On April 2, 2013, Metrolinx released a list of the preferred “revenue tools” in its forthcoming “Investment Strategy”.
Public consultation until today featured a longer list, and several of the options fell off of the table thanks to public and political feedback. The complete list and a detailed analysis of each option can be found in a 225-page report “Big Move Implementation Economics Revenue Tool Profiles” produced by AECOM and KPMG in March 2013.
At a press conference, Metrolinx CEO Bruce McCuaig emphasized that the duty of his organization is to make recommendations, to offer advice, but that the final choice on tools and the amount of revenue to be sought will be up to the politicians at Queen’s Park. This neatly shifts the focus of detailed questions, but avoids the question of just how much detail will be included in those recommendations.
A handout we are sure to see during the next round of consultations outlines the general philosophy and gives details of what might be achieved with each short-listed tool.
The most important statement here is that
An Investment Strategy is about more than just raising revenues for transportation; it’s about implementing mechanisms that grow a more livable, prosperous and sustainable region.
To this I would add that a “strategy” also includes important components such as the staging of projects and discussions about the speed (or lack thereof) with which the full Big Move network is implemented. Today and in the past weeks leading up to the announcement, we have heard a lot about new revenues, but little about how they should be “invested”.
This is not a situation where Metrolinx should sit back and wait for Queen’s Park to act. They should present alternative construction and implementation plans, financing, and the implications for revenue needs in the short and long term.
The $2-billion/year figure has been the standard number cited by Metrolinx going back to the release of The Big Move. Five years ago, this was a $50-billion project with a 25-year implementation plan. At the time, the price seemed to be low-balled, and in any event it did not include inflation. McCuaig wants to maintain consistency in the revenue target in part, I suspect, to avoid frightening voters and politicians with the spectre of runaway costs. However, the Next Wave funding scheme includes giving $500m (25%) annually to the municipal sector, and this slice comes off the top of what would otherwise have gone to Metrolinx. The combined effect of inflation and the municipal share will cut substantially into Metrolinx’ ability to deliver its program.
Changing the tools that would be used or the amount raised might be the subject of a legislated review period to allow adjustment up or down, or to rebalance income streams. This would give an option to raise more in the future, presuming that politicians of the day had the stomach to propose such actions.
Oliver Moore from the Globe asked if Metrolinx had a “hierarchy” of preferred tools. McCuaig replied that the large revenue generators are needed in any toolkit simply to get to a $2b total, but that policy considerations such as land use or influencing transportation decisions might also bring in the smaller tools such as Land Value Capture, Development Charges and High Occupancy Tolls. This was not a convincing response, but those three tools are beloved in some political circles, and they are unlikely to drop off the list without further study.
Newstalk 1010 asked about drivers feeling that they are unfairly targeted by the proposed tools. In fact, most of the proposed tools have nothing to do with motorists. McCuaig missed this obvious rebuttal, but talked about how the investments would not just be in transit but also generally in transportation. Metrolinx hopes to double the regional share of trips by transit from 16% to 33% in the next 25 years, and this will require an integrated view of transportation of whatever kind.
Mike Crawley from CBC asked about the tools that were not included in the recommended list. McCuaig repeated his position that the larger revenue generators are needed plus key tools to influence land use and travel choices, but that Metrolinx would “take input” on others. Royson James from The Star asked why tools such as the Vehicle Registration Tax were not included. McCuaig replied that Metrolinx preferred to use consumption-based rather than user-based tools.
Ben Spurr from NOW asked what municipal reaction have been to these proposals, and how much buy-in does Metrolinx need to go forward with them. McCuaig replied that the decision to implement any of the tools is up to Queen’s Park, but obviously Metrolinx wants to get municipal input. Much later in a scrum, when asked about the reaction of Mayor Ford, McCuaig emphasized that he would look to Council for its position. This is the same approach Metrolinx has taken to decisions on transit technologies and priorities.
A reporter from CHCH asked about timelines–when could transit riders expect to see improvements, and what would happen with promised improvements such as all-day service to Hamilton. McCuaig replied that $16b worth of projects is already underway (this is the oft-mentioned first wave to be funded from provincial general revenues, but which was stretched out to 2021 to reduce year-by-year financing needs). What may happen with an implementation schedule after June 1, McCuaig could not comment as this would be up to the province and municipalities. All-day Hamilton service to James Street Station will begin in 2015.
In speaking of the “Next Wave”, McCuaig hinted that the project list is not cast in stone, and that feedback from interested parties and municipalities could bring changes.
CP24 asked about the implementation and enforcement costs for some tools. McCuaig replied that sustainability of revenue, ease and cost of implementation, economic impacts, social equity, and the effect on travel choices would all be considered in the detailed evaluation of potential tools.
In the case of a sales tax, if it were implemented province-wide, then revenue from areas outside of the GTHA would have to go back to them, but that the implementation details (whether to tax only inside the GTHA and how revenue might be distributed) would be left to Queen’s Park.
A fundamental issue for McCuaig is that any revenue and spending proposals be seen as fair on a geographic basis. This may be challenging considering that the benefit from projects built in one municipality may flow to their neighbours. Metrolinx has not produced any breakdown of the revenue that might be generated for each tool in each municipality. This background will be essential to understanding how any basket of revenue tools will raise money, and by implication how the money will have to be spent through the GTHA.
Hamutal Dotan of the Torontoist was the first of several to ask about operating costs. This is not a trivial problem for Metrolinx because there are at least three different sets of costs:
- The cost of operating new lines built as part of The Big Move
- The cost of operating existing services (mainly GO rail) as all-day, 2-way operations
- The cost of upgrading municipal transit systems to act as feeder/distributor networks to the core GO services
Some of this will be offset by new revenue, but none of the GTA systems including GO breaks even today, let alone with greatly expanded service.
When the Investment Strategy was before the Metrolinx Board back in June 2008, the base scenario was for $3b/year, and possible values ranged up to $9b/year including capital costs for system growth, operating costs and ongoing renewal of the system. Needless to say, this number has fallen considerably thanks to sticker shock, but it gives some idea of what was considered at the time. This amount did not appear to include provision for local transit costs, only for those of the Metrolinx network.
