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.