Los Angeles vs Toronto: Funding and Building a Transit Network

Something is definitely in the air in Toronto, and it’s not just the unusually early arrival of spring and tree pollen.  Suddenly, everyone is talking about transit expansion, and of paying for it with real money, not the fairy dust of “private sector” investment.

The latest installment comes thanks to Los Angeles of all places, a city-region with the political will and leadership to actually build rather than to whine endlessly about how they can’t afford to do anything unless some other government picks up the tab.

Back in early April, John Lorinc wrote in the Globe about the LA transit plan and the funding — a dedicated regional half-percent sales tax — that underpins the whole scheme.  Two weeks later, Richard Katz was in Toronto talking about transit funding.  Katz is an advisor to Mayor Villaraigosa, chair of the regional commuter rail system, Metrolink, and a member of the LA County Metropolitan Transportation Authority board.

Katz is an entertaining speaker, and his background as a California legislator responsible for important measures addressing transportation problems gives him a depth of experience with no equivalent in Toronto.  His presentation covered a lot of ground, although it ran into swampland toward the end trying to explain how the financing schemes would work.

A few key issues need to be mentioned up front:

  • Political leadership, transparency and inclusiveness are essential.  Without a major figure like Mayor Villaraigosa championing the program, transportation improvements and funding for them would never get the broad political support needed.  Plans have to be public and their benefits to a wide variety of communities well-understood.
  • Los Angeles didn’t start to focus on transit yesterday, but started its rapid transit program in the 1990s.  At that point, the work was ridiculed in some quarters as a waste of money, but it built the foundation for a broader network.
  • LA’s half-cent sales tax, the subject of much recent comment in Toronto, is only one of several revenue sources for both capital and operating dollars.  Indeed, there were two other half-cent taxes (for a total of 1½%) already in place, and the mechanism is familiar to voters.

Los Angeles County is a huge region of just over 4,000 square miles of which two-thirds is unincorporated even though there are 88 cities within the county.  The largest of these is the City of Los Angeles (503 square miles) home to about 40% of the county’s population.  By contrast, the City of Toronto is a mere 240 square miles.  The City of Toronto’s population density is about 25% higher than the City of Los Angeles, but beyond these boundaries comparisons get tricky depending on what areas one includes as part of the “metropolitan” region.

From a transit planning point of view, both regions contain large areas whose populations and travel patterns are unlikely to be well-served by transit, but which contribute to overall regional demand especially if their population grows.

Los Angeles has been a large city-region for much longer than Toronto and its famous “sprawl” was made possible by a network of steam and electric rail lines, not to mention a large streetcar system.  Privately-owned transit lines existed to support real estate development, a model that declined as personal transport became more common.

As the city’s transportation orientation shifted to cars (with some notorious help from anti-rail-transit practices by the automotive industry), the local and regional lines disappeared in the early 1960s.  Some rights-of-way remained as the foundation for transit’s renaissance decades later.

Richard Katz’ presentation begins with an overview of the Los Angeles County Metropolitan Transportation Authority.  Daily ridership is roughly equal to the TTC (which has a much smaller service area and population), although it is more concentrated to peak periods (less than half of TTC riding occurs during the peak).  This translates to very different service levels and patterns in LA than we see in Toronto.

The most recent half-percent sales tax came through “Measure R”, a ballot initiative (we would call it a plebiscite or referendum) in the fall 2008 election that was approved by just over 67% of voters (a two-thirds majority was needed to implement a new tax).  This tax is expected to generate $36.1-billion from 2010 to 2040 when the tax will expire.  Only 35% of the revenue will be dedicated to rail expansion projects, 25% will go to operations and 20% to highway projects.  This is an important distinction compared with Toronto where all debate has turned on the funding of transit capital at a time when local municipalities are cutting back on transit operating funding and service.  As for highway funding, that’s part of the political reality in LA as the highway network is so important a part of local travel.  A transit-only tax would simply not generate enough voter support.

A map of the Los Angeles transit system shows the many proposed extensions.  For those unfamiliar with this network, the major routes are identified by colour, but three separate technologies are used:

  • Subway:  Red and Purple lines
  • LRT:  Blue, Gold and Green lines
  • BRT:  Silver and Orange lines

Overlaid on this is the regional rail system (roughly the equivalent of GO Transit) operated by Metrolink, the agency Katz heads.