On the bigmove website, another view of the Investment Strategy appears showing the evolution of the capital, operating and renewal costs over a 50-year period. This information fairly clearly shows that there is no thought for the second and third cost categories shown above, and moreover that the revenue stream is “spoken for” in the out years, and is not available for additional projects. When this chart was drawn up, it presumed construction of the entire Big Move 25-year plan, something that appears well beyond the capacity of current revenue and spending proposals.
How Metrolinx will achieve its aims with only $1.5b/year (after the municipal share is sliced out of the pie) is quite a mystery. As for the municipal sector, Toronto’s likely share would not even bring the city back to a 50% share of subsidy by Queen’s Park enjoyed in the pro-transit days of the 70s and 80s.
Notable by its complete absence from the discussion is any mention of accessibility or the operation of para-transit services such as Wheel-Trans. This is yet another area where the responsibilities are left to the municipal sector to muddle by as best they can.
I asked about the staging and delivery of not just the “Next Wave”, but the “Third” and “Fourth” waves beyond. When would Metrolinx start to spend its new revenues on projects such as the DRL or on other as-yet unfunded schemes. McCuaig replied that the DRL still must go through a great deal of analysis and design before actual construction, but this dodged the more general question about less complex projects and the ability to move forward with schemes that require less work to become “shovel ready”.
One reporter asked whether municipalities would be forced to implement intelligent traffic systems including speed limits and signal controls to improve traffic flow (downtown Toronto is already under study by the City). McCuaig replied that funding for such work would come out of the five percent (itself part of the 25%) set aside for local transportation improvements. More to the point, the question perpetuated the downtown focus of the “congestion” debate even though the worst problems lie in the outer 416 and beyond.
Finally, the question of transit fares as a funding source came up. McCuaig noted that the “user pay” principle is a common sentiment, but that fares are not sensitive to a rider’s ability to pay. Part of the toolbox evaluation will be to ensure that those of lower income will not be disproportionately affected.
I would also point out that the suggested $0.15 fare surcharge would disproportionately fall on Toronto riders who are far-and-away the majority of travellers in the GTHA. Such an increase, relative to roughly $2 average fare for all TTC trips, would be a 7.5% bump and this would likely preclude any concurrent increase in the base TTC fare structure putting them even further behind on funding operations and service. If anyone thinks of imposing a fare surcharge, this should be on a percentage basis so that GO Transit riders don’t get a “free ride” with a trivial increase in their much higher fares.
Fare revenue should be reserved for operating costs, not as a source of capital, so that people can get more of what they are paying for–service.
The press conference ended with a recognition by McCuaig that ongoing review and adjustment of the revenue tools would be needed, and that the need for investment will not stop with the “Next Wave”. There will be a constant debate about recalibrating the plans, and adjusting the speed of implementation.
Concluding Thoughts
The Metrolinx list is notably lacking in an Income Tax for individuals or for corporations. Indeed, only a Payroll Tax would be specific to the corporate sector, and it could fall unevenly depending on how labour intensive a company might be. The philosophical question must be whether the corporate sector, which stands to gain from increased mobility for employees and for goods, should help to fund the infrastructure and operation of the transportation network.
This option was dismissed in the background study because of concerns that any income-based taxes would affect Ontario’s (or the GTHA’s) competitiveness. This entirely missed the point that the lack of transportation infrastructure is itself a drag on the local economy, and is a common problem cited by the very businesses whose distaste for new taxes is well-known.
If we are going to give the impression that “everyone should pay”, this is a good place to start.
Two other fundamental problems are the funding of local transit services at a level sufficient to be a real alternative to driving, and the question of how quickly new lines will come into operation.
Without local transit, most trips will remain dependent on the private auto, and the urge to simply stay in your car rather than parking at a transfer station (even if there is room) is hard to fight. My impression is that Metrolinx has given this problem only the most cursory examination, and yet it is a central issue raised in the roundtable discussions held with GTHA residents. People recognize the importance of local service to get them around their own areas, and to connect them with the trunk routes. They also demand fare integration that treats the network as one entity without artificial tariff boundaries. Any consolidation of fare structures will require greater subsidy, but this is yet to appear as a major item for public discussion at Metrolinx.
As for construction schedules, Metrolinx must somehow escape from previous claims that the construction sector could not possibly take on more work. If this is to be believed, then it will simply not be possible to spend all the money we collect with new revenue tools as fast as it rolls in the door. Any discussion of project staging and the speed with which The Big Move can be implemented must have a credible understanding of industry capacity. This would likely have to be subdivided for major types of work such as tunnelling as opposed to less specialized work such as road construction and the creation of LRT/BRT rights-of-way.
Finally, Metrolinx has not included any discussion of financing options such as whether to go “pay-as-you-play” and limit construction (and later operations) to what can be achieved with $1.5b/year, or if the revenue stream would be seen as a long-term tool to service debt that would be raised to accelerate construction to the earlier part of The Big Move’s 25-year planning horizon.
In short, this is a “revenue strategy”, not an “investment strategy”.
There is a lot still to do, and the real decisions, as always, will come from the political level. If the minority Liberal government survives long enough, we might even see the beginnings of major transit upgrades, but this will require resolve, stamina and leadership to counter the facile populism of the no-new-tax brigade.
Steve Munro 
Hi Steve,
Just a quick question (I hope) – I think it’s worthwhile to come up with a strategy that makes everyone pay but other than the inability to act the largest obstacle to overcome are drivers and their insistence on not paying one cent more for anything because they feel they pay too much already (which might be fair). I realize the Big Move is focused on public transit, and that’s good and I agree with it, but would it not make some sense to also include road construction and maintenance (in the GTA) in the plan? I look at the Gardiner and the repair job needed and think this is something that could easily fit within the Big Move and hopefully curry favour among drivers and it shows the plan isn’t out to make drivers pay more or that it neglects them. What do you think? Maybe I’m out to lunch on this but I think it would be important to get 905 drivers onboard with the plan and give them something to support.
Steve: I agree to the point that this would be net new money for major projects like the Gardiner. If all we do is to shift routine road maintenance onto “new” revenue tools thereby creating room for a tax cut elsewhere, or redirection of funds to other accounts, we would in effect be levying a new tax to pay for a non-transit goodie elsewhere in the budget.
