Joining me today are Ms. Desmarteaux, Director of Strategic Planning at STM, Mr. Bélanger, Director of Government Affairs, and Mr. Porlier, Assistant to the Chair.
In a nutshell, STM is the 14th largest company in Quebec, We have 9,000 employees. The Montreal subway system has four lines, 68 stations and 759 cars. The first cars were made in 1963 and started to run in 1966; the second set of cars were made in 1973 and started to run in 1976 at the Olympics. Our bus fleet has 1,700 buses and only eight of them are hybrid at the moment. All the others run on diesel. We provide 1.2 million passenger rides each day. The STM handles 80% of all public transit use in the Montreal area, which is 70% of all public transit use in Quebec. Other companies in Quebec share this work among themselves: the transit networks of Longueuil, Laval, Quebec, Lévis, Trois-Rivières, Sherbrooke, Gatineau and Saguenay.
The company's budget for 2011 is $1.1 billion. Roughly half of the revenue comes from passengers and non-tariff revenues, around 50% that is. Montreal municipal taxes represent 34%. Government subsidies for special programs, especially from the Quebec and Canadian governments, are around 12%. We get 7% in regional contributions that come especially from the gas tax and registration fees, and the rest comes from other operation revenues in advertising and marketing.
In a public transit company, the expenses basically go to pay the staff: bus drivers, subway operators, fare collectors, mechanics who repair the cars and the buses. The 24% in goods and services include the diesel and electricity. There are also investment-related expenses. We will come back to that. Of our $14 billion in assets, the maintenance of our buses and of our transportation centres, as well as unexpected expenses, represent 11%.
On another page, I have included a graph that shows the entire history of public transit in the Montreal area since the end of WW2. At that time, there were nearly 400 million passengers in a year. There was a long decline afterwards because of Montreal households owning cars, the urban sprawl and the highway system being developed. You see a small peak in 1967; that's because of Expo 67, when the subway had just opened. There is another peak in 1976 because of the Olympics, when another section of the subway opened. And there is a big peak, a sharp rise, in the early 1980s, late 1970s when the unlimited monthly CAM pass was introduced. When you put a pass in people's pockets, they are going to use public transit. Then there were some fluctuations and you can see a rise over the past few years because of additional investments from the City of Montreal and the Quebec government in particular. This year, within a few weeks, we are going to beat the all-time record in 150 years, since the STM was founded on November 27, 1861. It has taken us 150 years to beat the 1947 record, with 405 million trips.
Our company has won a number of awards, including
the American Public Transport Association “best of the best” in North America award as a public transit society.
According to Imperial College, London, the Montreal subway is the world's most productive subway in terms of mileage.
Montreal also won the MetroRail award. Subways around the world were compared to each other and we received an award for our commitment to sustainable development. That was two years in a row. On top of that, Moody's Investors Service and Standard & Poor's gave us excellent credit ratings for our loans.
You have a graph that summarizes the 2020 Strategic Plan, STM's strategic plan for the next 10 years. The plan is available in French, and you can watch a 20-minute presentation in English on the website: www.stm.info. You will notice three lines. The green lines indicates the current trend. The blue line is Montreal's 2008 Transit Plan, including additional investments for rolling stock, designated lanes, streetcars and extending the subway. The orange line is a combination of the current offer and a new service offer, without taking into account the increase in people driving alone in cars. Based on that, with a modal shift, we expect to see 540 million trips by 2020.
You are very familiar with the other graph. It shows the population growth in Canadian cities. When we say “population growth in Canadian cities”, we mean “the dynamics of mobility and mobility problems for goods and employees”. Those are the projections for each of your regions and your cities and I am sure you know them better than us.
Let's take a quick look at another chart. Our 2020 Strategic Plan includes a scenario with 50 streetcars, mainly in downtown Montreal, in order to support the growth in ridership. We have also just purchased 468 new metro cars from the Bombardier-Alstom consortium as part of a $1.2 billion contract. We also want to increase our bus fleet from 1,700 buses to 2,100 buses by 2020. All the buses that we are going to buy will be hybrid vehicles from now on. We currently have buses that run on diesel. Our new buses are going to be hybrid, and we are slowly going to introduce electric buses as well.
At STM, we anticipate investing $11 billion over the next 10 years in the subway system, in cars and extension, even though the Agence métropolitaine de transport of the Quebec government will be fully responsible for the extension. As for buses, we are thinking about buying new vehicles and replacing the fleet. The streetcar project is estimated at a little over $1 billion.
Another graph shows the federal government's growing support for public transit in Montreal and elsewhere in Canada. You can see the progression for 2011 in this graph. The Canadian government's contribution to STM is around $73 million, which has been invested mainly through Building Canada projects. This was possible with the funding from the excise tax on petroleum products via SOFIL. The Canadian government has directly funded the Urban Transportation Showcase that involves testing hybrid buses—a research and development project—and a program you have set up, the Transit-Secure Contribution Program that contributes to national security by allowing devices and cameras, STM devices, to be installed in the Montreal subway.
Some of the STM projects that were funded by the federal government via SOFIL include: the OPUS card, a smart card making it possible to pay for the fare in the bus or in the subway; the purchase of service vehicles; the purchase of buses; and the IBUS project, a real-time information project for our clients and for managing our operating buses.
Of course, I am not going to go into details on the chart that follows, with the $11.4 billion. In broad terms, the sum is divided into two. The first amount is for asset maintenance, which is essential for us. The company's assets amount to $14 billion. Maintaining them in good operational condition is a must. The second amount, for a total of $5 billion, is for optimization and development. So a significant part of the budget, just over $6 billion goes to maintenance. The items are listed in order of importance. That is the order of priorities for our projects. If we don't have all the money we need, the funds will be allocated in that order, from first to last.
You can see the data on public transportation in relation to Montreal's economy on page 13. You will see how much money was invested in public transit and what the spinoffs were for the metropolitan community of Montreal. The data is from a study done by the Board of Trade of Metropolitan Montreal. The study shows the added value and the direct and indirect jobs that were created, the impact on Canada and Quebec's revenue, meaning on taxes, and finally the impact of public transit investment, which is three times greater than that of private transportation by car. This can be explained by the fact that public transit is three times less expensive than private transportation by car. This allows households to save money that they can invest in other areas of the economy of Montreal, Quebec and Canada.
This is the second study of this kind done by the board of trade.
Let me end with our recommendations. We recommend that a national fund for public transit be created to ensure predictable and long-term funding. Predictability and long term are very important for the current strategies.
We also recommend that funds be indexed. In metropolitan Montreal, a 1.5¢ gas tax was put in place in 1996 and it stayed the same for almost 12 years. That means that the fund went down relative to inflation. So our recommendation is to index the funds, especially the gas-tax fund, which we get through SOFIL.
Our final recommendation is to ensure that public transit remains eligible for the next generation of infrastructure funds in upcoming years. In some cases, it has to do with job creation programs. In other cases, it has to do with programs developed to maintain infrastructure at a national level in order to have a competitive economy.
I am going to leave it at that and let me give you a hand for taking public transit.
Thank you.