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OUR VIEW: For Whom the Road Tolls?

editor — Mon, 14 Feb 2011 14:49:27 -0800

It’s a simple fact of life – freeways are not free. They cost hundreds of millions of dollars.

With municipalities in BC facing a $10 billion infrastructure deficit, there are serious questions about how to pay for the network of major roads and bridges in Metro Vancouver.

A growing population will place more demand on the road network, and many existing routes are nearing the end of their lifespan and will need either major repairs or replacement.

Renewed investment in public transit is one option that would reduce the growth in demand for road capacity, but transit investments are also very expensive. Higher property taxes is another option, but one that could be politically explosive. This leaves one option remaining – some form of user charges or tolls.

A patchwork system of tolls is already being introduced. The new Golden Ears Bridge linking Langley with Pitt Meadows is tolled. The new Port Mann Bridge will be tolled, as will the new Patullo Bridge. When the Knight St. Bridge and the Massey Tunnel need major repairs or replacement, the new crossings will probably be tolled.

However, no tolls are charged on other major bridges and highways such as the Sea-to-Sky Highway, the Pitt River Bridge, the Alex Fraser Bridge, and both bridges over Burrard Inlet.

What is emerging is a transport system that is profoundly unfair. Motorists from south of the Fraser River will be charged hefty tolls, while those from Coquitlam and the North Shore will drive toll-free. Meanwhile, transit users pay a toll every time they board a bus or SkyTrain.

A system-wide toll would charge the users of all major regional routes. The revenues would be channeled into a single fund to pay for the maintenance, repair and replacement of bridges and highways throughout the network. Across the network the tolls could fluctuate based on daily traffic patterns. The most heavily used routes (and peak demand times) could be priced higher than routes with lower demand.

Efficient goods movement is critical for the economy because time in transport adds to the price of goods without adding extra value. Commercial vehicle only lanes could be priced at premium levels, and many companies would be willing to pay premium tolls if it meant their trucks would spend less time stuck in traffic.

System tolls are already used in many countries, such as Portugal, where an electronic tolling system called the Via Verde (Green Road) covers all the major routes in the country. Congestion charges are tolls applied to traffic entering the more congested downtown areas. Singapore introduced the world’s first congestion pricing scheme in 1975. Now congestion charges are widespread, with well-known examples in Bergen, Stockholm, Shanghai and London.

The one-off approach to tolling also helps to facilitate the privatization of our highway network because most public private partnership (P3) models seek to recover construction and operating costs by imposing tolls on new bridges and highway projects.

The Golden Ears Bridge is an example of this kind of privatization. Opened in mid-2009, traffic volumes have been lower than expected. This case illustrates there can be problems of leakage where alternate non-tolled routes exist.

According to TransLink figures, the Golden Ears Bridge is not meeting its revenue targets. While daily traffic volumes have slowly increased in recent months, they remain significantly below TransLinks’s original estimates. As a result, TransLink increased the tolls on the new bridge on July 15, 2010 to capture additional revenue.

Under the terms of the P3 agreement, the payments due to the private company that built and operates the bridge will step up to $4 million per month this year and rise to $4.8 million per month in 2015. If the number of vehicle trips over the bridge continues to lag behind the estimated traffic volumes, TransLink will have to keep raising the tolls to keep up with the P3 payment schedule.

Under a traditional public financing model, big infrastructure projects benefit from lower operating costs and lower government borrowing costs. These costs are predictable and can be amortized over 25 or 30 years. If traffic volumes don’t meet pre-construction projections, the government doesn’t have to hike tolls.

A system-wide toll makes sense. It is the best means to finance the necessary maintenance, repairs and replacement of our highway network. It will also treat all users fairly, allow price signals to regulate demand, and keep our highway infrastructure in public hands, which ultimately saves money for taxpayers.

NEWS: Seeking Solutions for Municipalities

editor — Mon, 14 Feb 2011 12:32:24 -0800

By Think City Staff

It’s been ten years since the last leadership change in Victoria, yet BC’s municipalities face many of the same problems that were around a decade ago. In some cases, these problems have only gotten worse.

Homelessness has risen. The infrastructure deficit has grown. Residential property taxes and related fees are rising at an unsustainable rate. Public participation in civic life has declined.

Citizens and their local councils are well aware of the difficulties they collectively face, but, for the most part, are powerless to do anything about them. Under our nineteenth century federal constitution, BC’s local governments are still creatures of the province.

Today, as in 1867, the municipal buck stops on the Premier’s desk. That’s why Think City is asking the six declared candidates for the leadership of the BC Liberal Party for their views on specific democratic and economic reforms they would make at the local level should they win the top spot at their party’s convention on Feb. 26.