Originally, five major projects (highlighted on the map) were to form the bulk of work in the first ten years of Measure R.  However, Mayor Villaraigosa now seeks to accelerate the entire 30 year project into a 10 year window by borrowing the necessary capital up front, secured by the future Measure R revenues.  This is intended not just as a shot in the arm for transit, but also for employment in the LA region that has fallen off greatly in recent years.  This is a notable difference from Toronto where even the scale of the original Transit City scheme was criticized as being beyond the capability of the overheated local construction industry (strangely, this criticism has evaporated now that Queen’s Park wants to spend $10-billion on local transit over the coming decade).

I could not help feeling a sense of monument-building in the desire to accelerate projects by a mayor whose time in office faces term limits this year.  The spike in spending the compression of a 30-year program into 10 will create is shown on page 11 of the presentation.  Presuming that this can be funded, what was not explored is the “after” situation where the pace of construction falls off and revenues for 20 years into the future are tied up paying down the debt.  The Mayor and his staff have invited investment from a Chinese state agency who, amusingly, accuse LA of being too “socialist” because they seek to generate employment and development with public money.

Both the transit and highway construction work are expected to generate huge numbers of jobs and spinoff economic activity including taxes that will be collected at various levels of government.  This is not unlike the argument advanced by Metrolinx as part of their benefits analyses for transit projects.  The underlying debate, however, must always remain whether spending is done wisely and on projects that will prove useful in the long run.

Like our Metrolinx, LA’s MTA argues that the new transit lines will take many cars off the road, reduce congestion, lower fuel consumption and eliminate some pollution.  This is true only if that represents a real reduction in traffic levels.  On that score, it is not clear, especially in Toronto, that traffic (and all the effects it brings) will get any better, particularly as the built-up area of the GTA reaches further out into low-density development and diffuse origin-destination patterns.

Population in the City of Los Angeles grew by under 10% from 1990 to 2010 at a rate of about 15,000 annually (3.49m to 3.79m).  The County of Los Angeles grew from 8.86m to 9.81m over the same period, and is projected to grow to almost 14m by 2040.  Whether this growth will actually be achieved and where it will occur relative to transit and road networks was not explored in Katz’ presentation.  By comparison, the GTA expects to see 100k more residents per year for the indefinite future, and many of these may locate beyond easy reach of transit.

Looked at over a 30-year window (page 9 of the presentation), there will be $269-billion in transportation spending.  However, comparisons with the GTA require that this be adjusted to put things on an equal footing.  About 35% of the spending will be on rail and bus operations and another 33% will go to roads.  About 9% will go to debt service (about which more below).  Only 20% of the total goes to bus and rail capital requirements.

Measure R will fund about 13.4% of the total, and a further 30.9% will come from state and federal governments.  The remainder, 55.5%, shows up as “local”, but this is actually a combination of other sales tax revenues and fare income.

More details are available in a second presentation on Measure R.  This was not included in Katz’ talk, but it gives a better understanding of what is going on.

Page 5 includes a graph of LA County’s population from 1990 to 2011.  Although there was strong growth from 1996 to 2004, this flattened out.

Page 7 shows the revenue history from the first of the half-percent sales taxes, Proposition “A” starting in 1984.  The effect of economic fallout starting in 2008 is quite clear, and it is noteworthy that the 30-year forward projections for increasing tax revenue assume that the rate of increase will decline in the out years.  However, as with any economic projections, a severe slump could hobble growth and throw the whole scheme out of whack.

Conservative projections for future revenue growth are essential especially for any debt that will be funded from this stream.  The ratio between expected revenue and debt service (page 9) has been kept high to ensure good bond ratings.

Page 12 lists several constraints on the repurposing of Measure R revenues noting that transfers between subfunds can only be done between the transit and highway capital funds, that this can only be done once per decade starting in 2019, and that approval of both the Metro board and voters is required.  Contrast this level of open distrust that governments will keep their word with the situation in Ontario where money and “commitments” shuffle around like leaves in the wind.

Page 15 shows that each subfund has its own targets for current and debt financing.  None of the operating funding can incur debt, but must be paid out of current tax revenues.

What appears to be happening, however, is that the ratio of Measure R income to the debt it must service will be considerably lower than for the earlier tax measures.  This implies that most of the Measure R money devoted to transit capital is already spoken for and anything beyond already announced projects (including some that do not yet have full funding) will require new revenue sources.

Translating all of this to a GTA context takes some doing, and would have been helped by a comparative overview of the economies, geography and politics of the Los Angeles and Toronto regions.  The LA experience shows that if there is a will to take on new revenue sources, then capital and operating investments can follow.

What Toronto lacks is leadership at the municipal and provincial levels.  I will turn to the general problem of funding transit and the required scale of investment in my next article.


Thanks to Bart Reed, Executive Director of the LA Transit Coalition for a few corrections (including a howler where I had the Red Line opening a decade early), and for the following comment.

LA hasn’t built new roads in decades. Yes, segments were finished around the Southern CA region, but in the Los Angeles regional basin, the bulk of the highways were completed decades ago. Some projects like the carpool lane system are still being built today, but that is road widening.

You can absolutely live a lifestyle in Los Angeles without a car, unlike the misstatements of some of the commentators.

My 10 Tiger Team interns are looking at bus rail connectivity at Metrolink Stations. Forcing changes to make the bus system work with the trains will also be a paradigm shift. One project at a time.

Ah yes … making buses and trains work together seems to be a problem not confined to the GTA.

13 thoughts on “Los Angeles vs Toronto: Funding and Building a Transit Network

  1. I think it instructive that LA, the car-capital of NA, the haven of highway “build it and they will drive it & congest it” now understands the folly of solely relying on automobiles for urban transportation and is now embarking on a paradigm shifting regional sales tax “Measure R” to provide long term (sustainable, if not predictable) capital & operating funding for both roads & public transit .


  2. The experience in the U.S. has been, sometimes, that specific funds that should have been directed to public transit or projects that included public transit, have been redirected instead to highway projects only. The reason is usually that gasoline taxes are still fixed and not adjusted for inflation. For example, in Ontario, the gasoline taxes have been at 14.7¢ a litre since 1992. Only with the HST on fuel has there been an adjustment made, except that the gasoline taxes and HST are currently directed towards general revenue, and not towards transportation as they should be.


  3. Los Angeles is built for cars. Even with subways and LRTs you still have to rely on a car to live there. So when you’re getting beat by Los Angeles in transit building, I’m sorry, but you have a major problem.


  4. Actually, I think the 1984 Olympics were instrumental in building the LA subway.

    Steve: (Corrected response). Considering that the first segment of the original Red Line did not open until 1993, the connection is tenuous. Planning may have begun in the 1980s, but by the time something was actually built, the Olympics were a distant memory.


  5. Steve noted:

    “You can absolutely live a lifestyle in Los Angeles without a car, unlike the misstatements of some of the commentators.”

    Steve: Actually that quote is from Bart Reed in LA.

    Ten years ago I spent 15 carless months in Pasadena, using a bicycle and bike-rack equipped buses to go to Marina del Rey once or twice a week. Even then, there was an on-line trip planning tool, and despite sometimes hour-long long headways, I was able to get around. This was before the Gold Line opened, but I used the very deep Red Line a few times. Of course, I often went with car-equipped friends, and rented once or twice, but dependence on transit went as far as bus and rail between LA and San Diego, and coaches in Mexico (much, much nicer than US Greyhound).

    California has a seriously dysfunctional state constitution and political culture, yet the County of Los Angeles and similar bodies have accomplished outstanding achievements of good government. I lived three years there in the late seventies, and in the quarter century between my stays there the air quality in LA improved enormously, thanks to steady identification and reduction of source after source of pollution.

    However, the situation is much worse further inland and beyond LA County, in the so-called Inland Empire in the direction of San Bernardino, which is where the sprawl takes place. Lack of transit and new freeways results in gridlock, leading to more pollution, in a narrowing valley with a severe inversion layer problem. The brown smog is very much present up there, whereas it has almost vanished from LA and the immediately neighbouring towns such as Pasadena. And to think that in the 1920’s one could travel by light rail from the sea to San Bernardino faster than you can now by car.


  6. The funding model in Los Angeles is a good model to copy, but the level of funding is severely inadequate. Los Angeles has the worst transit network of any city of its size (17 million people). Cities the size of Los Angeles need a large network of subways and high capacity, high frequency commuter rail (like other cities of comparable size, such as New York, Osaka, Seoul, Shanghai, etc.), and building a tiny network of low capacity light rail as the backbone of the network is not adequate. Toronto is a much smaller city than Los Angeles, but cities of 5 million with good transit networks do not use light rail as the backbone of their networks, they use it as a feeder line (like St. Clair, Spadina but not Eglinton). Madrid has 13 subway lines, 10 commuter rail lines and a small light rail system that is a feeder (runs through much lower density areas than Sheppard/Eglinton). Given budget constraints, Los Angeles and Toronto should be focusing most of their efforts on commuter rail, which is much cheaper to build than subways, rather than light rail. A project like an upgrade of Lakeshore GO costs about the same per km as light rail on a route like Sheppard but provides much higher speed and capacity.

