This is the second of two columns by John Lorinc today as Metrolinx announces the revenue tool recommendations for The Big Move. Read the earlier column on GTHA attitudes towards transit revenue tools released by Spacing and Innovative Research.
It is a balancing act both as daring and intricately planned as the one performed by Nik Wallenda over Niagara Falls last year. The Metrolinx investment strategy, formally released this morning after an interminable wait, is a case study in meticulous stakeholder accommodation, and looks impressively like the two best examples from elsewhere: Greater Vancouver’s Metrolinx, and Los Angeles County’s Measure R initiative.
Beginning with the premise that there’s a need for $2 billion in new taxes, the agency nonetheless put forward a plan that places a portion of the burden on businesses and developers (throw to Andrea Horwath), ensures that the projects to be financed with these new revenues are fairly divvied up between the 416 and the 905 (throw to Mississauga Mayor Hazel McCallion), kicks back a portion of the proceeds to municipalities to spend as they wish (throw to local politicians), includes various taxpayer accountability measures (throw to Tim Hudak, if he’s paying attention), and, lastly, provides a smart recommendation for a mobility tax credit for low-income residents as a way of offsetting the proposed HST increase (throw to, well, Andrea Horwath).
In the board meeting this morning where the report was approved, director after director stepped up to laud its balanced approach, including the usual cast of civic worthies and former partisans like Rae-era NDP cabinet minister Frances Lankin and Harris-era cabinet minister Janet Ecker.
As was widely reported over the weekend, Metrolinx is recommending a 1% increase in the HST, which will generate $1.3 billion per year; a 5-cent/litre fuel and gasoline tax ($330 million); a business parking levy (or about 25-cents/space/day, to generate $350 million) and a 15% increase to development charges ($100 million). As well, Metrolinx is calling to HOTs, paid parking at transit stations and land value capture.
The agency has estimated that for the average household, the annual outlay will amount to $477, although that figure could be much lower for those who don’t drive frequently and take transit (e.g. seniors and students) but as high as almost $1,000 for families that depend heavily on their car(s).
About 41% of the revenues will comes from inside the 416 and the 416, in turn, will receive about 42% of the project funding. Likewise, the 905 will contribute 59% of the revenue in exchange for 58% of the spending.
But while Metrolinx Bruce McCuaig said that some of the revenue will be hived off for the agency’s “share” of operating costs, the question of who covers the shortfalls over the long run remains murky, and is almost certainly a topic that will continue to dog the debate over how to expand transit across the GTHA.
Much will now depend on the political and legislative process that plays out over the next year or so.
Senior Queen’s Park sources told Spacing last week that the government hopes to table legislation implementing the new revenue tools in time for next spring’s budget. The legislation, which lays out both new taxes and spending, would be subject to a non-confidence motion by the opposition parties. In other words, the Liberals may face defeat over this agenda item within a year, setting the stage for both the municipal and provincial elections scheduled for 2014.
In the interim, the source said, the government will create an advisory panel to review Metrolinx’s recommendations and conduct further public and stakeholder consultations. But because municipal councils will have the authority to impose the parking tax and new development levies, the government will have to make changes to the provincial planning statement and the development charges legislation to ensure that these measures don’t get sidelined by obstructionist councils (you know who you are) or large property owners (ibid).
In a scrum after the board meeting end, McCallion, who appears to be speaking for the region’s municipalities in the absence of Mayor Rob Ford, said in no uncertain terms that she’s deeply concerned about the fate of this plan, given the political situation at the Pink Palace (my words, not her’s).
“Metrolinx has done its job,” she said, praising the report’s proposals. “Now it’s gone to the political realm, at Queen’s Park. What are they going to do? It’s going to take the local politicians and the public to tell Queen’s Park, get on with the job.”