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No Value for Money with Maley Drive Extension

Apparently, David Boyce and our mayor can’t tell the difference between costs and benefits. They crow that the Maley Drive extension will add to the city’s GDP and create jobs. The addition to the GDP is just a measure of the money that will be spent. The so-called jobs are actually just another measure of spending. In fact, many of the jobs will go to construction companies and workers from outside of the city.

If David and Brian were talking about buying a suit, they would be saying the more it costs, the better it fits. That is wrong.

To justify a project, they have to show that the benefits are significantly larger than the costs. They have not done that. By my calculations, the total benefits are much smaller than the expected cost and I expect the cost to double before the project is done. The provincial and the federal governments will not share the cost of overruns, so I expect all hidden costs and overruns to end up as part of city debt. Higher debt means higher taxes, and that will encourage retirees to leave. Maley Drive is a kind of fiscal suicide pact for the city.

But let’s go back to the confused economic theory that says the amount we spend is a good measure of the benefit we get. We would get exactly the same impact on our GDP from spending on a new library and a new art gallery. We even get the same boost if we pay a kid to burn the money. This is technically correct national accounting and a stupid way to run a city.

We have to look at the value for money. What are the benefits that we get?

After several years of traffic problems during construction, we get a very small improvement in traffic flow, increased maintenance and snowplowing costs, and no reduction in total damage to the roads. We get more debt federally, provincially and at the city level.

Maley Drive was originally intended to serve the booming population in the northeast of the city. But the population in the northeast of the city has hardly grown in 40 years. It wasn’t worth doing when the city was booming: it isn’t worth doing now.

The new excuse for building the Maley extension is to get trucks off Lasalle. Why not just charge the trucks a fee for using city roads? After all, there is no law that says taxpayers have to subsidize trucking for the mining companies. A road charge is legal, cheap and actually adds to the city revenues. The money can be used to repair the roads. If we made the fee high enough, the companies might even go back to using the railroad, a solution that is cheaper in the long run and better for the environment.

The Maley Drive extension simply isn’t worth the price. There are cheaper ways to solve the problem it is supposed to fix, and there are better ways to spend the money.

*This letter was published in the Sudbury Star: http://www.thesudburystar.com/2015/03/04/sudbury-letter-maley-drive-fiscal-suicide

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