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Great summary Steve, most media outlets haven’t done much to add context to the issue.
The issue with The Big Move in my opinion is that it does not act fast enough. Rather than making these investments as quickly as possible given proper approvals, it is to languish and dream of fanciful future ideas.
Why not start the DRL, Hurontario/Hamilton LRT, Dundas/Durham BRT or GO Electrification process now?
The province despite its current fiscal issues still maintains a good Debt rating. Issuing debt with the revenue tools in place should provide ample financial risk security to debt holders. The revenue should be seen as something to pay off the projects in the long term. Something akin to the amortization of costs over the life of the product.
With respect to operational subsidies, if the Federal Government does one day decide to come aboard and get involved with critical transit necessary to the urban economic engines of the country, I would hope that funding could be leverage for operations costs.
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I too was hoping that an investment strategy would include more than a list of ways that we can collect money to pay for a 25 or 30 year plan.
There needs to be a clear list and timeline, and specific proposals for each line.
Something along the lines of:
If DRL by 2025 is the goal – we need to have a 0.5% increase in HST from 2015-2025, or road tolls of 10 cents a km on QEW for 10 years
If DRL by 2035 is the goal – we need to have a 0.25% increase in HST from 2015-2035, or road tolls of 5 cents a km on QEW for 20 years
DRL operationally will cost 1 cents a km on QEW indefinitely, or 0.01% HST increase indefinitely…
I’d be fine if we packaged some of the smaller items together, BRT and LRT in Mississauga will be a 10% increase in prices on Go for all routes originating or ending in Mississauga…
All of the above options, should have expected outcomes – a DRL built by 2025 will reduce crowding at Y&B by 20%, and all trips originating east of Pape will be able to arrive at Downtown core 5 minutes faster. It will have a cost recovery between 60-80%. Service will be more frequent than 5 minutes all day.
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I’m wondering if the obsession with P3/AFP will even be justifiable with all these revenue tools.
Steve: P3?AFP is a financing and project delivery system, not a revenue generator. It will be interesting to see whether we get a fair evaluation of public vs private financing.
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There should also be a parking space fee for businesses along streetcar routes (% of the fee charged to people who park there)… transit could be much improved if those businesses gave up all that street parking.
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In a way, it’s not surprising that Metrolinx focuses on the long-distance, higher-capacity routes and ignores local service. It’s an extension of the traditional hierarchy when dealing with roads and traffic. MTO and upper-level municipalities (Regions and Counties) focus their attention on routes that serve longer-distance travel, often across municipal boundaries, and therefore usually at higher speeds and with higher volumes and capacity. They leave the construction and maintenance of lower-volume, lower-capacity local and collector roads to the lower-tier municipalities, and the lower-tier municipality in turn usually leaves construction and design up to property developers. Municipal official plans only specify freeway, arterial, and sometimes collector roads; the only mention of local streets is usually in policy statements about urban structure, about the road hierarchy itself and about what local streets are supposed to do and maybe look like. Metrolinx is following the same format in seeming to focus its attention on higher-speed and higher-capacity modes (GO rail, subway, then LRT/BRT) and staying mostly silent on local service.
Steve: The problem is that local service is an integral part of the network, and unlike local streets that more or less are there for the taking, local transit does not exist to the degree needed to support the planned GO network. It would be like building the 401 and leaving it connecting to two-lane dirt roads.
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Steve
Thanks again for the comprehensive post.
I look at the 11 tools and wonder how Metrolinx is going to whittle the list down to 4 or 5 manageable tools that will allow for enough money for capital and operations and growth (getting ready for that 3rd wave and 4th wave). I’m still looking forward to a day when we actually ‘catch up’on necessary investment in public transit infrastructure. I believe that it will not happen until the 5th wave … but that’s another story.
Interesting detail … I went to the Metrolinx kiosk at the Dixie Library in Mississauga to take a look at the numbers. I punched in 3 of the 4 Toronto and Region Board of Trade proposal recommendations (gas tax, parking space levy and sales tax) at the recommended percentages/values … and lo-and-behold,the Big Move budget was balanced without the need for HOT lanes.
Now, if the kiosks have the most accurate data that means that we can fund The Big Move with only 3 revenue tools and adding another 1-2 would give Metrolinx some room for a faster pace. I believe there is a kiosk at the Toronto Reference Library as well as many other places … and you can also play with the numbers online.
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On the topic of missing an income tax tool, perhaps this could be one of the revenue tools in order to offset the need for a higher sales tax … but the question is whether the implementation of the income tax or sales tax will cost the most. Certainly the income tax is the most progressive option in the mix and could be spread out to a level that it is not noticeable. Maybe if the Ontario Opportunities Fund could be directed into public transit … well, I’d be happy to give back some of my refund if it was dedicated to transit.
Looking at the actual implementation of the Big Move is going to be a huge next step for Metrolinx and the cities. They will have to bring back their roundtables, and this time the cities and transit providers are going to have to be there as well, and present their development and transit plans to the people to give feedback on. This will all have to be to be this summer and fall in order to move ahead quickly.
Reevaluating the Next Wave projects is going to bring up a lot of issues and most of the attention will be on Toronto and other municipalities will also be screaming for attention.
I certainly hope Metrolinx has a few transit rabbits in a few transit hats in order to surprise the public … even if it is bribing us with our own money.
I suppose one of those ‘rabbits’ will have to be full funding for the Hurontario-Main and Hamilton LRT projects (and let’s not forget K-W) … another will definitely have to be all-day GO rail service to Hamilton. Personally I’d hope for expanded GO bus service and HOV lanes plus the Kipling and Renforth bus terminals.
Cheers, Moaz
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One of the things I’ve tried to highlight at every roundtable and session I attend is that a 2km walk to a Big Move ‘rapid transit’ corridor would take 30 minutes for the average 16-40 year old ‘adult’ male under normal walking conditions.
If I were to take the same walk with my son it would be closer to 40 mins and with my father (who uses a walker) 2km would take an hour.
That is why we need the local transit, bicycles, shuttle-buses, neighbourhood taxis and sidewalks and pathways (with direct access).
