Urban Transportation in Canada
Urban Transportation in Canada
Fatima Abdulrasul
Ontario Ministry of Transportation
Sherry Appleby
Newfoundland and Labrador Department of Transportation and Works
Miranda Carlberg
Saskatchewan Highways and Transportation
Amar Chadha
Manitoba Transportation and Government Services
Roberta Coleman
Manitoba Transportation and Government Services
Évangéline Lévesque
Ministère des Transports du Québec
David McKay
Alberta Infrastructure and Transportation
Robert Patry
Ministère des Transports du Québec
Jacques Rochon
Transport Canada
Kirk Rockerbie
British Columbia Ministry of Transportation
Amelia Shaw
Transport Canada
Alan Stillar
Ontario Ministry of Transportation
Bernie Swan
Nova Scotia Transportation and Public Works
Greg Tokarz
Ontario Ministry of Transportation
Alec Waters
Alberta Infrastructure and Transportation
Foreword
In September 2003, the Council of Deputy Ministers Responsible for Transportation and
Highway Safety established an Urban Transportation Task Force comprised of representatives
from provincial and territorial jurisdictions and the federal government. The goal of the Task
Force is to explore urban transportation issues of common interest with a view to
recommending actions to the Council, including initiatives, priorities and criteria for urban
transportation investment in the context of potential partnerships between federal, provincial,
territorial governments and municipalities.
Through its regular meetings, the Task Force has been a forum for the sharing of information
and approaches to urban transportation issues. The Task Force supplemented those discussions
with information collected through two surveys on the urban transportation needs and priorities
within the provincial, territorial and federal jurisdictions. The material compiled through those
meetings and surveys provided insightful information that is presented in the report that
follows. In particular, the report highlights the investment needs for public transit and urban
roads over the next ten years. It finds that the needs are significant and shows that investing in
transportation (in addition to other kinds of infrastructure) is critical to supporting economic
and job growth, environmental sustainability, and quality of life in Canada’s cities.
The report makes several recommendations in the context of an anticipated “New Deal” for
cities and communities. The recommendations encourage the federal government to provide
sustainable, predictable, long-term funding to support urban transportation investment. While
respecting provincial and territorial jurisdiction and planning priorities, the recommendations
also call upon all orders of government to recognize the importance of sustainable urban
transportation, to take action and to find ways to work together more effectively to improve
transportation and mobility in urban areas.
The recommendations contained within this report were endorsed by the Council of Ministers
Responsible for Transportation and Highway Safety in September 2004. We hope the report
will be useful to individuals and agencies with an interest in the important role that public
transit and good roads play in the fabric of Canada’s cities.
January 2005
ii
Urban Transportation in Canada:
Needs and Opportunities
Executive Summary
In recent years, the urban agenda has risen steadily as a priority interest for all orders of
government. There is growing recognition of the importance of our cities to our national and
regional economies and to the quality of our individual lives. At the same time, there is a
growing understanding that a gap exists between the need and the ability to provide
infrastructure and deliver services within cities. Combined, these factors have created pressure
on all governments to provide support to address urban issues, close the infrastructure gap and
ensure the viability and prosperity of Canada’s urban centres.
In this context, this document was prepared by the Urban Transportation Task Force of the
Council of Deputy Ministers Responsible for Transportation and Highway Safety to provide an
overview of urban transportation in Canada and offer arguments in favour of investing in urban
transportation infrastructure. The paper presents the results of two Task Force surveys that
highlight urban transportation needs and priorities identified by the provinces and territories.
The paper also aims to provide the provincial/territorial perspective on principles for effective
partnerships among the various orders of government on urban transportation matters.
Canada’s cities are the economic engines of the country and investing in our cities will benefit
all Canadians. Within cities, much of the need is in transportation and much of the investment
should consequently be targeted at transportation infrastructure. Transportation is an enabling
sector – often lost to issues deemed more critical. However, transportation touches Canadians’
lives every day through access to work, education, health care facilities, and accessible goods.
Fundamentally, transportation enables economic wealth and the tax base to pay for what is
important to Canadians. Consider the following:
• A large infrastructure gap has emerged between the current fiscal capacity and the needs
of citizens for core services. (Federation of Canadian Municipalities, 2004)
• The potential long-term costs of failing to address the infrastructure issues are
numerous, and include higher government operating costs, negative impacts on the
environment and threats to public health and safety. (Vander Ploeg, 2003)
• A study by the Canada West Foundation (Vander Ploeg, 2003) found that for most
western cities, the largest portion of the infrastructure deficit resides in transportation –
roads, traffic control, bridges, interchanges, and public transit. It seems likely that this
is the case for most cities across Canada.
