Recently, I have written two pieces for other publications. For those who did not see them, here are the links:
Toronto Budget Shortfalls Threaten Transit Plans on Torontoist
UperHop Symptom of Toronto’s Transit Woes on the Toronto Sun
Finance
TTC Proposes New Fare Rules for Presto Roll Out
On December 16, 2015, the TTC Board will consider a report from management recommending several changes in the fare collection system. Some of these proposals are straightforward while others are likely to bring confusion and outright complaints from TTC riders.
On December 14, the TTC streetcar system goes to “Proof of Payment” (POP) on all routes and a few days later, Presto will be enabled across the streetcar system. In the short term, paying by Presto will be akin to dropping a token in the farebox on the “old” streetcar fleet. If you need a transfer, board at the front door and get one from the operator. Otherwise, rear door boarding is allowed. Transfers will be required if somewhere in your journey you will encounter a bus that is not Presto equipped. (The TTC is silent on how they will handle a route like 504 King that operates both types of vehicle if a Presto user discovers a non-Presto equipped vehicle is the first thing to show up.)
The roll out of Presto brings the opportunity to revise the fare system, for good or ill, as the TTC migrates away from its conventional model of tickets, tokens and transfers. (It is worth noting that a large number of riders have already made this migration by using Metropasses which are simple, if limited in the fare options they provide.)
The transitional period when both Presto and existing fare payment systems co-exist will be a difficult one. Indeed, there are strong incentives for riders not to shift to Presto until the system is fully functional unless their TTC usage is limited to that part of the network where Presto is active.
TTC Service Changes Effective January 3, 2016 (Updated)
Updated December 8, 2015 at 12:30 pm: I checked with the TTC about the termination of both the 509 Harbourfront and 511 Bathurst routes at Fleet Loop rather than simply running one route between Bathurst and Union Stations. Here is the reply from TTC Service Planning:
We considered running a 511 (Bathurst Stn-Union Stn) service but ruled it out for two main reasons. Firstly, stop usage on Fleet west of Bathurst has greatly increased in the last year, and serving these stops only with the shuttle bus would introduce a transfer or longer walk for too many people. Secondly, because of the road configuration and traffic patterns, it is not possible to have a northbound stop for through 511 cars on Bathurst at Lake Shore. The nearest stop would be the existing 509 stop on Bathurst farside of Queens Quay. This adds to the walking distance for customers heading to Fleet Street, and requires customers to cross an inhospitable intersection.
The original article follows below:
The new year brings changes to some routes, mainly on the streetcar system, to deal with the shortage of new Flexitys and a construction project while improving service on 501 Queen, 502 Downtowner and 503 Kingston Road to better reflect actual conditions.
City of Toronto 2016 Budget Overview
On December 1, 2015, Toronto’s new City Manager, Peter Wallace, presented an overview of the state of the City’s finances to the Executive Committee. This was by way of an introduction to the 2016 budget which will launch on December 15. Wallace’s talk can be viewed on YouTube, and the slide deck from his presentation is on the City’s site.
Wallace’s approach to the budget is a breath of fresh air on two important accounts. First, he believes that the proper roles for Council and for the City Staff are policy and implementation, respectively. Second, he begins the budget cycle without the now-familiar annual exercise of wrestling the “budget gap” down to zero before Councillors even have a chance to review the numbers. These combine to place responsibility for choices and options where it belongs, at Council, rather than having a back-room hatchet job done by staff without the tradeoffs and options ever surfacing for public debate.
The City Manager is quite clear: decide what kind of City you want and then figure out how to pay for it.
Moreover, Wallace is very clear that the City has been living a charmed existence thanks to very strong revenues from the Land Transfer Tax, and because a large and growing backlog of unfunded capital projects has not been included in the City’s financial planning.
Politicians depended on staff telling only good news so that tax cuts and other giveaways could proceed without arousing questions of where the money will come from, or what might not be built without the lost revenue. That was certainly the case through the Ford era and the early part of John Tory’s mayoralty, but this extends even back into David Miller’s term. The concept of “below the line” budgeting was used to keep some capital requirements off of the books in hopes of major contributions from other governments, and to make the City’s long-term exposure look less dire to maintain a favourable bond rating.
From 2000 to 2015, the total City revenue per capita has grown by 19.7%, and the City’s share of the region’s economic activity has stayed at the same level (in other words, the City has not become relatively a larger or smaller part of the regional economy). What has changed is the proportion of income received from various sources.
TTC fares as a proportion of the total have risen from 9.6% to 10.5%, Utility Fees have gone up by about 50%, and Other User Fees have fallen. The property tax which formerly accounted for about 40% of City revenue now is only 33.5%. Most of this reduction comes from lower non-residential taxes (about which more below).
