No TransLink Tax: A Better Plan

EXECUTIVE SUMMARY

It didn’t have to be this way.

TransLink could have not wasted so much of our money on silly gimmicks and instead put precious tax dollars into important things like maintaining the Expo Line properly and avoiding massive shutdowns.

We could have had TransLink executives and a board of directors held accountable by our elected officials when they greenlit bad projects that didn’t move a single person a single inch, when they acted in an unaccountable, high-handed way, or when they continually came in for more money and more perks.

The premier, the minister of transportation and the TransLink Mayors could have pushed harder to stop TransLink waste before it got out of hand, before we had dozens and dozens of examples of our money being devoured by bad planning and a poisoned corporate culture. Our elected leaders could have stood up for us, reminding the board and the executives that they had been handed a sacred trust – and firing them when they failed the taxpayers and riders footing the bill.

The TransLink Mayors could have worked together to prioritize their $7.5 billion wish list, thinking instead about what the region and its taxpayers could bear, not what they could package politically.

The TransLink Mayors did not have to pitch a new sales tax. TransLink did not have to allocate $4 million of your tax dollars to try and “educate” the public to vote yes. The provincial government did not have to spend $5 million to prepare a mail-in ballot on a tax few are excited about.

As a new independent accounting analysis of the TransLink Mayors’ spending plan reveals, they could have funded their wish list without a sales tax that will hurt struggling seniors and financially-squeezed families, already facing another expensive year of property tax, MSP, Hydro, ICBC, Ferries, EI, and CPP hikes.

The 50-page analysis, done by a Certified Management Accountant, shows that local government – Metro Vancouver, TransLink and the 21 Metro municipalities – will see an annual revenue growth rate of 4.8 per cent over the next decade.

By earmarking just 0.5 per cent of that 4.8 per cent growth rate to transportation priorities, the TransLink Mayors could have generated enough revenue to spare us the sales tax.

Their cities would still see 4.3 per cent growth, a rate far exceeding the inflation and the growth at the federal and provincial levels. This contribution would have likely enhanced their position in TransLink discussions, giving them the greater voice they claim they crave.

It could have all been so different, if only someone on the TransLink file had shown real, gritty, tough leadership. Where were the leaders willing to do the hard work, pushing back against raising taxes and finding the money within government’s ever-growing revenues?

Where were the other organizations which were supposed to be watching out for small business owners and cash strapped working families? Why weren’t they pushing for less TransLink waste and other funding options?

In the absence of common sense leadership from our elected officials, voters must step into the vacuum. Taxpayers should visit www.NoTransLinkTax.ca to learn more about this failure in leadership. Lower Mainlanders must vote no to the TransLink sales tax, and force these politicians to fix TransLink and aggressively address waste in the system. From there, they can prioritize their plan and earmark a portion of the revenue windfall local governments are projecting to fund transportation.

It can all be so different – but only if taxpayers show the politicians the way.

 

INTRODUCTION

TransLink has wasted too much of our money to be trusted with any more of it. Like pouring water into a leaky bucket, we know what will happen to money entrusted to TransLink: much of it will be wasted.

Crushing TransLink’s culture of waste must be the first task of our elected officials. They took the easy way out, failing to follow former Alberta premier Ralph Klein’s tenet: “Any politician can raise taxes, it's a no-brainer. We have to give people a break. The only way taxes are going is down.”

The TransLink Mayors went the no-brain route, raising taxes, deciding that fighting for taxpayers, and going up strong against the TransLink Board, TransLink executives and Transportation Minister wasn’t worth it.

“Members of the Mayors’ Council are committed to exhausting all available options before asking households and businesses to increase the amount that they pay in fees or taxes,” the TransLink Mayors’ Report says (p. 34). This is demonstrably false. Rather than attacking the waste at TransLink, 18 of 21 mayors voted to demand a tax increase. Instead of pushing the Minister of Transportation to help crush TransLink’s culture of waste, they asked for a tax increase. The TransLink Mayors begged for a portion of provincial sales tax – demanding efficiency from the provincial government – but failed to look at TransLink itself, or anywhere else within local government, for savings.

TransLink Mayors exhausted only one option: tax hikes. They exhausted the tax increase possibilities, considering carbon taxes, sales taxes, road pricing, vehicle levies and others. But they never considered finding money within the $7 billion (and growing) which local government, Metro Vancouver and TransLink collect in the Lower Mainland each year. They failed to push hard enough for taxpayers to get TransLink to end their silly record of waste. Instead, they demanded more from taxpayers already reeling from years of tax increases.

