Municipalities: Where the Action Is
The Empire Club of Canada Addresses (Toronto, Canada), 20 Mar 1969, p. 231-245
McKeough, The Hon. W. Darcy, Speaker
Media Type
Item Type
Concern for the changes taking place in municipalities. The shifting of population to urban and suburban areas; rapid growth; changes in land use; new concepts of living and the problems they cause. The responsibility and authority of the Provincial Government to take action. Some fundamental solutions taken. The need for large-scale, long-term solutions. Spelling out the Ministry's concept of the type of solutions required, and beginning the action to implement them. Proposals for a complete overhaul of the municipal system. Three major thrusts, each of which is discussed: Reform of Local Taxation; Reform of Provincial Aid to Local Government; Reform of Local Government Structure. Further discussion is offered under the following headings: Regional Government Progress; The Metro Toronto Area; Planning; Internal Municipal Structure; and Conclusion. A welcome for ideas and suggestions.
Date of Original
20 Mar 1969
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Full Text
MARCH 20, 1969
Municipalities: Where the Action Is
CHAIRMAN The President, Edward B. Jolliffe, Q.C.


I am happy to say that our guest today definitely qualifies as one of the younger generation, although he is within shooting distance of the older, because he recently attained the ripe old age of 36 years. He has been a member of the Legislature since 1963, entered the Cabinet at 33 and became Minister of Municipal Affairs in November, 1967. In that capacity, he is at the very centre of great changes which are now in the making with regard to the financing, structure and organization of municipal government in this province.

Ontario is proud of the pioneer work it has done in municipal self-government since before Confederation. The family of the Honourable Mr. McKeough has long been associated with its evolution; he is the sixth member of the family since 1847 to hold public office in Chatham.

He himself was committed very early. After graduating from the University of Western Ontario he served on the Chatham City Council from 1959 to 1963, and also on its Planning Board and the Lower Thames Valley Conservation Authority, as well as in many other organizations, while at the same time he was Managing Director of his own business.

It would now appear that although Ontario's population has grown by leaps and bounds, its local authorities, of which there have been several thousand in more than a thousand municipalities, are to dwindle in number as we develop into a predominantly urban society. Nobody knows more about this than our guest. I now introduce to you, to "set the record straight," the Honourable W. Darcy McKeough.


One of the most popular subjects today for all kinds of communication is the subject of change. In coffee klaches and in formal speeches, in bull sessions and in seminars, we marvel at the fact that things aren't the way they used to be--that they are getting less like they used to be at such a remarkably rapid pace. We talk about significant changes in the way we live and the way we work, in our homes and our communities, in the world and now, of course, beyond the world.

It is one thing to talk about change, as all of us do. It is quite another thing to go out and meet it; to leave the shelter of established tradition and to become a partner of change, looking for new ideas and ready to act on them. For government, as for business, a measure of effectiveness is our success in meeting change with sound and positive action.

My particular concern as Minister of Municipal Affairs is the changes that are taking place in municipalities. The shifting of population to urban and suburban areas, exceedingly rapid growth, changes in land use, new concepts of living--all of these developments, and many more that accompany them, are well known. So are the problems they create.

In relation to these changes and problems, the Provincial Government is in a unique position. We have the responsibility, and the authority, to take action. Others may theorize and point with alarm; we have to make the decisions for action.

It goes without saying that government action must be keyed to changing circumstances. And it is dependent on public opinion and support. The crisis in the municipalities has been building up for many years, and government action has built up accordingly. We have introduced a variety of measures. For the most part, these have been grants, subsidies and other forms of financial support. The Province now pays nearly half the cost of the services and functions that are administered by local authorities. In other words, the local bodies collect only a little over half their budgets through local taxes; the rest of the money is raised by the Province from its broader tax sources.

But as the municipal crisis became more widespread and more severe, particularly in urban areas, it became clear that the methods of the past are just not good enough. In our judgment, too, there is a growing public awareness of the need for new and more fundamental solutions.

