Updated October 4, 2012 at 9:20 am:
Mr reaction to the announcement yesterday that TTC would remain as “operator” of the LRT lines is on the Torontoist website.
Although the TTC sees this as a “good news” story, I am less impressed because Toronto is still very much the junior partner. We get to drive the trains, and that’s about all. With all maintenance remaining in the hands of Metrolinx private partner, whoever that will eventually be, this is a big step in outsourcing transit operations.
Updated October 1, 2012 at 10:00 pm:
The Toronto Star reports that discussions continue between Metrolinx, the City of Toronto and the TTC regarding the possible operation of the planned LRT lines by the TTC rather than a private contractor.
Exactly how much “operation” would entail is not mentioned, although the TTC is known to be concerned about responsibility for safety-sensitive systems such as vehicle, signal and track maintenance.
A related issue is the amount of detail that must be worked out before a master contract is let by Infrastructure Ontario. If the private work ends when operation begins (with possible exceptions such as building and station maintenance), then this is a much simpler contract to draft than one that would require all of the details of future operations to be bundled with a design and construction contract.
Whether Queen’s Park and Metrolinx are aware of or care about the delay inherent in needing to specify so much detail so far in advance for a single contract remains to be seen.
September 21, 2012
My thoughts on recent announcements that Metrolinx would completely take over the LRT projects formerly part of Transit City are in an article on the Torontoist website.
Steve Munro 
First off I do like your website a lot Ray, THEY (Metrolinx or whoever) will either go with union guys or not. Of course Unions can/will try to muscle in after the fact, but in the beginning they will go with union men or not. Who knows what will transpire..unions tried for Dominion and it worked, unions tried for Walmart and it did not work. I also do not think the status quo will remain. I’m willing to bet Metrolinx may just may have a say. In any event as I said they will hire who they want, and AFTER, a union may come and try and represent workers.
More to the point, in 12 years will there be a TTC like we know it? I don’t know what the future of the current TTC is, but I do bet it will be a lot different than it is now. Being an old guy, I like and respect history, be it heritage buildings or whatever and I do think we can learn from the past. I would say that quite a lot, maybe even most of the ‘new’ generation, my kid included, seem to have no understanding of history and frankly do not care about what transpired and why in the past. They think they can do it better. It is all around us, there is a new, not better, world coming our way, it maybe even be 1/2 here already Ray.
As Steve pointed out, we (Toronto/TTC) has now lost control/operation of the Scarboro RT/LRT and on and on it goes. Assuming the TTC still exists, do you really think someone will stick to their word and it will ONE fare between LRT and buses within the City? It may not even be LRT any more. I believe it is now an entirely new, or the beginnings of an entirely new transit ballgame in this City and with new games comes new rules, most of which you usually find out about much later on in the game, when it is too late to do something about it. A 17 yr old kid will be 30 yrs old and possibly even be Mayor of Toronto when these lines open. A lot can happen.
Of course I guess the opposite is true also, there will probably be 2 new Provincial Governments before any of these lines open so I guess either one could say screw it, we don’t want any part of it? Who knows.
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After decades of political squabbling and inaction it looked like Toronto would finally get some much needed new transit infrastructure. Instead, what we have is more political squabbling and what looks to be a disaster waiting to happen with the privatization of the yet to be built LRT lines and the old, soon to be reconstructed SRT line.
When it looks like progress is finally being made, we have people or organizations who pop-up and throw everything off the rails.
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Just a question about switching from LRT to ICTS/ART or whatever? Didn’t Kitchener Waterloo tack a 14 car Flexity order on to the end of the Metrolynx LRT order for Eglinton/Scarborough? What happens to that order? Would Bombardier build a 14 car order or is Metrolynx going to take over all new rapid transit/LRT construction and farm it out to outside private companies in a frenzy of DBFOM contracts?
Given the Liberal’s track record for E-Health, ORNGE, gas turbine powered electric peaking stations, paying foreign utilities to take our excess electrical energy, solar and wind powered energy at many times the going rate etc.; can they be trusted to get this operation correct? I doubt it. The Tories gave us the 407 contract and Walkerton Water so they don’t have a good history either.