 

THIS IS A TRANSLINK TAX

The TransLink Mayors and other tax supporters are desperate to avoid using the word “TransLink.” They fully understand that the majority of taxpayers know TransLink has wasted incredible amounts of money over the past decade.

But they cannot escape the facts: this is a tax increase to fund TransLink. TransLink will build whatever projects are built. TransLink will own whatever is built. TransLink will manage, or mismanage, whatever is built. TransLink will operate whatever is built. TransLink will maintain whatever is built.

This TransLink tax will bloat TransLink’s operating budget from $1.4 billion this year to $2.2 billion a decade from now (TransLink Mayors’ Plan, p. 31). That’s more money for TransLink. It will also drastically increase TransLink’s debt servicing costs: from 1 of every 12 dollars collected by TransLink today to 1 of every 6 dollars collected in 2025.

“TransLink, which is responsible for providing the regional transportation system…” says p. 20 of the TransLink Mayors’ document. “The Mayors’ Council charges TransLink to take a more direct role as a convener of multi-partner dialogue and transportation planning,” adds p. 21.

Indeed, TransLink is mentioned 55 times in that document, despite the politicians’ and apologists’ cynical efforts to pretend TransLink isn’t part of the plan. Any attempt to sever TransLink from this tax is political spin.

Further, this is another tax source for an agency that already has a ton of them. TransLink’s 17 cents per litre gas tax, 5 cents per litre share of the federal gas tax, BC Hydro levy, ever-growing property tax, and 21% parking tax led the independent transit commissioner to say, “TransLink’s funding formula is the best in Canada.”

TRANSLINK’S RECORD OF WASTE

The TransLink list of waste is sickening:

Six boards of directors, making three-quarters of a million dollars every year. All meeting behind closed doors. More than 400 staffers making six figures. Executives cashing in bonuses and claiming car allowances while raising taxes and fares. The Main Street poodle on a pole.

The transit police dog squad leaving explosive material on a commercial jetliner during a training exercise. Installing 13 TV screens at a cost of $40,000 each – and having more than half of them out of service a year later. Bonuses of 25% for every employee who works on a Sunday. At least $60,000 a month leasing an empty building – called “outright waste” and a “poor financial decision” by the SkyTrain union head.

Tens of millions of dollars in Compass Card and fare gate cost overruns – plus being three years late. Paying stakeholders with charitable donations to get feedback on a survey – spending Delta’s Mayor likened to “a drunken sailor… it’s terrible.”

Moving to a shiny new office building in Sapperton while paying hundreds of thousands of dollars for unused office space in Surrey. A quarter-billion dollars in revenue lost to fare evasion since 2000.

Failing to address bus driver assaults. Blundering sound wall design and installation along the Golden Ears Bridge route – a waste the Pitt Meadows mayor described as, “roll the windows down and throw the money out of the window.”

There’s many, many more examples of TransLink waste: keep watching www.NoTransLinkTax.ca and the No TransLink Tax Facebook page for those.

As Derek Corrigan said, TransLink is the beast that eats money. And now TransLink Mayors want to give it a $7.5 billion buffet, funded by taxpayers.

 

CAN’T TRUST TRANSLINK

Given that record of waste, it’s no wonder TransLink has lost the confidence of so many taxpayers. Further, TransLink has misled taxpayers about how they would address taxpayers’ concerns.

Despite a public declaration by TransLink chair Marcella Szel that 2013 executive pay had been frozen at 2012 levels and bonuses had been eliminated, every single TransLink executive was paid more in 2013 than the year before.

TransLink CEO Ian Jarvis got the biggest jump in pay – which included $83,700 in bonuses. Jarvis made $422,406 in salary, bonuses and taxable benefits in 2013, plus $45,609 in pension contributions and other benefits, for a total compensation package of $468,015. That’s nearly 7% more than in 2012.

