Finance

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Scarborough Subway Ridership and Development Charges

The Star’s Jennifer Pagliaro reports that City Council has approved a confidential settlement with BILD, the Building Industry and Land Development Association, to avoid an Ontario Municipal Board hearing that could lead to rejection of the Bylaw implementing the Development Charges intended to pay for the Scarborough Subway. The matter was before Council in confidential session on June 7, 2016.

Staff miscalculations on the ridership of the Scarborough subway will leave taxpayers on the hook for millions more, after city council voted to settle a dispute with developers.

According to a secret report before council on Tuesday, the contents of which were shared with the Star, the city’s lawyers advised councillors to accept a settlement with the group representing developers, the Building Industry and Land Development Association (BILD).

The settlement, which reduces the amount builders will have to pony up to help finance the subway, is expected to cost the city as much as $6 million in lost revenues.

If the settlement is for only $6 million, the City should consider itself lucky because the calculation underlying the DCs is based on flawed ridership estimates and an out of date network design. Moreover, the original authorization appears to double count subway revenue with both a special Scarborough Subway Tax and Development Charges to recover the same costs.

Recent news of a 50% reduction in expected Scarborough Subway ridership from 14,100 to 7,300 passengers in the AM peak hour reignited political debate on the viability of the subway scheme. However, these numbers are not just hypothetical indicators of how the line might perform, they are integral to the calculation of Development Charges (DCs) that would help to fund the City’s share of this project.

See also my previous articles:

The formula to calculate development charges is complex, but at its heart is one key measure: how much of a new transit project will benefit existing properties versus future development. If the primary role of a new subway is to improve the lot of current riders, then only a minority of its cost can be recouped by DCs (and thus from future purchasers of new properties).

Toronto allocates DCs on a city-wide basis rather than assigning each project only to the neighbourhoods it will directly serve. These charges already help pay for many projects as shown in the introduction to the study establishing the level of new charges for the SSE.

The Council of the City of Toronto passed a Development Charges (DC) By-law, By-law 1347-2013 in October 2013, for the recovery of capital costs associated with meeting the increased needs arising from development. The effective date of the Bylaw was November 1, 2013. The recovery of DCs is on a City-wide basis and relates to a wide range of eligible City services:

  • Spadina Subway Extension
  • Transit
  • Roads and Related
  • Water
  • Sanitary Sewer
  • Storm Water Management
  • Parks and Recreation
  • Library
  • Subsidized Housing
  • Police
  • Fire
  • Emergency Medical Services
  • Development-Related Studies
  • Civic Improvements
  • Child Care
  • Health
  • Pedestrian Infrastructure

For commercial property, there is some justification to this because increased mobility makes travel to jobs simpler well beyond the location of any one project. For example, the Scarborough Subway might be held out as a way to stimulate growth at the Town Centre, but it would also reduce commute times to other parts of Toronto, notably downtown.

For residential property, especially for the large proportion of new development downtown, this link is less clear, and DCs on new condos can wind up funding transit projects of little benefit to the new residents.

This split is part of the eternal battle between sharing the cost of public services across the city and charging them locally or by user group.

In the case of the Scarborough Subway Extension (SSE), the split between new and existing beneficiaries was determined by the change in ridership projected with the subway project. The benefit was allocated 61% to new development and 39% to existing riders. The ratio is high because, at the time of the calculation, the projected peak hour ridership for the SSE was estimated at 14,100 compared with a base value of 5,500. Both of these numbers are suspect.

The base value was factored up from actual SRT ridership of 4,000 per hour to 5,500 to represent the load the subway would have had were it to exist in 2015. That value of 4,000 is equivalent to a load of about 240 per train when the peak service was 17.14 trains/hour (3’30” headway) as in 2012. However, by 2013 service had been cut to 13.33 trains/hour (4’30” headway) to reduce equipment requirements on the aging line. That is the service operating today, although a further cut to 12 trains/hour (5’00” headway) is planned for June 20, 2016. Some of the demand that would be on the SRT travels via alternate routes, some is packed into fewer trains, and some has probably been lost to the TTC. What the ridership might be today were the RT not capacity constrained is hard to tell, but it should certainly be higher.

The high value for future subway ridership combines with the low value for presumed current demand to load much of the SSE’s cost onto new development.

The situation is complicated by two competing ridership estimates:

The contexts for the three estimates differ, and this goes some way to explaining why the numbers are so far apart:

  • A line to Sheppard will attract more ridership than one ending at the STC.
  • A subway station at Sheppard, in the absence of improvements to the GO corridor such as RER and SmartTrack, will attract ridership from Markham just as Finch Station does from the Yonge corridor north of Steeles.
  • Removal of the station at Lawrence East, coupled with new GO corridor services, will reduce demand on the subway.

There is no guarantee that the land use, job and population assumptions underlying the three estimates are the same, especially when the highest number was produced in the context of boosting the importance of STC as a growth centre.

What we are left with, however, is the likelihood that the level of DCs allocated for the Scarborough Subway project were based on the most optimistic scenario for new ridership, and a network configuration quite different from what will actually be built. If the calculation had been done on the basis of lower ridership numbers, the DC revenue available to fund the Scarborough Subway would have been considerably lower.

