Commentary

Voting “yes” to new transit funding will benefit lower-income households

by Seth Klein, Marc Lee, Iglika Ivanova on March 10th, 2015 at 10:42 AM
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      A choice is before us. Metro Vancouver’s upcoming transportation referendum is a rare opportunity to significantly enhance transit services, boost local employment, and tackle climate change. 

      Metro Vancouver voters are being asked to support a 0.5 percentage point increase to the provincial sales tax (PST), which would raise $2.5 billion over 10 years. Together with contributions from federal and provincial governments this means an overall $7.5 billion capital plan for transit and transportation.

      New funding will not go to existing TransLink operating costs, but rather is earmarked for new infrastructure and transit capacity—a commitment that will be independently audited.

      The full 10-year transportation plan is designed to improve mobility for all of us in this region. It will mean road and bridge improvements, and substantial new transit infrastructure including 400 new buses, new rapid transit lines in Surrey and Vancouver, and new bike routes.

      These transit enhancements are especially vital for low-wage and immigrant workers, who often have to commute long distances, and who frequently work night shifts when transit options are currently limited (the mayors’ plan would see a 80 percent increase in night bus service). It’s also of special importance to youth and seniors, who rely more heavily on transit, and to seniors and people with disabilities who rely on HandyDART services (which would be boosted by 30 percent).

      The status quo of increasingly congested roads, long delays, and overcrowding is not a viable option. With Metro Vancouver’s population expected to grow by a million people, we desperately need more transit (for reasons related to both equity and climate), and we have to collectively pay for it one way or another.

      That said, many are understandably worried about the impact of a sales tax increase on low-income people. As social justice researchers, we share those concerns. But whether or not the tax increase is fair depends on how the tax is structured and what we use the money for.

      It is true that sales taxes in isolation are regressive, meaning that while upper-income households pay more in dollars, lower-income households pay more as a share of their income.

      However, the PST does not apply to core necessities such as rent, groceries, and child care, so much of what lower-income households spend their money on is exempt from the tax. For example, households with income of $20,000 would see their costs go up by about $4 per month.

      But it’s not enough to look at the revenue side alone—what we spend the additional revenue on also matters. For example, Scandinavian countries have much higher sales taxes than we do (Sweden’s is 25 percent), but their public expenditures on universal, high quality services greatly reduce inequality, making the overall tax system much more progressive than ours.

      In this case, because the new investments will go mainly to transit improvements, which particularly benefit lower-income people, the transportation plan is progressive overall. Because the plan will make transit faster and more convenient in every part of the region, it also means more people will be encouraged to switch from commuting by car to transit. Such shifts result in savings on gas, parking, and car maintenance. And if a family finds it can now do without a car, the savings amount to thousands of dollars a year.

      Last but not least, any regressive impact of a sales tax increase could be easily fixed. Given the political will (and enough pressure), the provincial government could increase the PST credit, boost the low-income carbon tax credit, or extend the discount student U-Pass to lower-income people.

      The proposal before us is imperfect, but it would be a mistake to let the perfect defeat the good. The mayors have presented us with a bold transportation vision for our growing region. We should not let our frustrations with the provincial government or TransLink stand in the way of this rare opportunity to improve our quality of life.

      If you’re angry about the choice of a sales tax increase to fund the transit plan, we invite you to channel your energies into pushing for a fair tax system rather than voting No on this proposal. We need new transit infrastructure, but we also need fair tax reform—and we will continue to advocate for both. 

      Comments

      15 Comments

      eastvan man

      Mar 10, 2015 at 11:09am

      Is there a referendum to change translink?

      J.M.T.

      Mar 10, 2015 at 11:11am

      No... no it won't. Nothing the government ever does, helps to benefit lower income households. What has the government done lately that really helps lower income people? Hmm... Teachers strike for an entire summer? Yup, I'm sure that helped out a lot of lower income households.

      J.M.T.

      Mar 10, 2015 at 11:29am

      Sorry. I love the "tackle climate change".

      Yeah, like this one addition to our public transit system, is going to save us from the dreaded changing climate for years to come.

      Rico

      Mar 10, 2015 at 12:22pm

      I thought for the benefit of the undecided I would get this out there before the Translink haters start their rant. Translink has problems and can be improved, but it is actually pretty efficient in the important areas. If you are thinking about voting No because you have heard Translink is super wasteful do some research that goes further than listening to a rich special interest group (CTF). You could look into the efficiency reviews conducted by Sound Transit or Calgary Transit, both of which used Vancouver as a comparison. Both showed Vancouver was the most or one of the most efficient system in all or almost all of the categories in all the cities studied. A report for Auckland Transit showed similar things. A local blogger who has a blog called Daryl's take has also done a comparison with all of the major Canadian cities. I have tried posting links before but I they don't seem to be allowed, so if you are undecided, spend a little Google time and you will realise like any big organization (public or private) there is waste and things can be done better.....but don't keep it from letting you vote to big improvements for everyone. Translink is much better than the haters like Bateman will admit (actually I am sure he knows it, but spin is important, that is why the CTF was very specific about which CEO salaries they compared and how they compared them)).

