Stephen Rees's blog

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

Taxpayers get say on $18m transit levy

with 11 comments

Vancouver Sun

There is going to be a public meeting tonight in Burnaby. Translink wants to consult – about less than 2% of its revenues. They would have got that from businesses, but they balked and want homeowners (and renters too but they do not see it directly) to help pick up the tab. Because the BC Liberals in Victoria like to give the odd sop to businesses – unless they are in the way of one of their favourite projects of course.

Property tax is one of the worst ways I can think of to pay for transportation. Note too that in the minds of the subs at the Sun, it’s a “transit levy” – no matter that increasingly it is going to pay for roads. In fact for as long as I have been around Metro Vancouver’s transport issues, the common theme has always been that transport users should pay for transport – and that if the price they paid to use their cars and trucks – or buses and trains – were closer to their true social costs we might see a more reasonable distribution of trips between modes, and fewer vehicle kilometres travelled.

The one thing that is not going to be on the table for discussion is how $18m could be absorbed by budget cuts. And of course, the only thing that gets mentioned are things people want. I simply would not expect Dale Parker to talk about how the credit collapse – which is by no means a problem limited to the US – is affecting some of the P3 projects we are now stuck with. The Canada Line and the Golden Ears Bridge are costing much more because of the fallout of the bundled mortgages crisis. And we have already seen the Canada Line trim its project scope to try and stay within budget. And I have seen it suggested that it has also had a knock on effect of reducing available funding for other major capital projects yet to start.

He does say “And these [operating] costs have gone up 93 per cent in the past seven years” but he does not say how much unit costs have changed, because a lot of that increase comes from at long last actually expanding transit service – not that it is anywhere near enough and is certainly not increasing transit mode share the way it was supposed to.

The very rapid rise of board meeting costs will not, of course, be mentioned. Not by the Board anyway. Though you can expect a lot of puffing blowing about maintaining competitiveness in the market place for skilled talent. Which may well also be called to defend rapidly rising staff costs too. Not to mention the shortage of bus drivers. Nor what happens to a gas tax that is based on a levy per litre not percentage of pump price when those prices rise.

How many people going to this meeting are going to say “Yes, I would like to pay more property tax” ? And what do you think the outcome will be if 100% of them say no?

So I won’t be going.

Written by Stephen Rees

March 17, 2008 at 11:18 am

Posted in regional government, transit

Tagged with

11 Responses

Subscribe to comments with RSS.

  1. I don`t think much of the boards of (experts ) – the vancouver trade and convention center comes to mind! ( that was led by ken dobell ) the liberals spared mr dobell and shuffled his (expertise ) to social housing ! god help us– A board of experts,should be a group of transit users– I rode transit in the GVRD for a decade- with an aging populous wheres the bathrooms -there are none anywhere -why does a three zone ( 5.00dollar fare last ninety minutes ) when many times the first connection of a bus ride through gridlock has consumed my minutes! how come these experts have not adressed the problem of people liiving at zone boundaries -for example someone living near joyce station -to go one station east is a 2 zone fare! these experts want to spend 100million dollars to secure sky train from ( maybe three million dollars worth of fare evasion a year! as sure as god made little green apples- with these heavy handed tactics there will be much more CRIME -CAR THEFTS-MUGGINGS-BEGGING – most people don`t mind paying but if someone suddenly broke–or someones daughter (or son ) has over spent on a friday night- this will surely drive them to hitch-hike! On a more fundamental basis -property tax gas -gas tax-increased fares ( will not pay for a 14billion dollar transit plan ) the formula is flawed- the only way to pay for it is to– USE A BUDGET SURPLUS TO INFUSE LARGE CAPITOL INTO IT, BOTH PROVINCIALY AND FEDERALY ! ) but unfortunately our last surplus ( there will not be one next year! 100 million predicted ) gave -225 million dollar subsidy to big banks and 330 million dollar subsidy to big oil and gas ( with another 340 million for oil and gas next year! ) and also exempted oil and gas from the carbon tax– bc liberals led by campbell -and falcon, have diffrent priorities! I urge everyone to see through the smoke and mirrors! Its now just a stall tactic till the next election! just ask the people of surrey about their emergency room expansion (which hasn`t even a shovel in the ground yet! It was supposed to start in 2007 with completion in 2010 —2007 is gone and completion has pushed to MAYBE 2011– BC LIBS -PROVE ME WRONG ————to hell with the peasents –all that matters is the big money boys club oh gotta go –my 100% columbian coffee is calling!

    grant g

    March 17, 2008 at 12:27 pm

  2. The Canada Line and the Golden Ears Bridge are costing much more because of the fallout of the bundled mortgages crisis.