    Steve: I agree with you in part, but we are limited on the commuter rail front to areas with an existing rail corridor. Much of the debate about the role of a subway network and long-haul commuters from the outer 416 and inner 905 arises because GO Transit has not expanded as it should have, and continues to drag its feet even in the face of plans in “The Big Move” for massively increased service.

    Some folks at GO are openly dismissive of plans for much better service, and seem happy to just run a few commuter trains in each rush hour from now until doomsday. Until we see a strong push for better service, and for the electrification this will almost certainly require, from GO management, and a fare structure that does not discourage comparatively short-haul riders from using GO, we are doomed to building very expensive “solutions”. GO can’t carry everyone, but it could take a better share of the load than it does today.


  7. Interestingly the “transit rush” that Measure R and the 30/10 plan have spawned has led to a rehash of a some debates that Torontonians and readers of this blog in particular should know painfully well. In the Crenshaw corridor an LRT line with mostly at-grade running has been planned but – you guessed it – the “subways vs. LRT” monster is rearing its head as evidenced by the Crenshaw Subway Coalition. In a nod to what we just went through on the Sheppard East LRT project, CSC is a coalition of southwest L.A. citizens and business owners who are campaigning to put the light rail line underground instead of in the street median. They also want two extra stations added to the route to better serve their community. Sound familiar? I couldn’t help but see this as a mash-up of the Sheppard East LRT and Air-Rail Link debates.

    Rhetoric notwithstanding, anyone who has been following the evolution of transit plans here in Toronto might find it instructive to read a bit about L.A.’s struggle to come to terms with the same issues. The CSC has made some relatively slick videos and posted them on YouTube outlining their arguments for a subway alignment (here and here), which include:

    1) At-grade light rail construction will be overly disruptive, destroying local businesses in a historic ethnic community
    2) At-grade light rail is dangerous to the health of children and families in the neighbourhood (they draw a parallel with L.A.’s light rail Blue line which runs at-grade and does unfortunately have a very high rate of fatalities and accidents)
    3) Consultations were cursory and ignored their concerns, amounting to the project being “parachuted” into a community without properly serving their needs.
    4) Powerful vested interests are ignoring the community’s concerns in part due to systemic ethnic/racial prejudices (this was not so explicitly stated, but I definitely felt this sentiment was subtly expressed in parts of the videos)

    Of course, these should sound pretty familiar. Some of these arguments have been used to powerful effect here in Toronto both in debates over LRT vs subways and the nature of airport services in the Georgetown corridor. The CSC is a bit behind the ball as the at-grade alignment seems pretty far along to be changed now but they are gearing up for a last-ditch push at an important city council meeting this month.

    The balance between legitimate concerns about safety/planning issues and NIMBYism seems pretty subtle to me in these debates. In any case, I doubt we’ve heard the last of these kinds of statements here in Toronto especially as more transit expansion projects move forward.


  8. I recall reading both of those articles recently and have been impressed with what is going on in LA. It seems things have changed a lot since my family and I moved from the LA area many decades ago (this was 1972? – my parents moved there from Toronto when I was 16 month old, so I had no say). We last lived in Altadena (just north of Pasadena) and although nestled in the foothills of the San Gabriel mountains there were many days when one could not see them. During the big debate here at City Council on March 21/22 that settled (for now) the debate on what should go on Sheppard east from Don Mills, I saw on the twitter feed reference to this Youtube video.

    I was quite impressed with it though the air looked too clean from what I “fondly” remember. The big question is whether we can emulate some of what LA has done. While the topic of revenue generators such as levies on parking and sales taxes have at least been discussed here there still is a lot of resistance. Moreover the problem with transit and traffic is a regional one, but the focus seems to be piecemeal “one-of” projects. For all its flaws, “Transit City” did at least look like a network rather than a bunch of ad-hoc mega-projects. It’s a pity that the railway network running through Toronto is rather limited, but there are still some interesting opportunities. The CPR line that runs past Summerhill station and northeast through Scarborough could serve as a potential commuter rail route as one possibility.

