Transport Committee on Oct. 5th, 2011

[David Jeanes]

You must provide service for the people who will be working at unusual hours and the people who have to work at different hours, such as building cleaners.

[The Chair, Conservative, Merv Tweed]

Mr. Albas.

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

Thank you, Mr. Chair.

I appreciate the presentation.

You referenced “fairness” in your response to the first questioner. The federal government is quite concerned about fairness for all regions, large cities and small communities as well.

Can you tell us more about how you see that reconciled with respect to transit infrastructure?

[David Jeanes]

For many smaller communities, the transit infrastructure may in fact be buying a bus.

For example, we had a presentation at the session that I mentioned, organized at the Chateau Laurier last year by CUTA, from King County transit in Nova Scotia. They are providing a transit service that is almost entirely rural. The only capital assets they have are their buses. In that case, using grant money or gas tax money for that rather than for building rail lines or stations or busways or other fixed infrastructure facilities has to be accepted as a way of meeting the needs of those smaller locations.

As I mentioned, for some communities that need to have some basic transportation, a highway bus, or even a transit bus, is too large to meet their needs. That's a case where some collaborative efforts with taxi services and school buses and so on may be another approach.

But in every case, yes, fairness is needed. The fairness can be on a pure per capita basis, or it may be weighted to recognize that the smaller communities need a little more than just a per capita share in order to do something, or it could be, as Ontario decided, a weighting based on transit use. Those municipalities that had a higher level of transit modal split would be entitled to more of the gas tax, for example, than communities that had lower transit use.

There are different options, but I agree with you that fairness is important.

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

Thank you.

Thank you, Mr. Chair.

[The Chair, Conservative, Merv Tweed]

Mr. Poilievre.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

I just wanted to take the opportunity to respond to something that Mr. Sullivan was saying.

I think he correctly pointed out that smaller municipalities tend not to have public transit and therefore don't absorb those costs. I don't think there is an inequity, though, because there are additional costs associated with a small municipality that are not in place for a larger one.

For example, it costs roughly $1 million for a kilometre of pavement. There are far fewer taxpayers along that kilometre, and therefore the per capita cost of a stretch of roadway is much more expensive in a borough community. The same is true for any form of piping, electrical lines, and related infrastructure. The distances that snowplows have to travel between homes are much greater. As a result, the per capita cost of a lot of these same things are much higher in rural communities than they are in highly densified big cities.

I would just like to put that on the record to counter any notion that perhaps municipalities of a smaller population have a funding advantage under the gas tax system. In fact they do not.

I would invite any comments you might have.

[David Jeanes]

I certainly didn't mean to suggest that they did. I think the way I was trying to respond to the point was that exceptions in the way that gas tax funding may be restricted in its use should be made where it's really necessary or appropriate for certain municipalities.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

You're quite right about that. I agree with you.

[David Jeanes]

We mustn't, however, lose sight of the fact that in an aging society, we do have an increasing population without access to the private car. With the decline of the family, the extended family as a unit, many people can no longer depend on immediate relatives to provide them with transportation as they age.

One of the goals of providing at least some basic rural transit is so that people who are aging can remain living in the communities where they've spent their lives and can still have access to hospitals and shopping and so on. It's becoming increasingly difficult in many of those communities, particularly where downtown cores are being replaced by big-box stores in the suburbs--in Carleton Place, for example, near Ottawa.

So it's a complex problem. There's certainly no single solution. I think it's certainly a national problem and it's right for federal legislators to be interested in it.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Great. Thank you.

[The Chair, Conservative, Merv Tweed]

Mr. Toet.

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

Thank you, Mr. Chair.

Mr. Jeanes, thank you very much for your time today and for your presentation.

One of the things you talked about early in your presentation was inconsistent measures of safety. Can you give us some elaboration on that? You seem to have a great concern about how that plays out in the different areas across the country.

[David Jeanes]

I'll give you some examples. We have in Toronto a city that has had a subway system for 57 years. Not only has it built up the ability to handle the maintenance and even the expansion of that subway system through its own expertise, but it is also self-regulating with respect to safety inspections. That doesn't always work well. Some years ago there was a catastrophic accident and a fire on the Toronto subway. Really it was a case of safety measures having become somewhat archaic and no longer working reliably. With an outside federal regulator, that might not have been a problem.

Of course, since that fire and incident, Toronto is now in a much better position to guarantee safety. But smaller communities can't necessarily afford those resources.

