Why It’s Time to Scrap Metrolinx

Metrolinx will create an inefficient, politically governed system that will result in higher fares and taxes.

Affordable, convenient public transit is vital, yet Canadian cities are plagued with costly, inadequate systems. Time and again, transit managements and politicians with public funds at their disposal embrace foolish, extravagant policies while ignoring commonsense alternatives and neglecting innovative thinking. Those decisions are paid for in higher fares, lost customers, rotten service, tax subsidies and lost opportunities.

– Founding letter of Consumer Policy Institute from urban activist Jane Jacobs

It’s back to the future for transit in Toronto and the surrounding suburbs. The rise of Metrolinx – the public transit behemoth created by the provincial government – and its juggernaut plan to build transit projects spanning Hamilton to Oshawa will create an inefficient, politically governed system. Transit customers will face higher fares and citizens across Ontario will face higher taxes while areas most needing transit upgrades will be left out in the cold.

Consumer Policy Institute (CPI) opposes centralized, top-down control of the region’s transit system, as represented by Metrolinx. We favour a competitive transit industry whose costs reflect revenues, rather than investments designed to curry political favour. Other transit systems around the world have introduced competition, in the process reducing subsidies, improving service and benefiting riders. Ontario can too.

BACKGROUND

Since the 1950s, transit systems have been used to deliver political agendas, where the costs of both their development and operation have largely been supported by tax revenues, rather than by revenues from operations. This disconnect has left customers dissatisfied and taxpayers on the hook.

Metrolinx is the latest incarnation of this model. It is first and foremost a political organization with the power to dig deep into the pockets of taxpayers and transit riders.

The initial idea for the agency came in the 2003 provincial election when candidate and eventual winner Dalton McGuinty called for the creation of a Greater Toronto Transportation Authority (GTTA) that would ensure “a region-wide approach to identifying and meeting GTA transit needs” and would have the “the clout and resources to tackle gridlock.”

It took another three years for the new agency to become a reality. When tabling legislation in 2006 for the new body, the Minister of Transportation ominously called the agency a more “focused” version of the previous Greater Toronto Services Board (GTSB). The GTSB itself was a failed top-down agency that attempted to oversee transit and other services across the region. The new body, officials lauded, would create “a seamless, integrated transit system” that would complement the provincial government’s other major plan for the region, the Growth Plan for the Greater Golden Horseshoe, that would oversee everything from density levels and employment areas to environmental protection across the GTA.

The 11-member board tasked to monitor the new agency was almost entirely made up of politicians from around the region, with the city of Toronto getting four seats and Durham, York, Peel, Halton and Hamilton each getting one . The remaining two representatives would be appointed by the province.

Ontario taxpayers were, and continue to be, the final backstop for the GTTA’s spending. The GTTA was established as a Crown Corporation that would, ultimately, “comply” with the Minister of Transportation’s “plans, policies and strategies.” Its financial activities – namely borrowing money or issuing securities – must be approved by the Minister of Finance. The province is also authorized to buy the agency’s debt or other securities.

Critics at the time called the new agency an “empty shell” amid complaints that it was tasked with vague plans to oversee “strategic planning” for roads and public transit operations that straddled multiple municipalities. Others said the agency would be unable to manage its own finances, which would limit its capacity to oversee an effective transit system, and was simply a move to gain favour with voters.

By the end of 2007, the GTTA ditched its confusing label and came up with a new name: Metrolinx. Since that time, the newly named agency has changed slightly, with the board now made up of politically appointed finance, planning and other transit specialists.

WHAT HAVE YOU DONE FOR ME LATELY?

Since its inception Metrolinx has come up with a variety of mega transit schemes that it promises will transform travel in the GTA, while also tackling congestion in the long-term.

Yet the first major announcement regarding Metrolinx’s plan for the future came not from the agency itself but from then Premier Dalton McGuinty in June of 2007, months before a provincial election. The government’s plan, which it called Move Ontario 2020, would see the province, through Metrolinx, spend more than $11-billion – with another $6-billion requested from the federal government – to build 52 transit projects across the region over the next twelve years. The projects ranged from extending the Yonge St. subway north into the suburbs to electrifying the GO Lakeshore line, building rapid transit lines in Hamilton and implementing the TTC’s ambitious Transit City proposal that would see it build light rail lines across the city. The municipalities were not required to put up any money for construction costs, but were expected to handle the subsidies needed to operate the new projects after construction.

By 2008 Metrolinx did release its own plan for the future of transit in the GTA, which it called The Big Move. It largely built on the projects previously announced by the provincial government. The new plan came with a $16-billion price tag for the construction of a six-station underground subway extension from the Downsview subway station to Vaughan, a 19-kilometre, largely underground, LRT built along Eglinton, LRTs along both Finch West and Shepard East, an updated Scarborough RT and dedicated bus lanes in Mississauga and York region.

In 2012, the agency added to its expansion plan with its even more ambitious Next Wave proposal. Under the new plan, which the agency expected would cost an additional $34-billion, Metrolinx would build everything from a subway extension on the Yonge St. subway to LRTs in Hamilton and Mississauga, the much-talked about downtown relief subway line, dedicated bus lanes across the region and all-day, two-way service on all GO trains.

All told, Metrolinx has laid out $50-billion in expenditures, making it more than twice as expensive as other massive public works projects such as the “Big Dig” in Boston and Three Gorges dam in China.

WHO WILL FOOT THE BILL?

While Metrolinx has come up with grand plans to expand transit across the GTA, it has no money. To finance the schemes, Metrolinx has called for a variety of new “tools” to pay for the construction of the new projects.

First, Metrolinx wants to raise the current sales tax of 13% by one percent to 14%. Second, a new 5-cent tax on each litre of gasoline sold in the province would be collected. Third, a levy on all off-street, non-residential parking spaces across the GTA would be levied, with the size of the levy based on the “current value” of the spot. And lastly, the agency is calling for a 15% hike in development charges on all new construction across the GTA.

TIME TO STOP METROLINX IN ITS TRACKS

The future is clear: Runaway costs for massive infrastructure projects that will ill-serve the transit needs of Torontonians. For Metrolinx and its political bosses, there appears to be no limit and no constraint to their gargantuan dreams.

It is time to break up Metrolinx and open Toronto’s transit systems to competition and investment in which revenues are able to cover the costs of operation and have transit users start calling the shots. Public control over transit has allowed politicians to satisfy themselves rather than customers, leading to the long-run demise of our transit systems. Ending Metrolinx’s control over transit across the GTA is the first step in ending this practice.

Brady Yauch is an economist and Executive Director of the Consumer Policy Institute (CPI). You can reach Brady by email at: bradyyauch (at) consumerpolicyinstitute.org or at (416) 964-9223 ext 236.