Unfortunately we also need the parking lots and drop off areas near the ‘rapid transit’ stations … but it would help to let people know that a cold-start and short car trip (2-5km) can use up more than half-a-litre of gasoline (a cost of $0.65-0.85 at current prices).
Cheers, Moaz
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Maybe it’s cost? It all costs money to create them (i.e. capital costs) and money to operate them (i.e. operating costs.) Both need to be in place before work starts. You can’t start a project and then stop it partway though because the money runs out. And then there is no point in creating an LRT, BRT, or new subway route if the operating costs to run them is not there. And the LRT in Mississauga would be replacing a bus route, so new equipment is required which has to be ready to go on day one or the service need not be started.
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The Resident Right Winger is back.
It’s been a long absence, but this is something I’d like to wade into.
First of all I retched myself when I saw/heard Rob Ford’s reaction. I need not go into further details about why he has fallen out of favour from most Right Wingers. He has lost the touch that he had as councillor to conciliate and mediate. I am not sure where he gets the idea that a Casino will solve all of Toronto’s funding issues for transit, considering that the OLG rightly said that Toronto would only get the same deal other casino-hosting cities would get.
Second, while Ford does make the point that “the city cannot afford more taxes”, I am not sure that higher taxes, or taxes directed towards transit infrastructure development would mean that the money will be used for its intended purpose. Many governments past and present have appropriated funds gathered through taxation and redirected for other purposes. This is not just a left-right thing, it’s more of a political thing (even Harper’s Tories are doing this with the EI and CPP programs).
This is why I will take Metrolinx’s calls for taxation as a revenue generating model with a grain of salt. Also, anyone who suggests new taxes to pay for infrastructure development that isn’t related to an expressway will get skewered in an election, and believe me, the voices who want a highway more than transit development (at least at a provincial level) are a lot higher. Wynne would be smart not to take these suggestions lest her political future be at stake. The Liberals’ reputation for misappropriating tax dollars is absolutely horrid. The financial house needs to be cleaned up and the perception that tax dollars are being wasted needs to be alleviated before any discussion of any revenue generating tools take place.
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I hate to break it to you but Rob Ford was never a conciliator or mediator. During his days as a councilor he was an obstinate gadfly who always said no to everything even when the matter at hand did not involve raising or spending a dime.
Fast forward to 2013 and Rob Ford is still an obstinate gadfly who says no to everything unless it involves mobilizing city resources to manage his football team or to clean and fix the roads in front of his family business.
This is the man who voted against the property tax increase in his own proposed budget because he either wanted to save face and score political points with his base or couldn’t alter course in his one track mind. You give him way too much credit.
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From the same place where he thinks he can use any casino funds to also cut the land transfer tax by 10% and do something about the Gardiner; the magical land of Populism. He doesn’t care if it’s impossible and irresponsible. He only cares if it gets him votes.
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Mr. Ford and many of his illk are extremely illogical when it comes to analyzing where tax dollars get spent to support cars. While some subsidizing/paying for roads is needed overall, according to an old Vancouver report reported in the Globe some 16 years ago, Vancouver figgered out that each car got about $2700 per year, c. 7 times more than what the transit was subsidized. One clear example is the great land area of asphalt in the city, and the drains for it; another is that we seem okay with spending a half-billion or whatever on the Gardiner for repairs with not a single cent in user pay back!
I’m not surprised that Metrolinx etc. has avoided a Vehicle Registration Tax, as with most politicians, there’s a degree of “carruption” in pursuit of “votorists” goodwill.
But it’s a real cop-out to make a distinction between consumption-based and user fees and absolutely, there should be pressure to get a VRT back again. The taxes on booze and cigarettes are in place, regardless of whether the buyer stores stuff on the shelf or not – there is a presumption of usage that absolutely should be applied to vehicles as well, and given all the levels of subsidization and externality costs, having a reworked VST – likely with a footprint/weight message – is needed money.
Of course, we could follow other areas’ leads where money has been tight, and just do things to boost transit – like establish busways a la Curitiba, where private cars just didn’t have the same rights to public space as they previously had, and the result was a system of busways with subway capacity for 1% of the cost.
We may need to wait for energy to cost a lot eg. Middle East blows up, or some other major crisis like a climate problem ahead of that sort of move – much easier in North Americar to keep the subsidies flowing.
It would be nice of the Board of Trade to also investigate/report on the extent of these subsidies btw; though that also needs acknowldging something called “externalities”.
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Fast forward to today. Everyone who had met Rob Ford before he became mayor is absolutely aghast at his antics. Even people who worked on his election campaign are dumbfounded by his ability to open himself up to scandal. Contrary to his ability to personally return calls to his constituents, he doesn’t do that for people in our ward anymore, he hands them off to his brother.
Mind you, he has done a lot of things right on the municipal front, and done a lot of the changes we wanted to see him do, but his accomplishments are rapidly being overshadowed by his inability to be smart about the mayoral office. Our group is fiscally conservative (the guys you love to hate) and he is rapidly losing support from all of us. Pretty soon, the only person who will support him thick and thin is that Toronto Sun reporter who seems to think Ford can do no wrong.
Conservatives want good transit options too. None of us think that a subway to every doorstep is the right solution. It would be nice to have, but certainly not feasible. Contrary to what most people think, our group actually thinks that the LRT plan under Mayor Miller was an excellent plan (probably one of the few things that David Miller actually got right).
I also want to point out a headline today in the Toronto Star that talks about using GPS to charge drivers a toll in the GTA per kilometre. If you want to do that, do that AFTER the transit infrastructure is built not before. I am an ardent believer of the Carrot and Stick approach and as it stands now, the carrot is simply not there. Putting such a stick at this juncture more or less guarantees that people will simply decide to not go anywhere lest they be charged up the wazoo with less than adequate transit options. This is not how we want to raise transit funding. Gas taxes you say? We are already being charged a gas tax to pay for “infrastructure” but certainly this isn’t enough is it? Or better question, how is this money being spent? Is it being diverted to fund other projects as I mentioned earlier?
Someone has to pay for it, but new or higher taxes/tolls/fees shouldn’t always be the first thing that always has to be done.
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That’s actually a common misconception. People in general have nothing against those who are fiscally conservative. It is those who are fiscally liberal and socially conservative while also claiming to be fiscally conservative that everyone despises. This is the group that Mr. Ford is more closely aligned with than those of the fiscally conservative crowd.