• Urban congestion has significant economic costs and affects the competitiveness of
Canada’s economic centres. Congestion means delay – lost time and productivity,
wages foregone and extra fuel costs. Access to airports and ports, freight pick-up and
delivery, just-in-time delivery schedules, and business activities are all compromised by
congestion. It results in greater fuel consumption and additional emissions of air
pollutants and greenhouse gases. Congestion also reduces the effectiveness of our
national transportation system by constraining the movements of goods and passengers
within and through major urban centres. (Transport Canada, 2003)
It is clear from the work of the Task Force and others that the transportation infrastructure need
in urban areas is very large. In fact, the need is estimated to be in excess of $85 billion over the
next ten years. It should be emphasized that governments have invested and will continue to
invest in urban areas and some of the $85 billion need will be met by current and planned
expenditures. However, the need exceeds the funding capacity of the traditional partners – the
users, the municipalities and provincial governments. Additional new investment is critical to
support cities and communities in pursuit of economic, social and environmental goals.
The federal government has committed to provide new funding through its “New Deal” for
cities and communities, funded in part by sharing federal gas taxes. It is an important principle
from the federal perspective that provincial/territorial governments not reduce their funding to
municipalities as a consequence of that federal investment. It is recognized that funding
decisions for the “New Deal” will be the product of an intergovernmental negotiation that
involves many ministries and departments at both the provincial and federal levels. The
emphasis, regardless of mechanism, must be on securing reliable, long-term, net new revenue
sources adequate to meet the growing needs in urban areas. That funding must be:
• Equitable, flexible and balanced. Funding should account for local needs and priorities
and new funding should not be at the expense of investment in rural areas.
2
In addition to new investment, there is an array of other measures that governments have at
their disposal which could support and promote urban transportation. There is great potential
for collaboration amongst orders of government on such approaches, which should be explored
in more detail.
The challenges faced by urban areas will require not only new funding but also a new
partnership amongst orders of governments. Principles that could underlie an effective
partnership unanimously supported by provincial respondents to a Task Force survey include:
• Federal programs should respect provincial and territorial jurisdiction and planning
priorities.
• Federal funding programs should not be contingent upon matching funding from
provinces and territories.
• There should be flexibility in program designs to accommodate programs that meet the
needs of the jurisdictions.
Five recommendations emerge from the needs, priorities and principles discussed herein. They
are:
3. Governments must take action to improve transportation and travel time for
freight and passengers in urban areas through increased investment,
transportation demand management, improved planning processes and the use of
advanced technology.
4. While respecting provincial and territorial jurisdiction and planning priorities, all
orders of government must find ways to work together more effectively to improve
transportation and mobility in urban areas. Opportunities for collaboration
beyond funding partnerships should be explored.
3
Introduction
In recent years, the urban agenda has risen steadily as a priority interest for all orders of
government. There is growing recognition of the importance of our cities to our national and
regional economies and to the quality of our individual lives. At the same time, there is a
growing understanding that a gap exists between the need and the ability to provide
infrastructure and deliver services within cities. Combined, these factors have created pressure
on all governments to provide support to address urban issues, close the infrastructure gap and
ensure the viability and prosperity of Canada’s urban centres.
The paper provides an overview of urban transportation in Canada and offers arguments in
favour of investing in urban transportation infrastructure. The results of the Task Force surveys
are presented, highlighting urban transportation needs and priorities identified by the provinces
and territories and offering insights to areas of commonality amongst those jurisdictions. The
paper also aims to provide the provincial/territorial perspective on principles for effective
partnerships among the various orders of government on urban transportation matters. Finally,
in the context of an anticipated “New Deal” for cities and communities, the Task Force
developed recommendations which were offered for consideration by the Councils of Ministers
and Deputy Ministers Responsible for Transportation and Highway Safety. The
recommendations were approved in September 2004 and are presented herein.
Canada has become one of the most urbanized countries in the world, with the majority of its
population located in urban areas. The population is also becoming increasingly metropolitan,
with much of the population, employment and economic activity located in the very largest
cities. Canadians are highly mobile, with 13 million traveling to and from work each day,
making six trillion trips each year and as many trips again for recreational purposes (Parsons,
2003). In this dense and busy urban landscape, several dominant trends impact transportation.
