This article was updated at 2:00 pm on October 2, 2020 to include remarks from Metrolinx CEO Phil Verster. Scroll down the end of the article to see the update.
In the Toronto Star, Ben Spurr reports that the opening date for the Crosstown line has been delayed five months to 2022, and even then it will open in stages.
Metrolinx, the provincial transit agency overseeing the project, conceded earlier this year that the $5.3-billion, 19-kilometre LRT across midtown won’t be finished by the previously announced deadline of September 2021. Metrolinx says it now expects the line to open sometime in 2022, but a firm date hasn’t been set.
But according to a new report, Crosslinx Transit Solutions, the private group contracted by the province to build the line, has floated a plan for a phased opening. It would see most of the LRT in service by Feb. 28, 2022, with the exception of Eglinton station, which wouldn’t be fully complete until September 2022.Source: Toronto Star
Construction watchers might see this as a confirmation of what they see looking at slow progress at key sites, but there are more important issues at work here.
The news came not from Metrolinx itself, but from a notice from Moody’s Canada that it was downgrading its rating outlook for Crosslink Transit Solutions “to negative from stable owing to the likely delay in the completion of the Eglinton LRT Project”. The rating of CTS debt is not changed, only the outlook for potential updates.
At issue is the question of how much of this delay’s cost will fall to the P3 partner CTS and how much to Metrolinx and the Government of Ontario. To the degree that CTS must absorb this, their financial situation would be weakened.
An intriguing point in this announcement is that the value of affected debt is cited as $731.9-million (Canadian), a relatively small part of the total project cost. The entire P3 concept was sold on the basis that financial risk would be transferred from the Province to its partners.
According to the Star, CTS has claimed extra costs for a variety of delays such as unexpected conditions at Eglinton Station and labour constraints due to the pandemic. Metrolinx denies these claims, but if they eventually do pay out, it would not be the first time.
Various dates are cited by the Star for the line’s opening:
- February 28, 2022: The date for opening most of the line, except Eglinton Station, according to Moody’s report
- May 2022: Completion of most of Eglinton Station
- Fall 2022: Direct connection to the existing subway station opens
What is not clear is whether the February date includes provision for testing and acceptance of the nearly-completed line by Metrolinx.
Between May 2022 and opening of the subway link, passengers would have to transfer by walking on Eglinton between the existing subway entrance and a new entrance building to the LRT station.
For some time, the Metrolinx page for the Crosstown project cited an expected completion of 2021, but in March 2020 this was changed to 2022. This problem has been brewing for some time. Spurr reported the delay in February 2020 (see Eglinton Crosstown faces another setback, delayed until 2022).
The original target for substantial completion of the contract was September 2021, but there is an 18-month window to the “long stop date” when the agreement could be terminated. Now, only six months remain in that window. What exactly Metrolinx would face if they pulled the plug is unknown, but this would leave a nearly complete line tangled in legal problems.
The TTC and City of Toronto face ongoing costs for the service implications of the construction project, but this would be offset by a delay in the point where Metrolinx would begin billing the City for the line’s operation and maintenance (the TTC will only be directly responsible for part of this work).
“Metrolinx is focused on ensuring that (Crosslinx) fully meets its obligations to deliver a system as soon as possible — a system that is complete, fully tested and ready to provide high quality, safe and reliable service to our customers,” said Metrolinx CEO Phil Verster in a stern statement.
He said Crosslinx “has not achieved necessary production rates to achieve the original project schedule” and Metrolinx “will continue to hold (the consortium) accountable for these delays.”Source: Toronto Star
Metrolinx may take a hard line attitude to non-performance by CTS, but more than bluster will be needed to achieve project completion. The expected June 2022 provincial election will bring considerable pressure to provide a ribbon cutting for Premier Ford at whatever cost is necessary.
Updated October 2, 2020 at 2:00 pm
Metrolinx has issued a statement from CEO Phil Verster through the Metrolinx Blog.
This includes the following comments:
Transit projects are delivered on-time when the contractor achieves the production rates they committed to and only through the proper management of their own logistics and operations. In the case of Eglinton Crosstown, our building partner, Crosslinx Transit Solutions (CTS), has not achieved necessary production rates to maintain the original project schedule that they committed to in their bid.
Any suggestion, like the one made in the Moody’s Credit Opinion, that the line could be considered ready to open without the ability for passengers to get on or off at the flagship station at Yonge and Eglinton, where tens of thousands of passengers will transfer on a daily basis between the Eglinton Crosstown and the TTC Line 1 Subway, is completely a distraction and is not in line with the obligations CTS took on when it signed the contract.
It is imperative that CTS now focuses on getting the project completed, including Eglinton Station, to the highest quality standards.Source: Metrolinx Blog
It is clear from this statement that Metrolinx is taking a hard-line attitude to the current state of the project. Whether this will provoke improved performance by the CTS consortium, or create a logjam in negotiations remains to be seen.
This is among Metrolinx’ largest projects, and if the P3 is unable to deliver as promised, this will undermine the credibility of this method of project delivery. However, what could also happen is that industry’s appetite for such undertakings and especially for assumption of risk may be reduced threatening the bidding process for other projects including rapid transit lines and GO expansion.