Metro Vancouver may be hit with a second carbon tax

Lekstrom says Victoria won't share existing tax flow with TransLink

Any move to fund TransLink expansion with carbon tax revenue would be by creating a new “regional carbon tax” that would be charged in addition to the existing one, according to Transportation Minister Blair Lekstrom.

He was responding to NDP questions in the legislature last week after Premier Christy Clark indicated the government would consider using a share of carbon tax revenues – a longstanding request from the regional mayors council.

Lekstrom, however, said the province won’t share revenue now collected through the current carbon tax but would instead consider creating a second Metro Vancouver-only version.

“This would be on top of the existing one,” Lekstrom said, adding the “regional carbon tax levy” could be one of a bundle of funding options the mayors may propose for TransLink to avoid raising property taxes further.

Area cities are united in seeking much more money for TransLink to fund not just the region’s $400-million share of the stalled Evergreen Line but also additional rapid transit lines and other priorities for expansion.

Lekstrom said the existing carbon tax is fully committed by legislation to offsetting tax relief, so there’s no legal mechanism for it to be shared.

B.C.’s carbon tax, now at 4.45 cents on gasoline, rises to 5.56 cents July 1 and 6.67 cents in mid-2012.

It currently raises about $1.1 billion a year, with close to 40 per cent of that coming from the Lower Mainland.

That’s significantly more than the $325 million TransLink raises from its 15-cent-a-litre gas tax in the region because the carbon tax also applies on home heating and industrial fuels.

Mayors council chair Richard Walton said he’s not sure whether the regional carbon tax contemplated by the province would also cover home heating, but said that makes sense, as otherwise TransLink could simply raise its existing fuel tax if motorists were to be the sole target.

Lekstrom did not make it clear whether the province could split off the next two increases in the carbon tax levied on Metro residents for TransLink.

But Walton said it seems improbable.

“Those lifts are in existing legislation,” he said. “I would find it highly unlikely. It would require new legislation and the next session of government could be 10 months away.”

NDP transportation critic Harry Bains said the province should have suspended tax breaks to corporations effective Jan. 1 so that at least the pending increases in the carbon tax could go to TransLink.

“This is a surprise they’re throwing at the public,” he said of a second carbon tax.

He also said the province should trust that the funding impasse with the region will be resolved and initiate the construction of the Evergreen Line now.

“The government has to show leadership,” Bains said. “Just because the mayors cannot agree on something doesn’t mean the people on the ground level in the northeast sector do not deserve that line.”

Lekstrom told a legislative committee Monday the long-delayed SkyTrain extension from Burnaby to Port Moody and Coquitlam won’t be open to riders before late in 2015 at the earliest.

He said the province won’t put the $1.4-billion Evergreen Line out to tender until there’s a deal with the mayors council to fund TransLink’s share.

That’s because it takes a minimum four years to build and there’s no contract yet finalized with three short-listed bidders from an original seven that responded to a request for qualifications 10 months ago, Lekstrom said.

He warned a longer delay could put the procurement process at risk and result in even longer delays if the remaining bidders give up waiting for the project to go to tender and drop out.

“We’re very fortunate that those three have hung on. I don’t know how long they will hang on.”

What happens next is up to the mayors, Lekstrom said.

“The ball is really in their court,” he said, adding the province won’t be putting up money beyond its $410-million commitment or launching the project without the cities on board.

“My goal is to have, first, the Evergreen dealt with, and then the longer-range plan, obviously, is to find a solution so that we’re not back dealing with one-offs, whether it be the UBC line or any of the others,” Lekstrom said.

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