$370 million public transit funding coming to Metro Vancouver in federal budget

Prime Minister Justin Trudeau’s first budget has pegged $11.9 billion in infrastructure investments over the next five years, split between public transit, housing, and green projects. It represents just a fraction of what the Liberals intend to spend over the next decade.

British Columbia will receive $460.5 million for public transit, which is 13.63% of the $3.38 billion allocated for the national Public Transit Infrastructure Fund. This includes $370 million for public transit projects in the Metro Vancouver region, an amount that has been termed as the federal government’s “initial” commitment.

But it is a drop in the bucket to cover the costs of Metro Vancouver’s multi-billion dollar transit projects.

Surrey wants to build a $2.6-billion, 27-kilometre-long light rail transit network while Vancouver wants a $1.9-billion, six-kilometre-long underground extension of SkyTrain’s Millennium Line beneath Broadway from VCC-Clark Station to Arbutus Street.

The remaining bulk of the funding needed for these two major projects will come from the second phase of infrastructure investments beginning in 2021, after the next federal election. This means construction on these projects will not likely begin for about another five years, but today’s budget at the very least provides funding to accelerate planning work.

“The budget’s commitment to provide federal funding to accelerate design and engineering work on major projects like the Broadway Subway and light-rail transit in Surrey is good news for the tens of thousands of people using transit in our region, and who desperately need expanded, more efficient service,” said Vancouver Mayor Gregor Robertson in a statement, on behalf TransLink’s Mayors’ Council.

The federal government says it will cover up to 50% of transit project construction costs, effectively replacing the existing one-third model used by previous governments.

“The new funding and flexibility dedicated to transit will help us get moving on improving transit in Vancouver and throughout the region, and will both grow our economy while protecting our environment,” Robertson continued. “The changes the federal government has made to transit funding reflect the needs of cities across Canada and is good news for transit riders.”

At this time, it is unclear whether Premier Christy Clark’s provincial government will be willing to increase its commitment levels beyond the 33% based on the traditional one-third funding model between levels of federal, provincial, and municipal governments.

However, a higher level of federal commitment could significantly lower the required municipal level commitment from TransLink. Last year’s failed transit plebiscite in Metro Vancouver would have raised $2.5 billion over 10 years through a regional half per cent tax, covering one-third of the Mayors’ Council ambitious $7.5 billion transportation plan.

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Today’s federal budget also consists of $8.4 billion over five years for indigenous programs, including education, clean water treatment, housing, and social infrastructure.

There will be $3.4 billion to help maintain and improve national parks, federal airports, border infrastructure, harbours, and clean-up costs of contaminated federal sites. Stimulating green initiatives, a priority for this government, include $2 billion for a low carbon economy fund, $62.5 million for electric car subsidies, and $135 million for clean energy research.

The stimulus spending is expected to boost the national GDP by 0.5% in 2016 and 1% in 2017.

The spending commitments will push this year’s federal budget deficit to $29.4 billion, three times what was promised during the fall election campaign when Trudeau promised to invest $60 billion into infrastructure projects across the country over 10 years, including $20 billion towards public transit projects. This first slate of spending promises is expected to boost the national GDP by 0.5% in 2016 and 1% in 2017.

Altogether, over the next 10 years, Trudeau plans on spending $120 billion on infrastructure.