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Finance & Innovation

Calgary Just Slashed Transit Prices for the City’s Poor

C-Train at City Hall Station, Calgary LRT
Wikicommons: Mpr001

People living in poverty in Calgary, Canada, will be able to use public transportation for just $5.15 a month. The city council approved the 95% discount people making less than $12,000 Canadian dollars a year. The discount will take effect at the start of 2017.

“This is a big deal,” said Calgary Mayor Naheed Nenshi.

Currently monthly transit passes cost $99 a month for an adult. The new city order provides a tiered discount depending on a person’s income. The sliding scale discount ranges from 95% discount for people making half the national poverty rate to 50% discount for those earning 85-100% of the poverty rate.

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Advocates for the lower transit prices said the high price of train and bus tickets had become a barrier to getting out of poverty. The city council heard testimony from a wide range of experts and people directly impacted by the transit prices over the last six months.

“A homeless person who can prove that they’re earning less than a certain amount can now literally pick bottles for a day and buy a (monthly) bus pass with it,” Nigel Kirk told the council earlier this month. Kirk has spent the last five years living on and off the streets in low income housing. “That’s huge. [The homeless] can now find jobs. They can go to their appointments. It’s a huge victory.”

The new transit subsidy is made possible in part because of a $13.5 million (CAD) grant from the Alberta Provincial government.

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Calgary is not the first city to adopt transit discounts for its low-income residents, but starting in 2017 it will offer the cheapest transit tickets for the poor in the world.

Cities like Seattle and London have transit subsidies based on income but none of them approach Calgary’s level.

Larger metropolises have struggled to balance the rising cost to build and maintain transit infrastructure with the financial capabilities of its neediest consumers.

For example, New York City has been in a protracted public debate about the rising cost of its monthly subway passes. The city currently only offers half-price fares for senior citizens and qualifying disabled residents. This is despite a report from the Community Service Society of New York showing that 58% of poor New Yorkers rely on the subway system. To make matters worse,a quarter of the city’s low income, working-age residents say they often can’t afford a monthly subway card at all.

Across the United States the problem is not any better.

"Transportation needs are the second-largest expense for Americans after housing and one-third more than what they spend on food. Lower-income Americans spend more than 40 percent of their take-home pay on transportation," according to research by the American Public Transportation Association.

And around the world the situation is very similar in both developed and developing countries.

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Calgary is not waiting for the rest of the world to catch up. According to its mayor the current proposal still does not go far enough.

"The next step is what do we do with working poor people who are making just above the poverty line, because right now there's just a sudden drop off," Nenshi said.