Most road costs covered: study
OTTAWA, Ont.—A new study by the Conference Board of Canada attempts to dispel the notion that motorists are being heavily-subsidized by the taxpayer.
The report, issued today, found that in Ontario at least, fuel taxes and other fees paid by motorists cover 70-90 percent of annual road construction, maintenance, and policing costs.
The study—paid for by the Canadian Automobile Association South Central Ontario—focused on light-duty vehicles such as cars, minivans, sport utility vehicles, and light pickup trucks.
“This comprehensive study sheds new light on the common misconception that road users in Ontario are heavily-subsidized,” said Teresa Di Felice, director of government and community relations for CAA SCO.
“Before any decisions can be made about new revenue tools [tolls, taxes, and increased fees], it is essential to understand who pays for our road network,” Di Felice said in a statement.
Vijay Gill, the Conference Board’s director of policy research, said one of the major challenges in addressing traffic congestion is determining who should pay the costs of additional road infrastructure.
“Virtually all the discussion about congestion is related to the presumption that users of the road infrastructure are heavily-subsidized by all taxpayers,” Gill noted.
“The findings of this report don’t remove policy options such as congestion charges from consideration,” he added.
“They do, however, shed new light on the conventional wisdom about who pays for road infrastructure.”
Province-wide, road network-related revenues from fuel taxes, licence fees, and other sources totalled more than $7.5 billion annually between 2008 and 2010—the latest year with available data.
These revenues covered 70-90 percent of annual road costs, depending on the method used to calculate infrastructure expenditures.
Revenues collected from motorists in the Greater Toronto and Hamilton Area in the same years totalled almost $1 billion annually, more than the yearly cost of the road network in the region.
However, the study noted that local governments, which own and maintain a large part of the infrastructure, collect a relatively small portion of the revenues related to road use.
Vehicle ownership and maintenance costs also were not included in the results as they are paid for directly by motorists, although estimates of those costs can be found in the report.
Social costs—from accidents, congestion, greenhouse gas emissions, and criteria air contaminants—also were not included in the main calculations.