Rising diesel costs mean either bus fares go up or services go down, warns City of St. John's

·1 min read
The City of St. John's says high diesel prices are eating into Metrobus's operating budget.  (Eddy Kennedy/CBC - image credit)
The City of St. John's says high diesel prices are eating into Metrobus's operating budget. (Eddy Kennedy/CBC - image credit)
Eddy Kennedy/CBC
Eddy Kennedy/CBC

With the cost of diesel cutting into Metrobus's bottom line, the City of St. John's is calling on the provincial government to apply for federal relief.

In a press release Thursday, the city said the cost of diesel is "having a major impact on the budget at Metrobus" and it expects a shortfall this year of about $1.4 million.

"The current price of fuel is fully $1 a litre above our 2022 budget price," the release reads.

The release said the city is not considering a fare increase or significant service cuts right now but will be forced to without help, pointing to $750 million in emergency federal support announced in February for transit problems caused by the COVID-19 pandemic.

"The funding from this program is desperately needed now more than ever due to record high fuel prices," reads the release.

"The alternative is to either raise fares and/or reduce service in order to keep the transit system sustainable during these challenging times."

The funding is being allocated to provinces and territories based on the same formula used for the public transit stream of the Investing in Canada Infrastructure Program, the city said. Ridership has returned to pre-pandemic levels, according to the city's release, and with the recent extension of the income-assistance bus pass program the city hopes ridership will grow.

The relief calculation is based on 70 per cent transit ridership and 30 per cent population, conditional on matching from the provincial government. Newfoundland and Labrador would get just over $4.1 million, according to the release, which says the city wants the provincial government to confirm it will apply for the funding before it considers other options to address the Metrobus budget shortfall.

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