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The smallest 3 revenue options (high-occupancy lane tolls, fare increase and development charges) added together are barely more than half the next-smallest amount (fuel tax).
In other words, they’re just drops in the bucket and only adding noise to the discussion. If a revenue source can’t provide at least, say, a quarter of a billion a year, it should simply be ignored, at least if we’re going to be serious about raising some billions (they say 2, I think 3 is a realistic minimum) of dollars per year.
Parking levy + highway tolls + regional sales tax = 4 billion/year; done.
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@Stephen Cheung
Ideally, we wouldn’t impose road tolls before improved transit infrastructure is opened. But the situation we are in now is not ideal, and that justifies us taking a lesser-than-ideal path of implementing tolls before transit improvements. Sometimes, we don’t have time to be ideal.
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The time has come for Metrolinx to remind people that its investment strategy is supposed to focus on moving the GTHA, not building megaprojects or pleasing vocal groups or politicians.
Metrolinx as the ‘independent’ agency must act outside of politics and populism and ideology and build better and more efficient public transit and roads.
That is why we need a clear investment strategy and timeline and phased-in projects (instead of waiting years for a megaproject to complete). We need that often-described example of incremental expansion and constant improvement rather than years of delay followed by costly megaprojects.
That means an expansion of quick, limited-stop bus services (including GO and Municipal buses on highways and ‘VivaRocketZumExpress’ buses) and the infrastructure to support them (bus lanes, HOV lanes, new terminals). There also has to be an expansion of ‘first-mile’ and ‘last-mile’ (or in our case. first 2km and last 2km) services … encompassing all available forms of public and private (and mostly active) transport.
The problem is that Metrolinx is listening to everyone but not everyone is saying what Metrolinx needs to hear.
Where, for example, are the local municipalities with their ‘Local Move’ (and even ‘Little Move’) transit and transport plans that will use up $500mn (perhaps more?) of that projected $2bn (and probably more) needed for The Big Move?
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By the way, I attended an interesting MBOT-sponsored roundtable in Port Credit yesterday morning that produced some very interesting discussions and some surprises, including near-unanimous approval of a regional sales tax (if the issues of the ‘regional boundary’ and possible leakage can be worked out… perhaps by making it province-wide and spending the money throughout Ontario on transport infrastructure), and 100% acceptance of a fuel tax.
In contrast HOT lanes were declared to be a non-starter, along with most of the ‘high-cost-but-low-revenue’ tools In the shortlist.
Another consensus was on using existing revenue collection mechanisms rather than new ones because as one person pointed out,
Cheers, Moaz
Steve: That line is absolutely classic! This is the simplest explanation of “efficiency” in the implementation of a new revenue stream I can imagine.
There are some in the Ontario government who have a fetish for indirect measures such as development and value increment charges, not to mention “user pay” schemes like HOT. None of these produce much revenue, but they divert discussion from more broadly-based taxes that risk offending many voters. I hope that we don’t end up with an avoidance of the hard, big-ticket decisions. This might require leadership from the Premier’s Office.
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@Mikey
I understand (but do not agree) with your assessment, which is why if anyone is going to raise any sort of toll/tax, it has to be done after the financial books are cleaned up. Tolls and Taxes should always be a last resort, not the first gun drawn in a fight. You are simply asking for major political trouble if you start taxing and tolling before anything is built. Just look at McGuinty and all that tax money that has been misspent so far under their watch. How do we guarantee that any taxes/tolls raised will go towards needed infrastructure spending and not padding the pockets of government entities everywhere, Liberal or Conservative?
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That’s not just him, that’s all politicians. Politicians live and die on their popularity.
A sales tax is charged based on what you purchase. The more you purchase, or the more expensive an item, the more you pay in sales taxes. Plus the Government already offers a ‘rebate’ to lower income people to make up for the cost of sales taxes.
Charging to use a highway works too. Nobody has to take a highway, so there will always be a ‘free’ option if a driver does not want to pay tolls on a highway.
I still think employers living away from a transit route should be charged more, not the other way around. A lack of transit forces people (employees and customers) to drive to the location where a location nears transit does not. Remember demand for transit goes a long way to what kind of service is offered.
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But the rub with that is Ford sells himself as an anti politician. So him basically saying “I’m just like every other politician except I’m not” is partly why he is in so much hot water nowadays.
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I think what needs to be done before anyone starts pushing specific revenue tools for transit is to first spell out how much congestion costs the individual motorist. By that, I’m thinking along the lines of a series of signs that would calculate the difference between the posted speed limit and the average speed that traffic is moving at. Then it would display the average speed, how much additional fuel is burned due to that speed difference for the average car, the cost of that fuel per kilometer based on fuel prices for that day, and the total cost to the next major highway junction. So for example you would have a sign for the northbound DVP at the Bloor viaduct which would display the speed and fuel information and the total cost to reach the 401.
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Public transit expansion should be funded via progressive taxation. Everyone benefits from public transit. Not by penalizing motorists. Keep in mind that while motorists tend to have more of an ability to pay than public transit riders, many working-class people in the suburbs are scraping whatever they can to afford automobile ownership because not having a car is the kiss of death in the suburbs. It’s truly something that will leave you behind in the dust in the vast majority of the GTHA. To price working-class people out of roads and onto inferior public transit while the wealthy drive is going to further fuel class resentment and divisions. If I have to leave around 7:43 in the morning in order to get to work via public transit instead of 8:10-8:15 (depending on traffic volume), I’m going to feel a lot of resentment if you try to price me off the road.
My 8 km Mississauga office work commute is almost impossible to serve adequately with public transit. It includes 14 mins of walking (37.84% share of total commute time) and 4 mins of wait time for second bus (10.81%). The time spent on the actual bus is only 19 mins (51.35%) because Hurontario has a limited-stop express bus. A Hurontario LRT and Eglinton exclusive right-of-way BRT would shave off some time from the public transit commute yeah. Shorter headways would reduce wait times (though by sheer luck of scheduling, you don’t have to wait long for the second bus anyways). But it still doesn’t defeat the fact that I need to walk 7 mins to Mavis/Eglinton and 5 mins to my office from my final stop. And 2 minutes in between (which includes having to wait for your turn to cross the road). The local Hurontario bus (19) stops a lot closer to the office. But it’s a slower bus ride. And due to the suburban residential design prevalent in Mississauga, I’m far from bus stops no matter whether you take local or express. In fact, my nearest Eglinton intersection is with Mavis, a major intersection. So local Eglinton service would offer me zero advantage re: walking distance.