In 1968 we adopted two further measures that had been recommended by the Ontario Committee on Taxation. One was the assumption by the Provincial Government of the administration of justice; the other was the introduction of Property Tax Reduction for virtually all home-owners and tenants in Ontario. These measures are shifting about 150 million dollars a year from the municipal tax base to the provincial tax base. They are easing the squeeze substantially for the time being, but they were never intended as total or permanent solutions.

Our municipalities are facing a large-scale, long-term crises. To meet this they need large-scale, long-term solutions.

In recent months we have spelled out our concept of the type of solutions required, and we have begun the action to implement them. In late November and early December, Premier Robarts and I presented statements to the Legislative Assembly outlining our policy on regional government and local government structural reform. These two statements, together, form a White Paper which we have called "Design for Development, Phase Two." Earlier this month in his budget statement and accompanying White Paper, the Provincial Treasurer outlined some of the financial reforms necessary to re-establish effective local government in Ontario.

It is my belief that these statements, taken together, represent one of the most significant documents of this century for the people of Ontario.

What we are proposing is nothing less than a complete overhaul of the municipal system--the most dramatic and far-reaching series of changes in 120 years, since the Baldwin Act and the assessment Act of 1849. There will be three major thrusts:

1. Reform of local taxation.
2. Reform of Provincial aid to local governments.
3. Reform of local government structure.

Reform of Local Taxation

The cornerstone for the reform of local taxation is a reform of local assessment.

If assessment is unfair, then the municipal taxes--which are based on that assessment--will be unfair. In fact, and beyond any doubt, assessment in Ontario is unfair in many ways. It is deficient in many ways. Therefore, we have undertaken important basic changes in the assessment function.

We are transferring the administration of assessment from the municipalities to the Province, effective July 1 in some areas and next January 1 in the remainder of Ontario. We will establish uniform standards to replace the present patchwork of differences and inconsistencies. We will place assessment on a basis that is more equitable to all taxpayers. To do this, we will assess at market value and we will maintain assessment at market value.

Assessment has tended to be a neglected area for a number of reasons. Our task now is to correct the results of more than a century of neglect and low priorities.

Perhaps I should clarify one point about our plan, since everyone will be affected by it. That is the intention of assessing all properties at market value. For most municipalities this will be a major change. Studies done by the

Assessment has tended to be a neglected area for a year, 868 of 964 municipalities were assessing at below 40% of market value.

We are convinced that assessment at market value permits the maximum accuracy and the maximum fairness among all taxpayers. This does not affect the level of local taxes, of course, except to correct cases of unfairness.

This modernization of property assessment is the essential cornerstone upon which a modern financial system can and will--be built.

Reform of Provincial Aid to Local Government

The second thrust in the plans by the Province to reform our municipal system relates to Provincial aid to local governments.

As I have indicated, this aid is already substantial, and it is continuing to increase. As a short-run measure, property tax reduction is being continued in 1969 as the best method now available to provide direct assistance to householders both home-owners and tenants--in order to ease for them the burden of the property tax. We are raising the average level of Provincial support for elementary and secondary education from 45% to 60% over a three-year period, and improving our system of unconditional grants. Overall reform of the present subsidy system, however, to the maximum benefit of the municipalities and of individual citizens, depends in large measure on reforms in assessment and in municipal structure. These three thrusts of change must all go forward together.

Reform of Local Government Structure

The third major action in our overhaul of the municipal system is already under way, and I'm being cussed and discussed in many parts of the province because of it. Including, I might say, the part of the province where I am now standing. I'm referring to regional government.

In many areas the existing local governments are not able to cope with the speed and the magnitude of the challenges that face them--challenges that involve population growth, changing patterns of urban and suburban areas, huge and expensive problems of providing water lines and sewers, traffic jams so severe that they have a serious impact on the economy and so on.

In such cases, where the needs of the people can only be met by a drastic change in municipal structure, my Department takes the initiative in proposing the establishment of a regional form of government.

Regional government, where and when necessary, has four fundamental aims.

The first aim is to make local government stronger. Over the last generation--and particularly since the end of World War II--there has been a trend away from local government in major decision-making. Local responsibilities tend to become greater than local powers and finances can handle.

It is our intention to reverse this trend by creating new units of local government that are strong enough to make the meaningful decisions associated with the responsibilities they have been given.

