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Metro mayors put car levy, sales tax back on table

Surrey Mayor Dianne Watts rejects the province
Surrey Mayor Dianne Watts rejects the province's suggestion that Metro mayors' ambitious transit plan be pared down or stretched over a longer period.
— image credit: Black Press file photo

Metro Vancouver mayors are shifting gears on how to pay for their massive transit investment plan, returning to previously discarded options like a vehicle levy or a regional sales tax.

Mayors' council chair Richard Walton said that now appears more likely after the province rejected any reallocation of its existing carbon tax revenue.

Although mayors had specified a new regional carbon tax as their backup source when they tabled the plan earlier this month, Walton now calls that "problematic" because it would largely act as an increase in the gas tax, which has recently become an unreliable source of cash for TransLink.

"If you raise the price at the pump, the gross revenue declines and that's self-defeating," Walton said after a Thursday meeting of the mayors' council.

"Ultimately it looks like we're moving back towards discussions concerning the vehicle levy and the sales tax," he said, adding that will require more discussions with the province this summer.

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According to plan documents, a regional sales tax of 0.25 to 0.5 per cent would generate $125 to $250 million a year.

An annual vehicle levy of $72, charged on top of insurance, would generate about $100 million. Options include a flat fee or one that varies based on a vehicle's emissions or how far it's driven in a year.

The plan needs new funding of $110 million per year initially, rising to $390 million several years in, although that assumes big capital contributions from Victoria and Ottawa.

Mayors have not yet set a firm date for the referendum the province requires on any new TransLink taxes – Transportation Minister Todd Stone directed them to pick one by July 15.

But Walton said late March or early April of next year looks likely, provided a date can be found when students and families aren't away on spring break.

That leaves very little time to hammer out the funding decisions and develop a public engagement strategy, Walton said, particularly with local mayors campaigning this fall for re-election.

"There's a massive amount of work to do," Walton said. "The timing of this could not be worse for us to do the job well. It's such a pity because this referendum, if it does go ahead, is probably the most critical vote in the region for a decade."

Several mayors expressed frustration that Transportation Minister Todd Stone has indicated the $7.5-billion plan is too costly and needs to be pared down or stretched out over 20 years instead of 10.

"Waiting for 20 years is simply not going to assist the region in any way, shape or form," Surrey Mayor Dianne Watts said, adding the province should lobby for the use of federal contributions other than the Build Canada fund.

"That's the plan. Thats what we need. It has to be done within the 10-year time frame."

She and Port Coquitlam Mayor Greg Moore Moore both said Stone must step up and enter active talks with the mayors to spell out what the province will accept.

"This back and forth has got to stop," Watts said.

"If the province thinks it can't afford it or projects aren't required they should come and work with us and tell us which ones they want to reduce," Moore added.

"To continually learn all of these new parameters through a press conference is not a good way for us to develop a partnership on how to deliver this."

More coordinated planning between TransLink and the province is critical, he said, because it would be unwise to build a new bridge without knowing how it affects other parts of the transportation system, or to build a rapid transit line without knowing if it will affect tolls generated on a bridge.

Some mayors suggested the choice of funding sources be left up to voters.

Moore said a preferential ballot could give multiple options.

Stone warned earlier in the week any plan and new taxes to pay for it have to be affordable to families.

But Moore argued the same lens should be used to scrutinize the do-nothing scenario.

"How will it affect affordability for families if your road system is clogged, and it takes you longer to get to work and you can't get goods to market?" he asked.

"The cost to the economy, the cost to families will be much greater if you don't do anything."

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