I hope that there is a provincial election soon and the Hudak self destructs before it happens.
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My biggest concern over any private operators of the new LRT lines is whether the contract(s) will include minimum ridership guarantees and would the TTC be strong-armed into propping up ridership numbers as a result.
For example, if the Crosstown starts to struggle, will the Warden to Kennedy section of the BD line suddenly need “emergency tunnel repairs”. Also, would bus routes be rerouted or eliminated for the same reason; such as cutting the Kennedy and Midland routes south of Ellesmere for example.
Steve: Much depends on the nature of the contract. If it is service based, with provision for adjustment as ridership grows, then the contractor has to figure out how to run headway “x” most effectively. If it is capacity based, then “there’s still room on the roof” rule kicks in. The next wrinkle will be whether the city could opt to pay a higher subsidy to get better service, but I suspect Metrolinx is nowhere near thinking about that sort of thing.
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Well, given how much political capital has been burnt on trying to push forward projects that alienate the very public that the projects are meant to serve it is unlikely that any of the LRT projects would survive a provincial election that brings in a new government.
However if you are in fact truly serious about the Eglinton LRT and the role of transit in this city you will take my simple advice.
First, you must bring MODERATION to the debate; a highly polarized discussion will end in failure.
Second, the future of transit in the GTA requires cooperation between all the respective agencies. Cooperation and integration between the agencies will be extremely powerful given the needs and realities in the GTA.
Third, to paraphrase Henry Kissinger you must bargain in the pursuit of the possible, a hardliner pursuit of the ideal will likely end in failure.
As for the current transit plan it seem as though the vultures are circling it high overhead. The only way to success is through moderation, cooperation, and compromise. Without these three pillars of success the vultures are going to have a great feast.
Steve: That sounds like a nice theoretical political science discussion, but it does not speak to the way politics and the balance of power in Toronto and Ontario actually operate.
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We live in a city where that approach now gets you called a latte sipping downtown NDPer, even if you live in Scarborough, like your coffee black, and vote Tory.
I’m not a real fan of a certain councillor, but when he mentioned in one debate how transit was being built on “magic beans”, he was right.
Reality is not what we would wish, but it’s all we got.
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So are the TTC and the city going to just sit idly by and let Metrolinx off scot-free over this or will they put up any kind of fight over what Metrostinx did to them?
Steve: I suspect the city and TTC will sit on their hands. TTC’s position is compromised somewhat by past actions of staff (the earlier doom-and-gloom report) and the Commission (One City’s GO line takeover). Council has no mechanism to launch a quick and sustained attack, unlike the mayor’s office which is totally uninterested, if not quietly gloating at Stintz’ discomfort.
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All too true, but very sad as well. If they don’t change, the region will continue to suffer from poor productivity growth, underutilization of human capital, and increasing socio-economic polarization. Without the proper management of public resources the region will fail.
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You are right, but I need to add that history is littered with societies that grew too polarized to warrant their own existence and they all end up in the waste bin of civilization. Reality is not some arbitrary phenomenon; it is defined by those who experience it. If you want a better reality you must be wise, strong, and bold.
Steve: I do not think that the Metrolinx takeover deserves the attention or will have the same effect as the decline and fall of the Roman Empire.
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One anecdote about London – I have no idea if this is a one time exception or fairly common. I was in the “tourist seat” in the second row of the upper deck of a bus in London taking it easy and admiring the view. I couldn’t sit in the front seat as there were two bus drivers chatting away. One of them was new – at least to this route – and the other was providing pointers about where to turn, which streets were narrow etc. At one point the conversation turned to a particular supervisor who “hates to miss a run”.
I am not sure if the private sector partner was paid by the run or if there were penalties for not making a run. In any case, the discussion was about the importance of maximising financial return for the supervisor in question. According to these two drivers – and they share several examples between them – buses with safety defects were pressed into service in order to maximise income.
This was not a rancorous discussion – both men were completely calm and discussing everyday reality rather than making political points. As we are finding in Toronto, efficiency and worse efficiencies have many impacts beyond saving money – and many of them are undesirable. (And that is assuming that in the end any money is actually saved.)
