TransLink Funding Model Adapts As Fuel Use Falls

By Sherri Claydon| Vancouver City News | October 6, 2026

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Republication Note
Originally published by Vancouver City News. Republished by Delta City News as part of the WBN News Network.

Metro Vancouver's transportation funding model is adapting as vehicles use less fuel and the long-term fuel-tax base declines. The shift is weakening a decades-old connection between driving, fuel consumption and one of the revenue sources that helps fund the system.

Metro Vancouver's transportation funding system was built in part around a straightforward relationship: vehicles travelled, vehicles consumed fuel, and a tax on that fuel helped pay for the regional transportation system.

That relationship is changing. Vehicles can travel farther on less fuel, hybrids consume less gasoline, and battery-electric vehicles use no gasoline or diesel. TransLink says average fuel consumption per vehicle has fallen 45 per cent since 2002 even as the number of vehicles on the road has increased. As vehicles use less taxable fuel, the connection between driving and the revenue collected through the fuel tax weakens.

That long-running shift is behind an increasingly immediate funding question. On October 2, TransLink confirmed that its current Investment Plan funds the transportation system through the end of 2027. The Province has also committed, subject to legislative approval, to enable additional revenue beginning in 2027, with at least $112 million annually expected once the new funding is fully implemented.

A Tax Built Around Fuel Consumption

When the Greater Vancouver Transportation Authority was established in 1998, fuel taxation was built into its funding structure.

The legislation set a regional tax of eight cents per litre beginning April 1, 1999, with increases scheduled afterward.

The current TransLink regional motor-fuel tax is 18.5 cents per litre. It is based on litres of taxable gasoline and diesel sold in Metro Vancouver, not on the price of fuel.

That distinction matters. If fewer taxable litres are sold, TransLink receives less fuel-tax revenue even when the tax rate remains unchanged.

By The Numbers

Annual revenue from the regional fuel tax peaked in 2022 and by 2024 was already more than $50 million a year below that peak.

TransLink's 2025 Investment Plan says the decline happened faster than previously forecast and contributed about $1 billion to the ten-year deficit compared with assumptions in the 2018 Investment Plan.

The decline is not expected to happen in a straight line. TransLink's 2026 budget projects fuel-tax revenue of $373.8 million, two per cent higher than projected in the 2025 budget because of a temporary stabilization in gasoline volumes. It says fuel consumption is declining more moderately than anticipated, but the longer-term trend of declining fuel volumes is expected to continue.

Adapting The Funding Model

As vehicles became more fuel-efficient, regional transportation planning began examining what declining fuel consumption could mean for the funding model.

By 2014, regional transportation planning was explicitly discussing declining fuel-tax revenue and examining mobility pricing as a possible longer-term alternative.

The issue received further study through the Mobility Pricing Independent Commission between 2017 and 2018. The commission examined regional road-usage charging and related transportation pricing, including questions involving congestion, fairness, transportation investment, affordability and effects on businesses.

The funding mix has continued to change. Fuel tax is one of several TransLink revenue sources, alongside transit fares, property taxes, parking taxes and government funding. The 2025 Investment Plan included changes to property tax, parking tax and transit fares as part of its response to the funding shortfall.

Why It Matters

Metro Vancouver's transportation funding system was designed in part around a relationship that made practical sense at the time: vehicles used roads, vehicles consumed fuel, and fuel consumption generated transportation revenue. That relationship no longer works in quite the same way.

The funding model is already changing, and the Province has committed to enabling additional revenue beginning in 2027, subject to legislative approval.

The consequences reach beyond the funding model itself. TransLink has warned that without sustainable long-term funding, transit service and road investment will eventually have to be reduced.

However we choose to travel, the transportation system has to work when we need it.

By Sherri Claydon | Vancouver City News

LinkedIn: https://www.linkedin.com/in/sherriclaydon

Source Information

• TransLink — October 2, 2026, response regarding long-term transportation funding in Metro Vancouver
• TransLink — 2026 Business Plan Operating and Capital Budget
• TransLink — 2025 Investment Plan, approved April 30, 2025
• Province of British Columbia — Motor Fuel Tax and Carbon Tax Rates, including the South Coast BC Transportation Authority rate
• British Columbia — Bill 36, 1998, Greater Vancouver Transportation Authority Act
• Mayors’ Council on Regional Transportation — 2014 Regional Transportation Investments planning documents
• TransLink — Mobility Pricing Independent Commission and Metro Vancouver mobility-pricing research

Tags: #Sherri Claydon #Vancouver City News #TransLink #Metro Vancouver #Transportation Funding #Fuel Tax #Regional Transportation #Vancouver News