Pricing Road Infrastructure

One reason that Canadian roadways, highways and cities suffer from congestion is that infrastructure projects that increase traffic volumes qualify for federal funding, resulting in a subsidy that favours private vehicle dependency, while use of roads is for the most part unpriced. Users do not pay for pollution they emit, the GHG emissions or the costs they impose on other users by adding to the total volume of traffic, or for their role in exacerbating congestion. Low density developments and the growth of suburbs and exurbs result in ever increasing demand for new investments in roads, yet frequently as soon as the roads are built or expanded, traffic volumes increase, often negating the rationale for the investments. However, COVID-19 has forced companies and communities to rethink how work is carried out and the need to commute to downtown office spaces. Much of the revenue earned by municipalities comes from sources that can have the perverse effect of encouraging municipal leaders to embrace sprawl: gas taxes, development charges and property taxes. Outside of North America, many highways are tolled and a number of cities such as London and Milan have reduced congestion, addressed GHG emissions and improved air quality through road pricing and congestion charges.

The Green Budget Coalition recommends that the federal government:

  • Work with provinces and territories to restructure infrastructure funding mechanisms for municipalities to better align incentives with smart growth principles;
  • Support municipal efforts (such as the City of Vancouver) to advance mobility pricing via special grants to support studies;
  • Undertake a comprehensive review of budgetary and regulatory mechanisms to ensure that a climate lens and demand side management is incorporated into roads built with federal support; and
  • Make ineligible for federal funding road projects or other transportation infrastructure that will lock-in or exacerbate pollution, GHG emissions and loss of natural habitat.

•   $5 million [INFC]

Tom Green –