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A note on KW’s LRT: they are most likely going to go ahead with a full DBFOM for their LRT line, with the exception of the vehicle order and utility relocations (which happen next year).
Also, I don’t believe Metrolinx has any real say over KW’s line, except in the case of the Bombardier vehicle order. Transit outside of the GTHA (with the exception of GO lines) doesn’t seem to fall inside the Big Move’s sphere of influence.
Steve: Metrolinx may not, but Infrastructure Ontario is quite another matter.
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Hasn’t work already started on the Eglinton LRT? The tunnel boring machines have been ordered, and I believe a hole is being dug to insert them into the ground. So, is the idea to transfer any WIP to the successful private partner sometime in the near future?
Steve: Yes. The contractor will take over responsibility for the tunnels when they are physically completed. Installation of track, signals, power, etc. will be part of the new contract according to Metrolinx.
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Several others have mentioned the Kitchener-Waterloo LRT in the context of wondering if Metrolinx may make moves to take over everything there as well. It is important to remember that unlike the Toronto lines where the province holds all the money (except for $333M from the feds), the K-W LRT is roughly an $800 M project where the region will be funding almost $300 M and the feds about $265 M. I strongly suspect that leaves Metrolinx with a lot less leverage to call all the shots.
As for the LRV order which was piggybacked on the order for Toronto to get a price advantage, I suspect this would not be an issue if Metrolinx made a switch to ICTS/ART for the Eglinton line. Think about it: if you were Bombardier and wanted a good showcase for your ICTS/ART product, wouldn’t providing 14 LRVs for the K-W project for the price of a larger order instead of the price for a single order of 14 LRVs be worth it?
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Wouldn’t such a substantial revision of the Eglinton project (LRT to Bombardier ART) require a new – and potentially lengthy – EA? If that is the case, such a change will clearly result in significant delays, and I am not sure how politically tenable that would be.
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The province was always in favour of ICTS/ART technology for the Eglinton Line. I believe they silently supported Rob Ford decision to make the entire line grade-separated, because this way it provided Metrolinx with an opportunity mask their true agenda which would be to tender out the build, operation, and ultimately the switch of technology on the cross-town line. The fact that Council voted against Rob Ford plan and reverted back to the original “at grade plan” ruined their plan and forced Metrolinx and the province to come out of the woodwork, and state their true agenda.
This should come as no surprise because I remember back in 2008 when the Regional Transportation Plan was leaked out, Metrolinx originally wanted to build a fully grade separated line on Eglinton. If my memory serves me correctly, the TTC and Metrolinx were in a huge tug of war at the time of what to do with Eglinton.
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That being said what are the implications if these line ever cross into other municipalities in the future like Mississauga, Markham or even Pickering?
Steve: Given the relatively small size of transit operations in the 905, I think they would be happy to have Metrolinx build and operate any rapid transit routes. Paying for them is another matter. We have already seen arrangements between York Region and Toronto whereby the TTC is entirely responsible for operation and maintenance of the Spadina extension north of Steeles in return for revenue that won’t begin to pay operating, let along capital costs for future major repairs.
I suspect there will arm-twisting by Queen’s Park to offload some future costs on the regions unless the money comes from the long-promised GTA-wide “Investment Strategy”.
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Deborah Brown asked,
I suspect so, but what I fear is that they have already extended the schedule for this line out far more than needed for LRT technology, and it may be very possible to go through such an EA process and construct an ART line under the new schedule.
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Steve:
Mississauga’s mayor has already pointed out (last week in her State of the City Address) that Mississauga is going to have to borrow to pay for the Hurontario-Main LRT.
K-W has already ordered vehicles for their LRT, and I suppose that Hamilton, Mississauga & Brampton as well as Bombardier and Metrolinx and the Ontario Government would not mind if the cities got their LRTs paid for in some kind of poli-swap.
I can see Missisauga & Brampton also wanting Metrolinx to run Hurontario-Main because it avoids any thorny issues of revenue & cost sharing between the two cities over the LRT … not to mention the possible mention of a “Peel Transit”
Cheers, Moaz
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Steve, given that one of your longest-standing major concerns about Metrolinx has been their lack of transparency, openness to public scrutiny and secrecy in how they conduct their affairs and make their decisions, it is now well past the time when their feet must be put to the fire and they be required to renounce once and for all their behind-closed-doors style of management – it can no longer be tolerated.