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A Boost for the Relief Line

This afternoon, June 1, there was a small miracle at the TTC’s Greenwood Yard. Assorted politicians and transit management gathered for an announcement of transit funding, of new transit funding, and for that perpetual orphan of Toronto’s political scene, the (Downtown) Relief Line.

Steven Del Duca, Ontario’s Minister of Transportation, announced that Metrolinx would be given “more than $150 million” to work with the City and the TTC on advancing planning and design for the Relief Subway Line to bring it to “shovel ready” status.

This is a substantial commitment of financial support, but more importantly of political support. Del Duca was joined by Mayor John Tory in singing the Relief Line’s praises as a necessary part of growing capacity on the transit network building out from earlier improvements through GO/RER and SmartTrack.

According to Chief Planner Jennifer Keesmaat (whose Twitter session is in progress as I write this), study of the RL will focus initially on Phase 1 (Danforth to downtown), but will then shift to the northern and western extensions. The northern extension is of particular importance because, according to Metrolinx demand projections, it will have a major effect in offloading demand from the Yonge Subway and the Bloor-Yonge interchange.

RLUpdateProjectedDemand_P31

[Source: Metrolinx Yonge Relief Network Study p. 31]

With both the Mayor and Queen’s Park supporting the RL, and with provincial funding of the design work, the Toronto City Council gridlock over transit priorities can be “relieved” for at least a few years. The RL will not have to compete with other schemes for City funding, and with Metrolinx holding the purse, Council will not be able to divert the money to pet “relief” lines for suburban Councillors. Indeed, the whole suburbs-vs-downtown argument, which is born in part by a desire to be at the front of the line, need not pollute the RL study.

The Metrolinx role is also important because the RL (aka the “Don Mills Subway” to many on this site) needs time to be presented for what it can do for suburban Toronto were it to run north at least to Sheppard & Don Mills via Thorncliffe Park. Many riders would have a completely new route to downtown comparable to the service now provided by the Spadina Subway, and this would be completely separate from the existing congested system. Capacity released on the Yonge line would be available to riders from the proposed Richmond Hill subway extension, and the reduction of transfer traffic at Bloor-Yonge could eliminate the need for an extremely expensive and complicated expansion of platform and circulation capacity there offsetting some of the Relief Line’s cost.

Del Duca acknowledged the considerable work already done by the City and TTC on this file. Indeed, had it not been for the TTC’s Andy Byford with support from City Planning raising the alarm about the need for a Relief Line, nothing would have happened.

Some comparatively short term improvements will provide “relief” on the Yonge line, but these will be backfilled by pent up demand over the next decade.

RLUpdateCapacityChart_P20

[Source: Metrolinx Yonge Relief Network Study p. 20]

Smart Track may shave another small amount off of this, but notwithstanding the Mayor’s enthusiasm, the City’s own demand projections published as part of the Scarborough studies show that SmartTrack has a very small effect at Bloor-Yonge.

Tory is still somewhat confused about just what Smart Track’s effect will be considering how much it has been scaled back since his election campaign. He was happy to talk about track work now in progress in Scarborough (on the Stouffville corridor) as being part of Smart Track, when in fact it is the double-tracking work for improved GO service that was in the works before he even ran for office. And he still talks of this as if it were an $8 billion project when a great deal has been lopped off of the project’s scope.

Finally, the TTC CEO Andy Byford is happy just to see money coming his way from all three governments on both the capital and operating sides (although, the latter more grudgingly from the City).

As for construction, that’s still some years off, and it will be important to think of the project in phases, not as one megaproject. It will take five to six years to get to “shovel ready” status, and the issue then is how quickly we want to build the line. A lot of transit capital planning lately has been hostage to constrained finances at both the City and at Queen’s Park. By the early 2020s, the Scarborough subway project should be winding down and spending can shift to the Relief Line.

Now in all this excitement, if only someone would treat other orphaned projects like the Waterfront and Sheppard LRTs seriously.

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TTC Board Meeting: May 31, 2016

The TTC Board will hold its regular meeting at 1:00 pm on May 31, 2016 in Committee Room 1 at City Hall.

Items of note on the agenda include:

  • The monthly CEO’s Report
  • Purchase of 97 diesel buses
  • Metrolinx response to a request for additional parking in the Kipling Terminal project

The agenda also includes the draft financial statements which I covered in a separate article.

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Who Pays For The TTC 2000:2015 (Revised)

May 24, 2016: This article has been revised to reflect an inconsistency in my handling of Wheel Trans operating subsidies over the period. Specifically, up to 2009 I had included them in the total subsidy, but from then on, I had excluded them. This has been corrected and the WT subsidy is now shown as a separate component. Also, a one-time provincial WT subsidy in 2008 has been included.

In previous articles, I reviewed the details of TTC funding in the annual financial statements up to 2013. With the publication of the draft 2015 statement, it’s time for an update. This and other reports will be considered by the TTC’s Audit and Risk Management Committee on May 25, 2016.

The full set of charts used in this article is available in the following PDF:

2000 2015 Subsidy Summary_Revised

Caveats:

  • This analysis consolidates information from several parts of the notes to the financial statements and is presented in a different manner from those statements to simplify tracking by year and source of subsidies. Although the numbers all come from “official” sources, the arrangement and presentation is my own.
  • In 2015, the City’s operating subsidy included a “capital from current” payment of $19.2 million that purchased 50 new buses. Although this was booked as an operating subsidy (for reasons shrouded in the mysteries of that year’s budget fiddling by the Mayor and Council), it is really a capital subsidy and I have counted it in that category for consistency. This one-time subsidy disappears in 2016, but this is not a “cut” in operating funding.