Urbanization: Over 80% of Canadians live in urban centres and 67% of our total employment
is located in 25 census metropolitan areas. Furthermore, half of the urban dwellers, or 40% of
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the Canadian population, live in one of the six biggest urban areas (Toronto, Montréal,
Vancouver, Ottawa-Gatineau, Calgary and Edmonton) where nearly 50% of the total
employment is located. This concentration of population and economic activity creates strong
pressure on urban transportation networks and systems.
Urban sprawl: Lower density land use and the sprawl of residential zones and places of
employment fosters increased automobile use, complicates management of public transit
services, accentuates infrastructure needs and limits the potential of certain alternative modes,
such as walking and cycling. Sustainable land-use planning and development approaches could
limit sprawl and its effect on urban areas.
Aging population: The aging of the population has a significant impact on public transit
ridership and accessibility needs. In the past, the aging of the population has led to decreased
transit use. In the future, baby-boomer aging could increase transit use as they pass retirement
age.
Climatic changes and environmental issues: Greenhouse gas (GHG) emissions are generally
concentrated in urban environments and transport activities are a major source of atmospheric
pollution. The achievement of Canada’s objectives for greenhouse gas reduction will require a
significant reduction in GHG emitted in urban centres.
In a landscape characterized by the above trends, the challenges faced by municipalities are
many. While the nature and extent of the challenges may vary with the size of the population
served, jurisdictions nonetheless commonly report economic, environmental and social issues
as follows:
Aging infrastructure and equipment: Much of Canada’s road infrastructure was built in the
1950s and 60s and was generally well maintained through the 1970s. Beyond the 1970s, for a
variety of reasons, a backlog began to grow in maintenance and replacement work for civil
infrastructure systems including roads and bridges. The result is a physical infrastructure
system that has aged and is now approaching the end of its useful service life. On the public
transit side, the vehicle fleet in Canada averages 11 years old, compared to the Canadian Urban
Transit Association’s (CUTA) recommended average fleet age of 6 to 9 years. At the extreme,
in some cases buses are pressed into service at 25 years of age and subway cars in Montréal and
Toronto have been in service since the 60s. The delivery of transit services in a reliable,
efficient and effective manner, which is necessary to ensure they are a viable alternative to the
automobile, is greatly challenged by the age of the system.
Congestion: Large urban centres experience major congestion and gridlock, causing delay,
increased energy consumption and air pollution. The economic and environmental
consequences of congestion are high, estimated at several hundred million dollars to $2 billion
5
annually in some urban centres. Furthermore, the modern economy relies on its workforce and
on “just-in-time” production. Urban congestion has a substantial negative impact on the
competitiveness of Canadian urban centres and Canada as a whole.
Decline in the modal share of public transit and non-motorized modes: While public transit
ridership has increased in the past few years, the market share of total trips represented by
public transit, as well as walking, continues to diminish. Urban sprawl, policies favourable to
use of the automobile and population aging are all trends which exacerbate this challenge for
urban areas.
Decreasing population in smaller urban centres: Declining populations affect ridership and
revenue of public transit systems. The limited pool of riders and, more generally, the low land
use density in smaller urban areas, significantly increases the operating costs of public transit
services, given the distances to travel and the lower volume of passengers transported.
Canada’s cities are the economic engines of the country and investing in our cities will benefit
all Canadians. Within cities, much of the need is in transportation and much of the investment
should consequently be targeted at transportation infrastructure. Transportation is an enabling
sector – often lost to issues deemed more critical. However, transportation touches Canadians’
lives every day through access to work, education, health care facilities, and accessible goods.
Fundamentally, transportation enables economic wealth and the tax base to pay for what is
important to Canadians. (Western Transportation Advisory Council, 2002) Consider the
following:
• More than 80% of foreign multinational executives surveyed indicated that the poor
state of business infrastructure adversely affected Canada as a destination for foreign
direct investment. One of the key concerns is the state of the country’s physical
infrastructure (The Canadian Council for Public-Private Partnerships, 1998).