That doesn’t mean I think Mississauga should give up expanding public transit. But the fact of the matter is that there are always going to be people who have to drive because Hazel McCallion, in her short-sightedness, designed Mississauga around the automobile. Punishing motorists who live in these communities is unfair, because there will never be a viable public transit alternative in these areas.
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I find this to be a self-defeating perspective, as it provides fuel to those who perceive a “war on the car.” I say this as someone who doesn’t own a car (and does not intend to own one).
I do not find the analogy to booze and cigarettes convincing because they are one-time use items. When that pack of smokes goes up in smoke, then the smoker has to buy another pack when the next craving hits. Thus, it is in fact a consumption-based tax. Same fundamental applies to booze; when the last drop is gone, it’s back to the LCBO if/when more is desired.
A private vehicle is not one-time use though. Moreover, so much of the region is built with poor transit access, many feel that owning a vehicle is not a choice but a necessity, even if they don’t use the car on a daily basis. Take, for example, a community that gets no (or very poor) weekend transit service. This is why it draws wrath from so many. It is the perception of a tax on a necessity rather than a luxury.
More importantly though, is that the private vehicle tax does nothing to combat congestion, it only raises revenue. This is the wrong approach, not only due to the optics of such an approach, but that revenue is not the sole end goal. The end goal should fundamentally be two-fold in my view: Raise revenue, and induce reductions in congestion. This is where consumption-based charges become a big asset, as it will raise revenue (and a lot more revenue compared to the lightweight private vehicle tax), but also induce changes in behaviour.
The vehicle-kilometre-travelled charge is effectively the holy grail of options in my opinion. It can generate a lot of revenue, but it also discourages auto use, and can be applied in a manner that varies the charge by time of day and even by route travelled. This way, drivers are not penalized for owning a vehicle, they are penalized for using it at certain times of day in certain parts of the region. This is easy to understand, and by extension should be easy to accept. Similar could be said of parking levies, although this is socially more complicated because of “associated impacts” of parking as perceived (actually a misperception, in my view) by the business community as it relates to on-street parking in particular.
The same applies for 400-series highway premiums. The premium for driving fast is a prudent tool because going fast is a choice in a way that buying a first-class ticket is a choice. If we want to encourage people to either live closer to work or take a train for longer distances, this approach would push things in that direction.
There needs to be changes in behaviour. That said, there needs to be capacity for accommodating that change in behaviour, too, so there has to be some caution in how quickly these fees get phased in relative to the state of the network.
Higher transit fares should also be part of the mix, but not for capital costs. As I’ve said in the past, a hike in the minimum wage is also an important parallel component with this (minimum wage, like transit fares, should increase every year to keep in line with cost of living/cost of service). As road use costs climb, transit fares can rise without a loss of ridership since road use costs would rise at a faster clip. Ultimately, whatever the cost-recovery ratio is expected to be, it should be the same for roads and transit alike. This would be equal treatment of modes requiring transportation infrastructure, as the Canada Transportation Act promotes/declares.
Steve: The only problem with cost-recovery is that nobody has dared to talk about the fully allocated costs of all forms of transportation including capital. Moreover, as a matter of policy, a higher level of “subsidy” for transit users may be desirable as a tradeoff to the alternative — trying to provide capacity for the same travel by car. I don’t give a damn about the Canada Transportation Act considering that we get almost nothing from that branch of government, and the lest thing we need is meddling from Ottawa telling us how we should warp our spending to suit their advertising campaign.
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Markham Councillor Jim Jones floated his iMETROe transportation concept a year back — has Metrolinx responded to it? Ie., the re-tasking and electrification of the Uxbridge GO train as a “surface subway”?
Steve: This was a hare-brained scheme that deserved to be ignored. I started to write a critique, but considering that the full document was not available online (it is a very graphic intensive doc), and that it seemed to have dropped from view, I didn’t bother. Karen Stintz incorporated it in her One City plan, although with an associated astronomical pricetag.
One particularly galling part of the proposal was that it could be paid for by that miracle of neo-con financing, property value capture and tax increment financing. In order for this to work, the proposal takes a swath of land a few kilometres wide around the entire corridor all the way to Union, including the entire Port Lands, and scoops the imputed revenue. This ignores the fact that many other services might influence property values, and the one line cannot simply take all of the potential revenue for itself.
Metrolinx has been ignoring the report, but I suspect it will surface again if only because it’s another chance for Toronto pols to “give Scarborough what it deserves”.
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Singapore is probably one if the best places to look at when it comes to discouraging car use and emphasizing public transit and public transport (including taxies and Shuttle Buses).
First there is the Electronic Road Pricing which everyone is somewhat aware of … but most don’t know that it applies to roads AND highways and rates are dynamic and flexible. All motorized vehicles (cars, vans, taxies, buses and motorcycles) have to pay ERP when it is enabled.
Aside from ERP Singapore has limited parking but almost all underground parking is intelligent and designed to discourage people from driving into the city (with progressively increasing taxi rates).
Then there are different types of ownership permits, including lower cost ‘weekend car’ permits. The cost of a regular permit is more than 100% of the value of the car.
Finally the total number of permits is limited, to approximately 10% of the population (and declining).
Although Singapore does not have VKT, dynamic ERP, effective public transport (which can still be made more efficient and reach more people), and high costs and limitations on ownership have created an island that is more or less ‘free’ of traffic congestion. Yes it still exists but only at a few bottlenecks.
Ironically in neighbouring Malaysia cars [cost] about 3-7x what they cost in Canada (about the same or a bit less than Singapore) because of excise duties (to protect local car manufacturers) and rent-seeking ‘approved permits’ (giving free wealth to political cronies) and fuel costs a lot of money (despite a subsidy) but people still drive excessive kilometers and face traffic congestion that makes the GTHA look good.