Every other TransLink executive got raises too:

  • CFO Cathy McLay was paid $383,905, up from $330,753, including a $31,721 bonus.
  • Human Resources head Sandra Hentzen was paid $325,459, up from $289,958, including a $26,922 bonus.
  • Bus company president Haydn Acheson was paid $329,130, up from $296,034, including a $27,540 bonus.
  • SkyTrain boss Fred Cummings was paid $321,736, up from $293,443, including an $18,643 bonus.
  • Communications boss Bob Paddon was paid $311,844, up from $307,857, including a $17,507 bonus.
  • COO Doug Kelsey was paid $377,702, up from $377,054, including a $22,400 bonus.

So much for the pay freeze. Further, TransLink and its subsidiaries paid 434 people more than $100,000 in 2013, up from 393 people the year before. That includes the Transit Police, where 56 of 154 officers made six figures.

TransLink grossly overpays its executives compared to transit systems in Toronto, Montreal, Portland and Seattle.

Over the past few years, CTF, political and media scrutiny of TransLink has forced multiple high-level audits, all of which have come back with recommendations on how TransLink can be more efficient. These audits didn’t drill down into specific program spending, which would have revealed millions more in savings.

Further, the TransLink commissioner found that while frontline bus service is being squeezed, corporate costs continue to grow at TransLink head office. “Even excluding Compass card and fare gates, and studies, corporate costs increased by 11.2% between 2012 and 2015, which significantly exceeds inflation,” the commissioner wrote.

 

THE GROWING TAX BURDEN

Governments are usually careful to make sure their taxation schemes are competitive with neighbouring jurisdictions. Virtually every government, at every level, compares themselves to their peers to ensure they are not driving out taxpayers with unnecessary higher rates.

The B.C. government is no different. Buried in the back of every provincial budget document is Table A3, comparing six tax scenarios for families, individuals and seniors in every province in Canada.

Not too long ago, these charts showed B.C. had the lowest personal income taxes in the country, which used to be the source of much back-slapping and self-congratulation for the BC Liberals.

Unfortunately for taxpayers, that is no longer true. In four of the six scenarios listed in the 2013-14 budget document, B.C. now trails other provinces.

In the most common scenario, Saskatchewan and Ontario are beating us on provincial income taxes alone, and B.C. has fallen to third place on total tax burden behind Alberta and Saskatchewan.

According to Statistics Canada, the average B.C. household makes about $70,000 a year. Using the closest B.C. budget scenario – a double-income family of four, making $60,000 a year – taxpayers pay $1,362 in provincial income tax in B.C., compared to $1,035 in Saskatchewan, and $1,164 in Ontario. Alberta sits at $1,777.

Add in property, sales, fuel, carbon and Medical Services Premium taxes, and that average B.C. family pays $6,736 in provincial taxes – nearly $2,800 more than Alberta and $1,600 more than Saskatchewan.

Alberta’s lack of sales and MSP taxes catapult them into first place. It’s no small amount – it’s like a new, extra $50 bill in your pocket every single week of the year plus a $200 Christmas bonus, just for living in Alberta.

Worse yet, B.C. taxpayers are losing ground compared to just five years ago. The 2009-10 B.C. Budget noted the total provincial tax burden for the $60,000 per year family was $5,759, almost a thousand dollars less than it is today. That’s the biggest five-year jump, in real dollars, in the country – an extra $20 bill handed over to the B.C. government, every single week of the year.

Just this year, B.C. taxpayers face Hydro increases, ICBC hikes, a lower basic personal income tax exemption, CPP and EI hikes, BC Ferries fare increases, another Medical Services Premium tax increase, and property tax hikes.

And now TransLink Mayors want us to add another $250 million to our annual tax burden. With fewer than 1 million households in the Lower Mainland, that’s a tax increase – visible and hidden – of $258 per household.

 

WHY SALES TAXES ARE BAD

These tax increases are no surprise to the TransLink apologists. The B.C. Chamber of Commerce offers an elegant case against sales taxes in their own policy manual – a policy they are now violating by supporting this TransLink tax hike.

The Chamber points out that the Provincial Sales Tax, on which TransLink’s tax is modeled, hurts B.C.’s ability to attract investment and new economic activity. The Chamber notes, “It is critical that attention is paid to any tax changes that will negatively impact B.C.’s exporters’ ability to compete in other markets. The PST is a significant impediment in this regard” (p. 104). It adds that the PST (and, by extension, the TransLink tax) “embeds cost at every stage of production” (p. 104).

This adds strength to the No TransLink Tax campaign argument that this tax will be passed down to consumers through higher prices.