• A large infrastructure gap has emerged between the current fiscal capacity and the needs
of citizens for core services. (Federation of Canadian Municipalities, 2004)
6
• The potential long-term costs of failing to address the infrastructure issues are
numerous, and include higher government operating costs, negative impacts on the
environment and threats to public health and safety. (Vander Ploeg, 2003)
• Deferring maintenance of aging infrastructure will mean higher costs down the road
when infrastructure will need to be replaced because inadequate maintenance has ended
useful service life more quickly than necessary. The Law of Fives suggests that the cost
of an infrequent maintenance activity is five times the cost of good practice. Moreover,
if delays in maintenance are too long, then repairs are required, costing yet five times
more. If repairs are also neglected, then the infrastructure will require renovation
(replacement) at a cost of 125 times good maintenance practice. (Kennedy and Adams,
2004)
• A study by the Canada West Foundation (Vander Ploeg, 2003) found that for most
western cities, the largest portion of the infrastructure deficit resides in transportation –
roads, traffic control, bridges, interchanges, and public transit. It seems likely this could
be the case for most cities across Canada.
• The economic artery that is Canada’s transportation system is a key reason that
Canadians enjoy the quality of life they do. However, a large and growing number of
barriers threaten the continued health of the transportation system. Deferring decisions
on investment and other regulatory changes required to maintain productivity
improvement incurs costs that are growing and threaten the foundation of our economy
and society. (Parsons, 2003)
• The movement of Canadians into large cities is creating special challenges for
transportation industries. Metropolitan areas have become the origins and destinations
for most freight movements and transshipment points. The concentration of people into
cities has brought with it major development issues for those providing the
transportation system. (Parsons, 2003)
• Urban congestion has significant economic costs and affects the competitiveness of
Canada’s economic centres. Congestion means delay – lost time and productivity,
wages foregone and extra fuel costs. Access to airports and ports, freight pick-up and
delivery, just-in-time delivery schedules, and business activities are all compromised by
congestion. It results in greater fuel consumption and additional emissions of air
pollutants and greenhouse gases. Congestion also reduces the effectiveness of our
national transportation system by constraining the movements of goods and passengers
within and through major urban centres (Transport Canada, 2003)
7
more transportation fatalities per year, increasing health costs by more than $1.1 billion
annually. (Canadian Urban Transit Association, 2003)
Understanding the importance of urban transportation to the viability of urban centres, the
prosperity of our economy and our environmental and social well-being, communities across
Canada are working to deliver the best transportation system possible, in often highly
constrained circumstances. Common visions for urban transportation expressed in a 2003
survey of the Task Force include:
• Providing safe, efficient, effective transportation systems, for goods and people, in an
integrated and multi-modal network.
• Promoting mobility and reasonable access to transportation for all Canadians.
• Improving transportation and trade corridors.
• Improving transit services.
Through the work of the Urban Transportation Task Force, and particularly the survey it
conducted in 2003, provincial and territorial jurisdictions have identified other thematic
priorities for urban transportation as depicted in Figure 1. Notably, seven of eight respondents
to the survey identified transit, goods movement, modal integration and funding, governance
and decision-making as high priorities for urban areas. These are described below.
0 1 2 3 4 5 6 7 8
8
efficient, effective, reliable) transit services will increase its attractiveness relative to the private
automobile, thereby reducing automobile use and reducing gridlock and traffic congestion.
This should improve the efficiency of goods movement in support of trade and the economy,
reduce air pollution and environmental impacts and improve the quality of life and the social
well being of Canadians living in urban areas. Public transit also serves a social mission: for
people who do not have a car, it is often the only means of access to employment, health care,
schools and other important activities.
National and international trade is vital to the economy and more efficient transportation
resulting in more efficient goods movement means more competitiveness. Within cities, goods
movement must compete with commuters, recreational and tourist travelers for space on the
transportation system. To and from cities, adequate provincial highway and arterial capacity
and effective and efficient links to national trade corridors are also necessary. Concerns about
trade congestion in those corridors were cited in the Task Force survey. The daily value of
two-way trade between Canada and the US is $1.5 billion. The costs of transportation
inefficiency for goods movement in, to and from urban centres can be enormous with
significant impacts on the Canadian economy.
Modal integration is considered key to the efficient movement of goods and people. More
often than not, transportation requires the use of more than one mode and provincial
respondents to the Task Force survey noted that a coordinated approach to interface and
integrate different modes is a high priority.
Addressing funding, governance and decision-making for urban transportation is a high priority
for provincial respondents to the Task Force survey. The financial needs to maintain the
existing equipment and infrastructure and to improve the quality of public transit services are
enormous. Establishing effective, long-term, stable funding solutions, which will allow better
planning, is key. Furthermore, in many jurisdictions, the fragmentation of transportation
funding and decision-making responsibilities among several authorities and among different
forms of transportation makes it difficult to implement an integrated urban strategy throughout
the urban centre. A new partnership amongst all levels of government, one that is built upon
consultation and collaboration and that respects jurisdictions’ responsibilities, is necessary in
establishing future governance models.
