August 25, 1998
TO:Chairman and Members of Emergency and Protective Services Committee
FROM:Carol Ruddell-Foster
SUBJECT:1999 License Fees
Recommendations:
It is recommended that:
(i)The Committee approve the attached proposed schedule of license fees (Appendix 1);
(ii)The By-law amendment implementing the new schedule of fees be effective January 1,
1999 and;
(iii)By-law 20-85 be amended to require an annual check of the exhaust emissions of
Taxicabs, Livery Cabs and Driving School Vehicles, such By-law to be effective January 1,
1999.
Background:
In 1985 Metropolitan Council directed the Licensing Commission to operate at cost
recovery. As a result a cost recovery model was developed with the objective of allocating
the costs associated with administering and enforcing the licensing by-law to the various
categories of licenses. These costs were to be recovered in the form of a license fee or user
fee where applicable.
The cost recovery model was in use until 1993, when at Council's direction it was reviewed
by the Chief Administrative Officer of the former Municipality of Metropolitan Toronto
who reported that "In general terms it [the model] appears to be a reasonable procedure of
estimation of unit cost by license category on a full cost recovery basis."
The report also made the suggestion that general administrative costs should be distributed
in a manner that is more reflective of the actual time and resources spent by management,
administration and accounting activities which support specific classes of license. Further, it
was recommended that administrative and accounting expenditures related to human
resources management be charged to divisions based on the number of staff.
Discussion:
1999 Model - General Comments
The following have been taken into account in preparing the model:
(i) An increase of $200,000.00 in Tribunal costs reflecting the anticipated cost of providing
separate legal services to the Tribunal. This is as a result of the separation of the Tribunal
functions from the administrative functions as approved by Council on May 13, 1998;
(ii)An increase of $165,000.00 in enforcement salaries representing an annualization of an
increase in establishment of strength of six Enforcement Officers, approved in the 1998
budget on condition that Toronto Licensing is given access to the Provincial ICON system
which will enable Licensing to collect fines.
Toronto Licensing has been given authorization to access the Provincial system and is
currently in discussion with the information technology staff of the Ministry of the Attorney
General on the process for implementation.
(iii)An amount of $25.00 has been included in the cost of each Taxicab Owners, Livery Cab
Owners, Driving School Owners and Instructors' (with cars) licences to reflect the cost of an
annual basic exhaust emission check in accordance with Council's direction that "the
General Manager, Toronto Licensing Commission, in consultation with the appropriate
officials, be requested to investigate the possibility of adding to the inspections, at this stage,
the testing of exhaust emissions using the new technologies available for such testing."
The current service provider of mechanical inspections Reg Quinn Ltd. was asked to provide
information on the possibility of including exhaust emissions testing in the current
inspections and the cost and time requirements for such testing. In a letter to the General
Manager, Toronto Licensing Commission, (Appendix 2) Reg Quinn Ltd. indicated that the
technology is available at a cost of between $20.00 to $30.00 per inspection requiring
between 15 to 22 additional minutes per inspection.
For the purpose of the 1999 Fee calculation it was assumed that if Council approves the
inclusion of exhaust emission testing there would be one emission test per year as this
would probably be the standard that would be used by the Province if and when Provincial
testing is introduced.
If annual exhaust emission testing were approved the following actions will be required:
(a)The By-law be amended to include testing exhaust emissions as part of a mechanical
inspection of taxicabs and that the failure of an exhaust emission test be defined as a failure
due to a major mechanical defect. The definition of exhaust emissions as a major
mechanical defect may result in an increase in the number of failures and in turn the number
of Tribunal Hearings. A similar amendment should be made in the schedule relating to
Driving School Vehicles.
(b)Licensees in the affected categories should be advised of the increased time required for
an inspection and be given information on the benefits of clean emissions.
(iv)Council at its meeting July 8, 1998 amended By-Law 20-85 requiring that vendors of
alcoholic beverages be licensed effective January 1, 1999. The fees were set at $500.00 per
year. No data is available on the costs of enforcing these regulations or on related costs,
therefore, no changes are recommended.
(v)A report recommending the licensing of Complementary Care/Holistic Therapists was
considered by the Emergency and Protective Services Committee at its meeting July 14,
1998. The Committee referred the report along with some motions back to the General
Manager, Toronto Licensing to report thereon to Committee at its meeting in October.
Among the motions to be considered was a motion that "a fee be established for Holistic
Therapy Centres that reflect the licence fee for Massagists and Massage Parlours" and that
the General Manager "review the licence fee after it has been in effect for a period of time so
that the adjustments that may be necessary can be made". Complementary Care/Holistic
Therapists have been included in the fee model in anticipation that it will be approved as a
licence category and to enable the proper distribution of costs and the calculation of revenue
but have not been included in the schedule of proposed fees. Fees for this category will be
set when they are included in the By-law. For the purpose of the model the fees for
Complementary Care/Holistic Therapists have been set at the same rate as the fees for
Massagists and Massage Parlous.
Overview:
The model is an allocation of projected costs, based on the distribution of time spent in
performing tasks related to the regulation and administration of specific categories of
licenses. These costs are classified into groups called Cost Centres which reflect a type of
activity carried out in administering the by-law.
The four main Cost Centres are Administration, Issuing, Enforcement, and Commission
Support Services.
Three types of costs have been identified :
(i)Direct costs - these are costs that apply to the regulation of a specific category of license,
e.g. the time spent inspecting taxicabs.
(ii) Common Costs - these are costs common to all licenses, e.g. computer support.
(iii) Special Costs - these are costs incurred by specific licensees and not by others within
the category, e.g. mechanical inspection re-checks. These costs are usually recovered on a
pay for use basis.
Summary of Cost Allocation:
