Taxpayers on the hook for transit shortfall in the Region of Waterloo

Grand River Transit is anticipating a $11 million shortfall in 2025. As CTV’s Jeff Pickel explains, it’s connected to declining enrolment at Conestoga College.

A drop in international student enrolment at Conestoga College is being blamed for a “significant” budget shortfall at Grand River Transit.

In a new report, the Region of Waterloo said the transportation operator is anticipating a deficit of $11 million in 2025. The change in enrolment stems from a major policy change by the federal government to cap the number of international students allowed to study at Canadian colleges.

When enrolment was high, the region had to pay up.

“We had a massive influx of international students coming into our community, where ridership spiked significantly,” explained regional councillor Michael Harris. “Investments had to be made in order to accommodate that new ridership.”

A Grand River Transit pass is included in post-secondary fees. When student enrolment dropped, there was a corresponding decrease in paid passes. But by the time the region realized the problem, it was too late to scale back operations to mitigate a major loss in revenue.

“Due to communication standards, it is too late to make service level changes that will impact our operating expenses,” the report stated.

As Harris put it: “You can’t just flick off a switch.”

So far this year, according to the Region of Waterloo, Grand River Transit is down $7.9 million. The number is expected to climb to more than $11 million by the end of the year.

“That is [a] significant revenue shortfall that, obviously, local taxpayers will have to bear,” Harris said, adding that federal policy changes and provincial funding also played a part in the post-secondary problem.

Conestoga College, for its part, laid all the blame on the government.

“Conestoga provided the most accurate enrolment projections available at the time,” the school said. “Like many colleges in Ontario, Conestoga has faced a significant decline in international enrolment, with approximately 20,000 fewer international students this fall compared to 2023.”

No matter who is to blame, in the end, someone has to pay.

“Local taxpayers will be saddled with the decrease in enrolment, because usually it’s local taxpayers left holding the bag at the end of the day,” Harris said.