Operating Subsidies

The TTC’s operations are funded primarily through the farebox. In 2015, fare revenue contributed $1.109 billion while other sources (advertising, outside city services, rentals and miscellaneous) brought the grand total to $1.179 billion. The remaining $518.6 million was funded by the City of Toronto and Province of Ontario.

Over the years, Ontario subsidy has been paid primarily through a share of its Gas Tax revenue. Ontario transfers a lump sum to Toronto, and the City splits it between Operating and Capital budgets. The amount going to Operations has not changed for many years.

Ontario under the Harris government killed off all operating subsidies, and they did not return until 2004. The explicit link as a share of gas tax began in 2006, and a special subsidy was paid in 2008 because of the unusual financial circumstances of that year.

The total subsidy grew consistently to 2009 (the last year of the Miller administration at City Hall), but it was cut back under Rob Ford and more or less flat-lined through to the first year of the Tory regime. For 2014, funding rose again to the 2009 Miller level, but of course this makes no allowance for inflation over the intervening years. For 2015, the second year of the Tory mayoralty, there was an increase in operating funding. (Note that the Capital from Current payment has been excluded here and combined with the Capital Budget funding shown later in this article.)

The subsidies are presented in two formats below: total subsidy received, and individual sources. Either way, it is clear that the City of Toronto has carried the lion’s share of the operating subsidies. This is a far cry from the era when the City and Province split this cost 50-50. Over the 16-year period, the total paid by Toronto was $4.85 billion while Ontario paid only $1.20 billion.

20002015_OperatingSubsidies_Revised

The chart below shows the components of the operating subsidy separately. Except for 2008, the City’s funding of Wheel-Trans has grown, albeit slowly even when conventional service funding was cut back. The result is that the “conventional” cuts as a percentage are deeper than when the numbers are presented in aggregate.

20002015_OperatingSubsidies_Separated_Revised

Capital Subsidies

Capital subsidies pay for new projects such as the subway to Vaughan (aka “Toronto York Spadina Subway Extension” or “TYSSE”) and for replacement of worn out infrastructure and rolling stock. The money arrives in various ways depending on the political and financial situation when various programs and projects were launched.

  • Some money, primarily gas tax, arrives on an annual basis.
  • Some money comes from reserves that were funded through budget surpluses when times were good (generally before the 2008 financial meltdown).
  • Some money comes from “commitments” by governments that are paid out as the projects they fund proceed.
  • A large portion of the ongoing capital program is funded by the City of Toronto through a combination of current revenues and debt.

In the first chart below, the total capital spending shows large growth over the past decade primarily due to the TYSSE project and major fleet updates. The gas tax contributions are broken out here to show how relatively small they are compared to other sources of funding.

“Other” includes money from York Region for its share of the TYSSE and from Waterfront Toronto which is itself funded 1/3 by each level of government.

The amounts here are only for spending through the TTC itself and do not include Metrolinx LRT projects within Toronto.

20002015_CapitalSubsidies

The second chart presents the same data but with the sources broken into separate columns. This shows quite clearly the increased level of capital spending by the City of Toronto compared to other sources. Over the 16-year period, about 47% of all capital funding has come from the City with most of the remainder split between Canada (23%) and Ontario (26%).

20002015_CapitalSubsidies_Separated

The third chart consolidates gas tax and other subsidies by government, and breaks out the York Region contribution for the TYSSE.

20002015_CapitalSubsidies_ByGovernment

Gas Taxes

Although we hear a lot about contributions from both levels of government through the gas tax, it is important to remember that the actual amounts have been almost flat for several years. In real dollar terms, the amount is declining thanks to inflation. Ontario’s gas tax is split between the Operating and Capital budgets at the City’s discretion.

20002015_GasTaxes

2005 was a special year for federal contributions because it actually covered more than one year’s revenue. The federal contribution is pegged to Toronto’s share of the national population which has actually been declining. In both cases, the total amount available is based on cents-per-litre. This does not vary with the price of fuel, but it also is linked to actual fuel consumption. As a revenue source, this is not growing and could even be eroded by fuel efficiency, a shift to lower car ownership, and a move to untaxed fuels.

Reserves and Receivables

When times are good, governments have surpluses burning a hole in their pocket that they cannot spend within the current fiscal year. To fix this “problem”, the money is transferred to a reserve usually with a name indicating how the money is to be used (and a political slogan showing how much they care about transit).

During the mid-2000s, several funds were promised, but the cheques did not actually arrive until 2007-2008. Meanwhile, the TTC (actually Toronto on its behalf) spent money in anticipation of reimbursement from other governments. The 2008 financial crisis brought an end to this sort of funding, but many reserves had been created. These have mostly been depleted as of 2015.

The charts below show the situation in aggregate, and broken down into separate reserves.

