Commentary

Bus-Fare Increase: A Lose-Lose-Lose Proposition

Increasing bus fares goes against Hamilton's efforts to address poverty, reduce pollution, and ameliorate gridlock.

By Roy Adams
Published February 26, 2007

A bus fare increase is back on Hamilton's budget agenda. In 2006 a fare increase was proposed as an option by city staff but, after a significant outcry, it was abandoned.

Because of last year's outburst of indignation, the first draft city budget for this year called for no increase. But a fare increase has now been placed back in play and, unless a reaction at least as negative as last year's happens again, it may well go through.

Unfortunately, Hamilton is between a rock and a hard place. The cost of the transit system has gone up and the cost must be paid for. Since Hamiltonians are already relatively overtaxed councillors naturally would prefer not to raise taxes to pay for it.

Last year Council used gas tax money from the province to pay for the system cost increase. But this year there is considerable sentiment to use that money to make system improvements. So where will the money come from?

Staff estimates that a 15 cent increase in bus fares (along with increases to passes, etc.) will bring in enough income to pay the bills. That doesn't seem like much.

Shouldn't those who ride pay the freight or a good part of it? Shouldn't the user pay? Since bus fares have not been increased for three years, doesn't that provide license to raise them this year?

Well, no! Not if we want to be fair to the poor, clean up our dirty air and create a transit system that's likely to attract investors.

Hurting the Poor

At this point the users of the public transit system are disproportionately low income people and so a bus fare increase is, to a large degree, a tax on the poor.

Isn't poverty reduction supposed to be a major Hamilton goal? If so, how can we even contemplate a new tax on the poor?

Further, how can we do that when, as a result of area rating, people in the wealthier parts of the new Hamilton such as Ancaster, Dundas and Flamborough contribute less to public transit (based on the standard that they receive less service) than do those in the old city where lower income people live in greater numbers?

Those who can afford $500,000 houses in Ancaster almost certainly have more discretionary income than do those living in $100,000 homes in the North End. But the transit levy on the two families is about the same. Based on the "user pay" principle, people living outside of what is deemed the HSR's service area pay nothing.

Source: Hamilton Property Tax Calculator. All of "Hamilton" is inside the service area and all of Flamborough outside of it.
Transit Levy for a Home Valued at $180,000 in 2006
Inside HSR Service Area Outside HSR Service Area
Hamilton 151 N/A
Ancaster 31 0
Dundas 37 0
Flamborough N/A 0
Glanbrook 58 0
Stoney Creek 47 0

City staff is reported to be working on a transit subsidy scheme for the poor that may help to address this issue. Even if that happens, however, other problems will remain.

A bus fare increase will drive away riders. Last year staff estimated that a 15 cent increase along with increases to passes would result in a loss of roughly 800,000 rides.

This year's estimate is in the same ballpark. The loss of rides due to fare increases has become nearly as predictable as the rising of the moon.

Also predictable are the effects on the system: fewer riders will produce pressure to reduce service and reduced service will produce fewer riders. We have been on this downward spiral for decades.

More Air Pollution

A fare increase, and the system deterioration it will cause, have implications not only for regular bus riders but for all Hamiltonians. Those who abandon the bus will have to get around some way and many will turn to cars, probably old cars.

That will mean an increase in an already serious air pollution problem in Hamilton. Health Canada estimates that several hundred Hamiltonians die prematurely due to the effects of air pollution.

Indeed, Hamilton seems to have one of Canada's worst air pollution problems. In a study published in 2004, Health Canada estimated that there were nearly 10 deaths due to air pollution per 1000 Hamiltonians (population in 1998-2000 = 467,799; estimated excess deaths due to air pollution = 460). The rates were about 5 per 1000 in Toronto, 6 in Montreal and 7 in Windsor.

Don't numbers like these demand that we, at least, do nothing to make the situation worse?

More Gridlock

A fare increase will also produce more gridlock, making it more difficult to get around town and that has to negatively impact our efforts to attract sorely needed new investment.

According to the Canadian Chamber of Commerce, "access to roads and public transit are key factors" in business location and expansion decisions.

City planners estimate that gridlock is already costing the Greater Golden Horseshoe Area billions of dollars in lost productivity (see: Marni Cappe "Breaking Gridlock, Lessons form London's Success Story," Policy Options, February 2004).

How are we to attract significant new investment if investors can't count on their employees getting to work on time and have to figure in the higher costs of getting their goods through an increasingly dense sea of metal?

Our provincial government has begun to realize the need – the social need, the economic need, the health need – for an efficient and affordable public transit system. That's why it came up with the gas tax transfer plan. An explicit goal is to increase public transit ridership.

