Below The Line

TTC capital spending plans suffer from a basic problem: political support for funding of routine maintenance that doesn’t have ribbon-cutting, photo-ops and election prospects has been falling for years. During the same period, demand for transit service, not just for shiny new lines, but for seats on buses, streetcars and subways, has been climbing fast. Two to three percent a year might not seem like much, but when many services see no improvement, or even deliberate cutbacks, things get tight.

This is not news. The shortfall in funding the TTC’s ten-year capital plan was foreseen some years ago, and it appears regularly as part of the City of Toronto’s budgetary handwringing about the growing backlog of work. There is always hope that a new formula, a more enlightened attitude at Queen’s Park or Ottawa, will bring new money to transit and solve this problem once and for all. Meanwhile, the shortfall is, to the degree possible, pushed off into later years of the plan so that the TTC can do the maintenance and rebuilding it needs.

That, at least, was the idea a few years ago, but those “tomorrows” are now “todays” and things have not changed much.

The first problem is that the only consistent revenue stream Toronto now receives from other governments is a share of gas tax, and this is a fixed amount, one that could decline due to population shifts and reduced use of fuel. Over the ten years 2015-2024, no increase in this tax stream is included in the TTC’s budget with the obvious result that gas tax as a portion of transit spending will continue to fall in purchasing power.

The second problem is an ideological standoff over revenue tools. “Give us more money” says Toronto, while Queen’s Park replies “We gave you revenue tools, use them”. This is the same Queen’s Park that is scared to death of using its own taxing powers to fund better regional transportation systems. All governments tell fairy tales about the magic of Public-Private-Partnerships and Tax Increment Financing, schemes designed to hide the fact that costs we should pay today would be financed by borrowing against the future, but in a way that doesn’t use that dirty word “debt”.

This is not a happy situation, but the debate becomes more complex when we actually look at those unmet financing needs of the next decade and beyond. Are all of the projects now on the books reasonable? What is missing? Would additional funding, if it were available, be spent wisely?

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