Posts Tagged ‘property tax’
TransLink audit complete
Instead of giving you a link to one of the mainstream media stories this one takes you to the BC Government “Newsroom”. This both avoids the problems of media paywalls and the idea that the media are responsible for the “spin” in news coverage. This press release and its supporting “backgrounders” have all the spin.
For those of you who are new to this (is there anyone who fits that description?) Translink, the Region’s Mayors and the province have been arguing about how to pay for much needed transit expansion in the region. In fact this discussion has been going on for many years – at least the last 20 years, probably longer. Vancouver and its suburbs constitutes the only major metropolitan area in BC. There really is no other major city. Its needs are therefore different to places like Kelowna or Kamloops. It is not just a matter of scale, its a different kind of place, with a different kind of economy and quite different patterns of movement. The growth of population alone poses a challenge – but at the same time most of the region is the typical large North America suburban agglomeration. “Zurich surrounded by Phoenix”.
A day after I wrote this post the Georgia Straight posted this video. It shows “one weekday (from 4am to 4am) of transit activity in Metro Vancouver, based on the General Transit Feed Specification (GTFS) data made available by Translink”.
See what a good system there is in Vancouver – and how thinly stretched it gets south of the Fraser. I have inserted it since it nicely complements the point made above.
There is a unique arrangement to run and pay for transit here. Half of the non fare revenues are supposed to come from a provincially collected regional gas tax – but changing travel patterns (in part due to higher gas prices) have not only increased transit use but also reduced transportation fuel sales. Oddly enough, there is plenty of federal government supplied gas tax revenue – but that can only be spent on capital projects and has to be matched by both province and region, so much remains unspent. At the same time, a fare concession to post secondary students has boosted demand and thus increased operating cost – which turned out be more important than the “revenue neutral” formula its price is based on.
Translink has thus had to put much of its agreed long term plan on hold. It has cut service in order to shift resources around the system to the parts that are overcrowded. At the behest of the province and provincially appointed Commissioner it has sought – and found “savings” all over the place. Meanwhile the region’s Mayors and the provincial Minister of Transport have argued about new sources of funding. The province has always maintained that property tax could be increased – because that is what the Mayors control. The Mayors say, quite reasonably, that property tax has little relationship to transit spending and that they only get 8% of all taxes levied on households – but voters in municipal elections hate property tax increases. And anyway Translink has had other potential sources of revenue provided for in provincial legislation – like a vehicle levy – which the province refuses to collect. While the previous Minister promised to consider another funding source, this was conditional on a “temporary” property tax increase while it could be formulated, consulted on and then implemented. Then the prvince reneged on that agreement and the Mayors threatened to rescind the property tax increase. If they do that, Translink will have to cut service even further.
So the present Minister has been saying that she cannot even discuss a new funding source until an audit has been conducted – ignoring all the previous audits and studies. Now that audit has been completed – and it turns out that she has already been sharing its results with Translink, and many of its proposals have already been implemented. So despite the claim that “significant savings” have been found they only amount to $41m – compared to the $98m already identified. And anyway are nowhere near enough – “still not enough to meet the future transit expansion needs of Metro Vancouver.” So basically the point of the audit was to delay and prevaricate. And the “next steps” are to delay and prevaricate some more.
Once the long-term regional vision has been developed, the mayors and TransLink will be in a position to go back to the public to discuss cost and how to pay for it.
The only word I can use for this is “chutzpah” . There has been a long term regional vision for as long as I have been here. The province simply decided to override it. There was going to be a compact urban area, with complete communities which protected the green zone and increased transportation choice. Instead of that a series major highway expansions is increasing sprawl, destroying the green zone and ensuring continued car dependence for the majority of the region. “Transportation choice” for three quarters of the population is Hobson’s choice.
Government needs a clear sense of the regional vision and priorities over the coming decades, what kind of transportation system will be needed in the future and how much residents are prepared to pay for it.
A practical discussion can then be held about possible funding tools.
In other words, we can put this off until after the election which has to be held in May 2013, which we are almost certainly going to lose, and then its someone else’s problem. In the meantime, the staff at Translink and the Mayors will take the heat for the increasing inconvenience and disruption on a transit system that is unable to meet the demands placed on it.
The TransLink audit is available on the Ministry of Transportation and Infrastructure website: http://www.th.gov.bc.ca/publications/reports_and_studies/Review_of_TransLink.pdf
One of the reasons this blog post did not appear yesterday is I then took all this seriously and actually read it. It is a complete waste of time. The only “savings” are further service cuts.
