B.C. government to provide $312 million to TransLink, create new revenue sources | Daily Hive

B.C. government to provide $312 million to TransLink and enact legislation for new revenue sources

December 20, 2024, opening day of SkyTrain Canada Line's Capstan Station. (Kenneth Chan/Daily Hive)

The Government of British Columbia announced today that it will set aside additional operating subsidies for TransLink, not only to completely avoid the drastic cuts to Metro Vancouver’s public transit services starting in 2026 but also to enhance services.

The provincial government will provide TransLink with $312 million in operating funding over three years from 2025 to 2027 — about $100 million per year. This is intended to be a one-time grant.

But TransLink is not depending entirely on operating subsidies from the provincial government to make up for its revenue shortfall. Simultaneously today, TransLink announced its proposal to enact higher increases to property taxes, parking taxes, and fares, including the first-ever increase to the YVR AddFare on SkyTrain’s Canada Line for trips originating from Vancouver International Airport. These tax and fare increases will head to TransLink’s board of directors and Mayors’ Council in late April 2025 for final approval.

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“We know TransLink was facing a significant deficit as costs and demand for service increased, and had warned of drastic cuts to services,” said Mike Farnworth, B.C. Minister of Transportation and Transit in a statement.

“Our government is committed to protecting services for the people of B.C. In partnership with TransLink and the Mayors’ Council we are making sure that people continue to have safe, reliable and affordable transit services while expanding priority projects.”

Since the pandemic, prior to today, the provincial and federal governments have provided TransLink with a combined total of $1.3 billion in operating subsidies, including $644 million in initial joint provincial and federal subsidies in September 2020 for forecasted revenue shortfalls in 2020 and 2021, $176 million in joint funding from senior governments in January 2022 for revenue shortfalls in 2022 and 2023, and $479 million in subsidies from the provincial government in 2023 to cover revenue shortfalls through the end of 2025.

This latest $312-million funding infusion from the provincial government to cover a portion of the operating costs over the next three years is intended to be a transitional source of funding until new provincial legislation is approved to provide TransLink with new additional funding sources.

So far, the public transit authority and provincial government have not specified what the new funding sources — requiring legislation — will be. However, TransLink has indicated that the new sources are expected to generate at least $112 million annually once fully implemented in 2028 — after the $312 million subsidy is depleted.

According to TransLink’s proposed 2025 Investment Plan released today, “If passed, the new source(s) is intended to begin in 2027 with full implementation in 2028 generating at least $112 million per year in new revenue when fully implemented. The new source(s), when combined with the utilization of other existing revenue sources, is also intended to help TransLink fix the remaining deficit and make further progress on the Access for Everyone Plan. TransLink and the Province will work together to develop the parameters and options for the new revenue source(s) to be introduced in 2027.”

This is in addition to the provincial government’s forthcoming move to amend legislation enabling TransLink to increase its parking tax from 24 per cent to 29 per cent.

The last time legislation was amended to provide TransLink with a new additional revenue source was in 2018, when the development cost charge on new building developments across Metro Vancouver was approved.

In the early 2000s, during the organizational infancy of TransLink, shortly after Metro Vancouver’s public transit network spit off from BC Transit’s umbrella, a plan to enact an annual vehicle levy — akin to an annual registration fee for each vehicle — was rejected after major public pushback. As well, in 2017 and 2018, TransLink extensively studied and performed public consultations on mobility pricing, which requires provincial approval through new legislation if it is to be seriously pursued.

TransLink and its Mayors’ Council have been urging the provincial government to create new, predictable, stable revenue sources that are less reliant on fares and the dwindling gas tax revenues, which are now in a downward trend due to the growing adoption of battery-electric vehicles. A wide range of factors previously led TransLink to project a revenue shortfall of $600 million annually starting in 2026.

“This investment plan proposal will not only fully fund TransLink services for two years, but will expand transit with the largest increase to bus service since 2018,” said Brad West, chair of TransLink’s Mayors’ Council and the Mayor of Port Coquitlam.

“Now, more than ever, is the right time to invest in British Columbia’s future, and these investments are crucial to the region’s growth and economic strength.”

Over the interim, using the various fare and tax hikes by TransLink — if approved — and the interim operating funding from the provincial government, the public transit authority plans to provide the largest increase in bus services since 2018, increase HandyDART and West Coast Express capacity, and begin design work on three new Bus Rapid Transit lines.

It should be emphasized that this plan primarily covers operating costs, not the major multi-billion dollar capital costs of building new and improved infrastructure, such as the SFU Burnaby Mountain gondola, additional SkyTrain extensions, new bus depots, and new bus orders.

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