20002015_ReservesReceivables

20002015_ReservesReceivables_Separated

  • CSIF: Canada Strategic Infrastructure Fund. Most of the money in this reserve has been spent, and the fund is supposed to wind down in March 2016, although an extension has been requested.
  • PTCT: Public Transit Capital Trust. This federal program was short-lived and the reserve was depleted in 2008.
  • ORSIF: This was an Ontario program to give the TTC money for rapid transit infrastructure outside of the standard subsidy channels as Toronto was the only city with this type of transit. The reserve was depleted in 2011.
  • OBRP: This was an Ontario program to fund bus replacements, but it no longer exists. Most of the funding came into and out of City accounts in the same year, and so little appears in the reserves.
  • TTIP/GTIP: More discontinued Ontario programs for transit improvement. Like OBRP, little of the money stayed in City accounts long enough to show up in the reserves.
  • Quick Wins: This is the 2010 Metrolinx program to fund various system improvements. The reserve will likely be depleted in 2016.

Unless there is a major change in funding principles by Ontario and Canada, the use of reserves will likely disappear from transit budgets to be replaced by in-year funding either for specific projects (reimbursing spending as it occurs) or as block transfers (like the gas tax) for use by the City at its discretion.

Project-Based Funding

TYSSE

The Spadina extension to Vaughan is funded by Toronto, York Region, Ontario and Canada. To the end of 2015, the proportions contributed by each level of government have remained the same with only the total dollar amount moving up and down. From 2016 this will change as the cost overruns on this project will not be equally shared with the local municipalities on the hook for the extra spending.

20082015_TYSSE

Transit City

Metrolinx took over the Transit City projects from the TTC and reimbursed the City for its costs. Funding continues to show up in the financial statements because of work done on Metrolinx’ behalf by the TTC. Note that any clawback of sunk costs for the Scarborough LRT will require that some of this funding to be reimbursed to Ontario.

20092015_MlxTransitCity

Low Floor LRV Project

The TTC is buying 204 new low floor streetcars from Bombardier with the cost subsidized 1/3 by Ontario. As is common in vehicle supply contracts, front-end loading funds the vendor’s startup costs and the remainder is paid out as vehicles are received and accepted. The lack of progress on this project is clear in the low levels of subsidy paid out in recent years.

20092015_LFLRV

Scarborough Subway Extension

As of 2015, this is not an approved project because Council has not finalized the route design and there is no approved Environmental Assessment. Toronto has been accumulating revenue from a dedicated SSE tax in its accounts, but this does not show up in the TTC financial statements.

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TTC Service Changes Effective June 19, 2016

Many changes will affect TTC operations with the onset of summer schedules for 2016. These include both the usual seasonal changes to service levels, several construction projects affecting routes, and the restructuring of routes serving the waterfront.

Updated May 24, 2016 at 7:30 pm: Preliminary information on construction diversions at Broadview Station has been added to this article.

2016.06.19 Service Changes

The information in the spreadsheet linked here is organized into three sections:

  • Routine, mainly seasonal, changes
  • Groups of changes related to specific projects and route reorganization
  • Construction project calendar

20160619Map514Changes

The 514 Cherry streetcar route begins operation running via a short spur south from King to Distillery Loop. Initially this will run with a mix of Flexities and CLRVs pending an increase in the fleet of new cars. Eventually track on Cherry will extend under the rail corridor and south into the Port Lands, but that is a project still years away and subject to the usual wrangling at Council about capital spending priorities.

In the 2016 Budget, the TTC Board and Council chose not to fund the new service with additional money, and so this operation will be implemented by cutting service on the outer ends of the 504 King route. Peak service will operate every 8-9 minutes, and off-peak periods, the line will operate on a 15 minute headway with five cars. A blended service on King is impractical given the large difference in frequencies between the 514 and 504 routes. Whether the Cherry cars actually pull out onto King into gaps and carry passengers, or merely slip in behind King cars and let them do the work remains to be seen.

The 172 Cherry Street bus has been replaced by an extended 72 Pape over a new route serving Queen Quay East, and by a new 121 Fort York – Esplanade bus that will operate on, at most, 15 minute headways, a considerable improvement over the former 172 Cherry.

Sunday Stops

The TTC continues its program to remove Sunday Stops from the system with removal of stops at the following locations.

20160619SundayStops

Streetcars Return due to Bus Shortage

With the onset of construction season, and despite the summer service cuts, several streetcar routes will be partly or completely replaced by buses: 512 St. Clair, 511 Bathurst, 506 Carlton. This will be offset by the return of streetcar service to the 502 Downtowner and 503 Kingston Road Tripper lines, as well as full streetcar service on 504 King with no bus trippers. Service will likely revert to combined streetcar/bus operation in September thanks to the late deliveries of new Flexity streetcars by Bombardier.

Construction Work on College Street

Several projects on College Street West have been timed to occur over the summer of 2016.

  • Special track work replacement at Bathurst and at Lansdowne
  • Removal of safety islands at Bathurst eastbound and at Bay Street both ways
  • Expansion of the safety island westbound at Bathurst
  • Water main upgrades on College and on Lansdowne
  • Streetscape improvements on College

The effects of these will be:

  • 506 Carlton will operate with buses in the west and streetcars in the east on weekdays, and with buses over the entire route on weekends. The weekday services will overlap between Church and Bay. This will continue throughout the summer.
  • 47 Lansdowne will divert around the construction area via Dufferin Street.
  • 511 Bathurst will be operated by buses until the next schedule change at the end of July diverting around construction via Spadina between Harbord and Dundas.
  • The 509/511 bus shuttle on Fleet Street will be replaced by the 511 bus service.

Details of the service diversions are in a separate article.

When streetcar service returns to Bathurst Street, the cars will operate into Exhibition Loop so that through service is provided until the Labour Day weekend. In September/October, service will be cut back again to Fleet Loop for a track replacement project in Exhibition Loop.

St. Clair Construction

Major construction work at St. Clair and St. Clair West Stations will require removal of streetcar service over the summer and early fall. The approach ramps at St. Clair West were not rebuilt during the line’s reconstruction, and the track must be replaced. The entire 512 route will be operated with buses through the summer, and streetcars will return from St. Clair West to Keele in September. Full streetcar service will resume on the Thanksgiving weekend in October.

Buses will not be able to enter either station during this project. At St. Clair Station, all bus service will loop on street via Avoca, Pleasant Boulevard, Yonge and St. Clair with transfer connections at the Pleasant Boulevard entrance. At St. Clair West Station, the 90 Vaughan bus will be extended south to Bathurst Station, and routes 33 Forest Hill and 126 Christie will be interlined. All buses will make an on street transfer connection at St. Clair West.

Broadview Station Construction

The bus loop at Broadview Station will be rebuilt over the summer and all bus services will loop on street via Erindale, Ellerbeck, Danforth and Broadview using an on street transfer. Given the frequent congestion of streetcars on Broadview awaiting entry to the station, the bus service will add to the congestion at Danforth northbound. The arrangement of on street stops for the four bus routes affected here has not yet been announced. Running time has been added to allow for the around-the-block loop except in cases where there was already enough recovery time in the existing schedule.

Updated May 24, 2016: Brad Ross at the TTC has provided the preliminary construction notice for the service and street changes. In addition, the Brick Works shuttle bus which normally loads on Erindale outside of Broadview Station will be relocated to Chester Station.

Bayview Services Reorganized

Peak period frequent service on 11 Bayview now ends at Davisville & Bayview, but this will be extended to Sunnybrook Hospital with every second bus running through to Steeles.

The 28 Bayview South route serving the Brick Works now operates only on weekend daytime hours, but will provide service during all periods.

Victoria Park North

Service in York Region on Victoria Park will now be provided by York Region Transit. The 24D Victoria Park branch to Major Mackenzie will be dropped and all service will turn back at Steeles Avenue. The 224 Victoria Park North route will cease operation.

Richmond Street Construction

All Downtown Express services will divert westbound from Church to Peter while Richmond Street is rebuilt from Victoria to York. Whether there will be any provision to assist the left turns west-to-south at Peter that will block 501 Queen Service (itself forced to divert and turn south at Spadina for water main construction) remains to be seen.

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Ministerial Hot Air On Fare Integration

Today saw an exchange in the Ontario Legislature showing the true colours of the provincial government when it comes to an informed, intelligent discussion of fare integration in the GTHA. The full exchange is below lest anyone accuse me of quoting them out of context.

Ms. Andrea Horwath: My question is for the Acting Premier.

Throughout its history, TTC fares in Toronto have been based on the simple principle that every Torontonian deserves equal access to their transit system regardless of their income and regardless of where they live.

But now Metrolinx is quietly working on a fare integration plan that could force people living in Scarborough, Etobicoke and North York to pay a higher fare for a subway ride than people living downtown. Will the Liberal government guarantee that Metrolinx will not force people living in Scarborough to pay more to ride the subway?

Hon. Charles Sousa: Minister of Transportation.

Hon. Steven Del Duca: I want to thank the leader of the NDP for the question. Of course, as everyone should know by now, the folks at Metrolinx, who are doing an exceptional job, are working hard to liaise with all of our municipal transit systems around the greater Toronto and Hamilton area to make sure that, collectively, we can deliver on fare integration for this region.

I think anyone who moves around the greater Toronto and Hamilton area would recognize—and certainly I hear it loud and clear from my own constituents in York region—that we need to make sure, in order to support the unprecedented transit investments that this government is making, that we need a fare integration system across this entire region that works seamlessly, that makes transit more accessible, more affordable, more reliable and more dependable for the people of the entire region. That’s the work that Metrolinx is embarking upon in conjunction with all of our municipal transit systems. They will keep working hard, Speaker, to make sure that we can get it right.

The Speaker (Hon. Dave Levac): Supplementary?

Ms. Andrea Horwath: Speaker, in fact, what Metrolinx has been quietly doing is designing a fare integration plan that could force the TTC to become a zone-based system that divides Torontonians based on where they live. So years from now, people in Scarborough might get a new subway but then find out that they can only afford to ride the bus.

Will the Liberal government guarantee that there will be no fare zones within Toronto, and that Metrolinx will not force the TTC to charge higher fares for subway riders?

Hon. Steven Del Duca: I guess only the leader of Ontario’s NDP would think somehow that after months of open conversations, after months in which every single board meeting has a public portion, only the leader of Ontario’s NDP would think that this is somehow hidden. It’s a conversation that’s been ongoing.

It’s part of my mandate letter which, of course, she should know. For the first time in Ontario’s history our mandate letters were posted publicly at the time that we received them, Speaker.

I think what’s also, perhaps, the reason that the leader of the NDP is mistaken about how supposedly hidden this effort is, Speaker, is that because while we are investing in transit through budget after budget after budget, that leader and the NDP caucus continue to vote against them. They are obviously more focused on petty partisan politics in Scarborough instead of being focused on making sure that they support the transit investments needed to deliver the seamless integrated transit network the people of this region and the people of Scarborough deserve.

Let’s get the historical inaccuracy in Horwath’s question out of the way first. The pre-Metro Toronto Transportation Commission used a single fare within the old City of Toronto, and supplementary fares beyond in what were then separate municipalities where the TTC provided some services. Some suburban bus routes were operated by private companies which charged their own fares. After the creation of Metro in 1954, the Toronto Transit Commission had fare zones roughly based on the old city and everything else, but these were abandoned in 1973 as part of the political deal for suburban municipalities helping to finance transit expansion through their Metro taxes.

I am no fan of Andrea Horwath, but she asks a legitimate question.

The Minister’s response is pure political hot air talking about the wonderful work at Metrolinx, and the wonderful spending on transit construction now underway, but utterly avoiding the issue of separate fares either for zones or classes of service within Toronto. Instead, he turns the question into one of “petty partisan politics” and fails to address the matter of whether Scarborough riders will pay more to ride their new subway whenever it opens.

One might ask the same question about the Minister’s constituents in York Region who will be heavily subsidized by Toronto Taxpayers to ride the Spadina extension to Vaughan.

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Fare Integration: A TTC/Metrolinx Non-Update

Updated April 29, 2016 at 9:00 am: Information added about the joint meeting.

The joint meeting of the Metrolinx and TTC boards was something of a love-in with much generous praise of each other’s organization and shows of “working together” with joint presentations on major issues. In his opening remarks, TTC Chair Josh Colle noted that although the two organizations had similar goals, there would be times when the TTC and Toronto Council would not agree with Metrolinx. It is too early to tell whether cracks began to form in the building foundations at Union Station where the normal state of Metrolinx meetings is sunny and the concept of disagreement is banished in the (usually) well-managed agendas.

A substantial chunk of the meeting was consumed with opening remarks and overviews of the two organizations by their respective CEOs. At an initial meeting, this might be expected, but it follows a distressing pattern where substantive discussion is pre-empted by management back-patting eating into the limited time available. The idea that Metrolinx and TTC Board members would need an overview of each other’s current activities says much about the degree to which each board is informed about transit in the GTHA in general. (One might make a similar observation about some board members with respect to their own agencies, but that’s another topic.)

The TTC made a point of citing their own ridership numbers and, by implication, the scale of their operation (not to mention its longevity) compared to Metrolinx. For its part, Metrolinx noted that it has just reached 10 years of age, but completely forgot that GO Transit has been around for almost 50 years.

Cross-border travel at 58 million rides per year might increase by as much as 8 million with some form of TTC/GO/905 fare integration and the removal of the boundary between TTC and other systems, but this would still only bring the cross-border total to about 12% of the TTC’s total ridership. The main benefit of fare integration would be to reduce fares for existing riders.

In his opening presentation, TTC CEO Andy Byford dwelt at length on five “megaprojects” within the TTC, and showed a list of other major improvements in the hopper (see p34 of the presentation). All of these have been implemented at least to some degree except for Time-Based Transfers, and the idea has been sidelined for the moment in part because it is perceived to be too expensive by some city politicians. The most recent word on the subject was in a December 2015 update on fare policy:

While introducing a 2 hour time-based transfer is still considered a worthwhile service improvement that would reduce complexity and make the TTC consistent with other transit agencies within the Greater Toronto and Hamilton Area, the ongoing Fare Integration work, led by Metrolinx, may propose changes to transfer rules. That being the case, it is recommended that further analysis or implementation should follow the completion of the Fare Integration work if required. [pp. 2-3]

This is something of a Catch-22 because transfer rules are obviously part of any overall fare strategy – they affect the attractiveness of transit for multiple “short hops” on a single fare without the need to own a Metropass (or some equivalent). Moreover, the ability to make many short trips on one fare speaks to the problem of “trip chaining” often cited in debates about bias in fare policy towards longer commute journeys and against the type of travel more common to the un- and under-employed.

Transfer rules across the GTHA should be part of any “fare integration”, and yet the topic has been completely ignored in Metrolinx work to date. Metrolinx sloughs off the topic claiming that these are local policies, not regional issues, forgetting that regional planning is impossible without considering local effects.

During the update presentation, TTC’s Deputy CEO Chris Upfold noted that the TTC network is an integrated design with free movement between routes and modes. Josh Colle gave as an example the St. Clair streetcar which runs directly into two subway stations and talked of how the system would have to be “de-integrated” to accommodate a separate fare for subway travel.

Metrolinx Chief Planning Officer Leslie Woo replied that the concepts in the study are only for analysis with a business case, economic and operating impact studies to follow. Considering how long the study has been underway (see main article), one might think that economic and operating impacts would have been an integral part of early analysis to determine whether options were viable. Instead, Metrolinx forged onward with its preferred view of fare structures strongly leaning to a distance and class-based tariff ignoring the issues for transit operations, not to mention the potential effect on riders. Again, the blinkered view of an agency with relatively small ridership and a uniform demographic precluded consideration of the effect on an operation ten times its size serving much more complex travel patterns.