There is also this highly misleading graphic
The province has always wanted more property tax for transit in Vancouver. That is the reason why I wrote those paragraphs of introduction. What this graphic does is pretend that somehow residents of Greater Vancouver pay less in taxes for their transit than they do in Toronto, Montreal or even Victoria. Of course there is no mention of the Translink gas tax – that is only collected in Greater Vancouver (by the province, as I pointed out). Nor the hydro levy, come to that. And the fact that “roads and bridges” were all downloaded onto the municipalities – and the gas tax was originally offered as a way of putting pressure on to them to sign up to Translink. They were going to get them downloaded anyway – so they might as well get on board with the provincial government’s proposed regional transportation authority if they want some new funds to help pay for that.
If the Mayor’s refuse to implement the property tax increase, then some of the province’s preferred schemes cannot proceed – such as the (much reduced) rapid bus over the new Port Mann Bridge.
None of this performance is anything to do with “long term vision”. It is all about short term, political expediency. There always was enough for the plans that the region agreed to. It was just that the province
chose to spend on highway expansions instead. We are stuck with the widened Highway #1, the South Fraser Perimeter Road and the widened Sea to Sky Highway. All of these are already contributing to an ever wider spread of suburban sprawl. “Expertise in land-use planning” has never been in short supply. We have had lots of regional plans and all our Official Community Plans have been crafted to fit into that framework – and much good has it done us (that’s irony, by the way). Port Moody, for instance, built a whole city centre around the idea of Transit Oriented Development. The Evergreen Line will now be built, many years after that development was halted, due to lack of transit service. Surrey has been asking for light rapid transit for years – and it might see a truncated BRT, if the other Mayors swallow their indignation at being treated so shabbily.
I also wonder about the timing of the release. After all, there was another event last night that was guaranteed to fill up the front pages and keep the political pundits occupied. Maybe they thought no-one would notice.
2c for your thoughts UPDATED
When the news radio called me about the Mayor’s “decision” to ask for 2c on the gas tax to pay for the region’s share of the Evergreen Line, I did not think I had much to say about it. After all, it was merely a recommendation – and would have to survive the summer and some public consultation. I recognize that the summer is a slow news time, but the amount of coverage this proposal is now getting is surprising me, though not the level of the “debate” so far. Perhaps the least expected contribution came from BC’s answer to Sarah Palin.
“When British Columbians say that they’re not really excited about paying more gas taxes, I get that. Because my focus as Premier is how do we make life more affordable for people rather than less affordable,” she said.
The Mayors were given very little leeway: they have to come up with a payment from this region’s taxpayers since the province and the feds have both already committed at their level. Since the current levels of taxes collected by Translink are only enough to keep on a current levels, the only way to raise $400m had to be an increase in currently permitted taxes. There is no time left in the funding agreement to come up with a new source so it either had to be property taxes or the gas tax, and the Mayors had made clear from the outset the very cogent reasons why property tax was not going to be the way they did it. Indeed, quite why our Premier thinks that the people of this region will like to see their property taxes raised is not exactly clear either. There is a $400m hit to our pockets and the only question is what is the most sensible way to do that. Property tax increases are no more “affordable” than gas tax increases.
As Geoff Meggs points out this also shows some lack of co-ordination inside Christy’s cabinet. Doesn’t she talk to her Ministers? Or is she deliberately trying to weaken Lekstrom?
The Sun gets itself into an interesting position “Transit taxes odious but necessary for growth of our city”. The link says that it is a “story” but there is no by line and it reads like an editorial. They sum up
“In the past, the province has stepped in and vetoed transit fundraising plans, including an earlier vehicle levy and a proposed parking stall tax. We hope that doesn’t happen this time.”
But Christy does seem to be ready to repeat the steps taken by the last caretaker premier, Ujjal Dosanjh – who went down to a stunning defeat in his last provincial election despite his last minute, and probably illegal, rejection of the vehicle levy.
For those of you who are of a mind to stick to the “no new taxes” mantra just take a read of what happened in California when they slashed their car tax. It is becoming very clear that the right wing belief that leaving money in tax payers’ pockets is the right thing to do in any set of circumstances is just that: a belief. Some people believe in Santa Claus too. Faith is holding on to a belief despite all evidence to the contrary. I have always been very much impressed by the American constitution’s requirement of a complete separation between church and state. What I cannot fathom is the right wing’s ignorance of why that is so important.
Added July 13
Blair Lekstrom is now saying that “he has the full support of Premier Christy Clark in agreeing to Metro Vancouver mayors’ plan for a two-cent gas tax increase for TransLink.”
“I stand behind what I’ve committed to,” Lekstrom said Wednesday, adding he has spoken with the premier and ensured they’re both on the same page.
“Nobody likes new taxes – I would concur with that.”
But he said the mayors can count on the province legislating the fuel tax increase this fall – as he promised – provided mayors formally vote for it in a pending financial supplement after public consultation and review by the TransLink commissioner.
“I will not waver one inch,” Lekstrom said. “This has gone on far longer than I think the public wanted.”
Clark has also penned a letter to mayors pledging her support, he confirmed.