At least one of the revenue tools that Metrolinx chooses has to be designed to change driver behavior … but those tools are going to be the ones that people are the least supportive of.
Some info on transportation in Singapore can be found in The Star.
Cheers, Moaz
Steve: In any discussion we have of various tools and experiences elsewhere, the local political and economic context is a vital part of the story. Your description, for example, of car ownership rates and what is required to get one are completely different from the situation in the GTHA, not to mention that a directive to implement a usage monitoring system affects a minority of the population and isn’t likely to get any serious political opposition (e.g. the government won’t fall). Your description of Malaysia suggests that the convenience/necessity/status(?) of owning a car take precedence over the cost, and that this portion of a driver’s total budget is considered a fact of life. In either case there is also the underlying question of the availability and quality of transit as an alternative.
It’s impressive to see how traffic speeds have been improved, but the article deals with a core area, and the island itself is only slightly larger than the City of Toronto (274 vs 240 square miles) with a population over 5m (compared to barely 3m for Toronto). Just the density makes the transportation system very different, and the bounded city prevents sprawl outward.
Changes in traffic speed (such as might be achieved by signal timing or other physical road changes) are generally one time improvements. Once you eliminate the majority of the “congestion” (however defined), there’s nowhere to go. Does Singapore face an influx of over 3m additional population over the next 30 years, and if so, how will they handle it? At least they are starting with the density they need, but if the number of cars is to rise at only 3% per annum (and that on a small ownership base), most of any new population will not be driving. Imagine saying that to potential GTHA immigrants.
So much of “acceptability” depends on what is already considered “normal” and the political hurdles involved in imposing change. Metrolinx and Queen’s Park must convince people of the worth and benefits of what they propose, including a demonstration of where and when the changes can be seen first-hand. Dragging the “first wave” out to 2021 was the dumbest move McGuinty made along with the complete sidelining of local transit issues until very recently. The Big Move is more like a Big Swiss Cheese, and if you live or work in the holes, it may as well not be there.
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Wikipedia says that the pre-amalgamation City of Toronto was 97 km2, or 37 sq mi. The current city (née Metro Toronto) is the figure you quoted, 240 sq mi.
Steve: Ooops. My mistake. You are correct. All the same, the population of Singapore would have to fit into a space the size of the 416, and there would be a hard (and very wet) bound on sprawl. I will fix my earlier remarks.
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A couple of things come to mind when comparing Singapore to Toronto.
Not only is Singapore’s density higher, cars can’t really go any further, as it’s mostly ocean. Contrast that to Toronto which sits inside a larger region, beyond which is ‘cottage country’ (at least the the minds of many city dwellers).
Being able to drive out of Toronto is becoming more important as more people live in the central city but work somewhere out in 905. It often seems to me that the Gardiner in the west end is busier westbound in the morning, and eastbound in the evening, than vice-versa.
And that’s a problem for the GO radial-commuter model. There are a lot more jobs close to Union station than there are reverse commuters within easy walking distance, and at the other end there’s no way to get to your job. And that presumes that the reverse-flow runs are operation.
Of course if GO was removed from the picture, I bet the eastbound Gardiner in the morning would be packed beyond belief. However, what is GO going to do to alleviate the reverse commute crowds?
Steve: GO plans all day, two-way service at better frequencies than today, but this still runs into problems with the “last mile” of the trip. Unlike Toronto where GO can simply dump riders at Union and let their feet plus the TTC do the rest, there is no equivalent at the 905 stations. Jobs are not clustered around the stations, and local transit doesn’t do a good job of serving them. If GO expects the local municipalities to beef up their operations, there must be a financial incentive.
Metrolinx talks about “Mobility Hubs” and development around GO stations. This runs into a few problems. First, not all stations are located where municipalities want development, or where there is a market for it. Second, the office/industrial base in a lot of the 905 is already established in road-oriented locations, and these areas are the force that draws “reverse commute” traffic as well as “region-to-region” trips. That demand won’t go away just because Metrolinx waves a magic wand over one of its stations. My gut feeling is that it’s more likely we would see increased residential growth around stations, but this simply reinforces the downtown-centric commutes and does not put jobs (destinations for reverse trips) handy to the stations.
Within Toronto we have seen the problems that arise from the creation of artificial “centres” such as Scarborough and North York. They have employment, but nowhere near what was predicted, and it has taken decades even to achieve what is there now. The Six Points has sat undeveloped until recently over four decades since it got a subway terminal. Many factors affect where development will go and the rate at which new jobs will materialize. Meanwhile we are faced with serving the demand pattern that evolved since the 50s based on expressways and cars, not a fantasy world where trips conveniently lie along existing or easily acquired transit corridors.
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The Singapore Model works for Singapore, the Hong Kong Model works for Hong Kong etc … and we certainly cannot import them wholesale into the GTHA. We can, however, learn from different models, look at the similarities and differences and understand what is more and less likely to work in the GTHA.
A good environment for public transport is one where there are natural or artificial limitations on driving and natural and artificial incentives that encourage public transport. Hong Kong (partly an island and both the island and mainland side are mountainous) and Singapore (an island) have already got natural limits that Toronto doesn’t exactly have.
So there are also artificial limits … both Singapore and Hong Kong make it very expensive to own a car … but so does Malaysia.
Which takes us to the investment in public transit … Hong Kong, Singapore and Malaysia all had private minibus systems in the 1970s. All attempted reforms, trying to replace minibuses with larger scale, regulated operations, 12m buses, fixed routes, schedules etc.
Hong Kong ended up keeping both types of buses, allowing minibuses to fill the space between taxies and buses. Singapore got rid of minibus routes but has a massive taxi fleet. Malaysia kept minibuses until 2004 (in smaller cities) and a massive taxi fleet, but still has a poorly-regulated private bus model that is completely unreliable.
To sum it all up, natural and artificial limitations on driving are all well and good but the best way to get people to reduce their driving is to provide public transit that is perceived as reliable.
What we can learn from Singapore is that they don’t just limit car ownership, they limit congestion by discouraging peak hour car use and providing excellent public transport (they have a radial system of buses and MRT trains) that is perceived to be reliable, fast and frequent. In Singapore driving is a privilege that you have to buy into, but public transit is more often the best choice.
