Richmond-Bridgeport independent candidate Charlie Smith gets down and dirty with TransLink's operating shortfall
Richmond-Bridgeport independent candidate Charlie Smith gets down and dirty with TransLink's operating shortfall
The public deserves straight talk from candidates on how to provide sustainable transportation funding while respecting the needs of transit users and taxpayers.
Public transit has mostly gone under the radar in this provincial election campaign. The Mayors’ Council wants candidates to commit “to fix transit’s broken funding model”, which will lead to a $580-million annual operating shortfall for TransLink.
The Mayors’ Council keeps repeating that it’s a $600-million shortfall. But that’s misleading. If you read the report, it clearly states $580 million and it will begin in 2026. Let’s start right off the bat by using the proper number and not fudging it upward by $20 million for PR purposes.
According to the Mayor’s Council, this shortfall would result in bus service being cut in half, SkyTrain and SeaBus trips cut by a third, and the potential elimination of West Coast Bus Service. It’s a horror story.
Under “Alternative 1”, which seeks to maximize ridership, SkyTrain and SeaBus would be cut by 10 to 15 percent; West Coast Express would be reduced from five to three round trips per day; and more than 140 bus routes would be eliminated, leaving only 90 bus routes continuing.
“Alternative 2” aims to maximize coverage, which would retain more bus routes in the suburbs. It would still result in the elimination of 65 percent of bus routes and cuts of 50 percent in SkyTrain service and 30 percent in SeaBus service.
At a Richmond Chamber of Commerce forum on Friday (October 11), respected public-affairs consultant Bruce Rozenhart asked me and other candidates in Richmond-Bridgeport and Richmond-Queensborough if we support the mayors’ desire for a better funding model. The moderator wanted a yes or no answer.
I didn’t want to respond to such a complex topic with a “yes” or “no” response. Therefore, I told Bruce that I would write my thoughts on my Substack page and email them. I also mentioned that I have serious concerns about capital spending decisions on transit, but that deserves a separate post.
As a result, I gave myself the homework assignment of writing this 2,000-word post on TransLink’s operating budget. Buckle up for the ride.
Let’s get real about transit finances
Public transit is vitally important for marginalized communities, students, and seniors. It’s also critical for the workforce, employers, and reducing car traffic, freeing up road space for the movement of goods on roads across the region. That’s to say nothing of air quality, which is better now than it was decades ago in the region.
I’m running in Richmond-Bridgeport to elevate public awareness about important issues. And I have written hundreds of articles on public transit over the years. So, I’m quite comfortable addressing this topic.
First and foremost, it’s important to understand how transit is funded.
Let’s start with the budget. Here’s one of my biggest beefs. In its operating and capital budget summary on its website, TransLink reports “taxation revenue” as one figure rather than breaking it out into the separate components.
TransLink used to make it easy to find out how much it expects to collect in annual property taxes, motor fuel taxes, and parking sales taxes. As a candidate, I demand that it reinstate these figures in its operating and capital budget summaries if it wants me to vote for more revenue.
You have to dig deeper into its 2023 statutory annual report to find these numbers—and they’re only available for individual years and not forecast several years into the future. For instance in 2023, $390.5 million was generated through fuel taxes—or nearly 15 percent of all revenue. That was down from $424.5 million in the 2022 statutory annual report.
Here’s the problem for TransLink, which I’ve written about for years. The regional transportation authority receives 18.5 cents per litre in fuel taxes. However, as more people drive electric vehicles, the total take is falling. And it will likely continue falling into the future. Not only will that hurt transit, it will undermine future maintenance of regional roads.
As a candidate for provincial office, I think it’s imperative that the legislature address this issue. But in return, TransLink must publish more transparent operating and capital budget summaries.
Later in this article, I have also attached a condition on Unifor, which represents two large transit locals.
The easiest solution to the fuel-tax imbroglio would be to raise the per-litre levy. But that punishes lower-income people who cannot afford electric or hybrid vehicles. I have a different approach.
According to Stand.earth, the B.C. NDP government’s subsidies for the fossil-fuel industry exceeded $1 billion in 2020. If elected and if TransLink and Unifor agreed to my conditions, I would introduce a private member’s bill to transfer $500 million in annual fossil-fuel subsidies to TransLink.
This would go a long way toward addressing the projected $580-million shortfall. That would also provide a longer-term cushion to offset future losses of fuel-tax revenues.
