise innovative ways to fund physical infrastructure and support continued investment in human capital commensurate with the country’s aspirations for sustaining the high quality of life enjoyed in so many Canadian communities.
Glenn Miller, FCIP, RPP, is vice president, education and research, with the Toronto based Canadian Urban Institute. David Crombie and Glen Murray have both served as president of the Institute. David Crombie currently heads the Toronto Lands Corporation and Glen Murray is Minister of Colleges, Training and Universities in the McGuinty government.
Recent projects undertaken by the Canadian Urban Institute include:
• The New Geography of Office Location and the Consequences of Business as Usual in the GTA, 2011: https://canurb.org/sites/default/files/reports/2010/TOC_CUI_Report_April2011.pdf
• The Value of Investing in Canadian Downtowns, 2011/12: https://canurb.org/story/2012/05/16/new-cui-report-value-investing-canadian-downtowns
• Integrated Energy Mapping in Ontario Communities, 2010: http://canurb.org/iemoc
• Re-Positioning Age Friendly Communities: Opportunities to Take AFC Mainstream, 2011: https://canurb.org/sites/default/files/reports/Re-PositioningAgeFriendlyCommunities_FinaltoPost_April2012.pdf
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