A sky train runs near downtown Vancouver in 2015. Regional transport provider TransLink is warning of massive service cuts unless what it calls a $600-million funding gap is addressed.JONATHAN HAYWARD/The Canadian Press
Late last month the head of TransLink, the organization that oversees Metro Vancouver’s transit system, let people in on a poorly kept secret: there isn’t nearly enough money in the coffers to maintain existing operations.
Without more cash from the government – either that of B.C. and/or Ottawa – the only option was massive cuts to services, impacting hundreds of thousands of people.
And TransLink CEO Kevin Quinn wasn’t bluffing.
“Unfortunately, this is a window into our reality if a solution to our outdated funding model is not implemented,” Mr. Quinn said.
TransLink’s annual operating shortfall is estimated to be somewhere in the neighbourhood of $600-million. How did this happen? Well, the answer is, at least in part, quite understandable. The organization derives some of its income from fuel taxes. But a shift toward hybrid and electric vehicles has cut into that source of funding.
During the pandemic, a scheduled fare increase was cancelled. In subsequent years, those increases have been held at levels below inflation. (TransLink couldn’t raise its rates to cover annual inflation percentage increases that reached 6.8 per cent in 2022 because, it argued, people couldn’t afford it. Also, the B.C. government almost certainly wouldn’t have allowed giant fare increases).
Meantime, the costs to TransLink of things such as construction, labour, fuel, maintenance and new vehicles have been increasing at astronomical rates.
It’s all added up to a pending disaster for the B.C. government.
And we haven’t even talked about the costs of transit-related initiatives such as the expansion of its light rail system. It was recently revealed that a planned extension of the SkyTrain system is already facing a $2-billion overrun, bringing the now-anticipated final bill to around $6-billion. There are other transit-related projects facing similarly daunting cost pressures.
I wish this was a uniquely B.C. story that could solely be blamed on government and bureaucratic incompetence, but it’s not. This is a countrywide phenomenon that highlights the mind-numbing challenges facing governments when it comes to funding transit systems.
This was underscored in a report released in May by Leading Mobility Canada, which warned that the country’s biggest cities were struggling to keep their transit systems running. Without a solid and sustainable funding plan going forward, the report said, these same transit systems would begin a rapid downward spiral that would take years to reverse.
It’s not hard to see how that could happen.
Unless B.C.’s transit system is bailed out soon, the massive service cuts TransLink is forecasting will go ahead. If that happens, people won’t know what hit them. There is likely to be a massive ridership revolt. The provincial government, maybe with help from Ottawa, will have to step into the breach. But that’s only a temporary measure. There needs to be a sustainable funding model established soon, because what exists now in B.C., and certainly elsewhere in the country, is not working.
Cities themselves do not have the taxing power to generate the kind of money necessary to run modern transit operations. Property taxes are the primary source (after fares) cities have to fund transit. But in today’s environment, with cost pressures being greater than ever, raising property taxes to cover transit isn’t really a viable option. Meantime, provincial governments have been reluctant to green-light other possibilities, such as congestion or road taxes, because of their political unpopularity.
Which leaves organizations like TransLink in an untenable position.
It’s hard to think of a recent period in which cost pressures on governments have been greater. The price tag to properly fund a transit system like the one in Greater Vancouver will cost hundreds of millions of additional dollars annually, and that doesn’t include the multiple billions needed for transit expansion.
Then you think of the crumbling infrastructure across the country, leading to water main ruptures and the like. This is another ticking bomb set to go off in spectacular fashion. In fact, we’ve already begun to see the first detonations. (Hello Calgary and Montreal). A 2020 report from Canada’s Core Public Infrastructure Survey found nearly one in five kilometres of water, sewer and stormwater pipes were reaching the end of their functional lives.
Then add on top of that the health care crisis in Canada and the enormous investment of money that’s needed to address it and, well, it adds up to dollar totals that are almost unfathomable. It’s hard to see how governments will meet these challenges without having to make some tough choices.
This, in turn, means the public may have to get used to governments not funding things they might have in the past. I don’t see they really will have much choice. In the meantime, Vancouverites, please take transit.