Land Transfer Tax may only account for 3.8% of total revenue, but that is out of a very large total and it represents several hundred million dollars annually.
Development Charges and Politicized Transit Planning (Updated)
Updated November 26, 2015 at 11:00 pm: A follow up article by Jennifer Pagliaro includes reactions from Mayor Tory. My comments appear at the end of this article.
The Toronto Star’s Jennifer Pagliaro reports that the Building Industry and Land Development Association (BILD) will challenge Toronto’s planned increase in Development Charges for the Scarborough Subway Extension (SSE) at the Ontario Municipal Board (OMB).
[BILD is] challenging the planning foundation for the three-stop subway — which council controversially approved last term over a seven-stop LRT that was fully funded by the province. BILD is raising red flags about the city’s ridership projections.
Bryan Tuckey, BILD’s president and CEO, says homeowners across the city should not be on the hook for a “political decision.”
“The ridership numbers that we have demonstrate that what’s needed in that area is light rapid transit,” Tuckey, whose background is in city and provincial planning, told the Star.
“We want to have fair and accountable use of development charges.”
This action has implications well beyond the Development Charges (DCs) for the Scarborough Subway and touches on the whole question of transit financing and planning that for years has been more about political gamesmanship than about the actual needs of the City of Toronto.
We know that the development industry does not like paying one cent more than they have to, and preferably less, in taxes. In that sense they are no different than other taxpayers.
However, while homeowners can only express their opposition by voting for politicians with vague promises to fight waste at City Hall, and hope that their “champions” like Ford and Tory will “do right” by them, their only real recourse is at election time. Elections are fought on signature platforms like SmartTrack and “Subways Subways Subways”, and voters don’t get to cherry pick the platform lines they really want. Elected politicians claim they have “a mandate” when their victory may simply depend on “not being the other guy”.
Development Charges, on the other hand, have specific rules about how they are calculated and an appeal mechanism neither of which is available for general property taxes (or many other taxes Council can or could levy of which the Land Transfer Tax is one obvious example). As the Star notes, most of the City’s share of the SSE ($910m) will come from the subway property tax yielding $745m. This tax will rise to 1.6% in 2016 and then stay on tax bills for decades. The amount coming from DCs ($165m) is much smaller, but developers have an appeal option through the OMB.
TTC Capital Spending Priorities
Lost in all the debate about the TTC’s Operating Budget and fare increases for 2016 was the approval of the 2016 Capital Budget and 10-year plan out to 2025. There wasn’t much debate because the Board was worn out from the fare issue, but a few comments were worth noting before a very perfunctory approval of a $9-billion budget.
This is a very big, complex budget (see my previous article for some details). The Board only knows about it at the broadest possible scope – the really big projects and the major “state of good repair (SOGR)” budget lines – but there’s a lot more under the covers.
For the gory details of each project’s actual content and purpose, one needs to read the two-volume “Blue Books” which have not yet been published for the 2016 cycle. In past years I have included extracts from them in articles to give background info. The Board members will each get a set, eventually, but one requires a strong constitution to read through the equivalent of two Toronto phone books. Having done this for many years, I have the advantage of needing to look only for what has changed, but someone coming to this as a novice wouldn’t make it even part way through the first volume before the amount of detail bored them to sleep.
I do not expect my readers to look at every line of the budget, nor do I expect this of the Board members. Even I do not read every line.
One of the big challenges to a reader is knowing which parts to look at first: big ticket projects, projects that have a high profile, projects which, from past experience, are worth keeping an eye on. This takes experience, and TTC Board members don’t have the time to acquire it, let alone a guide saying “start here”. There is no trail of cookie crumbs through the budget forest.
To their credit, the Board agreed with a proposal by Commissioner Joe Mihevc that they should do a “deep dive” into capital plans in 2016 before the 2017 budget cycle starts. How far down they will get depends to a great deal on how well TTC management can package the budget in a way it can be clearly understood without undue simplification. This really is an iterative process needing a broad view, and then deeper passes through the details highlighting critical parts of the budget. It is not a session for a Councillor who only cares about his pet project and queries every penny in every other budget line as if it were a waste of previous taxpayer dollars (i.e. not being spent in his ward).
TTC Fare Increase For 2016
After a long, rambling, and less-then-well-informed debate, the TTC Board has approved increases in selected fares for 2016 at its meeting of November 23, 2015.
- Adult cash fares will rise from $3.00 to $3.25.
- Adult tokens will rise from $2.80 to $2.90.
- Metropass prices (all classes) will not change.
- Student and senior fares will not change pending the outcome of a study on Fare Equity that will report early in 2016.
