$479 million in new provincial funding for TransLink to avoid service cuts

Mar 15 2023, 9:15 pm

Premier David Eby announced today the Government of British Columbia will provide TransLink with another major infusion in operating subsidies to cover revenue shortfalls.

Metro Vancouver’s public transit authority will receive $479 million from the provincial government to cover forecasted revenue shortfalls and cost inflation through 2025 and help advance new and improved bus services.

This follows TransLink’s Mayors’ Council’s warning a month ago that major service cuts later in 2023 through 2025 would be likely if it does not receive additional pandemic-related operating subsidies from senior governments. Job layoffs and major fare increases beyond 2024 have now also been averted.

“It will allow us to maintain current service levels, and it means we can continue our operations as planned until the end of 2025,” said TransLink CEO Kevin Quinn during the press conference.

“This comes at a time when other transit agencies across the country are forced to make massive service cuts. Such devastating cuts can quickly lead to that transit death spiral with underinvestment with less service, which comes with lower ridership and even lower revenue.”

The provincial government’s latest contribution of $479 million comes from its multi-billion budget surplus for the 2022/2023 fiscal year, which ends this month.

This brings TransLink’s total pandemic-time financial relief from senior governments to $1.3 billion, including $644 million in initial joint provincial and federal subsidies in September 2020 for forecasted revenue shortfalls in 2020 and 2021, and $176 million in joint funding from senior governments in January 2022 for revenue shortfalls in 2022 and 2023.

However, the latest infusion will not only be used as a temporary financial bridge for TransLink operations, but also enable improvements to bus services, including the expansion of the battery-electric bus fleet to 155 vehicles by 2025, increase service on the busiest bus routes, and launch more RapidBus routes.

“While we expect these challenges to be short term, we have to act now to stabilize TransLink’s finances. If we failed to act to support transit in the region in this way, we would see higher fares, reduces services, and it would put important infrastructure projects at risk,” said Eby.

It was noted by BC Transportation Minister Rob Fleming that the provincial government will continue discussions with the federal government on a potential funding partnership. The Mayors’ Council’s original request last month was to have the provincial and federal governments each provide $250 million for a total of $500 million in senior government funding.

But due to TransLink’s significant and immediate needs, and the limited timeline to spend the provincial budget surplus from the outgoing fiscal year, the provincial government decided to take the first step.

“We’ve brought it to the attention of the federal government,” said Eby, referring to the provincial government’s efforts to lobby the federal government for more public transit funding. “I’m disappointed, frankly, that they’re not here with us today.”

It is noted that TransLink’s operating revenues are expected to improve over the long term.

While TransLink’s ridership recovery to date is amongst the highest in North America, reaching over 80% of pre-pandemic 2019 levels as of December 2022, the continued gap in ridership is having an impact on finances. The ridership regrowth throughout 2023 and 2024 is expected to be slower than the significant increases seen in 2021 and 2022.

TransLink’s service levels are currently hovering at 94% of pre-pandemic 2019 levels, but fare revenues have rebound to just over 70% of pre-pandemic levels. While ridership recovery is strong, passengers are also using less expensive fare products leading to lower fare revenues.

“This significant funding package allows TransLink to move forward and delivery high-frequency, reliable services for the people of our region,” said Brad West, the chair of the Mayors’ Council and the mayor of Port Coquitlam.

“This is an investment that is not just important but necessary given our regional trajectory. If you haven’t noticed, we are growing by leaps and bounds. More than 50,000 people are estimated to move into Metro Vancouver annually, equivalent to adding the city of North Vancouver each year.”

The Mayors’ Council also asked for new long-term permanent stable funding for public transit services so that there is less dependency on demand-driven revenues, including the gas tax, which is seeing a downward revenue trajectory due to more efficient vehicles and the transition to battery-electric vehicles.

Kenneth ChanKenneth Chan

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