Right now, for example, Ottawa is establishing the rail expertise necessary to build and operate the downtown transit tunnel and the 12-kilometre light rail line that will operate through it. But establishing a railway safety office in the city of Ottawa just to keep an eye on 12 kilometres of track, particularly if it needs to be at arm's length from the engineers and managers who are running the system, I think, becomes very difficult. It will be difficult as well in other cities that develop rail systems, such as Kitchener-Waterloo.

I really think there is a role for the existing federal government expertise. It will be in setting a very high standard by the federal Department of Transport; in investigations by the Transportation Safety Board; and in research by the Centre for Surface Transportation Technology, which is located here in Ottawa as an offshoot of the National Research Council, which is now actually largely privately funded. Those kinds of federal resources would be of immense value to Canadian municipalities as they move into transit technologies that may be new to them.

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

Thank you.

You also talk about research and development, and in line with that, you talk about the rail corridors that have been abandoned. They've been seen as surplus, so whoever is using them currently has seen no purpose in continuing with them.

[David Jeanes]

That's for freight operation.

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

That's for freight operation. Correct.

How do you see those corridors fitting within a new system? If they're not seen to be in a good environment or in a good position to move freight, are they in a good position to move people, and for what reasons do you see that?

[David Jeanes]

The good examples are Toronto, for instance, where Metrolinx is acquiring ownership of rail corridors up to Barrie, to Richmond Hill, to Stouffville, and so on. Those lines were really marginal in the freight business for major freight railroads like Canadian National or Canadian Pacific. There's really no economic reason to maintain such lines. However, it doesn't mean that you have to lose freight service, because if the line can be used and justified economically for its passenger handling capability, it may still be able to support freight, for example, at night on a limited basis and operated by the private sector short-line railway companies. This system works well in California, for example, where the rail line in San Diego is a public transit resource that is also used for freight service.

The River Line in New Jersey is similarly a light rail system operating between Camden and Trenton, New Jersey, that is also used by freight trains at off hours in a limited way. So it still provides some basic freight connectivity even though those lines are well below the threshold at which they would be considered viable by a major railroad.

So there are options here. They are being explored in the Ottawa area by Transport Pontiac-Renfrew, which is an initiative of Pontiac County in Quebec and Renfrew County in Ontario, to take over the rail line between Ottawa and Pembroke from Canadian National, which really has no further interest in it, in order to preserve it for both freight and passenger use.

[The Chair, Conservative, Merv Tweed]

Thank you.

Go ahead, Ms. Chow.

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

There are different mechanisms: tax points, capital projects, capital funding, or sales tax. Are there any specific proposals that you may have that would work better in Canada, or should it be a balanced approach where you have two or three different ways of funding public transit?

[David Jeanes]

There are different opportunities. When the City of Ottawa—in the year 2000 it was the Regional Municipality of Ottawa-Carleton—wanted to import light rail vehicles from Germany for a pilot project, there was an attempt to get the federal government to forgive the import duties on those vehicles. They were unique. No such vehicles were made in Canada. They were to serve a public purpose, providing a rail rapid transit service in Ottawa. Yet my understanding is that ultimately the import duties on those unique European vehicles had to be paid. There are areas involving customs duties.

I've already mentioned the income tax treatment, for example, where municipalities could issue tax receipts for donations of railway corridors and railway track, or where the government could positively encourage employers to subsidize transit passes.

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

I'm sorry, I'm not sure my question was clear enough. Whether you call it a strategy or a plan or a policy framework, in it I would imagine that you would look at long-term funding.

[David Jeanes]

Yes.

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

Some of the long-term funding may be capital funding, but some might be tax points and tax credits, etc. Then there would be a component that would do the research to help do an environmental scan to look at what is needed in different communities, large or small. Then there might be some discussion as to how to maintain the existing stock, for example.

Do you have a preference for how much or what percentage would be from capital funding and what would be from tax incentives, whether it's a gas tax or a sales tax?

[David Jeanes]

You're getting out of my area of expertise. I do know that it has been very important for Canadian railways to consider the capital cost allowances, for example, on acquisition of railway locomotives. We have often been viewed as being at a disadvantage against other countries in how quickly railways can write off the locomotives or other railway rolling stock they purchase. This may also apply with transit buses.

I'm afraid it's not an area where I have expertise. In general, once there is a policy of finding ways to facilitate the development and sustaining of public transit, there are obviously various fiscal tools that could be used. I'm afraid I'm not an expert to recommend one over another.