Further, the Chamber policy manual argues that small business is most affected by sales taxes. “One of B.C.’s largest productivity challenges is the difficulty small businesses face in accessing capital to invest in innovation or productivity enhancements. [The PST has] a disproportionate impact on these small business compared to larger firms in terms of addressing productivity” (p. 105).

In essence, small business will be punished again by a new TransLink tax, damaging their productivity in order to transfer billions of dollars to TransLink, a wasteful government agency.

Finally, it is B.C. Chamber of Commerce policy to “find ways to reduce the administrative burden of the PST” (p. 106).

This new tax requires the creation of a separate collection bureaucracy, new rules, new forms, new audits, and new remittance procedures. Point of sale terminals and accounting procedures will need to be upgraded at the cost of thousands of dollars each. It is unclear what items will or will not be taxed, and whether purchasers from beyond the Lower Mainland will be taxed. Instead of following its own policy manual, the Chamber is endorsing a massive increase in red tape.

The TransLink tax will especially hurt lower income individuals and households. With no rebate for the poor, this is considered a “regressive” tax. Many items are taxed with PST, and are therefore very likely be taxed by TransLink:

  • cleaning products
  • laundry soap
  • furniture
  • towels
  • sheets
  • blankets
  • tools
  • adult clothing
  • adult footwear
  • diapers
  • belts
  • umbrellas
  • liquor
  • cable TV
  • cell phones
  • Internet access
  • long distance phone calls
  • vehicle leases
  • all car sales (new and used)
  • oil changes
  • car repairs
  • tires
  • cosmetics
  • hair care supplies
  • toothpaste
  • toothbrushes
  • razors
  • deodorant
  • nail polish
  • sunscreen
  • musical instruments
  • sports equipment
  • TVs
  • cameras
  • MP3 players
  • computers
  • legal services
  • and many, many other goods and services.

Many of the items on this list are necessities, which both rich and poor need to purchase. This new TransLink tax will makes all of these items, along with many others, more expensive.

The TransLink sales tax will also reinforce and promote the established behavior of Lower Mainland taxpayers heading south and east to save money.

While TransLink Mayors claim the 0.5% sales tax won’t incent people to shop elsewhere, they ignore the fact that the 17 cent per litre TransLink gas tax is already causing this phenomenon. Now those gasoline purchasers will have a reason to stop and shop.

Mission and Abbotsford have become a mini version of the United States. Consider massive savings in gas purchases, added to the savings on groceries, milk, cheese, flights, and consumer goods, and it’s no wonder why Whatcom County is seeing its highest number of Canadian visitors since the mid-1990s.

 

WHAT ABOUT OTHER PRIORITIES?

The TransLink Mayors’ push to allocate federal and provincial grant dollars to TransLink is also a concern, as it will likely reduce the partnership money available for local government to tackle other issues, such as water and sewer. Further, it could slow investment in other government priorities, such as health care and education.

Interestingly, it was a TransLink board chair who raised that possibility. In the March 2013 edition of Policy Options magazine, TransLink chair Nancy Olewiler wrote a piece called, “Think twice about all that spending on transportation.”

“A society of slow growth may be the tipping point for transportation,” wrote Olewiler, whose argument applied to roads, bridges and massive transit projects. “Slower growth may change the assumptions that go into our projections for new transportation capacity. That possibility is something for planners to think about before they take long-term decisions to pump billions of dollars into infrastructure spending, at the expense of investments in health or education, which we will need to improve our quality of life.”

Olewiler’s piece was stunning because it was the first time a TransLink official has admitted that taking taxes for TransLink means less for priorities such as health, education, emergency services, water, sewer or others. Taxpayers cannot afford everything.

 

THE PATTULLO TOLL BRIDGE: MAYORS’ ATTEMPT TO HOODWINK DRIVERS

The Pattullo Toll Bridge is included in the TransLink Mayors’ wishlist for only one reason: to give a high-profile reason for drivers to vote for their TransLink sales tax. As a toll bridge, the Pattullo could, and would, go forward no matter the outcome of the plebiscite.

As TransLink executive vice president of strategic planning Bob Paddon told Black Press in October: “Regardless of the outcome of the referendum, we need to get this finished. This is a tolled facility that generates its own revenue, so it can go on its own merits.” Amusingly, Paddon backtracked afterward, claiming an initial $90 million a year funding gap would have to be addressed before tolls kicked in. However, given the province’s stated commitment to contribute one-third of the bridge replacement cost, that initial investment is more than covered.