    But with a fixed price contract, those increased costs are in the hands of the private contractors. The government authorities are not running around trying to reallocate additonal taxpayers’ money for the projects – like was done for the Convention Centre.
    Sure, the private contractors will have to make up that money some how, but with fares and tolls set by the governmental authorities, they’ll have to do it some other way.
    Conceivably, the private contractor could go bankrupt, but as they did at the start of the project, they can raise additional capital, and if you criticize that the additional capital was from a couple of pension funds, those pension funds would analyse their investment choices before investing. They could invest in a shopping mall, for example (think ICBC investing in Surrey Place Mall and building an office tower, now hopefully the spark for Central Surrey), so I don’t see why they can’t invest in a project that will have substantial public benefits if the number look good. Besides, InTransitBC has too much riding on this – their contribution to the project is $700million (more than any single governmental entity).

    Ron C.

    March 17, 2008 at 4:17 pm

  3. From the article: “‘This is not a new tax,’ Parker, a former president of the Workers’ Compensation Board, said in a news release. ‘It is revenue that TransLink has already factored into its long-term budgeting.'”

    Talk about doublespeak. If you shift from a parking stall tax to a property tax, it’s still a tax increase. If hypothetically, the TransLink board were allowed to replace the parking stall tax with an increase in the fuel tax, would he be saying it’s not a new tax?


    March 17, 2008 at 5:46 pm

  4. You wrote: “Property tax is one of the worst ways I can think of to pay for transportation.”

    I can’t recall a post from you on this topic, care to elaborate? Since people live in the GVRD one way or another, it would imply that people living in more expensive properties would pay Translink relatively more than those living in inexpensive properties. This would also be implied in the rental rates so there is no escaping it unless if you’re homeless.

    Are you suggesting that Translink be funded out of the provincial general revenue fund? Or make it even more user-pay than it is currently?


    March 17, 2008 at 7:06 pm

  5. I believe that some base level of property tax is desirable because a good transportation system increases the value of one’s property. Increasing the property tax rate too much, however, becomes regressive because many homeowners with high-value properties have low incomes.


    March 17, 2008 at 7:12 pm

  6. Late last week, I participated in a random Ipsos-Reid telephone survey about the proposed transit expansions. After asking how important I felt expansion is, and how serious I think traffic problems are, the survey focused on funding. The proposed mechanisms were: a) increasing the parking tax (from 7% to 21% I believe); b) a flat $100 vehicle levy; c) a vehicle levy proportional to distance driven, averaging $100; d) a vehicle levy according to fuel efficiency, averaging $100; e) gas tax; f) increased fares (inflation or inflation+2% I think); g) a property tax increase (inflation or inflation+2% I think). The survey asked what I liked, what I disliked, and seemed quite interested in why. The researcher actually read my reasons back to me. (I liked the gas tax and vehicle levies. I was opposed to the property tax, as it is not an incentive to changing modes, nor does it connect to the use of services.) I wonder to what extent this was an attempt to choose a mechanism versus data collection to craft a communication strategy for an existing choice.


    March 17, 2008 at 7:24 pm

  7. Sacha

    The value of your property has no relation to the amount you use the transportation system. Someone who has moved out to the edges to find a cheaper property but continues to drive to work will certainly use the system a lot more than someone who can afford to live downtown and walk to work.

    The problem that we face is that we do not have enough resources to provide a good transit system – and property owners are highly resistant to paying more. In fact when property prices increase, revenues don’t follow as the rules of municipal finance do not permit that. Although Translink has done well out of property tax that does not mean it is an equitable or efficient system.

    I thought I had been pretty outspoken about my preference for user pay – especially as applies to road users. Any kind of subsidy distorts the market – and right now we have far too much road use and parking and not nearly enough transit. And I would lay the blame on the use of property tax.

    Because of the way that property prices work, and the fact that no one regulates how much anyone spends on transportation (as opposed to the rules regulations that surround mortgages) we over consume transport services. Especially since we do not pay to drive: we absorb most driving costs as fixed fees that do not vary no matter how much we drive – so unsurprisingly, we have an incentive to get as much use as we can out of our cars.