“Mayors consider raising taxes to pay for TransLink”
The Vancouver Sun headline is deliberately misleading to attract attention. One Mayor – Peter Fassbender – is anticipating what might happen at a meeting next week. Nothing in the story is news, and nothing in the story suggests that any other Mayor has supported this idea publicly. The provincial government has made it very clear that it wants property taxes to rise to pay for the Evergreen Line. They have been very clear about that. Fassbender has been talking up the role of the Mayor’s Council – but basically the province is not at all interested in making the Mayor’s lives any easier.
Martin Crilly puts out a report – which is fine – talks about road pricing. But that isn’t going to happen – and couldn’t happen fast enough anyway to dig Translink out of its present hole. No-one needs to listen to the Transit Commissioner: he is irrelevant.
The gap between the gas tax inside the Metro boundary and just outside it is already large – and is a gift to gas station operators on the outer edge, since they can appear to sell cheaper gas. But the difference between a gas station in Aldergrove and one in Abbotsford is much less than the tax difference in the two jurisdictions. The government is so unpopular now that it could almost do anything it likes without making matters worse – but since Gordo got back from his holidays, the mood has changed. He obviously wants to get his own ratings up – and, bafflingly, he seems to be succeeding. No-one ever went broke underestimating the intelligence of the public. Of course the spin would be to blame the tax increase on Translink – but not nearly enough people would believe that – would they?
I think Fassbender is trying to soften people up for the increase in property tax which is about the only option left open – other than saying no to a new transit line once again. Last time the Mayors did that they lost control of regional transit. Not many Mayors outside of the north east sector are willing to see their voters’ taxes increased to pay for the Evergreen Line – and certainly none south of the Fraser where transit remains undersupplied after ten years of regional “direction”.
“We have a window of time to either come up with our commitment or the government will have to do something else,” Fassbender said. “[A financial supplement] is the only way we can come up with our share. What it looks like I don’t know yet because it hasn’t been developed.”
That sounds a lot like capitulation to me
UPDATE
It is worth taking a look at Frances Bula’s blog – she seems to be talking to the Mayors, although only Corrigan (of course) was willing to go ont he record. The real difference is to what is above is their perception that new sources of revenue (something the province was NOT willing to discuss before) are now “on the table”.
“I don’t think we’re caving to anything,” said Langley mayor Peter Fassbender, the chairman of TransLink’s Mayors’ Council. “If the province was saying, ‘We’re not willing to talk about other options,’ this would be a no-go. But I see a willingness on their part to say, ‘Let’s put everything on the table.’”
I tend to agree with Corrigan
Burnaby Mayor Derek Corrigan believes that regional mayors are about to get taken for another ride by the province, one where they’ll be left paying all the bills again.
“When will they learn? They keep buying into these promises and then they get taken to the cleaners.”
Interesting to note too that the people who read this blog care a lot about their cell phones, and tramcars of course, but have much less to say about taxes.
Taxpayers get say on $18m transit levy
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.
Translink mulls property tax hike
TransLink’s unelected board will deliberate in secret on whether to raise residential property taxes to help businesses shoulder the burden of an expected tax hit.
At issue is how to raise an extra $18 million each year that TransLink no longer gets since the province eliminated its ability to levy a parking stall tax that the business community fiercely opposed.
Kevin Falcon scrapped the parking stall tax as part of his Translink makeover. The question now is how to replace that revenue – and if it comes from property tax does that apply to all property or just businesses. The new board was of course selected because it represents business. And the business groups get to speak to the new board in private. Everyone else has to wait for the limited opeings of that the Board allows for public submissions.
The battle over property tax for transit is a long running saga here – and across BC for that matter. Property tax is the only one that municipalities can access. The province does not decide how high that can be – local voters do – but it mostly makes its contributions to transit conditional upon local contributions. (One long running sidelight argument is about the gas tax: if it is only raised locally but by the provincial government, does that make it a local or a provincial contribution?)
Mayors do not like hitting voters with property tax increases. For a long time that meant they went after businesses since they do not have votes as businesses, though of course business can and does turn out the vote and pays for electioneering. There is also a limit on how high you can jack up property tax before businesses start to relocate. And most councils are controlled by business friendly parties and non-parties.
Of course the first question to be asked is why Translink “needs” this money since it has a substantial cash cushion at present. Secondly, it has to be noted that Kevin Falcon has also tied raising the gas tax to raising property tax. And he is also refusing to look at changing the provincial policy on tolls to permits road user charges on existing roads.
Any plan by TransLink’s board to increase taxes will still require the approval of the Mayors Council on Regional Transportation.
But is that real or merely a set of words on some legislation? It seems to me that the province has the upper hand, since it can simply put off any of the much needed and desired transit expansions in its so called “plan” by saying, ‘only if you raise property tax’.
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