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Transit riders at the Surrey Central Skytrain station in Surrey, B.C., on March 4, 2015. (Jimmy Jeong For The Globe and Mail)
Transit riders at the Surrey Central Skytrain station in Surrey, B.C., on March 4, 2015. (Jimmy Jeong For The Globe and Mail)

Surrey mayor mulls taking back gas taxes to finance city's light rail Add to ...

Surrey’s mayor is looking at all options to finance light-rail transit for her city now that voters have rejected a sales tax, including a potentially controversial move to take back Surrey’s hefty share of gas taxes that now go to TransLink. Mayor Linda Hepner floated the idea in an interview as she listed off some of the ways her fast-growing city could go it alone. The suggestion prompted one Vancouver councillor to warn municipalities to stick together in finding solutions.

“You cannot be a major city in this country without a transportation system,” Ms. Hepner said.

Any move to withdraw Surrey’s share of its gas-tax revenues would likely produce huge difficulties, but the city’s share of TransLink gas tax is considerable: According to Ms. Hepner’s campaign literature, that share is about $64.5-million. However, it goes straight to TransLink under current provincial laws.

Surrey also nominally has a share of federal gas tax, which will be close to $25-million this year. Through agreements with the province and the Union of B.C. Municipalities, that money is also committed to TransLink. But later this year, for the first time, Metro Vancouver mayors will get to decide exactly how the region’s entire share of federal gas-tax money, about $125-million, will be spent.

Most of it will go to TransLink but mayors, who now will have a small, direct say into how the agency spends its $1-billion budget, will have to approve what projects that will be spent on.

Vancouver Councillor Raymond Louie, who chairs the task force that will allocate that money, said it’s important that money be used for regional projects that are integrated with the system.

“If we were to break it up completely, that would be a problem.”

Mr. Louie said he understood Ms. Hepner’s in which voters rejected a new .5-per-cent sales tax that would have paid the local one-third share in any major projects.

Ms. Hepner said her city could also look at tapping into the city’s financial reserves and hiving off contributions from developers who get rezonings, which usually go to other community services.

Mayors throughout the Vancouver region have been left searching for alternate ways to fund multibillion-dollar transit projects after voters soundly rejected the proposed sales-tax increase.

Surrey would need to come up with about $60-million a year for 30 years to cover the cost of its one-third share of the $2.2-billion light-rail system, Ms. Hepner acknowledged, even if the line was built as a public-private partnership.

Private partners are typically brought in to help finance and assume the construction risk on transit projects, as well as to keep debt off government books, but they need to be paid back, just as TransLink is doing with the Canada Line now.

As well, the 27 kilometres of light-rail lines running from Newton, Guildford and Langley to Surrey Centre would need an operating subsidy in the early years, since they aren’t projected to get enough ridership to break even for at least a decade.

Ms. Hepner said that in a perfect world she’d like to find a regional solution and she hasn’t given up hope that the provincial government might be persuaded to reallocate existing carbon-tax revenue to the Lower Mainland.

Other mayors said they had trouble seeing how Ms. Hepner could find the money just in Surrey to finance her city’s share of such a big capital project.

“I do not know how they’re going to do that,” said Richmond Mayor Malcolm Brodie.

Many mayors in the region are struggling to figure out what the consequences of the plebiscite failure will be for their part of the region.

Mr. Louie said Vancouver is looking at whether some of the costs of a local share could be covered through the city taking money from land-value increases along the line.

In Coquitlam, Mayor Richard Stewart says he’s stuck with the strange dilemma of having an expensive new SkyTrain line about to open, the Evergreen, but with no money available either to put in more buses to connect with the service or to build parking lots for the thousands of commuters.

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