There is no reason to include the Pattullo Toll Bridge in this plebiscite, except for TransLink supporters to deflect criticism from drivers. The Pattullo is a safety issue - replacing a 76-year-old bridge that may not stand up to an earthquake shouldn't be a way to troll for a few votes to fund a fancy subway in Vancouver.

 

SURREY HAS A ‘PLAN B’ FOR LIGHT RAIL

Not only is there already a Plan B for the Pattullo Toll Bridge in the case of a No vote, the Mayor of Surrey has also indicated her own plan to go ahead with light rail in her city.

“I know what my Plan A is, and I know what my Plan B is,” Hepner told the media. “I’m going to have that Plan B ready to go off the shelf if [the plebiscite] doesn’t translate into a yes.”

Hepner has previously noted Surrey would pursue public-private partnerships and development money along light rail lines to pay for construction.

This should come as no surprise. Surrey’s previous mayor, Dianne Watts, wisely skipped TransLink and appealed directly to the federal government for funding for Surrey’s light rail plans. Just before leaving office, Ottawa granted the project “screened in” status, the next step in developing a business plan for light rail and potentially funding it. “This decision to have Surrey’s application for federal funding move on to the next stage is a significant step forward in making a Light Rail Transit system a reality in our city,” Watts said at the time.

So, of the three major infrastructure projects in the plan, two would likely happen (the Pattullo and Surrey light rail), even with a No vote. Vancouver mayor and council have failed to come up with a plan B for their top priority, the Arbutus subway.

 

CUT CONGESTION?

The TransLink Mayors continue to claim this tax will “cut congestion.” Over the coming weeks, the No TransLink Tax campaign will bust that myth.

 

GIVING TRANSLINK A BLANK CHEQUE

Instead of fighting to make TransLink executives responsive to taxpayers’ concerns, or to hold them responsible for the millions and millions they have wasted, the Yes side has become TransLink’s biggest apologists. Their message: just close your eyes, ignore TransLink’s record, and cut them a bigger cheque.

This tax has no sunset clause. Even after the TransLink Mayors’ spending spree is done, we will keep on paying. And it could go up:  As Yes strategist Bill Tieleman told CKNW, future provincial governments could raise the TransLink tax: “Any government can raise taxes if they wish and they have in the past,” Tieleman said. “Governments change taxes all the time.”

That should send a chill down the spine of every hard working taxpayer in the region. Further, TransLink has not properly costed this plan, and given TransLink’s track record of overruns and mismanagement, it seems like a lock that this tax hike won’t be enough to cover it. Bob Paddon, TransLink’s executive vice president of strategic planning, admitted that important detail to 24 Hours Newspaper: “The work (earlier estimates) we did was, again, several years ago. We want to bring it up to 2015 dollar estimates. It’s going to take at least half a year probably for the consultants to be able to complete the work. I just don’t think we’ll have this work completed prior to the conclusion of the referendum.”

Given TransLink’s record on projects like the Compass card and fare gates, it seems like a lock that the price tag for the TransLink Mayors’ wish list will increase. As Bob Mackin reported, the TransLink tender documents say TransLink wants technical services that include cost estimates by late summer that are “+/- 30% cost confidence.” It’s shocking that such a wide window would even be considered.

TransLink will again run short of money, and more taxes – likely road pricing or a sales tax increase – will be pushed on taxpayers.

No matter what, voters deserved to know the full cost of the TransLink Mayors’ wishlist before we vote – but TransLink has again let taxpayers down.

 

CRUNCHING THE NUMBERS

The No TransLink Tax campaign engaged Sacha Peter, a certified management accountant and former elected Cultus Lake Park Board chair, to consider the TransLink Mayors’ wishlist, and explore various funding options.

From his executive summary:

The Mayors’ Council of TransLink has issued a vision that represents an expansion to the 2014 Base Plan document. The expansion plan envisions an incremental $7.5 billion in capital expenditures. The originally proposed new revenue source has now been superseded by the upcoming plebiscite on the Metro Vancouver Congestion Improvement Tax (CIT).

TransLink taxation has historically risen approximately 4.5% compounded annually from 2005‐2014. Municipal revenue collection in the GVRD has also risen by 5.0% for own‐purpose property taxation. The TransLink 2014 Base Plan assumes fare and tax collections will increase by 2.4% per year for 10 years, while the Mayors’ Council Vision, due to the implementation of the CIT, anticipates revenue growth of 4.8% per year for 10 years from 2014 levels.

