For the provincial government, Metro is their lucrative cash cow – and they’ve been creaming off the dramatic uplift of real-estate values, most recently with the 15 percent tax on foreign buyers but more lucratively with the Property Transfer Tax.  It’s what balances their budgets.

Expectations are now high that the Province will imminently release a report that makes it clear that they want to grab the uplift from development around transit stations to fund expansion of the system – at a direct cost to the municipalities of money that would otherwise go for community amenities that mitigate the impacts of such growth.

 Charlie Smith at the Georgia Straight predicted as much in this May commentary, worth reprinting now:


Here’s what’s really going on between the B.C. Liberal government and TransLink’s Mayors’ Council

This morning, the B.C. Liberal government announced $246 million over three years to fund better bus and SeaBus service, more SkyTrain cars, and “initial work towards new major rapid transit in Vancouver and Surrey”.

The minister responsible for TransLink, former public-relations and advertising executive Peter Fassbender, added a positive twist, saying this investment could lead to construction of more affordable housing.

“Recognizing that public-transit investment results in increased property values near transit stations, the government wants to explore ways to ensure the public receives a benefit from land development in those areas,” the news release stated.

The public already gets a benefit. Traditionally, municipal governments have leveraged higher densities for more community-amenity contributions from developers. This funds community centres, libraries, parks, daycares, and other local services, as well as, on occasion, affordable housing in some cities.

Fassbender wants the benefits of higher density going straight into capital funding for transit and affordable housing, which are both largely outside the ambit of municipal governments.

In fact, transit capital funding and affordable housing more properly belong in the provincial arena, where the government has access to income taxes and other revenue sources unavailable to local politicians.

What we’re seeing in Fassbender’s announcement is a cash grab from municipalities.
It’s disguised as an act of benevolence tied to a $246-million transit announcement. And it’s what we should expect from a former ad man who can spin as well as any politician in Canada.

It comes on the heels of the federal government offering $370 million for public transit in the Lower Mainland over the next three years.

TransLink’s Mayor’s Council wants the province to help fund it’s 10-year transportation plan.

Under the new funding formula, TransLink will get the federal and provincial funding if it can come up with $124 million. But this requires mayors to give up the benefits that their communities receive from allowing higher densities.

That, in turn, will lead to higher property taxes to pay for additional community centres, parks, and other facilities needed by far more people living around transit stations. It’s not a pleasant prospect if you’re a mayor seeking re-election.

The biggest losers might be Surrey and Vancouver where new rapid transit is on the drawing board and where there continues to be massive development around existing stations.

Fassbender’s announcement could also have an impact on Coquitlam and Port Moody, where the Evergreen Line is being built. Burnaby is also in the cross-hairs, given its plan for massive development around Gilmore Station and Brentwood Station.

The province wants higher densities around stations to fund rapid transit.

It’s not surprising that the Mayors’ Council replied by reiterating its support for other ways of funding transit to achieve the goals of its 10-year plan. Policy wonks can read the details here.

Fassbender won his seat in Surrey-Fleetwood by only 265 votes in 2013. And he could be out of a job next May if he doesn’t do something dramatic to show that he’s trying to get light rail to his city.

The projected cost is $2.1 billion for three lines going from Surrey Centre to Guildford, Newton, and Langley City. The price tag vastly exceeds what’s been offered so far by senior levels of government.

The City of Surrey is going to want the transit funding, but it has its own beef with the province over the lack of capital funding for new schools.

So far, the mayors have remained remarkably united. That’s because they know that the federal and provincial governments are doing nothing to help them with the operating costs of running a transit system.

In the meantime, the union representing bus and SeaBus operators remains without a contract and has a strike mandate from its members.

There’s barely enough money to run the existing system under the current collective agreements.

What use will there be in more buses if there’s no funding to pay new drivers’ wages?
The root of the problem has been the B.C. Liberal party’s insistence that there must be a referendum before any new revenue sources can be plucked for transit improvements.
This was part of the party’s platform, which aimed for a debt-free British Columbia.

But there was no equivalent promise to hold a referendum for the premier’s planned $3-billion bridge across the Fraser River. There’s been no talk of funding transit from windfall profits that this project will create for real-estate developers.

Fassbender is probably the B.C. Liberal government’s most masterful spin doctor. But even he is going to have trouble explaining this away.