TTC Commissioner Shelley Carroll asked about reports to come in fall 2016, and their implication for actual implementation of new fares. Woo replied that Metrolinx is very open to meeting with area Councils, agencies and transit management. That reply dodges the basic problem that Metrolinx has acted as the gorilla in the room in its dealings with local transit agencies, and the threat of losing provincial subsidy always hangs over municipalities who don’t sing from the Metrolinx songbook.

Chris Upfold stated that the TTC Board and Toronto Council need to take a position on fare integration. He suggested that this cannot happen until something is actually proposed, and nothing is going to happen to fares within 2016. That’s all very well, but Metrolinx history shows that once a proposal emerges from staff, it acquires the endorsement of a provincial agency and is cast, if not in stone, in very fast-setting concrete and is almost impossible to change. Toronto needs to understand what a new tariff would actually look like in order to take an informed position. Otherwise, the process is nothing but endless rounds of approving “principles” that could have far-reaching effects. “Equity” to one person might mean time-based transfers (in effect limited-time passes), while to another might mean fares charged by distance and class of service.

“We can leave the decision to later” is a recipe for Metrolinx cooking up a tariff and claiming that Toronto (or other cities) don’t object when the process precludes such objections until after the tariff is fixed. This is the same cart-before-horse process we see in transit project assessments (mini-Environmental Assessments) where early decisions discard options that are almost impossible to reinstate later even if the early work is shown to be flawed or outdated.

Metrolinx Board Member Iain Dobson asked why we couldn’t just “do something, somewhere” such as eliminating the Mississauga/Toronto fare boundary as a trial. Upfold replied that Presto would have to be in place for this (so that fares paid on one system would be valid on the connecting legs of a journey), and that there would be a need to fund such a reduction in fares for the affected riders. The fact that both agencies have had paper transfers for ages and could simply adopt a policy of accepting each other’s as a valid fare seems to escape him.

TTC Commissioner Joe Mihevc noted that “fare integration” is one of those areas where the mandates and outlooks of the regional and local agencies and councils will not align. Toronto residents may not be happy with using the TTC to support lower fares for the 905.

Metrolinx Chair Rob Prichard opined that a $40 million cost to provide an integrated fare is not much of a problem. He should talk to his good friend, John Tory, for whom this amount is more than a 1% tax increase, and who has torpedoed much less expensive transit initiatives through TTC budget cuts.

TTC Vice Chair Alan Heisey remarked that Toronto already subsidizes the 905 by about $50 million annually through the TTC operating subsidy, and Commissioner Rick Byers reiterated that the TTC already has the lion’s share of the region’s transit ridership.

Prichard ended the discussion saying that we don’t know what the right answers are now. One might ask “why” considering how long his staff have been working on the question.

In the media scrum following the meeting, Josh Colle was asked whether subway riders should worry that their fares are going up. He replied that, no, this should not be a concern and gave as strong an indication as any we have seen to date that the whole “subway fare zone” concept is dead in the water. It is amazing what a little political realism can bring to a debate.

As I have said in other forums, I would love to attend a public meeting where the Scarborough MPPs and Councillors (not to mention the well-meaning social activists on the Metrolinx Board) explain to their constituents how they will get a shiny new subway, but will have to pay more to ride it while commuters from Markham enjoy lower fares.

Original article (April 25, 2016):

The TTC and Metrolinx boards will meet in a joint session on the evening of April 27, 2016. Among the items to be discussed is an update on the Fare Integration study that has been underway for some time between these agencies and other GTHA operators.

Based on discussions at recent Toronto Council and TTC meetings regarding the “motherlode of reports” that will hit Council in June on a wide variety of transit issues, one might have expected something definitive about Fare Integration. Alas, this will not be so as the projected date is now in fall 2016. That poses a challenge for discussions of SmartTrack (ST) which depends strongly on integration with the TTC network and fare structure for its attractiveness. Of course, given that ST has dwindled to no more than a few stations added to what the GO Regional Express Rail (RER) would provide anyhow, the point may be moot. However, as long as we pretend that ST is a going concern, then its fare structure remains an issue for debate.

Chris Selley in the National Post wrote recently about the importance of Fare Integration and the political minefield it represents. Recently we have seen just how badly Metrolinx can screw up its planning with the botched implementation of the UPX service to Pearson Airport. The idea of Fare Integration has been around for some time, but discussions have always been quite general on matters of principle and general concepts with no explicit examples of how various schemes might affect riders or subsidy requirements.

It is worth reviewing the history of reports to the Metrolinx Board on this subject.

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TTC Service Changes Effective May 8, 2016

May 2016 brings the first wave of seasonal changes as attendance at universities and community colleges drops, and demand for travel to parks ramps up for the summer.

The 101 Downsview Park bus will now operate on weekdays. This was formerly a seasonal service, but the change is now permanent and it will not be reversed in the fall.

Several bus routes get new early morning trips.  Individually these are small changes, but they illustrate how the city’s work day starts well before the subway opens at 6:00 am.

After several years’ absence for construction on Queens Quay, the Sunday afternoon PCC operation will resume between Victoria Day and Labour Day weekends. One car will run as an unscheduled extra from noon until 5:00 pm on 509 Harbourfront.

