“What I advocate are leases, so at the end of the term the provisions of the lease are such that the asset returns to the lessor (the city) in the same condition as when it was leased,” he said. “I don’t advocate outright sales for municipalities when it comes to their assets.” Toronto Star
Should the City of Toronto privatize its assets?
February 10, 2010
Toronto has some lucrative assets including Toronto Hydro, land above TTC stations and a parking authority. Recently, though, its been considering “selling” these assets to private owners. Why am I using quotation marks?
The man chosen for the job, Dana Levenson, worked on privatizing many of Chicago’s assets and he does not advocate SELLING the assets, but rather leases that run for decades. As Levenson stated in the Toronto Star:
Some of the benefits of such a political move would be to increase the cash flow now for other infrastructure projects, limiting the risk taxpayers take on concerning future revenue of these assets, and there’s definitely a ready market for purchasing these assets.
So what’s wrong with the deal? Chicago residents have complained about lower quality services in some instances. In addition, some complaints have been made about increases in the price of the services as well. Finally, what about the long-term benefits of the City knowing that it will have an annual cash flow of profits from assets such as Toronto Hydro?
Hmm…I guess the city will have to have a big think about this one. It seems like a difficult decision. Any thoughts?