The Ottawa LRT Report Part II

This is a continuation of my review of the Final Report of the Commission of Inquiry into the Ottawa LRT fiasco. This article picks up from the point where the contract is awarded to the successful P3 bidder, Rideau Transit Group, and reviews the contract and project structure.

See also: The Ottawa LRT Report Part I which contains introductory material and the story up to the contract award. In Part III I will turn to construction problems and testing before revenue service began, and Part IV will cover from that point to the present.

Contractual Agreement

On December 19, 2012, Rideau Transit Group (RTG) achieved the best score on their submission although, as I noted in the previous article, this was primarily on financial factors as the technical scores of the three bids were close to each other. Ottawa still clung to the 2010 budget estimate, and the project was approved at $2.13 billion. However, the P3 arrangement removed much of the City’s control over the project.

The actual structure of the project involved several entities, some of which were actually the same companies acting in different guises. This divided the project into subcontracts although ultimate responsibility rested at the top with RTG.

The Project Agreement accounted for the fact that, as is typical with this type of model, RTG would flow the bulk of its contractual obligations under the agreement down to subcontractors. […] The Project Agreement required RTG to ensure that its subcontractors complete the subcontracted scope of the OLRT1 project in the same manner and to the same extent as RTG is required to under the terms of the
Project Agreement.

Accordingly, the obligations for the works required by the Project Agreement were set out in RTG’s subcontracts with OLRT-C [the construction arm of the P3] and RTM [the mainenance arm], respectively. Under the subcontract with OLRT-C, OLRT-C took on the obligation to complete the design and construction as required under the Project Agreement as well as the risk and associated payments if the obligations were not met. Similarly, the subcontract with RTM flowed down RTG’s obligations to maintain the OLRT1 project as required under the Project Agreement, and RTM took on the risk and associated payments if the obligations were not met.

This structure allows RTG to be a small entity made up of only a handful of executives and support staff who would administer and oversee its contracts with its subcontractors. Any reporting from the subcontractors up to the City and back went through RTG. [p 148]

In this arrangement, management of the groups responsible for the work flows through the topmost level, RTG. In theory, this provides a single point of contact and responsibility, but it also creates a potential choke point in the City’s ability to manage work done on its behalf.

“Under the Project Agreement, RTG was responsible for the construction and maintenance of the OLRT, and the City would be the operator of the system. The Project Agreement, which was based on Infrastructure Ontario’s P3 template, gave the City limited control over the construction process or the subsequent maintenance of the system. Therefore, the City’s ability to direct the project was generally limited to enforcing specific financial remedies under the Project Agreement. In essence, the City was in a position where it had to rely on RTG to fulfill its contractual obligations and could only attempt to ensure compliance by withholding funds or otherwise enforcing contractual remedies.” [p 9]

Systems integration is an important part of any large technical project. One cannot simply buy components from various sources, plug them all in and expect them to work. With the management of suppliers happening a few levels removed from the City, an assumption is needed that this integration is actually happening. In fact, it was not, or at least not at a level needed to guarantee success.

“RTG’s project plan required the various engineering systems that went into the OLRT1 to be carefully integrated. However, the subcontractors operated in silos. These decentralized arrangements made it essential that the parties integrate their efforts and engage in near-constant communication. They failed to do so, OLRT-C [the construction arm of the P3] did not effectively coordinate their efforts, and the project suffered due to this lack of coordination.” [p 9]

On top of these issues, the vendors argued that the specifications were too “prescriptive” about how things should be achieved, as opposed to describing a system performance requirement and leaving it to the P3 to figure out how that should be met. This affected, in particular, the vehicle design.

An obvious question is why this was not addressed during the pre-award stage of commercially confidential discussions, or if the City and their consultants (who presumably were responsible for the specification) refused to change it.

