Day: January 22, 2022

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TTC Budget and Ridership Update: January 2022

Toronto Council’s Budget Committee has been working through budget proposals from all departments and agencies in recent days. On January 19, it was the TTC’s turn.

Normally this step in the slow march to Council approval is simply a rehash of material presented at the TTC Board. However, in light of the return to greater restrictions on public gatherings, there has been a drop in ridership significant enough that the operating budget has been updated. This article reviews the changes.

Previous articles:

Ridership, measured as a percentage of pre-pandemic levels, has been trending up through the fall, but has dropped off again since the move to close or restrict many activities.

The fall also shows up in average bus occupancy numbers.

When the TTC set its 2022 operating budget, the drops shown above were not yet reflected in the stats.

Their projection for 2022 ridership fell in a band based on the experience to date with system recovery, but this has now been modified. The TTC now aims to be back to the low end of its projected demand by Q3 2022. This will create a shortfall in revenue compared to budget of about $100 million.

The revised and original operating budget proposals are shown below.

The original version is in a somewhat different format from the TTC’s budget presentation at their Board.

The columns of interest are the “2022 Budget” in the revised version, and the “2022 Recommended Budget” in the original.

(In $millions)OriginalRevisedChange
Revenues922817-105
Gross Expenditures22342229-5
Net Expenditures13121412100
COVID Impact461561100
Total City Funding excluding COVID8518510

The additional $100 million has been added to the City’s list of items for which it seeks provincial and federal assistance.

Provincial Gas Tax

In normal years, the City divides the provincial gas tax share it receives from Ontario between the operating and capital budgets, with $90 million going to operating and the rest to capital. In 2020, because of the extraordinary strain on operating revenues, all of the provincial gas tax went to operations. The City plans to return to the standard practice of splitting this revenue between the two budgets in 2022.

The province recently announced that the total gas tax funding for municipal transit would be $375.6 million. Of this, $120.4 million is a “top up” to the share that would have flowed to municipalities under the usual formula of two cents/litre, but for reduced fuel consumption during the pandemic.

Toronto will receive $185.1 million.

Without the one-time top-up, this is a revenue stream that can fluctuate with the economy and with changes in the mix of fuel efficient and electric vehicles across the province.

Covid vs non-Covid Budgets

An intriguing issue in the City and TTC’s reported year-end projection is a conflict between the financial situation each of them reports:

  • The TTC will post an unexpected surplus of about $36 million (revenue including subsidies in excess of actual expenses). This will go into a City reserve fund for transit.
  • The City reports a shortfall of $75 million for transit-related Covid costs that has not yet been paid by either the provincial or federal government.

I asked the City to explain this, and they replied that, in effect, there are separate budget lines for “normal” operations and costs related to Covid.

The 2021 Operating Budget for the TTC was developed with $796 million in anticipated COVID-19 impacts.  COVID-19 related financial impacts across the City were identified and included in Agency and Divisional budgets, while COVID-19 support funding from the Government of Canada and Province of Ontario were consolidated between the various Safe Restart Agreement (SRA) streams and budgeted for corporately by the City.  While the TTC has experienced 2021 COVID-19 financial impacts in the form of lost revenue and added costs that has been consistent with the $796 million budgeted estimate, there is $75 million in outstanding funding support to address these COVID-19 transit impacts experienced in 2021, reflected as a revenue/COVID-19 funding shortfall in the City’s budget.

City and TTC staff continue to dialog with our Federal and Provincial counterparts and consistent with commitments in the provincial Fall Economic Statement, expect to receive full SRA funding support for 2021 COVID-19 financial impacts. 

Stephen Conforti, Executive Director, Financial Planning Division, City of Toronto by email, January 18, 2022

I asked for a clarification of this, and the City replied:

While there is only one budget for the TTC, COVID-19 support funding for Transit, Shelters, Public Health, Long-term Care, etc. was budgeted separately within the City’s corporate revenue budget.  As a result, the net budget for the TTC increased by $796 million in 2021 to account for COVID-19 impacts (lost revenues and added costs), with the offset in the form of expected COVID-19 support funding residing in the City’s corporate revenue budget.

Given that the COVID-19 funding shortfall of $75 million specific to transit costs resides in the City’s corporate revenue budget, the deficit created by this funding shortfall is reflected and reported in the City’s accounts and referenced in TTC variance reporting.

Stephen Conforti, Executive Director, Financial Planning Division, City of Toronto by email, January 21, 2022

What has happened, rather oddly, is that thanks to the downturn in service levels due to both the vaccination mandate and TTC’s service trimming, the TTC’s costs dropped, but ridership stayed strong almost to the end of the year. This predates the effect of the restrictions on ridership seen in the charts above.

The result was that the TTC will not need all of the subsidy draw originally budgeted, and the “surplus” will go into the transit reserve following City policy. Also, a planned draw on that reserve in the 2021 budget will not be needed. The final amount of that “surplus” will depend on the effects of ridership and revenue drops in late December 2021.

For 2022, a draw of $20.7 million is planned on the transit reserve.