The cash fare last changed in 2010, while the adult token fare, then $2.50, will have gone up $0.40 by 2016.
Freezing the Metropass prices will have the effect of lowering the “trip multiple”, the ratio of the pass price to the token fare from 50.5 in 2015 to 48.8. For monthly discount plan (MDP) subscribers, the ratio will fall to 44.7. The multiple is even lower for those who can claim the transit tax credit pulling it down to 38 for MDP users. This is only available to people with taxable income against which the transit credit can be applied.
This will make the pass more attractive to riders who now feel that it is priced beyond their normal transit usage level, and of course will provide a fare freeze for all existing pass users.
The gap between the adult and senior multiple will now be wider because seniors’ fares have not changed leaving the ratio between passes, tickets and cash fares as they were in 2015.
The unfocused debate can be blamed directly on the TTC’s own Budget Committee and its failure to actually discuss fare policy beyond producing a range of options for consideration by the full Board. Absent a clear idea from Mayor Tory or the City’s own budget process of subsidy that the TTC might receive in 2016, debates about “fares” turn into efforts to minimize the subsidy call against the City where “fighting taxes” takes priority.
When the issue reached the full Board, any idea that the TTC could magically survive without more subsidy had evaporated, but we still don’t know what will actually happen to fares or service if Council fails to deal with the TTC’s shortfall.
By the end of the meeting, there were several overlapping motions on the table, the product of many Board members each cooking up their own version of an appropriate new structure and policy framework.
- By Vince Crisanti: That student and senior fares be frozen pending the outcome of the Fare Equity report in 2016. Carried.
- By John Campbell: That a revised fare structure (see below) be implemented including a $0.20 jump in the adult token fare. Defeated 10:1 against.
- By Shelley Carroll as amended by Glenn De Baeremaeker: That staff report back on a common fare multiple for adult, senior and student passes. Carried.
- By Alan Heisey: That TTC and City Transportation Services work together on improvements to enhance transit service especially for special events such as subway shutdowns, and report to the Board in six months. Carried.
- By Joe Mihevc: That all seven options for service enhancements be approved. Defeated 8:3 against.
- By Joe Mihevc: That the three options not approved by the TTC Budget Committee (Subway service reliability, three minute service on Line 1 YUS, Cherry Streetcar) be referred to the City Budget Committee for consideration. Carried.
- By Josh Colle: That the TTC and Toronto Parking Authority study means by which parking revenue can be maximized with a report to the Board in 3Q16. Carried.
- By Josh Colle: That the TTC examine ways to increase non-fare revenue and reduce office space costs through consolidation, and that staff report by 2Q16 on annual and long term revenue targets. Carried.
- By Ron Lalonde as amended above: That the TTC adopt fare scenario 7 with no Metropass, student or senior fare increase ($0.25 more on adult cash fares, $0.10 more on adult token fares). Carried.
The combined effect of these decisions leaves the TTC with a $41-million gap between its proposed budget and the 2015 subsidy level. Considering that they are not even sure of getting that much when the first cut of the City’s 2016 budget is launched on December 15, 2015, this leaves Council facing an 8.7% increase in the main TTC operating subsidy request and a similar increase (although a smaller dollar amount) for Wheel-Trans.
When the final text of these motions is published by the TTC, I will update this article.
TTC 2016 Operating Budget
On November 23, 2015, the TTC Board will consider its operating budget for 2016 including issues of fares and possible service improvements. The version of the budget before the Board was approved at the TTC’s Budget Committee meeting of November 9, 2015 with some amendments from the original staff proposal. The only recommendation related to fares was that the price of a Metropasses be frozen in 2016, but no other specifics. (I have already commented on the motions passed by the Committee in a previous article.)
The matter is complicated by the fact that the actual subsidy that will be made available to the TTC by City Council will not be set until early in 2016, and the TTC will compete with other agencies for available money.
(The 2016-2025 Capital Budget is also on the November 23 agenda, but it has not changed from the version discussed at Budget Committee.)
Although the Operating Budget report is long, it is better organized than the previous version with more detail, rather than depending on whatever questions might arise from a long PowerPoint slide deck and the skill (or lack thereof) of the presenter.
This budget is always a balancing act between competing forces and interests:
- A political imperative to “keep taxes down” and limit the growth of the TTC’s call on City subsidies from the property tax base. This often manifests itself in calls for “efficiency” year after year in the hopes that the TTC can do more with less funding in constant dollar terms.
- A political will to keep riders happy with benefits such as controlling growth in, or even freezing fares while providing more and better service. This includes targeted fare changes to benefit groups who are perceived to be more deserving of support through lower fares.