“Regardless of the details of the project specifications required in the Project Agreement, by signing the Project Agreement, RTG agreed to be “responsible for the complete design, Construction, testing and commissioning and Maintenance of the complete Systems required for the safe and efficient operation of the LRT.” That is, RTG signed the Project Agreement with “eyes wide open.” [p 151]”

The contract contained provisions for various types of default including:

  • Failure to Maintain Schedule: The City could issue a notice to RTG which triggered a requirement for a plan to get the project back on time and achieve a Revenue Service Availability (RSA) date no later than mid-May 2019. Failure to deliver a plan would be deemed a default and entitle the City to terminate the contract.
  • Delays to Revenue Service Availability: Many preconditions determined whether RSA had been achieved including Substantial Completion of civil works, testing and safety requirements, and training of City staff for system operation. The RSA date was May 24, 2018, and five days after certification, RTG was entitled to a $200 million payment. If this date was not met, the agreement included provisions for rescheduling and a penalty payment (liquidated damages), but in any event if the date went beyond May 2019, this would be considered as a default.
  • The contract between RTG and OLRT-C also contained provisions for penalties up to about $145 million for delay damages.

Various types of events were provided for where RTG would be entitled to a schedule change and financial compensation. Typically these were external events including Acts of God, interference by other agencies or governments, labour actions, civil unrest, contamination of work sites, and archeological finds. Even if the event was beyond RTG’s control, they were required to reduce or eliminate its impact to the degree possible.

Despite this fairly exhaustive list, the agreement did not provide for any relief related to geotechnical risk. This was assumed completely by RTG with only the following exemption:

“The only partial exception to this is that the Project Agreement did create a Relief Event “with respect to Tunnel Work only” for “bursting or overflowing of water tanks, apparatus or pipes if such events are not attributable to the actions or omissions of Project Co [RTG] or any Project Co Parties and are not properly inferable, readily apparent or readily discoverable from the Background Information.” [p 159]

RTG, in effect, lost their bet on geotechnical risk thanks to a large sinkhole on Rideau Street. This event is covered later in the report.

Although the contract included a worst-case option that the P3 would be declared in default and the entire project would revert back to the City, this is obviously not a path to be followed except in the most dire circumstances. There is a strong incentive for the P3 to hit the mark on schedules, or at least claim that this will occur, and for the City to use financial threats to ensure projects stay on time. However, this creates an antagonistic relationship if anything goes substantially wrong on the project.

However, with the Mayor’s political credibility hanging on delivering a project “on time, on budget”, the likelihood that the P3 would be forced into default was minuscule. This created a situation where the project would “succeed” no matter what.

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TTC Service Changes: Holiday Period 2022/23

As is usually the case, the TTC will implement modified schedules during the two-week holiday period which, because of the lie of the calendar, runs from December 25 to January 6 this year.

Several routes will revert to June 2022 summer schedules for the weekdays within this period. No changes are planned for Saturday and Sunday schedules. Many of the summer schedules have the same service frequency, but with fewer buses and shorter travel times reflecting reduced passenger and road traffic.

No school trippers are operated during the holiday period, and service is reduced on some routes serving post secondary campuses.

Late night New Year’s Eve service will operate until about 3am on most routes including all rapid transit lines.

Service will operate free of charge from 7pm on December 31 to 8am on January 1.

Details are in the spreadsheet linked below.

TTC Track Construction Update December 5, 2022

Here is a brief update on various construction projects in progress.

King/Queen/Queensway/Roncesvalles

Excavation continues on Roncesvalles at the north gate of the carhouse while the track panels for the new junction remain on trailers on King Street (see previous update).

Track installation has started south from Harvard Street toward the north gate.

The TTC has not yet announced a date for resumption of through service on Roncesvalles between Howard Park and The Queensway on route 504 King, nor for through streetcar service from downtown to Dundas West Station.

On The Queensway, the eastbound stop at Glendale has finally been taken out of service. Passengers are now directed to use westbound buses to access St. Joseph’s Hospital transferring at Roncesvalles or at Colborne Lodge Drive as appropriate.

The map below was tweeted by @ttchelps. As I write this, neither this map nor the diversion notice for the 504 bus service are linked to the route’s schedule page.