Take for example the 2008 civic elections. Across the province, municipalities were plagued by numerous cases of electoral violations, unethical conduct and maladministration during the last round of civic elections. Some of these cases resulted in police investigations, inquiries, and legal challenges.

In addition to these specific concerns, BC’s local elections continue to be marred every election cycle by remarkably low voter turnout. Many mayors and councils are elected by only a few per cent of citizens. In the province’s biggest city, Mayor Gregor Robertson received less than 17 per cent of eligible voters support.

When Think City surveyed nearly 3,700 British Columbians last year, a majority of citizens said they wanted the province to make major changes to how we finance and administer elections. From banning union and corporate donations to direct votes for regional representatives, from giving local governments the power to reform their own electoral systems to setting campaign donor and spending limits, a majority of BC’s citizens said they wanted significant changes made to the how we conduct municipal elections.

Economically, the situation is dire for many of BC’s local governments. In Think City’s Local Prosperity report released last November, authors James Fletcher and Doug McArthur warn that “our municipalities have seen a steady erosion of services, an unsustainable increase in property taxes and user charges, and a growing infrastructure deficit as necessary projects are deferred.”

The province’s current model for financing local governments is simply not doing the job. New legislative tools are needed to give BC’s municipalities the means to both raise revenues and develop their local economies.

If no changes are made, British Columbians will continue to suffer “higher housing costs, reduced disposable income, a less competitive business environment, higher unemployment, increased traffic congestion and longer commutes, a lower standard of public services, and a slow erosion of our quality of life,” say Fletcher and McArthur.

Many municipalities are struggling to maintain their aging bridges, sewers, community centres and water systems. How are they going to afford the infrastructure needed in a growing province?

What aid will Victoria provide to rural towns coping with declining resource sectors and industrial tax revolts?

When is BC going to take big money out of local elections and restore the public’s faith in how local politicians are elected?

These are the kinds of questions that Think City wants to the BC Liberal leadership candidates to answer. The results of the questionnaire will be published on Feb. 24 and posted on our web site here.

To view the questions, please click here. Think City will also administer the same survey to the leadership candidates for the BC New Democratic Party in March.

NEWS: Residents Tell City to Share the Road

editor — Wed, 09 Feb 2011 21:32:45 -0800

By Think City Staff

Can citizens come up with practical solutions for pedestrians, cyclists, transit users and private vehicles to better share the road?

Think City and Vancouver's Grandview Woodlands Area Council (GWAC) tried to answer that question with the Share the Road project that took place over the summer and fall of last year. The first phase of the project is now complete, and Think City would like to share what we found – both the process and the outcomes.

The process was designed to involve people in discussions that lead to specific improvements in this vibrant East Vancouver neighbourhood. The desired outcomes are changes to the use of road space to make the area pleasanter, safer, healthier, and more sustainable.

Think City and GWAC drew up proposals for the Grandview Woodlands area based on suggestions from nearly 1,000 members of the public. Initially a working group of local people proposed ideas which went into a survey. The survey, which also invited further suggestions, was completed by 839 people of which 650 have a close connection with the area (i.e., live, work or visit weekly). There was also a table at Vancouver's annual Car Free Day on Commercial Dr. where 150 people made suggestions. The survey results and ideas gathered were considered at a meeting of local volunteers who drew up a set of proposals.

These proposals and the survey results were presented to GWAC in September 2010. After further discussion, the working group prepared a final set of policy proposals. In late 2010, these proposals were forwarded to the City of Vancouver as well as several other local organizations in support of walking, cycling and public space.

The process was very encouraging because people put a lot of thought into their suggestions and shared a great deal of local knowledge. The community interest that has been shown in this project demonstrates the public is willing to participate and support planning processes that demonstrate genuine interest in citizen participation.

Think City hopes the city will take the next step and begin to engage the community in a dialogue on how and when these proposals could be implemented.

Below is a summary of the main proposals:

Make Commercial Dr. more pedestrian friendly by reducing traffic to one lane each way from Broadway to E. 1st Ave., with on-street parking to access local business. The space gained from reducing the width of the road could be used to upgrade the environment with trees and flowers, benches, bike parking, bus shelters, etc.
Between E. 1st Ave. and Venables St. people wanted to see on-street parking restored all day. This would mean allowing only one lane of traffic in each direction. In the longer-term the city should seek ways to enhance and widen the sidewalk on Commercial Drive.
The pedestrian crossings on Commercial Dr. at E. 1st Ave. and Broadway are too dangerous. Pedestrians are rushed and have to dodge turning cars. This could be improved by changing the traffic lights to include a phase when all traffic is stopped (including turning) and pedestrians can cross in all directions. This is called a pedestrian scramble.
Along Victoria Dr. between Venables St. and Broadway there are several schools and parks. This stretch of road could be made safer and more pleasant by calming the traffic with improved pedestrian crossings and a bike lane.
Many of the pedestrian-controlled crossings would be safer if there was more time for people to cross the road.
Bus flows would be improved if traffic lights were triggered to change when a bus approaches the intersection.
Residential streets would be safer and more pleasant with slower car speeds. This would be achieved by reducing the speed limit on local streets to 40 km/hour. This should be reinforced by changes to the road space making it clear these are areas to be shared with other uses. Narrowing street junctions with planting bulges, wider boulevard strips with more greenery and home zones would also enhance the neighbourhood.

There were also a number of danger spots highlighted such as a parking lot driveway on the south west corner of E. 1st Ave. and Commercial Dr. This turning spot is dangerous for cars and pedestrians and blocks traffic in the intersection.

One of the overall aims of these proposals is to reduce the volume of through traffic in the area. Unfortunately, this goal clashes with the current provincial mega-project to widen Highway One from Langley to Vancouver, which will increase the amount of traffic entering the city. However, traffic calming in Vancouver can help moderate traffic in local neighbourhoods.

In the longer term, the success of local traffic calming could increase pressure on the province to adopt more sustainable transport policies and invest in better quality public transport throughout the region, including improved rapid transit from Surrey and the Tri-Cities. However, Think City’s Share the Road project deliberately focussed on actions the local government can do by itself, at modest cost, without waiting for the province.

These proposals would make the community safer and healthier, improve the environment, and increase neighbourliness. They would support Vancouver’s goals to be the world's greenest city and to achieve half of all our urban journeys by walking, bicycling and riding transit, rather than driving cars.

The strength of the ideas, and the level of public interest and knowledge demonstrate the benefits of the city working together with local people. When the city develops neighbourhood and transportation plans they should look at this model of public engagement.

The full results of the survey and the final policy proposals are available by clicking here.

Think City would like to acknowledge all the people who submitted ideas to Share the Road. The support and involvement of the GWAC directors was also instrumental to the success of the project.

OP-ED: Robson Square Makeover Needed

editor — Wed, 09 Feb 2011 21:18:07 -0800

By Dave Crossley

Where’s the square? That was the question posed by the Vancouver Public Space Network in 2009 when it held a design ideas competition to highlight Vancouver’s lack of a purposeful central gathering place – a true town square.

As anyone who has visited the great cities of the world (not to mention many charming smaller towns) knows, a lively town square adds something truly valuable to the heart of any urban community.

Whether it’s New Year’s Eve in Times Square, a protest rally in Trafalgar Square, or a weekend market in a small Italian village piazza, such public gathering spaces and the activities they host contribute something vital to a community. And its something Vancouver has been lacking for a very long time.

During the 2010 Winter Olympics many residents and visitors experienced, even if only temporarily, what a truly vibrant urban square feels like. With the temporary closure of several blocks of Robson St. the area came alive with tens of thousands of people.

Many of the thousands who thronged Robson Square and the nearby streets were drawn to the activities on offer during the Olympics – such as the zip-trek line that had folks lined up for hours, the skating rink, the free entertainment, and the nightly fireworks show. But others simply came out to join the crowds and soak in the festive atmosphere that had taken hold in the heart of Vancouver. It was truly a place to be.

For those two short weeks in February 2010, Robson St. and a portion of Robson Square came alive. Even some hardened Vancouverites dared to suggest that our city might finally be shedding its reserved attitude, and well-deserved reputation as “no fun city”.

Unfortunately, as the light from the Olympic flame became a distant memory, the tents were folded, and the traffic returned to the streets, Vancouver quickly returned to its old staid, conservative self. Quickly it became apparent just how temporary it had all been. With the one small exception of the subterranean skating rink, which was back in gear this winter, Robson Square returned to its old self as well.

Indeed, several media commentaries about the utter lack of any civic activity or celebration this past New Year’s Eve noted how embarrassing it was for a city that prides itself on being cosmopolitan and world-class.

While countless throngs celebrated under fireworks in Sydney, and partied under the dropping-ball in New York, thousands more rang in the New Year at the Seattle Center and the Space Needle, and partied with a concert in Nathan Phillips Square in Toronto.

Meanwhile Vancouver’s streets were kept clear of any public gatherings. Where’s the party? As anyone who’s tried to plan an event knows, you first need a venue. Where’s the square?

