Lights out - Toronto Pearson International Airport

YEARS OF DEDICATION
Steve Shaw retired from the GTAA as V.P. Marketing & Business Development in January 2009, after 16 years of service.
Here, he gives a unique look back at the creation of the GTAA and the operation of Toronto Pearson, as well as his take on the future.
It is late afternoon on January 6, 2009. I take one last look
out my panoramic offi ce window at the airfi eld and then
turn the lights off for the last time in my offi ce and walk
out, no longer an employee of the GTAA.
It is hard to think back sixteen years to when my involvement
with the airport authority began. Pearson has been redeveloped,
and the GTAA has matured into a sophisticated corporation.
Yet for me, the moment of my leaving the GTAA is the end of
an exciting and very fulfi lling journey. While it is personal, and
so is my view of the way things were, there may be lessons to
be gained by going back to the roots of the enterprise and the
reasons and the politics around its beginning. The GTAA had
indeed an unusual and precipitous birth and could easily have
been a still born entity.
Let me share with you my view of how it all began.
I was in the Economic Development Division of the Metro
Chairman’s Offi ce as a Senior Development Offi cer. In 1992 we
were in a recession and my work related to the task of getting
infrastructure projects started to jump start the economy of
Metro Toronto. One of the initiatives that I began to hear about
was Pearson Airport and the opportunity to devolve its operation
from Transport Canada to a “Local Airport Authority (LAA)”. The
idea was simple: transfer the airport to a private corporation that
could fund the much needed capital improvements to the airport
and through its locally appointed Board could develop the airport
for the economic benefi t of the local region.
This “privatization” of airports had begun as a Conservative
initiative and although it was eventually to be expanded and
structured by the Liberals with the National Airports Policy, the
initial Conservative approach was pragmatic rather than policy
driven. In the case of Toronto, this privatization effort had begun
with the leasing of land for a private for-profi t company to build
Terminal 3 (T3). While Transport Canada ran the airport, T3 would
be managed separately under various agreements with Transport
Canada to ensure traffi c, policing, etc. The success of the T3
noise and the majority of directors should therefore be appointed
by the City. Toronto obviously disagreed and the province also
weighed in by setting up their own airport group.
In the meantime, the potential economic benefits seemed
to be evaporating along with any local community control and
it was this issue that stirred action, particularly within Metro
Toronto. The Boards of Trade and the Chambers of Commerce
were very well-exercised regarding the failure to advance a
process that would allow the airport to most benefit the economy
of the region. The Toronto and Mississauga Boards in particular
became strong champions of the LAA cause.
Recognising the impasse, Metro Chairman Alan Tonks
brought the issue to the Regional Chairmen who met regularly
as the GO Transit Board. The six regional chairmen decided to
establish a task force of persons from each region to try to come
up with a proposal for a local airport authority that would have
ii. The private business interests to be represented by
the Boards of Trade/Chambers of Commerce of each Region
proposing persons.
iii. The distribution to be shared equally by all Regions
meaning each region would get two nominees to the Board.
iv. The LAA was to have a regional interest and therefore
it was expected to operate other airports in the Region,
(recognising Mississauga’s demand for the TCCA to be included)
but it had to begin with gaining control of Pearson.
Reflecting back, I realise the invaluable work the secretariat
did to ensure that what was recommended was politically
acceptable for each region. Key staff persons were those closely
linked to the Chairmen and the economic development staff.
These links continued through transfer and, while there have
been many changes, have remained important to the effective
work of the authority.
The secretariat report was agreed to by the task force and
the recommendations were accepted by the Regional Chairmen
in the fall of 1992. Then began a fun period of getting all the
municipalities in the GTA to pass resolutions agreeing with the
report. It was a frantic and energizing time, which exposed the
importance of the airport for the economy to a wide audience
and brought the LAA concept to a new level of commitment from
the municipal councils. In March 1993, the first Greater Toronto
Regional Airports Authority (GTRAA) was incorporated and the
Board of ten members, which included the five members of the
Chairman’s Task Force, began immediately lobbying the federal
government for recognition. It was a frustrating time because the
Minister of Transport sought to avoid making any commitment to
an LAA for Toronto while the government pushed ahead to lease
Terminals 1 and 2 to a private company for redevelopment.
Inevitably the GTRAA became more active politically and
its lobbying efforts brought the support of the Liberal opposition.
By mid-1993, Pearson and the proposed lease of the terminals
was a growing political issue and the GTRAA did what it could to
“Whatever the future of air travel, Pearson will be there because of the GTAA.”
venture, which was clearly for profi t, encouraged the government
to push ahead with a similar proposal for the redevelopment
of Terminals 1 and 2, and this was to be followed by a further
proposal to have a private operator manage the airfi eld.