Construction continues on the new eastbound curb lane and the eastbound streetcar stop at Glendale. Work is also in progress on the track between Glendale and Parkside.

Overhead is still not in place at Sunnyside Loop although many span wires and hangers have appeared. The 501 Queen service cannot be extended from Dufferin to Sunnyside until this loop is available.

King & Shaw

According to a City of Toronto construction notice, this intersection will reopen on Friday, December 16. This would allow the 504 King and 63 Ossington services to resume normal operations here.

When the TTC announced their November service changes, this included a temporary option, once King & Shaw reopened, with half of the 504 service turning back at Exhibition Loop (the 504B Broadview cars) and half running through to Dufferin (the 504A Distillery cars). The 504C buses which loop at York Street would shift to a Bathurst turnback.

The TTC has not yet confirmed whether these arrangements will actually happen.

Adelaide Street

Construction has moved swiftly west on Adelaide and is now in the final stretch between Widmer and Charlotte Streets. The section east from York to Victoria will be rebuilt in 2023.

Wellington Street

New overhead has not yet been installed on Wellington Street. The 503 Kingston Road bus is looping via York, Richmond and University from King. Streetcar service should return in the Spring when pantograph-friendly overhead on the downtown loop and on Kingston Road has been installed.

Dundas at Brock Street

A large sinkhole appeared under the streetcar tracks on Dundas at Brock due to a burst 120-year old sewer. The City expects the street to be restored by the end of December, but the TTC will then have to restore the track and overhead. Until that work is finished, tentatively by the end of January 2023, the 505 Dundas service is diverting both ways east of Lansdowne via College and Ossington.

Media coverage is available from CBC and CITY, among other sources.

College Street

The diversion of 506 Carlton streetcars around the College Street reconstruction project is expected to finish by the end of 2022. Streetcars continue to operate both ways via Bay, Dundas and Ossington.

The Ottawa LRT Report Part I

The Ottawa LRT project opened for service in September 2019. It was riddled with problems years before through the procurement, construction and commissioning. After several failures, including two derailments, the Ontario government created a Commission of Inquiry under the Honourable Justice William Hourigan to investigate how this came to be.

This article is not an exhaustive review of the findings. Interested readers can browse the full report on the inquiry’s website. The Executive Summary gives a good overview, but many of the details are in the full report which is organized into “deep dives” into various aspects of the project’s history.

There are many lessons to be learned for other agencies and projects, and there is no reason to believe that the issues are unique to Ottawa’s first LRT line.

Where I quote directly from the report, this is shown clearly in quoted blocks. I have used the Executive Summary as a starting point, but have also woven in material from the detailed chapters to give additional background. Any conclusions or interpretations are my own.

This article reviews the report up to the point where the contract is awarded to a P3, Rideau Transit Group, to build and maintain the system. Part II will pick up the story from that point onward.

I have included part of the “Conclusions” section here for the benefit of readers who do not want to read through the full articles, much less the report.

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Tracking Metrolinx Project Costs

The Province of Ontario is not exactly transparent when it comes to reconciliation of announced project costs and actual spending, let along the changes that might occur along the way. A project, or group of projects, might be announced with a value in then-current dollars, and without necessarily including all future contract costs. There are various reasons behind this approach including:

  • The government does not want to tip its hand on the amount of money “on the table” to prospective bidders who might tailor their bid to the perceived level of funding.
  • Some contracts include future operating and maintenance costs as well as capital costs. In some case the announced cost does not include the O&M component, only the estimated capital portion.
  • Provincial projects are typically quoted in then-current dollars with future inflation to be added as it occurs, at least to the point where there is a contract in place which includes that provision.

This approach hides the likely as-spent costs and makes provincially run projects appear cheaper, at least in the short run.

This is fundamentally different from the way the City of Toronto tracks projects and how TTC requirements are reported. Specifically:

  • City project cost estimates include inflation to completion because this is factored into future funding requirements.
  • City projects do not bundle future operating costs with capital, but report them separately.