    To add to our woes, the gas tax is charged by volume not price – so the more people do the right thing, the less money we have for transit. Kinda dumb huh?

    Stephen Rees

    March 17, 2008 at 7:27 pm

  8. what I am trying to say is -the priorities of the bc libs are wrong–they exempted the big polluters ( oil and gas ) and subsidized them at the same time – do any of you believe oil and gas industry needs a subsidy–could not the 700million dollar subsidy for this and next year ( which was taken out of the 4billion dollar surplus )it could have been put toward capitol cost of the 14billion dollar transit plan! the (now spent ) 4 billion dollar surplus IS EXCESS TAX THAT EVERYONE IN THE PROVINCE HAVE PAID! if we can pay 1.5 billion dollars for olympic security ( out of bc tax dollars ) we can put it into transit– translink( the bc goverment ) hasn`t a hope in hell of raising 14billion in dribs and drabs! either we are serious or were not! hell even if bc lottery was to pay for translink expansion,with all its income it would still take decades! you all disapoint me– just like a decade of federal liberals promising daycare–as well as a decade of stalling kyoto accord! talks cheap BC LIBERALS PUT ( OUR ) MONEY WHERE YOUR MOUTH IS! signed————–reality

    grant g

    March 17, 2008 at 9:07 pm

  9. one more thing -if any of you have read bill 43 (greater vancouver transportation authorization amendment act 2008 ) ie; the new translink board————————————–the way the act is written if they raise transit fares ( which they did ) they also HAVE to raise gas taxes and property taxes, its a three for one option only! so thats what they have done -raised fares–raised property taxes (not counting this replacement tax ) and raised gas tax!——-in the future,because it still won`t be enough ( not near enough) everytime they raise one it has to —“by law ” it has to be all three raised in conjunction! TAXATION WITHOUT REPRESETATION —–BY A UN ELECTED board of kevin falcon appointees– the mayors council got to pick this board –out of 15 names kevin falcon supplied! and the mayors cannot overrule anything this board decides! these experts also have the power to tax outside of the gvrd—they also have the power to toll every crossing in the province old or new–the power to tax welfare cheques (social service tax ) tax ferries! rail ! BECAUSE WHAT YOU UNIMFORMED DO NOT REALIZE —THIS BOARD OF GOVERMENT HAND PICKED EXPERTS –IS IN FACT A DEFACTO TAXING AGENCY———BECAUSE CAMPBELL AND FALCON DO NOT WANT TO TAKE THE HEAT– ENJOY THE 5 billion dollar olympics– and say a prayer for tibet–and give some food to the food bank— and when we fall into recession this and next year –there will be no surplus for anything—–so we had a chance with full coffers to improve society,but oh-no we blew on a 2 week party that most of could not afford to attend ( and we weren`t invited ) signed……reality

    grant g

    March 17, 2008 at 9:43 pm

  10. […] maybe we have become cynical. And thought that attending a meeting about an issue that has only arisen because the Province listens to businesses (mostly) was a bit of a waste of […]

  11. I would suggest that with climate change and peak oil having the potential to affect the national economy, a national transit strategy should be developed … meaning the feds should get involved more than they currently do. They rely heavily on income, business and consumer taxes for revenue, not property taxes, and have the authority to impose a transit levy across the country. Dare they convert existing tax revenues from many departments — perhaps the GST — as well as oil subsidies and establish a new transit and health care tax / levy that is transparent? I personally would like to see more transparency. Funding from general revenue can hide a multitude of sins.

    The constitution places cities under provincial jurisdiction (along with health care), and look where that has gotten us. ‘Patchwork quilt’ comes to mind. I contend that only a foolish city or provincial government would block or turn down billions for transit under a contractual, negotiated deal directly with the feds even if its’s outside the constitution.

    The feds could demand cities build denser, energy self-sufficient transit-oriented communities with urban design guidelines and agree to be audited on their progress over, say, a decade in return for supplying the transit and perhaps some grants for self-sufficient energy projects (eg. solar-assisted district heating plants). If a city balks at eliminating the zoning that creates single-family sprawl the gobbling up of vast tracts of agricultural land, or a province says get out of our constitutional jurisdiction, then simply withdraw the offer, and explain the environmental and economic consequences of doing so.

    The reality is that the local draw on a federal contribution of a billion dollars is very low.


    March 18, 2008 at 3:04 pm

Leave a Reply

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

You are commenting using your 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 )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: