(Ottawa) The federal government is offering municipalities a one-time injection of $750 million to partially offset the shortfall in public transit revenue during the pandemic.
Posted at 1:46 p.m.
This federal commitment, however, comes with what Finance Minister Chrystia Freeland calls two “reasonable conditions”: provinces will have to match federal funding, and they will have to work with municipalities to accelerate housing supply.
Mme Freeland recognizes that municipalities need financial assistance to manage the financial impact of the pandemic and maintain their transit systems.
Ridership dropped overnight with the onset of the first wave of COVID-19 in March 2020 and remained low during a series of lockdowns and health restrictions. The shortfall in operating revenues has deprived municipalities of the funds needed to operate and maintain their public transportation systems.
During the most recent election campaign last year, the mayors of Canada’s largest cities called for a multi-year funding commitment to help fill these revenue shortfalls, which could persist long after the pandemic.
Late last month, the Federation of Canadian Municipalities (FCM) raised the need for urgent financial support, as the Omicron wave of COVID-19 further strained systems, prolonging the serious problems of traffic and operating revenue.
The Société de transport de Montréal thus posted a “shortfall” of 43 million in December, which will have to be absorbed during 2022 since the STM cannot make deficits.
In Toronto, the operating deficit this year is expected to be $561 million; Vancouver anticipates up to 100 million and Edmonton 53.7 million.
FCM’s Big City Mayors’ Caucus has previously pointed out that insufficient funding could lead to service cuts, rate hikes or property tax increases that could limit the country’s economic recovery.