Last week, the National Post reported on a study—from the Netherlands of all places—saying that Vancouver’s traffic is the worst in Canada.
Vancouver is also the second most congested city out of 26 major centres in North America. News items like this are becoming more and more common. Last year, an article by Andrew Coyne appeared in Maclean’s magazine about the traffic woes in Canada’s cities, and how tolls could help finance new road infrastructure, end traffic congestion, and level the commuting playing field by making transit a more attractive alternative.
According to Coyne, Statistics Canada calculated in 2005 that the average Canadian spends 63 minutes per day commuting. That’s almost seven weeks of working time—spent in traffic. The cost to the economy? Almost $7 billion annually according to Transport Canada. And, that’s a conservative estimate, writes Coyne, who then points to a 2011 Toronto Board of Trade report that ranked Toronto’s traffic as the worst of some 20 major European and North American cities. Montreal was the second worst. Vancouver, Calgary, and Halifax also rated in the bottom half.
According to Coyne, “Traffic is slowly strangling our cities. It’s time wasted in traffic that could have been put to more productive use.” He goes on to say that telecommuting, staggered work hours, car-pooling, high-occupancy (HOV) lanes, synchronized traffic lights, and roundabouts, have not worked.
People like working downtown, they like living in the suburbs, they like working at the same time as their colleagues, and they like the convenience of driving. Build more roads? Why? Traffic just expands to fill it. Public transit offers little relief because many see it as inconvenient. Coyne goes on to make the case for road tolling as the only real, effective, and practical solution.
I can’t say how refreshing it was to hear that from the mainstream media. I agree with a lot of what Coyne says. But I do disagree with one thing about the article—the title. Our Rush Hours Rank with the World’s Worst: Andrew Coyne has the Solution. Coyne is far from the first to propose tolls, and the solution certainly doesn’t originate with him. But, I quibble.
Behind the Toll
The reasoning behind tolls is simple. When people are required to pay directly and personally for what they consume or use, the greatest benefit accrues to the greatest number of people. Assuming that no intolerable inequities are produced, user pay is fair, effective, efficient, and environmentally sustainable.
How does this all work when it comes to the private automobile?
When it comes to high traffic loads, the amount of road available to each driver is limited. In other words, the amount of road is “scarce.” People want more “road” than what is available. Now, there are only two ways to ration—hand out—amounts of a scarce resource. First, you can charge a price. Those who pay the price get to use. The second approach is to provide a little bit of the resource to everybody without charging. Everybody gets a tiny bit of the “scarce” resource, and you have to wait in line for that share, or for a larger share if and when it becomes available. With the second approach, everybody gets a small part of the road, but when there is not enough to go around, you have to wait to use your share. We have words for this—congestion, rush hour, gridlock, traffic jam. Just euphemisms for waiting.
Coyne is bang on when he says that high demand roadways will be allocated one way or another—ether by prices (tolls) or by waiting (time) in the inevitable traffic jam.
The tolling of roads has a long history, and their use is becoming more frequent across Europe, the US, Australia, and southeast Asia. Yet, many Canadians remain generally skeptical and suspicious.
I had to laugh at part of a recent CBC piece on Canada’s infrastructure entitled The Big Fix. One of the headlines read “Canadians willing to pay road tolls, poll suggests.” Not true. While the poll showed 50% willing to pay tolls, 43% were against, and 7% were not sure. Canadians are not willing to pay tolls. Canadians are split on tolls.
Opposing the Opposition
In my conversations with people about tolling, the argument usually rolls out in several rounds.
Round One: I open things up. “Tolls would solve a lot of congestion problems and help move people into transit.” What I get back is “The roads have always been free!” I say “Not so. Nothing is free. If you get something you haven’t paid for, it’s just been paid for by someone else. In the case of roads, they were paid for by society through taxes. But, they aren’t free. They cost billions to build and maintain.” What I get back then is “Well, I’ve paid my taxes and shouldn’t have to pay again through tolls.” (End of round one.)
Round Two: I say “Well, we don’t have enough roads and the ones we do have are in bad shape. So either we all have to pay more taxes, or pay tolls. I’d rather pay a toll than a tax. But, let’s leave the building of the roads alone for a minute. Let’s assume that taxes can take care of that. What about the other costs?” At that point, I usually hear “What other costs?” To which I respond, “The costs to society and the environment.” (End of round two.)
Round Three: I open. “Every time you get on the road, you impose a cost to the environment in the form of emissions. And, every time you get on the road—especially during heavy traffic—you impose a cost on other drivers. You are taking up precious road space from the driver behind you without paying for doing that to him or her. And, the person behind you is doing the very same thing to the person behind him or her. On and on it goes. The taxes you pay may have helped build the road, but they do not cover the costs of you using the road. And, those costs will be paid. Either by waiting in line, or by paying a toll. It’s your choice.” (End of round three.)
Round Four: Then, I usually hear this: “Okay. But, no one likes running through toll booths.” I sweep that one aside. “That’s old school. Today, tolling can be done digitally through electronic toll collection and transponders. No booths and no stopping.” Then comes the desperation move. “But it would be hard on the poor.” “Oh, I don’t know about that,” I respond. “Most tollways have another untolled road nearby that people can use if they want, and public transit is also available. And, most poor people don’t own cars anyway. And, tolls can go up and down at certain times of the day. People who want or need to save money can change when they drive.” (End of round, and match.)
