Falcon could support TransLink vehicle levy
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Transportation minister Kevin Falcon won't impose region-wide road or bridge tolling to finance TransLink's expansion but says he may support a vehicle levy.
Those options top TransLink's wish list of new revenue sources, in addition to expected increases to fuel and property taxes, fares and new profits from real estate development.
A TransLink report obtained by Black Press estimates an annual vehicle fee that averaged $100 per vehicle would raise $140 million per year.
It suggests the levy could be sweetened by giving those who pay it a universal transit pass that would act as "a value proposition."
Falcon said that concept makes sense because it offers a payback to motorists who must pay the fee and could encourage more people to try transit.
"Drivers would be given an opportunity to utilize the dramatically improved transit system," he said in an interview.
"You have to give people something more than just saying we're going to ding you dollars for our transportation system, thank you very much."
Falcon predicted the offer of a free annual transit pass would help win public acceptance and said he would be "open to supporting" a levy on that basis.
TransLink plans to launch public consultations in the months ahead on a number of potential ways to generate an extra $300 to $500 million per year to carry out aggressive transit upgrades, on which the province's climate change goals depend.
The authority has been chronically underfunded in part because a past TransLink attempt to collect a $75 vehicle levy in 2000 enraged the public and was quashed by the then-NDP government.
Falcon predicts things will be different this time.
He said the old vehicle levy was "just a cash grab to fund an organization that I don't think had a clear and compelling vision of what they were going to deliver in terms of benefits."
The new-and-improved TransLink, he said, has a professional board, is well run and has a clear vision that includes three major new SkyTrain lines or extensions and a doubling of the current bus fleet to vastly improve service.
The annual vehicle fee might be a flat $100 or it could vary based on how far people drive each year or the fuel efficiency of their vehicle, the TransLink report suggests.
It also says road user fees in the form of electronic tolls could pull in significant revenue, influence transportation behaviour and "reduce congestion to free up road space for high priority users."
But Falcon rules out that measure for the foreseeable future.
"That's not going to be on the table," he said. "We are not going to have regional or congestion tolling or whatever you want to call it until such time as there is a first-rate public transit system in place."
TransLink is also eyeing the Property Transfer Tax, which hands Victoria a slice of money off real estate transactions in the province.
The real estate tax has ballooned to the point it rakes in $1 billion a year (although that is expected to slide along with the real estate slowdown) – $375 million of that from within Metro Vancouver.
Falcon said TransLink would have to pursue accessing those funds with finance minister Colin Hansen, who he predicted would "take a dim view" of the idea.
Another potential source, TransLink documents show, is a charge levied on all new developments, which could vary depending on the type or location of the development.
Falcon said TransLink can now make money through its own real estate development – TransLink estimates that may be worth $30 million a year – and has been given the ability to raise the local gas tax another three cents a litre.
Beyond that, he said, the region and its taxpayers will have to pay their share and not bank on a bailout from Victoria.
"The region is obviously going to have to do their part," he said. "You don't get something for nothing."
Any tax hikes or new revenue streams need approval from the Mayors' Council on Regional Transportation and Falcon said those mayors will have to decide whether the improvements TransLink plans are worth the money.
"Ultimately the mayors will decide how ambitious they want to be and what kind of transit service they want to have," he said.
Some mayors have called TransLink insolvent, arguing more money from provincial or federal sources is needed.
Even if the expansion plans were shelved, TransLink faces a $150 million a year deficit after 2011 to just maintain the system.
Many mayors also say they have been set up by Falcon as a scapegoat for unpopular new fees if they're approved or anything else that goes wrong.
Falcon said the region will benefit tremendously from the province's new $14-billion Provincial Transit Plan.
"Leadership means being honest with the public and saying there's a cost associated with it," he said. "If they don't support it they need to say to the public, 'I don't support it and I don't want to have the population pay for those increased services.' And that's a legitimate position to take. But they'll have to defend it. I will be a strong advocate saying we need to do this."
Transit ridership has gone up this year as more residents try to minimize driving and try transit, but the system is often packed at peak hours because more buses and SkyTrain cars aren't being added fast enough.
Related
- Victoria sought to delay TransLink fees debate
- TransLink eyes new fees to fund expansion
- TransLink's new CEO lays out strengths, challenges
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