Due to the COVID-19 pandemic, TransLink's fare revenue crashed, but thanks to the financial support of both the federal and provincial governments, the agency could maintain transit service. While ridership is growing rapidly now, there are still some significant budget challenges.
TransLink's revenue is lower today than what we predicted it would be before the pandemic. It didn't account for the rising cost of almost everything due to inflation and geopolitical instability. The adoption of electric vehicles is also growing faster than expected. All this has led to a structural funding challenge for TransLink.
TransLink fare revenue is lower because people take transit differently. There are fewer 9-5 commuters and more weekend riders, which negatively impact revenue. Also, the Mayors' Council and the province froze fares and capped fare increases since the pandemic to maintain affordability. These actions and the change in ridership mix have led to a significant loss in revenue.
Fuel tax is also declining faster than expected as more people are buying more EVs faster than was predicted.
On the positive side, property tax revenue has been stable.
As revenue has declined, the cost to provide the same level of service has increased, which is a double whammy. We've all suffered from inflation, and TransLink is no different. Besides inflation, traffic congestion also impacts expenses. To maintain the same level of bus service, TransLink must operate more buses due to congestion. Congestion costs more than the planned expansion of bus service!
The following scary graph from today's Mayors' Council meeting agenda shows the funding challenges that TransLink faces today.
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| Graph of 2026-2033 increase in structural funding gap by drivers. Select the graph to enlarge. |
On the positive front, the province has provided funding to fill the gap up to 2026, and they should be commended for this. This funding will give us time to get TransLink's financial house in order.
The Mayors' Council (on which I serve) and TransLink Board are working hard to solve the funding challenges with TransLink to ensure that we can continue to grow our transit system and maintain our regional road network.
Even today, TransLink continues to work with municipalities to speed up bus service to save money. These cost savings are why we have bus lanes in Langley City.
Together with the feds and the province, we will be able to balance TransLink's budget and provide a stable path forward. The alternative is massive cuts to transit service, which will increase congestion and increase the cost of living for people in Metro Vancouver.
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