$100-MILLION QUESTION

City earns big profit from Enwave sale. The issue now: Where to spend it,

City council approved the sale of Enwave Energy Corporation at its first meeting since the summer break, securing $100 million in unexpected profit. But questions remain about where that “windfall” should be spent — despite the fact city staff say it needs to go towards streetcar debt.

Frustrated, chief financial officer Cam Weldon had some tough words for councillors afterwards, saying they need to learn to stick to a plan and a budget or risk slipping “deeper and deeper” into the red.

“I’ve said this to council, and I’ve done it for my own personal finances and that’s why I can retire at this time: You have to be disciplined. You have to have a plan. It should be a long-range plan. You should stick to that plan as best you can,” he said.

“The problem that I’ve seen — and some of it you saw today — was that we had a plan: Staff recommended that $168 million go to the capital reserve . . . (Council) approved it in (the 2012 budget in) January. Nnow they want to deviate from the plan. They want to add more things. If you keep doing that we’ll get deeper and deeper. We’ll go backwards.”

Toronto owned 43 per cent of the deep-water cooling company. Bore- alis Infrastructure, a branch of the OMERS pension plan, owned the remainder and will reap $223 million on the $480-million sale to Brookfield Asset Management. The city’s share amounts to $168 million, which, minus a $68-million investment, works out to $100 million in profit. City staff wanted that money to go towards debt for new streetcars. Over 10 years, it will save about $20 million in interest. In a brief speech to council, Mayor Rob Ford said it was probably one of the largest windfalls the city has ever seen, or ever will. “Every dime must go to streetcars,” he said. “I inherited this mess and I have to clean it up, and we are cleaning it up now.” The purchase of a new streetcar fleet cost about $1.2 billion. The city has paid $300 million . The province is set to contribute about $400 million, leaving a $500-million bill. Councillor Pam McConnell wanted $50 million to be directed to the Toronto Community Housing Corporation. Other councillors hoped it would go towards a Toronto Water capital fund to deal with basement flooding issues. McConnell said she wants a portion of the windfall to be put towards the TTC, but there is serious repair backlog in the city’s public housing portfolio. “I think this windfall is an opportunity for us to do something very important: (take this windfall and) place it into people’s lives,” she said. After hours of debate, council decided to let the budget committee make the decision.