Finance

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Metrolinx and the Toronto Council LRT Decision

At its February 16, 2012 meeting, the Metrolinx Board received a presentation and report on the status of projects in Toronto arising out of the Council action taken on February 8.  The report does not add much to information already reported, but it consolidates various documents in one convenient location.

The map of the 5-in-10 plan (the version of Transit City agreed to by Toronto Council in 2009 and disavowed by Mayor Ford) appears in both documents.  This map includes:

  • The Eglinton line from Jane to Kennedy with an underground section from Keele station to Laird station.  In the press scrum following the meeting, I asked about the possibility of redesign of the section through Mount Dennis (Weston Road) and near Don Mills and the DVP.  Metrolinx confirmed that details of these areas are still being worked out.  (See below)
  • The SRT rebuilt as LRT from Kennedy Station to Sheppard.
  • The Sheppard LRT from Don Mills Station to Morningside including a new carhouse at Conlins Road.
  • The Finch West LRT from Finch West Station to Humber College.

A note I received from Rick Ciccarelli (long active in transit affairs in Weston) gave further information from a public meeting on February 15 in Weston:

In speaking with Jack Collins [Metrolinx Vice-President, Rapid Transit Implementation] last night at Councillor di Giorgio’s Kodak Town Hall, he said underground [is] still in play and indicated the loading and unloading of trains at the start and end of service will be a problem for at-grade, and he also expects an interconnecting GO/TTC station to work better. He is not sure if it will go underground past this station. They are also looking at a bridge across Black Creek Drive to service the yards, plus bus connections for both TTC and regional service. The Kodak building could become a bus terminal. He said there are multiple issues to sort through before the design can be finalized including whether they are designing for 3 car LRT or full subway vehicles, and the relationship with the GO rail corridor track expansion project and the new station.

Collins confirmed at the Metrolinx meeting that the purchase of the Kodak site was concluded at about the beginning of February.  The remark about possibly designing the carhouse for full subway vehicles dates, I suspect, from a period when the actual technology to be used for the line had not been settled by Council.  Changing to full subway requires far more extensive design modifications than simply at the carhouse.

During the Board’s discussion, the question arose of interference in Council’s decision by the Ford brothers and their “Save Our Subways” scheme.  CEO and President Bruce McCuaig replied that Queen’s Park has indicated that they will listen to Council.  Chair Rob Prichard said that Metrolinx’ job was to be respectful of the Council process, and that it was not for Metrolinx to take sides with individual Councillors, but to wait for Council’s decision-making process to complete.

Director Lee Parsons asked what risk there might be that the Council debate will not be resolved by the end of March.  McCuaig replied that Metrolinx needs “certainty and clarity” from Council.  Prichard said that the “end game” is an agreement with the City, a binding agreement, and that McCuaig and his staff would move forward to a full master agreement as quickly as possible.  In the press scrum, Prichard hopes that Council will take a position endorsing a new master agreement, and referred to comments by individual members as “noise on the side”.

Director Douglas Turnbull worried that the longer the LRT versus subway debate continues — a false one he believed because LRT is the only reasonable option — that a window of opportunity for transit expansion may be lost.

Director Peter Smith noted that both Metrolinx and Infrastructure Ontario are strong supporters of arrangements where the entire provision of a line would be outsourced.  Bruce McCuaig replied that the province is committed to AFP (alternative financing and procurement) models, but various types of “package” may be appropriate.  Smith wondered whether the TTC was in any position to dictate an alternative arrangement for a facility that was not their own, and thought that the public did not understand the situation well (blaming the media for this state of affairs).

On the status of penalties for cancelled projects, Rob Prichard stated that Metrolinx would provide the City’s “expert panel” reviewing options for Sheppard with information about these and the effect of various possible options on which sunk costs could be reinstated as part of active projects.  Jack Collins said that Metrolinx has now broken down the costs per project and that the amount of sunk (unrecoverable) costs will go down as original route designs come back into the plan.  There will be some loss from the work done on tunnel design for the eastern section of Eglinton, although to whose cost this might be is an interesting point considering that Council never requested the change.

