$34M loss in final year rang death knell for STC

STC lost $34.2 million in its final year of operation.

The former Crown corporation ceased operations at the end of May after the province decided running a publicly owned bus company was not worth the cost.

“The difficult decision to wind up the organization was in response to declining ridership, the growing requirement for subsidies, and the belief that the dollars could be better directed to other government priorities,” Joe Hargrave, minister of Crown Investments Corporation, said in a release.

During the 2016-17 fiscal year, STC reported $14.9 million in revenue and $49.1 million in operating expenses.

It received $12.4 million in operating grants and $1.2 million in capital grants from the province.

“You know, it shows a substantial loss and it kind of shows the reasons why we had to take the actions that we’ve taken with the wind down of STC,” said Hargrave.

STC buses carried 185,678 passengers during that same time period, a drop of 2.4 per cent from the previous year.

According to the annual report released on Tuesday, 70 per cent of riders were low-income earners, with a higher per cent of youth and seniors falling in that category.

Over 2016-17, the ratio of passengers from rural areas increased. That change, according to the report, “indicated that ridership from major centres was decreasing at a greater rate than ridership from rural and small urban centres.”

The Highway Traffic Board has approved licences for some private carriers to operate bus services in the province; most of those companies will be operating along Highway 11, between the province’s two largest cities.

As part of STC winding down, a portion of its fleet that never went into service will be sold.

Last year, the company purchases three 16-passenger vehicles and one 22-passenger vehicle. When purchased, they were worth about $600,000 altogether. According to the Crown corporation’s annual report released Tuesday, “they were not deployed by the time of the announcement that STC would be wound up.”

Shawn Grice, president and CEO of STC, says “they are still with us and available for sale” and that “it’s still too early to know exactly what those assets will sell for.”

Hargrave said: “We want to make sure we maximize the revenue coming back from the sale of those assets for the people of Saskatchewan, so we’re not in a rush to do it, but we want to make sure we maximize the value.”

NDP Opposition MLA Carla Beck pointed out how different the 2016-17 annual report is from the previous year.

Last year’s report said: “STC provides citizens with access to essential services in larger and rural communities.”

Beck noted the Sask. Party government did not discuss the future of STC during the 2016 provincial election.

“Last year, when it was deemed an essential service, the revenues covered about 60 per cent of the total cost of the business.

“This year, it’s about 58 per cent. So, there is a slight decline in ridership, but again, there is a cost to not providing that service, as well,” Beck said.

She said more people are having to hitchhike to visit family or get to medical appointments as a result of STC no longer operating.

“People have always hitchhiked, and we don’t like to see that and hopefully they’ll stop doing that,” said Hargrave.

There are still 100 people working for STC at the depots in Regina and Saskatoon in order to see the end of a contract with Greyhound, which wraps up in September.