Beyond Toronto, the airport communities at Montreal,
Calgary, Edmonton and Vancouver were working to set up notfor-profi
t community corporations that would be recognised by
the government as the bodies with which to negotiate a ground
lease for their respective airports.
These other airports, particularly Vancouver, had shown
how important their airport was for the economic growth and
wellbeing of their region. And with this came the opportunity for
each region to market their airport, attract new air services and
airlines and develop the airport facilities to match their vision of
growth. In one stroke, it was argued, under local control and with
access to funding, the airports would surge ahead freed from
government control which funded airports according to political
pressure not local demands. The example given was Toronto
which saw millions go from its revenues to build airports in other
regions while Toronto had struggled with out of date facilities
and restrictions on airline entrance to Toronto in favour of the
“other” airports. This was the point at which I became involved.
We were immediately sold on the importance of Pearson as
the economic engine of the region and the fl agship for marketing
Toronto to the world. But where was our group to be the authority,
and what about the ongoing initiatives of the government to lease
off parts of the airport to for-profi t companies If there was to be
an airport authority at Toronto what would it do Toronto had tried
in 1990 to get a group together but had failed to get agreement
on the structure of the Board. It was all a matter of control and
of money. Control, in the sense that local politicians wanted to
be able to control, among other things, the noise issue. Money,
in the sense that the redevelopment of the airport was seen to
likely generate millions of dollars in development charges for the
City. The City of Mississauga argued that the airport was mainly
in their municipality, which was also most impacted by aircraft
broad acceptance. This was mid-1992.
The situation was complex and challenging:
• The government was moving ahead to further split
up Pearson and have for-profit companies build further new
terminals, and develop the airside. This was seen by many in the
airport business as creating a difficult management structure for
whoever actually operated the entire airport.
• There was local political pressure to keep political
influence over the airport management.
• The Region of Peel and the City of Mississauga were
debating who was to represent the host municipality.
• The City of Mississauga insisted that Toronto City
Centre Airport (TCCA) and Pearson had to be transferred together.
• The Province wanted to have a role and was looking at
supporting a response to the RFP for the new Terminal 1/2.
• The Minister of Transport was stalling on the
Local Authority initiative in Toronto, demanding no political
appointments to any Board and unanimous resolutions from all
municipalities in the GTA supporting any proposed LAA.
• It was uncertain if one authority was going to operate
just Pearson or other airports, even though Hamilton had
separated themselves.
• If the terminals were privatized outside of an authority,
it was unclear what revenue sources an LAA would have.
Yet the Chairman’s Task Force began their work; there was
no time to lose. A secretariat was established to provide staff
support. It was made up of economic development staff and other
key personnel from the five regions. This group, which I chaired,
supported the Task Force and over the course of four months
produced a report with recommendations for the structure of a
LAA. There is much that could be said about the effort to get
agreement but the breakthrough came with the following four
ideas:
i. The political interests to be represented by allowing
the regions to nominate members to the Board but ensuring no
politicians.
promote the need for an airport authority. The election in October
1993 saw the Liberals come into government by a landslide and
the eventual cancellation of the Terminal 1/2 contract. The
new government produced the National Airports Policy in July
1994 which set out a modified structure for airport authorities,
(renamed Canadian Airport Authorities) and the GTRAA was
reconstituted into the GTAA with the Board being expanded to
fifteen members. I remember with satisfaction, the moment in
early December 1994, when the Minister of Transport, Doug
Young, signed the document in Terminal 2 recognising the GTAA
as the airport authority which the government would negotiate
with to transfer Pearson. It incidentally marked my last day as a
Metro employee and I began the next day as a contract employee
with the GTAA; their first.
What the GTAA became reflected those early beginnings:
• The close relationship to the Regional Chairmen;
• The importance of regional economic development in
the vision and work of the authority;
• The need to bring all parts of the airport back under the
control of the GTAA;
• The concept of common use facilities for all airlines;
• The need to protect against inappropriate pressure for
money or influence over airport management;
• The need to build Pearson as an integral facility for the
long-term future.
And so back to the present. I leave an authority that has
matured as a corporation, built excellent facilities with capacity
for the future, and has good relations with its many communities
of interest. Although 2009/10 has major financial challenges
with expected traffic drops and tight budgets, I look beyond and
see what those first Board members saw; an airport run as a
not-for-profit corporation, for the economic wellbeing of the GTA,
the province and the country, being always a part of the success
story of Toronto. Whatever the future of air travel, Pearson will
be there because of the GTAA.
Toronto Pearson Today First Quarter 2009 9