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The mid-December announcement by Caisse de dépôt et placement du Québec that it would extend its Réseau express métropolitain project, currently under construction, to the eastern tip of the island of Montreal was like an early Christmas present for long-neglected neighbourhoods that have languished in the wake of deindustrialization.

Rather than playing Santa Claus, however, the Caisse sees the project as a way to earn rich returns for its depositors, which include the Quebec Pension Plan, at a time when its other real holdings in shopping centres and office buildings face uncertain postpandemic prospects.

Whether this model of transit development is a good deal for residents and taxpayers is another matter altogether. Critics argue the Caisse has put its own interests ahead of those of the broader community by pushing governments to hand it control over major infrastructure without facing the same requirements for transparency as public transit agencies.

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The $10-billion project unveiled last month, dubbed the REM de l’Est, would run for 32 kilometres from downtown to points in Montreal-Nord and Pointe-aux-Trembles. The project would be aimed at relieving congestion at downtown subway stations and encouraging the redevelopment of vast swaths abandoned industrial land in the city’s east end.

We are putting forward a public transit system proposal that meets both the needs of [the Caisse’s] six million depositors, and the need for mobility in the eastern and northeastern sectors of the island,” Caisse chief executive officer Charles Émond said at the Dec. 15 unveiling of the REM de l’Est alongside Premier François Legault and Montreal Mayor Valérie Plante. “We call this constructive capital, since it allows us to combine performance and progress.”

The new project would be separate from the REM already under construction, with its three lines running 67 km west, north and south from downtown and a link to Trudeau International Airport. Budgeted in 2016 at $6.3-billion, the REM is behind schedule and the final cost is expected to exceed $8-billion once reinforcements of a century-old tunnel under Mount Royal and other municipal infrastructure improvements are taken into account. Most of the additional costs are likely to be borne by taxpayers, rather than the Caisse.

Like the REM, however, the REM de l’Est would be majority-owned and operated by the Caisse, which would put up about half of the cost of the project. The federal and Quebec governments would provide the remaining capital for project. The Caisse would receive annual operating subsidies from Quebec City and local municipalities to help meet its “profit” targets.

Under its 2018 financing agreement for the REM, the Caisse will receive 72 cents for each passenger-kilometre travelled on the light-rail transit system, with most of the funding coming from the provincial government (39.5 cents) and local municipal governments (11.4 cents). As with most public transit projects, ticket prices will cover only a fraction of the cost of the service.

The REM de l’Est would likely need much larger per-passenger operating subsidies, since much of the LRT’s trajectory would run through sparsely populated neighbourhoods whose redevelopment would occur over several decades.

If the Quebec government has been an enthusiastic supporter of the Caisse’s vision, it is at least in part because of its own inertia. Long-promised plans to extend Montréal’s underground Métro system remain unrealized. Regional and local transit authorities are bogged down by bureaucracy, while the costs of maintaining existing transit infrastructure suck up their budgets. The result is rundown Métro stations and an exodus of young families to the suburbs.

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At this point, the REM de l’Est appears to be more of an election promise by Ms. Plante and Mr. Legault – who will face voters later this year and in 2022, respectively – than a done deal. The promise allows Ms. Plante to claim credit for securing major transit investments for the city’s hard-up east end, while improving Mr. Legault’s chances of picking up more Montreal seats. The Premier’s Coalition Avenir Québec currently holds just two seats on the island of Montreal. One of those seats just happens to be Pointe-aux-Trembles, held by junior transportation minister Chantal Rouleau, whose riding would be the end point for the REM de l’Est.

Many urban planners worry the Caisse has shown heavy-handedness in imposing its vision for Montreal’s transit future in order to guarantee returns for its depositors, without regard for the efforts of regional public transit authorities to work in concert. Indeed, both the REM and REM de l’Est could endanger the viability of existing transit systems operated by the Société de transport de Montréal and l’Autorité régionale de transport métropolitain.

Perhaps the biggest knock against the REM de l’Est is that the proposed LRT would run on elevated tracks five metres above ground along René-Lévesque Boulevard, through the downtown core. While this is a cheaper option than an underground train, the massive concrete columns running down the middle of a major thoroughfare would be a colossal eyesore.

The Caisse has promised that the “elevated structure and stations will receive special attention in their architectural treatment, to ensure they endow downtown Montréal with a modern and symbolic aesthetic.” But judging by the portions of the REM already under construction in the city’s west end, aesthetics do not appear to the be the Caisse’s main priority.

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