This week Ottawa’s Transit Commission has an opportunity to take more concrete action on providing more affordable transit passes for people living with low-income in that city.
Currently OC Transpo provides reduced fares through the following programs:
- The Community Pass, with a discount of 60 per cent from the regular fare;
- Seniors’ fares, at a discount of 24 to 60 percent and with free travel on Wednesdays;
- Student passes, at a discount of 20 to 24 percent, as well as the U-Pass, which can be purchased through a university or college.
Two proposals were prepared by Ottawa city staff and presented to the Transit Commission.
The first proposal would provide a 24 per cent reduction in transit fare costs (similar to student reduction). The second proposal would provide a reduction of 62 per cent (similar to the seniors’ reduction).
About 15 per cent of the population in Ottawa has incomes below the low-income cutoff (LICO), which is $23,861 before tax for a single person living in Ottawa, and $44,340 for a family of four.
Two cost estimates were presented. The first extending these fare subsidies to all individuals with income below the LICO, and the second which excluded people who are receiving Ontario Works (who receive transit subsidies in limited circumstances) were presented.
City staff estimated the cost of a 62 per cent reduction in the price of a monthly pass to be $8.3 million, if everyone living with low income was deemed eligible, regardless of the source of their income.
That cost represents only 0.26 per cent of Ottawa’s 2016 budget — 0.56 per cent of Ottawa’s 2016 property tax revenues. In other words, it’s a drop in the bucket for the municipality to pay for this type of smart policy.
The healthy transportation coalition has developed a petition in support of increased access to transit for people living with low income.
A policy like this would have a very small impact on the city’s finances. However, it has the potential to have a large, positive impact on the life of Ottawa residents who already face many challenges and barriers.
The Transit Commission considered these proposals late last month and has asked the Ontario government to fund this reduction in costs.
Councillor Jeff Leiper wants the Transit Commission to come to the meeting this week with proposals on funding this pass within the OC Transpo budget.
However, there is a third option. The cost of these reduced fares could be funded through the city’s budget. This would spread the cost over a wider range of residents. And there is precedence for this type of municipal leadership.
Ontario municipalities that provide transit pass subsidies do not rely on their transit budget to fund them. They are funded from other tax revenues, including municipal tax levies, gas tax revenues, or reserve funds.
The City of Toronto is in the process of developing a transit fare equity policy and it has ruled out funding it through existing transit revenues.
Recognizing a body of research that shows the cost of transit remains a significant barrier for people with low incomes, a number of municipalities in Canada have introduced discounted transit passes.
If the City of Ottawa chooses to go this route, it will join these Ontario cities that have introduced low-income transit passes: Waterloo, Hamilton, Kingston, Windsor, York Region, and Guelph.
Other cities in Ontario have proven that it can be done on the municipality’s dime.
Shifting the buck to the province to delay action shouldn’t be the only option before Ottawa city council this week.
And cost shouldn’t be the excuse of continued inaction.
Sheila Block is a senior economist with the Canadian Centre for Policy Alternatives’ Ontario office. Follow Sheila on Twitter: @SheilaBlockTO.