Month: February 2014

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Creative Accounting With Subway Operating Costs

The Toronto Star’s Royson James writes today about automation of the TTC’s subway service and the elimination of train crews. His article includes a figure taken from a paper published by the Neptis Foundation which claims:

Converting the TTC subway to UTO [unmanned train operation] could save about $200 million per year, or $2 billion NPV [net present value].

Installation of PSDs [platform screen doors] might cost another $300 million to $500 million.

[Page 51.]

I wrote briefly about the Neptis paper last year, and keep meaning to return to it if only to debunk some of its more outrageous claims. However, the emergence of fantastical statements about the potential benefits of total automation force me to address this separately.

First off, the cost of PSDs is considerably higher than stated in the report. When this was still part of the TTC’s “above the line” budget, the cost stood at roughly $1-billion (about $15m per station).

The Neptis report says that automation could save “about $200 million per year”. This is wildly inaccurate as can be proven in various ways.

The total TTC operating budget for 2014 is $1.6-billion. Of this, at most 80% of the costs are for labour, and only half of that will be for operators who make up roughly 50% of the workforce. This means we are starting with a total cost of everyone who drives a bus, streetcar or subway train of $640-million. Saving almost one third of this by eliminating crews on the subway simply is not credible.

Continue reading →

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The Gardiner Expressway and Transit to Downtown

The City and Waterfront Toronto are holding a public meeting to present an update on the future of the eastern section of the Gardiner Expressway.

Bluma Appel Salon
Toronto Public Library, Yonge North of Bloor
Thursday, February 6, 2014 from 6:30 pm to 9:00 pm

A media briefing on February 5 introduced the material, and there is widespread coverage in the mainstream press that I will not duplicate here. My interest lies more in the relationship of the expressway to travel demand generally, and to the importance of transit for the future development of central Toronto.

The media presentation contains information that will be included in the public meeting, and illustrations here are taken from that file.

StudyArea

The section of the Gardiner under study extends east from Jarvis Street to the Don Valley Parkway, plus the ramp down to Lake Shore Blvd. east of the Don River. It is important to remember what is not being changed.

  • From Jarvis Street west, the existing expressway will be rebuilt under a multi-year program stretching to about 2019.
  • The south end of the DVP will be modified only to the extent needed to connect in with whatever new or revised structure might be built.
  • The ramp down to Lake Shore will remain in its current form except if the Gardiner is removed, in which case the ramp will be demolished and a new Lake Shore will cross the Don on a bridge at grade.

The Gardiner’s design capacity was scaled for connection to a future Scarborough Expressway that was never built, and the structure east of Jarvis is wider than is needed for the demand. This section gives the greatest opportunity for reworking, and releases the most land around the expressway in any new configuration.

Continue reading →

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Sir John A. Station?

Yes, we must be into the mayoral campaign, even among undeclared candidates.

At today’s meeting of Toronto’s Executive Committee, Councillor and sometimes-mooted candidate for the Mayor’s office, Denzil Minnan-Wong (better known as DMW to the blogging community) walked a proposal into the meeting to rename Union Station as Sir John A. Macdonald Station.  It’s a slow news day, and this is the sort of thing we see at City Hall when the Ford Family hasn’t triggered any new scandals.

Never mind that this is a National Historic Site.  If someone wants publicity, why not pick a great big monument and propose a new name for it?

Don’t ya know that old Sir John A., our first Prime Minister, is coming up on his 200th birthday, and what better excuse to rename the station after that master of the Canadian Pacific (despite the fact the railway was built long, long before the current Union Station even existed).

It seems there is a group called the Toronto Friends of Sir John A. Macdonald who, along with “appropriate groups and individuals”, are to be consulted in the preparation of a report on the subject that will be back at Exec by July 2 at the latest.  This group even has a website with one rather trivial post that is over a year old.

According to The Star:

Supporters include Alan Broadbent of the Maytree Foundation, broadcaster Steve Paikin and journalist Richard Gwyn.

They should be ashamed.  Just because “Union Station” seems rather prosaic does not mean the name is without significance in Toronto.

No doubt, part of the impetus for naming anything in Toronto after Sir John A. might be his reputation for drinking gin (conveniently disguised as a glass of water) in the House.  A role model for our current Mayor, no doubt.

Poor DMW is doomed to be one of the also-rans in the mayoralty race, presuming he even puts himself on the ballot.  The things people do to get attention.  At least he has not changed his mind on transit funding and jumped on the subway bandwagon, yet.

This proposal is a waste of time for staff and Council who have far more important things to consider.

Leave Union Station alone!

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Toronto’s 2014 Budget & The TTC

On January 30, 2014, Toronto Council passed its 2014 operating and capital budgets.  In earlier articles, I discussed details of the TTC budgets and won’t repeat that info here.  However, a few details from the City budget debate are worth mentioning.

Scarborough Subway

Three Councillors attempted to sideline spending on the Scarborough Subway project by redirecting the planned $14-million in the 2014 budget either to a reserve or to other projects.

All of these motions were ruled out of order by the Speaker based on advice from City Legal staff who argued that since Council had already passes a special tax to fund the Scarborough Subway, they would be open to a lawsuit if the money were not spent for the intended purpose.  This ruling by the Chair was challenged, but the Chair was upheld by a vote of 23-22.  This is the same margin as in a previous vote on the issue, although a few Councillors switched sides.