Public accountability and transparency on the part of Metrolinx is essential, now that they’re taking on the full responsibility for building out the new, agreed-on transit lines. This is a new game, and Metrolinx needs to be made far more open and responsive to the public. At the very least, City Council should insist upon this concession from them.
Steve: I agree, but that’s not how Queen’s Park does business. I would be surprised even if the NDP somehow came to power we would see a change in Metrolinx’ behaviour. It suits the province to do things behind closed doors even though they require municipalities to be almost wide open.
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Well, then, this cult of secrecy and nefariousness is the primary reason why so many of us here are greatly disheartened at the future prospects for these new lines. City Council, Karen Stintz and the TTC, not to mention the citizens of Metro Toronto, must feel they’ve been “had,” and big-time at that.
Put bluntly, this latest turn of events is likely to prove a stinking, rotten shame – when it most certainly should not be!
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This motion is coming to City Council next week.
Steve: To which I say “good luck” considering that the city has little hold over Metrolinx, and the TTC has already incorporated the shutdown of the department doing the planning for these lines in their 2013 budget.
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Neil said:
Steve replied:
I don’t understand. The TTC has all the staff and expertise necessary to design and cost-estimate things like these, no? Why would they be less qualified than a private bidder?
Steve: They would not necessarily be less qualified, but they don’t have a staff whose responsibility it is to prepare responses to bid calls. For very large contracts like this, the cost of a response could easily be in seven figures, and the risk of losing is borne by commercial companies as part of the cost of business.
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Steve:
But hasn’t a lot of design work already been completed anyways, such that the TTC has a lot less work to do in its bid work? Or did they not get past the 30% design stage for any of the lines?
Steve: Bidding to act as a contractor providing service is completely different from designing the line.
Also, it’s being suggested in the media that a bid by a public agency would naturally be lower than competing private bidders for two reasons:
-Public agencies can borrow money at a lower rate than private firms, and
-Private firms would charge a lot more to take on high-risk work (other departments and utilities are present in the public right-of-way, and my logic is that a public agency like the TTC is in a better position to liaise with these stakeholders than the private firm).
One of the major benefits that is not listed here is that if a private partnership were never going to happen in the first place, Infrastructure Ontario would not take one year (that’s their figure, not mine) extra to create the proposed contract just to ensure that the private company would perform functions we take for granted with a public agency.
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The reason why business is perceived as more efficient then government is because they are much more secret. There is no access to information law for business.
In order for Metrolinx to be perceived to as efficient as a business, they much operate as secretly as a business does.
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I wonder if Queen’s Park/Metrolinx is slowly engineering a takeover of the TTC and what we’re seeing now is the first movement towards Metrolinx becoming a SEPTA style agency operating city and commuter transit, including collecting municipal subsidy money.
I’m also beginning to worry about the future of the Finch LRT line. Eglinton, Scarborough RT, and Sheppard form one nicely integrated network but Finch is isolated from the main network much like the Eglinton trolley bus lines were, and will require a whole support infrastructure for one line. Originally, I was worried it might get cancelled because it shares no infrastructure with any of the other lines, has no federal money associated with it (Sheppard), is not required to replace an existing rapid transit line (Scarborough RT) and has no investment in heavy construction equipment (Eglinton TBMs) so I could see the provincial government offering to kill it to get Conservative votes to pass a budget. Now, I can see the private sector being reluctant to bid on a package that includes it for the same reasons so I wonder if Queen’s Park might end up dropping Finch if the private operators they’re courting don’t bite with it included. I seriously hope my concerns don’t come to pass but that said, if the Finch LRT does get cancelled, my expectation would be statements from politicians talking about how the community up there can’t complain about being neglected when they’re getting a brand new subway station at Finch West and how great that is.
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While this doesn’t surprise me, I was caught off guard by this… How is Metrolinx going to insure that we don’t pay more?
