Impose user fees to fund infrastructure, report urges

OTTAWA — It’s time for the federal government to start making Canadians pay user fees to pay for infrastructure upgrades and renewal, a report released Wednesday urges.

The controversial concept in a paper done for the University of Calgary’s school of public policy is effectively advocating for a pay- as- you- go system to pay for renovations to infrastructure, such as roads, bridges, ferries and railways.

Tax dollars or some user fees cover the costs of replacing or repairing local, provincial and nationally controlled infrastructure, but the backlog of repairs is so vast — estimated to be in the billions of dollars — that taxes alone may not be enough to pay for it all.

Convincing Canadians to start paying user fees will be a “phenomenally difficult political economic exercise,” said Brian Flemming, a transportation expert from the university’s school of public policy who wrote the report.

A successful pitch, he said, will require governments to be open and transparent with their plans — a tall task for what Flemming describes as “the most secretive and controlling government in Canadian history.”

The need to charge user fees is being driven by the retreat of the federal government from stimulus spending as Ottawa attempts to cut the federal deficit.

Flemming argues user fees and an even more controversial concept — public- private partnerships including allowing people to invest their pensions in infrastructure projects through “infrastructure banks” — are one way to fill the financial gap left by the end of stimulus spending. A second driver is climate change. Flemming argues green technologies in vehicles that decrease the need for oil will, eventually, dry up the one line of infrastructure financing the federal government provides to cities: the gas tax.

“The shrinking of the gas tax base is being recognized everywhere, even by states and the federal government in the United States,” Flemming writes. “That decline is already pushing people in other parts of the world towards other revenue sources, such as road pricing, more sophisticated tolling or congestion charging.”

Charging tolls or road fees has become a norm in other countries, such as the United States and in Europe, including Britain where cars entering downtown London are charged a congestion fee to enter the core.

“Only some form of road pricing will fill the coming shortfall in funding,” Flemming said.