Toronto Dollar History

The Toronto Dollar began in December, 1998 and the project has operated on the basis that 10% of every Toronto Dollar that is sold is directed to a fund to support local community projects. We have been using these funds as a type of "time dollar" to pay honorariums to people who are doing community service, and our goal has been to direct the limited funds generated by the Toronto Dollar project to people who are struggling to make a living. Our strategy has been to implement this initiative through local agencies and community organizations. The Toronto Dollar has also proved itself as an important tool for undertaking local community events and projects. It has served as a means to co-sponsor and initiate events and programs, such as the Toronto Dollar Party, the Global Roots festival, the Holy Trinity / Margaret Atwood Concert, the Frankly Bob Awards, the Elaine Hall Awards, the St. Lawrence forums, etc.

The model used by the Toronto Dollar is different from most other models of local currencies in the way it can be redeemed by businesses for 90 cents on the dollar. This feature has advantages and risks. The main advantages are that it helps to build confidence in the currency and it is easier to involve local merchants. The main drawbacks are that a person needs Canadian dollars to obtain Toronto Dollars, and the money needs tight control because it is similar to always dealing in cash. It is difficult for small community organizations to develop banking skills to provide the necessary controls. The support of two banks, CIBC and the Royal Bank, has helped us in this capacity building but the central control still rests with the Toronto Dollar office and any expansion is a strain on our limited resources.

The Toronto Dollar has many educational benefits in helping people to understand the operation of the economy and public spending priorities. As well, it is an important way of showing consumers how they can support the local economy. The growing international internet network and other communications among local currency users testify to the value of local currencies as an educational tool.