Calgary Transit estimates 2022 revenue shortfall down to $64M

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Calgary Transit estimates 2022 revenue shortfall down to $64M
Higher than anticipated ridership has put a dent in Calgary Transit's revenue shortfall this year. As Adam MacVicar reports, there are calls for more sustainable options to fund the service. – Jan 2, 2023

Higher than anticipated ridership on Calgary Transit has reduced the service’s projected revenue shortfall for the year as there are questions over sustainable funding options moving forward.

Originally anticipated to be $89 million back in the spring, Calgary Transit said its most recent estimates have pegged the revenue loss for 2022 at $64 million.

Transit officials said the change is due to ridership on the transit service rebounding to 80 per cent of pre-pandemic levels.

According to Calgary Transit, the shortfall was covered by emergency funding from the provincial and federal governments announced last April; Calgary’s share of that money was $82 million.

Mayor Jyoti Gondek confirmed in December that another request for funding was made to the federal government by municipalities across the country at the Big City Mayors’ Caucus meetings late last year.

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“We were assisted in the past on covering some of the operating costs that we couldn’t manage on our own,” Gondek told reporters on Dec. 15. “We have made that request again as we are still entering into that recovery period. So, we’ll see what the federal government is prepared to do.”

In a statement to Global News, the federal government wouldn’t say whether that emergency funding for transit services will continue in 2023.

However, federal officials pointed to past pandemic funding, increases to the Canada Community-Building Fund and an annual $3 billion permanent transit fund scheduled to begin in 2026.

“Cities, including Calgary, have had a reliable partner in the federal government since the start of the pandemic,” finance ministry press secretary Adrienne Vaupshas said in a statement. “In fact, the federal government has provided over $5 billion in emergency funding since March of 2020 – over and above regular transfers that go to municipalities.”

According to David Cooper with Leading Mobility Consulting, the pandemic’s impact on ridership has many Canadian municipalities looking at sustainable options to help fund transit.

“The longevity of (the emergency funding) is in question,” Cooper told Global News. “When we look at funding sources from other cities, they have other tools at their disposal to pay for the day-to-day operating, which is a conversation cities like Calgary and many others might want to have when it comes to the long-term funding of transit.”

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Cooper pointed to cities like Vancouver, which relies on transfers from provincial health authorities and a portion of the provincial gas tax on top of property taxes and fare revenue to fund transit.

Meanwhile, in Edmonton city council has been exploring several options to help fund transit including levies, a fuel tax, parking fees and a vehicle registration fee.

“We want even more people to take transit,” Ward Nakota Isga Coun. Andrew Knack told Global News. “If we want to accomplish that, there needs to be adequate funding so we can continue to grow and enhance the existing service.”

City of Edmonton administration is expected to report their findings to council early this year.

According to Cooper, the emergency funding represented a fifth of Calgary Transit’s budget last year, and cutting service isn’t a simple solution if that funding was to stop in 2023.

“The challenge is when you cut service and you reduce the attractiveness of service, it has this really downward spiral effect where if you make it less attractive for riders, they’re less likely to come back which then decreases ridership even further,” Cooper said. “It’s a really problematic issue.”

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Later this spring city council is expected to debate an update to a Calgary Transit strategy that would shift the service’s focus to frequency over coverage in an effort to improve reliability.

According to Ward 3 Coun. Jasmine Mian, that improvement to frequency will require more staff and in turn more operating dollars.

Although there is no formal direction from city council to explore those sustainable funding options like their counterparts in Edmonton, Mian said the conversation on transit funding is something that shouldn’t be ignored.

“It’s not really a partisan issue, everyone recognizes that this is something that is good for citizens,” Mian said, “We need to sit around that table with the province, with our federal partners and figure out how to best do that.”

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