Regional transit governance has been in the news within the last year and it is my time to chime in. It has been over a year since The Toronto Board of Trade released a proposal on the formation of a new regional transit agency loosely defined as Superlinx. The paper outlines a regional transit governance structure with boundaries in the Greater Golden Horseshoe (GGH) rather than the Greater Toronto and Hamilton Area (GTHA). Now that GO Transit commuter bus and rail extends to Niagara, Waterloo and Kawartha Lakes Regions, it only makes sense to have a new governance structure defined as such.
The TRBOT report included a suggestion that the Toronto Transit Commission’s (TTC) subway system is uploaded to the province which has led to speculations that the operations and funding of the subway could be privatized. This aspect of the paper seems to be the playbook of the current provincial government led by the Progressive Conservative government and the populist right-leaning business minded Doug Ford. While the governance structure outlined in the paper is commendable and worth seriously considering, the funding and operations frameworks are left to be desired.
This post intends to present a different multi-pronged approach to regional transit governance in the GGH. The first part of my post will define a system thinking approach as a starting point. Understanding that the discussion is around how Metrolinx is currently governed, I will look at the governance and funding structures of different agencies: Translink in the Metro Vancouver area, the Metropolitan Transportation Commission in the San Francisco region and the Regional Transit Authority in Greater Chicago. Finally, there will be a recommendation on how a future Metrolinx should be governed based on the available research and the current political environment.
From an organizational perspective, cross-jurisdictional local transit service is currently done from a transactional perspective. If a true regional governance structure including operations is to be completed, a transformational leadership approach would be necessary. Human capital, labour agreements and infrastructure would be affected and a vital next step, those are beyond the scope of this post but stated as a recommendation later.
Systems thinking is recognized as an effective approach to help organizations make sense of the interconnectedness of systems and develop solutions that are effective, long lasting, and sustainable. Systems thinking focuses on the organization as a whole; interactions between parts; the way systems affect other systems; recurring patterns over individual events; change over time; and, how feedback affects the parts.
Applying system thinking to organizational development issues are driven by four reasons. First, financial constraints and budget cuts mean there is a greater need to pool resources. Lower tax revenues have precipitated this. Similarly, these cuts have led to organizational consolidations and therefore there is a need to understand the interconnections and interdependence to structures. Silos are broken down and horizontal integration is required for success. Collaboration becomes relevant.
Second, as mentioned earlier human capital is affected. Not only attrition becomes prevalent but leaner staff will understand how all the pieces fit together. Similarly, diverse opinions become prevalent with in-depth knowledge of broader, interconnected tasks. Systems thinking uses this type of approach to its advantage.
Third, with systems thinking it allows organizations to get ahead of the game with proactive thinking. It allows for a deeper and more accurate examination of the issues so that the problems are addressed and dollars are spent smartly.
Fourth, systems thinking would provide for a greater push for innovation in how organizations, departments, and services would be led, managed and delivered. There would be a greater likelihood that all stakeholders would accept the resulting solutions.
Comparative transit systems
Instead of saying what’s been already said about Metrolinx’s governance and funding, I will dive right into comparing regional transit structures. In this section, three regional transit governance structures will be reviewed as a matter of context and comparison: TransLink in the Greater Vancouver Area, Metropolitan Planning Commission in the San Francisco Bay Area and the Regional Transit Authority in Chicago.
In 2014, the BC Provincial Government passed into legislation the current TransLink governance structure. A more detailed description of Translink’s governance can be found here. An organizational chart cannot be found so I will summarize their Board Governance here:
An independent Screening Panel that has one member appointed from the Greater Vancouver Gateway Society, Chartered Professional Accountants of British Columbia, Mayors’ Council on Regional Transportation, Minister Responsible for TransLink and the Vancouver Board of Trade.
The Mayors’ Council on Regional Transportation is comprised of the 21 Mayors in Metro Vancouver, Tsawwassen First Nation, and an elected representative from Electoral District A.
The various responsibilities for this Council include appointing the Mayor’s Council Chair and Vice Chair, approving long-range transportation plans and investment plans, and oversees the sale of major facilities and assets.
