Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

Transportation Funding in Metro Vancouver: Mayor Richard Walton today’s Carbon Talk at SFU

with 4 comments

I suppose I could have sat at home and watched the live webcast, but as I had just finished this morning’s post I saw a tweet about the talk, and decided to go. I need to get out more, and I should not let a little thing like a Pineapple Express deter me. I am pleased to report that people were following the webcast and tweeting in questions (you can follow Carbon Talks too). And if this report seems inadequate, or you want to check its reliability, the whole thing is now available on video.

In May last year the Mayor’s Council approved a set of 13 Guiding Principles for Funding of Regional Transportation and these were printed and distributed around the lecture theatre.   My eye was caught by no 4

“Revenue sources should provide pricing signals to link desired user behaviour to overall transportation objectives.”

It seems to me that sets the tone of the discussion since it clearly puts defenders of more property taxes on the back foot. However, as Mayor Walton acknowledged, you do not want to be too successful at this since of you deter people from driving by raising the gas tax (or imposing a carbon tax) you increase demand for transit at the same time as reducing its funding.

He opened by observing that Translink runs “one of the best systems in the world”. He acknowledged “it’s got a little edgy lately, since all power lies in Victoria. ”  He put up slides showing the present Governance Structure – which is complex but pointed out “We [the Mayors Council] appoint the Board”. It is at the policy level that accountability is unclear since the Board, Mayors Council. Commissioner and province are all involved – but are all “in separate boxes”. The current review of the structure notes that the following attributes are all required Accountability, Advocacy, Transparency, Responsiveness, Clarity and Productive Relationships. They are all supposed to mesh – but in some respects Translink does not match up well to the four cities Ken Cameron and Clive Rock decided to compare us to – Brisbane, Stockholm, Vienna and London.

The funding context is that Metro Vancouver is still experiencing growth in both population and its economy but demand for transportation is growing faster than either, and the current portfolio of funding sources is not keeping pace (6% growth in population, 17% growth in transit use). Both the gas tax and property tax were said to be “maxed out” and had a declining share of the total. Fares now account for 40% of revenue [compared to over 50% in 2004] Direct user fees that are proportionate to transportation use (fares, gas tax, parking tax) account for 72% of revenue, indirect beneficiary fees (like property tax) 28%.

The province has stated that its priorities for new revenue sources are affordability for families, regionally based, support for the provincial economy and benefit capture. Mayor Walton stated his position that “the rest of the province should not have to support Translink”.

Looking at potential new sources was, he said, not so much looking for a silver bullet as silver buckshot. There has already been an evaluation which puts at high status on the carbon tax, fuel taxes, the parking sales tax (which though small is very unpopular with impacted businesses) The vehicle levy would join them except that the province has three times already “shot down” proposals to implement what is now in the Translink legislation. The idea of a regional sales tax got added at the last discussion as even a small increase would collect such a large amount of money: an extra 0.1% on existing sales tax would collect $50m in Metro. Sales taxes are widely used to fund transit in the United States. (He said “North America” but I think this term I use is more accurate.)  He also speculated about a conversion of HOV lanes to HOV/Toll lanes (single occupant vehicles permitted for a fee by distance). He spoke warmly about road pricing as the closest to a silver bullet but said it would be a 3 to 4 year “voyage” to get that established – which does not fit provincial election timetables. He also said that land value capture  could only be applied to SkyTrain as it has much more impact on density and land value than, for instance, increasing bus service frequency. Gordon Price demurred thinking that BRT might qualify.

“Germany leads the world in transit governance” because all the stakeholders get a seat at the table rather than occupy silos as ours do.

Q&A

Eric Doherty made the point that the funds apparently available for the Massey Tunnel replacement would be more than enough to build the transit system we need.

In a discussion of the development levy, I pointed to the experience of the TTC and the Sheppard subway (developer fees were abandoned, when the developers said they would simply move their projects beyond the TTC’s territory). Gordon Price agreed that this had been the experience in Surrey where development cost charges in Surrey City Centre after the last Expo line extension saw development go elsewhere. Jeff Megs observed that they do work in Hong Kong, but only because the transit agency is the developer, and the density increases are huge. He did not think that similar density increases would be accepted here, and besides the City already captures much benefit for other things such as community centres and day cares. He  observed a “personal income tax increase is also not going to happen” [up until then, no-one else had mentioned them.]

