Council isn't playing fare
Author:
Walter Robinson
2001/11/02
As councillors get set to commemorate their one-year election anniversary, there is no doubt they will trumpet their accomplishments in local community paper columns or at the next community function. Oh sure they'll hold up the mathematical tax cut some of us received or the fact that the O-train is now actually working as testament to their hard work, but what they won't tell you about is the success of the city's anti-business agenda.
That's right, an anti-business agenda. Think I'm exaggerating? Well let's consider the following evidence. The anti-smoking by-law has decimated the bar business in this city. Now don't misinterpret yours truly: the "merchants of death" (read: big tobacco) will not make my Christmas card list anytime in the next millennium.
But council and staff's dogged determination to ram the no-smoking law through and quash any sort of organized dissent through the courts (which is the right of those who oppose the by-law to do so) is having adverse consequences. A canvass of restaurants that I frequent during the workweek or on the odd weeknight yields consistent results, on average business is down somewhere between 15% and 40%. While an argument can be made that the post-September 11th environment and resultant economic shocks are partly to blame, the bar and restaurant owners that I've spoken with saw customers disappear after Labour Day … and they haven't returned.
This brings us to a truism of politics: businesses don't vote, people do. Will the city grind to a halt as some long-standing family run bars and restaurants gradually shut their doors over the coming months? No, we'll survive, but the carpet-bombing style implementation of the by-law (as opposed to a phase-in period over a few months or a year) was a case of a very skewed imbalance between public health and community economic development. And as these businesses vanish, so too will their property taxes which are anywhere between two to six times an average residential property assessment. Guess who'll make up the loss in the tax base? Don't answer: it was a rhetorical question.
Moving on with this anti-business line of thought, let's consider the pros and cons of forthcoming changes to the taxi industry. This file started with the transition board (the Haydon report) and was picked up by the city after last year's elections. Indeed, changes to this industry were long overdue.
To be fair, the city's emergency and protective services committee (chaired by Gloucester-Southgate councillor Diane Deans, not known for a pro-business acumen), is taking some positive steps on this file. Phasing in one-zone for all of Ottawa makes sense. Imposing some standards on tinting of windows, driver training and busting up the black-market that currently exists for taxi plates are laudable and applaudable changes.
But with the good, it seems we must always take the bad when it comes to city council decisions and their impact on business. For example, taxis will not be allowed to be any older than six years. While there is no doubt that there are some real pieces of garbage on the roads with a taxi sign on the roof, this decision ignores the economics of automobiles, the challenges of the industry and practice in other metropolitan centres.
Many drivers buy cars that are one or two years old. Considering that a new car loses 30% of its value as soon as you drive it off the lot, this makes sense. These vehicles are then financed over a five-year period. So quick math tells us that if the vehicle is 2 years old when purchased, and a five-year financing plan is in place, then the driver or owner really can't make a return on the car until it is seven years old. But the city's six-year age limit blows this strategy out of the water.
Council should have - and still can - change this requirement and move it to eight or nine years. Heck, in London, England, they have cabs that are 30 and 40 years old. In Cuba, it's the same story. The real criteria to be considered are cleanliness and reliability, not age.
To compensate for this, the city has approved a 6% fare increase to take effect - if I'm not mistaken - November 19. The meter will still click off in 15-cent increments, but it will do so every 113 metres as opposed to the current 120 metres. And the base rate will jump from $2.15 to $2.25. While an increase may be justified (cabbies have only had one other 6% jump since 1992) to compensate for higher fuel, insurance and other costs, one has to question the timing.
With the economy in recession - don't kid yourself, that's where we are - disposable incomes are diminished. Add to this the fact that many companies are brushing through their expenses with fine the proverbial fine tooth comb, and it can't be a pretty picture in terms of demand for taxis on every street corner. Tourism is also down as evidenced by the longer times cabs are idling outside hotels.
So for all the troubles - both legislative and economic - that have befallen the taxi industry, the city is allowing a fare hike to help recoup costs. Yet, here's the rub. Drivers know a fare hike will drive away already scarce customers, not attract them. Again, it's anecdotal evidence, but given the travelling my job entails, many trips to the airport or train station have been taken in the last few months. And almost without exception, cabbies tell your humble scribe that they'd rather have a little longer window to own their cars (see above, eight or nine years) as opposed to hiking fares.
Could this be another example of a city policy hurting business? It certainly looks that way. Of course council must strike a balance among many competing interests when it considers and passes each policy. But it seems an anti-business agenda has taken hold at city hall. This is all the more surprising because the majority of council (including the Mayor) are self-described and/or seen as centre or centre-right leaning in their political outlook. And you thought Parliament was confusing.