But Vancouverites should be asking – does it have to be so? The answer, of course, is no. How our public spaces are designed, redesigned, utilized and operated should be the topic of vigorous public debate and discussion.

And there has indeed been some discussion about including a public plaza in the proposed new art gallery on the Larwill Park site (the old bus depot site behind the Queen Elizabeth theatre). However, this location on the eastern edge of downtown butted against the Beatty St. escarpment presents several difficulties.

It is an uncomfortable edge-zone far from the commercial and entertainment heart of the downtown. It is not nearly as well served by public transit. The surrounding buildings do not provide the same sense of enclosure and intimacy – contributing to the exposed mouse-on-the-snow feeling. But most importantly, it is not where Vancouverites choose to congregate to celebrate playoff hockey victories, or hang out on warm summer nights. Historically, that place has been Robson St. and good planning builds on and improves what already works.

Recent developments provide the perfect opportunity to once again urge our civic leaders to seize this issue and make some concrete progress. At present, a large portion of the northern part of the Robson Square complex is behind fences, as it undergoes repairs and maintenance. To facilitate this work the single block of Robson St. between Hornby St. and Howe St. has been temporarily closed to traffic.

Vancouver Councilor Suzanne Anton, among others, has quite rightly asked why this street closure can’t become permanent, and the space given over for a much-needed public square?

Massive traffic chaos has not ensued as a result of the street closure. Transit re-routing seems to be working. So why can’t a re-configured Robson Square that includes that one block of Robson Street become Vancouver’s missing town square – permanently? Well, as that brief time during the Olympics demonstrated, it can, and it should.

Even if there were general agreement and support for moving forward, there would be issues and challenges. There would need to be consultation with the public and interested parties such as UBC, the Vancouver Art Gallery, and others. A successful vision and design would need to be developed. And funding would need to be secured to make it a reality.

But in a city where we spend millions of dollars putting a new roof on a sports stadium, and almost a billion dollars building a convention centre, surely we can come up with the money to design a relatively small, compact but vibrant town square for the people of Vancouver.

The city and the province already own and control the space – there’s no need to buy up land, or displace private property. The street is already closed, and the space partially dug up. As we enter an election year, now is the time to build up steam in support of building the town square Vancouver deserves.

What’s missing is political vision, leadership, and a commitment to make it happen. The conversation has started, but it needs to go beyond general platitudes. We need leadership to make further progress. Only then can the practical challenges of funding and design be tackled to answer the question “Where’s the square?”

Dave Crossley is a resident of Vancouver, and holds a Bachelor of Arts Degree (Honours) in Geography and a Certificate in Urban Studies from Simon Fraser University.

OP-ED articles do not necessarily reflect the opinions of Think City. To make a submission to the OP-ED section of the Think City Minute, please email editor@thinkcity.ca for details.

OP-ED: Fairer Taxes and Modest Cuts

admin — Tue, 14 Dec 2010 11:33:27 -0800

Last week, a parade of special interest groups, community leaders, big business representatives and union presidents told Mayor Gregor Robertson's council to sharpen their pencils and revise the City of Vancouver's 2011 budget.

Council heard that taxes are either too high or too low. Service cuts are too deep or not deep enough.

But lost in the shuffle were the priorities of citizens.

Over $13 million in cuts are being proposed to balance the 2011 books. City council is also bringing forward a four-per-cent tax hike for homeowners and a minor decrease in commercial taxes in 2011.

What do citizens think of the draft budget? Do they like city hall's recipe for service cuts and tax increases? Based on two recent citizen opinion surveys, the answer is both yes and no.

According to a city-commissioned poll of 509 residents, 51 per cent of citizens favoured a mix of service cuts and limited tax increases, while 24 per cent want taxes raised to ensure there are no cuts. Think City found a similar trend in its annual Citizen Budget survey of 1,758 citizens, with 41 per cent supporting a mix of cuts and taxes and 40 per cent calling for a tax increase to stave off further cuts.

Based on these results, city council has a mandate from voters to keep civic spending in check. But when citizens are asked what to cut and what to keep, the draft 2011 budget appears out of step with public priorities.

At the top of the city's cuts list is corporate services. With a 7.6-per-cent budget cut, this department is responsible for city hall activities that most citizens do not directly use or benefit from, such as the city manager's office, human resources, information technology services and other internal functions.

The next tier of service cuts will affect community services, parks and recreation, and libraries -these three departments will see a 2.6-per-cent to 2.8-per-cent budget cut. The last tier of cuts are to fire, police, engineering and utilities. These cuts range from 0.5 per cent for fire to 0.8 per cent for engineering and utilities.

Except for the police department, both the city poll and the Think City survey found similar levels of public support for libraries, parks and recreation, the fire department, engineering and utilities, and community services. Libraries received the highest level of support in both studies.