Steve: At this point, until Metrolinx and Infrastructure Ontario actually get bids for the rest of the LRT lines’ construction and operation, we have no way of knowing that their cost estimates are accurate. Moreover, the numbers they quote do not include inflation, and that can hide a lot. All the wage-freeze legislation in the world will not stop costs from rising in the construction industry.
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How much does Metrolinx (Ontario) put in as an operation subsidy (as opposed to a capital subsidy) to the TTC? If they put in an equal or greater amount than the city, I would listen to what they would say. However, if the city pays the majority of the operational subsidy, they belong in driver’s seat (through the TTC).
Of course, if the province pays even a token amount, then other municipalities would want their share as well.
Steve: Zero. Queen’s Park gives Toronto about $160m in gas tax revenue, and the city allocates $90m of that to the operating subsidy. The rest goes to capital subsidy. Comments from the Minister imply that Metrolinx expects to get an operating subsidy from Toronto based on the saving from discontinued bus routes.
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I can’t help but wonder if this is all part of a ploy to ensure that the city doesn’t change its mind again with the LRT lines. Basically, they are making it clear that if the city tries it, the province is more than willing to go it alone.
Steve: Given recent events (the TTC is back in the operator’s seat for the new lines), I’m not so sure of a grand plan.
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We seem to be back to Square 2 again.
From National Post:
Steve: I don’t think this deal is quite the wonderful new world the TTC sees it, but rather a politically expedient way to make the issue go away. More commentary coming on Thursday in the Torontoist.
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Well that was brief, now TTC will be operating the Transit City lines after all. Can Metrolinx finally get on with building them now that this is settled or does this change the private sector tenders from design-build-operate to design-build only, and leave the whole time consuming process for private sector involvement in place?
Steve: TTC will only be operating the lines — driving and dispatching the trains, manning the stations, providing central control services. They will not be maintaining anything. That is still in the private sector.
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Nick L. wrote,
With the long project time for major transit projects, there have been calls for some sort of mechanism or body that oversees such projects that is not subject to the whimsy of a new administration, at whatever level of government.
I do think that suggesting that is a motive here is giving far more credit to either Metrolinx or the province than they deserve.
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Steve:
For now they appear to be back in the driver’s seat, however, in ten years there will be no Kinnear, no Dalton, no Ford, no Hudak, no Harper, 1/2 the current old guard at TTC , both management and operators will have retired , probably at least half of the current councillors will be long gone and on and on …
I think there is still so much up in the air, do not take anything for granted here.
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How can they have reached a decision so quickly on who the operator would be? This seems to right-out defy the very recommendations and logic of what the TTC staff have been warning against since May. I doubt that even this isn’t final.
Steve: The only thing they have decided is that the TTC will be responsible for driving the trains, managing the service and manning the stations. All maintenance will be contracted out, and the proposal call for that won’t be written until sometime in 2013, let alone awarded to anyone.
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Ok, so the TTC is going to operate the lines, but it is possible that some other contracts related to operations will be contracted out.
So my questions:
1) Could this about-face have something to do with the provincial law that grants the TTC a virtual monopoly on street-side public transit in the city of Toronto … hence, having a private operator would require a change in the law?
Steve: It is the City of Toronto Act, and the TTC monopoly has an exemption for provincial agencies like Metrolinx.
2) If the contracting out is of minor services like cleaning, how much different will this be from what is being done to the TTC right now? And more importantly, will there be protests if some workers in public transit are unionized and some aren’t?
Steve: All maintenance will be contracted out.
3) If the contracts are minor in size & scope, how likely is it that there will be any money savings from contracting out? Isn’t it possible that the bidding process, risk assessment and sureties (not to mention the possibility of cancelling the contract & having to find another operator lickety-split, like what happened to Melbourne’s Yarra Trams and Connex–now “Metro”–train operators) might actually cost more than just having the TTC do the work in-house?
Steve: It is the received wisdom of the magic of private sector operations that they are always more efficient than public sector ones. At least they are good enough about making up stories in bid books and hoping they won’t be held to account later.
Cheers, Moaz
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I seem to feel déjà vu here, though I am not sure why.
One agency makes a sudden announcement that they will move ahead without the other agency. Talks take place over a couple of weeks where the excluded agency comes around to something the first agency wants, then another announcement is made that they will be working together afterall.