Reaching Hamilton's Goals

Isn't Queens Park going to be disgruntled with Hamilton Council taking a contrary decision? And shouldn't we be a little more than mildly concerned about that since we have appealed again this year for another ad hoc provincial government transfer to cover our annual social service deficit of roughly $20 million?

Not only is increasing ridership the goal of the provincial government, getting people out of cars and onto public transit has been an explicit goal of Vision 2020, which is supposed to be official Hamilton policy, for several years. It is also a goal of the recently released master transit plan.

In short, a fare increase and the predictable loss of riders it will produce is directly contrary to Hamilton's official public policy.

A recent survey indicated that most Canadians (and no doubt most Hamiltonians too) realize that global warming/climate change is now our number one issue. Agreement is almost unanimous that public transit is part of the answer to that problem.

In this climate (pun intended), to take a decision that is all but certain to result in further deterioration of the system is simply perverse.

There is no painless way to finance a revitalized and expanded public transit system. Because of amalgamation and the tax complexities it has created, however the increasing cost of transit is financed, some people will be upset.

The downside of fare increases is so steep that, as difficult as it might be, we've got to swear off them: make them taboo, off limits, no option. Public transit is not simply a convenience for those who use it.

It is a public utility critical to the welfare of the community as a whole. We need leaders courageous enough to take that message back to their constituents. We must have a plan that will increase ridership, not decrease it.

(The author would like to thank Don McLean for his comments on an earlier version. The final result is, of course, entirely my doing. - Roy)

Roy J. Adams, McMaster University Emeritus Professor, is Executive Director of the Hamilton Civic Coalition a group of community leaders dedicated to realizing the city's potential.

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By fowgre (registered) | Posted February 26, 2007 at 14:49:49

I'm both shocked and dismayed to find out that your Council is proposing this backwards step. In fact, I posted about Hamilton's Social Inclusion Policy just 3 days ago as an example of what London should be aspiring to (see: http://frommybottomstep.wordpress.com/20...

Hopefully there will be sufficient public backlash that your elected officials will have the courage to reverse their decision.

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By Brendan (registered) | Posted February 26, 2007 at 21:00:04

I agree with the sentiments Roy, but blocking fare increases, I fear, is the best way to ensure the transit system is never improved. Only about 50% of the costs of running the system is collected from the fare box. The real dollar impact of those missing percentage points on the city's budget increases every time new service is added. So valuable initiatives like the proposed extension to the BeeLine, or a new route to the Keith neighborhood tend not to be pursued because the HSR doesn't have the budget to cover the associated increase in operating costs. How can the city fund transit sustainably, (and without stunting the network's growth) unless you increase fares at least on par with inflation? It's not a rhetorical question. I've been looking for a better answer for months.

(Just for comparison, Ottawa's fares are $3.00/ ride, Toronto's are $2.75, Vancouver's are $2.25. Hamilton hasn't increased it's fares since 2003)

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By Brendan (registered) | Posted February 26, 2007 at 21:04:40

Further to my last comment, If a transit fare increase can fund new routes, ridership might even increase. In that case, your arguments about about pollution, gridlock and climate change become more difficult to make.

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By peter (anonymous) | Posted February 27, 2007 at 10:37:54

we shouldn't compare fares in ottawa, toronto and vancouver to HSR's. we shouldn't compare anything we have or do to those other cities. are there any similarities between hamilton and those other cities? not really. those cities offer really good transit options compared to hamilton. that said, riders also complain a great deal about the cost of public transit. hamilton has a poor population, whether we like to admit it or not, so we need to stick to comparing apples to apples. we can't afford to raise fares. it just doesn't make sense!

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By MattM (registered) | Posted March 05, 2007 at 04:12:35

The way I see it as is such: Toronto fare is $2.75. Ours is $2.10. We have busses. They have streetcars, subways and busses on a much more extensive network. Our fare should come nowhere near theirs until our system is comparable. If it did, what exactly would we be paying for? The subways, streetcars and hundreds of busses we don't have?

In the least I wouldn't be willing to pay extra until a Bus Rapid Transit network is introduced. The current fare should be more than adequate for the current system.

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By electrified! (anonymous) | Posted March 05, 2007 at 09:04:06

Subways are more expensive no matter how you slice it - but they carry a hell of a lot more people than buses. Streetcars are more expensive to set up than buses but cheaper than subways and way cheaper to operate than buses.

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By oreoturtle (anonymous) | Posted May 06, 2007 at 15:17:55

I do agree that a fare increase would not be good because of the high level of lower income citizens in this city.

I see many people are comparing our transit to other cities, however Hamilton will always be unique no matter how you look at it.

I also agree that a fare increase would be beneficial because then many things could be improved upon with our current transit system if the income is there.

This is a great article and definitely one to get people thinking and discussing. Excellent job Roy Adams.

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