At that point, the discussion usually ends. I’ve either won someone over, or they admit defeat but refuse to concede the point.
Canada and Tolls
The Canadian experience with tolls is mixed. Highway 407 in Toronto and Confederation Bridge are two of the more familiar pieces of tolled roadway in Canada. There’s been a lot of debate about the 407. Most of that, however, had to do with the leasing of the road to a private consortium, and the terms under which that was done, rather than the tolls themselves. The tolls on Confederation bridge are quite steep—starting at about $45 and going up from there depending on the size of vehicle—but one hears few complaints. All of that would seem to indicate a measure of support for tolling as a way to move forward.
But, there have also been some big disappointments. Canada’s first tollroad of recent times was the Coquihalla Highway running from Kamloops to Hope, BC. Completed in 1986, the toll was $10 per car and up to $50 for heavy vehicles. There were some complaints in the early days, but people soon got used to the tolls, and things were running smoothly. Then, the province removed the tolls in 2008, saying that the road cost $848 million to build, and as of 2008, $845 million in tolls were collected. The road was now paid, and the tolls could come off.
Nonsense.
That road is far from paid. In fact, it is a huge future liability for the province. It costs millions annually to clear the road from snow, millions to maintain the road by sealing cracks and potholes, and it will cost billions to eventually rehabilitate it or even replace it when it is worn out.
Tim Beauchamp from the Public Sector Accounting Board (PSAB) of the Canadian Institute of Chartered Accountants (CICA) says that “Infrastructure is the gift that keeps on taking.” Tim’s right.
In making this decision, the province of BC has pushed the Coquihalla Highway back onto the tax base. This is the direct reverse direction of innovative financing for infrastructure.
Another big disappointment was the Moncton-Fredericton Highway in New Brunswick. In the late 1990s, the McKenna government announced it would be building a new highway between the two cities, and would toll it. In anticipation of that, a small existing section was tolled starting in 1998 to build up funds. When the government changed hands, the tolls were scrapped in 1999.
Politicians usually have a keen sense for what people want and don’t want. They know that tolls are not popular. But, that opposition also flies in the face of a lot of logic.
Breaking it Down
When first learning to drive, you go to a driving school. You pay for that yourself. Then you need to take a road test. You pay the fee yourself. If you pass the road test, you need a driver’s license. You pay the charge for that yourself. Now that you’re licensed, you decide to get a car. You buy and pay for that yourself.
But things don’t end there. You need license plates. You pay for that yourself. You need to register the vehicle. You pay for that yourself. You need insurance. Guess what? You pay for that yourself.
Now, you’re ready to drive. You must pay for gas yourself. You must pay for oil yourself. You must pay for parking yourself. You must pay for oil changes, tires, and repairs—yourself. If you want to wash the car, you pay yourself. If you get a ticket, you must pay the fine yourself.
The simple fact is, you pay all of the costs for a private automobile yourself. Yet, for some reason, the roads have to be provided free of charge? Why? Both conceptually and philosophically, this position is illogical and irrational.
If Canadians could only see their way around this, a lot of problems would be solved. Highway 63 connecting Edmonton to Fort McMurray is a sad and tragic example. Highway 63 is known as “The Highway of Death.” There have been 46 fatal accidents on the roadway in the past five years, and 125 since 1990. There have been calls for twinning the highway for decades, and while the province committed to full twinning in 2006, completion is still three years away.
The Better Option?
What about tolling? I remember speaking at an infrastructure event in Edmonton sponsored by the Van Horne Institute a few years back. I argued in favour of tolling as a financing and funding tool. Former Alberta Premier Peter Lougheed was in attendance and heard my comments. At lunch, he delivered the keynote speech. His remarks about highway 63 still ring in my ears.
“I’d toll it,” said Lougheed. “And, the tolls would be steep.”
Why a comment like that? Because the road is a prime candidate. It’s the major route to the Alberta oil sands, one of Canada’s largest and most impressive natural resources, and the site of billions of dollars of investment and industrial activity, and production and profit. Given the business aspect, tolls make a lot of sense.
Back to the Netherlands for a minute.
The Netherlands has typically paid for its roads through a complex web of user pay taxes and fees—fuel taxes, fuel surcharges, environmental fees, levies on insurance, special car sales taxes, car registration fees etc. A few years back, the Dutch were seriously considering doing away with all of those taxes. Instead, a meter would be put in every single vehicle in the country. People would pay for using the roads based on what they were driving, where they were driving from, where they were driving to, and when they were driving. A totally user pay system for roads.
That kind of move would amount to nothing short of a stunning sea of change in how transportation is financed and funded. Similar experiments have been underway in England and the State of Oregon. The world continues to move along, folks. When it comes tolls—and our general perception about and support for them—Canadians have a lot of catching up to do. After all, the CBC says that about 45% of Canadians oppose tolls.
I’m glad that’s off my chest. Sorry for the length of this posting, but I’ve wanted to rant on this for a while.
Stay tuned for next week. Simon Farbrother, the City Manager of Edmonton, is going to tell us all about how the City is making millions off its garbage.
By: Casey Vander Ploeg, Senior Policy Analyst