Financial relief for restaurants

City council agrees to phase in new fees for CaféTO patios over three years

City council has agreed to stagger the implementation of fees for CaféTO, delivering a reprieve to restaurant owners who had complained the new charges would deter them from taking part in the popular patio program.

In a statement after the vote on Tuesday, Tracy Macgregor, vice-president of Ontario for Restaurants Canada, called council’s decision “a win for Toronto’s restaurants.”

She said CaféTO “still serves as an emergency response” to help restaurateurs weather “the devastating financial impact of the pandemic” and “it is imperative that the program remain affordable.”

Macgregor said that while Restaurants Canada would have preferred fees be fully deferred for one year, the approved changes “represent a significant decrease from what was originally proposed.”

CaféTO started in 2020 as way to give struggling restaurants a boost during COVID-19, and for the past three years has enabled bars and restaurants to set up outdoor patios on sidewalks and in curb lanes without city fees.

But last month, city staff proposed charging for permits and introducing other regulations this year as the city makes the initiative permanent, prompting pushback from businesses who warned the new rules were too onerous.

At a meeting last week, Mayor John Tory’s executive committee asked staff to report back with options to address those concerns, and on Monday staff recommended easing the transition by phasing the fees in over two years.

On Tuesday, council went a step further by approving a motion from the mayor to instead introduce the charges over three years.

They also approved staff’s revised recommendation to give restaurant owners with curb lane patios more time to install mandatory accessibility platforms.

Tory told council that CaféTO “was and is a lifeline for individual restaurants” that has dramatically improved “the look and feel of the city.” He said his three-year plan hit the “sweet spot” between making it easier for restaurants to sign up, while upholding the principle that private businesses should pay to occupy public space on the street.

He noted that as restaurants emerge from the pandemic, they’re still dealing with a “perfect storm” of inflation, staff shortages, reduced traffic downtown and the looming requirement to pay back federal COVID-19 loans.

Tory said it was council’s “obligation” to ensure “we maintain the jobs, strengthen the businesses, keep the look and feel of the city in its improved state, and that’s something I think this will accomplish.”

As result of Tuesday’s vote, CaféTO fees will be about onethird of staff’s initially recommended amount this year, and be scaled up by one-third each year until 2025.

That means in 2023 the program’s one-time application fee will cost $285, while permits will be set at $14.56 per square metre for sidewalk patios and $43.70 per square metre for curb lane patios.

The fees will roughly double next year, and triple from 2023 levels by 2025.

When fully phased in, the average curb lane patio will cost about $3,075, while the average sidewalk patio will cost about $1,450.

As part of the revised proposal, the city will increase funding to help owners defray the costs of the requirements this year, from $500,000 to $1.5 million.

While patio permits will be approved starting in March, restaurateurs will now have until Aug.1to build an accessibility platform, instead of the initial proposal of May 15.

Owners will be required to install a temporary ramp in the meantime and also submit certified platform designs by July 1.

Coun. Paula Fletcher (Ward 14, Toronto-Danforth) was among the overwhelming majority of councillors who supported the revised regulations, which passed in a 24-1 vote.

She said the original proposed fee structure risked “drowning small businesses.”

“Let’s make sure that the lifeline we throw isn’t a brick,” she said.

Council asked staff to report back in December on the performance of the program, and a key measure is expected to be how many restaurateurs take part.

Under their earlier recommendations, staff had assumed an uptake of about 400 curb lane cafes after the introduction of fees. Last year there were more than 800, plus almost 500 sidewalk patios, although staff reported some of them were underutilized.