Durham transit riders are getting a serious boost. Ontario is routing nearly $380 million in gas tax funding to local transit systems for 2025-26, and Durham Region is in line for roughly $9.6 million to modernize buses and day-to-day operations. The cash comes from the province's Dedicated Gas Tax program and is being split among more than 100 municipalities across Ontario. Local officials say the infusion will help retire aging vehicles and pay for systems that cut fuel and maintenance costs.
The province's funding breakdown puts the 2025-26 Gas Tax envelope at nearly $380 million, shared by 107 municipalities, according to the Ontario Newsroom. The backgrounder notes that allocations are calculated each year using gasoline sales along with municipal ridership and population figures.
Durham Snags Cash For New Buses And Back-End Tech
Durham Region's 2025-26 gas tax allocation is listed at $9,633,396, and regional officials say they plan to stack that money with federal and local dollars to buy 10 new 40-foot diesel bus rapid transit vehicles and install fuel and fluid management software, as outlined in a joint release from Housing, Infrastructure and Communities Canada. Durham Regional Chair John Henry said the investments will help make local transit "more comfortable, sustainable and reliable" for riders, according to the release.
How The Gas Tax Fuels Local Transit
Ontario's gas tax program dedicates two cents per litre of the provincial gasoline tax as a permanent revenue stream for municipal transit. Municipalities can put that money toward operating or capital needs, including expanding service hours, buying vehicles, adding routes or improving accessibility, according to the Ontario Newsroom. The province has historically used a formula that is roughly 70 percent based on ridership and 30 percent on population to steer more funding toward systems with higher use.
Transit advocates, however, say the flat size of the overall gas tax envelope has left some systems feeling squeezed as costs climb. A review by the Financial Accountability Office found that most gas tax funding continues to flow to operating expenses and that provincial transit subsidies have not kept pace with inflation and growing demand, putting pressure on municipal budgets and service planning, according to the Financial Accountability Office.
Local politicians are still calling the latest allocation a clear positive for riders. MPP Todd McCarthy described the $9.6 million gas tax investment as "a significant win for Durham," as reported by InSauga.
Municipalities ultimately decide how the money is spent, and Durham says its fleet and software projects will roll out over the coming months as buses are ordered and systems are integrated. Officials say riders should see gradual improvements as new vehicles enter service and maintenance and fuel costs are reduced.