The upcoming proposed CIT, if using existing PST rules, will collect approximately $240 million in its first year and is estimated to grow in proportion to the Provincial Sales Tax, or about 3.9% per year. Over a 10‐year period, the CIT is projected to collect $2.8 billion in revenues, which will be used to pay capital and operating costs associated with a proposed expansion of the TransLink system.

Mechanisms involving revenue savings can be used to fund the equivalent of the proposed CIT.

Realizing an annual savings of 1.4% on municipal own‐purpose taxation and TransLink taxes for 10 years would result in the equivalent of CIT collections in 2015 present value dollars.

If all Metro Vancouver municipal revenues, including those derived from sales of municipal services (water, sewage, garbage, etc.), and projected TransLink revenues are considered, a 0.59% annual revenue savings would be required to raise funds equivalent to the CIT.

The Pattullo Bridge replacement appears to be self‐financing (including payment of principal and interest of the non‐partnered capital costs) with the assumption of existing traffic patterns and the establishment of a Port Mann Bridge‐style toll. As the Pattullo Bridge replacement is the most significant road network improvement of the Mayors’ Council Vision and also apparently self‐financing, it should be separately considered in context of the overall Transit plan. This would result in a 13% reduction in capital cost requirements of the expansion plan.

 

RECOMMENDATION #1: VOTE NO

Voting NO is the opportunity for taxpayers to push back against TransLink, its record of waste, its lack of fiscal restraint, and its years of mismanagement. A NO vote would send a message that the public has no confidence in the current TransLink administration, board, executive and form. It would force the provincial government and mayors to radically change the current operation and structure.

Voting NO can also send the message that Lower Mainland residents are taxed enough. The Fraser Institute calculates that 42% of the average Canadian family’s income is now spent on taxes, both overt and hidden. Adding another TransLink tax on top of the parking, gasoline, Hydro and property taxes TransLink already collects, will further erode families’ finances. Add in the dozen or so other tax and fee increases that government is bringing in this year, and the wallet gets lighter and lighter.

TransLink tax supporters like to suggest that a NO vote will only send their favored message to government: that somehow the region doesn’t want transportation investment. This is just political spin; politicians are sophisticated enough to understand that there is great concern over TransLink mismanagement, the growing tax burden, and a lack of priorities set out by elected officials.

A NO vote will not cause “Carmageddon,” as some like to suggest. It will force change on TransLink. It will not prevent a Pattullo toll bridge from being built, or the Surrey light rail line from being developed. But it will force politicians at all levels to work together to finally fix TransLink, cut TransLink waste, and find money from within their ever-growing budgets to put into transit.

 

RECOMMENDATION #2: FIX TRANSLINK

As outlined in this report, TransLink is clearly broken. It is run by a secretive board of directors that avoids the public at all costs – and when they do get dragged before taxpayers and riders, misleads us on issues like executive pay freezes.

There is the grossly overpaid executive suite, with individuals who are not held accountable for their waste, their poor management decisions, their lack of leadership, and their mismanagement. Instead, they are rewarded with ever-growing pay packages, bonuses, vehicle allowances and other perquisites.

There is the Mayors’ Council which meekly goes along with TransLInk management, demanding a tax increase from taxpayers while failing to address TransLink’s long list of waste and poor decisions. When in their own city hall, these mayors rarely shy away from using their offices as bully pulpits to lobby senior levels of government, get changes to legislation and programs, and fight for what they perceive is the public good.

Yet, when those same mayors get together to talk TransLink, they weakly suggest that legislation prevents them from holding TransLink accountable. Meanwhile, taxpayers and their advocates, along with whistleblowers and the media, have pushed back relentlessly on TransLink waste and even won legislative changes.

The mayors even hesitate on taking the two TransLink Board of Director seats granted to the mayors’ council. Those seats should go to two mayors willing to be absolute bulldogs for the public good; people willing to fight for taxpayers against waste and poor administration decisions.

The Mayors’ Council could have led the way for taxpayers – demanding TransLink change its wasteful ways before sending a tax increase to the public for a vote. As Derek Corrigan said, “I have steadfastly opposed the governance structure of TransLink and I have made this clear dozens of times. I won't ask people for more money when I have no control over how it will be spent. This is particularly true given the TransLink history of mismanagement.”