Corporate services had the lowest level of public support of all city departments in Think City's survey, with 44 per cent calling for a budget reduction. The city's survey did not gauge support for corporate services.

From the two surveys, it's clear citizens do not support making deep cuts to some high-priority departments while leaving others relatively unscathed.

On taxation issues, there is even less agreement on the direction the 2011 city budget should take.

The majority of citizens are opposed to shifting the tax burden from commercial property owners to homeowners. In Think City's survey, 58 per cent were opposed to shifting two per cent of commercial property taxes to residential property owners, while only 16 per cent favoured the shift. Citizens were not asked their opinion on the tax shift in the city's survey.

What should the city do to address citizen concerns about tax fairness and service cuts?

Think City offered city council two options at the Dec. 2 final public hearing on the city budget:

Minimize Cuts Through Fairer Taxation: Council should defer the $5-million commercial property tax break and raise taxes by the rate of inflation to three per cent across the board for all taxpayers.
Balanced and Fair Cuts: If the first option is rejected, council should spread the proposed $13.4-million in cuts more equally across all city departments. Reductions should be made by comparing departmental reductions for 2009, 2010 and 2011 to ensure that the overall impact on citizens is minimized.

Think City favours the first option. Tax fairness is restored and only modest cuts of $3 million will be required to the city's 2011 budget.

If council adopts the second option, cuts in service will be spread more evenly across city departments. As well, the mayor's election promise to shift $30 million in taxes from commercial property owners to homeowners will have been fulfilled.

Either way, citizens' priorities will have been better heard in this year's budget consultation.

The results of the Think City 2011 Citizen Budget survey can be found here.

Neil Monckton is the chair of Think City. This article was first published in the Vancouver Sun on Dec. 14, 2010.

NEWS: Village Triple-Bottom Line Woes

editor — Fri, 03 Dec 2010 15:37:26 -0800

Vancouver’s desire to make the Olympic Village a triple-bottom line success story has taken more beatings in the past few weeks.

Environmentally, the Olympic Village is a jewel in the crown of green development. However, economically, the project is all but bankrupt, while socially, the affordable housing outcomes fall far short of their goals.

City taxpayers are now the owners of the Millennium Water project at Southeast False Creek after the project went into receivership on November 17. Ernst & Young Inc. has been appointed the receiver for the market housing development, officially known as Millennium Southeast False Creek Properties Ltd.

Both the city and Millennium tried to put the best possible face on the agreement – even going so far as to call it a “best case scenario for all of us.” But the fact remains that city taxpayers are now completely on the hook for the entire $740-million project.

Developer Rob Macdonald’s assessment of the factors that drove up the costs of the Olympic Village places the current value of the assets at $570-million. Other development experts believe this figure is somewhat generous, and the city could lose as much as $300 million when all the dust has settled.

Despite assurances from the mayor that all 737 units will eventually sell, it now appears certain that many will have to be sold at a substantial loss. Following the 2010 Olympics, sales have been very slow as buyers held back due to the uncertainty over the project’s future and a market already saturated with similar product at more competitive prices. Widespread media speculation that prices at the Olympic Village would soon be slashed has also put prospective buyers into let’s-wait-and-see mode.

It has been reported that Vancouver condominium marketer Bob Rennie had been seeking approval from the city and the developer to cut prices. Now that Millennium is out of the picture and Ernst & Young is handling the project for the city, many observers expect to see price cuts announced within weeks.

There has been much debate over what caused the cost overruns on the project and who is to blame. The Reader’s Digest version is that a series of bad decisions made by the Coalition of Progressive Electors, the Non-Partisan Association (NPA) and Vision Vancouver council majorities all contributed to the False Creek fiasco.

In particular, the city’s decision to award the entire project to one developer rather than breaking it into separate parcels, the decision to select the highest bid from a developer who lacked the resources to complete the project, the decision to “build a model sustainable community”, the decision to upgrade the green building certification from silver to gold standard, the decision to do design simultaneous with construction (which drove up the number of expensive change orders), and the overtime and labour costs of working to meet an Olympic deadline were all important factors in driving up development costs.

Since the last flickers of the Olympic flame, further delays and poor decisions have burdened the project with millions in additional operating costs and debt service charges as the overpriced condos have sat empty for the last eight months.

According to Rob Macdonald, when the city took over the project financing, it borrowed at an interest rate of about 2.5 per cent – a significantly lower rate than the private sector developer could obtain. But instead of passing this rate along to the troubled project, the city chose to charge Millennium Water rates that were approximately $30 million higher. Given the city’s stake in the project (at that point it was the ultimate guarantor and was still owed $170 million for the land), its decision to add to project’s debt load imposed another unnecessary cost.

