New Revenue Tools to Support Transit Infrastructure
The government will be guided by a number of principles when it comes to new transportation and public transit investments, and the revenue that will be raised to pay for them.
► Transportation needs vary across the province, and new investments should reflect the needs of different communities and regions.
► New revenue generated from transportation‐related activities should be dedicated to transportation projects in a clear and transparent manner so that the investment is directly tied to measurable results.
► Any new revenue tool should not unfairly impact one type of commute or community over another.
► New revenue tools should enable choice among the different transportation options available, while encouraging the use of public transit.
Highlights of Planned Infrastructure Expenditures by Sector
1CHART 1.13
2013–14 2014–15 2015–16
$ Billions
HEALTH OTHER2
TRANSIT
1Includes third-party contributions to capital investment (in consolidated schools, colleges, hospitals and provincial agencies), and federal government transfers for capital investments.
2 Other includes investments in the water/environment sector, justice facilities, and municipal and local infrastructure.
3Examples of major new hospitals include New Oakville Hospital and Humber River Regional Hospital in Toronto.
TRANSPORTATION/
HIGHWAYS Completion of major
new hospitals3 Capacity expansion
projects underway at colleges and universities
EDUCATION &
POSTSECONDARY
Opening the Rt.
Hon. Herb Gray Parkway to traffic
Construction on Toronto, Ottawa, and Waterloo transit projects
► New transportation investments must be tied to smart city‐ and region‐
building and efficient land use planning, and endeavour to accommodate each region’s changing population in the most efficient way possible.
These principles will help guide the Province’s deliberations after it receives Metrolinx’s June report on revenue tools for public transit investment in the Greater Toronto and Hamilton Area (GTHA).
Transportation Challenges in the GTHA
“Transportation bottlenecks in the Greater Toronto and Hamilton Area (GTHA) and throughout Ontario are hurting quality of life and productivity. The Big Move, Metrolinx’s plan to rebuild transportation in the GTHA, provides an opportunity to engage all stakeholders on how we pay for infrastructure, not just in the GTHA but across the province.”
Ontario Chamber of Commerce, Pre-Budget Submission, March 25, 2013.
“Congestion in the Toronto Region is not just a fact of life, it is changing how we live our lives. We all know it’s not a change for the better. We can no longer defer the tough decisions on how to address our region’s lack of mobility. In today’s ultra-competitive global economy, our competitors are investing in infrastructure that is helping them attract investment, jobs, and skilled workers. We, too, must act or fall behind.”
Carol Wilding, President & CEO, Toronto Region Board of Trade, Toronto Board of Trade (news release), March 18, 2013.
Recognizing the growing challenge of congestion in the GTHA, the Province created Metrolinx in 2006 to lead the coordination and delivery of a
transportation plan, The Big Move, for this critical region. Metrolinx has estimated the capital costs of projects under The Big Move to be $50 billion. There will also be associated financing costs and, as these projects come into service, they will require ongoing funding to maintain and operate over their lifetime.
Ontario is not the first jurisdiction to consider a range of revenue sources for funding transit infrastructure. For example, Los Angeles County Metro raises significant funds by issuing debt backed by dedicated revenue streams, which it uses to build carpool lanes and new rail transit lines. The Agence Métropolitaine de Transport in Montreal uses dedicated revenue tools to build and operate commuter rail and bus rapid transit reserved lanes.
The Province is committing to convert select high‐occupancy vehicle (HOV) lanes in the GTHA into high‐occupancy toll (HOV/HOT) lanes, in which carpooling drivers would continue to drive for free, but other drivers would be able to choose to drive in these lanes for a toll. Toll-free options would exist on all highways that have HOV/HOT lanes. This model has been successfully implemented in several places, including in Florida, Texas and California. The Province will consult with its partners and bring forward a plan by year-end.
The Province will continue to invest in priority public transit capital investments outside the GTHA, such as the Waterloo Region rapid transit and Ottawa light rail transit projects. It will continue to invest two cents per litre of provincial gas tax revenues in public transit systems across the province, an investment that has yielded $2.2 billion for public transit systems in Ontario since 2004.
But the Province recognizes the transportation needs of those communities and regions that lack public transit systems, and the need for better infrastructure in heavily travelled areas of the province. Therefore, this Budget includes
$100 million for small and rural municipalities for a new, dedicated fund for municipal roads, bridges and other critical infrastructure. The Ministry of Rural Affairs and the Ministries of Transportation and Infrastructure will consult in the summer of 2013 on the design of the program and make funds available by October 1, 2013. This fund would be in addition to the Municipal Infrastructure Investment Initiative, for which proposals were received by the Province in
April 2013. At the same time, the government will also consult on the components of a permanent program for roads, bridges and other critical infrastructure
investments in small and rural municipalities for the 2014 Budget.