The vehicle delivery schedule must be revisited now that Finch and possibly Sheppard are  back in the mix.  Delivery dates can now move back to something close to the original contract based on the 5-in-10 plan.

Director Joe Halstead asked what differences there were between the Council motion of February 8 and the Transit City 5-in-10 plan.  Collins replied that the big issue is the status of Sheppard East although this also would have an effect on the SRT/LRT project.  If there is no Sheppard LRT and carhouse, then extension of the SRT beyond McCowan Station is unlikely.  Rob Prichard noted that the sequencing of projects may be changed depending on what is planned for Sheppard to accommodate constraints on the cash flow acceptable to Queen’s Park.

During the press scrum, the Star’s Tess Kalinowski asked at what point is Council’s position considered to have “coalesced”.  Bruce McCuaig replied that there are two points:

  • What position will Council take after the report of the Expert Panel on Sheppard?
  • How much power will they delegate to staff to negotiate the Master Agreement with Metrolinx, and will the agreement have to come back to Council for ratification?

McCuaig noted that a lot of work on the language of an agreement already existed from previous work on the 5-in-10 plan.

I asked about press reports that the Presto implementation in Toronto might be held hostage now that the Ford MoU which purported to commit Toronto to Presto was of no force.  Bruce McCuaig replied that work on Presto is still moving forward, and that implementation of the fare card is linked to other funding agreements including the streetcar purchase and the provincial gas tax share.  Metrolinx expects that an agreement for Presto implementation will go to the TTC Commission at its March 2012 meeting.

[I will report on other issues from the Metrolinx meeting as an update to my “preview” article.]

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Council Votes a Small Increase in TTC Funding (Update 3)

Updated January 28, 2012 at 10:15am:  One intriguing point about the proposed service restorations is the formula on which they are based.  Originally, the off-peak standard for frequent services was to change from “seated load” (on average) to “seated load plus 25%”.  On this basis, several routes and periods of operation would have service cut so that the allegedly existing seated loads were given 20% less service. 

(If you have five buses each with a seated load, and you cut the service to four buses (a 20% cut), then one quarter, or 25%, of the seated load from that fifth bus much be added to each of the remaining vehicles.)

Now the TTC proposes a standard of “seated plus 15%” saying that this will rescue many of the services that would have been cut.  Hello TTC.  If an existing service is already at seated plus 15%, then it is most certainly over the current standard of a seated load.  The same sort of calculation applies to the peak period bus routes that were already saved by an adjustment of the new standard.

The common point here and in the round of service cuts on lightly used routes last year is that the TTC’s riding counts are out of sync with the service they actually operate.  One one day, a revised standard may cause a service cut, but on another, amazingly, it turns out that there were more riders on those buses and streetcars than we had been led to believe.  Certainly many routes are operating beyond the “Ridership Growth Strategy” standard, and the amount of headroom to cut service is less than alleged by KPMG’s Core Services Review.  That document is a tangle of half-truths and bad research, but it was the underpinning of planned cuts to many City departments.

Why didn’t the TTC explain this during the budget reviews?

Updated January 27, 2012 at 11:25pm:  A “final budget” report on the TTC’s agenda for the January 31 meeting recommends spending the $5-million voted by Council either on restored service on the conventional system, or on avoiding a cutback in Wheel-Trans service.  The report includes a list of services that would be restored on March 25, 2012 reversing completely or partially the cuts pending for February 12, 2012.  There is no discussion of service restoration (which would require redoing the work sign-up for February on very short notice) for the period from February 12 to March 24.

While funding of Wheel-Trans will be advanced by some as a more humane way to use the $5m, the very clear intent of Council and of everyone who spoke in favour of this funding was to restore service on the regular bus system.  Wheel-Trans funding is a separate issue that even the TTC had agreed to leave until mid-year pending possible funding from another source.

At the meeting, we will see whether the Commission chooses to thwart the will of Council, and whether Councillors who voted the additional money will show up to read the riot act to those Commissioners who do not understand that Mayor Ford lost that vote, and the TTC should get on with restoring regular service.

