When it was announced last year that a district in Toronto would be handed over to a company hoping to build a model for new tech-driven smart city, critics were quick to voice concerns.

Despite Justin Trudeau’s exclamation that, through a partnership with Google’s sister company Sidewalk Labs, the waterfront neighborhood could help turn the area into a “thriving hub for innovation”, questions immediately arose over how the new wired town would collect and protect data.

A year into the project, those questions have resurfaced following the resignation of a privacy expert, Dr Ann Cavoukian, who claimed she left her consulting role on the initiative to “send a strong statement” about the data privacy issues the project still faces.

“I imagined us creating a Smart City of Privacy, as opposed to a Smart City of Surveillance,” she wrote in her resignation letter.

After initially being told that the data collected would be wiped and unidentifiable, Cavoukian told reporters she learned during a meeting last week that third parties could access identifiable information gathered in the district.

“When I heard that, I said: ‘I’m sorry. I can’t support this,’” she told the Global News. “I have to resign because you committed to embedding privacy by design into every aspect of your operation.”

Cavoukian isn’t the first to resign amid worries about privacy protection. This month, Saadia Muzaffar, a tech expert and founder of TechGirls Canada, stepped down from the digital strategy advisory panel, saying that the company was not adequately addressing privacy issues she and others had raised.

Quayside, the new district and “urban living laboratory” being developed by Sidewalk Labs, is intended to serve as a prototype that could be studied and replicated across the globe to solve urban issues.

“By combining people-centered urban design with cutting-edge technology,” its vision statement reads, “we can achieve new standards of sustainability, affordability, mobility, and economic opportunity.”

In a Google TechTalk video from 2016, Anand Babu of Sidewalk Labs spoke about “reimagining the city as a digital platform” and using tech to solve the problems big cities face.

While details for the city have not been finalized and the final plan for the project won’t be released until next year, in August Sidewalk Labs announced some of its ideas. They plan to use tall timber – instead of steel and concrete – to build sustainable housing, construct new types of roads for driver-less cars, and use sensors to collect data, intended to inform energy usage, help curb pollution, lessen traffic and monitor noise.

Sidewalk Labs invested roughly $50m into the deal initially, with ambitions to scale up. With 3.3m square feet of office and retail space, the city is the largest attempt to marry tech with urban planning in North America.

In a blogpost published last week, Alyssa Harvey Dawson, Sidewalk Labs’ head of data governance, wrote that Quayside would “set a new model for responsible data used in cities”, but that the company was still working to settle on a plan.

“The launch of Sidewalk Toronto sparked an active and healthy public discussion about data privacy, ownership, and governance,” she wrote, linking the latest draft of a digital governance proposal. In her summary, she states that the data collected in the city should be controlled and held by an independent civic data trust and that “all entities proposing to collect or use urban data (including Sidewalk Labs) will have to file a Responsible Data Impact Assessment with the Data Trust that is publicly available and reviewable”.

But, as big tech companies continue to struggle with protecting privacy, experts have highlighted the dangers of the new plan, and answers to their questions have not yet been adequately answered. In an op-ed for the Guardian last year, Jathan Sadowski, a lecturer on the ethics of technology, wrote that handing over public entities like cities to corporations could have negative side-effects.

“Mayors and tech executives exalt urban labs as sites of disruptive innovation and economic growth,” he wrote. “There’s no doubt that urban labs can help in the design of powerful, useful technologies. But building the smart urban future cannot also mean paving the way for tech billionaires to fulfill their dreams of ruling over cities. If it does, that’s not a future we should want to live in.”

Sidewalk Labs issued a statement saying: “At yesterday’s meeting of Waterfront Toronto’s Digital Strategy Advisory Panel, it became clear that Sidewalk Labs would play a more limited role in near-term discussions about a data governance framework at Quayside.

“Sidewalk Labs has committed to implement, as a company, the principles of Privacy by Design. Though that question is settled, the question of whether other companies involved in the Quayside project would be required to do so is unlikely to be worked out soon, and may be out of Sidewalk Labs’ hands.

“For these reasons and others, Dr. Cavoukian has decided that it does not make sense to continue working as a paid consultant for Sidewalk Labs. Sidewalk Labs benefited greatly from her advice, which helped the company formulate the strict privacy policies it has adopted, and looks forward to calling on her from time to time for her advice and feedback.”