A recent study suggests that less congestion may increase incomes in Metro Vancouver by up to $1.2 billion.
An independent study from C.D. Howe Institute, titled “Tackling Traffic: The Economic Cost of Congestion in Metro Vancouver” underlines the need for increased investment in transit and transportation infrastructure in Metro Vancouver.
The study highlighted the wider economic cost of congestion in the city, an issue that could be cut by 33 to 40 per cent if residents vote “yes” in this spring’s transit referendum.
While the Mayors’ Council currently estimates congestion costs to be at $500 million per year due to vehicle crashes and wasted time in traffic, the C.D. Howe report, authored by Benjamin Dachis, argues there are wider, unseen costs of congestion that cost residents much more.
These costs include a smaller labour market, causing many to miss out on higher paying jobs, and lost economic productivity due to people making fewer trips to restaurants, shops and events around the region.
If no steps are taken to reduce congestion levels in Metro Vancouver, the $500 million currently lost each year will rise to $1 billion per year by 2045.
Dachis argues that if the transit referendum is passed, not only will costs of congestion go down by 33 to 40 per cent, but residents of Metro Vancouver will make a collective $500 to $1.2 billion a year in extra income. Due to increased mobility and more efficient use of time, annual salaries could rise by $950 per worker per year.
The increased salaries would also have a positive effect on the region’s ability to pay for congestion-cutting measures, including public transit and transportation infrastructure. Both provincial and federal income tax revenues could increase by $150 million and $360 million respectively.
The Mayors’ Council Investment Plan is asking for a 0.5 per cent increase in Provincial Sales Tax (PST) in the region to help pay for Metro Vancouver’s share of the plan. Over all, the tax increase would cost each household $125 extra per year and provide $250 million per year out of the proposed $750 million annual transit plan.