Those who argue that the $5m is “not sustainable” because it is drawn from one-time funding conveniently ignore that it will have this status whether it is spent on regular routes or on Wheel-Trans.  Moreover, it is entirely likely that a good chunk of this money will appear in fare revenue from riding that is running ahead of budget predictions.

Updated January 23, 2012 at 10:55pm:  The option of using the extra subsidy voted by Council as part of the capital budget to pay for new streetcars has been ruled inappropriate by the City’s legal staff because this conflicts with the wording of Council’s motion.  However, because “restore service” could also be construed to refer to Wheel-Trans cuts (although that was not the intent), it is possible that the Commission might sneak through redirection of the funding anyhow.  How this will sit with Councillors who thought they were saving regular service remains to be seen.

The original article from January 18, 2012 follows:

In a surprise victory at City Council, progressive forces — an alliance of the left, the “mushy middle” and a few from the right wing — combined to restore funding in the 2012 budget in several areas including the TTC’s subsidy.  The vote on January 17 was as close as it could be with a 23-21 margin (one Councillor was off sick, and the vote would have been 23-22 if he were present).

The TTC will receive an additional $5-million for its operating subsidy in order to reverse some of the planned service cuts.  This is less than the full amount needed ($9m), and will likely result in a concentration on off-peak services.  Why only $5m?  The political compromise needed to pull together this vote involved a lot of horse trading, and many of the amounts involved for other budget areas were considerably lower — in the hundreds of thousands rather than millions — and the overall package had to stay within a scope the coalition could support.

The TTC must now consider how it will use the money, and the mechanics of unwinding cuts that have already been scheduled for mid-February.

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Metrolinx Plans a Fare Increase

The Metrolinx board will meet on Monday, January 9 to formally approve new, higher fares across the system effective February 18, 2012.  Unlike the previous fare hike of March 20, 2010 which was a flat $0.25 bump in all fares, this round uses tiered increases so that short-distance fares are not as disproportionately penalized.

  • Fares which are now between $4.20 and $5.50 would rise by $0.30 (5.5 to 7.1%)
  • Fares which are now between $5.51 and $7.00 would rise by $0.35 (5.0 to 6.4%)
  • Fares which are now at $7.01 or more would rise by $0.40 (at most 5.7%)

Considering that many GO fares are well above $7 (a one way from Kitchener-Waterloo to Union costs $14.60), that maximum increase amounts to only 2.7%.  Oddly enough, the presentation on the agenda notes that:

A flat increase disproportionately impacts shorter trips and will make any potential future fare integration arrangement with the TTC more difficult to achieve.

The 2012 increase is still disproportionately high for those who might make short journeys.  The idea that this somehow supports future fare integration with the TTC is hard to swallow.

The average GO fare is $6.55 and the average increase, allowing for the effects of discounts, will be about $0.31 (4.7%) .  If this were applied to the KW-Union fare, the increase would be about $0.70.

A chart of page 3 of the presentation makes interesting reading.  It shows various GO cost factors and their rates of increase over the past decade.  By far the highest are diesel fuel and electric power.

Concurrent with the fare increase, GO will change the discount plan for adults and students to encourage their shift from paper passes to Presto.  The discounts of 17.5% and 35% now offered to adult and student passholders respectively will stay in place for Presto fares, but the discounts for a paper pass will drop to 15% and 30%.

Like the TTC, GO faces the dilemma that adding service, even if they carry more riders, drives up costs because on average all services recover only about 80% from the farebox.  Stronger ridership with little service improvement is financially beneficial, but service improvements add to the operating costs.

With constraints on funding from Queen’s Park, passengers will have to dig a little deeper.  This is a major issue for future GO planning as they move to services that will not have as robust a cost recovery rate (two way, all day rail service).  The farebox cannot pay for GO’s evolution from a system that cherry-picks the cheapest of riders to one that provides service as a basic policy for the GTAH.

Metrolinx Board Report

Metrolinx Board Presentation

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Proposed Service Changes for February 12, 2012 (Updated)

The TTC has released plans for service cuts in February quite similar to those originally planned for January.

The battle now turns to City Council to restore funding to the TTC’s operating budget so that services can be preserved.