Other transportation issues of varying degrees of priority that were cited in the Task Force
survey included urban structure and land use, special user needs, the environment, the
automobile, new and emerging technologies, walking, cycling, parking and system
optimization.
The need for investment in infrastructure in Canada, and particularly in Canadian cities, is
widely accepted to be significant, critical and growing. To estimate the extent of the
investment that would be required over the next ten years, the Task Force conducted a survey
9
of provincial and territorial jurisdictions on urban transportation needs. Submissions were
received from ten jurisdictions; key results are summarized below.
Reporting on transit systems in 160 cities across Canada, the survey indicates an investment of
nearly $23 billion will be required over the next ten years. This total includes investments
necessary for system maintenance and renewal as well as system expansion for conventional
transit infrastructure, fleet vehicles and technology. It does not include costs that would be
incurred by municipalities establishing new transit systems where none currently exist or for
specialized transit. Furthermore, the total does not include transit needs in Saskatchewan,
Prince Edward Island, the Northwest Territories or Nunavut as those jurisdictions did not
provide an estimate for the Task Force survey. A breakdown of the $23 billion total is
provided in Table 1 and is depicted graphically in Figure 2.
Respondents to the Task Force survey also attempted to identify investment needs for roads and
bridges in their municipalities. Although all respondents offered submissions on this
component, most did so with caution, noting the greater difficulty experienced in acquiring the
data from municipal sources. Furthermore, there was considerable variability in the approaches
to estimating the investment needs in each jurisdiction, particularly with regard to what
constitutes an urban centre. Those issues were left to the discretion of the responding agencies
and the submitted data points to a needed investment in roads and bridges (whether municipally
or provincially owned) in excess of $66 billion in the next ten years. A breakdown of this total
is provided in Table 2 and Figure 2.
70,000 YT
60,000 SK
QC
50,000
ON
$ Millions
40,000 NL
30,000 NS
NB
20,000
MB
10,000 BC
0 AB
Transit Roads and Highways
10
Table 1: Transit Investment Needs* (2004 – 2013) Identified in Task Force Survey
11
Table 2: Road and Highway Investment Needs* (2004 – 2013) Identified in Task Force Survey
12
The tables reveal considerable differences in the scale of the investment needed in different
jurisdictions. It is apparent that in the jurisdictions with the largest cities the investment
required is much larger than in jurisdictions with smaller cities. For example, in Ontario,
investment required in just the next four years to maintain, renew and expand transit
infrastructure, rolling stock and technology will exceed $10 billion. In New Brunswick,
investment needed in transit is estimated to be nearly $39 million over the next ten years.
There, the primary investment needs are replacement of buses and maintenance of transit
infrastructure such as garages and bus stop locations with some additional funding required for
advanced technology traveler information systems. While there is an order of magnitude
difference in dollar value, in proportion to the current resources of the jurisdictions, the needs
are similarly significant. Furthermore, the impact of the investment is expected to be important
from an economic support and development perspective, regardless of the size of the need or
the jurisdiction.
The values included in Tables 1 and 2 are investment needs forecast for the next ten years; it
should be emphasized that the tables do not identify planned expenditures. Governments have
invested and will continue to invest in urban areas and some of the identified need will be met
by current and expected budgets. However, there is an expected shortfall or deficit in
infrastructure funding as the need exceeds current funding capacity. Various sources have
attempted to quantify the extent of the deficit, and despite differences in approaches, without
exception, the value of the estimated deficit is substantial. Key studies and the infrastructure
deficit estimates they offer are highlighted below.
Arguably the most frequently cited report regarding the infrastructure deficit, the Report on the
State of Municipal Infrastructure in Canada (Federation of Canadian Municipalities and
McGill University, 1996), presents information collected by survey on the state of Canadian
municipal infrastructure (including transportation, water and wastewater systems and
community social service facilities). Based on responses from municipalities, the cost to bring
infrastructure to an acceptable level was estimated to be nearly $44 billion for the whole
country. The study estimated the transportation (transit, roads, bridges, sidewalks, curbs)
deficit represents 33% of the total, or $14.4 billion for Canada.
Forecasting from the 1996 FCM/McGill study, the Civil Infrastructure Systems Technology
Road Map (Canadian Society for Civil Engineering, 2003) estimates that the investment
currently required to rehabilitate municipal infrastructure is $57 billion, which if left
unchecked could rise to more than $110 billion by 2027.
