As city council prepares to debate a four-year budget, researchers from the University of Calgary’s School of Public Policy suggest a long-term financial framework for Calgary Transit should be part of the discussions.
The research, by Wenshuang Yu, Lindsay Tedds and Gillian Petit, examined the impact of the COVID-19 pandemic on Calgary Transit’s revenue due to a sharp decline in ridership.
“As of December 2021, revenue from adult transit passes was about 30 percent of their pre-COVID levels,” Petit told Global News. “So it’s a big decline.”
The research showed that revenue from youth fares, as well as low-income riders, recovered more quickly during the COVID-19 pandemic, which researchers attributed to an increased reliance on public transportation.
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According to Petit, the research suggests Calgary Transit needs to develop a long-term financial framework to address the decline in fare revenue if ridership does not recover in 2023.
Currently, the city’s policy is to fund 50 to 55 percent of Calgary Transit’s costs with fare revenue.
“They can subsidize it by increasing how much property tax they use to pay for the expenses of public transportation, and they can raise fares,” Petit said.
Calgary Transit has proposed a fare increase in the upcoming four-year budget, which could see adults pay four dollars per ride by 2026. Youth rides are also expected to increase from $2.45 to $2.65 over the four-year budget.
The proposed changes to rates would also include monthly passes for adults, which could climb from $112 to $126 over the next four years.
Seniors’ annual passes are expected to increase $19 to $169 in 2026, while monthly youth passes could rise $10 to $92 in the final year of the budget.
“We would caution against increasing fares as our research shows that during the pandemic it was children and concession users who really relied on public transport,” Petit said. “These are probably the groups that a rate increase will hit the hardest.”
The budget also proposes an eight per cent increase in funding for Calgary Transit, which budget documents say will help maintain service levels and improve service frequency.
Willem Klumpenhouwer, a post-doctoral fellow at the University of Toronto’s Transit Analytics Lab, told Global News that frequency and reliability are the two factors that help improve ridership.
“You have to lead with the service, and you have to lead with what you’re going for. You have to make that service attractive, and then the ridership will rise to meet it,” Klumpenhouwer told Global News.
“Sometimes we kind of do the opposite and we try to respond to what we think the ridership is and it becomes a downward spiral.”
Klumpenhouwer noted that increasing the frequency of transportation would require a “significant” increase in operating expenses.
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Ward 9 councilor Gian-Carlo Carra agreed the city needs to increase the frequency of transit services and look at Calgary Transit’s reliance on fare revenue, but added it will be a “difficult conversation” that council “needs to have ” during budget discussions next week.
“The solution to transport in an era of climate change, in an era where we want more people driving more often and not just commuting back and forth once a day, is to run more buses and more trains,” Carra said.
“We’re increasing it a little bit in this budget, but it’s very timid, and if we’re going to achieve the things we’ve talked about, we have to run a lot more – and that means spending more money.”
Carra noted that the budget will be tight, with property tax increases in line with inflation plus population growth.
“I feel like it’s a worst-of-both-worlds type of situation where we raise taxes, and that’s going to piss off the people who don’t want to pay more taxes,” Carra said. “And yet we’re not doing a lot of the good things we’ve talked about, which is going to piss off the people we’ve asked to do good things.”
Calgary Transit officials said they could not comment on the proposed budget until deliberations begin on Nov. 21.
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