- Annual increases in the cost of labour, materials and utilities.
- The cost of additional service to handle demand from a larger population and a shift to transit from other modes.
In 2015, Council approved an extra $95-million for a number of improvements to service, elimination of the fare for children, and a capital-from-current purchase of 50 new buses to be used for new express routes in 2016. This increase only covered the part-year cost of the changes, many of which came into effect only in recent months, and additional subsidy will be needed in 2016 for the full 12-month cost. Additional improvements are on the table as part of the 2016 budget, and some of these were approved in the Budget Committee. The bottom line here is that improving transit has an ongoing cost and is not something to be done on a one year “feel good” program followed by a return to penny-pinching. Indeed, even that $95m might not have come to the TTC had Council been aware of unexpected costs from changes in Provincial funding arrangements for other programs that came to light after the extra transit money was announced by Mayor Tory and TTC Chair Josh Colle.
Metrolinx Fare Integration Survey
Metrolinx is running a survey of “fare integration”, whatever that might mean to you, until November 30, 2015.
This survey is striking in the way that it reinforces options and viewpoints commonly seen in Metrolinx analysis of fare systems. It is quite 905-centric both in the types of questions and options, and the view of how people might use a transit network.
The survey begins by asking about someone’s “typical trip” to establish an origin-destination pair. Of course, many riders within the city have many regular destinations, especially when their travel (like my own) is not dominated by commute trips to work or to school. After one gets through that section, another comes up asking about non-commute trips but with no attempt to quantify them or ascertain where they might occur.
Cross-border and multi-carrier travel figure prominently in the survey, something by which, self-evidently, a regular TTC rider using only that system is not affected. The following list of fare options reappears in different guises elsewhere in the survey. As a piece of design, it fails because some questions are in the “I can …” format while others are “would” or “should” questions. It is unclear how an “I can” question can have anything beyond a “yes” or “no” answer. Does Metrolinx want our opinion on paying one fare for all of a local transit system, or asking if I can already do this?
There is a big problem in that some options interact, but there is no provision for this. Metrolinx is obsessed with the idea of paying more for “better” service which could mean anything from a GO Train or a Highway coach, to a local express bus, the subway or even a new LRT line. One might agree with a premium for the GO train (although that would also relate to distance travelled), but not for other types of service. There is no option to distinguish between these.
The ideas reappear as a list of challenges to transit travel. For a monthly pass holder, many of these options don’t really apply although one could certainly complain about the cost (high fare multiples) and the fact that on some parts of even the TTC, transfers can be a big headache thanks to unreliable service.
Another set of options requires the choice of a top three issues and ranking them rather than using the 1-to-9 scale for all of them.
Later the survey asks about co-fares between systems including local-to-GO and local-to-local transfers, but is silent on the question of how new co-fares might be funded, indeed on the whole question of regional fare revenue and subsidy sharing. Similarly, questions about distance or zone-based fares give no hint of what the effect might be for different journeys. Time based transfer and return trip privileges are nowhere to be found, typical for Metrolinx that only grudgingly acknowledges them as an option within local systems, not for the network as a whole.
No doubt the results from this survey will be trotted out to support whatever fare scheme Metrolinx comes up with, but it could be strongly biased to “typical” Metrolinx riders who have a very different view of the transit world and fares than their (much more numerous) “local” network cousins. It would be amusing to see what a similar survey carried out for the population within Toronto would yield. The survey includes a request for one’s postal code, and so at least there should be some idea of the distribution of responses across the GTHA.
TTC Budget Meeting: November 9, 2015 (Updated)
Updated November 10, 2015 at 6:00 pm:
The Budget Committee meeting was not the best-organized or well-informed of TTC meetings thanks to a combination of factors. It was held in the boardroom at TTC headquarters which is no longer configured suitably for such events and cannot handle a large presence by the media who were out in force anticipating a story about 2016 fares. Almost all of the material was presented by one person who, unfortunately, trusted to memory rather too often and got the odd fact wrong as the meeting wore on. Moreover, there simply was too much material to absorb in the manner it was presented.
Committee members, for their part, tended to view the situation through their personal lenses of which hobbyhorse needed attention. This did not necessarily make for a broad view of TTC issues, and many erroneous assumptions, often uncorrected, crept into the debate.
We will go through this and much more all over again at the November 23, 2015 meeting of the full Board when we can also expect a very long parade of deputations on the subject of fares.
The entire exercise of having a Budget Committee has been useful, up to a point, in that some Commissioners have been exposed to the gory details, but they remain confused, and we have yet to see an actual philosophical discussion of just what the TTC should be as a basis for the budgets for 2016 and beyond.
The following motions were approved by the Committee:
Steve Munro 