The TransLink Board of Directors appoints the Translink Chair, Vice Chair and CEO, submits long-range transportation strategies and the 10-year transportation investment plan, and, approves TransLink’s annual operating budgets. The CEO, the Provincial Government and Metro Vancouver round out the governance structure.
The “other” revenues come from senior levels of government, parking, tolls, taxes and the Canada Line which is operated independently from the rest of the transit system.
Under Translink’s purview within Metro Vancouver, they operate the BC Rapid Transit Corporation (Sky Train), The Coast Mountain Bus Company (bus and ferry), Transit Police and the West Coast Express (Commuter Rail). Translink is one regional transit operator with a service area covers 21 municipalities, one treaty and one electoral district totalling nearly 2900 square kilometres. Transportation planning is divided by subregions or districts which then are incorporated into the regional plan and 10-year vision.
Chicago’s Regional Transit Authority
From the RTA’s About us page:
The RTA is charged with financial oversight, funding, and regional transit planning for the region’s transit operators or Service Boards: the Chicago Transit Authority (CTA), Metra and Pace Suburban Bus and Pace Americans with Disabilities Act (ADA) Paratransit. The RTA regional system serves two million riders each weekday in six counties with 7,200 transit route miles (11587 kms) throughout Northeastern Illinois. The RTA sales tax is expected to yield $1.2 billion in 2017. With the addition of state monies, the RTA is expected to distribute about $1.5 billion of public funding to the region’s transit operations this year. In addition, the RTA manages a $5 billion five-year capital program that includes issuing hundreds of millions of dollars in RTA bonds and administering grants to the Service Boards.
Three major operators provide the vast amount of service in the Chicago Region – Chicago Transit Authority (CTA), Pace Suburban bus and specialized transit and METRA commuter rail. Each of these services are independent of each other and fall under the umbrella of the RTA. The RTA, has very little statutory power and its primary functions are to provide funding based on fixed formulas and approved budgets.
According to Eno Transportation’s report on Transit Governance, the RTA’s funding formula has been skeptical at best. While a little of 1/5 of funding is discretionary, much of it goes to the CTA with Metra and PACE receiving very negligible amounts. Transit funding has had many challenges with decentralization and fragmentation in terms of governance of transit services there is a distrust between the city and suburbs. The region’s transit deficits have been in large part due to its governance structure.
In addition there has been a lack of engagement with the Illinois State government. As noted in this 2018 YouTube video Talking Transit: Exploring the Economic Backbone Of Our Region.
State Infrastructure funding has been non-existent for the last 10 years including recent state cuts. 40 % of funding comes from the local sales tax, 40% from the fare box, only 19% comes from the state and the rest come from other local governments. In 2017, the RTA requested that the CTA come up with additional funding sources which included a fare increase, with which PACE and Metra did. The state budget passed in that year imposed a 2 percent sales tax surcharge plus a 10 percent cut in public transportation funds on the transit agencies. These cuts combined with sluggish sales tax growth will add up to 2018 funding losses for the CTA, Metra and Pace. For the CTA alone, the loss is over $33 million. When the state’s largest region is largely away from its capital in Springfield, and their Department is mainly a highway agency, therein lies the further disconnect between state legislators from other local municipalities.
San Francisco Bay Area – Metropolitan Planning Commission (MTC)
The MTC is rather unique. The structure of the Metropolitan Transportation Commission (MTC) operates on a strong Metropolitan Planning Organization (MPO model) that is responsible for regional planning, coordinating and financing transit in the Bay Area.
Their Governance Structure is as follows:
Governance is extremely complex where some of the board members are appointed, with varying degrees of complexity, BART and AC transit have board members directly elected.
It is responsible for distributing funding for 26 different transit agencies including San Francisco’s MTA, BART and AC Transit. The agencies are responsible for their own planning and operations, similar to that of those in Toronto and Chicago regions. These powers have been statutorily transferred from the California Legislature. MTC wields the authority to distribute significant funding to transit investments.
The regional transit network is fragmented and disorganized even with the introduction of the Clipper Card, their regional fare card. Fare integration is non-existent. Each of the 26 operators has separate fare structures which makes the system cumbersome to use.
