On November 14, the TTC gave approval in principle to the proposed 2008 Operating Budget. A short report is available online but it is missing one critical page, the table the table giving the details of the budget by major revenue and expense area.
You can read the details in the report including a line-by-line discussion of the changes. Overall, the TTC’s operating expenses will rise about $74.6-million or 6.8% over 2007, and this does not include provision for wage settlements in the coming contract negotiations.
Each 1% increase in wages translates to about $8-million in annual costs, of which $6-million would affect the current budget year because the new contract will take effect on April 1, 2008.
Ridership and service will both increase in 2008, and the cost of new and improved services accounts for over one quarter of the year-to-year change ($20.9-million).
Among the other major contributions to rising operating costs are:
- Accident claims ($7.2-million) are rising both because of changes to the legislative environment, growth in the number of no-fault claims and higher settlement costs.
- Bus part costs ($4.6-million) are rising because newer vehicles are coming off warranty and the cost of spare parts, especially for hybrid buses, is higher than for the older diesel fleet. This trend is expected to continue for several years as the TTC renews its fleet and changes the technology mix. The cost of a replacement power plant for a hybrid is four to seven times higher than for a diesel. Whether this will fall as hybrids become more common remains to be seen.
As I mentioned in a previous article, the estimated ridership for 2007 has been cut by 10-million to correct for an overstatement of the Metropass trip multiple in the 2007 Budget. This rather sudden adjustment raises important questions:
- The TTC collects trip diary statistics monthly and would have known long ago if the multiple were dropping enough to affect year-end figures. Indeed, if this value were not stable, ridership reports and projections should be adjusted regularly to reflect ongoing changes.
- The level of assumed ridership affects projections for the budgeted amount of service, although more recently these two items seem to be decoupled (a long overdue change ever since passes came into widespread use).
- In recent debates about appropriate fares, much was made of the unreasonable subsidy afforded to Metropass users who get “extra” rides at no cost. Now, it seems that the number of “extra” rides they were taking is not as high as originally claimed, but they will pay a big increase in the pass price anyhow. Did the TTC withhold information about the falling trip multiple in order to ensure that Metropass users would be seen as taking more than their share of the subsidy?
The projected ridership for 2008 is 464-million, up from a probable level of 452-million (allowing for the vanished Metropass trips). This increase is projected to come from:
- economic growth (14M)
- fare media mix (more Metropass rides) (2M)
- leap year (1M)
- loss from the fare increase (minus 5M)
If the fare increase does not have the expected impact on riding, something that should be clear in early 2008, we will get more riders than projected. No riding increase is assigned to the pending service improvements for no clear reason, nor is any growth assumed from a possible introduction of a U-Pass for post-secondary students.
The total TTC workforce is projected to rise from 9,835 at the end of 2007 to 10,249 by the end of 2008. The majority of this change (378 out of 414 positions) comes from new operating staff for improved service.
The big news is that the long-awaited service improvements will finally show up in 2008, although some won’t be in place until late in the year.
Mitch Stambler, TTC’s Manager of Service Planning, gave a presentation which I will precis here. The indented text is my paraphrase of Stambler’s text. Comments in square brackets  are my own observations.
The TTC has suffered from overcrowding since 2005 with riding growth, but budgetary constraints. Modest increases were implemented in September 2006, but nothing else has been added due to limits on vehicle availability and the workforce. Major increases planned for fall 2007 were cancelled due to the City’s cost containment directive following the deferral of new taxes in July 2007. Ridership continues to grow and overcrowding is seen on 54 routes.
Passengers will accept some crowding, but as it worsens this makes moving through vehicles and finding seats difficult. Service reliability falls because of time lost to loading and unloading at stops, and there is no capacity to absorb a surge load. This leads to delays and bunching.
The results are uncomfortable overcrowding, unreliable service and passengers left behind at stops. All of this drives those who can to seek alternative ways to travel.
Accommodating demand on the TTC is fundamental for maintaining ridership gains won in spite of constraints, achieving ridership and revenue targets, and supporting the City objectives of reduced auto dependency, congestion, gridlock and pollution.
Customer research shows that passengers are more concerned about service than fare, and that they will pay more for better service. Service must remain at a level that keeps crowding at acceptable levels and operates reliably.
Several years of constrained resources limit the TTC’s ability to respond to rising demand including fleet size, garage capacity, instructors and training facilities, and drivers. [Note that Mt. Dennis Garage has not opened due to budget cuts.]
Examples of services that need improvement:
- 29 Dufferin PM peak: Average load is 61 riders, the standard is 57. Three buses will be added.
- 100 Flemingdon Park Sunday early evening: Average load is 65 riders, the standard is 38 [seated load on a low-floor bus]. Three buses will be added.
- 196 York University Rocket AM peak: Average load is 61 riders, the standard is 57. Two buses will be added.
- 506 Carlton weekday midday: Average load is 53 riders, the standard is 46 [seated load for a CLRV]. Three cars will added.
In 2007, strong economic growth plus the popularity of passes, especially for off-peak riding, drove up demand. An additional 20-million riders are expected in 2008 as this trend continues.
27 additional peak buses will be added in February 2008, and 89 additional peak buses will be added under the Ridership Growth Strategy in November 2008. [Additional changes for off-peak services were not detailed in the presentation.]
[The table below shows the additional service to be added in 2008. All values are in vehicle hours, and are shown with the budget year impact and the full year impact. The later an improvement is made in the year, the less the impact on the current year.]
- Crowding improvements deferred from 2007: 210K / 238 K (effective February 2008)
- Ridership Growth Strategy deferred from 2007: 8.7K / 87K (effective November 2008)
- Capacity for new ridership in 2008: 143K / 219K
- RGS off peak improvements in 2008: 35K / 303K
With these service improvements, including RGS changes so that all routes operate on the same hours as the subway system, The TTC will be there for Toronto, the Transit City.
On a full year basis, this is an increase of 847,000 vehicle hours of service. Putting this in context, the TTC operates around 145K hours of service each week although the amount fluctuates through the year. On a full-year basis, this is an 11% increase.
Although there are some outstanding issues to be resolved with the City Budget Committee about the final amount of the TTC’s subsidy and fine-tuning the budget, there is agreement that this proposal can go forward and that service improvements for early 2008 can proceed without waiting for the final budget approval at Council.
Crowding has finally penetrated everyone’s mind as the top issue facing the TTC. Recently, Chair Adam Giambrone could not get on a Finch West bus, and as a daily TTC user, he sees first-hand what riders must put up with.
Listening to the debate, I could not help thinking back decades to Gordon Hurlburt, a former chair of the Commission and a member back in the days when Streetcars for Toronto got started. One day, he arrived late for a meeting and grumpily reported that not only had he been unable to board the Sheppard East bus westbound at Leslie, he had to let several buses pass before one arrived with any space. After a suitable interval, a staff report appeared saying that “complaints had been received” but that no evidence of overcrowing on that route could be found. Hurlburt gave up fighting with staff.
Things have changed and it’s now acceptable to admit that service isn’t what it might be. I hope that we will see more of this type of system growth in years to come, that transit can get ahead of the rising demand and be a truly attractive “better way” to get around the city.