The High Cost of Going Underground(?) (Updated)

Updated May 17 at 11:00 pm:  Richard Gilbert has responded to this article.  Rather than leave his remarks and my replies in the comment stream, I have placed them at the end of this article.

Urban consultant and former city Councillor Richard Gilbert has an article on the Globe & Mail’s blog titled “How Toronto’s transit plan takes taxpayers for a ride”.  The article decries the high cost of the Eglinton LRT and in particular the high effective subsidy per rider of the capital cost of burying much of the line.

The basic premise, the questions behind the article are sound, but the methodology is not.  This leads to a substantial overstatement of the per passenger subsidy for the capital construction.

At the outset, I must emphasize that my intent is not to attack Richard Gilbert himself, but rather to comment on the pitfalls involved in making comparisons between different systems, and in the use of generic formulas in planning.  In many of the critiques I have written over the years, the hardest  part has been to delve into the underlying assumptions and methodologies (themselves often hidden away in background papers).  These may “prove” something, if only that an author found the number he wanted to find and looked no further.

Gilbert writes:

According to Metrolinx, the provincial agency charged with implementing the transit improvements, the Eglinton line is to cost $4.9-billion (an amount under review). It is forecast to carry 5,400 passengers per hour in the peak direction in 2031, eleven years after it is scheduled to begin operation.

This peak rate is usually associated with an annual total of some 17 million rides. The annualized capital cost of the line is about $300-million per year ($4.9-billion amortized over 35 years at 5 per cent).

Thus the capital cost per ride will be an extraordinary $17.50 ($300-million divided by 17 million). This will be the effective subsidy per ride if the fares to be paid roughly cover the operating costs.

Central to this calculation is the translation of a peak point/hour demand of 5,400 to an annual ridership of 17-million.  The Eglinton route, like many transit lines in Toronto, is not a commuter line feeding unidirectional demand into one point like a GO train.  It is a route (actually several bus routes) serving an overlapping set of demands.  Many riders on the line do not contribute to the peak point count — a peak measured westbound to Yonge in the AM peak will not include any riders using the west end of the line, nor will it include any counter-peak traffic.  Many riders will not contribute to the peak hour counts — the ratio of off-peak riding on the TTC is much higher than on GO Transit even where all-day service is provided.

Any claim that a single peak point’s ridership can be translated to an annual figure will be inaccurate because it ignores the characteristics of the line as a whole. Continue reading