More on OC Transpo and Bluesfest

On Thursday, I voted against the Transit budget – not an easy decision to make. But, there were several aspects to it that I disagree with.

I won’t go into great detail about continuing increases at the fare box. In the 2015 budget, I pushed back on those unsuccessfully (read more here). I applaud Councillor Tobi Nussbaum’s leadership on that issue this year and he has my support.

I also consider that the elimination of first and last trips from several routes will disproportionately affect people who most need transit – particularly those working in the service industries.

In this post, though, I’d like to take a closer look at the issue of charging special events a special fee to cover increased transit provision. In particular, I’m concerned about the proposal to charge Bluesfest $200,000 to cover increased transit. I last wrote about that here.

On Bluesfest specifically, I don't think the numbers add up.

When the proposal was first floated during the November 12 budget tabling, it was not clear to me that the proposal was to charge Bluesfest $200,000 and provide free transit to ticket-holders in return. It looked at the time like OC was going to lever the Special Events By-law to capture the costs of providing extra buses to the extent that those were higher than what OC would collect in new revenue. Riders would continue to pay their fares.

According to OC’s 2014 Annual Performance Report, tabled this May, extra service for Bluesfest cost the transit company $357,000. It received $153,000 in incremental revenue – a difference of $204,000.

Though I would have disagreed for all the reasons outlined in my earlier post, a simple charge to offset costs would have been coherent.

However, on Thursday, my question to staff at the budget meeting was whether, for $200,000, OC Transpo would provide free transit to Bluesfest ticket holders. And, I was told “yes”. This is a model that has worked well to get people on the bus for Redblacks games, and one that I can at least conceptually get behind. But, I am questioning the degree to which it makes sense at the proposed price point.

In 2014, if transit were free to ticket holders, OC Transpo would not have collected the reported incremental revenue. By charging just $200,000 against the total $357,000 cost, the taxpayer would continue have subsidized 44% of the additional cost.

I have since clarified with staff that the cost of providing additional buses for this year’s (2015’s) Bluesfest was just $285,000 (a roughly 20% reduction), and revenue just $87,000 (a roughly 43% reduction). Using those numbers, and removing the $87,000 in revenue that would presumably not come in since transit would be free for ticket-holders, Bluesfest’s $200,000 payment would cover 70% of the cost of extra buses, leaving the taxpayer to subsidize the other 30%.

(I’m not sure how to explain the large reduction in number of riders paying for a ride to the festival over the two years, or reduction in cost.)

If the intention is to ensure the taxpayer doesn’t subsidize increased transit service to a special event, why not charge the full $285,000 2015 cost if the proposal is to provide free service to ticket-holders?

I would also like to know more details about the Ottawa Sports and Entertainment Group’s arrangements with OC Transpo. I’m given to understand in casual conversation that all of the costs of providing extra service are recovered by OC Transpo. Unfortunately, the numbers aren’t reported in the Annual Performance Report.

If there are different treatments for different events, that should be ironed out. Presuming the City wants to go down a path of standardizing and making mandatory the same arrangements that it has with OSEG, we need (I shudder to recommend it) a policy. I’m open-minded to new revenue tools, of course. But, with respect to this new course:

• When will OC Transpo add additional service for special events?
• Are all events for which additional service is added to be treated the same, or are there categories?
• How will costs be calculated?
• Will different levels of subsidization be contemplated for different events?

And, my feeling is that the authority to mandate free-transit agreements should come from either a strengthened special events by-law, or from a specific by-law crafted more specifically for this. It’s not immediately evident that our special events by-law is the most appropriate way to impose these arrangements.

Overall, I continue to believe that, from a customer-facing perspective, mandating events to pay for the cost of the transit their patrons take is counter-intuitive. But, if that’s the path we’re going to go down, let’s at least make sure we have a coherent, Council-approved policy to guide that discussion.

The Transit budget passed the Commission on Thursday, and will be considered by Council on December 9.