The province is convinced there is room for an increase in property tax [because other cities pay more] but Mayor Walton said this is contrary to the affordability for families principle. And in any event local government in general only gets 8% of all taxes collected but delivers a wide range of services. Their only other source is fees “and it is political death to raise user fees” about which voters feel even more strongly than property tax increases. Jeff Megs stated that the Translink legislation caps the contribution made by property tax, but said that Adrian Dix has gone on record as willing to consider using the carbon tax to pay for transit.

One questioner suggested that people would support charges that clearly benefitted their area. If the fees collected were earmarked for projects in their community, they would support them. Mayor Jackson of Delta has consistently reiterated that Delta pays for more for Translink than it gets in transit service.

In response to another question Walton identified the central problem for governance as a lack of trust. “I don’t  understand where these perceptions [in Victoria] come from.” There is, he noted, a hesitancy to come to the table – and emphasized that this was not partisan it was equally shared by NDP and Liberal governments alike. “I think if you fix the governance trust issue, the funds will flow.”

Gordon Price observed that there were two different standards for transit and road funding. The freight industry just goes straight to the top and gets what it wants with debate. Road building – the new Port Mann and the replacement for the Massey Tunnel proceed simply due to measurements of delay. The projects are said to be justified by time savings – but transit is said to be inefficient, and costs must be saved by increasing delay to users through lower service levels. He said the Translink Board had similar priorities when the Patullo Bridge project did not get cut when bus service was.

Nancy Oweiler responded that “the Patullo Bridge is not a done deal. We have no way to fund it. But we do have to be concerned about some very basic public safety issues.” The recent audits had all said that Translink was doing well but there is always room for increased efficiency. She said – humorously I think – that it would be a good thing is Translink could impose “secret fees” like the airport does.

It was confirmed that no-one from the province was actually in the room.

REACTION

I pointed out to Nacy Oweiler that the Airport Improvement Fee was not a secret when first imposed – and is propelling airport users to seek cheaper flights south of the border. I also tackled Jeff Meggs who reacted “Why so angry, Stephen?”

The answer is that I was appalled that the NDP appears to have abandoned the idea of a progressive taxation system. He said that personal income tax already pays “for many good things” and thus  could not be diverted to transit. He continued that the NDP has no intention of removing the MSP as it collects such huge amounts of money. I retorted that was one of the main reasons for replacing it. It now collects more than Corporate Income Tax but like all flat fees was desperately unfair to those on lower incomes. The rich really do not care very much about flat fees as they have such a limited impact on them.

It seems to me that the NDP is indeed committing the same errors of New Labour in Britain – so anxious to get elected that it has moved to the right, and in this case needlessly. The present government will fall as it has demonstrated how hopelessly incompetent and compromised it is. The “ethnic vote” scandal merely being the latest of a series of blunders. The voters want a different government, and would hardly be deterred even if the NDP was in fact still socialist. Instead Adrian Dix is doing his best to be reasonable. I am sure Jeff misspoke when he said they would cut corporate taxes – I am sure he meant restore to the levels before the last round of cuts – but such a thing is not inconceivable. The NDP appears to be as enamoured of LNG as the Liberals.

I believe that Richard Walton is indeed sincere when he says that he is non-partisan. I also believe he is fundamentally wrong in his understanding that there is no benefit to the rest of BC to have a decent transit system in Vancouver. National tax revenues support transit systems in the major cities of every other nation on the face of the earth. I am absolutely certain that you would never hear a Mayor of a Parisian suburb stating that the people of Perpignan should not have to pay towards the RATP/STIF. Actually, a lot of their funds come from a regional employment tax, but we didn’t talk about that either.

I wish I could feel happier about the outcome of the current governance review. Three of the four cities chosen seem fair comparisons – but London? Really? The scale alone is different. And it is the national capital of a major power – albeit one in steep decline.

The present system is a mess – and I think a lot more needs to be done than tinkering with current structures. But then I also cannot possibly endorse the sentiment that Translink runs “one of the best systems in the world”. Words fail me – but I wouldn’t mind betting the regulars will have some figures to show how laughable that statement is.

Written by Stephen Rees

March 1, 2013 at 4:58 pm

4 Responses

Subscribe to comments with RSS.

  1. It is only natural for a local politician to be proud of the metropolitan area where he lives, but to say that our TransLink is “one of the best system in the world” shows how little he knows about transit.

    A great system is one that covers the whole metropolitan area with several types of rapid transit. This is done in Toronto and Montreal with subways and commuter trains, buses (plus trams in TO) servicing the areas between rapid lines. Not perfectly, but well enough.