Route 501 Queen will divert around water main construction on Queen Street West from May until early October via Spadina, King and Shaw both ways with a replacement shuttle bus covering the gap. Route 510 Spadina will have extra running time to allow for the expected delays caused by the 501 diversion, and the short turn service will remain scheduled to Queens Quay rather than to Charlotte to limit turning moves at King and Spadina.

There is no information yet about special provisions to assist streetcars turning, particularly to and from Spadina, such as changes to traffic signals or use of police to manage traffic. Also unknown is how the congestion this diversion will cause will interact with the King Street closure for the film festival in September.

The 97 Yonge bus will be split with overlapping services running south from York Mills and north from Lawrence, and midday service between St. Clair and Davisville will not be operated. This is intended to isolate the effects of construction at Sheppard to the north end of the route, an arrangement used previously in 2014.

2016.05.08 Service Changes

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Asking Santa For Transit Dollars (Updated)

Updated April 15, 2016: Further information received from the Infrastructure Canada has been incorporated, as noted, in this article.

The new, transit-friendly Trudeau government has announced a major shift in Ottawa’s funding for municipal transit including policy changes to improve the flow of money:

  • Decisions about which projects should be funded with federal dollars will rest with local agencies rather than being dictated by Ottawa.
  • Federal funding will pay for up to 50% of projects compared to previous schemes in which each level of government contributed 1/3 (e.g. the Vaughan subway extension).
  • The pool of funds will be distributed based on ridership, not on population, so that provinces with well-used transit systems will receive most of the money.

In the first three years, $3.4-billion will be allocated with about 44% coming to Ontario. Of this, the TTC expects to see about $880-million according to TTC Chair Josh Colle as quoted by the CBC with money going to “what can be done quickly” with “the greatest customer impact.”

That will be a challenge on a few counts.

The TTC’s Capital Budget for 2016-2025 includes about $2.7-billion in unfunded projects, but some of these are not planned to start, indeed are not even required, in the immediate future.

PrelimANotes_CapBelowTheLine

The table above (from the City Budget Analyst Notes) shuffles around a bit every time we see it, but the outline remains the same. The serious problem with capital funding begins in 2018 when the City’s headroom for additional borrowing (in the absence of some other scheme to finance its capital programs) will be exhausted.

The $55.4m shown for 60 additional streetcars may or may not actually be triggered as a 2016 expense depending (a) on how many cars Bombardier delivers this year, and (b) on how much Toronto trusts Bombardier with an add-on order when the base contract is running so late.

Most of the list above deals simply with replacing or repairing vehicles and infrastructure that are at the end of their natural lives, and only a small part of the total (99 buses, 60 LRVs) would actually bring more service and capacity to the system. Toronto has not shown much enthusiasm for funding additional operating costs that a larger fleet represents and persists in the belief that ridership growth can somehow be handled by “efficiencies” within the base budget.

Another problem, of course, is that if $2.7b is “below the line” in unfunded status, and Ottawa is prepared to contribute only 50%, then the remaining 50% still has to come from somewhere, likely from the City of Toronto which claims to have no ability to finance this spending.

Many other projects are not even included in the ten year budget notably Waterfront transit and the Relief Line, not to mention some costs associated with capacity expansion on the existing subway. Queen’s Park is funding the first wave of LRT construction in Toronto, but other proposals sit on the wish list:

  • The main section of the Crosstown from Mount Dennis to Kennedy is fully funded by Queen’s Park, as is the Finch West LRT from Finch West Station to Humber College.
  • The Crosstown East LRT is to be funded through a shuffle of available money among Scarborough transit projects. It is not yet clear whether changes to SmartTrack and the Scarborough Subway Extension will actually balance out the LRT’s full cost.
  • The Crosstown West LRT would, in theory, be funded from “savings” through the cutback of SmartTrack to Mount Dennis, but ST itself is not fully funded or costed. How much will actually be available remains to be seen, especially when Queen’s Park’s share will only be an “in kind” contribution through GO-RER upgrades.
  • The Finch West LRT extension to the airport, the Crosstown extension north beyond UTSC to Malvern, and a Sheppard East rapid transit line have no funding.

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Where Is TTC Ridership Going? (Updated)

Updated March 25, 2016 at 1:45 pm: Charts and commentary have been added at the end of this article regarding monthly ridership statistics published by the TTC through the CEO’s Report.

In a previous article, I wrote about a TTC management report giving a “Ridership Update” for early 2016. This was triggered by concerns that overall ridership had stagnated, and the obvious question management might hear: “what are you doing about this”.

During the debate at the March 23, 2016 Board meeting, it became clear that to some extent, management was making up the story as they went along. The report includes data for the first two months of 2016, and February was particularly bad with a drop against both the budget target and against results in 2015.

20160323_JanFeb16Ridership

However, once the debate was well underway, management reported that March to date was almost on budget, and was up 2.5% over 2015. Why was this information not in the report, or at least in a supplementary paper published before the meeting got underway? The entire tone of the debate would have changed with the sense that, maybe, things were turning around and ridership was growing again.

The situation was further complicated by repeated claims from management and from TTC Chair Josh Colle that ridership was not on a decline, but that it simply did not achieve its budget target. This quite flatly is not true as anyone capable of reading TTC reports can see.

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