Compared with the original proposals for January 2012, there is one change of note.  The new proposed peak period loading standard for buses is to be increased by only 5% rather than 10%.  This has the effect of removing a number of proposed peak cuts from the list on routes where the reported average load was already close to the old standard.  Where peak loads were not close to the old standard, the proposed service cut remains in place.

With one exception, all of the proposed off-peak service cuts remain because there has been no change in the loading standard against which they are measured.

2012.02.12 Proposed Loading Standards Chart

This chart shows three peak period standards:  the existing Ridership Growth Strategy (RGS) standard, the originally proposed 10% increase for bus routes, and the revised proposal of a 5% increase.  Note that there is no change in the standards for rail modes because these were not modified under RGS.

For services operating every 10 minutes or better, the new off-peak standard moves from a seated load to seated plus 25%.  This has the effect of making the off-peak and peak standards close to each other, and busy routes will feel crowded all day.  There is no provision in the standards for service reliability, and where buses operate on irregular headways, most riders are on the crowded vehicles and experience much worse service than the standards would imply.

The following routes where peak service cuts were originally planned will now retain their existing service levels:

  • 192 Airport Rocket (PM)
  • 7 Bathurst
  • 6 Bay (AM)
  • 11 Bayview / 28 Davisville (AM)
  • 9 Bellamy
  • 17 Birchmount (AM)
  • 42 Cummer (AM)
  • 23 Dawes (AM)
  • 25 Don Mills (AM)
  • 29 Dufferin
  • 32 Eglinton West (AM)
  • 39 Finch East
  • 41 Keele (AM)
  • 54 Lawrence East
  • 57 Midland (AM)
  • 116 Morningside
  • 79 Scarlett Road (AM)
  • 85 Sheppard East (AM)
  • 24 Victoria Park
  • 112 West Mall (AM)
  • 95 York Mills (AM)

For the cynical, this means that at least the service won’t get any worse, but offers little hope for improvements where over crowding is already a daily fact-of-life for riders.

As before, the notable changes fall on off-peak services on busy routes including major streetcar and bus routes.  The intent of RGS was to give better off-peak service through a tighter loading standard to reflect the system’s latent capacity to operate better off-peak service at lower marginal cost than peak service.  Ridership growth came through the additional comfort, such as it was, of the improved service, but the TTC now risks choking off one of its cheaper ways of attracting new riders to the system.

There are some service increases to deal with stronger riding, but these are few beside the long list of service cuts.

There has been no public discussion of the proposed new standards, nor of standards in general including the degree to which the TTC has budget headroom to handle new demand beyond a very modest planned growth over the actual level in 2011.

2012.02.12 Service Changes

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How Many Buses Does Toronto Need?

Toronto’s budget debate for 2012 brought many issues of transit financing into the open thanks to an ill-considered proposal by Mayor Ford to cut transit operating subsidies by 10%.  Recently the TTC put off implementing service cuts originally planned for January 8, 2012, pending a decision by Council on the final version of the budget and the level of TTC subsidy.

However, the TTC’s Operating Budget is not the only one that is constrained by City spending policies.  On the Capital Budget, the total projected City borrowing required to pay for all of the projects the TTC would like to undertake exceeds a self-imposed target on total City debt.  To bring the 10-year debt projection within that target, the TTC restructured its capital plans.

Some projects were postponed beyond the 10-year window so that some or all of the spending (and associated debt) did not count, or might be offset by future improvements in subsidy programs from other levels of government.  Other projects were modified in scope or cancelled.

I discussed the amended Capital Budget in a previous article, but the current debate about Service Standards also has a capital component.  Among the cutbacks on the capital side were a purchase of new buses and the provision of storage space to hold these vehicles.

An order for 134 new buses (of which 26 were for “contingency” to handle unexpected growth in demand) has been cancelled along with the provision of temporary yard space.  Before Transit City was proposed, the TTC had planned to build another bus garage to accommodate its growing fleet.  However, Transit City (plus the opening of the Spadina subway extension) would replace some existing bus service with rail, and reduce the total bus fleet requirement.