My question here is: what did Metrolinx want out of the TTC that the contracting out announcement pushed them towards?
Where have we seen this before? Recall when the TTC made an announcement that they were going it alone on a project to implement an open payment system for a fare card. At the time, Metrolinx was not very open about what new technologies would or could be implemented with Presto, but within a couple of weeks of the TTC’s announcement, Presto was suddenly adaptable to new technologies and it was announced that the TTC was dropping their go-it-alone plan in favour of Presto.
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I am less impressed because Toronto is still very much the junior partner.
The relationship between Toronto and Metrolinx is not a peer to peer relationship, nor should it be. If Toronto is to be properly represented it needs greater influence from WITHIN Metrolinx. Personally, I feel that Metrolinx needs to be given greater powers to be able to push forward a timely, reasonable agenda. The existing relationship between a provincial agency and a municipal government is at best clumsy and inefficient. The trick however to giving the agency more power is to be able to ensure proper representation and fairness for all its stakeholders.
Steve: Once upon a time there were politicians on the Metrolinx board, but Queen’s Park claimed that this was not working and replaced the board with a set of, mainly, private sector reps who would bring their business expertise to Metrolinx. They may be doing this, but they do so almost entirely in private meetings, rarely challenge staff positions in public, and never provide any representation for municipal interests.
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Do you know of if any examples of DBFM (without the O) exist? All P3 projects I can think of has the O.
If no examples of DBFM exist for transit lines, then whoever is saying that this model of AFP has been proven extensively is flatout lying.
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Mikey said:
I don’t know how specific you are looking at (e.g. in North America only) but here are two examples I’m familiar with:
Kuala Lumpur Malaysia’s new Sungai Buloh – KL – Kajang line is owned by the Government’s “MRT Corporation” and being built in “packages” given to various private contractors, but operations will be by RapidKL, the subsidiary of Government-owned “Prasarana” (the National Infrastructure Company”.
Singapore’s new Downtown line and earlier City Circle line appeared to use similar section-by-section packages. Operations for the City Circle Line were given to SMRT Corp (which runs the East-West and North-South Lines and Chua Chuo Kang “LRT” as well as SMRT bus services) and I believe the Downtown Line will be in operated by SBS Transit Corp. (which also operates the North East Line, Sengkang and Punggol “LRT” line and various bus services).
SBS Transit is a subsidiary of ComfortDelGro which also operates taxi cab and shuttle bus services (Comfort) in Singapore as well as urban bus services (Metroline) in London, UK.
Cheers, Moaz
Steve: I am not convinced of the validity of a “big bang” approach to contracting out these lines. We have been building subway infrastructure for decades and somehow, magically, it does not fall apart five years after it is built. The irony is that the eventual operator for all existing lines has also participated in the design, although a lot of the work is done by contracted engineering firms. People who build structures are not necessarily (or likely) to know anything about operating railways, and it would not surprise me to see a lot of the maintenance work hived off to a subcontract anyhow. Far too much of this discussion is based on ideology, on what must work to prop up the idea that the public sector is incompetent to deliver any service.
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Yikes … if I were the TTC I’d be making sure that the maintenance contract is very well written … nothing like getting in your streetcar in the morning only to have the wheel fall off and the track all warped … oh you’re engine oil pressure light is on … that’s normal, no big deal … we’ll fix it when the contract says we’ll fix it … not a second before.
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It looks like Queens Park is hoping for the Federal Government to kick in some money with a national transit strategy.
Steve: Yes, amusing that the Liberals have picked up an federal NDP slogan.
When David Miller announced Transit City, did he/City Council always intended for the province to pay for 100% of it? Or did the Province offer this funding arrangement afterward?
Steve: The assumption was always that it would be a shared project, ideally three ways. Queen’s Park’s offer to pay 100% was icing on the cake, although as we have seen, it came with a loss of control and delays in implementation.
And how feasible would it be for City Council to foot at least part of the bill the next time projects on the scale of Transit City are proposed?
Steve: That depends on how much Toronto wants to tax itself to pay for things like this. One third of a Transit City sized project would be considerably more than we are paying now on things like the Spadina Subway extension or the new streetcars.
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