The STM tables its budget
«2008 will set the stage for public transit's revival»
Montreal, November 29, 2007 - As part of a press conference held today, the Chairman of the STM Board of Directors, Claude Trudel, presented the highlights of the transit corporation’s $938 M budget for 2008.
An exceptional $103 M contribution by Montréal’s urban agglomeration
From the outset, Mr. Trudel sincerely thanked Montréal’s urban agglomeration for its announcement yesterday that it was investing $103 M in the STM’s 2008 budget. “The administration is clearly showing its full support for the revival of public transportation, and we are grateful to them,” declared the chairman.
The $103 M investment is comprised of the following: the annual municipal contribution to public transit is increased by $23.7 M to reach $301.7 M for 2008. Of that amount, $5.7 M will be directed to the service improvements programme. Montréal also contributes a total of $50.3 M representing its share of infrastructure funding for 2005-2008. Finally, to redress the corporation’s past financial situation, a special $29 M contribution was granted.
Service improvements programme
In the wake of the Québec Public Transit Policy, supported by the Transportation Plan tabled last May by the city of Montréal, the STM developed its own ambitious plan. Beginning January 7, 2008, the transit corporation will provide an average of 26% more service than in 2006 on the métro’s 1, 2 and 5 lines, mainly during off-peak periods. Moreover, it will boost service on some thirty bus routes by extending rush hour periods. Indeed, it will upgrade service in downtown, as well as in some residential, industrial and tourist sectors currently being developed.
“Such commitment eloquently illustrates that public transportation is at the very core of sustainable development strategies and that it will become the preferential means of moving around in Montréal,” emphasized Mr. Trudel. “Thanks to these initiatives, the STM will be in a position to significantly improve its services and provide Montrealers with an even more efficient transit system.”
Limiting the average fare increase to 1.9%
Members of the Board of Directors agreed to limit the increase in fares by raising them only 1.9% on average. So, as of January 1, 2008, the regular monthly CAM pass will cost $66.25 instead of $65, while the cost of a reduced fare monthly pass will go from $35 to $36. The regular CAM hebdo will cost $19.25 instead of $19, while the cost of a reduced fare weekly pass will rise to $11 from $10.75. A strip of six tickets, regular fare, will cost $12 instead of $11.75, while a strip of reduced fare tickets will also go up by 25¢, costing $6.50 instead of $6.25. Finally, cash fares will remain the same at $2.75 and $1.75 for regular and reduced fares.
“We consider the average fare increase to be a reasonable one, when you take into account the overall increase in expenses generated by the STM’s dynamic approach to improving customer satisfaction and its drive to modernize its infrastructure and equipment,” explained Mr. Trudel.
Consistent growth for Paratransit
Regarding Paratransit, the STM plans on following through with the remarkable growth in demand for services it has been experiencing since 2005. It expects a 10% increase in the number of trips, for a total of 2.4 million trips. An additional $4.6 M will be allocated to Paratransit to support this increase.
“A recent survey showed that customer satisfaction is on the rise, not only with respect to service improvements, but also because of improved quality,” emphasized Mr. Trudel. “For example, both call centres enjoy satisfaction levels of 85%, while the majority of service components pertaining to interaction with passengers (safety of boarding manœuvres, welcoming attitude of drivers, courtesy) obtain remarkable results, from 88% to 100% satisfaction.”
Operating expenses under control
For 2008, expenses will rise by $80.6 M, or 9.4%, compared to the 2007 budget. By taking into consideration a 3.2% increase in service improvements, a 3% increase in capital spending, as well as a 1% increase in the accounting process for certain expenses, the result is a relative increase of 2.2% for operating expenses.
A soundly managed corporation
For several years now, the STM has maintained a sound yet rigorous style of management, while keeping its operating expenses under control. Indeed, its stringent administration was acknowledged by bond rating agencies Standard & Poor’s and Dominion Bond Rating Service, who recently announced they were upholding their respective credit ratings of A+ and A(high) for an 8th consecutive year.
“The massive $1.5 B investments required over the next three years to modernize equipment and infrastructure are without a doubt putting a lot of pressure on the STM’s operating costs. Thus, the transit corporation is expecting $33.7 M from new sources of revenue for 2008,” concluded Mr. Trudel. “I am confident that our governments will allow new sources of revenue specifically for public transit to ensure its sustainability and its growth, the same as everywhere else in the world.”
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