TORONTO (July 4, 1991) - In a three-page letter challenging Ontario Premier Bob Rae to justify his support for the lack of democratic representation within provincially-mandated Business Improvement Areas (BIAs), Freedom Party leader Robert Metz strongly urged Rae to repeal Section 217 of the Municipal Act.
That's the section of provincial legislation which grants municipal governments the nondemocratic mechanism to establish BIAs in designated business areas. Once designated within such an area, merchants and businesses within the area are forced to pay an additional tax - a BIA TAX - on top of their already existing property, business, sales, and income taxes.
While Ontario municipalities have, over the years, established hundreds of BIAs across the province, provincial legislation specifically denies democratic rights to "members" of a BIA. Though conscripted "members" must pay an additional tax, they are not guaranteed representation of any sort whatsoever, yet are invariably misled into believing otherwise.
As a consequence, it is not until
an inevitable BIA funding crisis, disastrous outcome of a BIA project, or
a conflict with the objectives of a
municipal council that has its own
plans for BIA tax revenues, that
"members" first learn they do not
actually have any guaranteed voting
rights.
Metz's challenge to Rae was precipitated when Fp supporter Pat Pleich forwarded him a copy of a May 8, 1991 letter by Rae to herself, in connection with the Clarkson BIA in Mississauga. In that letter, Rae incorrectly suggested to Pleich that the BIA issue "is a municipal issue," (despite the fact that BIAs are creations specifically of provincial statute) and falsely implied that the democratic process within BIAs was adequately safeguarded.
"Your letter to Ms. Pleich incorrectly suggests that 'a number of checks and balances exist in the legislation to ensure political accountability,"' responded Metz. "(Yet), your own argument confirms (that) 'the Board of Management is appointed by council' and that 'the municipal council has the sole discretion to repeal the by-law establishing a BIA."'
To support his case that resolving the lack of democratic process within a BIA is a specific provincial responsibility (since it is provincial legislation which dictates this fact), Metz forwarded Rae a copy of a June 13, 1989 letter describing the nature of BIAs written to the Law Society of Upper Canada by then City of Mississauga Solicitor Bruce E. Thom.
Referring to Mississauga's Clarkson BIA, Thom wrote: "The Clarkson BIA is a creature of statute: specifically, Section 217 of the Municipal Act. You will note that by Section 217(6) thereof, Council appoints a Board of Management; it is, in fact a Local Board of the Council.... Although the BIA is not a democratic process (whereby every assessed owner gets a vote), the Clarkson group have proceeded to some extent as if that was the case.... In fact the Board of Management is the BIA and the general group simply forms the tax base."
Using the Clarkson BIA as an example, Thom's letter went on to explain how even though a BIA membership may have 'voted' a 'Constitution' in place, "it has no legal effect, since it deals with a group that does not exist in the legislation..."
With Thom's enclosure included with his covering letter to Rae, Metz argued: "Mr. Rae, I can think of no clearer evidence at your disposal to encourage you to take action and to correct this gross injustice. As Mr. Thom explains, BIAs are a 'creature of statute; specifically, Section 217 of the Municipal Act.' As a consequence, I encourage you to reconsider your tacit approval of BIAs on the simple grounds that they are coercive, non-voluntary, and that democratic representation within the operation of BIAs simply does not exist."
In his two-paragraph response to Metz dated September 10, 1991, Rae completely avoided the issue as outlined above by once again falsely informing Metz that "You can address any dissatisfaction with a BIA through the municipal council, since a BIA is directly accountable to it." Rae suggested that if a new business does not wish to belong to a BIA, it may locate in an area where there is no BIA.
Needless to say, Rae's preprogrammed response offers us only two possible interpretations of his stand on BIAs: (1) he is completely incapable of understanding or addressing the issue, or (2) taxation without representation is fine by him. Either way, unwary victims of BIAs will not find a friend in Rae.
GET THE DETAILS! Copies of the correspondence referred to in this article are now available to Fp members and supporters on request.
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last updated on April 28, 2002
