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APTA's Canadian Study Mission: Infrastructure Development

APTA traveled north of the border in July in search of lessons about public transit infrastructure development. At this year’s APTA Annual Meeting, Immediate Past Chair Nathaniel P. Ford Sr. and President and CEO Paul P. Skoutelas hosted a panel discussion about the six-day, 30-member delegation they led to Montreal, Ottawa, Toronto and Vancouver—all places with major infrastructure projects underway.

Panelists included Buddy Coleman, chair of APTA’s Business Member Business Development Committee and chief customer officer, Clever Devices Ltd.; Lowell Clary, president, Clary Consulting; Charles Di Maggio, chief operating officer, Greystone Management Solutions; Nuria Fernandez, APTA vice chair and general manager/CEO, Santa Clara Valley Transportation Authority, San Jose, CA; Therese McMillan, chief planning officer, Los Angeles Metro; and Jeff Wharton, chair of the Business Member Board of Governors and president, Koehler-Bright Star LLC and IMPulse NC LLC.

Also on hand in the audience was Josh Colle, chair of the Toronto Transit Commission (TTC), who added a Canadian perspective to the session.

Ford explained that APTA selected Canada as its study mission destination because the Canadian government is investing heavily in transit infrastructure—more than $22 billion in U.S. dollars to start—with additional funding from provincial and local governments and from the private sector expected to top $60 billion over the next 10 years.

“Most of that investment is dedicated to new capital projects and state of good repair—two critical needs for the U.S.,” he said. “Canada also has had a great deal of experience with P3 projects, an important financial mechanism that’s attracting more attention in Washington, DC.”

Skoutelas noted differences between the Canadian and U.S. approaches to federal and local roles. For example, the Canadian government directs funding to what it considers “transformative transit projects,” but local operators have a significant degree of autonomy in how they plan, finance and deliver projects.

He also said mechanisms at the provincial level can assist with contract management and financing for large infrastructure investments across industries.

Panelists, from left: Charles Di Maggio, Nuria Fernandez, Lowell Clary, Francis “Buddy” Coleman, Jeffrey Wharton, Therese W. McMillan, Paul P. Skoutelas and Nathaniel P. Ford Sr. at podium.

Several panelists observed that the cities and provinces they visited had different approaches to infrastructure investment. In Montreal, for example, decision-making authority is delegated according to each agency’s core competencies, or what Clary called “appropriate risk allocation.”

In Ontario, Metrolinx worked closely with Infrastructure Ontario to develop four business cases to strengthen the value proposition and cost-benefit ratio for a mega transit project.

TTC conducts a rigorous analysis of procurement options before making specific project decisions.

And in Vancouver, TransLink runs a sophisticated real estate program that allows the agency to offer its own parcels as a swap for land it needs to acquire for new routes and facilities, thereby fostering goodwill.

McMillan cited three critical elements in many of the successful Canadian projects: extensive collaboration, ongoing communication and community leadership/engagement. “We saw ferocious stewardship, nose-to-tail, with people actively managing multiple development projects,” she said. “This was particularly relevant to what we’re doing in Los Angles.”

Partnerships and accountability were common themes. Coleman said, “When you’re in a true partnership, the benefits are obvious; everyone works together, whether they are private contractors or government officials.” He added, “All parties jointly owned the accountability for what they needed to deliver.”

Di Maggio said, “In Vancouver, 10 mayors and representatives of the provincial government shared a common strategic vision with the public transit authority. This guaranteed local buy-in.”

The Canadian government does not impose a single, national procurement model. Instead, the panel explained, every project starts with the business case and then the most appropriate procurement method is selected after an in-depth analysis.

Although P3 financing is more common in Canada than in the U.S. because Canada does not offer tax-free municipal bonds, most of the country’s transit infrastructure projects use traditional funding methods. P3s tend to be more common for new infrastructure investment, while traditional financing is usually used for state of good repair projects and expansion of existing infrastructure.

“Not everything in Canada is applicable to the United States because of our regulations and obligations,” said Fernandez. “Still, Canada is a leader in many ways to fund, maintain and expand infrastructure, and there were valuable lessons to be learned from the trip.”

One positive takeaway for the delegation was the public’s acceptance of and support for public transportation. In Ottawa, for example, 100 percent of gas tax proceeds fund public transit.

Skoutelas noted that Canadians seem to take a “more sophisticated approach to ‘value capture,’ especially with respect to land use.” He also said Canada’s approach to P3s continues to evolve as communities gain greater experience over time.

The panel agreed the study mission was an important opportunity for APTA and the U.S. industry. “As we think about a future infrastructure bill and reauthorization of the FAST Act, it was useful to understand different approaches to and ways to finance public transit infrastructure development,” said Ford.

Ford thanked the Canadian Urban Transit Association for working with APTA to help plan and support this ­successful study mission.

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