Opinion: Victoria, Translink and tax dollars — Honesty or spin? Thumbs down on massive spending, poor management, and big inefficiency

MetroVanWatch is not taking sides on the upcoming transit referendum in the Metro Vancouver region, but we are happy to promote healthy public debate. We have received this submission from Peter van der Velden, a facilities management consultant living in Tsawwassen and are glad to share it here. His previous submission was popular: The $3 billion hoodwink: George Massey Tunnel Replacement Project.)

Translink file photo of train

Translink file photo of train

Victoria, Translink and tax dollars — Honesty or spin? Thumbs down on massive spending, poor management, and big inefficiency
(by Peter van der Velden

1. What is behind the referendum?

The issues around the additional sales tax referendum are very indicative of all that fails in the current Provincial Government approach. Responsibility is passed on and hidden or lost in a jurisdictional swirl that leaves us in the dark about costs and who should bear them.  Why, for instance does the Metro transit system own bridges? Is it because they need to be rebuilt (Patulla, Westham Island) or are losing money (Golden Ears) and Victoria does not want to pay for these costs? Isn’t this is just more off-loading of tax responsibilities? I would suggest that we are now being asked to pay for these infrastructure items through a tax that is incorrectly labeled; “to relieve congestion”.

2. What is the tax really for?

The government is asking us to pay this additional tax, not for the “operation” of Translink, but to cover additional infrastructure costs.  Costs like bridges, the Greenline and past debts built up by the Canada line (which was chosen in order to serve the Olympics). Translink is unusual in that the operating and capital budgets are combined, confusing the issue even further. Very few corporate or government entities can get away with combining operating costs and capital or start-up costs. The reasons are obvious: You can’t show profit or loss for a business if you can’t show what your operating costs are. If you go to the Translink photos website it actually states that “Lots of big things happened to transit in Vancouver in 2009, mostly in preparation of the 2010 Winter Olympics.” Does that sound like transit decisions that serve the general Vancouver public? Why were these costs not covered by the Olympics?

3. Capital costs or operating costs?

Historically civic infrastructure costs are borne by the government and paid out through the fairest tax distribution; income tax. Such costs are only put in place with “meaningful stakeholder participation” and planning. From the planning process government can make appropriate decisions and know what the costs will be. This infrastructure build-up is considered necessary for quality of life, fair access to housing and work and -in general- a buoyant economy.

Operational costs are dealt with in a less straight forward manner. Translink gets two thirds of their budget from taxes that are borne equally by people of all levels of income. Arguably due to inefficiencies, only 33% of Translink income comes from fares (down from 55% in 2009). Hence the dilemma. Victoria is asking us to voluntarily put in additional money for costs usually borne by the government. We can only assume that this is to off-load these costs and make their overall budget look better. However, it comes down to this; we are asked yet again to pay more.  Sadly these additional costs will not improve efficiency and the tax is not limited in time or scope.  Add to that bridge tolls, fare increases and property taxes legislated to increase annually and you have an open-ended system of financial abuse.

4. Are we getting good value? The answer is clearly NO.

To add insult to injury, these costs cover a system that appears to be very poorly managed. The “Compass” ticketing system, originally projected to cost $70 million presently sits a $194 million. And it still does not function. This alone should have caused some heads to roll. In the meantime, management compensation exceeds that of their equals in Toronto and Seattle.  Both cities are larger and have more effective transit systems. CEO Ian Jarvis was paid an increase in base pay of almost $80,000 from 2008-2009. As well there is a sizeable bonus in his contract. With Translink “performance level (compared) to four peer Canadian transit systems …deteriorating”, it is difficult to see how any bonus is justified.  In fact, management performance should be reviewed in light of their inability to see improvements in the system or its ability to serve people and recover costs. If this were a private corporation there would have been a  major shake-up in management long ago, and rightly so.

Sadly the additional revenue raised by the tax will not make the system more efficient. Translink needs to be more effective to be more self-sufficient! And that is the responsibility of its management. It truly has become a case of throwing good money after bad. Translink as an entity should be rebuilt and planned from the ground up. Bridges should be taken back from Translink and all capital debt from previous infrastructure build up should be taken from Translink “costs”. That would allow operating costs and the system as a whole to be realistically compared and valued relative to other systems.

5. Is the transit system or the “people moving” issue being planned?

The worst part of this is that this does not fulfill any criteria of good planning. Does it make sense that Victoria is not willing to subsidize a transit system, but will subsidize a $3 Billion (estimated) bridge over the Fraser? While cutting bus service to the same area? The transit system is positive planning in that it takes cars off the road. The bridge will only put more cars on the road and add to urban sprawl.  The associated costs to serve the sprawl, of course, are borne by the municipality serving the area. How can any municipality do any planning without having the wherewithal to deal with this political interference? Entities like Port Metro Vancouver can dictate that the Massey tunnel be removed and the Province (that is you and me) pays to replace it with a bridge. That bridge will open the Delta area the way that the Massey Tunnel did when it was built. There will be more demand for housing and Industrial land and none of this is being considered as part of the “people moving” issues of the Translink tax referendum. Bus routes are being cut from this area and we are being asked to pay more. Does this make any sense?

This leaves us with the issue of planning. All issues of transit, roads and bridges need to be planned by a non-partisan planning group. This means people trained in urban planning and not bound by political ideology. The plan needs to be holistic in its outlook, covering all aspects of transportation needs relative to growth and urban needs.  Only the result of such a transparent planning process would be reasonable for the government to put to a vote.

Only from such planning can appropriate decisions be made about how costs should be borne and how a Metropolitan area can grow. This planning can take into account such needs as that of Port Metro, but it should not be driven by it. Port Metro is irrelevant to transportation needs of Vancouver. It may be part of the need of growth for Vancouver but that would only be one aspect of the overall planning. Our firefighting approach to planning really does not serve any long-range goals and only covers immediate needs or a limited financial outlook. It really does not serve the public. It is really sad to see mayors spend public money to support the “yes” vote when it only serves their municipality and not the district.

6. What do we do now?

Speak up! Let the government and Translink know that we need planning and transparency. Fiscal responsibility is not just our responsibility it also belongs in Victoria and your municipality. We are constantly being asked to tighten our belts with increasing costs and decreasing disposable income. Government should be forced to do the same. Don’t just vote yes because your district will be better served by Translink, look at the overall usage of your tax dollar. Make government responsible!

Yes, we need more bus lines and we need more rapid transit. Should we be asked to pay for this? A lot of the arguments are spun to suit Victoria or Translink. One of the claims is that our property tax allocation is lower than other cities. What they don’t mention is that our property values are much higher than other cities making the property tax cost proportionally higher. Stop the spin, give us reality!

If our rapid transit cost is so prohibitive why are we not looking at alternatives? The system we are using is the most costly there is and no other city has bought into it for that reason. We are using this system because the Federal Government was only willing to subsidize the cost (at the time of Expo 86) IF we used this specific system. It is “political” reasoning like this and the decision to run the line to the airport for the Olympics that we are saddled with (capitol cost) debt that is not being paid off.

If we are being asked to pay for infrastructure, the government has the responsibility to show us business case analysis. Only when we can see that a business case is sound and serves us can we decide on its merits. When government deals with us in a transparent fashion, we can make good decisions. One good look at the “Yes” campaign should establish that we aren’t getting the information nor the transparency we need.

In the meantime, whether you vote ‘yes’ or ‘no’, be prepared for more GRRRRidlock.

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