The term "Israeli Apartheid"
...and of itself does not violate the City's Antidiscrimination policy as it does not impede the provision of services and employment provided directly by Pride or the City to any group on any grounds provided for in the Policy. There is no legal precedent that the phrase constitutes a hate crime under the Canadian Criminal Code.
For the use of messaging containing the term "Israeli Apartheid" to contravene the Ontario Human Rights Code, it would have to be judged by the Human Rights Tribunal of Ontario (HRTO) to contravene Section 13(1), which prohibits any notice, sign, etc.that indicates the intention of the person to infringe a right under Part I of the Code...
I doubt an appeal to the HRTO would go through. The provincial section 13
...is infringed by a person who publishes or displays before the public or causes the publication or display before the public of any notice, sign, symbol, emblem, or other similar representation that indicates the intention of the person to infringe a right under Part I
...and I doubt anyone wearing a t-shirt bearing, for example, the words "Stop Israeli Apartheid" on it is telegraphing any such intention. To giver a specific instance, nobody would suggest that a person wearing such an item of clothing (or waving a banner similarly inscribed) wants Israelis to be denied employment.
And if Rob Ford et al want to cut The City's $120,000 worth of funding based on more straight-forward (cost cutting) grounds, well, there goes another $90,000,000 for local businesses and 600 full-time jobs.