Public transit should reconsider its fare revenue dependence, says TransLink CEO
Over the past few weeks, TransLink ridership has been hovering at about 43% of normal levels — up significantly since the pandemic low of just 17% in April.
The pace of the ridership rebound appears to have slowed down recently, which contrasts to vehicle volumes returning to near normal levels, with the public transit authority’s recent counts of major regional bridges showing up to 93% of pre-COVID volumes by late summer.
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During Monday’s board of directors public meeting, TransLink CEO Kevin Desmond illustrated how ridership recovery has been uneven across the subregions.
The recovery rate is 44% for the North Shore, 39% for Vancouver and UBC, 37% for Burnaby and New Westminster, 42% for Richmond and Delta, 51% for Surrey and Langley, 37% for Coquitlam, Port Coquitlam, and Port Moody, and 55% for Maple Ridge and Pitt Meadows.
Within Vancouver and Burnaby, for instance, ridership remains weaker as universities have taken most of their courses online. For example, the R5 Hastings RapidBus between Burrard Station and SFU Burnaby is now operating at about 30% of weekday ridership. On Route 145 Production Way-University Station/SFU Burnaby, weekday ridership is just 10% of normal levels.
Ridership on select south-of-Fraser routes experienced a more robust recovery, with Route 104 22nd Street Station/Annacis Island at 60%, Route 319 Scott Station/Newton Exchange/Scottsdale at 50%, and Route 310 Scottsdale/Ladner Exchange at 64% on weekdays and up to 90% on weekends.
On the modes of service, buses are now at 43% of normal levels, while the Expo and Millennium lines are at 38%, Canada Line is at 31%, SeaBus is at 27%, and West Coast Express is at 17%.
A TransLink staff report for the meeting states ridership is down due to reasons that include physical distancing guidance, proximity anxiety, increase in work-from-home, higher unemployment, and less overall travel and activity.
Current forecasts by TransLink show ridership across the region could rebound to 70% of normal volumes by early 2021. That is roughly equivalent to the 316 million boardings recorded in 2009, whereas 451 million boardings were experienced in 2019.
Ridership will eventually fully rebound, given that Metro Vancouver’s population and job growth will resume, and there is a constrained geographical area in the region to accommodate this growth. Moreover, land use very strongly supports transit-oriented development.
But the current predicament shows how TransLink’s dependence on the transportation-demand based revenues of fares, and to a lesser extent fuel and parking taxes, has become a pitfall.
Desmond told the Union of BC Municipalities convention last week the public transit authority is now tracking a revenue shortfall of $600 million to $1 billion through next year, depending on COVID-19’s trajectory and the pace of the ridership rebound.
“The big impact on our revenue was because we have a very high reliance on our fare box at TransLink. At the end of last year, about 58% of our operating expenses were covered by fare box, one of the highest in all of North America,” said Desmond, noting that TransLink is in danger of experiencing a structural deficit this decade.
“It’s something we have to reconsider in terms of that very high reliance on fare box going forward.”
This suggests not only diversifying TransLink’s revenue but also creating more predictable sources, including further subsidies.
A recent report commissioned by TransLink outlined how a real estate arm could become both a new ancillary revenue source and a ridership generator by creating high-density, transit-oriented developments.
In a 50-50 agreement, the provincial and federal governments have allocated a combined $644 million to TransLink to cover revenue losses incurred since March and the forecasted losses within the remainder of the current fiscal year. This subsidy provides TransLink with the ability to maintain services at near normal levels. Another $86 million and $308 million was respectively provided to BC Transit and BC Ferries.
“COVID-19 has really highlighted how vulnerable and unresilient our funding model is for public transit. This used to be a source of pride as it acknowledged we were seeing a surge in ridership, but I think we’ve realized how vulnerable our transit is,” said Jonathan Cote, mayor of New Westminster and the chair of TransLink’s Mayors’ Council, adding that the fiscal crisis opens a much broader conversation on how to properly fund public transit.
Over at BC Transit, ridership dipped to just 20% of normal levels during the pandemic low in April. It has since returned to about 50% of pre-COVID levels.
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