Even with a short-term pre-Transit City bulge, only temporary storage would have been needed.  However, now that much of Transit City has been either cancelled or pushed off into the next decade, there will be continued pressure on the bus fleet and on the need for storage space.

  • The Spadina extension will not open until late 2015.
  • The Sheppard subway, if it is actually built, will cover only the portion of the Sheppard East bus services west of Kennedy.  Service east to Meadowvale will still be provided by buses.  The original opening date for the Sheppard LRT was 2013.
  • Finch West will continue to be served by buses, not an LRT line that originally would have opened in 2013.
  • The proposed extension of the SRT to Malvern was originally planned to open in 2015.  In the revised plan, this extension has been dropped.

In a briefing note, TTC’s Chief General Manager Gary Webster states that the capital cost of restoring the bus order and storage for the vehicles could be up to $93-million.  However, in the TTC’s budget presentation, this number is stated as $73m (see Shortfall Reduction Plan on page 52).  If the order is reinstated, the quantity of buses will be smaller by at least the contingency of 26 according to staff comments at the TTC’s last meeting.

The challenge in this whole process is to understand just how big the bus fleet should be given the robust state of TTC ridership.  For this we must first go back to the bus fleet plan as it existed in 2006.

There were two competing views of the future for ridership.  In one version, growth would continue at just over 1% per year following a long trend of the past decade.  In another version, growth would be more robust at 3% per year.  The bus fleet plan had been based on the lower rate, but if the stronger trend prevailed, the TTC would need more buses sooner.  A new garage would be needed by 2012/13 even at the low growth rate, possibly by 2010 if the fleet grew faster than expected.

Indeed, stronger growth is exactly what arrived.  On the original projection, ridership was expected to grow from 436m to 469m between 2006 and 2011.  At the higher rate, it would reach 505m.  The actual number we now know will be about 499m.  The accelerated growth began just after the Ridership Growth Strategy (RGS) rolled out, a policy the current crop at the TTC would undo in the name of “efficiency”.

By 2010, the fleet planning had to take into account new factors including the proposed Transit City LRT lines and the Spadina extension.  Transit City was expected to displace 168 buses between 2014 and 2019, and a further 30 would be replaced by the Spadina extension in 2016.  This led to a plan in which there would be no bus purchases for several years, and the total fleet would actually shrink through attrition back to 2008 levels, well within the capacity of existing garages.

By early December 2011, the active bus fleet stands at 1,820 vehicles for a scheduled peak service of 1,520.  Requirements for 2012 and beyond will be very different depending on the service quality and ridership we assume in making fleet plans.

  • Service actually operated in 2011 was based on a budgeted ridership of only 487m, not the 499m Toronto actually achieved.  This is one reason why there are some routes already over the supposed loading “standards” — there is no budget to operate all of the service the standards would dictate.  Conversely, the planned cuts on some routes are impractical and this situation is tacitly admitted by the proposal to retain service on “busy” routes.
  • If the RGS service standards are retained, then the planned peak cutbacks on major bus routes cannot go forward.  In the short term, this can be handled with the existing fleet, but more buses will be needed (by the TTC’s projection) in fall 2013.
  • Multi-year projections in the TTC budget (see TTC Final Budget report for 2012 at Page 7) start from a base of 503m in 2012 and rise to 523m by 2015.  The base itself is less than 1% above 2011’s projected 499m, and the cumulative growth rate is about 1%.  By contrast, ridership is running over 4% above last year, and an ongoing rate of 3% should be easily attained provided that there is sufficient capacity and no economic catastrophe to drive down demand overall.

If we take 499m for 2011 and increase at 3% per annum, this would give a cumulative increase of about 12.5% to 2015.  In turn, the bus fleet would have to grow from 1820 to 2045.

The TTC has not published a detailed fleet plan including such an analysis, but this is as important to the future of Toronto’s transit as the fantasy subway plans.  The capital budget does not include any projection of funding needed to sustain strong transit growth, and the operating budget assumes a much lower rate of growth than we actually see.  The situation is very much like the one back in 2006.

Delaying or cancelling the implementation of Transit City created a crisis in the bus system’s ability to serve growing demand.  The Commission’s response is merely to cut service and ignore future problems with meaningless, low-balled projections of ridership, fleet requirements and operating costs.