A Capital Question – Infrastructure in Western Canada’s Big Six (Vander Ploeg, 2003)
attempted to determine how realistic other estimates of infrastructure deficits might be. This
study examined the degree to which spending on public capital has fallen based on an
historical review of local government capital flows (1961-2000). The study concluded that
“many of the measures of reduced capital spending by local governments do not appear to be
completely at odds with estimates of the municipal infrastructure debt, which depend on the
time they were made and range anywhere from $40 to $60 billion. While the estimates are
somewhat higher, they are not completely out of the ballpark.”
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In a comprehensive 2003 survey of its transit system members, CUTA collected detailed
estimates of capital infrastructure needs for the next five years. The survey, summarized in
Report on a Survey of Transit Infrastructure Needs for the Period 2004 – 2008 (CUTA, 2004),
found an estimated $21 billion will be required for transit infrastructure, including rolling
stock, between 2004 and 2008. Of that total, just over $12 billion was reported as part of the
transit systems’ current plans, and nearly $9 billion was identified as only possible with new,
external sources of funding.
It is abundantly clear from the work of the Task Force and many others that the infrastructure
needs in urban areas are very large. Urban areas are important and meeting those needs
through new investment, especially in urban transportation, is critical to support cities and
communities in pursuit of economic, social and environmental goals. However, the
infrastructure needs exceed the funding capacity of traditional partners – the users, the
municipalities and provincial governments. New sources of funding and innovative funding
arrangements must be found in order to address the substantial needs within urban areas. The
federal government has committed to a “New Deal” for cities and communities that would
include new funding and a new partnership with provincial and territorial governments in
collaboration with municipal governments. While the details of the deal have yet to be
revealed, the Task Force has identified two key considerations that must be resolved in the
establishment of a “New Deal”. These are funding arrangements and governance matters.
Current Models
Current governance models and sources of funding for urban road infrastructure and transit
were identified in the second survey conducted by the Task Force. The survey results are based
on information for 2002-03. Summary information is offered below.
Funding for urban road infrastructure in municipal areas varies by jurisdiction. For the most
part, the major sources of revenue are municipal and provincial governments, with
contributions provided by the federal government in only some cases. Some jurisdictions are
examining the potential of private sector investment and public-private partnerships to fund and
operate new infrastructure. User fees, or tolling, are also being adopted in some jurisdictions to
pay for needed new infrastructure. In Alberta, funding assistance equivalent to 5 cents per litre
of gas sold is allocated for transportation capital projects in Edmonton and Calgary; the cities
are responsible for establishing priorities relative to roads and transit.
Funding for urban transit also varies greatly from one province to another, as depicted in Table
3. In some provinces, urban transit is the exclusive responsibility of municipalities and fare
revenues and municipal funding are the sole sources of transit funding. In other provinces,
government support directly targets capital expenditures and operation of services while in
other cases the provinces do not systematically pay direct subsidies for capital or operating
expenditures, favouring other modes of financing such as unconditional grant allocations.
Some provinces also assume direct responsibilities for services. This is the case in Ontario
14
where the provincial government recently took back responsibility for GO (Government of
Ontario) Transit. Four provinces (British Columbia, Alberta, Ontario, Québec) have
established financing formulae that involve the collection of motorists’ fees or fuel taxes that
are then dedicated to public transit and transportation. In BC, a dedicated tax of 11.5 cents per
litre on fuel sold within the Greater Vancouver Regional District is directed toward
transportation. In October 2004, Ontario began transferring one cent per litre of its provincial
gas tax for transit capital projects across the province. This transfer will increase to one and a
half cents per litre in October 2005 and two cents per litre in October 2006. This will impact
the provincial funding share for public transit in Ontario.
Table 3. Current Shares (2002-03) of Public Transit Funding (Operating and Capital)
Identified in Task Force Survey
15
Several jurisdictions have created, or are beginning to consider the creation of, local
transportation authorities to provide public transportation services within major municipalities.
For example, in British Columbia there are two agencies that are charged with providing transit
services. BC Transit is the provincial Crown Corporation charged with providing public
transportation throughout the province outside of Greater Vancouver. In addition to managing
and operating the Victoria Regional Transit System, BC Transit plans, funds, manages, markets
and contracts for transit systems in 50 BC municipalities. Within the Greater Vancouver
region, transportation is the responsibility of the Greater Vancouver Transportation Authority,
known as TransLink. TransLink was established in 1999 to champion improvements to the
Greater Vancouver regional transportation network. To accomplish this, TransLink has not
only improved transit services, but also provided improvements to the entire transportation
network through major roadway improvements, signal and intersection upgrades, and
pedestrian and bicycle facilities. Transit services provided by TransLink include not only bus
service but also SkyTrain, SeaBus and West Coast express commuter rail. TransLink also
operates the AirCare emission testing for the lower mainland and supports transportation
demand management for the region.