      Jason J

      Mar 10, 2015 at 12:26pm

      Political will is what the taxpayers are asking for.....from the Mayors. Their choice to waste our money to convince us we are wrong is, frankly, insulting. The people have spoken loud and clear, yet the mayors continue to ignore us and spend more and more to further THEIR agenda despite widespread resistance from the people they represent. The taxpayer. This vote will not only prove the lack of confidence in Translink, but also our elected officials. Come election time, this behaviour of discounting the taxpayer and spending tax dollars to further the mayors agenda will bring them all down in flames.

      frances

      Mar 10, 2015 at 12:29pm

      I can't believe people are stupid enough to fall for yet another snow job by voting yes. Baaa, the sheep bleat, "transit good". Of course it's good, so is motherhood.
      The yes side is trying to frame the debate as to whether transit is beneficial. This is misleading & deceptive. The debate should be, and the vote is, about the fairness of the existing tax system & the accountability of the authorities over the spending of those tax dollars.
      In 2008, the Campbell gov't rescinded the corporate capital tax on banks. Those lost revenues alone would easily replace the proposed sales tax increase

      just another Yes voter

      Mar 10, 2015 at 1:39pm

      It's sad that people think voting "no" will punish the Liberals, Translink or the "elite". That is exactly who is promoting the "no" side. They are the "all tax is bad tax" crowd that has reduced social programs and privatized public goods. They are the reason wealth is increasingly concentrated, the middle class is shrinking and the poor are barely surviving. They are not your friends, you myriad poor and middle class people. They are giving you the finger with this referendum. And they are laughing their heads off that you are stupid enough to vote "no" so they can sell you more cars and more oil tankers and more freeways.

      Anonymous

      Mar 10, 2015 at 1:40pm

      Hmm. We're paying two CEO's. We're paying armed transit police copious amounts of overtime to check tickets. We're paying for an idle ticketing system that will cause law suits over privacy and tracking as soon as it's up and running. We're paying and paying for things that have eff all to do with getting to work on time or climate change or anything else.
      I don't really care if they dig up Mother Theresa and get her to oversee the spending of their new big pile of cash. They've presented two scenarios...give us more money or suffer. I'm willing to wait for a new government that can offer a better alternative..like say business management that's more about spending on actual travel and not the surrounding fluff.

      Geof

      Mar 10, 2015 at 3:14pm

      Rico is right. There's plenty of evidence that Translink is well run. I'll see if links work for me. He mentioned the study by Sound Transit of their system in Seattle, which compared it with Vancouver and six others. Translink did very well. These graphs compare cost per trip and cost efficiency:

      http://tinyurl.com/p42vqr3
      http://tinyurl.com/orn956o

      The complete report: http://tinyurl.com/q7kd8ok

      Robert Sutherland

      Mar 10, 2015 at 4:47pm

      The yes/no debate particularly as presented by the "yes" side and within the left of center media and worst of all from our academic institutions with few exceptions is nothing short of an embarrassment. That Translink or the additional tax is emphasized as the primary fault line neglects the many citizens in Vancouver who are voting no because of the poverty of the option that has been presented to us as the solution and as back-bone of transit and how development proceeds in Vancouver for the coming decades.
      As the Vancouver Sun pointed out in a brief piece yesterday "...at one time, the Vancouver region had a rail transit system — the interurban — that reached farther than the SkyTrain and Canada Line..." and it should give people pause to think, as Patrick Condon a lone voice at UBC has shown, that for the same price as our proposed Broadway subway this entire system could be rebuilt including the local neigbourhood streetcar service.
      Heavy reliance on buses and a limited 4-stop skytrain "subway" to Arbutus as the 2-3 billion component of the Vancouver solution represents an impoverished political decision that puts the big developer cart before true public interests. A high quality mixed LRT and streetcar network using the Bombardier trams so popular during the 2010 Olympics would be a pleasure to use and be accessible to all demographics in a way that bus/skytrain will never be. This kind of service would also distribute density throughout the city by taking away obsessive focus from Broadway as our only possible east-west corridor and be a real option for those with cars by creating the kind of streetcar service that actually is the DNA of Vancouver's neighborhoods. This would also set the tone for the rest of the region. As for UBC a bus ride even from Arbutus as the terminus of the much lauded "UBC subway" is still a lengthy trip and would be over a decade away whereas LRT could be built right onto campus within 5 years using potential routes such as a mix including 41st, Broadway and FalseCreek/Arbutus Corridor.

      There are many reasons for voting "No."