In 1971, California’s Transportation Development Act (TDA) created both the Local Transportation Fund (LTF) and the State Transit Assistance Fund (STA), both of which are distributed by MTC for the Bay Area. The LTF is a quarter percent general sales tax that is levied statewide; the STA, which is also levied statewide, is a gas tax. MTC must distribute LTF funds back to the county from which they originated, but—importantly— MTC retains discretion over which agency within the county receives the funds. STA funds are distributed based on a formula that is 50 percent based on population, and 50 percent based on operating revenues from the prior fiscal year. Of the total revenues collected under the TDA, MTC retains 3.5 percent for administrative support. Since there are counties with more than one system the MTC can allocate funds to agencies at their own discretion and not by funding formulas. Therefore equitable distribution is a concern for the region’s transit agencies.
Strategies for Success
In implementing a system thinking approach, transformational leadership principles should be applied. Transit operators, for the most part, have applied transactional leadership principles when dealing with memorandums of understanding and service agreements for examples. Transformational leadership works with teams to identify needed change and create a vision through guiding change through inspiration and executing change collaboratively with group members (ask me about my 2015 paper on Transformational Leadership and Transit Regionalization).
In 2011, the Transit Cooperative Research Program conducted a report Regional Organization Models for Public Transportation. The outlined strategies for successful organizational transformation. They include:
- Every region is unique and precise governance choices must fit.
- Recognize and capitalize on windows of opportunity for governance change.
- Governance and finance are interrelated and must be addressed in tandem.
- There must be patience when governance change takes place.
- Leadership and champions are critical to change in governance.
- Advocacy groups can be helpful. In this case, the Board of Trade is that group but others must be involved.
- Good working relationships with other agencies are critical to a successful transformation.
Knowing these points, how should a new Metrolinx look?
Each regional system mentioned has its benefits and drawbacks. Within the Greater Golden Horseshoe, 12 local agencies operate separately with minimal coordination. Fare integration occurs within the outer suburbs and a co-pay exists between TTC, the outer suburban systems and GO Transit. It is a convoluted system, but not a bad as the one that exists in the San Francisco Bay Area. Federal and provincial funding is based on local property taxes, a portion of the gas tax and discretionary federal and provincial contributions which tend to be politically driven.
Here are my recommendations:
A new Metrolinx will oversee a three-tier transit system similar to that of Chicago’s Regional Transit Authority. It is recommended that suburban local bus services in Peel, York, Durham, Hamilton, Niagara, Peterborough, Waterloo and Guelph should amalgamate into one system. Similar to TransLink, subregional transit operations should be divided into North, West, and East. Commuter bus services will be transferred from GO Transit to the suburban municipalities and rail operations will remain with GO Transit. TTC’s local transit operations of all modes will remain with the City of Toronto with the exception of cross-boundary service where cost sharing will continue.
The Province of Ontario should transfer financial responsibility of transit operations and infrastructure to Metrolinx. This is similar to that of Chicago’s Regional Transit Authority, TransLink and the Metropolitan Planning Commission. Allow for special taxation powers and revenue tools outlined in Metrolinx’s Investment Strategy in 2013.
Further to Recommendations 1 and 2, and similar to RTA and MTC, regional funding should be the responsibility of Metrolinx and redistributed with an agreed upon funding formula for transit operations. Unsustainable discretionary funding from senior levels of government should not continue. The federal government should reconsider using revenues from the carbon tax to fund transit infrastructure instead of the revenue-neutral option.
Governance of the new Metrolinx and local transit systems should include the following:
a. Suburban local systems will have one elected member appointed from each municipality. If a former transit operation was regional then 1 board member represents the new Board – 13 members.
b. TTC Board remains the same.
c. The overarching Metrolinx Board has a mixed Executive with 5 from appointed from the City of Toronto, 5 from the suburban Board and 5 public appointees. Voting would be 1:1.
Human Capital and Infrastructure Strategies should be completed to address labour agreements and human capital needs regarding administrative and operational staff and capital such as bus and rail fleet and garages.
I commend the Toronto Region Board of Trade for commencing the discussion. The topic of regional transit governance has been on my mind for over 20 years but I never had the voice. The political environment may not be ripe for this change, but something needs to be done. My recommendations are a compromise between the parochial voices within Toronto’s boundaries and the Board of Trade. While this may be a rushed post and needs further refinement, a fruitful discussion is necessary on this topic. A new Metrolinx is necessary and the time is now!