[For those who are wondering where their comments are:  Several of these touch on the question of Transit City project costs.  I plan a separate post on that topic and am holding your comments until that is ready.

[The many comments about the future of the RT have been moved to their own thread.] 

On November 14, the TTC considered its 2008 Capital Budget.  Although there are major issues with funding of many projects, especially on a long term basis, the budget has been passed on to Council. 

One important approval, made with the concurrence of the City Budget Committee, is that work can begin on the three top-priority Environmental Assessments for Transit City:  Eglinton-Crosstown, Sheppard East and Finch West-Etobicoke.  This work will stop Queen’s Park does not make funding available as part of their budget announcement for the fiscal year starting in April 2008.

The Capital Budget presentation at the meeting is not available on the TTC site, nor are several tables and charts from the main report.

The 2008 Capital Budget Summary gives a broad overview of the five and ten year projections.  The 2008 Capital Infrastructure and 2008 Capital Vehicles tables give some break downs.

The same information is subdivided in a different ways:

• The 2008 Capital Base Program By Category shows that 81% of the capital budget is allocated to State of Good Repair. 
• The 2008 Capital Program By Major Cost table breaks down the same information from the summary into a pie chart.
• The 2008 Capital State Of Good Repair Summary shows the proportion of this category consumed by each major area.  Vehicles account for over half of this.

Growth and system renewal drive many aspects of the budget.

• Peak period riding increases the fleet and garage space requirements.
• The shift to low-floor buses reduces vehicle capacity and increases the size of the fleet needed to handle demand.  This changeover will be completed by 2010.
• Replacement and expansion of the streetcar fleet for the existing base system plus planned additions such as the Waterfront lines.
• Replacement and expansion of the SRT fleet both for capacity and for the proposed extension to Sheppard & Markham Road.
• Expansion of the subway fleet and partial replacement with new cars to increase capacity on the Yonge-University line.
• Transit City will add seven new LRT routes to the network.
• Subway expansion on both the Spadina/York and North Yonge lines.

The Base Budget of $4.4-billion for 2008-2012 (detailed in the links above) covers only State of Good Repair projects.  At present, there is a $0.7-billion funding shortfall for this work.  Later in this article, I will return to this issue. Continue reading →

The covering reports for the 2008 budgets are now available on the TTC’s website, although as usual there are severe formatting problems and the tables don’t display at all.  Once I have “real” reports, I will scan and publish the pictures here.

The TTC is supposed to be converting to PDF format.  Given that their IT Strategic Plan [sic] (also on the agenda for November 14) includes items that are six years old and counting, my guess is that we will see PDFs only after a multi-gazillion-dollar website redesign.

In the Operating Budget, we learn that the TTC is a bit shy of cash for next year, $13.6-million to be exact, to which must be added the cost of any contract settlement.  The annualized cost of a 1% increase in wages is about $8-million according to the report, although I have problems with this statement.  It implies that total wage costs for unionized staff are $800-million before any benefits are added, and before the cost of materials, fuel, power, fixed plant operations and, oh yes, those pesky non-union managerial staff.  I will return to this once I have a chance to review the detailed budget figures.

Ridership is growing, and is forecast to rise to 464-million next year.  However, we also learn than this year’s projected ridership, 454-million, is about 10-million high because the TTC overestimated Metropass usage.  Poof!  Ten million rides gone from the 2007 projection.  This may be the first time the TTC has lost rideship due to an accounting error.

An ironic side effect is, of course, that with fewer notional “riders”, the revenue per rider has gone up without the TTC lifting a finger (well maybe a few fingers to dip the quill pen into the inkpot).

Try telling people jammed onto the subway that there are really 10-million less of them.

The Ridership Growth Strategy kicks in next fall along with, if we are lucky, improvements to get service simply back to the TTC’s own standards early in 2008.  There has been no definitive announcement on the timing of this change, although February had been mentioned by some at TTC.

The story in the Capital Budget is much darker.  As I reported a few weeks ago, the TTC will scrape by in 2008 within the City’s budget target but future years are grim without major increases in subsidy from any government willing to lend a hand.  There is no funding in place for the proposed new streetcar order, and this needs to be sorted out by next spring if the procurement process is to continue on schedule.  This is only the first of several major unfunded projects.

(There is a followup report on the streetcar project listed on tomorrow’s Supplementary Agenda, but the report is not yet online.)

As the TTC rightly points out, we are in the “unusual” (their term) or “ludicrous” (my term) position of having a $1.5-billion shortfall in the base capital budget while, simultaneously, the Spadina/York Subway extension us fully funded.  If anyone says “the cupboard is bare”, we know where to look.  Anyone who feigns surprise that this extension has elbowed other projects off of the table deserves a dunce’s cap (in TTC colours of course).

Meanwhile, both the new streetcar procurement and Transit City are getting more expensive as cost estimates are refined.  This is not making friends among Councillors who want so badly to be pro-transit, but who are sideswiped by the TTC’s inability to price their projects.