Most of the transit Commissioners don’t want to entertain these debates because to do so counters the received wisdom that transit funding must be cut no matter what.  They might even have to admit that the course they advocate — of limiting the growth of service and capacity — is truly a “service cut”, certainly a reduction in the attractiveness and quality, such as it is, of the system, not merely an “efficiency”.

This type of “planning” badly serves Council and the citizens of Toronto because we don’t know what the alternatives are and the implications of various future paths.  Indeed, we risk hobbling the TTC with reduced service, fleet and staff, and creating a hole out of which a more-enlightened administration must first dig just to undo past errors.

Postscript:

In a Briefing Note to the City’s Budget Committee, the TTC advises that it is contemplating the purchase of 150 articulated buses in 2014-16.  If Council decides to retain higher service quality in 2012, the need for these buses could be accelerated.

Seven routes (not named) would convert to artic operation.  The fleet replacement ratio the TTC would use is 1.35:1.

The anticipated annual saving would be $60k/bus mainly in the labour cost of drivers.  The annualized saving with the 150-bus fleet fully in operation would be $9m.  Savings from this scheme have already been built into the multi-year budget projections.

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Holiday Service for 2011/12

As usual during the holiday period, service will operate at a reduced level because schools are closed and many people are on vacation.

On New Year’s Eve, most services will operate until about 4:00 am, and rides will be free after midnight until 4:00 am.  The last train meet at Bloor-Yonge will be at about 3:37 am (northbound, westbound and eastbound).  (The usual time for last trains is 1:54 am.)

The late night closing time for the Yonge subway north of Eglinton varies from day to day because of holiday schedules for the crews working there on tunnel repairs.

The hours of service through the holidays are summarized below.

Date      Service    Start End   YSNE
          Type                   Closes

Dec 19-23 Reduced    6:00  2:00  12:30
Dec 24    Saturday   6:00  2:00  2:00
Dec 25    Sunday     9:00  2:00  2:00
Dec 26    Holiday    6:00  2:00  2:00
Dec 27    Saturday   6:00  2:00  12:30
Dec 28-30 Reduced    6:00  2:00  12:30
Dec 31    Saturday   6:00  4:00  4:00
Jan 1     Sunday     9:00  2:00  2:00
Jan 2     Holiday    6:00  2:00  12:30
Jan 3-6   Reduced    6:00  2:00  12:30
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Service Changes for January 2012 (Update 6)

Updated December 22, 2011 at 7:00 am:

The service changes originally planned for January 2012 have been deferred until at least mid-February.  The schedules operated in November 2011 will be used for January 2012 with one exception.

511 Bathurst

A service increase to accommodate demand was planned in the original January schedules, and this will be retained.  One car will be added during various periods with headways improving as below:

PM peak:  From 5’30” to 5’00”
Weekday late evening:  From 10′ to 8′
Saturday afternoon:  From 6’15” to 5’40”
Sunday afternoon:  From 8’20” to 7’00”

Many other planned improvements to reduce crowding will not be implemented at this time.

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TTC Meeting December 14, 2011 (Updated)

This TTC meeting proved something of a surprise considering what was on the table:  a fare hike of at least a dime, maybe more, as well as widespread cuts to service on the network.  What actually happened was that Chair Karen Stintz proposed an alternative position based on the discovery of some wiggle room in the 2011 and 2012 budgets.

  • The rise in diesel fuel costs was originally projected at a higher level, $5-million worth, than what the TTC actually expects to pay based on current market trends.  Part of this money will be used to put off any service cuts to the schedule period that begins in mid-February, and the rest will be used to preserve existing service on a few “busy” routes through 2012.
  • The projected “surplus” of $12-million on the 2011 operating budget may be directed to pay, in part, for an order of new buses so that service can be maintained.  About $45m is needed both for the bus order and for yard space in which to store the vehicles.
  • Cancellation of Wheel-Trans service for dialysis patients has been put off to June 30, 2012 to give more time for development of an alternative service and/or funding sources.