In Nova Scotia, the provincial government and the Halifax Regional Municipality have
initiated discussions regarding the establishment of a Capital Transportation Authority to help
resolve the growing traffic/transportation related problems resulting from the growing urban
population.
New Opportunities
The federal government has proposed a “New Deal” for cities and communities, which would
include sharing a portion of federal gas taxes with provinces and municipalities for investment
in urban transportation and other infrastructure. In a survey, provinces and territories said that
any federal funding must be:
• New to urban areas. The capacity of the traditional funding partners has been exceeded
and a net new revenue source for urban infrastructure is critical. These funds would be
a new source of funding for provincial and municipal governments. It is an important
principle from the federal perspective that provincial/territorial governments not reduce
their funding to municipalities as a consequence of new federal investment.
• Equitable, flexible and balanced. Funding should account for local needs and priorities
and new funding should not be at the expense of investment in rural areas.
16
• Combined with good governance. Funding should be complemented by a governance
structure that ensures coordinated planning with a responsible, accountable, transparent
framework for all levels of government and independent transportation authorities.
An obvious potential new source of funding would be a share of the federal fuel excise tax.
The provincial and territorial governments have long argued that a portion of this tax should be
returned to them for investment in the national highway system. It would be a logical
extension to direct a share of the tax to urban infrastructure, primarily for investment in
transportation and transit.
The federal government has already committed to a rebate on the goods and services tax for
municipalities and this represents another means to reduce the burden on municipal
governments and allow room for new investment in urban infrastructure.
Existing capital funding program partnerships should be continued and new ones should also be
established. Even with tax rebates and revenue sharing, there will continue to be tremendous
need for investment and there will always be strategic projects where additional federal
investment will be essential.
Finally, in making its 2004 pre-budget submission, the Federation of Canadian Municipalities
noted that the focus should remain on outcomes, not mechanisms for funding urban
infrastructure. It is recognized that the funding decision will be the product of an
intergovernmental negotiation that involves many ministries and departments at both the
provincial and federal levels. The emphasis, regardless of mechanism, must be on securing
reliable, long-term, net new revenue sources adequate to meet the growing needs in urban
areas.
In addition to investing in transit and the urban road system, there is an array of other measures
beyond investment that all orders of government have at their disposal (either individually or in
partnership), which could support and promote sustainable urban transportation. These include,
but are not limited to:
17
• implementing supportive measures/tools for both freight and passenger transportation,
such as transportation demand management (TDM) and intelligent transportation
system (ITS) technologies to optimize system capacity,
• implementing and where possible integrating sustainable regional land use and
transportation planning strategies,
• adopting policies to reduce single occupant vehicle use,
• pursuing enabling measures, in support of sustainable urban transportation, such as
knowledge and capacity building, data gathering and information dissemination,
legislation/bylaws, regulations, standards, location of government employees and other
“employer” considerations, and fiscal measures,
• improving modal integration (passenger and freight) to provide seamless transitions
between modes and improve the sustainability, efficiency and effectiveness of the
entire transportation system.
Jurisdictions responding to the task force survey provided information on innovative practices
including approaches to planning, governance, service delivery, procurement, and accrual
accounting. There is great potential for collaboration amongst orders of government on such
approaches, which should be explored in more detail.
The challenges faced by urban areas call for new funding and better ways to collaborate
amongst orders of governments. In the document Partnering for the Future – A Transportation
Vision for Canada (2002), the provinces and territories emphasized the importance of working
in partnership with the federal government, with the collaboration of municipal and private
sector partners to build the best possible transportation system that:
• Supports economic and social growth and competitiveness.
• Is accessible, integrated, efficient and affordable.
• Offers maximum flexibility of choice.
• Is safe and secure and sensitive to our environment.
In the context of addressing urban transportation issues, the Task Force has debated a series of
principles that should guide an effective partnership amongst orders of government. These are
stated below with comments reflecting the support expressed by seven provincial respondents
(Alberta, British Columbia, New Brunswick, Newfoundland and Labrador, Nova Scotia,
Ontario and Saskatchewan) and the federal representative on the Task Force.