Our elected leaders could have pushed back against the provincial government and demanded change on behalf of taxpayers. Instead, the majority decided they would demand more tax money from taxpayers to hand over to TransLink.

 

RECOMMENDATION #3: PRIORITIZE THE WISHLIST

Leadership is about priorities. As Mayor Derek Corrigan points out, the TransLink Mayors’ document is a wishlist, not a plan. It’s a political document designed to throw as much at the wall as possible in a cynical effort to get a YES vote. The inclusion of the Pattullo Toll Bridge is the biggest example, but none of these commitments are set in stone.

Federal and provincial contributions have yet to be negotiated, business plans have yet to be written or proven out, bus routes have to be analyzed and prioritized, the two largest projects don’t have accurate, up-to-date costs (and won’t until after the vote on the tax), and no order for the projects is laid out. The TransLink tax itself is nebulous and devoid of any rules, procedures, items lists, or other elements which taxpayers deserve to know before they vote.

The region needs to be led by politicians who can make priorities. There is a reason we built one rapid transit line per decade (the Expo line in the 1980s, Millennium in the 1990s, Canada in the 2000s and Evergreen in the 2010s): they are incredibly expensive, and the Lower Mainland is still a reasonably small tax base. We can’t afford to do more than one at a time, and we have to give the opportunity for the tax base to recover from these major expenditures, or taxpayer-funded agencies risk drowning in debt. We have to find cheaper ways of delivering this service, eliminate wasteful spending and incorrect priorities, reallocate current tax sources, and find alternative ways to fund items.

 

RECOMMENDATION #4: REALLOCATE 0.5% OF PROJECTED GROWTH IN LOCAL GOVERNMENT REVENUES TO FUND NEW TRANSLINK PROJECTS

Local government revenue in the Lower Mainland has been growing far faster than any other level of government. As Table 6 (p. 22) in the Revenue Analysis of Metro Vancouver Municipalities, TransLink, and the Congestion Improvement Tax independent review shows, Metro Vancouver and the 21 GVRD-area municipalities have seen their combined revenue grow an average of 5.7% every year since 2005. Table 7 (p. 22) shows the Vancouver annual inflation rate during that time was 1.5%, meaning municipal revenue grew nearly four times faster than inflation. Table 8 (p. 22) goes even further, showing local government revenue grew twice as fast as provincial government revenue, and two-and-a-half times faster than the federal government. These radically different revenue growth rates are illustrated in Figure 4 (p. 23).

For those looking for an alternative way to fund transportation projects, this rapid growth is key. The TransLink Mayors could have generated the same amount of money as they plan to take from taxpayers through the TransLink sales tax by simply earmarking 0.5% of local governments’ revenue growth to TransLink. Instead of growing at an average of 4.8% per year, as conservatively projected in this analysis, total local government revenue (TransLink, Metro Vancouver and the 21 member municipalities) would grow at average 4.3% per year, with the remaining 0.5% allocated to transportation projects.

The Pattullo Toll Bridge would be removed from the plan. As outlined above, it will proceed with or without approval through this plebiscite.

As Table 32 (p. 49) shows, the remainder of the plan could be funded with a 0.49% reallocation of the annual growth in local government revenues. This could be further reduced if the plan was stretched out over 12 or 15 years, or if TransLink Mayors aggressively pushed TransLink to stop wasting so much money.

This is new money, and would not involve cuts to current services. This is revenue from growth coming to the region over the next ten years, and taxpayers would simply be asking councils to make due with a 4.3% annual growth rate in their municipal treasuries, rather than a 4.8% growth rate. That 4.3% annual growth rate would still be far higher than the provincial or federal government growth rates.

This would not solve the systemic waste issues with TransLink. TransLink Mayors should push hard for better executives and managers, more accountable governance, and an end to TransLink’s penchant for wasting tax dollars. However, if the TransLink Mayors truly are comfortable enough with the way TransLink is run to pour $250 million more per year into it, than allocating future growth, rather than raising sales taxes, would be the preferable option.

In short, voting NO to the TransLink sales tax merely pushes TransLink Mayors to find other options – such as reallocating a small portion of revenue generated by growth in the region.

We can stop the tax hike Pledge to vote NO in the TransLink Tax Referendum this spring

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