Report of the Task Force on Transportation Funding

The Urban Environment and Development Committee recommends that:

(1)the report (April 14, 1999) from the Commissioner of Urban Planning and Development Services be adopted; and

(2)Council support the concept of a vigorous campaign to secure a share of the gasoline tax for transit in Ontario.

The Urban Environment and Development Committee submits the following report (April 14, 1999) from the Commissioner of Urban Planning and Development Services:

Purpose:

This report communicates the findings of the Task Force on Transportation Funding presented to the GO Transit Board on April 9, 1999 and recommends actions to improve transportation in the Greater Toronto Area and Hamilton-Wentworth.

Financial Implications:

The recommendations of this report pursue a funding partnership with the Federal and Provincial governments to meet 66 per cent of the costs of providing transportation in the Greater Toronto Area, and Hamilton-Wentworth.

Recommendations:

(1)It is recommended that Council endorse the resolutions of the Board of GO Transit on April 9, 1999 regarding funding of transportation in the Greater Toronto Area and Hamilton-Wentworth and in doing so:

(a)support and promote the establishment of a Transportation Funding Partnership consisting of the City of Toronto, Regions of York, Peel, Durham, Halton, and Hamilton-Wentworth, and the Provincial and Federal governments, the goals of which are to reduce congestion levels, ensure a competitive economy, assist in meeting air quality targets, reduce dependency on the private automobile and to provide a better quality of life for all Greater Toronto Area and Hamilton-Wentworth residents;

(b)support that the proposed Transportation Funding Partnership meet 66 per cent of the road and transit infrastructure needs in the GTA and Hamilton-Wentworth through a sustainable revenue sharing agreement with the Provincial government encompassing existing gasoline taxes, driver licensing and vehicle registration fees, and Provincial Sales Tax (PST) generated through vehicle sales and leases and strategic investments by the Federal Government;

(c)request the Premier of Ontario to authorize the Minister of Finance to initiate a review and consider, negotiate and recommend by November 1999, a sustainable Transportation Funding Partnership for the Greater Toronto Area and Hamilton-Wentworth;

(d)request the Prime Minister of Canada to authorize the Minister of Finance, to initiate a review and consider, negotiate and recommend by November 1999, a sustainable Funding Partnership for the Greater Toronto Area and Hamilton-Wentworth;

(e)refer the report entitled "Funding Transportation in the Greater Toronto Area and Hamilton-Wentworth Study Report" to the Greater Toronto Services Board for a presentation;

(f)request the Chairman and Transportation Committee of the Greater Toronto Service Board to organize and host a presentation of the "Funding Transportation in the Greater Toronto Area and Hamilton-Wentworth Study Report" to key stakeholders at the earliest possible date; and

(g)request the Chairman and Transportation Committee of the Greater Toronto Services Board to arrange meetings with the Ontario Minister of Finance and the Federal Minister Responsible for the Greater Toronto Area to present the "Funding Transportation in the Greater Toronto Area and Hamilton-Wentworth Study Report'; and

(2)it is also recommended that Council:

(a)request the Task Force on Greater Toronto Area and Hamilton-Wentworth Transportation Funding to present their findings at the upcoming meeting of the Federation of Canadian Municipalities; and

(b)request the Chairman and Transportation Committee of the Greater Toronto Services Board to meet with representatives of the Greater Vancouver Transit Authority (GVTA) and the Montreal Agence Metropolitaine de Transport (AMT) regarding establishing a partnership to pursue federal revenue sharing for urban transit.

Background:

In November 1998 the Toronto Area Transit Operating Authority (the GO Transit Board) resolved that the GTA/H-W Regions and the City of Toronto participate in a study to investigate opportunities for alternative funding for transportation in the Greater Toronto Area and Hamilton Wentworth (GTA/H-W). A Task Force was established consisting of transportation planning and finance staff from the Regions of Peel, York, Durham, Halton, and Hamilton-Wentworth and the City of Toronto. The Task Force retained the consulting team of IBI Group and Hemson Consulting in association with Strategy Corp and C.N. Watson and Associates to provide research and analysis for the Task Force. The consultants report "Funding Transportation in the Greater Toronto Area and Hamilton-Wentworth Study Report" and the resolution of the GO Transit Board are attached.

Comments:

(1)Findings and Recommendations from the "Funding Transportation in the Greater Toronto Area and Hamilton-Wentworth Study Report":

The Task Force was a collective effort by the Regions and the City of Toronto to determine the overall transportation needs and issues in the GTA/H-W and to identify solutions. The following are the major findings of "Funding Transportation in the Greater Toronto Area and Hamilton-Wentworth Study Report":

-The GTA/H-W economy and quality of life is supported by five Transportation Pillars:

TTC

GO Transit

Major Arterial Roads

Local Transit

Provincial Highways

All but Provincial Highways are now municipal funding responsibilities.

-Investment in roads and transit, even with Provincial subsidy before 1998, has not kept pace with the growth of transportation demand. The lack of expansion over the past 10-15 years has resulting in a decline in the quality and efficiency of transportation services. TTC has limited expansion funds beyond current commitments to the Sheppard Subway. GO Transit has been unable to provide sufficient services to meet existing demand because of the lack of capital to increase the capacity particularly at Union Station. Over 70 per cent of the GTA/H-W arterial road system is congested in peak periods.

