Certainly all levels of government can be involved. We also have to look at the experts and best practices. You gave the examples of Whitehorse and St John's. I'm sure other cities have used smaller vehicles, for example, so instead of having one 18-foot bus you could have—I'm just making this up—three smaller buses that are more efficient and can get to more locations.
You also have to throw in the best practices from municipalities that have had to deal with similar issues. I don't know how much the federal government has been involved in deciding on transit--probably not too much--but I don't have the expertise in that area. It makes sense to give funding to the people who know. As Jeff said earlier, long-term stable funding is needed so that municipalities can develop 10-, 15-, and 20-year plans--as in Ottawa. Then the municipalities can be assured that there will be funding available for an extended period so they can make intelligent decisions.