Transport Committee on Nov. 23rd, 2011

[Taki Sarantakis]

Yes. The philosophy behind the design of the programs has always been that we need partners to come forth and bring us their priorities to consider within what's to be funded. That is as opposed to going out and saying that this is what we want to see funded, so bring us projects.

Again, because we really seek to leverage federal funding, typically every federal dollar we spend generates at least another dollar, but more often it is two dollars. These really have to be the priorities of the municipalities, because it's not fair to expect them to pick up the cost of something if it's not their own priority.

[Blake Richards, Conservative, Wild Rose, AB]

Absolutely. Well, I certainly--

[The Chair, Conservative, Merv Tweed]

I have to interrupt you there and go to Mr. Albas.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Thank you, Mr. Chair.

I appreciate our witnesses being here today. Thank you for the presentation earlier.

In referencing that presentation, you mentioned that since 2006, the Government of Canada has made unprecedented commitments towards public transit. Since that time, federal infrastructure programs have committed close to $5 billion to regional and local transit priorities across the country.

Now, in an earlier briefing note that you did as a follow-up to one of our previous meetings, you mentioned that the federal investments are limited to the capital costs of public transit systems. Under the current suite of federal and infrastructure programs, operational expenditures, such as staff salaries, fuel, and maintenance, are ineligible for reimbursement across all investment categories, not just public transit. Most of these are then picked up by the municipalities through their tax base or through fares.

Can you explain the rationale for this position? Is it constitutional in nature, or is it institutional to Transport Canada...or otherwise?

[Taki Sarantakis]

Essentially, I think the primary reason that the federal government has historically avoided operation costs is twofold.

First, it introduces a level of discipline into the system. If you are going to be responsible, after the project is built, for the operation and maintenance of that project, then you are going to build a system that's commensurate with the size of your needs. If you really only need seven buses, you're not going to apply for 25 buses, because then you're going to be responsible for paying the gas, the upkeep, the maintenance, the drivers, the salaries, etc., for the operation of that system. So number one is that it introduces a level of discipline.

Number two is that with capital costs it's very easy to be able to show what's incremental and what is something that you were going to do anyway. With operating costs and salaries it's much less clear. So we have municipalities that come to us and say, for instance, we want to build this project but we're going to only use our own engineers; we're not going to use outside contractors. For us, then, it becomes a case of, well, how are we going to really figure out what you were going to pay for anyway?

So we don't want to be in a situation where we're just substituting federal tax dollars for other tax dollars. In previous programs that the government has run, that's been criticized by the Auditor General. Our capacity to show that the federal dollars are really incremental is much easier on the capital side than it is on the operating side.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Thank you.

You mentioned introducing discipline to the system and maintaining that discipline. It says here that it's also important to ensure that the criteria for federal funding does not deter needed maintenance of the infrastructure assets; as they own and operate most of the country's transit systems, municipalities are making important decisions on the allocation of operational funding.

So from that statement it sounds like we're saying that there are going to be long-term costs and we don't want to see deferred maintenance on a project that is funded through our partnership to eventually become unsustainable and rely on other forms. Is that correct?

[Taki Sarantakis]

Correct. We also don't want to see a situation where municipalities are failing to maintain their assets in the hope of getting a portion of that maintenance covered by some future program. We want infrastructure that's really commensurate with the size of the community and we want infrastructure that we know a community can support into the future. We don't want situations where municipalities are over-building and we don't want situations where municipalities are building something that they themselves cannot operate and maintain going forward.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

That's going back to your point about how it's very important for a community to actually not just communicate its priority but actually make sure it's within the scope of what's achievable for them and also sustainable over the long term. I guess, if you don't have that individual one-on-one community planning where they're coming forth with it, you may not have that kind of discipline and that kind of long-term vision. Is that correct?