-The GTA/H-W municipalities currently spend $570 million annually on capital investment for the 4 pillars of transportation - TTC, GO, regional roads and local transit. This is not adequate to prevent further decline of the system.

-Between 1996 and 2021 the GTA/H-W is expected to grow significantly.

-To improve transit services and reduce road congestion as well as accommodate growth $1.37 billion annual capital investment is required for expansion and maintenance.

The restructuring of municipal finance has resulted in municipalities bearing the responsibility for all capital costs and operating subsidy of four of the five pillars of transportation with the only revenue sources for both capital costs and operating subsidy being property taxes and development charges. Neither the property tax system nor development charges is capable of generating the revenue necessary to meet the annual gap in transportation funding of $800 million.

- Almost $2 billion annually is taken out of the GTA/H-W in transportation related taxes and fees by the federal and provincial governments.

The Province invests about $200 million annually in the GTA/H-W highway system. In addition to current municipal spending on transportation, additional transportation funding should come from a combination of sources involving the Provincial and Federal governments including sharing of provincial gas tax revenue, vehicle registration and licensing fees, sales tax on vehicle sales and leasing and strategic investments.

- In addition to the current municipal funding, a partnership of municipal, federal and provincial governments is necessary to secure the funding for the additional required investment in transportation.

(2)City of Toronto Perspective

The GTA/H-W has long been in an enviable position with respect to its transportation systems. Despite the different jurisdictions, transportation in the GRA/H-W acts as one integrated system. The road network accommodates commuters, extensive transit services in the City and the 80 per cent of goods moved by trucks. GO Transit and the TTC are noted for their cost-effective, high-quality services. However, the deferred maintenance and expansion has caused a decline in transportation services which is becoming a major issue in the GTA. The Toronto Board of Trade recently released their report Foundations for Strong City in which it stated:

" Despite an outstanding reputation, Toronto's transit and highway system are not keeping pace with demand. The growing congestion on highways and transit systems poses a genuine threat to the City's economic and social growth."

Transportation is a key determinant of Toronto's health and not meeting the growing demands can have a downward spiraling effect.

Even before the elimination of Provincial subsidies for roads and transit the City's capital investment in transportation was routinely deferred. Improvements to transit will require investments in roads to carry more buses at high levels of service. GO Transit is an essential component of the City's transportation system which provides an alternative to road travel. Without capital investment, particularly in Union Station, GO rail services cannot serve the demand that now exists.

The City's transportation system can be significantly improved to achieve several important objectives. These include improving transit services, reducing road congestion, increasing transit passengers and freeing up road space for goods movement, and accommodation of growth expected over the next 20 years. However, the City and other GTA/H-W municipalities cannot fund the full cost of improvements from the property tax base and development charges. No other jurisdiction in North America supports transit entirely from municipal sources.

As the most important economic region in the country, both the Provincial and Federal governments must recognize the responsibility they have in keeping the GTA/H-W strong. The Federal government's commitments to the Kyoto agreement to reduce green house gases should translate to a commitment to transit. Senior government investment in the TTC, the road system, and GO Transit is clearly necessary to support an area which accounts for 50 per cent of the economic activity of the Province. The TTC has initiated a campaign for gas tax revenue dedicated to public transit. Other jurisdictions in Canada, specifically Montreal and Vancouver, have successfully negotiated revenue sharing of provincial gas tax for public transit.

Conclusions:

A strong unified message from the City and GTA/H-W Regions is key to ensuring that the senior levels of government do not shut the door on their responsibility to fund transportation in the GTA/H-W. If there is conflict among the regions and the City about potential funding allocations, the Federal and Provincial governments will not be receptive to the messages calling for their involvement in funding. Securing alternative sources of revenue from the Provincial and Federal governments, in addition to the funding raised through municipal property tax and development charges, is necessary if the transportation system of the GTA/H-W is to be properly maintained and expanded to accommodate growth, reduce road congestion and increase transit levels of service. The time is now right to send the message that the City of Toronto and the GTA/H-W regions are in full agreement with the need to invest in transportation.

The City of Toronto should support the findings and recommendations of the Task Force on

GTA/H-W Transportation Funding and endorse the resolution of the GO Transit Board for a Transportation Funding Partnership with the regions and the Federal and Provincial governments.

Contact:

Anna Pace

Transportation Planning Coordinator

Metro Hall Office

Telephone: (416) 392-8117

Fax:(416)-392-3821

________

(Report dated April 1999, titled "Funding Transportation in the Greater Toronto Area & Hamilton-Wentworth", prepared by IBI Group, Hemson Consulting Ltd., in association with C.N. Watson & Associates, was forwarded to all Members of Council with the agenda of the Urban Environment and Development Committee for its meeting on April 19, 1999, and a copy thereof is on file in the office of the City Clerk.)

________

The Urban Environment and Development Committee reports, for the information of Council, having received a presentation by Anna Pace and Rod McPhail, City Planning, Urban Planning and Development Services.

Joan Doiron appeared before the Urban Environment and Development Committee in connection with the foregoing matter.