Quebec officially makes a new upward offer to cities and transport companies, as planned. In Greater Montreal, the government would increase its contribution from 150 to 238 million for 2024. A figure which, however, remains below the 300 million considered by the cities as the threshold to respect in order not to affect the service.
The story so far
October 18
Quebec unveils a first offer which would only absorb 20% of the deficits of transport companies by 2028.
October 24
The cities are asking the government in counter-offer to absorb 75% of the deficit in Greater Montreal. They are demanding 400 million for next year. The Press reports at the same time that the government is preparing to submit a new offer of more than 200 million for next year.
November 2
Quebec officially makes a second offer, increasing its contribution from 150 to 238 million for 2024 in the metropolis, however recalculating the anticipated deficit downwards.
A scenario where the government would extend at least more than 200 million from next year had already been mentioned by The Press previously, but had not yet been officially confirmed by Quebec.
“This offer is all the more generous since our government has already been very present during and following the pandemic,” writes the Minister of Transport, Geneviève Guilbault, in a letter sent Thursday to the Metropolitan Community of Montreal (CMM) and to the Quebec Urban Transport Association (ATUQ).
Mme Guilbault estimates that it will absorb 70% of the deficit of transport companies in Greater Montreal next year. It now puts the deficit at 337.9 million, much less than the 532 million cited by the cities of the metropolis.
PHOTO EDOUARD PLANTE-FRÉCHETTE, LA PRESSE ARCHIVES
Geneviève Guilbault, Minister of Transport
Until now, Quebec was talking about a deficit of around 410 million for Greater Montreal in 2024, taking into account revenues linked to the registration tax as well as future “optimization measures” which would make it possible to saving nearly 14 million.
However, a recent “update” of the budgetary framework of the Regional Metropolitan Transport Authority (ARTM), made on October 31, would have made it possible to review projected revenues and expenses, says the minister. This is what makes it possible to lower the anticipated deficit to 337.9 million, according to the government.
According to this same logic, Mme Guilbault affirms that the deficit for all of Quebec and the ten major transport companies is now 376.4 million for 2024, while until recently it was 448 million. Total government assistance is $265 million, which includes $27 million for regions outside of Montreal. This would therefore also amount to filling 70% of the deficit.
More than “equal parts”
Ultimately, this offer “surpasses the principle of equal sharing of the deficit”, welcomes the minister in her letter. Mme Guilbault speaks in particular of a proposal that is “significant in the current context of public finances” which at the same time takes into account “the ability of Quebecers to pay”.
That said, there remain several pitfalls before reaching an agreement. First, the fact that the two parties do not even agree on the calculation of the deficit risks weighing heavily.
Disagreement remains over the use of the new registration tax in Greater Montreal: municipalities want to use it to develop the network, while the government rather expected it to be used to reduce the deficit .
In October, Minister Geneviève Guilbault’s first offer proposed to absorb only 20% of the deficits of Greater Montreal’s transport companies, with aid of 502.8 million over five years, including 149.5 million in the first year.
The cities of the metropolitan region then proposed that the Legault government assume in the short term 75% of the deficit for the year 2024, estimated at 532 million on the municipal side. In other words, their formal request to the government amounted to 400 million for next year alone.
What future for the service?
Barring a surprise, everything indicates that municipalities will remain hungry. In recent days, the cities of Greater Montreal had argued that aid of less than 300 million for 2024 would lead to numerous service cuts in the metro, which would have to close after 11 p.m., as well as withdrawals of buses from the roads and driver layoffs.
It is unclear at this time whether the cities will submit a new counter-offer or whether they will implement these service cuts. No reaction was yet available from their side on Thursday.
For a while, it seemed certain that cities would not obtain 300 million for 2024. The government had sent different signals to municipal elected officials on this subject in the last few days, according to our information.
Still, time is running out to come to an agreement. On the one hand, municipalities must finalize their budgets in mid-November, on the other hand, the Minister of Finance, Eric Girard, must present his economic update on November 7.
One thing, however, seems certain: the rest of the five-year plan for financing public transportation will most likely only come in the spring, when the government’s annual budget is tabled, in March 2024. Only then that we will have an idea of the level of government assistance in the longer term for all of Quebec.
With the collaboration of Tommy Chouinard, The Press