What we can learn from Hong Kong is that development and public transport should be complementary. More importantly, public transport should be both available and reliable with a multitude of options for every conceivable trip or need.
What we can learn from Malaysia is that financial limitations on car ownership (high cost of cars) and driving (tolls, high fuel costs) are meaningless if people perceive that there is no other available option besides driving. Even if you build better public transport infrastructure and offer better service (and this has been done in Kuala Lumpur and other Malaysian cities) people will still drive because they have a poor perception of public transit (unavailable, unreliable, slow, inconvenient, confusing, unsafe).
In the GTHA we do not have natural physical limits to growth or driving (beyond, I suppose,the Niagara Escarpment and Oak Ridges Moraine). We cannot expect the government to put any limitations on car ownership or any significant, meaningful limitations on car usage, and we cannot expect that the increasing cost of fuel to make a significant difference.
The GTHA needs that missing public transit infrastructure but we also need that public buy-in … not only to pay for it but to use it. That means we need available, reliable transit options that work for local, medium and long-distance and even regional trips.
That is not exactly what the Big Move has on offer.
Cheers, Moaz
Steve: Would a moat filled with attack swans work?
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The other big problem is the way that local municipalities have divided up land into Single use zones in most of the areas GO serves (including those in the outer areas of Toronto).
Even before we had ‘sprawled-out’ auto-friendly ‘single zone’ suburbs, we had streetcar-friendly ‘Single Zone’ suburbs (the Parkdales, Kingsways and others).
Even today in Toronto there is grudging acceptance of mixed use development, with examples of ‘preferable’ commercial uses (small-scale retail and banks, nothing too noisy or diverse) and ‘unwanted’ uses (restaurants, places serving alcohol etc.)
The problems with single-zone development is that it keeps people away from the services they need and it increases the cost of providing the services (as this article on Peel Region’s underfunded social services shows).
I think the big problem with The Big Move is that we need to buy in to more than just an investment in transit infrastructure … we also need to restructure our city planning and our funding mechanisms (and in some cases, our lifestyles) … and that is a ‘Bigger Conversation’ that no one seems ready to host.
Aside from the problem of single-use zoning, that is probably being reinforced by an increased demand for office space downtown.
In contrast, there hasn’t been an office building built in Mississauga’s ‘City centre’ in 20 years.
This simply reinforces that The Big Move (and any future waves) is a great infrastructure ‘catch-up’ plan that will (hopefully) always be attempting to fix the problems and meet the needs of ’30 years ago) … a lonely process for Metrolinx that will happen without significant support from municipal governments or ‘the private sector’ and ‘the market’.
Cheers, Moaz
Steve: The great triumph and mistake of 20th century planning was single use zoning. Don Mills, the first “planned suburb”, took this approach and it was reproduced on a grand scale. And people wonder why they have to drive everywhere.
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I just had a strange thought this morning.
You said that there would be approximately $300 million per year available to local transit agencies as part of The Big Move revenue.
Now if we consider the number of transit agencies in the GTHA (HSR, Burlington, OT, Milton, MiWay, Brampton, TTC, YRT and DRT), if that $300 million were divided equally each agency would get approximately $33 million per year.
So let’s call it $32 million and ask each transit agency “what would you do with 32?”
But what could $32 million extra per year do for the TTC, GO bus and other transit agency operations? It seems like a small amount (especially for TTC or GO buses) but it would be useful nonetheless.
Cheers, Moaz
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I would argue there’s more nuance to fiscal conservatism than spending as little money as possible at all times regardless of circumstance (except for ones pet projects).
There’s ample proof that Rob Ford isn’t one to begin with. Sure he watches the pennies in the penny jar but he does so while watching dollars fly out the door. Someone who bleats about sandwiches for late workers being waste and gravy shouldn’t be advocating for things that would drain several orders of magnitude more money from the city budget when such things would benefit comparatively few people. It’s populism at its worst.
Even if I were to accept the idea that he’s a conciliator (something which I have seen no proof of from his 10 years in council) he’s not proving it by turning every vote into a wedge issue for the next election. Oh look at what Mark Towhey is spewing today!
That’s the other thing. Rob has a problem with the people that he surrounds himself with. His brother, Towhey and others are hard line ideologues and they are whispering the wrong things in his ear. I doubt compromise is a word that the mayor hears from them. Then we get to people like Nick Kouvalis… who is an unsavoury character to say the least.
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I just can’t understand why a property tax is not on the table.
It is what municipalities have used to raise money for infrastructure.
You don’t have to worry about regional issue as the money raised in the municipality goes to the infrastructure of the municipality.
You don’t have to worry about victimizing one group over another… we all pay. You don’t have to worry about transit users being hit by high fare increases or all the burden being felt by car drivers.
I get that property taxes increases are unpopular, but in my view, they are the most fair and reliable option in this respect. It should have been an option on par with a regional sales tax.
Steve: It’s a question of basic math. The total property tax income for the City of Toronto is about $3.3b annually out of a total budget of roughly $11b. The rest comes from various fees including TTC fares and transfers from other governments. This means that a revenue increase of $330m requires a 10% tax increase, assuming that the capital spending would be done on a “current” basis rather than borrowing. If we borrow, then there will be a growing future debt service cost. It is worth noting that although cities do pay for a lot of infrastructure, they get considerable sums from the provincial and federal governments. In Toronto, the capital program for Toronto Water comes out of a separate water bill, not from the property tax.
What has strangled the city’s ability to spend on transit as some of us would have liked has been the artificial tax freezes, or lower rates of increase than should have been implemented, over several years going all the way back to amalgamation. Even if taxes had increased with inflation, the city would be a lot better off financially today. We cannot make up for this short-sighted policy overnight.
Also, property tax, to the degree that it does fund transit, goes mainly to operating subsidies. The TTC desperately needs more service on the street, but this means more spending on operations, something that is within a modest growth in property taxes to handle.
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The proposed financing for Sheppard is laughable. The 2011 City Budget foresees $61-million in development charges for all of Toronto. How enough revenue could be generated just on Sheppard Avenue to pay for a $4b subway while leaving the street financially attractive to developers is a great mystery.
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