Higher fares or cuts to service? That's the choice the London Transit Commission may soon have to make if it's forced to hold the line on the city’s budget target for next year.
The commission will get its first look at the plan on Wednesday, but according to the draft budget, council's target doesn't even come close to allowing them to maintain the service they provide now.
So hitting the mandated target could mean cuts to routes, a loss of riders and an adult fare north of the three dollar mark.
Jay Lake-Boudreau has the $2.75 in his pocket he needs for a trip to see his mom, but he says higher prices would likely mean less visits and “I’d probably be walking a lot more.”
In its 2014 draft budget the LTC is set to recommend a 2.4 per cent increase in the share it gets from the city. That’s about $600,000 more than in 2013.
Larry Ducharme, LTC general manager, says that's just enough to maintain services and hang on to the new riders gained since 2010.
But the recommendation is a far cry from the 0.7 per cent target increase proposed by the mayor and city council.
Ducharme says to make up the difference “We’ll either have higher fares or less service, or a combination.”
But higher fares come with a big risk – a 10 per cent fare increase usually comes with a 3.5 per cent loss in ridership – or 700,000 to 840,000 fewer rides.
Ducharme won’t comment on which routes could face cuts because he doesn't want to get people worried they could be losing their bus service – but he says any routes running at less than half their capacity would be at risk.
As of next year the city will subsidize every bus ride to the tune of 94 cents. While that's up from 90 cents in 2010, the 4.5 per cent increase is half the rate of inflation during that period.
On top of that, Ducharme says the price of fuel went up 30 per cent during the same period, which translates to an extra $1.7 million in costs.