The second aim of regional government is the establishment of a municipal structure that makes it realistic to re-examine the existing division of responsibilities between the Province and its municipalities. There are many things now being carried out by the Province which could be done by a stronger municipal structure. For example, in my own Department, some of the detailed planning approvals now made at Queen's Park could be done by a Regional Government Council.

A third aim of our programme is fiscal equalization. One of the biggest problems in local government is fiscal imbalance. The financial capacity of a municipality is based almost entirely on the property which happens to be within its boundaries--and this is not necessarily related to the demand and need for municipal services. Regional government will help redress this imbalance because assessment in a region will be pooled to provide regional services.

The fourth aim of our regional government programme is to return as much decision-making power as possible to the elected municipal council at the regional and local levels. Many local boards, commissions, committees, etc., make their decisions--policy and financial--quite independently. It is our belief that the elected regional or local municipal council should be the chief instrument of policy co-ordination for most local government functions. In order to achieve this augmented role for elected municipal councils we see the need to strengthen the municipal structure.

The Bureau of Municipal Research has come to the same conclusion in its excellent paper on special-purposed bodies in Metropolitan Toronto. Bodies of this kind can render excellent public service, but that fact does not override the principle that it is highly desirable for people who make decisions on public matters to be directly responsible to the electorate.

Regional Government Progress

In order to give you an idea of how regional government is shaping up in those areas where we are moving ahead on a high-priority basis, here is a list of what is now being done:

- Ottawa-Carleton: regional government came into operation on January 1 of this year.

- Niagara: I presented a proposal for regional government in the Counties of Lincoln and Welland on January 23rd. I hope to be in a position to introduce legislation within a few weeks, and to have regional government in that area come into effect next January 1.

- Hamilton-Wentworth: public hearings by a local government review commission have begun and a final report should be in my hands by the end of this year. This report will be taken into account when we make an early decision on regional government for that area.

- Kitchener-Waterloo: a local government review commission report will be made very shortly. After we study this report, I will make a regional government proposal for the Kitchener-Waterloo area.

- Haldimand-Norfolk: On Monday of this week I spoke to the municipal councils of the Counties of Haldimand and Norfolk. As you know, a major new industrial complex is to be erected on the Lake Erie shore almost exactly on the border between these two counties. We will work with the Counties in preparing a development plan for the area, and we will also co-ordinate Departments and agencies in the implementation of this development plan. In addition, I expect that a regional government proposal, based on the findings of this plan, will be made to the affected municipalities.

This list could go on at some length since there are many other areas in which some form of study or discussion is in process, either in a preliminary or advanced stage.

The Metro Toronto Area

You will have noticed one very important area that I omitted from that list--the area that converges on Metropolitan Toronto. In terms of urban pressures and local government reform, this is the centre of where the action is. Events here are moving at a quickening pace. There is a certain amount of controversy as divergent opinions are expressed, and that is a healthy development. An interested public is most desirable when changes in structure are being worked out.

On the three sides of Metropolitan Toronto, proposals for regional government are now being generated.

To the West, I have made a preliminary proposal for regional government in the Counties of Peel and Halton. You will recall that a review of the local government structure in this area was completed two years ago. However, we could not accept the recommendations of this review because it called for a distinct separation of the area into two regions--one rural and one urban. Our view is that the division of urban and rural economies is a method of the past. My proposal suggests one regional government covering both counties and a small part of Dufferin County around Orangeville. This preliminary proposal will now be studied by a committee representing the municipalities in the proposed region. I shall be holding my first meeting with this committee tomorrow.

North of Metro Toronto there has been considerable discussion among municipalities in York County on both regional government and municipal consolidation. I shall be presenting a preliminary proposal for discussion purposes on April 1.

On the East side of Metro a novel and different approach is being used. On its own initiative a group of municipalities has begun a planning and development study covering Ontario County and part of Durham County. This will be a broadly-based study, looking at the economic population and developmental patterns and projections for the area, leading to a series of recommendations covering subjects such as transportation, land use and the machinery of government. I expect that this will lead to a regional government proposal for the area. The municipalities will be meeting with some of my colleagues and myself late this month to seek our technical and financial assistance.