Unanimous Agreement
• Federal programs should respect provincial and territorial jurisdiction and planning
priorities.
Unanimously agreed by provincial respondents.
Transport Canada noted that the federal government has indicated a “New Deal”
for communities would require provincial and territorial acceptance.
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• Federal funding programs should not be contingent upon matching funding from
provinces and territories.
Unanimously agreed by provincial respondents.
Transport Canada could not comment whether future federal funding programs
would be contingent upon matching funding.
General Agreement
• Allocation of funding among provinces and territories should meet national objectives
such as economic competitiveness, trade expansion, and environmental sustainability.
Generally agreed.
Provincial respondents remarked this statement could be supported as long as
the national objectives are sufficiently broad in scope and are consistent with
provincial objectives.
Respondents recommend the words “and provincial” or “and regional” be added
after the word “national” in the statement.
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Generally agreed by provincial respondents.
In at least one jurisdiction, cities set their own priorities.
One respondent added that intergovernmental negotiation and cooperation
involving urban municipal representatives is possible although it may be
necessary to sign agreements only between the federal and provincial/territorial
governments.
One respondent recommended the statement be changed to read “Urban
transportation funding should be directed to priorities identified in a tri-partite or
bilateral (provincial-municipal) process.”
Transport Canada remarked that federal funding for urban transportation should
support national objectives and complement provincial/territorial, regional and
municipal plans reflecting agreed sustainable parameters.
Mixed Views
• Provinces and territories should have the flexibility to reallocate urban transportation
funding to areas not covered under any new transportation infrastructure program.
Generally agreed.
One respondent disagreed.
One respondent added that provinces and territories should have the flexibility
to identify urban transportation projects servicing inter-urban routes including
provincial transportation infrastructure within or leading to urban centres.
One respondent recommended that each provincial and territorial government
should determine the detailed program design and mix best suited to its own
needs and circumstances to meet agreed objectives. A provincial/territorial
government, which does not require the total transfer to fulfill the agreed
objectives, should be able to reinvest additional funds in the same or a related
priority area.
Transport Canada commented that projects would be expected to comply with
established parameters of funding programs.
• Allocation of funding among provinces and territories should be equitable and based on
a per capita formula.
Generally agreed although there was some disagreement with using a per capita
funding formula.
One respondent recommended that funding be allocated based on a relative
portion of the gas tax collected from each province.
One respondent noted that a per capita formula is a good start but it may be in
the national interest to make additional strategic investments in regions that
make a disproportionate contribution to Canada’s gross domestic product.
One respondent remarked that the allocation must ensure that smaller urban
centres receive their fair share of funding to invest in strategic transportation
projects.
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• The federal government should financially support urban transportation infrastructure to
meet economic, social, and environmental goals in large urban centres and the
essentially social mission of transportation in smaller cities.
General agreement although four respondents disagreed with the notion that
transportation in smaller centres is essentially for social missions and
recommended the statement be changed to read, “the federal government should
financially support urban transportation infrastructure to meet economic, social,
and environmental goals in all urban centres.”
One respondent recommended that the federal and provincial governments
should influence the investment so that federal and provincial visions for
economic growth, social programs, and environmental targets are considered
and incorporated.
• The largest portion of federal gas tax revenues should be reallocated specifically to
projects improving urban transportation.
Five of eight provincial respondents disagreed with this statement.
It was remarked that dollars should be allocated to areas of the greatest strategic
importance or where there is a demonstrable need to remedy deficiencies.
One respondent recommended a balance between large urban centres, small
urban centres and the provincial transportation network, suggesting the largest
portion of federal fuel tax should be directed towards highways.
One respondent urged the federal government to vacate the federal fuel tax since
it has no jurisdiction over municipal infrastructure.
Transport Canada indicated that the means to provide federal funding remains to
be determined; it is the purview of the Department of Finance.
Recommendations
Emerging from the needs, priorities and principles discussed above, the Task Force has
identified a set of recommendations that should be considered by all governments. The
recommendations received the endorsement of the Council of Ministers Responsible for
Transportation and Highway Safety in September 2004.
3. Governments must take action to improve transportation and travel time for
freight and passengers in urban areas through increased investment,
transportation demand management, improved planning processes and the use of
advanced technology.
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4. While respecting provincial and territorial jurisdiction and planning priorities, all
orders of government must find ways to work together more effectively to improve
transportation and mobility in urban areas. Opportunities for collaboration
beyond funding partnerships should be explored.
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