Note that cost estimates shown in the Infrastructure Ontario market reports do not necessarily match values shown by Metrolinx because IO shows these values on a different basis. Future operating and financing costs are no longer included in IO estimates so that a project’s value reflects only design and construction costs, a value that gives potential construction bidders a general size of the project’s scope.

Infrastructure Ontario notes on the November 2022 Market Update that we have modified the methodology used to calculate the estimated costs as presented on the chart. In May 2022, and for Market Updates prior to that, we used the Estimated Total Capital Costs. For the latest update, and going forward, the costs listed only include Design and Construction costs.

These changes were adopted after feedback from our construction industry partners found that including only design and construction costs provided them with a better sense of the scope of the project and would assist in determining if they wished to participate in the bidding process.

Email from Ian McConachie, Infrastructure Ontario, Manager, Media Relations & Communications, November 24, 2022.

This can be confusing with “bundled” projects such as the Ontario Line RSSOM contract which includes both provision/construction of vehicles and infrastructure, as well as future O&M costs. This is probably the reason, or a good chunk of it, for the very large increase in the RSSOM contract value between the initial estimate cited by IO and the contract award. However, the way these contracts are handled generally makes it impossible to know how much of the change is simply due to inflation in materials and labour costs, and how much is due to underestimates or scope changes.

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King-Queen-Queensway-Roncesvalles Update: November 26, 2022

The KQQR project is heading into the home stretch with work now underway on the North Gate to Roncesvalles Carhouse, and roadway construction and paving on The Queensway west to Parkside Drive. Alas, there is no announced completion date.

At the North Gate, recently completed utility work allows the area to be excavated in preparation for the new special work. This track has not yet been rebuilt to current standards (a program that will take years to complete as the cycle time is 20-30 years) with a concrete foundation, pre-welded track mounted on panels, and a top layer of concrete that can be removed for repairs without disturbing the two layers below.

The new track panels are sitting on trailers on King Street east of Roncesvalles awaiting installation.

Meanwhile there is some preliminary work on new overhead leading north into this area, but the main installation cannot occur until the new track is in place and overhead trucks can drive under the new wire.

On The Queensway itself, overhead has begun to take shape at Sunnyside Loop, but it is still not operational. This leaves the 501 Queen service turning back at Dufferin Street.

On King Street east from The Queensway, conversion of overhead suspension to pantograph compliance has finally started. This area and Kingston Road are the last two major areas to be converted.

Along the south side of The Queensway, much of the new curb is now in place and concrete for the new curb lane will likely appear soon, weather permitting. At Glendale eastbound (St. Joseph’s Hospital) the bus stop is even more rudimentary than on previous visits. Passengers wait in the temporary crossing area (which is now at least concrete rather than a wooden bridge), and then move across the traffic lane to board a bus when it arrives.

Between Claude and Parkside (the easternmost part of the existing streetcar right-of-way) excavation is in progress to remove old track and wooden ties in anticipation of completing the new trackwork between Glendale and Parkside.

So You Want To Be A TTC Commissioner (2023 Edition)

Our brand new City Council meets this week. After the requisite speechifying and back-patting typical of the inaugural gathering, they will get into the business of appointing members of various Committees and Boards, including the one that runs the Toronto Transit Commission.

There are two sets of Board members: Councillors and citizens, a.k.a. civilians who (in theory) are not politicians. Only the first group will be appointed at this meeting, and the citizen members will come up for review in the new year once the City goes through the motions of soliciting applications.

The choice of a TTC Chair is up to Council, although it’s hard to believe that a nod from the Mayor, even without any new powers, would be ignored.

On the past Board, the Council members were: Jaye Robinson (chair), Brad Bradford, Shelley Carroll, Cynthia Lai, Jennifer McKelvie and Denzil Minnan-Wong. Of these, Councillor Lai died just before the election, and Minnan-Wong chose not to run. The Chair’s job should go to someone with experience and a strong commitment both to transit and to making something of the position, not just being a seat warmer.