In addition to the financial woes, city hall’s social development goal to create more affordable housing in Vancouver has also fallen far short of what was promised in the 2010 Games bid book. The affordable housing component has fallen from two-thirds of the entire village site to less than 20 per cent.

First the NPA knocked down the requirement for one-third social housing, one-third subsidized, middle-income “modest market housing” and one-third market housing to 25 per cent social housing in December 2005. Then, in April 2010, Vision Vancouver divided the 25 per cent social housing segment into two equal portions of partially-subsidized rental housing and social housing.

Now, seven months later, the Vision council announced the third affordable housing configuration for the troubled development. The Co-operative Housing Federation of BC (CHF BC) has been selected to establish a non-profit housing co-op in one of the city’s three non-profit buildings. The other two buildings will be managed by COHO Management Services Society, a branch of CHF BC, as partially-subsidized rental housing.

Under this new plan, the number of partially-subsidized rental housing spaces rises to 168 units. At the same time, the social housing component will be reduced from 126 units to a share of the 84-unit co-op. The balance of the co-op will be made up of market rental units.

These 252 units represent a tiny step towards meeting the demand for housing that is affordable for those not pulling in six-figure incomes. In the future, however, taxpayers will demand that any affordable housing projects be built more modestly. Decent affordable housing can be built for about one-third of what these monuments to Olympic hubris cost.

Whether there is the political will and the developer confidence to take risks after the Olympic Village debacle is another question entirely. What’s for certain, the triple-bottom line approach that privileges environmental standards over social and economic goals will need to be reconsidered.

NEWS: Draft Budget Cuts Services Again

editor — Thu, 02 Dec 2010 16:34:40 -0800

Do citizens support the draft budget that Vancouver city council is considering for 2011? From two recent studies – one conducted by city hall consultant Market Dimensions and the other by Think City – the answer appears to be both yes and no.

Both studies found that for the third budget in a row, the majority of citizens recognize the need for civic belt tightening. However, when it comes to service priorities and tax fairness, city hall and citizens remain at odds.

According to the city’s 2011 interim budget estimates introduced to council on Nov. 30, $13.4-million in cuts are being proposed for seven city departments. In addition to these service cuts, city council will also consider revenue changes including a tax shift from commercial property owners to residential property owners, resulting in a 4.0 per cent tax hike for residents and a minor decrease in commercial taxes in 2011. City council is also looking at boosting revenues through fee increases of 2.75 per cent and a 6.9 per cent increase to utility rates.

When it comes to balancing taxes and service cuts, citizens recognize the need for city hall to exercise restraint. The Market Dimensions poll of 509 citizens found that 51 per cent of citizens favoured a mix of service cuts and limited tax increases. Think City found a similar trend in its survey of 1,758 citizens with 41.3 per cent supporting the cut/taxes mix, 40.0 per cent opposed to any service cuts and 18.8% opposed to any tax increases.

But while there may be agreement on the need to balance tax increases and service cuts, for the most part, citizens have a different view than city hall on how those cuts should be made.

In the proposed budget, there are departmental winners and losers when it comes to reductions. Police, fire, and engineering are projected to receive minimal cuts in funding, while community services, parks and recreation, libraries and corporate services are slated for much deeper cuts.

At the top of the city’s cuts list is corporate services. With a 7.6 per cent budget cut, this department is responsible for city hall activities that most citizens do not directly use or benefit from, such as the city manager’s office, human resources and other internal functions. The most visible signs of these cuts to citizens will be the reductions made to cleaning and maintenance of public facilities.

The next tier of service cuts affects community services, parks and recreation and libraries – these three departments will see a 2.6 per cent to 2.8 per cent budget cut. City libraries will have fewer staff, less funding for new resource materials and a delay in the September 2011 opening of the new Hillcrest branch. Parks board will also see staff and service reductions, along with new fees for youth and toddlers, and a 4.0 per cent fee increase for most parks board services. The cuts for community services are not yet known, however a reduction to the public consultation budget is mentioned in the council report.

The last tier of proposed service cuts are to the fire, police and engineering departments. These cuts range from 0.5 per cent for fire to 0.8 per cent for engineering. The specific cuts to fire are not disclosed in the budget draft. The police will continue to focus cuts on civilian staff and other non-frontline policing expenditures. Engineering will not fill vacancies created by attrition, impacting some programs and capital work.

Except for the police department, both Think City and Market Dimension surveys found similar levels of public support for libraries, parks and recreation, the fire department, engineering and community services. Libraries received the highest level of support in both studies.

