A proposal to put a toll on each vehicle crossing the U.S. border is unpopular with cross-border shoppers, but researchers in Seattle calculate it could raise a significant amount of money.

Border toll could raise millions for TransLink

Advocate defends tax on U.S. entry but mayors steer clear

A Seattle think tank estimates a $5 toll on drivers crossing the U.S. border could raise $30 to $45 million a year for TransLink.

Researcher Clark Williams-Derry of the Sightline Institute crunched the numbers in response to a controversial proposal by Vancouver transportation planner Eric Doherty, who argued a border toll would raise new money to fund transit, help stop TransLink’s loss of gas tax money, reduce border congestion and deter cross-border shopping.

Williams-Derry estimated $38 million in revenue would be raised from a $2.50 toll charged each way at the five crossings from Point Roberts to Sumas, assuming 20 per cent fewer vehicles cross the border to buy gas as a result of the toll, with less dramatic decreases in other trips.

He said another $4 million could come from more fuel instead being bought in B.C., with 17 cents per litre in tax going directly to TransLink and another 10 cents collected by the federal government that also flows to TransLink for capital projects.

If Americans were exempted from the toll – something Doherty recommends so U.S. tourists aren’t dissuaded from coming north – Williams-Derry said the take from tolls might be 20 per cent less, as that’s the rough share of U.S. motorists crossing the border.

“For a transit agency scrambling for every dollar they can find, this would certainly be one way of shoring up their finances,” Williams-Derry said.

But he cautioned the extra revenue from border tolls might decline quickly if the Canadian dollar weakens further and makes cross-border shopping less of a bargain.

No B.C. politician is championing the notion of border tolls, which is deeply unpopular with the many Lower Mainland residents who regularly nip across the line to save money on gas and other goods.

But Doherty insists it deserves serious consideration.

He said it would be easy to implement – using the same electronic tolling system as the Golden Ears and Port Mann bridges – and would immediately inject new revenue to expand transit.

“Think of what that would fund for bus service south of the Fraser,” he said.

“I’d like to see us become a transit-oriented region instead of having this strange situation where people drive out of their way, burning gasoline to buy gasoline for a little bit cheaper.”

He said border tolls seem more logical to him that tolling all the region’s bridges.

Doherty admits tolls might prompt more drivers to head east to the Fraser Valley to refuel without paying the TransLink tax.

Tolls at the border would work best, he said, if they were applied not only at Metro Vancouver crossings for TransLink, but also at Abbotsford-Sumas, with revenue there funding transit projects chosen by the Fraser Valley Regional District.

He noted there’s demand for light rail to the Fraser Valley, and the FVRD is also wrestling with how to pay for an intercity express bus between Chilliwack, Abbotsford and Langley.

“They’ve got very many of the same problems that Metro Vancouver has,” Doherty said. “People want transit. They want HandyDart. They’ve got an aging population. It’s all the same situation.”

Abbotsford Mayor Bruce Banman said the idea doesn’t make sense to him.

“I just don’t think it’s going to fly,” he said, adding he’d prefer to seek ways to reduce gas taxes charged in B.C.

“I wonder if we would not be farther ahead to reduce those and convince people to stay home and spend their hard-earned dollars in Canada.”

North Vancouver District Mayor Richard Walton, chair of the Metro mayors’ council, opposes the border tolling idea.

Walton said he’s concerned it would create more anger and frustration toward TransLink and harm the chances of voters approving increased funding for transit in a promised referendum.

“You end up annoying more people who feel they’re getting chipped away at,” he said. “We’re already dealing with significant pushback.”

Walton is an advocate of a comprehensive system of road pricing, which he said could actually be used to reduce the gas tax in the region.

Drivers in Metro Vancouver pay about 49 cents per litre in combined gas taxes, compared to 15 cents in Washington State.

Transportation Minister Todd Stone was unavailable for comment but his staff issued a statement saying the province has no plans to toll highways leading to the border crossings, adding that would be inconsistent with B.C.’s current tolling policy.

 

U.S. has repeatedly eyed toll on incoming Canadians

Washington State business leaders have seen border tolls proposed before, but until now the idea has usually come from U.S. authorities.

Typically, it’s torpedoed almost as quickly as it surfaces.

The latest attempt came last spring, when the Department of Homeland Security said it would study the potential to slap a new fee on all pedestrians and vehicles entering the U.S. at land crossings from Canada or Mexico.

It was intended to generate more revenue as the department faced arbitrary staff cuts amid pressure to contain the ballooning U.S. deficit.

U.S. Senators from border states succeeded in derailing the toll.

“It’s been thwarted a couple of times,” said Bill Gorman, president and CEO of the Bellingham Chamber of Commerce. “Each time it’s been pretty adamantly opposed and stopped in Congress when it’s been raised.”

Gorman said he doubts a B.C.-imposed toll would do much to slow cross-border traffic.

“I think it would be more of a nuisance than anything else.”

He cautioned that such fees can hurt business and trade, which have both benefitted from an open border.

“Our economies are inextricably intertwined and important to each other. We don’t want anything to get in the way of that.”

 

BY THE NUMBERS

How does about $35 million in possible border tolls compare to other sources for TransLink?

– The two-cent per litre increase in the gas tax from 15 to 17 cents in 2012 generates an extra $40 million per year and covers TransLink’s $400-million share of the cost of building the Evergreen Line to Coquitlam.

– If $35 million was raised through a vehicle levy – one of the sources Metro mayors propose – it would equate to an annual fee of about $30 per car.

– TransLink’s main three revenue sources are fares, which cover 36 per cent of the $1.44 billion budget, followed by the gas tax at 23 per cent and property tax at 21 per cent. Most of the rest comes from senior government contributions, a pay parking tax, a B.C. Hydro levy and Golden Ears Bridge tolls.

| Infographics

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