There are pros and cons to the Liberal plan for $1 transit fares, experts say

The Ontario Liberals' campaign promise of$1 public transit fares to boost ridership and cut costs for commuters is drawing mixed reactions from advocates and analysts, with some contending the money would be better spent on increased and more reliable service.

"I think it's really good in the sense that we're actually having a conversation about transit fares because they are, frankly, a mess in a lot of the province. But I think that this proposal kind of misses the mark," says Reece Martin, a Canadian transportation analyst who hosts a popular YouTube channel with more than 100,000 subscribers.

"What I think [public transit agencies] need is operating subsidies so that they can operate more service," Martin said.

"If you're in Markham or Oakville or a lot of other places across the province not to mention Kingston or North Bay having a $1 fare on the bus is great. But if the bus only comes once an hour or once every twohours, it's still a really inconvenient service to use."

The $1 fares, which the party is calling "buck-a-ride, provincewide," would kick in this year and run until at least the end of 2023. Monthly transit passes would also be capped at $40, the Liberals promised. The party saysthe proposal would cost about $710 million in 2022/2023 and roughly $1.1 billion in 2023/2024, and that the government would replace all lost revenue to transit services.

At a news conference this week, Liberal Leader Steven Del Duca said the fare reduction would take about 400,000 cars off Ontario roads each day and make life more affordable for commuters.

WATCH |Liberal Leader Steven Del Duca on his plan to slash transit fares provincewide:

Ontario Liberals promise to cut all transit fares to $1 until 2024

2 years ago

Duration 10:11

Ontario Liberal Leader Steven Del Duca joins Power & Politics to discuss his public transit promise and how he plans to pay for it.

The proposal was welcomed by some Toronto-area transit riders who spoke to CBC News Monday morning.

"That's amazing," said Jay Sharma outside St Andrew subway station. "Right now, I pay close to $140 [per month]. So that'd be nice."

A Liberal party official saidinternal modelling done in consultation with transit experts suggests the $1 fares could result in a 20 per cent increase in public transit usage across the board in Ontario.

Ridership still way down throughout Ontario

There's no question that a dramatic drop in ridership caused by the COVID-19 pandemic has proven a persistent problem for public transit services.

The Ontario Public Transit Association (OPTA), an industry advocacy group, estimates that on average operators are running at roughly 60 per cent pre-pandemic levels.

That figure varies widely, however. Anne Marie Aikins, spokesperson for Metrolinx, said the GTHA regional transit agency is currently seeing about 35 per cent pre-COVID ridership levels, while operating 55 per cent of its pre-pandemic services.

Because public transit agencies in Ontario rely on farebox revenue for a significant percentage of their operating budgets, and in some cases a majority, lagging ridership threatensfuture viability.

OPTA estimates that for every 10 per cent drop in ridership, transit systems lose, on average across the province, $245 million in revenue. The Toronto Transit Commission (TTC) alone is forecasting a $561 million revenue shortfall in 2022.

That is why commitments for stable operating funding should take priority over across-the-board discounted fares, according to Gideon Forman, a climate change and transportation policy analyst with the David Suzuki Foundation.

"The research generally shows that for people who are comfortably off, middle income or higher, the major issues around transit are convenience, speed, reliability, those sorts of things," he said.

Deep fare reductions for low-income Ontarians, coupled with money for better services on existing transit networks and new projects could be the key to improving ridership to pre-pandemic levels and beyond, Forman said.

Terry Johnson, president of the non-partisan advocacy group Transport Action Canada, called the prospect of $1 fares "an exciting idea" that could encourage some drivers to ditch their cars for public transit, while offering relief to Ontarians hit hard by rising inflation.

Cheaper fares need to be balanced with major investments for the future, he added.

"We have to be doing the triage that's needed post pandemic to encourage riders to return," Johnson said, but without money in the short termfor transit improvements, it will take even longer for networks to recover.

"If service drops off because the funding isn't there, the drop in ridership will likely be longer and it will be harder to rebuild."

Liberals commit $375M annually for transit operating costs

The Liberals have previously committed to a $375-million increase in annual subsidies for the operating costs of municipal transit services.

Shelagh Pizey-Allen, executive director of the Toronto-based advocacy group TTCriders, said it was this element of the Liberals' public transit plan that most caught her attention. She says the commitment is a "good first step" but questions if it would be enough to help transit providers dig out of their pandemic holes.

"We are wondering, is it going to be enough to protect municipal transit from the service cuts that ... may be on the horizon as transit agencies continue to face COVID shortfalls because of lower ridership?" she said.

Until the 1990s, the Ontario government covered 50 per cent of operating costs for public transit agencies. Since 2013, provincial funding has come through transfers from gas-tax revenues.

Both the Ontario NDP and Green Party have committed to reintroduce the 50 per cent operatingcost-sharing model for municipal transit services, which the parties say would allow agencies to cut fares over time.

The Progressive Conservatives have put much of their focus on large transit infrastructure projects, promising $61.6 billion over 10 years as part of the capital spending plan presented in the 2022 pre-election budget last week.

When it comes to transportation-related affordability measures, the PCs have largely targeted drivers by scrapping license renewal fees and pledging to cut the provincial gas tax by 5.3 cents per litre for six months beginning on July 1.

In March, however, the government did drop some local transit fares for riders using the GO Transit network to connect to and from their local systems. The province also increased discounts for youth and post-secondary students.

Premier Doug Ford's government also provided a one-time infusion of $120 million to municipalities with public transit services to make up for lost gas-tax revenue as residents drove less during the COVID-19 pandemic.

That funding came in addition to roughly $2 billion in joint federal and provincial money that went to municipal transit services through the Safe Restart Agreement in 2020.

This year, Ottawa announced a one-time infusion of $750 million to municipalities countrywide, $316 million of which went to Ontario. The province then matched that funding, which was intended for not only public transit but all municipal services.

In the 2022 budget, the province conceded that the funding "may not be sufficient to address municipal transit pressures" and called on the federal government to provide a further influx of money.