    Mentioning London is beyond ridiculous of course…the only link with London is that the Oyster card was partly implemented by Cubic (the smart cards themselves were provided by Gemalto, one of the top leaders in the smart cards industry, and their associates in the project).
    By that time other towns around the world already had a transit smartcard system…Seoul then Hong Kong then Gatineau (Quebec province) implemented theirs in the late 1990s, Paris and several Japanese towns did it in 2001.
    ,
    Vienna, Stockholm and Brisbane were perhaps chosen because their metropolitan population is similar to Metro Vancouver. These 3 cities–and London–also have fare zones, unlike major cities in France that only have one zone–including Lyon that has about 2 million plus in its Metro area.
    Paris has zones but is reducing the number of zones every couple of years, with the goal of having one zone only.
    Portland when from 3 zones to one last September. The monthly pass for adults only cost $100..

    The goal of a good transit system is to attract customers by being economical enough that they will leave their cars at home during their workweek.

    Vienna and Stockholm are typical of many European cities over 2 millions. They have subways in the city, relatively short distance commuter trains to the farthest suburbs, then regional trains that are also commuter trains. Plus buses and tramways.

    Stockholm is said to have fairly high fares and is trying to implement a transit smart card system but has run into troubles.
    Vienna, like many German cities, doesn’t appear to have (or want?) a transit smart card system..(smart card is a generic term..there are lots of different types of smart cards. I still have one smart card from the 2nd or 3rd generation, a phone card with chip issued in the 1980s).

    Brisbane has commuter trains and buses, some of them being rapid buses running on elevated viaducts, ugliest than sin (some sins—mine anyway–are quite pretty). Have a look at:

    http://www.humantransit.org/2009/11/brisbane-bus-rapid-transit-soars.html

    Brisbane does have a transit smart card. Their transit authority is called TransLink…

    The major problem with our TransLink is that the municipal and provincial politicians do not know the first thing about transit as they don’t use it, and likely have never used transit in other towns.
    .
    In many towns with a truly good transit system–relative to the size of their metro area—the municipal and regional politicians are involved, just like in Metro Vancouver. They don’t always agree with one another, being from different political parties. What they do have in common is their knowledge of transit as they have used it before being elected–and may still use it still.Their family and friends likely use it as in many places public transit is as normal as breathing and walking, and much more practical than trying to find a parking spot within one kilometer of where one is going…

    Re the FARE GATES in SkyTrain stations that I talked about in a previous post:

    I was told very recently by someone from TransLink (we all have seen him on TV at one time or another) that the gates open both ways so there is no point having some gates used for entrance to the system only and having other gates for exit only.

    I disagree, based on my daily experiences since the gates have been installed.
    The gates are presently left open, but when 2 people come close to a gate at the same time one must wait for the other to go through.
    At rush hours, when several busloads rush to enter Lougheed Town Centre station at the same time as 1 or 2 SkyTrain unload passengers that rush out to jump on a bus, there is already a bit of a confusion.

    What will happen when 2 lines at opposite sides of a gate will want to enter that gate?

    The TransLink person told me the staff monitoring the stations remotely will be able to have gates open one way only, if needs arise…

    Surely the reason why so many transit systems around the world have entrance only /exit only gates is because it is better and easier for passengers.
    In other systems I have used at rush hours the gates never close fully between passengers as the passengers come marching in /out of a station at a fast pace, nearly a run…Having dedicated banks of gates is definitely a better idea…

    I swear that if TransLink decision making staff had heard that the rest of the world had been using for a while some weird device called a wheel, they would have come up with a square one.

    Red frog

    March 3, 2013 at 10:39 pm

  2. This is still the best place to learn about transportation technology… Stephen when elected officials or senior managers have asked me publicly ‘why I sounded so mad’ it has turned out that they were on their way out.

    La grenouille rouge— great explanations. The tid bit I also picked up here—that if we made transit free, the system couldn’t handle the load—speaks volumes to me. The question is not about how ‘low’ to make fares, but rather how ‘high’ to keep them.

    On the fare gates, systems analysis somewhere must have already laid down a law that the removal of ambiguity from systems produces optimal flow conditions. Thus, gates that are both/and exit & entrance will disrupt flow. The likely answer is that it takes more space and more gates to provide both entrance and exit capacity at peak. However, that just begs the question ‘what kind of system are we building’?

    I’m going to stay away from speculation on system choice and urban form, as if one determined the other. There is only one urban form that is best suited to urbanization. It has transit as a requirement not an option (London has it about right). However, there is little chance that a technology choice will trigger ‘good’ urban form. The kind of transit provided either raises or lowers our valuation of urbanism.

