Mel’s Folly, or the Sheppard Sinkhole

Warning:  If you are a devotee of our former Mayor Mel Lastman and his cronies, you will probably be offended by this post.  If you think that the former City of North York was anything more than a bombastic, self-agrandizing Potemkin Village, you will also probably be offended by this post.  You have been warned.

To learn more about Potemkin Villages, click here.

People like me despair at the energy various Councillors expend in trying to make cuts to the transit system that save pennies.  Meanwhile, they gladly support the continued pursuit of subway construction at enormous capital cost and operating losses that would bring their wrath on lowly bus and streetcar routes.

Let’s have a hard look at the Sheppard Subway.

In the 2003 Operating Budget (October 23, 2002), the TTC states quite clearly that opening the subway will result in a net loss of $8-million per year due to additional operating costs.  This is net of the reduction in bus requirements and any additional revenue from new riders.  We can reasonably assume that increased riding and inflation in operating costs have more or less offset each other, and that there is still a comparable net loss to the system.

“During the first several years of operation, the Sheppard Subway will experience sizeable operating losses as costs exceed incremental passenger revenues.  This deficit will place substantial additional pressure on the operating budget shortfall.  Consequently, additional subsidy is required.”

They didn’t get any.

Indeed, the proposed 10-cent fare increase was expected to cost a ridership loss of 3-million while raising $21-million in additional revenue.  Note that about 40% of the fare increase was due solely to the cost of operating the Sheppard Subway.

On October 22, 2003, the TTC reviewed the performance of the Sheppard Subway.  Daily ridership was about 34,700 compared with much higher usage on other lines:

  • Yonge – 620,000
  • Bloor – 480,000
  • Scarborough RT – 42,000

The Sheppard counts were taken about 5 months after the line opened and in the middle of the SARS crisis, and ridership was expected to improve from the reported level.  In the near term, it was projected to remain below the projected level of 48,000 daily.

Peak point ridership was reported as 3,400 passengers per hour, or an average of about 300 customers per train.  A four-car train has a capacity of 670 and so there was lots of room for growth.  I watched the morning rush hour on several occasions at Sheppard-Yonge Station, and the typical train was full in the middle and half-empty at the ends.  The rush “hour” did not last 60 minutes.

Ridership in the Sheppard corridor was up 88% compared to the former bus services, but this was only for the peak hour and direction.  All day ridership was up 126%.  One could reasonably assume that at least half of the Sheppard Subway riders were new to the system although this might overstate the case as some would be diverted from the Finch corridor, and others would be diverted to ride west to Yonge rather than south to the Danforth subway.

“During all operating periods, the Sheppard Subway is carrying passenger loads well below its capacity and could be operated with fewer trains.

“Off-peak ridership on the new subway ranges from an average of approximately 80 customers per train during the busiest hour on Saturdays, to 30 passengers per train in the busiest hour in the late evenings.  After midnight, there are fewer than 15 people, on average, per train.”

I will not embarass supporters of the line by printing the utilization figures for the Yonge or Bloor lines here, but they are never below 300 per train.  Even the SRT outdraws the Sheppard line with much smaller vehicles and less service.

Station usage on Sheppard is not impressive.  Out of 74 stations (some locations, such as Bloor-Yonge, count as more than one for this purpose) the rankings of Bayview, Bessarion and Leslie are 69, 73 and 71 respectively.  This confirms demand projections done decades before when the origin of most riders was clearly shown to be east of Victoria Park and generally north of the Sheppard Corridor. 

Indeed, most of the riding originates outside of North York.  New or improved GO rail services on the Stouffville or Peterborough lines could have handled the downtown-bound peak traffic at a fraction of the subway’s cost.  But I digress.

On May 12, 2004, the TTC received yet another report on the new subway line.  By this time, riding was up from 34,700 recorded in early 2003 to 40,000 in early 2004.  Peak hour riding was up from 3,400 to 4,300.  This is good, but not spectacular in the context of other subway lines.

Meanwhile, the poor riders of the once-frequent Sheppard bus between Don Mills and Yonge were languishing with bad service, and it was about to get worse.

“An assessment of the financial performance of the 85 Sheppard East bus route, west of Don Mills Station, shows that the route has an unacceptable financial performance during all operating periods.”

The passengers per dollar figure (if you don’t understand this, read my post about Poor Performing Routes) ranged from a low of .05 to a high of .22.  The target is .23.

“Because ridership … is now relatively low and, because this service has a poor financial performance, the route will now be considered for possible service reductions.”

For those of you who read about the 33 Forest Hill bus, its passengers per dollar figure ranges respectably from .14 to .17.  We obviously need more Nannies on Sheppard East. 

The situation on Sheppard East is similar to that on Yonge north of Eglinton.  The local traffic does not “justify” a decent service, and so for all practical purposes, service vanishes.  This is a cautionary tale for all who would like the TTC to build a subway under their street.  Be sure that you live near a station.

So far, we have only looked at direct operating costs.  Now let’s be really businesslike and look at the capital account.  This is, after all, an investment in the future of North York!

The Sheppard line cost us about $1-billion to construct and equip, and that was in the “old days” when you could build a kilometer of subway for only $125-million.  (That junction at Yonge cost a fortune.)

Assuming a conservative borrowing cost of four percent, that’s $40-million per year just to pay the interest on the capital debt.  A mere $8-million in operating losses is chicken feed by comparison.

Those 40,000 riders per day translate to about 12-million riders a year (Saturdays and Sundays count for one day, and a multiplier of 300 is good enough).  This means that every ride on the Sheppard line is subsidized by about 67 cents on the operating account, and a whopping $3.33 on the capital side.  Yup, $4 a ride.  That’s some investment.

Meanwhile, we wring our hands that there are not enough nannies and kiddies on the Forest Hill bus.  That may be extreme, but the next time someone tells you how service on the Queen car is carefully managed and tailored to demand on the line, remember that $4 subsidy on Sheppard and ask why you can’t see a streetcar for miles.