I feel that attempts to derail this project are counterproductive at this time for several reasons:

  • Like it or not, Council has approved the Scarborough Subway project and its associated tax.
  • The issue is very contentious and in the current political environment quickly becomes a “Scarborough against the world” debate.
  • The cost estimate for the project is barely beyond the back-of-the-envelope stage, and this cannot be refined without further study that will occur in 2014 as part of the lead-up to the Environmental Assessment.  This will include comparative costs and effects for the City’s McCowan alignment and for Minister Murray’s “SRT” alignment.
  • If the cost of the subway proves substantially higher, this will certainly trigger a further debate at the 2015 budget sessions under the newly elected Council who must approve the next stage of the subway tax increase.  Any increase must be paid for with 100-cent City dollars because the commitments by Queen’s Park and Ottawa are capped.

Other related issues include:

  • The projected demand for the Scarborough Subway must be seen in the context of other regional plans that are under discussion.  These include substantially better service on the GO Stouffville Corridor.  An EA for double-tracking this line is already underway, and the corridor is part of the “Big U” that is under study as part of Yonge subway capacity relief.
  • The claimed shutdown period for the SRT for conversion to LRT has been inflated from the 2.5 years anticipated by Metrolinx to 4 years and beyond by subway advocates.  Any discussion of the LRT alternative must include a review of how long a shutdown really needs to take, but we are unlikely to see this given that the only authorized work for 2014 will be on the subway options.  Any work to make the LRT option more palatable would be viewed as backsliding by subway supporters.

The whole project will be back at Council again in 2015, and that is the time for a well-informed debate on alternatives.

Operating Subsidy

When the TTC Board approved its 2014 operating budget, there was a $6-million unspecified reduction in the expected subsidy based on a recommendation from the City Manager.  At the time, both TTC Chair Karen Stintz and CEO Andy Byford said that they would fight for the missing $6m, although we never found out exactly what the effect would be if the TTC didn’t get it.

The original 2014 subsidy proposed by management in the budget (November 2013) was $434m, up from a budget level of $411m for 2013. The Board passed a budget with a $428m subsidy.

The CEO’s report for November also predicted a $411m subsidy requirement for 2013, but probable actuals reported in January show that the system came in $7.3m below this number, at $403.7m.  Whether these savings are one time effects or sustainable into future years is a matter of debate (one unexpected source of revenue was the sale of retired subway cars).  The TTC does not distinguish between regular and extraordinary revenues, and some savings or costs (such as the actual vs budgeted cost of diesel fuel) vary with market forces.

In any event, for the second year running, the TTC’s actual subsidy requirements have come in below projections.  This makes the increase from previous year’s actual to current year’s budget bigger than simply a budget-to-budget comparison would show.

In case anyone is tempted to ask why the TTC cannot do “a better job” of budgeting “accurately”, that $7.3m is less than half of one percent of the total 2013 budget of $1.541-billion.  If your own personal finances operate at such a level of accuracy or better, then maybe you have a right to complain.  However, given that even a small percentage variation for the TTC turns into what, for Councillors, is a huge amount of money, debates about the TTC budget often turn on the minutia.  $6m represents 0.25% on the property tax rate.

Among several budget adjustments proposed by Deputy Mayor Norm Kelly and approved by Council, the TTC received an extra $3m for a new budgeted subsidy of $431m.

Council also passed a motion asking staff:

… to develop an intergovernmental campaign to advocate for a Provincial operating subsidy in line with pre-1995 levels.

$70m of Provincial subsidy now goes to the TTC operating budget as part of the City’s subsidy.  This is well below the formula instituted by Premier Davis in the 1970s of a 50% Provincial share.  A catch-22 here is that slavishly holding to a percentage allows Queen’s Park to dictate the size of the total budget by specifying an absolute limit to the dollar value of the subsidy.  This can artificially constrain the growth in TTC service.

Capital Budget

The Capital Budget was passed including over $2-billion in cuts (shifts of projects and funding to “below the line” over the coming 10 years.  Some of this lies in large projects that have yet to be approved, but a substantial amount comes from purchase of new vehicles (buses, streetcars and subway cars), garage/carhouse expansions and facilities maintenance.  $10m per year has been cut from streetcar track maintenance in 2014-18, and from subway track maintenance in 2019-2023.  In the out years, this is accounting hocus-pocus designed to make the capital spending fit within available target levels, but in the short term, this threatens some necessary TTC work.

The City and TTC will continue to beat their drums for added support at Queen’s Park and Ottawa even though, at least in the short term, this is likely to be more wishful thinking that productive lobbying.

Toronto has a self-imposed debt limit that arises from a desire to keep debt servicing costs at an affordable level relative to tax revenue.  Of course, if Council wants to raise taxes, they can also raise the amount of debt as they have done for the Scarborough Subway.

Affordability of Transit Fares

Council passed a motion asking several City departments and agencies, including the TTC:

… to report in advance of the rollout of the Presto Fare Card system and prior to the 2015 budget process, on options related to a fare media policy that addresses affordability issues of transit fares for low and moderate income Torontonians.

This topic comes up regularly at TTC Board discussions, and the common TTC response is that social benefits are not in the TTC’s purview.  With the move to smart card fare collection, there is an option to build fare subsidies into a rider’s account and to allow such subsidies to be tracked.

The question, as always, will be whether TTC funding should go to improvements in service and/or fare structure for all riders, or be targeted to those who receive some other form of social assistance.