Transport Committee on Sept. 28th, 2011

[Mike Sullivan, NDP, York South—Weston, ON]

My point is that if it's all one big infrastructure dollar, different communities, of necessity.... All of them have similar needs when it comes to waste water, community centres, and potable water, but not all of them, as you freely admit, have a transit need. In deciding how the money is distributed, do you actually make allowances--which the gas tax doesn't do--that a city like Toronto would need proportionately considerably more money because it has a public transit need?

[Taki Sarantakis]

Absolutely, and actually, the gas tax is allocated proportionate to their population.

[Mike Sullivan, NDP, York South—Weston, ON]

I know. My point is that because it's allocated proportionately, a community that has no need for public transit is getting the same relative number of dollars as a community that does have a need for public transit.

[Taki Sarantakis]

Right, but they can direct that money to their other infrastructure needs. That's the nature of the omnibus programming that I described earlier: it allows each community to bring forward their priorities and to deal with them.

Let me give you an another example. Wharves and harbours are an eligible investment category under Building Canada. That doesn't mean anything if you live in Saskatchewan and it doesn't mean anything if you live in Alberta, but it means a lot if you live in Atlantic Canada.

So instead of having a funding program where we're distributing across Canada a wharves and harbour fund that means nothing to other pockets of Canada outside of the coasts, we have omnibus infrastructure programs that allow people to access those same dollars for their own infrastructure requirements. We recognize that they're different across Canada.

[Mike Sullivan, NDP, York South—Weston, ON]

I guess my point was that there's a base infrastructure of water, light, and heat that every community has. These are the base infrastructure of a community, but the larger the community, the more likely it is that the community will also need a public transit infrastructure on top of that base. If all you're doing is distributing on an even basis a gas tax or some similar proportional amount of money, you can't deal with that difference.

[Taki Sarantakis]

I see your point, but that difference has been largely made up through the accessing of the non-distributed funding, which is the Building Canada fund. The Building Canada fund is allocated per province, but not per municipality. The gas tax is different.

[Mike Sullivan, NDP, York South—Weston, ON]

Right.

[Taki Sarantakis]

It's allocated per province and then suballocated by municipality. So there are two different funding instruments.

[Mike Sullivan, NDP, York South—Weston, ON]

So the second funding instrument, then, in addition to the gas tax, would cover those big community and small community differences?

[Taki Sarantakis]

Right--

[Mike Sullivan, NDP, York South—Weston, ON]

Okay.

[Taki Sarantakis]

--and all those large transit projects that I mentioned earlier are coming from that second pot of money.

[Mike Sullivan, NDP, York South—Weston, ON]

So in the second pot of money you said that you do have some discretion, and you exercise that discretion. So if somebody is overbuilding... Let's say they're building a subway to pasture land in Vaughan, for example. You would suggest that maybe that's not a good way of spending your money.

You don't want to overbuild. You don't want to build a transit project that is just way too extravagant for the size of the community or the need you would determine, so you would have some say in choosing which ones you get to pick.

[Taki Sarantakis]

Well, the federal government approves all projects, so yes, all projects go through an assessment and a review process. But generally speaking, we don't see a lot of overbuilding, because one of the things we try to do is ensure that all of our projects are cost-shared.

To the extent that a municipality has to put up a third or 50% of the cost and a province has to match that with us, it tends to bring the focus into greater reality. If we were providing free infrastructure, so to speak, then yes, they would build in those pastures to nowhere. But because not only do they have to put up money themselves, they also have to convince the province to put money into it, it tends to regulate that.

[The Chair, Conservative, Merv Tweed]

Mr. Toet.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

Thank you.

I have a couple of questions. You talked about how the gas tax gives us a flexibility in the work that we're able to have done, and you said that public infrastructure needs vary across Canada, including public transit needs.

I also wonder if you could comment on this fact. Are there not also different needs they face as far as structural challenges are concerned in relation to location, other centres, their current infrastructure, and the layout of the particular city or town? There are unique and challenging physical landscapes and also unique and challenging climate issues. How do all those unique items in and of themselves create a challenge to the possibility of a national public transit strategy?

[Taki Sarantakis]

The greatest single issue that ties all of those things together is population density. In Canada we have probably six or seven major metropolitan centres with population densities that approach European population densities. In turn, those are the communities where you tend to find first-rate transit: the Torontos, Vancouvers, Montreals, Calgarys, and Edmontons. Outside of those, the population density in Canada drops dramatically.

When you don't have good population density, you tend not to have good public transit, because public transit really is a means of mass transit, and mass transit really depends on bringing a large population to a downtown core and then returning them. If you don't have that population density, public transit isn't necessarily your best option.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

Right, so you end up with a really diverse need, because there also is need for transportation within those smaller centres.

[Taki Sarantakis]

Exactly.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

So how do you end up dealing with those needs in conjunction with the needs of the larger centres?

[Taki Sarantakis]

Again, by allowing those proposals to float up from the bottom as opposed to being dictated from the top.

In a lot of communities their public transit could be as simple as buying a couple of small buses and running them in the morning and in the afternoon, not throughout the day. Or it could be as simple as just servicing a local attraction, be it a mall, a city hall, or a library. The needs vary. I think there are close to 5,000 communities in Canada. They range from small hamlets, villages, and townships of a couple of dozen people to our largest city, the city of Toronto, which, in the GTA, is about five million people. Obviously they will have not only very different infrastructure needs but very different transit needs as well.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

As a follow-up to that, in one of your responses you also talked about costing. As far as the costing goes, a lot of it has to do with what a community is willing to bear.

[Taki Sarantakis]

Yes.

[Lawrence Toet, Conservative, Elmwood—Transcona, MB]

Based on some of your experiences, could you just expand on that a little for us? Could you expand on that divergence in what communities are willing to bear?

[Taki Sarantakis]

Again, there's no public transit system in North America that recovers its capital costs. So every single public transit project, from an economic point of view, is not viable and needs to be subsidized. If you're entering into subsidies, it automatically means you're dedicating some tax dollars for that purpose that will go to no other purposes. So again, in some communities they're willing to bear that cost, because that cost provides other benefits; it creates a more vibrant downtown or allows them to service land at the outskirts that they wouldn't otherwise be able to access easily, etc.

So to the extent that every time somebody gets on a bus in Canada, their local municipality is subsidizing one-half of their fare on average, that's an important thing. It means that the community has said that not only are they willing to bear the totality of the capital costs but are also willing to subsidize each trip, because it's important to them. It's important for accessibility, as a lot of people cannot afford cars. It may be important for land planning. It might be important as a commitment to cleaner air.

The answer really varies by municipality.