Oddly enough, none of the existing Councillor/Commissioners has asked to be reappointed. This could lead to turnover (good, maybe) but also the loss of institutional memory at the Board level. That works to management’s advantage, but an organization as large as the TTC needs experience at the top for policy and oversight, not just ribbon cutting.

The new Board, to be confirmed by Council today, will have Councillor Burnside as Chair, with Councillors Mantas, Holyday, Moise and Ainslie as members. The citizen positions will be filled separately in the new year, and current members remain in office until that occurs. I cannot say that I am enthusiastic abouy Burnside as Chair, and do not expect much advocacy from that quarter beyond a knife aimed at the budget, and hence the quality of transit service.

The new Board will face very, very serious problems affecting transit’s future in Toronto. As pandemic-era financial supports wind down, the TTC will simply not be able to afford to operate service without new revenues through fares or subsidies. Moreover, their capital plans vastly exceed available resources.

Since 2020, the struggle has been to just get past the crisis, but the TTC faced a bleak outlook even before the pandemic. I have no crystal ball or magical insights, but offer this article as advice to the new Board.

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Infrastructure Ontario Procurement Update: November 2022

Infrastructure Ontario has issued an update on its various projects in procurement. I have been tracking the transit projects for some time, and the table linked below shows how they have evolved.

My last article on the subject was for the January 2022 update, but I skipped May because so little had changed. This article (and the table) reflect changes in the May and November bulletins.

Updated Nov 22/22 at 7:20 pm: The status tracking table has been updated to correct the date for the Ontario Line Pape Tunnel project.

IO Status Tracking November 2022

Some of the changes in this update are quite substantial.

Ontario Line

The North Civil, Stations and Tunnel contract previously included both the tunnel segment from Gerrard north to the Don River, the bridge over the river, and the elevated structure north to Eglinton. This has now been split into two separate contracts.

  • Elevated Guideway and Stations
  • Pape Tunnel and Underground Stations

Each of these projects is shown with an estimated cost of $1-2 billion, compared to $3 billion for the combined version.

In May 2022, the North Civil contract execution date was July-Sept 2024.

The Elevated Guideway and Stations contract is now shown in two stages with the Development Phase Agreement (DPA) in Jan-Mar 2024 and the Project Agreement (PA) in Jan-March 2025.

The Pape Tunnel and Underground Stations contract is now shown with a DPA of Jan-Mar 2024 and a PA in July-Sept 2026. [Corrected]

There is no indication of the effect these changes will have on the opening date.

The Rolling Stock, System Operations and Maintenance (RSSOM) contract was awarded in November 2022. In previous updates it was estimated at “>$2B” (greater than $2 billion), but was awarded at a value of $9 billion.

The South Civil, Stations and Tunnel contract was also awarded in November 2022, In previous updates it was estimated at “>$4B”, but was awarded at a value of $6 billion.

Line 2 (Scarborough) Subway Extension

The Stations, Railway and Systems contract project agreement (PA) date was previously cited as Jan-Mar 2024, but this has been changed to July-Sept 2024.

The tunnel contract was awarded in May 2021 and is already underway.

Line 1 (Yonge North) Subway Extension

The tunnel contract Request for Qualifications issue date has slipped from Jan-Mar 2022 in the January 2022 update to Jan-Mar 2023 in the November update. For some reason, the estimated cost has gone down from $2-4 billion to $1-2 billion. I have asked Infrastructure Ontario to clarify this.

The Request for Proposal issue date was supposed to be Jul-Sept 2022, but is now Apr-June 2023.

Contract execution has slipped from July-Sept 2023 to Apr-June 2024. It is not clear what effect this will have on the planned opening date.

Eglinton-Crosstown West Extension

This project has four components:

  • The tunnel contract for the segment from Renforth to Scarlett was awarded in May 2021.
  • The tunnel contract for the segment from Jane to Mount Dennis closed its RFP process in November 2022. Award is expected in Jan-Mar 2023.
  • The elevated structure between the two tunnels is in a separate contract now at the RFQ stage.
  • The Stations, Railway and System contract has not been issued yet.

