Click here to view the original article in the Burlington Post/Inside Halton.
ED: The full letter included a number of charts and references to support the arguments below.
As you know, the Ontario government collects 14.7 cents for every litre of gasoline sold in Ontario each fiscal year, (April 1 to March 31). Since 2006, the program has provided municipalities with two cents per litre of provincial gas tax revenues.
Municipalities receiving gas tax funding must use these funds toward their public transit capital and/or operating expenditures, at their own discretion, including upgrading transit infrastructure, increasing accessibility, purchasing transit vehicles, adding more routes and extending hours of service. The funding formula is based on 70 per cent ridership and 30 per cent population.
In 2017-18 the total funding envelope was $357.2 million. For 2018-19 the funding envelope for municipalities with transit systems is $367.5 million. A total of 107 municipalities, (up from 105 last year) will share in this funding. Burlington has seen a $70,184 increase in its share of the gas tax over last year.
Since the majority of the funding formula is tied to ridership (70 per cent), it is important for Burlington Transit to continue growing its ridership. Over the past few years Burlington council has made transit investment a priority. This is critical considering the decrease in ridership of 13.3 per cent that occurred between 2013 and 2015.
In a pre-election promise, the Liberal government committed to increasing funding to 2.5 cents per litre starting in 2019-20. This despite spending $40 million per day more than the government was taking in. To figure out how to pay for this promise, the Wynne government struck a Transit Investment Strategy Advisory Panel. At the time of the June 2018 general election, the previous government had not determined an acceptable funding source for promised increases to municipalities under the gas tax.
The mayor’s analysis of the impact, cited in your article, over the next 10 years is based on a highly speculative extrapolation of a pre-election promise by a former provincial government and is quite frankly misleading.
To understand the local impact of forgoing the increase from 2 cents to 2.5 cents, let’s assume: the number of litres of gas sold in Ontario stays the same in 2019-20; that Burlington Transit ridership remains constant, and the City of Burlington continues to fund the transit system similarly to the previous year.
Based on these assumptions, the difference, without the per litre increase would be $583,188. This is .00035 per cent of the city’s 2019 operating budget of $166 million.
It would be very unwise for a government to base their budget numbers on unfounded promises. In fact, the City of Burlington’s 2019 operating budget did not include the previous Liberal government’s gas tax increase proposed for 2019.
Jane McKenna is the MPP for Burlington.