Dear Winnipeg

A Fun Blog About Infrastructure and Municipal Finance

An Inconvenient Truth: ALL Transportation is Subsidized

Dear Winnipeg,

Sorry it’s been a while since I last wrote you. But to be honest, you’ve been kind of a jerk lately… you’ve let your relatives continue to outdo you at every chance they get!

First you lose at library-ing to Halifax, Calgary and Virginia. [Library-ing is probably a word? If not, it should be.]

Then you lose at hockey-ing to your cousin St. Louis. [That one stings.]

And now you’re losing at public transit-ing to your sister Victoria. [Plus, did you know she has a Bug Zoo? I know!]

In case you haven’t heard, while you’ve been tinkering with the idea of phasing in a low-income bus pass, she’s seriously upped her game by voting to eliminate ALL bus fares for everyone. [Whaaa?? Sounds to me like you just got pwned!]

“But wait”, you say. “I’m broke. I can’t afford to go around subsidizing everyone’s transportation!”

But wait, I’m broke. I can’t afford to go around subsidizing everyone’s transportation!

— You, just now.

And you’d be right. Except for the inconvenient fact that you’re already doing it. For everyone.

Pedestrians, cyclists, transit riders, even cars.

I can tell that I lost you at cars.

Understanding the subsidies to pedestrians and cyclists seems pretty intuitive… none of them ever pay directly to use the sidewalks and bike paths around here (which aren’t free). So clearly they are being subsidized on the public dime.

Ditto for transit users. You have to contribute about $55 million every year to make up the gap from transit fares. Not to mention the other $50 million thrown in from the Province. The $105 million subsidy here is pretty easy to spot.

But cars?

Drivers cover their driver’s license, insurance, maintenance, loan payments and fuel. And not to mention the cost of roads through a little thing called the gas tax! Surely travel by car is the only mode of transportation that covers all of its costs without public subsidies?

I hate to be the one to break it to you, but nope. It’s subsidized just like all the rest.

To the math-mobile, Robin! [Na-na-na-na-na-na-na-na-Na-na-na-na-na-na-na-na-Mathman!]

[Don’t bother Googling it. It’s not as cool a car as you think it would be.]

Subsidies to pedestrians [TLDR: $0.24 per trip]

There are 3,100 km of sidewalks in the city, which have, if we’re anything like Edmonton, a replacement cost of about $112,000 per km. At 4% per year, that means we need about $14 million annually just for capital replacement. Spread across the over 57 million annual pedestrian trips in the city, you get a pedestrian subsidy of about $0.24 per trip. [Those mooches!]

Subsidies to cyclists [TLDR: $0.31 per trip]

There are (apparently) 274 km of cycling paths in the city. Valuing them at the same approximate replacement cost as sidewalks means an annual replacement cost of about $1.2 million, spread over about 4 million annual bike trips, which comes to a cyclist subsidy of $0.31 per trip. [Eeesh! They’re even worse than the pedestrians!]

Subsidies to transit riders [TLDR: $2.18 per trip]

This one’s easy. $55 million from the City + $50 million from the Province, divided by just over 48 million annual rides comes to a transit subsidy of $2.18 per trip. [Gasp!]

Subsidies to car users [TLDR: $4.09++ per trip]

We have $15.6 Billion of roads and bridges, meaning an annual capital replacement cost of $624 million. In Manitoba, the gas tax is $0.10 per litre (Federal) and $0.14 (Provincial), for a total of $0.24 per litre. The best-selling vehicle in Canada, the Ford F-150, gets 12 L/100 km in city-driving fuel economy (if you can call it that). The number 3 vehicle, the Honda Civic, get 8 L / 100 km. So let’s split the difference and use 10 L / 100 km. Given the 5.18 Billion annual kilometers driven by Winnipeggers, that means $124 million is collected in gas tax on the over 517 million litres of fuel consumed every year in the city.

That leaves the public purse to cover the $500 million annual shortfall for road replacement. That’s nearly $1.00 per litre of gas, or $0.10 per km. [A $0.04 per litre carbon tax doesn’t sound so bad now, does it?]

Since the average Winnipegger likely puts over 15,000 km on their vehicle every year, that’s an annual subsidy of $1,500 per car. Just for the capital replacement of roads.

But there’s more. [You had to know there was.]

The Canadian oil industry receives approximately $3.3 Billion in government subsidies per year in order to extract 1.533 Billion barrels of crude oil, close to $2.15 per barrel. One barrel produces about 75 litres of motor fuel. That translates to an additional subsidy of somewhere around $0.03 per litre of gas. [Coincidentally, that almost covers the carbon tax.]

So where does that put us so far? About $128.75 per month. [By the way, a monthly bus pass costs $100.10. Just sayin’.]

But that’s not all. There’s also all the free parking. [You’re allowed to store your personal property on public land at no cost to you, land that could have been put to a more productive use… which is apparently fine for your car, but none of the other stuff you own, so yeah, that’s a direct subsidy to car drivers.]

What’s the cost of THAT subsidy? Well, we can save that discussion for another time, but spoiler alert: it’s HUGE. [I know, I bet you can’t wait.]

OK, you convinced me, here’s a preview:

A car is parked 8,260 hours per year (15,000 km driven per year at an average speed of 30 km/h means 500 hours spent driving, or not quite 1.5 hours per day). Let’s say 12 hours a day, it’s parked at your house where, presumably, you’re bearing all the costs. That still leaves 3,880 hours where your car is parked NOT at home. At, say $1/hr (which is the lowest parking meter rate I’ve ever seen), that’s $3,880 in annual parking value. [There’s no such thing as a free lunch. If you’re not paying, someone else most definitely is.]

Ok, say you DO pay for parking at work, $100 a month. You’re still getting $2,680 in subsidized parking per year.

Total subsidy to drivers so far: $4,225 per year. Divide that by the 2.83 daily trips per Winnipegger for a per-trip subsidy to car driving of $4.09.

And we haven’t even touched on any of the social, environmental or other costs.

So to recap:

2019 cost estimates displayed with a whimsical old-timey feel!

If you start reading here again, you’ll have skipped all the math

So yeah, ALL transportation is subsidized. Some more than others. And, shocker, it isn’t the ones we thought.

So now that we have all that out of the way, can we please start having a real adult conversation about which mode subsidies are giving us the best bang for our buck?

Talk soon,

Elmwood Guy