The Commission also approved a 10-cent fare increase for January 1, 2012 and, in principle, similar increases at the beginning of years 2013 through 2015.

TTC Announcement

The deferral of service cuts to February will allow the whole matter to be debated at Council (where it should have been in the first place) so that a decision can be made there on any possible increase to the TTC’s operating subsidy and the broader questions of future service quality.  Meanwhile, TTC staff will put together a proposal for which routes are busy enough to warrant continuing service at 2011 levels through 2012.

This is a strange turn of events.  Quite recently, staff proposed cuts based on loading standards that, if they were already being observed, would mean that buses had room for more riders.  In practice, service on the street is not as good as staff claims, especially when allowance is made for the gap between the advertised frequency and reliability on the schedule and real life operation.  Between the riding counts used to justify cuts in May 2011 and the tacit admission that plans for 2012 service cuts were ill-considered, the credibility of TTC Service Planning in reporting actual conditions leaves much to be desired.

If we cannot count on staff information to be accurate, how can anyone make intelligent policy decisions?  This is a problem throughout the City’s 2012 budget process where information comes out only because Councillors who are not in the Ford camp pursue the details.

Commissioner Maria Augimeri screened a video of conditions on the Finch West bus.  The first bus coming by does not even stop because the operator doesn’t think he can fit any more people on.  If you pause the video, you will see that there appears to be space on board, but the bus is crowded at the front, and that’s what the operator bases his opinion on.  So much for “room at the back”.  This type of pass-up is reportedly quite common.  The next bus is very crowded, and we view the ride from the front vestibule where, strictly speaking, there should be no passengers.

Many people representing a wide variety of communities and backgrounds urged that the TTC not raise fares and cut service.

One speaker challenged the TTC and members of Council to “walk in their shoes” and take the TTC for a week.  Several Commissioners declined, while a few noted that they are already on the TTC.  Oddly enough, Commissioner Crisanti, a Ford loyalist from Rexdale who is normally rather out of touch on TTC matters, took an interest in this deputation, probably because the group behind the video is from his ward.

There was a bit, but not much, open harrassment of public speakers by members of the Commission unlike the way the Budget Committee treated the hundreds who spoke there over two days.  That’s just as well.  Insulting the public would only further undermine the dwindling credibility of the commissioners.

Transit City came up frequently in the deputations.  Unlike previous occasions, speakers were not stopped from addressing this topic because the Chair cannot claim that cancellation of the LRT network and the overall quality of the TTC are not linked.  We have billions for Eglinton and Sheppard tunneling, little of which will co me from the private sector, but we don’t have money to operate the basic transit services.  Hoped-for improvements, notably on Finch West, won’t happen because the LRT line was cancelled, and the TTC has no buses or budget headroom for service improvements, let along the capital cost of any transit priority scheme.

Councillor Joe Mihevc, former Vice-Chair of the TTC in the Miller administration, proposed that Council should vote for the original Transit City plan with Eglinton underground only from Black Creek to Brentcliffe, and that all work on the Sheppard subway scheme should stop.  This was, of course, ignored by the Commission, but the idea shows where Council’s left is headed going into 2012.

Word on the street has Queen’s Park just waiting for Council to actually take a position on Toronto’s transit plans, a vote that has never been held even though the Mayor committed to getting Council approval for his agreement with Premier McGuinty.  The open statement from Ford’s consultant, Gordon Chong, that the Sheppard line will attract at best 30% private sector financing, leaves the Sheppard proposal in ruins.  If such a vote reaches the floor of Council, will enough of the “mushy middle” tell Rob Ford to take his plans and get lost, and affirm Council’s commitment to proposals much closer to Transit City?

In other news, the Humber Bay bus issue was put over to February’s meeting so that consultations with the neighbourhood can take place.

There was no supplementary agenda, and the issue of TTC relations with Metrolinx and the status of the Eglinton-Crosstown line was put off to January’s meeting.

The original post previewing the meeting from December 11 follows below.

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TTC Ridership and “Surplus” Continue to Rise

Ridership projections for the TTC continue to climb with the year-end total now projected at 499-million, up 2-million from an estimate only one month ago.  The TTC’s “surplus” (actually a decrease in the projected subsidy level from the original budget) is also growing thanks to higher fare revenue and cuts in projected spending for the remainder of 2011.

