Funding mobility: Do things better, and differently, says CAA-Quebec

The initiative to reform mobility funding launched by the Government of Quebec needs to give rise to fair and innovative solutions. CAA-Quebec wants to see bold ideas that go beyond the old knee-jerk reaction of hiking fuel taxes. Drivers already pay their fair share. What we need are effective solutions for new, sustainable forms of mobility that meet peoples’ needs.

Carrots are better than sticks

If people are going to develop new behaviours and adopt sustainable modes of transportation, they’ll need more incentives. Making life more expensive for vehicle owners is not the way to go. The Quebec government, municipalities, and businesses need to find ways to drive the adoption of new, efficient public transportation solutions. For example:

·         Encourage people to use ride-sharing platforms by providing financial incentives for users. Hundreds of thousands of drivers travel alone in their cars due to a lack of incentives. But ride-sharing is an effective, inexpensive, and concrete way to reduce the number of vehicles on our roads at rush hour.

·         For businesses, why not create a financial incentive for offering a guaranteed ride home in a taxi, paid for by the employer, for employees who use shared and public transportation? We need to come up with concrete solutions for workers.

“Mobile technology creates opportunities to use vehicles that are already on the road for ride sharing,” says Sophie Gagnon, Vice President of Communications and Public Affairs with CAA-Quebec. “We could eliminate a lot of solo driving right there! And we should be funding those solutions with money from the Green Fund, which already gets a hefty amount from drivers.”

That’s why CAA-Quebec’s no. 1 recommendation is to use the funds in the Green Fund to develop public transportation solutions of all kinds, including light modes like ride-sharing and other car-sharing solutions. The upside of these types of solutions is that they don’t cost much to roll out and they can be used throughout the province, particularly where buses and other heavy‑duty vehicles aren’t cost-effective. Drivers pay into the Fund every time they fill up. It’s only logical to use the Fund to reduce road congestion and pollution.

Funding at a crossroads

The current model for funding public transportation isn’t viable long-term, for a number of reasons:

·         Fuel taxes account for $673 million (1) of funding per year. That amount is set to decrease as more and more people opt for public transport and electric vehicles and as conventional vehicles become more fuel efficient. Basically, the source of the funding is shrinking.

·         As the population ages, revenue from driver’s licences and vehicle registrations will decrease. Not to mention that today’s young adults are less interested in owning a vehicle and getting their driver’s licence.

·         The government’s current scheme amounts to double taxation. For example, pollution is taxed through the carbon market (more than 4¢ per litre of fuel, on average) and through a special tax on vehicles with a large cylinder capacity.

·         Not to mention that people paying into the Green Fund also have to pay income tax.

With the brief submitted today (in French only) as part of the province-wide consultation on mobility funding, CAA-Quebec is furthering the discussion in a positive way.

Roads and public transportation are a common good, which is why we need to hear from every social sphere, including drivers, who currently contribute a full 20% of the budget for public transportation (2) through various sources. The discussion on mobility funding needs to acknowledge and account for that fact.

Solution to be found in diversification, not fuel

To fund mobility in a way that’s more sustainable and fair, the government needs to diversify its sources of funding. For example:

·         A mileage tax, or VMT, is an interesting idea, but only if it replaces all the other taxes. It’s a simple, fair way to tax drivers, since it’s based on actual use and applies to any vehicle owner who uses the road network, be it with an electric or fuel-powered vehicle. 

·         A tax on real estate gains and a payroll tax are interesting avenues, since both would ensure that businesses and property owners who benefit from public transportation pay their fair share.

·         As for road tolls, it all depends. They can be an acceptable way to pay for new infrastructure, but only if there are viable alternate routes that are free and properly maintained.

About CAA-Québec

CAA-Quebec is a not-for-profit organization that assists each of its members by providing mobility, travel, insurance, and residential benefits, products, and services.

– 30 –

_________________________________

^{(1) Additional fuel tax - $111 million + Carbon market – $254 million + Provincial fuel tax – $308 million}

^{(2) Calculated by CAA-Quebec using official data.}