Corporate services had the lowest level of public support of all city departments in Think City’s survey, with 44.2 per cent of respondents calling for a budget reduction. The Market Dimensions survey did not gauge support for corporate services.

Citizens also oppose council’s continued shifting of the commercial property tax burden to residential property owners. By the end of 2011, the city will have reduced corporate taxes by $51 million, shifting the entire amount onto Vancouver homeowners.

In Think City’s survey, 58.0 per cent were opposed to the shift, while 15.9 per cent said they were in support of the policy. The Market Dimensions survey did not ask citizens their opinion on the shift.

When asked by Think City, 70.6 per cent of those citizens surveyed supported delaying the tax shift for 2011 and raising taxes across the board for both commercial and residential property owners by four per cent. Such an increase if adopted, would make the majority of the proposed $13.4 million departmental budget cuts unnecessary.

The results of Think City’s Citizen Budget survey were presented to city council on Dec. 2 at the special public hearing on the 2011 operating budget. To view the Citizen Budget survey results and Think City's recommendations to Mayor Gregor Robertson and city council, click here.

OUR VIEW: Citizen-Driven Budgets

editor — Thu, 02 Dec 2010 12:43:42 -0800

What would Vancouver look like if citizens were able to make real spending decisions with public dollars?

It’s called participatory budgeting and it has been used around the world to engage citizens in Uruguay’s capital city of Montevideo to Montreal’s Plateau Mont-Royal borough, from the Paris suburb of Saint-Denis to Toronto’s public housing authority.

First developed in the industrial city of Porto Alegre, Brazil, participatory budgeting allocates a portion of the city’s budget to projects chosen through a democratic process where citizens choose which projects will receive funding.

The 2,000-plus cities worldwide using participatory budgeting are at the forefront of an international movement to involve citizens in determining civic spending priorities. But is this concept too democratic for Vancouver?

As part of Think City’s 2011 Citizen Budget survey, over 60 per cent of 1,754 respondents said they favoured more citizen participation in budget making that would go well beyond the consultation process the city currently uses. In fact, for the last three Citizen Budget surveys, over 20 per cent of those surveyed say they want to see residents provided with the means to learn about, deliberate, and make binding decisions on some or all of the city’s budget.

In a 2008 Think City Dream Vancouver pre-election survey, all three civic political parties agreed, and Vision Vancouver strongly agreed, when asked to rate their support for the following policy option: “The city should provide citizens with direct ways to set city council priorities between elections (e.g., ongoing democratic reform through a citizens' assembly or annual/capital budget development through participatory budgeting).”

Participatory budgeting works much the same way city councillors make decisions about the annual operating budget. With assistance from city staff, citizens are able to draw upon the same kind of professional advice that city councilors receive. However, it is citizens that initiate projects, make the case for why they should be funded, and ultimately, decide which projects go forward.

Where the process has been used the result has been a more engaged citizenry, higher voter turnout in elections, and greater participation by people from marginalized or disadvantaged backgrounds.

Chicago may seem a strange place for participatory democracy, given the windy city’s famous culture of patronage politics and lack of transparency in public finances. However, it was public dissatisfaction with backroom politics that made Chicago ripe for change. As Chicago Alderman Joe Moore said, “…it exceeded even my wildest dreams. It was more than an election. It was a community celebration and an affirmation that people will participate in the civic affairs of their community if given real power to make real decisions.”

While there is no single model for participatory budgeting, the process usually begins by establishing the financial parameters of the process – how much money is available. Then participants engage in a needs assessment to determine priorities. Finally, they weigh the merits of specific projects and rank them in order of priority.

The advantage of the process is that it changes the relationship between citizens, activists, and the government. Instead of simply demanding the government provide, citizens must convince an assembly of their peers why a particular project is good value for money. When citizens become decision makers they are forced to listen and respond to the requests of others, and recognize the constraints of a finite budget.

The capital plan that will be put to voters in the November 2011 election presents the city with a unique opportunity to engage citizens in a participatory budget process. The capital plan is approved by referendum, and authorizes the city to borrow money to build certain projects over the next three years. It’s basically a shopping list of big-ticket items that get bought on the city’s credit card.

Coming up with the list of projects has usually been left largely to city staff and elected officials with some public input. Once every three years voters are presented with a long list of items and then asked to make a thumbs-up or thumbs-down decision at the ballot box. Through a participatory budgeting process, Vancouver citizens can take part in a process to decide what goes on the shopping list.

Even if a fraction of the capital budget is put on the table, as was the case in Montreal’s Plateau Mont-Royal borough, the prospect of opening up the budget process to direct citizen participation would be a major step forward.

