NEWS
11/01/2011 06:17 EDT | Updated 01/01/2012 05:12 EST

Toronto Committee Approves Sale Of Enwave, Defers Toronto Hydro

CP

Toronto's powerful executive committee has decided to put off one part of a controversial plan to sell off some of the city's most valuable assets as a way of easing the municipal debt load.

At a meeting on Tuesday the committee decided to approve a recommendation to sell the city's stake in Enwave Energy Corporation, but defer another to sell off a percentage of Toronto Hydro.

Before the meeting Mayor Rob Ford made it clear which way he was leaning when he told reporters the city was sinking under "$2-billion in capital debt."

"We have to look at ways of getting revenue. And just looking at it right now ... 10 per cent of [Toronto] Hydro is one of the ways," he said. "We have to pay this off."

City staff said selling off a 10 per cent stake in Toronto Hydro along with the city's 43 per cent stake in Enwave — as well as getting rid of some city-owned property — could bring in $600 million.

The money could then, in turn, be used to pay for capital projects like roads, sewers and streetcars.

Coun. Gord Perks said the sell-off would be "fiscal suicide."

"The smartest fiscal strategy is to hang on to things that are generating a lot of revenue for you, so that you can cover the cost of borrowing to pay for the things you need to build," he said.

But Coun. Denzil Minnan-Wong said the proposal makes sense.

"We're making a decision to sell-off only 10 per cent [of Toronto Hydro], and that's it. Period. Full stop."

He said selling off a money-making operation is only logical.

"I suspect the private sector would not be interested in buying any assets that don't make money," he told reporters at city hall. "And so the reality is if we're looking at monetizing an asset the private sector is going to want something for it - a return on investment."

Tuesday's vote by the executive committee will defer any decision on the sale of Toronto Hydro until 2012.

Full city council must approve any decisions.