Increase the parking tax
Let’s move on to other revenue sources. In 2023, TransLink generated $463.1 million in property tax. That’s nearly 18 percent of TransLink’s total revenues. Many homeowners are already feeling stretched with higher interest rates, so I would not support increasing this rate of taxation.
The parking sales tax generated $83.8 million in 2023. It’s only three percent of total revenue. Sadly for motorists, this needs to increase beyond the 24 percent rate on parking rates. I propose increasing it to 33 percent, which would have generated another $24 million annually in 2023.
This hike would mostly be felt the most in downtown Vancouver where parking costs are highest. But there is also excellent transit service into the downtown, as well as an outstanding network of separated bike lanes. People would not feel the pinch nearly as badly in cities outside of Vancouver where there are fewer alternatives. That’s because overall parking costs are much lower outside of Vancouver and there’s lots of free street parking.
I know that the parking companies will holler about a higher tax, including one partially owned by the City of Vancouver. Too bad. Drivers have been subsidized for generations on public road expenditures, as documented by Victoria transportation researcher Todd Litman. A tweak to the parking tax is a small cost to bear in comparison to that.
Now, we’re up to $524 million of the $580-million shortfall.
Senior governments covered 25 percent of 2023 budget
Transit revenues accounted for $671.6 million in 2023—just over 25 percent of all revenues. It would be nice to eliminate transit fares, as proposed by B.C. Green Leader Sonia Furstenau. But I don’t think that’s practical in light of the budget crunch. I would recommend that TransLink continue with modest annual fare increases linked to the inflation rate to maintain this revenue source.
Another big chunk of the budget in 2023 came from “Senior Government Relief Funding” and “Senior Government Funding”--$648.4 million. That accounted for early 25 percent of overall revenues. Of this, $478.9 million was “Senior Government Relief Funding”.
This is really what the Mayor’s Council is freaked out about. Without this cushion, TransLink’s financial house of cards comes crashing down.
B.C. Conservative Leader John Rustad has promised two years of “stop-gap funding”. But that does not provide long-term stability. My proposal to transfer half of the fossil-fuel subsidies from Big Oil and Gas to TransLink will do the trick at no cost to taxpayers and transit users.
Moreover, Rustad has not released a fully costed platform. So, it’s hard to take anything that he says with any seriousness.
The B.C. Greens have proposed huge increases in transportation funding in their fully costed platform. In the first year, the party would boost spending on transportation by nearly $2 billion, followed by nearly $1.5 billion in Year 2 and $1.6 billion in Year 3. That would cover TransLink’s funding shortfalls with no conditions attached.
I feel that my approach is more fiscally responsible by having Big Oil and Gas cover most of the shortfall by taking away their subsidies. Plus, it would leave more money in the budget for health and education, which are two core functions of the province.
Moreover, unlike Furstenau or any other provincial party leader, I have attached a condition on a major transit union, which I’ll get to in a moment.
Meanwhile, I couldn’t find anything in the B.C. NDP platform on TransLink’s projected operating shortfall. The party told the Access for Everyone campaign that it is very supportive of investing in public transit. And it would continue “working with TransLink and the Mayors’ Council on the Access for Everyone plan to ensure service continues to be there for people”.
Ballooning Transit Police costs
I would have preferred more specifics from the B.C. NDP on such a critical area of public policy. However, I applaud the B.C. NDP’s proposal to unify provincial enforcement teams around gambling, liquor, traffic, transit police, and tobacco in one agency to reduce duplication.
The party’s platform does not say whether this new provincial enforcement team would also include transit police in Metro Vancouver. If that’s not the case, it should.
The cost of Transit Police shot up from $48.1 million in the 2022 budget to $61.7 million in 2024. That’s 28 percent over two years! I think that if the B.C. NDP’s proposal were to include Transit Police in Metro Vancouver—even if TransLink continued funding its portion—this could easily achieve $13.5 million in savings. That would bring TransLink’s cost back to 2022 levels.
That would bring my back-of-the-envelope funding solution to $537.5 million.
Now, let’s get to labour costs.
After two years (following a training period), transit operators were paid $39.19 per hour starting April 1, 2023, according to the collective agreement. That’s more than $80,000 per year before overtime and higher pay for working extra shifts. Unifor 111 represents more than 4,000 Metro Vancouver transit operators.
