Drivers in the Greater Toronto and Hamilton Area are paying about $1-billion more in fees and taxes than the annual cost of construction, maintenance and policing, according to a new study.
The Conference Board of Canada report — paid for by the Canadian Automobile Association South Central Ontario — said Ontario drivers overall are shelling out most of road infrastructure costs, to the tune of more than $7.5-billion a year.
Where the Rubber Meets the Road: How Much Motorists Pay for the Road said Ontario road users driving cars, minivans, SUVs and light pickup trucks are paying 70 to 90 per cent of the costs of the road through fuel taxes, vehicle registration fees and tolls.
The report notes that municipalities that own and maintain a large part of the infrastructure collect a relatively small portion of the revenues.
It said the findings shed new light on the discussion about congestion, which tends to presume that road users are heavily subsidized by taxpayers.
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Teresa Di Felice, with CAA South Central Ontario, told 680News the hope is that governments create specific accounts, so that the money from motorists goes back into funding infrastructure.
“I think most motorists think that the money is already going for that. I don’t think everybody understands always that the money is going into general revenues. As we continue to be asked for more, I think that accounting is really going to be more important,” Di Felice said.
Ontario Premier Kathleen Wynne has said that the province will have to charge new fees to bring in the $2-billion a year that’s needed to upgrade public transit in the Toronto-Hamilton area.
The recommendations from Metrolinx, the transit planning agency, include a hike in the harmonized sales tax, a five-cent-a-litre regional gas tax, a $350-million-a-year business parking levy and $100-million a year in development charges.
Wynne’s argument for new fees doesn’t hold water, said NDP critic Gilles Bisson.
Investments must be made in public transit, but not on the backs of already overburdened workers who can’t afford to pay more, he said.
“To go back, yet again, to citizens and say, here, we want you to pay more taxes or user fees or whatever, is just beyond the pale,” he said. “The public has had enough.”
Particularly since the Liberals are wasting about a billion dollars for cancelling two gas plants ahead of the 2011 election, said Bisson.
“They see this gas plant debacle and they say, ‘And you want to come and tax me after you’ve just done that?’,” he said.
The report, which was initiated and paid for by the Canadian Automobile Association, looked at figures from 2008 to 2010 — the most recent year for which data was available, the Conference Board said.
“Motorists in Ontario meet at least a large portion of the costs that they impose on the road infrastructure — and in major urban areas probably much more than those costs,” the report said.
“If we look at the total cost of driving, including vehicle costs, cost recovery will tend to be closer to 100 per cent.”
One of the major challenges in addressing congestion is determining who should pay the costs of more road infrastructure, Conference Board director Vijay Gill said in a release.
The findings of the report don’t remove policy options like congestion charges, but it does challenge conventional thinking about who pays for road infrastructure, he said.