There are many reasons for our proposal for three regional governments to the east, north and west of Metro in preference to the obvious alternative of extending Metro's boundaries. What those reasons boil down to is the best interests of the people. We have studied the experience of urban and suburban areas elsewhere on this continent and in Europe. We have made analyses and projections for the varied factors of growth and development in the Metro area. Our conclusion is that the long-range quality of living in this part of Ontario will be best served by the divisions I have outlined.


How about planning?

That is a question that has been asked a good deal in the last few weeks. It is a fair question and it has a logical answer.

To place this subject in context, let us recall the background of the Metro Toronto Planning Area and Board.

In 1953 the Province made two major decisions. One was to establish the Municipality of Metropolitan Toronto. The second was to define the Metro Toronto Planning Area. This planning area is, under the Planning Act, a joint planning area. It encompasses a number of municipalities in a partnership set up to study and make recommendations regarding growth and change within its limits. The planning area consisted of 26 local municipalities, 13 inside Metro Toronto and 13 outside in York, Ontario and Peel Counties. The municipalities outside Metro are formally represented by 6 members (out of 28) on the Planning Board.

The Municipality of Metropolitan Toronto Act, 1953, provided that Metro Toronto be the "designated" municipality for purposes of the Planning Act. This is a technical term that seems to cause misunderstanding for some persons. It is an administrative device to "designate" a municipality under the Planning Act. Such a municipality is not given any special powers, and the Metro Government does not have any special powers in regard to the Planning Board.

In proposing that there be three regional municipalities adjacent to Metro Toronto, I made the statement that the boundaries of the Metropolitan Toronto Planning Area would be re-adjusted to coincide with the boundaries of the Metropolitan Corporation. This statement is consistent with our view that planning must be an integral part of government operations and that, to be most effective, the area of planning jurisdiction and political jurisdiction should be the same. This view regards planning as an essential function that should be really effective, rather than just theoretical; and a function that should bear a close relationship to the people it serves.

Some of the reaction to this proposal has been adverse, as you know. One might get the impression, from some of the comments that have been made, that the doors would be thrown wide open to uncontrolled development in the fringe areas as a result of the reduced size of the Metro Planning Board. Although sound and effective planning was one of the strongest bases for the course I outlined, there have been suggestions that we were anti-planning.

It is obvious that my message didn't come through too clearly. The Province is fully aware of the tremendous growth pressures that must be met and of the urgent need to prepare plans to accommodate this growth. The Metropolitan Toronto and Region Transportation Study is an obvious example of our concern. The reports of this far-ranging Provincial study, released last June, provide a springboard for informed and responsible planning within the broader Toronto area.

The scope of that study, covering 3200 square miles, was a demonstration of the enlarged area that is subject to the Metro-centred urban pressures of this part of Ontario. At the time the Planning Board was established in 1953, a planning area of 720 square miles seemed sufficient. But as circumstances have changed, so have the ways of meeting them. For the Sixties--and for the Seventies and Eighties, and beyond--the perspective for planning is much different.

We are not out to spike the guns of the planners.

On the contrary, we're seeking ways of increasing the influence of sound planning. The new system will be designed to encourage comprehensive planning, and to make it far more likely that the plans can be put into effect.