    Divergence from this line of presentation is bound to be politically coloured.

    La grenouille rouge’s—A great system is one that covers the whole metropolitan area with several types of rapid transit— gets ‘good’ transportation about right. In the final analysis it is a concrete and measurable thing.

    Finally, to this “one of the best systems in the world” boast … clear sign the speaker doesn’t get out much, to be sure. Our transit has improved and is getting better. But with miles to go…

    lewis n. villegas

    March 4, 2013 at 11:06 pm

  3. I would agree with Nathan Pachal that the mayor’s 13-point manifesto has it about right as an equitable philosophical basis for system governance and funding. Unfortunately they are as liable to be parochial and “us and them” as anyone else. It’s clear that representation from local, provincial and federal levels of government are required at TransLink as there are expectations of funding balance in each major transit project (typically 1/3 each). But in practice the province uses TransLink as a whipping boy and object of scorn and criticism, which makes those of us who have seen its actual evolution very cynical, because TransLink is in reality the progeny of the province. How childish, this tactic of ridiculing another in order to elevate yourself. And how effective this strategy has been in the eyes of the public, too many of whom leave immature comments on sites like the CBC in related stories in the vein of “dump TransLink” without really understanding what has occurred, or how important transit really is.

    Whether revenues for transit in our nation originate from carbon taxes or income taxes is not that important to a people interested in strengthening the public realm and preparing for climate change adaptation and steep increases in the price of fossil fuels before this decade is done, as long as they are implemented fairly (e.g. graduated to income, rebates to lower incomes, etc.) and accompanied by cuts to subsidies to wealthy industries. We live in one of the richest societies on Earth. Griping about higher taxes while on hold purchasing Canucks seasons tickets, or after several beers in a pub with the family’s third mini van parked outside, or about paying sales tax on top of the credit card debt accumulated on excessive quantities of expensive but impractical entertainment-based electronics, cannot be justified.

    With 60% of BC’s population concentrated between Vancouver and Hope, new governance models with long-term, stable funding commitments by senior governments and well-thought out local revenue policies is completely justified. It’s clear an elected regional board with voting representation from senior governments is necessary. Those who expound that Metro Vancouver already gets “to much” and it’s time for other communities to receive their “fair share” are obviously ignorant of just how much the Metro underpins infrastructure and programs throughout the province. Some say that Metro is a cash cow for provincial and federal coffers and doesn’t receive an equal return. Even without seeing an analysis beyond anecdotes, I tend to agree. But that doesn’t mean that every city in the province should be excluded from participation in policy making to make our cities more resilient to cope with 21st Century challenges.

    Councilor Geoff Meggs brought up the Hong Kong model of financing rapid transit. While his statement that we’re not ready for HK densities rings true, the idea of reasonable per unit annual charges for transit-oriented development within a reasonable distance of rapid transit stations shouldn’t be tossed. Many of the residential units will already be benefitting from having the $50,000 cost of an underground parking space deducted from the unit list price (added to the significant savings of not having to finance and operate a car), so I’d argue that $10-15 per square metre per year won’t break the bank and would result in a steady revenue stream in perpetuity. Some of the most efficient, high-frequency rapid transit lines make a profit as ridership builds over the years, but this real estate charge should not be discontinued or tinkered with beyond keeping it level once the finances turn that corner because of other needs and services within the system.

    Just a side note, though he is not perfect in several respects, Adrian Dix, who lives in the Joyce Station area, is a regular SkyTrain commuter. Christy Clark is the latest iteration of many powerful politicians on the government side who don’t use transit and don’t get it, but who continue the longstanding tradition in this wise province of dropping billions of tax dollars on freeways and northern energy megaprojects without question. We never hear from or see our federal MPs locally except in photo ops where a few nickels are dropped onto projects of marginal importance, and go into hiding when exercising questionable budget cuts. We may actually need $4/litre pump prices to light a fire under politicos to get cracking planning and building better cities, but by then it may be too late because the economy will be in tatters.

    Therein, there comes a time when we have to calm down and concentrate on making our own choices for our own families (e.g. live close to everything, pay off debts, plan for aging, buy a bike, support local farmers, and blog away) and let the cards fall as they may.

    MB

    March 5, 2013 at 10:32 am

  4. […] fill my blog with lecture notes. You can now compare if I am any good at them by looking at the Carbon Talks video and my blog post. I confess I have already filled in one gap when my scribble was unreadable – […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow

Get every new post delivered to your Inbox.

Join 1,067 other followers

%d bloggers like this: