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Tory promises $1B extra for transit

The Liberals committed to $17 billion in specific, GTA transit projects. Meanwhile, John Tory has suggested that he would gradually add $1 billion a year in spending on transportation, including roads, across the province.
 
rbt said:
You haven't been paying attention at all have you? That's okay, most people can't follow politics. They get caught up in the "obvious" components of the day and ignore the background noise, which of course is exactly what the parties want to happen.

Read the Liberal announcement and plans very carefully and you will quickly realize it has very little to do with public transit. That is the secondary goal.

The primary goal is to lock up the union vote.

Hints:
* It's P3 but big business, including banks, are not being invited to the table. The groups that have been invited to the table commented on the plan shortly after it was released.
* Immediate start on most projects. It takes a couple years to gear up.
* Interest rates tend to spike at the beginning of a decade.
* This is a long term (40+ year) investment with regular payments being made.

Lots of other benefits for them as well which will probably keep the lending rates low for the province so it can so P3 deals can work to the benefit of the province.

For homework, you can analyze and report back on the Ontario Conservative plan. I actually prefer it because it would benefit me personally (Conservative plans usually do) but I think the Liberal plan is better for the long term health of the province.
Click to expand...

I stand corrected, I made a few mistakes....

First it is $11.5 billion dollars for 52 specific projects (17.5 billion includes federal money). The projects will be completed over 12 years, while the costs of it will be paid over 50 years.

vs.

1.1 billion per year (plus inflation) - current value over the same 50 years is 55 billion (lets round it down since it does not all kick in upfront to 50 billion) dollars :eek: for unspecific projects that include both transit and roads.

But of course this is all just pre-election vote buying.

12-year, $17.5B transit pledge

Jun 15, 2007 12:00 PM
Canadian Press

The Ontario government is enticing voters with a 12-year, $17.5-billion plan to extend Toronto’s subway, expand GO Transit service and build two rapid transit lines across Hamilton.

The Liberal government says its MoveOntario 2020 plan would create 175,000 jobs and result in more than 900 kilometres of new or improved rapid transit in the Greater Toronto Area and Hamilton.

The plan wouldn’t get underway until after the upcoming provincial election in October.

It would see Toronto’s Yonge Street subway line extended to Highway 7, to go along with a previously announced extension of the Spadina subway line into York Region.

GO Transit’s busy Lakeshore line would be electrified, increasing train speeds and shaving 15 minutes off the travel time between Toronto and Hamilton.

Ontario, which would initially cover two-thirds of the plan’s cost with the cities picking up the balance, wants Ottawa to chip in a third of the total — about $5.8 billion.

The plan, which doesn’t include road tolls, is comprised of 52 projects that would be fully paid off over 50 years.
Click to expand...
 
"Where did you ever get the idea that they are borrowing that money and putting it in a trust?"

That is exactly what they said they would do. Borrow money now, pay back over 50 years.

It takes time to actually build all of these transit initiatives. Once cant simply start everything at once.
 
Again, where did it say it would borrow the money and put it in a trust.

Obviously if they are building over 12 years, and paying over 50 -- the money has to be borrowed (debt financing) [i.e. paid at the time the construction is done -- which is over 12 years] but where did this idea of a trust come from? Did they say they are going to issue 11.5 billion dollars of debt (bond issue)? Are they going to run an 11.5 billion dollar deficit (and put the money in trust)?
Where did this idea of a trust come from?
 
M I K E H A R R I S

Nuff said. Lets give the provincial Liberals a crack at their plan.
 
cacruden said:
Again, where did it say it would borrow the money and put it in a trust.
Click to expand...

I don't get the question. It's business as usual of course. They don't keep cash lying around in a Brinks truck. Once it is earmarked and on the books for a given fiscal year it has to go somewhere; otherwise it is surplus and goes against the debt.

Most inter-government transfers sit in the same type of account as the pension funds and other liquid government assets reside. That is to say, they loan the money back to themselves (another department) at a reasonable interest rate (operations budget instead of capital). An internally managed escrow or trust account available to the municipality on demand as soon as the "strings" or rules for withdrawal are satisfied.

A good chunk of government debt is owed to itself.

Heck, my personal budget even includes debt to owed to myself and I pay compounding interest on it. Great tool for determining actual profits on side ventures. The interest rate charged is usually the average rate of return for my traditional investments. Thus "actual profits" are always above and beyond what I would have made otherwise.
 
rbt,

Would it be possible to provide a link to the Liberal document in question? It sounds interesting.

Thanks.
 
The Liberals already increased the annual funding of transit form the gas tax by over $300 million a year, $150 million of which goes to Toronto. Of course this come close to how much the Tories took away from transit before that so I prefer the Liberals.
 
I thought you may have had a direct link to the government announcement.

Thanks.
 
rbt said:
I don't get the question. It's business as usual of course. They don't keep cash lying around in a Brinks truck. Once it is earmarked and on the books for a given fiscal year it has to go somewhere; otherwise it is surplus and goes against the debt.

Most inter-government transfers sit in the same type of account as the pension funds and other liquid government assets reside. That is to say, they loan the money back to themselves (another department) at a reasonable interest rate (operations budget instead of capital). An internally managed escrow or trust account available to the municipality on demand as soon as the "strings" or rules for withdrawal are satisfied.

A good chunk of government debt is owed to itself.

Heck, my personal budget even includes debt to owed to myself and I pay compounding interest on it. Great tool for determining actual profits on side ventures. The interest rate charged is usually the average rate of return for my traditional investments. Thus "actual profits" are always above and beyond what I would have made otherwise.
Click to expand...

The questions were because the line here was that this was somehow special that it could not be canceled because it was in trust. What I gather is that it is business as usual, and very little money has been committed (for this fiscal year) -- if any. So even if it was approved (which it is not), it is just as easy to cancel as any other government expenditure. The trueth though is that it is still just an election promise, no bill has been brought before the government legislature, no shovels are in the ground....

Although I don't expect the liberals to cancel the program if elected, I also do not expect them to keep the commitment as is. The time line will be lengthened, certain lines will disappear -- because of "financial considerations". But by that time, the promise would have succeeded in what it was designed to do -- get votes.
 
^I have a feeling that what you outline in your last paragraph is what will likely happen.
 
cacruden said:
So even if it was approved (which it is not), it is just as easy to cancel as any other government expenditure.
Click to expand...

Yes, that is the case.

In fact, I guarantee that the GTAA and municipal level EAs will modify and reprioritize the expenditures even if they are approved as is by the province.
 
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