Politicians from all parties should be asked tough questions about their support of Toronto’s Sidewalk Labs Quayside project while on the campaign trail. This is an artist’s rendering of the project. Sidewalk Toronto

Federal leaders should face tough questions about Toronto’s smart-city project

With the federal election campaign under way, it’s helpful to have a quick and easy way to evaluate our prospective leaders’ commitment to good governance and sound economic policy.

I suggest a simple question: “If elected, how would you handle the Toronto Quayside development?”

For those of you who haven’t been following the bizarre controversies surrounding what a Swedish colleague of mine has dubbed “an urban development thriller,” the Quayside drama started in October 2017.

That’s when Waterfront Toronto, the tri-governmental agency responsible for developing a portion of Toronto’s portlands, awarded a contract to a Google sister company, Sidewalk Labs, to create a smart-city development plan in a 12-acre plot of land called Quayside.

As one of those three governments, the federal government has a say in the future of this project. It appoints a third of the directors to Waterfront Toronto’s board of directors (numbering 12 in total). Waterfront Toronto has also committed to seeking approval for the project from the three levels of government. Whoever forms the next government will therefore have an important role to play in the future of this project.

While this issue affects Toronto residents directly, the parties’ approach to Quayside will prove instructive to all Canadians.

It will reveal their approach to managing a 21st century digital economy in which data governance, intellectual property and Internet of Things infrastructure are becoming increasingly important. It will also demonstrate whether they have a fundamental respect for good governance.

By both measures, the Quayside project has been a disaster from the very beginning.

Bad governance

For a young company (created in 2015) whose most impressive feature is its connection to the world’s leading data company, Sidewalk Labs has proved remarkably reluctant to discuss how they would govern data, the lifeblood of any smart city.

Waterfront Toronto, meanwhile, proved unprepared for this type of project, a conclusion backed up by a scathing Auditor General of Ontario report. In response to public pressure, Waterfront Toronto convened a part-time Digital Strategy Advisory Panel to advise it on these issues, a clear admission that it lacked the ability to handle them on its own. Early on, the panel was hit by two resignations. The auditor general reported that panel members criticized the panel for having “limited” effectiveness.

Then there’s the puzzling nature of the relationship between agency and vendor. The agreement governing their relationship gives Sidewalk Labs and Waterfront Toronto equal responsibility for developing the plan, even as Waterfront Toronto is acting as if it’s an independent evaluator of the project.

Will Fleissig, the Waterfront Toronto CEO who brought Sidewalk Labs to town, was pushed out by the Waterfront Toronto board in July 2018, according to The Logic, in part for “his oversight of a decision to allow Sidewalk Labs personnel to temporarily occupy office space in the Waterfront Toronto headquarters.”

Julie DiLorenzo, a Toronto developer and board member, resigned in July 2018 in protest of the many questionable actions by the two organizations, several of which are laid out in the aforementioned Auditor General report.

As disturbing as the governance practices surrounding Quayside have been, the substance of the actual proposal is even more problematic.

Problematic economic policy

In late June, Sidewalk Labs issued its four-volume, 1,500-page Master Innovation and Development Plan (MIDP), a Potemkin Village of a report with a physical heft that gives the illusion of thoroughness and competence while delivering neither.

The MIDP was not written to be read. It lacks an executive summary, a complete table of contents, an index and in-text hyperlinks. I’ve read travel guides that are more technologically sophisticated than what this Google company has produced.

Despite these challenges, I actually have read all 1,500 pages of this plan — I even liveblogged it.. What I found was very disappointing.

Those expecting a carefully presented, detailed development plan will instead find a document that reads for the most part as a sales pitch — that is, when it’s not playing fast and loose with its terms of reference.

Rather than focusing on the Quayside district, as required by Waterfront Toronto, Sidewalk Labs makes clear that it has designs on a much broader section of the waterfront: A 190-acre parcel that it terms the “IDEA District.”

A view of the Portlands area of Toronto, the possible future home of Sidewalk Labs, from June 2019. THE CANADIAN PRESS/Andrew Lahodynskyj

To run what is a very tiny part of Toronto, it proposes five new public agencies without bothering to cost them out in terms of the specialized skills that would be needed to run them or their budgets. All we’re told is that user fees will pay for everything.

The promised economic benefits — which would emerge only in the very long term (20-plus years) — depend on a few key bets.

Getting Google to set up its Canadian branch headquarters to catalyze an already-existing Toronto tech sector is one of these bets. Meanwhile, a substantial amount of the plan’s promised economic and environmental benefits hinges on two unproven technologies, self-driving cars (by 2035) and mass-produced timber skyscrapers involving a Sidewalk Labs-created timber mill/factory.

All three proposals raise important policy questions requiring substantive debate; they should not be treated as pure technical matters. And the success of the latter two depend on regulatory, societal and technological changes, especially for self-driving cars, that are beyond the control of Sidewalk Labs.

On data policy, Sidewalk Labs invents a term, “urban data,” that, as York University academic Natasha Tusikov argues, provides cover for the widespread collection of personal data, including for commercial and advertising purposes.


Read more: Sidewalk Toronto's master plan raises urgent concerns about data and privacy


Waterfront Toronto has raised several similar concerns with the Sidewalk Labs plan. In response to Waterfront Toronto’s stated concerns, the two organizations in July 2019 amended their agreement to allow Waterfront Toronto to sever its relationship with Sidewalk Labs if its concerns are not addressed by Oct. 31.

This type of public bargaining is odd given their existing close relationship.

The Oct. 31 deadline is mere days after the federal election. Candidates will certainly be tempted to decline to comment on Quayside because of the deadline. But even before the election, the Liberals suggested they’re taking a hands-off approach, and not independently reviewing Waterfront Toronto’s decision.

Planning our digital future

Given all the problems with Quayside, to say nothing of the interdependent relationship between Sidewalk Labs and Waterfront Toronto, it would be a mistake not to press candidates on the project.

It touches on crucial questions of data governance and who will write the rules of the 21st century economy that Canada is starting to grapple with. If approved, it will have an impact on economic policy-making throughout the country, and possibly the world.

Some have argued we should go along with Sidewalk Labs’ plans just because it’s a change from the status quo.

But Canada needs sound digital economic policy. Innovative urban policy is similarly urgently needed. Change for the sake of change is hardly a recipe for sound policy.

We need to get these rules right rather than sign onto a plan without fully considering its many flaws. If the federal government can’t get something like Quayside right, it doesn’t bode well for Canada’s digital future. Luckily, this election gives us a chance to see where the parties stand on these vital issues.

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