City aims to have cost of fare-free transit known in time for municipal election
The chair of Ottawa's transit commission says he expects to have some hard numbers in time for the municipal election showing how much it would cost taxpayers for the city to provide fare-free public transit.
Some councillors and community groups have been advocating to make public transit free to use in the city, but Mayor Jim Watson has been largely resistant to the idea, saying it would mean a significant increase on property taxes.
Speaking on CTV News at 6, Coun. Allan Hubley said he expects free transit to be a major election issue this fall.
"It's certainly going to be a promise by a number of people in the municipal election, we foresee that, so that's why we want to put a price to it," he said. "It's realistic if that's what the citizens of Ottawa want to do, but there's going to be a cost."
Hubley said a city staff would look into just how much a free transit proposal would cost, but he suggested it could range between $500 and $1,000 on a homeowner's tax bill.
"Depending on the value of your house," he said. "It used to be the average in Ottawa was $400,000 for a household. I was told free transit would cost us between $500 and $700, in that range, for that style of household. But if you have a million-dollar house, which a whole lot of people in Ottawa do these days, you're going to double that amount on your property tax."
According to the city's property tax estimator, a residential property owner with an assessment amount of $400,000 in a full transit service zone would pay approximately $745 on their 2021 tax bill to cover transit services.
The OC Transpo budget for 2022 is $695 million, with $166 million in fare revenue based on a ridership estimate of 82 per cent of pre-pandemic levels, though the city has yet to reach that amount so far this year. Ridership fell in early 2022 due to the Omicron variant wave of COVID-19 and in February when the "Freedom Convoy" protest occupied downtown Ottawa. A planned fare increase was also delayed for the first four months of the year, costing an estimated $1.7 million, which the city expects to recoup from the Rideau Transit Group overseeing the LRT.
Hubley said he expects staff to have a report ready in advance of the municipal election on Oct. 24.
"We've asked for them for June. We've asked for an update of the long-range financial plan for OC Transpo so that people will see what making improvements and so on costs," Hubley said. "We want all that available to people in June. We're going to try to do a meeting with the transit commission afterwards where it can be discussed even further."
The cost of operating the transit system is split between fare revenue and property tax revenue, with the fare box meant to cover 55 per cent of the money OC Transpo needs each year. However, with lower ridership due to the pandemic and no significant reductions in service, the city has relied on funding from other levels of government to balance the budget.
Hubley said OC Transpo is looking at turning to the federal government for more help.
"Councillor (Catherine) McKenney and myself had a motion where we were calling on the federal government to pick up the operational cost of OC Transpo because the federal government had announced that was the direction they were going in," he said. "So, we put in a motion where a letter was sent to say, 'Okay, well, let's talk numbers here, so that we can say is this going to pick up the cost of transit that people will then be able to ride free?' That's why both of us supported that motion."
The transit commission's next meeting will be held on Wednesday.