Finally, there is a long report about Transit City laying out the rationale for the choice of lines and in particular the selection of Sheppard East, Etobicoke-Finch and Eglinton-Crosstown as the candidates for the first three Environmental Assessments.  There isn’t much here that we haven’t seen before, and some of the discussions about how to fit new LRT lines onto streets echo the comments in earlier posts on this site.  Transit City was designed to fit with known planning goals and to serve those communities with reasonable expectation of demand.  This is, of course, totally contrary to good transit system design where lobbying and political favouritism win out over, dare I say it, common sense.

Update November 2:   The Analyst Notes for many areas of the Capital Budget are available online on the City’s website.  Notable by its absence is anything about the TTC, the single largest component of the entire budget.

On Monday, October 29, the City Budget Committee had its first public look at the 2008 Capital Budget.  This covers all of the programs funded by the City, of which the single largest part is the TTC Capital Budget.

We won’t know the details of what the TTC is planning for a few weeks until the Commission meeting on November 14, but we can see some outlines in the preliminary material from the City.

Toronto has a huge problem financing the TTC, and as things stand, of the $1.249-billion in new capital debt the City will raise from 2008-2012, about 80% is due to the TTC.

For 2008, the TTC’s capital funding request is in line with the City’s target, but as in past years, this is achieved partly by deferal of spending to the out-years.  This is not sustainable, particularly with major capital projects coming down the pipeline.  In the current estimates, the TTC’s capital requirement for 2009-2012 is about $420-million greater than the City’s budgetary target.

In addition to this shortfall, the TTC has an accumulated and growing backlog of capital projects that will grow to $363-million by 2012.

The table on page 18 of the Budget Presentation shows the anticipated funding sources from Queen’s Park and Ottawa.  An important line in the Provincial section is called “Long Term Funding Requirement” — this doesn’t correspond to any announced program, but it grows especially in 2012.  If you omit this line, the level of committed Provincial funding declines substantially.  The Federal section contains a similar problem with assumptions about growth in future funding.  (The problems and assumptions are restated in text format on page 19.)

The usual problem is that funding schemes at both levels are typically announced for a four or five year window, just long enough to get past the next election, but they are not entrenched.  We have to hope that something will replace them, but if nothing comes along, we are left holding the bag for future spending.

A separate Highlights Report shows major transit projects on pages 10-11.  Note that the dollar values for these projects only cover the 2008 year, not the full cost to completion.  For example, the new streetcar project will only consume an estimated $55-million next year.  Those who are following the reconstruction of the streetcar track will note that many of the listed projects are on the “non-revenue” trackage (Dufferin, Church, Richmond, McCaul, Parliament and Wellington).  The other major projects, of course, will be completion of the St. Clair line and the remaining work on Bathurst.  By late 2009, we will finally be at the end of the heroic project to bring the TTC’s streetcar network back into good condition everywhere.

One troubling aspect of the TTC’s funding needs is “scope creep” and the arrival of previously unbudgeted projects in the five year plan.  The 2008-2012 budget exceeds the City’s affordable debt target by $420-million as I mentioned earlier, but this is up considerably from the $197-million shown in last year’s budget.

We don’t yet know which projects contribute to this, and there’s probably even worse lurking in the next five year period from 2013-2017 when many large projects will be in full swing.

One obvious issue is the Yonge subway resignalling project, the move to automatic train control and service increases to build capacity on the line.  The subway car order with Bombardier signed earlier this year does not come close to providing enough cars for the entire YUS line, even without the York extension, nor for any improvement in service frequency.  If the TTC hopes to reap the benefit of the new fleet, then they will have to add a follow-on order for more “Toronto Rockets”.  The additional cars would replace the remaining “H” series fleets used on the Yonge line, and the T-1’s would all move over to Bloor-Danforth.

For the new streetcar fleet, we still do not know the price per car, and each estimate is higher than the last.  Moreover, we don’t know whether wishful thinking on specifications will run headlong into technical reality regarding both the track geometry and the overhead power system.  Any retrofits will add to the overall cost of rolling out the new cars.

For the bus fleet, current plans call for only modest growth, and even Mayor Miller’s long-promised 100 extra buses will be partly eaten up by added ridership before they actually hit the streets, now likely in fall 2008, a year later than planned.

The TTC has a long history of springing new projects and large-scale changes to existing ones because, somehow, the capital is always found to deal with these problems.  Once we see the details in the budget papers, I will likely have more to say on this subject.

The recent federal budget announcement shows quite clearly that Toronto cannot expect relief of its funding problems from Ottawa, and it’s time that both the City and Queen’s Park stopped waiting for that solution.  Yes, one or both levels will have to generate new revenue to invest in the transit system, and readers here know that my preference already lies with Queen’s Park. 

Toronto’s transit system is a regional resource and it should receive solid, sustained funding from the Province.