TransLink maintenance staff who’ve completed apprenticeships are all paid more than $50 per hour, which puts them over $100,000 per year. Unifor 2200 represents about 1,100 skilled trades workers employed by Coast Mountain Bus Company, which is a TransLink subsidiary.
In its budget, TransLink reports that in 2024, labour costs were budgeted to increase nine percent due to negotiated contract settlements, which included cost-of-living allowances.
The actual increase in the contracts signed by Unifor 111 and Unifor 2200 was lower. It was based on the annualized average of the BC CPI over 12 months at a minimum of two percent and a maximum of three percent. (Page 95 of the contract).
But there are other ways in which labour costs can rise. For example, in 2024, Unifor 111 and Unifor 2200 secured some improvements on vacation time for longer-term employees. Those with seven years service, rather than eight in the previous year, were eligible for an extra five days of vacation.
That meant 20 days off rather than 15. The duration period was moved back one year from 16 to 15 for those qualifying for 25 days vacation and from 23 to 22 years for those qualifying for 30 days vacation.
These are the niggling little contract measures that add to the cost of providing transit. That’s because when these workers are off for an extra five days, someone else must be paid to cover the shifts. An aging, stable workforce imposes more costs on the employer over time.
The role of Unifor
Then there are higher costs due to inflation, which has come down somewhat from the peak. I don’t believe that the figures are quite as high as TransLink is forecasting in the quote below.
“Maintenance and utilities for Bus and Rail Operations are budgeted to cost 16.8 per cent more than in 2023, primarily due to the inflation affecting costs of parts, and additional maintenance required due to our aging fleet,” TransLink states. “Contracted services, insurance, fuel and power expenses are also under inflationary pressures. Of the increase in ongoing operating costs excluding amortization and interest of 9.8 per cent in TransLink's expenditure budget, over 7 per cent is due to inflationary pressures.”
As a result of lower inflation, I would guess that this would add another $5 million to the cushion, bringing my back-of-the-envelope figure to $542.5 million.
This leaves us short of the $580-million goal by $37.5 million.
Here’s where Unifor needs to step up in the public interest. I know that Unifor’s western regional director, Gavin McGarrigle, likes to fight for his members. He’s been very effective over the years—one of the best union leaders in B.C. history, in my opinion. He’s pugnacious, tough, and employers know that he will support job action whenever it’s necessary to deliver a fair deal for workers.
As a result of his advocacy, Coast Mountain Bus Company transit operators and maintenance staff are very well paid and enjoy outstanding benefits. They get everything from a cleaning allowance for their uniforms to double time if they work more than a nine-hour shift. Gavin McGarrigle is worth every penny that the union pays him.
I also acknowledge that transit operators and maintenance staff do tough and sometimes dangerous work. But if the provincial government is going to transfer $500 million in annual revenue to TransLink, which will save many Unifor jobs, I am asking Unifor to give the public something substantial in return.
I ask that Unifor agree to roll over its 2023-2026 contract for Locals 111 and 2200 with the identical language and no pay increase from 2026 to 2029. I ask Mr. McGarrigle that he publicly support this on behalf of the more than 400,000 transit riders that his members serve so diligently.
In addition, I would ask for a similar salary freeze for TransLink and Coast Mountain Bus Company management over three years.
If TransLink and Coast Mountain Bus Company management and Mr. McGarrigle will not agree to this, I would not introduce a private member’s bill to transfer $500 million in fossil-fuel subsidies to fix the structural financial deficit at TransLink.
If they prefer the Rustad approach, which will inevitably lead to wholesale privatization and labour chaos, they can embrace that option. My offer avoids this and is a fair deal for transit users, taxpayers, and relatively well-paid transit workers and transportation managers. They all get to keep their jobs.
If the transportation managers and Mr. McGarrigle agree to this, I believe that this would offset the final $37.5-million shortfall. It would keep TransLink’s finances in the black until the next provincial election in 2028.
Voters in Richmond-Bridgeport who are worried about transit funding can be confident that I am financially literate and transit-literate. I’ve also delivered the most comprehensive response to the transit funding dilemma of any provincial candidate in the region.
I promise that if elected, I will try to act in the best interest of transit users and taxpayers. I believe that my plan to address TransLink’s operating shortfall achieves both of these objectives.