    I should finally mention another relevant G&M article I read in the Focus section of this Saturday’s edition of a critique of transit in North America and how we often get it wrong while others get it right or at least less wrong).

    The book cited in this article is reviewed here.



  9. @Phil Piltch – Re: the video of the Gold Line – this is a much better implementation of LRT than was ever proposed for the Transit City lines, with proper station platforms (not tiny islands like St. Clair), reasonable stop spacing (not at every minor intersection), crossing gates at intersections, and lots of grade separation, sort of like Calgary/Edmonton/Ottawa. If we are going to build LRT in Toronto the design of the lines needs to be heavily modified to be more like this to increase speed and capacity, especially on Eglinton. There should be no stops at Ferrand, Lebovic or Ionview. I still have doubts about whether LRT can handle long term growth in demand in a city the size of Toronto though.


  10. @Andrew: regarding the comment

    “There should be no stops at Ferrand, Lebovic or Ionview”

    For the sections where the LRT is at grade, the plan was to have stations roughly 400-500m apart and for the most part having stops at the above streets doesn’t deviate too much from that. Obviously the more stops one puts on a transit line (be it bus, streetcar, LRT or subway) does reduce speed, but the fewer stops does reduce ease of getting to transit stations (need for feeder buses to get passenger there is they don’t drive). As it is the surface section of the Eglinton line will have far fewer stops that the existing #34 bus. Between Birchmount and Kennedy there a large number of apartment building and Ionview is roughly halfway between, so that stop does make sense, given Kennedy station is over a km away. At Ferrand there is a relative new housing development on the south side of Eglinton at that point (though I suspect most likely drive and might not take the LRT) but there is also employment in the area. At Lebovic, both side of Eglinton have large retail plazas (big box) and from the open house I saw the north side is zone as employment, so that seemed to be the rationale for that stop.

    What I did note with LA’s Gold Line was that these were high-platform stations and possibly fare collection was made at the entrance, thus allowing all-door boarding on the trains. It was less clear what the station platforms on the Eglinton line would look like along the surface route – perhaps like those on Spadina or St Clair.


    Steve: The Eglinton line, like all of the TTC by the time it opens, will operate on Presto with passengers validating their fare cards either on board or at machines on the platforms. They will not be doing “pay as you pass” loading like on Spadina or St. Clair. By the way, Spadina is to be revised for the new fare collection equipment — the tender is already on the street.


  11. I too have roots in Altadena. I left in 1984, later than Phil Piltch, but even that late there were days when it wasn’t possible to see the San Gabriel Mountains, perhaps 3km away, from my back yard.

    Unlike Phil (I think), I’ve been back every few years to visit family and friends. In particular I’ve ridden the Gold Line. For getting between Union Station and the Old Town part of Pasadena it’s a big improvement over the express buses that used to be the only (transit) option. For getting to the newer, eastern side of Pasadena, it’s not so good, for the same reason Glencairn and Lawrence West stations on the Spadina subway line aren’t so good: the stations are in the middle of an expressway, with a long walk to any real destination.

    To answer a question about fare collection: as originally built, the Gold Line (like the other LA Metro rail lines) had ticket-vending machines at each station with honour-system enforcement, so passengers can board at any door, and there is no fare collection on-board. Metro seem to have become uncomfortable with honour-system enforcement (I don’t know whether this is based on evidence or politics), and turnstiles have been installed at all stations, even surface light-rail stations. When I was last in Los Angeles, about a year ago, the turnstiles were present but unlocked; I think that’s still the case. The turnstiles are (I think) designed to work only if you have a TAP card (stored-value card analogous to Presto); maybe somebody didn’t think through the implications of requiring every passenger, including out-of-town visitors, to have a special card just to ride the LRT.


  12. The leadership issue seems to be crucial to me. It’s surprising how many projects got done not merely because the voters want it and the advocates are pushing for it, but because some important politician finally makes the extra push to get it done. LA’s Blue Line and Red Line were largely made possible by Kenneth Hahn, just as the more recent lines (Gold Line East, Expo) are largely the work of Villaraigosa.

    In Minnesota, the Hiawatha Line light rail finally left “planning hell” due to the personal intervention of then-Governor Jesse Ventura. I can think of plenty of other examples fairly easily. In contrast, it’s often hard to think of projects, apart from minor expansions, which succeeded *without* a single powerful mayor, governor, or county executive making it his pet project.


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