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TTC Service Changes Effective February 13, 2022

In the February 2022 service changes, the TTC will begin to restore some of the pandemic-era service cuts. Many of the affected routes are comparatively short and operate on headways where the removal of one or two buses made a big change in the level of service. At the same time, running times on some routes will be adjusted for reliability including some cases where service is improved by reducing round times.

The total amount of service remains below the budgeted level by 1.8 per cent in light of reduced operator availability.

About 20 crews remain open at each division, and they would be staffed using spare operators or overtime.

Vehicle occupancy standards will be changing for the purpose of planning service levels. I will discuss the TTC’s plans for the timing of service improvements in a separate budget update article to be published soon.

The TTC will be modifying the vehicle occupancy standard in the February board period in preparation for projected increases in ridership in Q2 2022 (50% of pre-pandemic levels) and Q3 2022 (70% of pre-pandemic levels). The vehicle occupancy standard will be adjusted to 80% of pre-pandemic levels or approximately 40 customers per bus in the AM and PM peak periods (measured at the peak point, peak direction, peak hour for each period). In addition, to accommodate this increase in customer demand, service hours are also budgeted to increase in Q2 2022 to 100% of pre-pandemic levels.

Subway

There is only one change on the subway. The step-back crewing for One Person Train Operation (aka OPTO) on the Spadina Subway at St. George Station will be changed to a double step-back to give operators more time between trains and reduce delays.

Streetcar

The following changes will occur on streetcar routes:

  • 501 Queen:
    • Streetcar service is restored via Queen to Wolseley Loop at Bathurst Street. It will be further extended to Sunnyside Loop in May.
    • The travel times on the bus service between Broadview and Humber/Long Branch will be reduced. No buses will be removed from the schedule, and headways will improve.
  • 505 Dundas:
    • The temporary extension to Woodbine Loop has been removed.
    • Four AM bus trippers from Broadview Station that originate from 100 Flemingdon Park have been restored.
    • Service to Broadview Station will resume with the schedule change in late June. (Presumably this will also see 504 King return to Broadview Station as well, although it is not explicitly mentioned in the TTC’s service change memo.)
  • 506 Carlton:
    • Streetcar service is restored over the full route following sewer construction on Coxwell Avenue.
    • Four AM peak bus trippers from Main Station that originate on 23 Dawes, 24 Victoria Park and 67 Pharmacy have been restored.

The total number of buses operating on streetcar routes has been reduced:

  • AM peak: From 88 to 83 (net of 8 restored trippers on 505 and 506)
  • PM peak: From 81 to 66

The TOInview infrastructure project map now includes the reconstruction of streetcar track on Adelaide from Charlotte Street to Yonge Street as a 2022-23 project. This is part of the Ontario Line diversion, but it also will give eastbound service a bypass for events on King and Queen between Spadina and Church. The addition of a southbound track on York Street is not yet listed on TOInview.

Buses

The following routes will see changes, most of which are service restorations to fall 2021 levels.

  • 8 Broadview: Schedules changed for reliability. Late evening headway increases from 20 to 30 minutes on all days.
  • 9 Bellamy: Service improvement weekdays during the peaks, midday and early evening.
  • 11 Bayview: An AM peak tripper removed in error in December has been restored.
  • 12 Kingston Road: Service improvements during weekday peaks, Saturday morning, Sunday morning and afternoon.
  • 20 Cliffside: Service improvements during all periods except Monday to Saturday late evening, and Sunday evenings.
  • 22 Coxwell: Running times increased and service reduced during most periods.
  • 23 Dawes, 24 Victoria Park and 67 Pharmacy: Trippers interlined with 506 Carlton restored.
  • 25 Don Mills: AM peak trippers removed. School trips restored.
  • 42 Cummer: Peak period service improvement. 42C Victoria Park service restored.
  • 45 Kipling: Service rebalanced between Steeles and Belfield branches so that matching headways operate on each branch.
  • 50 Burnhamthorpe: Service improvements during all daytime periods and weekday early evenings.
  • 57 Midland: Service improvements weekdays all day except midday, Saturdays except late evening and Sunday daytime.
  • 61 Avenue Road North: Service improvements weekday peak periods and midday.
  • 76 Royal York South: School trips restored.
  • 78 St. Andrew’s: Service improvement during weekday peaks.
  • 100 Flemingdon Park: Four AM peak trippers interlined with 505 Dundas restored.
  • 161 Rogers Road: Service improved during all periods on weekdays, offset by service reductions in some periods on weekends.
  • 168 Symington: Service improved during all periods on weekdays, offset by service reductions in some periods on weekends.
  • 925 Don Mills Express: Weekend operation restored.
  • 600 Run as Directed: Weekday crews reduced. Weekend crews substantially increased. Although this is not explicitly mentioned, weekend subway shutdowns for maintenance and construction will resume in February.
  • 300 Bloor-Danforth Night Bus: Several trippers have been added, especially on Sundays, to deal with crowding on trips in the period before the subway opens.

Details of these changes are in the spreadsheet linked below.

2022.02.13_Service_Changes