Q&A with Philippe Schnobb, STM's chairman
Budget woes forcing Montreal's public transit agency to look at ways to cut and save
Mike Finnerty, host of CBC Radio's Daybreak, talked to Philippe Schnobb, chairman of the board of the Société de Transport de Montréal (STM), on Tuesday morning about the agency's budget woes and how they might affect services.
What effect will STM's money problems have on services?
My main goal with the board of directors was that decisions should have as little impact on services as possible. There was talk of eliminating entire bus routes, and we said that wasn’t acceptable. So we had to go to “optimization” – cutting back on service outside of peak hours – and the savings are going toward our deficit. We have to present a balanced budget so we don’t have any choice. Bus routes that we call "10 minutes max" will be preserved, there will be no impact on those routes. But we can’t say exactly what the impact will be [on other routes]. We’re working on that. Those changes will take effect in June.
If your goal is to provide more service, why are you cutting back?
It’s a matter of minutes: instead of the bus being there at 12:15, it will be there at 12:18 or 12:20. We actually do this kind of optimization throughout the year. Normally, we would put the savings into more routes or services, but this year we have to put it toward the deficit.
We’re expecting better revenues, though not necessarily from our clients; clients already pay 50 percent of the costs. The problem is, when we look at this fiscal year, we understand that we have problems. What preoccupies me is that if we look ahead to 2015, 2016, 2017, we’re heading into even larger deficits. The reason for that is a few years ago we tabled a strategic plan, Strategic Plan 2020, and in that plan it was clear that the deficit in 2020 would be $261 million. Everyone at City Hall, everyone at the CommunautémétropolitainedeMontréal, everyone was happy with that and said we’d find the money, but now we’re realizing that we can’t find the money.
One thing we realized is that the public finances are not in a good state at the provincial and municipal levels. So we had to look again and figure out what we absolutely have to do. We need new metro cars, so we ordered 468 cars.
Is Hydro-Québec now charging you a higher rate?
Yes. It will have a small impact on this year’s budget, and we are in talks with the government about that. This will have a great impact if we want to introduce electric buses, too. As it will on plans to expand the Metro’s blue line. The major issue, however, is we have to pay for the new trains. And we have to update the trains on the orange line, which date from the 1970s. Just for the first batch of train cars it’s $2.4 billion. We’re paying 25 percent of that, and it has a major impact on our finances. We have to think about a new financial deal. Even if we raise the fares, that won’t be enough. But we don’t want to put them too high. A monthly pass in Toronto is $133 a month, and here it’s not even $80, but we don’t want to go there.
Are there any common factors behind problems affecting the Metro system?
I would like to say yes, but no. Fifty percent of the failures are our responsibility, so when we say we need to improve, we need to improve our trains. Next month we’re beginning some repairs on the yellow line. These are the kinds of investments we have to make to maintain the reliability of our system. The other 50 percent are caused by customers, though I’m not blaming anyone. People fainting, getting sick. Even if we have the best system in the world, those things won’t change. We have to call the ambulance, the ambulance takes time to come.
Could BIXI become part of the STM?
A few years ago that question was asked, and we said we could be interested in taking care of BIXI. But we have had no discussions about that with the city since the new developments. If that comes up as a possible solution in the next months, we’ll sit down and talk seriously about it. Our main goal is that if we do take care of BIXI, that the annual deficit, which will still be in the millions, does not affect service and fares for the clients of our subway and buses.
What’s the good news?
We’ll have cell phone service this year with no costs for us, and it will even be a source of revenue for us. And the new trains by the end of the year. And we’re working for better news next year.