Here is what we visualize:
1. Each of the new regional municipalities will be charged with the responsibility of preparing an official plan under the Planning Act as soon as possible after being established. (This responsibility is already set out in the legislation creating the regional municipality of Ottawa-Carleton.)
2. There will be competent planning staff employed by each of the regional municipalities. Their main responsibilities will be to prepare and maintain an official plan which will set out the broad strategy for growth within the entire regional municipality. In addition, in the case of a two-tier system, the staff will be available to help the constituent municipalities in handling their local development problems.
3. The regional official plans shall be consistent with physical and economic guidelines prepared under the Province's regional development programme.
4. The regional official plans will, in turn, form the framework for the more detailed, and geographically more limited, plans established by the local municipalities.
5. Provincial staffs will maintain close contact with regional municipalities during the period when plans are being prepared in order to ensure adequate communication between regional municipalities, Provincial departments and other agencies.
6. Before the plans are approved by the Minister of Municipal Affairs, as required under Section 12 of The Planning Act, they will be compared with Provincial policies and with the plans and opinions of adjacent regional municipalities. Plans will be consistent one with the other. Co-ordination of the planning carried out by the regional municipalities is an extremely important Provincial function. The existence of rational plans for the regional municipalities will make far less necessary the present Provincial concern about the more detailed plans for individual local municipalities.
7. In Southern Ontario it is impossible to draw boundary lines between regional municipalities in such a manner as to preclude almost continuous dialogue between these municipalities. We must recognize this and provide the legislative and administrative structure to permit it to occur. We see the desirability of regional municipalities getting together to discuss a multitude of issues of common interest. I have already had one preliminary discussion with the Metro Toronto Executive Committee and one with the Metro Planning Board Executive on a number of these points. This is just the beginning. Over the coming months and years there will be many discussions with many people. All viewpoints will be heard; all viewpoints will be given careful consideration.

The timing of the change in the boundaries of the Metro Toronto Planning Area is extremely important. It is my intention not to change the present boundaries until I am assured that the new regional municipalities are equipped by plans, staff and attitude to take over. It is unlikely that the three new regional municipalities will all be in this position for at least three to five years.

The partnership which has existed between the municipalities in the Metropolitan Toronto Planning Area over the past 16 years has been, in my opinion, most beneficial to the Province, the region and the individual municipalities both inside and outside Metro Toronto.

This dynamic agency can have an important role in facilitating the ultimate transfer of responsibilities to the new regional governments. Beyond that time, it will continue to be a vital force in shaping solutions to the challenges and changes of great magnitude that will take place in Metropolitan Toronto.

Internal Municipal Structure

Beyond the concept of regional government, and beyond the role of planning, there is another element that is essential to the success of a reformed municipal structure. That element is the internal administration of municipalities. The best of systems on paper is worthless if the internal administration of municipalities is not equipped to put it into effect. Like everything else in our system of municipalities, the internal structures were created in the distant past. Some municipalities have made changes over the years, and others are concerned at the effects of the mounting pressures and complications, especially in urban centres.

I am convinced that the only way we can avoid the almost insurmountable obstacles faced by some of the large American cities is by making a thorough study of the urban internal municipal structure, with a view to soundly-based innovation.

To this end, my Department has begun such a study. We are examining many forms of structure, including boards of control, executive committees, and the Council-manager system. We will be securing first-hand information from certain municipalities here in Ontario, and we will study related experience in the United States and the United Kingdom.

We do not have the answers to what is the best form of administration for municipalities, particularly large ones. I hope, through this study, that we will establish those answers.


I think it is correct to say that the municipal level of government was regarded, at one time, as rather routine. It seemed to be a place where nothing much changed over the years, except the names and the faces. While the world was transformed by the development of basic things like the automobile, the airplane, and electricity, there was virtually no change in the system of municipal government that was established 18 years before Confederation.

If it seems that a great many innovations are taking place all at once in our municipalities, just remember how long these changes have been in coming. And remember, too, how much is dependent on those innovations--the efficiency of our economy, the climate for enterprise and progress, the quality of personal living.

Right now, municipalities are where the action is. I'm honoured to be in the centre of it. And I welcome all ideas and suggestions that can help us to carry through the specific courses of action that will best serve the future of the people of Ontario.

Thanks of the meeting were expressed by Dr. C. C. Goldring.

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Municipalities: Where the Action Is

Concern for the changes taking place in municipalities. The shifting of population to urban and suburban areas; rapid growth; changes in land use; new concepts of living and the problems they cause. The responsibility and authority of the Provincial Government to take action. Some fundamental solutions taken. The need for large-scale, long-term solutions. Spelling out the Ministry's concept of the type of solutions required, and beginning the action to implement them. Proposals for a complete overhaul of the municipal system. Three major thrusts, each of which is discussed: Reform of Local Taxation; Reform of Provincial Aid to Local Government; Reform of Local Government Structure. Further discussion is offered under the following headings: Regional Government Progress; The Metro Toronto Area; Planning; Internal Municipal Structure; and Conclusion. A welcome for ideas and suggestions.