Published on
With Montreal’s Greater Metropolitan Area and other major Quebec cities having just announced an increase in vehicle registration taxes, what should we be asking ourselves about the underfunding of public transit, and what do we need to understand about the powers of municipalities? We break it down.
In a nutshell
How is public transit financed? In Quebec, public transit is funded by the provincial government, cities and transit users. In each city with a public transit authority, the tax levied on vehicle registrations also helps to fund the system.
Why is public transit financing such a hot topic? Many cities and transit authorities have been crying out to the Quebec government for help and support from the Ministry of Transport and Sustainable Mobility to fund their operations, but the Ministry has turned a deaf ear to finding long-term, sustainable funding solutions. Through Bill 39, the government granted taxing authority to municipalities, allowing them to raise vehicle registration fees in order to obtain additional funding for their public transit operations—all while simultaneously discouraging them from doing so. It’s clear the 154% increase baked into this tax, as announced for the Montreal Urban Community (MUC) is shocking, but mayors were faced with a difficult dilemma: to cut services or raise taxes to avoid a catastrophe.
Catching up: The increase may seem high, but let's not forget that the vehicle registration tax has not been indexed since 1992. There's a clear problem with long-term planning to ensure that funding matches service levels, and the provincial government has clearly failed in its responsibilities here. In other words, if previous transport ministers had managed the situation properly, we wouldn't be in this mess.
Back to the point: This rate increase is significant, but not graduated, because successive governments have not indexed existing funding sources over the years, leaving an ever-widening gap between revenues and the funding required to provide service. This is a shame. If this increase in vehicle registration fees is imposed by municipalities, it's because the Quebec government has delegated this responsibility to them, to avoid dealing with complaints. But in reality, the funding of public transit is everyone's business.
What we think
We see funding public transit as an investment, not an expense! Public transit is not only essential to the vitality of our society, but also towards a green transition. It means fewer vehicles on the road, meaning less congestion for those who use road networks. It's in everyone's interest to have a strong public transit network - and the same goes for active transportation networks. Public transit also makes it possible to access jobs, housing and essential services. Its users already pay for the use of the service, which is not the case for users of road networks, with the exception of tolls on two bridges in the Greater Montréal area. But that's no mean feat. The funding required for public transit far exceeds the increase in vehicle registration tax, and involves all levels of government.
It’s time to act
The issues surrounding the funding of public transit are complex and require in-depth reflection. That's exactly what we're doing, by supporting projects addressing these issues and making recommendations.