[Taki Sarantakis]

Yes: again, it's easier to be able to apply for something from the community up towards the federal government than it is for the federal government to be dictating the criteria down. In a country that's as vast as Canada, with as many different regions and with the sizes of our cities ranging from five million in the greater metropolitan area in Toronto to hamlets and villages of a couple dozen people, it's quite a challenge to be able to incorporate all of that into program design.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

I'm sure I'm nearing the end of my time here, but I want to go back to the gas tax. One of the things I've been hearing in my area, from speaking to local government officials, is that when they look at the gas tax....

First of all, they're very happy to see that this government has said that we are going to make permanent the gas tax, because this has been brought forward before. It creates that stable level of funding. But one thing they'd like to see--and I haven't heard the inflation one come up from any local government--is even more flexibility in the rural areas, for example to be able to be light a light standard so that there's better safety on the road, not just the road itself. That's just some feedback coming forward.

Going back to the due diligence of a proposed project, you've listed in this briefing note here that there are a lot of things the federal government looks at when deciding to work in partnership with a municipality or with a province or with both in regard to public transit: improved mobility and reduced congestion, improved access to transit, increased transit ridership, increased transit modal share, improved travel times, improved safety and security of passengers and other transportation use, improved operational efficiencies, reduced emission of air pollutants, increased implementation of transit-oriented development.

In my particular area, people are always concerned, particularly in the rural areas, about improved safety and security of passengers--helping to make the system more functional. Again, as I said, we want to make sure roads are well lit, etc. Can you give us an example of a project that actually improved the safety and security of passengers?

[Taki Sarantakis]

How about I speak a little more generally?

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Sure.

[Taki Sarantakis]

Safety and security are very important, and we have some special rules on safety and security. In the provincial-territorial base fund, for example, we will allow a municipality to apply directly for urgent safety and security issues, even if they're not capital.

With respect to the types of things we do in transit safety and security, it tends to be things such as lighting and communication. Should situations arise, it's important for bus drivers and operators to be able to communicate back to dispatch or to the police.

As you know, we live in a society that is increasingly dominated by communications and surveillance equipment, which is coming down in cost, so a lot of municipalities are now monitoring their transit systems live via the web, primarily for safety purposes.

[The Chair, Conservative, Merv Tweed]

Thank you.

Ms. Chow.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Chair, I assume our committee will be coming back?

[The Chair, Conservative, Merv Tweed]

That's a decision of the committee. When we get there, we'll just have to see.

[Olivia Chow, NDP, Trinity—Spadina, ON]

All right.

Thank you for being here.

Do you support one fund that would have infrastructure and public transit? A lot of the municipalities are saying they want to know precisely how much, and are asking about having a public transit fund separate from the infrastructure fund. What's your view on that?

[Taki Sarantakis]

As an official, I don't have a view per se--

[Olivia Chow, NDP, Trinity—Spadina, ON]

Oh?

[Voices]

Oh, oh!

[Taki Sarantakis]

--but what I can tell you is that the way the government delivers the funds now, they tend to be omnibus in nature. Municipalities are able to apply for a multiplicity of things within that fund, including transit. Transit has historically been either one or two on our list of most-accessed funding.

In our review of the testimony that came before you, we didn't see a lot of people who had arguments with that. A lot of people tended to support it. Again, if transit is your priority, it will be something that's funded. If transit isn't, you can apply for something else.

[Olivia Chow, NDP, Trinity—Spadina, ON]

If a municipality or a province submitted a list where projects were ranked, what percentage of the time would you accept that list? Would there be times when you'd say, well, we don't like project number one, we prefer project number four, and that's why we will fund project four and not project one?

[Taki Sarantakis]

With most municipalities, it depends on the program.

[Olivia Chow, NDP, Trinity—Spadina, ON]

This is provinces and municipalities.

[Taki Sarantakis]

Yes: under the communities component of Building Canada, municipalities are limited to applying for one project per round. Again, that's an instance where municipalities give us their number one priority.