Lines In Planning

Three lines are in the planning stage only with one added in the May 2022 update:

  • Line 4 (Sheppard East) Subway Extension
  • Hamilton LRT
  • Eglinton West Crosstown Airport Segment (new in May 2022)

GO Expansion

All of the contracts for the expansion program have now been awarded, and they will not appear in the IO updates.

What Should Be Done With Spadina and St. Clair?

This article was originally going to be a very long reply to a comment left in the Spadina vs Bathurst thread, but I have moved it to its own article for better exposure.

I received the following comment from someone whose identity I will keep to myself. You know who you are.

Steve, I am a political strategist at the municipal level here in Toronto. I have a meeting with some new inner city Councillors next week (+ the Mayor) who are interested in this issue of streetcar speed and reliability (as am I as a fervent reader of your blog!).

Putting aside cost and political barriers for the moment: from a purely technical perspective, what measures would you recommend implementing on the Spadina and St. Clair streetcar routes to speed them up without losing ridership?

For instance:

  • Are there any stops on the Spadina line, near or far side, that could be eliminated while still retaining the riders who use those stops via other stops?
  • What kind of TSP [Transit Signal Priority] extension would yield the best results if having to choose between the two: extending the seconds of green light extension OR maintaining the green light extension window while simultaneously allowing for more active TSP (ie rather than just if it’s late)?
  • How much time would be saved if all far side stops were eliminated on Spadina and St Clair?
  • How much delay does the lack of grade separation for the final/first leg of the St Clair route (ie when it’s entering or leaving the station and having to wait for cars and pedestrians) cause? Would installing a signal system for that unprotected stretch that prioritizes the streetcar result in any substantial gains?

Open to all thoughts and suggestions – many thanks 🙂

I am replying to this in public because (a) the comment was left in the public thread rather than sent in a private email, and (b) my answers will be of interest to other readers.

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Metrolinx Vandals And Osgoode Hall (Updated)

Updated November 21, 2022 at 10:45 am: The Sir William Campbell Foundation has written to Metrolinx challenging their plans for Osgoode Hall’s garden and noting specifically their previous commitments to await a City-commissioned study.

Earlier this year, after considerable debate about the future of the trees in the park at Osgoode Hall, Metrolinx agreed to the City undertaking a study of alternative designs for the new Ontario Line station there. No action would be taken until a consultant’s report, commissioned by the City, was delivered and presented to Council.

The report is supposed to be completed in 2022 and reported to Council in the first quarter of 2023.

Now, Metrolinx has advised the Law Society of Ontario that tree clearing will begin on December 5, 2022. This is in direct contravention of the agreement Metrolinx made with the City, the Law Society and other community groups.

It is no secret among any groups and politicians, with the possible exception of the Premier, that Metrolinx’ word cannot be trusted on any “promises” or “commitments”. This outcome does not surprise me one bit based on their past behaviour. Why should anyone participate in their public participation shams?

There is no word from our all-powerful Mayor who made threatening noises – back when he was trying to get re-elected – about protecting Osgoode Hall. How long has he known that this would be the outcome, that Metrolinx would forge ahead with their plans on their schedule, and the City’s position be damned?

It is entirely possible that Metrolinx knows what the consultant report says based on discussions they have already had. If so, and if the consultant’s position was “gee whiz guys, I really would like to save your trees, but …”, then simple decency demands that the report be released and the options debated before Metrolinx launches into their tree clearing. But that’s not how Metrolinx works. Bull ahead, make an irreversible move and to hell with the consequences.

My opinion of Metrolinx is no secret, even though I keep trying to find touches of good will, of professional quality among the dross and endless feel-good PR they churn out. Sadly, Metrolinx never surprises, never actually listens and consults, beyond asking what colour of toilet paper we want to clean up their inevitable mess.

The timing of the announcement, right as the new City Council is getting established and distracted by its own problems, is typical. Catch the opponents when they have other things on their plate.

This is a disgrace for Metrolinx, and a disgrace for Mayor Tory who can huff and puff for the cameras, but when it counts turns out to be Doug Ford’s puppet.