Mayor Gregor Robertson and his council have a unique opportunity to break down Vancouver’s very conservative approach to public involvement. If the experience of other cities is anything to go by, participatory budgeting is a democratic reform that will be sustained by future councils, regardless of their political stripe.

It’s time to move beyond advisory committees and web polls and actually involve citizens in decisions that affect their neighbourhoods. If cities as large and complex as Mexico City and Sao Paulo can involve their citizens, surely Vancouver can as well.

OP-ED: Municipal Finances Need Overhaul

admin — Thu, 25 Nov 2010 10:13:15 -0800

By James Fletcher and Doug McArthur

Our cities and towns are in trouble.

The present model of local government financing simply doesn’t work, and indeed, it can’t work.

Local governments receive only eight per cent of all tax revenues collected in this country but are faced with ever-growing costs, as other levels of government offload responsibilities without providing adequate resources to pay the bills.

The result has been a steady erosion of services, an unsustainable increase in property taxes and user charges, and a growing infrastructure deficit as necessary projects are deferred.

The consequences of this broken funding model include higher housing costs, reduced disposable income, a less competitive business environment, higher unemployment, increased traffic congestion and longer commutes, a lower standard of public services, and a slow erosion of our quality of life.

Fundamentally, local governments are created by the province. Their tax raising powers are set out in provincial law – such as the community charter and the local government act. These taxing powers are limited to the ability to tax property and impose various user charges for services. Provincial government revenues such as sales taxes, income taxes, resource royalties, and various other taxes are not shared.

It was not always this way in BC. In 1978, the province introduced a revenue-sharing program that provided a guaranteed share of provincial revenue sources including personal and corporate income taxes, sales and fuel taxes and natural resource revenues. It also ensured that less well off communities could afford services comparable to the rest.

Over the past 32 years, successive provincial governments have chipped away at these transfers, leaving local governments with little choice but to cut services and increase taxes.

The results have been predictable – large industries and small businesses alike are demanding tax breaks, well aware that their competitors benefit from more favourable tax regimes in other jurisdictions.

Many cities and towns, including Vancouver, have responded by shifting the tax burden from businesses to residents, and from property taxes to charges for services. Residents in Port Alberni saw their tax bills jump by 23.6 per cent this year when Catalyst Paper refused to pay its taxes. In Vancouver homeowner taxes increased four per cent while charges for water and sewer and other services increased by over 11 per cent.

Shifting the tax burden from businesses to residents and driving up user charges doesn’t reduce the burden on residential property owners, takes money out of consumers’ pockets, and ultimately, does not solve the real problem.

Earlier this year, the province established the industrial property taxation review to address the concerns of big business, such as Catalyst Paper. However, its recommendations will impact communities – and residential taxpayers – all over the province.

Having opened this can of worms, the province needs to completely re-examine how local governments in this province are financed. Maybe this means expanding the taxing powers of local governments. Maybe this means sharing sales tax revenue like Saskatchewan does – perhaps by reconfiguring the HST to provide direct, unconditional funding to local government. And maybe it means some form of revenue equalization.

A new model of local government financing is necessary – and the need for it is becoming more urgent with each passing year.

For the past year we have studied this issue, and have just released a paper titled “Local Prosperity: Options for Municipal Revenue Growth in British Columbia.” We argue that local governments in BC are far too dependent on property taxes and property-related user charges and need access to a much broader range of revenue sources.

We examine the changing economic landscape and propose dozens of new revenue generating ideas and promising economic development concepts.

As part of our research, we surveyed mayors, councilors and senior staff in local government all over BC. We found many municipalities struggling to adapt to challenging economic conditions, an aging infrastructure that is becoming more costly to operate and maintain, escalating costs in areas beyond their control, and a residential and business tax base unable to sustain the current rate of tax increases.

It is time for a fundamental restructuring of provincial-municipal financing in British Columbia. Any new system should ensure that local governments have the infrastructure and operating funds necessary for communities around BC to successfully make the transition to a modern economy, provide an overall tax regime that is competitive for business, and address some of the growing inequities between urban and rural BC and between higher-income and lower-income taxpayers.

This kind of change will require the provincial government act to increase transfers and broaden the revenue tools available to local governments.

This change is needed urgently if British Columbia is to compete successfully as an efficient, high-wage, high-value producing economy in the global economy.

James Fletcher is a researcher and writer with Think City. Doug McArthur is a professor with the School of Public Policy at Simon Fraser University.

OP-ED articles do not necessarily reflect the opinions of Think City. To make a submission to the OP-ED section of the Think City Minute, please email editor@thinkcity.ca for details.