Budget drafts and funding schemes were rolled out at City Hall this week (well, sort of, details weren’t always included), and as we already knew, OC Transpo needs to find new ways to increase revenue. Naturally, they’re going with some fare increases (praying they don’t kill off too much of their customer base), but they’ve also got a new plan. They’re looking for $200,000 from Bluesfest.
The rationale is pretty simple. Fares only cover about half of OC Transpo’s costs. OC Transpo provides extra buses for Bluesfest. Bluesfest (and/or their customers) should help cover the tab.
Kitchississippi councillor Jef Leiper does not like this plan. In a thorough blog post, he notes that Bluesfest is a big part of our music and festival scene; that OC Transpo customers expect and deserve a certain level of service; that Bluesfest, in conjunction with the city, does a lot to help out the music scene and kids who want to get into music; and that Bluesfest contributes a lot to our economy.
(To the last point, I’m not persuaded. This sounds like the same rationale for supporting major league sports teams, but study after study shows the economic benefits are never what they are touted to be.)
There are varying degrees of merit to these arguments, however, he puts forward one argument that’s a bit weaker:
The benefits of providing great transit to music events and venues isn’t just economic. It’s critical to ensuring a safe way home for music fans after a night out, greatly reduces the carbon footprint of major events, mitigates residential neighbourhood parking and associated enforcement problems, and reduces congestion.
We’re not necessarily talking about cutting service. We’re talking about adding responsibility to pay for the cost of the service to Bluesfest and, most likely, their fans, as it seems reasonable to assume that the bulk of any extra charges will be passed on through ticket prices. This won’t lead to a drop in service, or a drop in ridership (unless some fans eschew the bus out of spite). It will just be shifting the cost onto the event that is necessitating the additional service.
…Except we don’t know if that’s what is happening.
Roughly speaking, we can say that half of all bus rides are paid for by the city…but not all bus trips are created equal. That crammed 95 that can’t fit anyone else on is bringing in a lot more cash than that final run of the 148 that has about five people on it. There must be (again, roughly speaking) a point where bus routes become profitable, but we don’t know when that is.
So here’s the calculus we need: how much more does it cost OC Transpo to run those extra buses to Bluesfest? How much additional revenue are Bluesfest attendees bringing to OC Transpo? How much of that additional revenue is realized because of the additional service? What is the desired service level (in terms of not-crammed-buses) that we should be targeting for buses (regular and additional) to and from Bluesfest?
If Bluesfest service is a net drain on OC Transpo’s coffers, then the festival needs to be charged. Bluesfest might be great, but it’s not so great that it deserves special funding from OC Transpo.
But if the additional buses are paying for themselves, without making the regular buses less profitable (or even bigger costs), then this gambit by OC Transpo is just a cash grab…they’re seeing something successful and trying to find a way to suck some extra cash out of it. They’ll be a leach providing no commensurate value.
OC Tranpso shouldn’t be allowed to charge Bluesfest $200,000 until they can provide an economic case for it. Until then, it’s just extortion.