When financial numbers involve billions, many of us struggle to gain understanding and perspective. Usually, the beneficiaries of large scale spending are the worst sources of information. Here’s an example.
A “fact-check” statement from the paid-for-by-taxpayers Mayors council website says:
A “Yes” to Transit vote would cost average households $125 a year.
Readers are invited to click on a link to view “the math” and that brings up a PDF file that states:
The Mayors’ 10-year plan to improve transit and transportation as the region grows by one million more people will cost the average household $125 a year. That’s about 35 cents a day.
You don’t have to be a mathematician to know an average is calculated by dividing a sum by the count of numbers contributing to that sum. Transit referendum proponents claim the 0.5% tax will raise a sum of $250 million and they admit the count of households in Metro Vancouver is 967,948. Those numbers produce an average of $258.28 in new tax collected for each household.
TransLink proposes to spend $7.5 billion to expand its asset base. Financing that amount at 4.45%, the effective rate it paid to the Municipal Finance Authority according to TransLink’s most recent annual report, would require annual payments for 20 years of $568 million.
That results in an average burden of $587 per household, almost five times the amount suggested by the Mayors Council.
The tax proponent’s website also states:
The Mayors’ 10-year plan to improve transit and transportation as the region grows by one million more people…
The implication intended is dishonest. If Metro Vancouver grows by 1.24%, the annual percentage forecast by Stats BC, population will grow by 310,000 in ten years, not by one million they want you to believe.
However, there is more important set of facts ignored by the Mayors Council and their army of public relations operatives. Substantial capital expenditures result in additional operating costs and when those are not covered by transit fares, there is an additional burden placed on taxpayers. These reported numbers are taken from the 2013 annual report, the projected numbers I calculate:
It is egregiously wrong to pretend that a yes vote on this transit referendum will affect families by only $125 a year. It could be ten times that amount.
Personally, I’m not against improving transit but there are fundamental questions that we must ask and they are not part of the conversation that most municipal politicians and plutocrats want to hold.
TransLink management, I’ve said repeatedly, is a too comfortable place for too comfortable people. They claim to serve the less privileged people of British Columbia but those customers are often the ones at or below British Columbia’s individual median income of about $30,000 a year (Statistics Canada. Table 111-0008). We need to ask if we should pay executive salaries a dozen times greater than what half the system users earn and we need to rethink the levels paid for many other TransLink positions that result in 6-figure salaries.
However, restraint and moderation is not going to happen when people who’ve grown fat at the public trough are making decisions. There is a very small clique that chooses TransLink directors and they cast eyes over very few candidates, none from groups that typically use transit. That governance structure is the first change needed. Without substantial movement down the road of reform, I’m not prepared to vote yes to a regional sales tax.