Via gets $71M in federal money toward faster service in Ontario, Quebec

Via Rail is getting $71 million in federal cash — some through Transport Canada and some from an infrastructure financing agency — to help its plan to build dedicated tracks for faster, more frequent service in Ontario and Quebec.

The details unveiled Tuesday show that some of the money will fund work to make sure that Via trains can seamlessly move between any new dedicated tracks and local transit systems in Montreal and Toronto.

For Montreal, that includes running Via trains along the electric-rail system under construction, known best by its French acronym REM, which the Canada Infrastructure Bank is also financing.

The rail company wants to build a new, multibillion-dollar network of dedicated passenger-rail lines so its trains will no longer have to yield to freight trains on borrowed tracks.

The infrastructure bank money, totalling $55 million, will be largely used for environmental assessment, consultations with Indigenous communities and a technical and financial review to help the government make a final funding decision.

The rest of the money, $16 million, is coming from Transport Canada.

Private investors?

The high-frequency rail project is expected to cost $4 billion and Via Rail is exploring ways to have a private investor pick up some of the costs of building dedicated passenger-rail tracks connecting Toronto, Ottawa, Montreal and Quebec City and buying new trains.

The money from the infrastructure agency is part of its mandate to “de-risk” projects at an early stage in order to draw in private backers when real construction work gets underway. Via Rail is looking to create routes along discontinued and lesser-used tracks that would also connect to Peterborough, Ont., and Dorion and Trois-Rivières in Quebec.

A transportation advocacy group said the risks for the project are lower now that Via Rail has focused on existing corridors and rights-of-way, meaning work could be done by 2022.

“The largest risk, which we feel the government needs to pay more attention to, is the escalating opportunity cost to Canada of falling further behind the rest of the world on this vital aspect of our transportation infrastructure,” the group Transport Action Canada said in a statement.

“Infrequent and inadequate inter-city rail service both is a constraint on our domestic economic growth and a deterrent to international investors.”

The Liberals created the Canada Infrastructure Bank in 2017, aiming for it to use $35 billion in federal funding as a carrot to entice the private sector to get involved in paying for new, large-scale projects that are in the public interest, and can also provide a profit for investors.

So far, the agency has gotten involved in two projects, first with a $1.28-billion loan to the electric-rail project in Montreal, and last month with up to $2 billion in debt to expand GO Transit’s rail network around Toronto.

The money unveiled Tuesday is the first time the agency has handed out money without an expectation of repayment.