The details are included in the Chief General Manager’s report covering the system’s operation up to the end of October 2011, but with year-end projections based on more recent experience.

With discussions of the TTC’s 2012 budget still swirling at City Hall, the update to projected 2011 figures raises questions about just how much money the TTC actually needs to balance its books and how much service will actually be required in the new year.

Comparing 2011 projections as they appear in the current report and in the November 23 version, we can see where the year-end estimates have changed.

2011.12.08 CGM Comparison

Revenue from fares is projected at $3.4m more than in the November estimate.  Although there will be 2m more rides, some of the increase reflects travel by passholders that contributes no marginal revenue.

Overall ridership is running at 4.9% over 2010, almost 2% higher than the commonly used 3% rate in many projections.

On the expense side of the ledger, some projected costs have fallen.  The saving from “gapping” (leaving vacant positions open longer than planned in the budget) is up by $0.7m, and other reductions will save $1.8m.  The one-time cost of Corporate Restructuring (downsizing ) is now estimated at $3.0m less than expected.  This gives a total reduction in expenses of $5.5m compared to the November estimate.

The combined effect is that the projected “surplus” is now about $9m greater than the November estimate.  Whether this has been included in the City’s budget projection of the overall corporate surplus is unclear given that these number have only just been published.  (Of course, this is not a true “surplus”, but an underspending against the original budget.  However, some of the budgeted “revenue” comes from reserves, and underspending reduces the draw from that source leaving more money in the pot for future years.)

Looking at any financial statements, it is important to distinguish between one-time costs and the ongoing expenses of an organization.  Because only the variations to budget are reported, we can only see the budget lines where these occur, but it’s worth noting that if the net effect of one-time items is eliminated, the surplus would be about $7m higher.  Some of these items are non-cash bookkeeping entries that cancel each other out, but the cost of downsizing TTC staff is a real cost that applies only to 2011.

The proposed 2012 budget includes a 10-cent fare increase to adult tokens and to senior/student tickets with roughly proportional changes to other types of fare (see page 11 of the linked report).  TTC staff have been asked by the City’s Budget Committee to report on an option for a 15-cent fare increase that would generate enough additional revenue to reverse the proposed January 2012 service cuts.  This analysis will likely appear before the TTC Commission meets on December 14, and I will update this post when the report is available.

Based on recent strength in ridership, the TTC now projects that 2012 riding may reach 507-million rather than the originally estimated 503m.  This pushes the revenue estimate for 2012 by $5m.  However, if the actual 2012 results come in at 499m, even at 507m the 2012 ridership would only be up by 1.6% showing the combined effect of demand growth and riding lost to the fare increase and service cuts.  If service is retained at the current loading standards and if the fare increase has no effect on riding (as happened when the TTC raised fares by 25-cents in 2010), then ridership could grow by 3% or more taking us to at least 514m in 2012.

This has major implications for service planning next year and beyond.  TTC staff project that at the 507m level, $1-2m worth of additional service will be required in September 2012.

Multi-year projections in the budget report are already falling behind likely ridership levels.  Without a fare increase (or equivalently with no drop-off in demand caused by higher fares), the TTC projects 2013 ridership at 515m or only 3.2% above the projected 2011 total.  To 2015, the projection is 536m or 7.4% above 2011.  If the presumed effect of higher fares is included, the 2015 figure is even lower at 523m.  These are very conservative estimates, and all of them include the effect of service standards cuts that may not actually take effect.

If ridership were to grow at 3% compounded from 2012 through 2015, the TTC would reach about 562m rides in four years’ time.  That’s a lot of additional riding and service, and it would be borne by the existing system as no rapid transit expansion is planned until mid 2015 at the earliest (the Spadina extension).

Although the TTC does provide pro-forma budget estimates for 2013-15, these are based on conservative assumptions and do not provide a broader view of the decisions and options facing the transit system in coming years.  Whether such a discussion would be welcomed at City Hall is anybody’s guess — more spending on transit is probably the last thing the right wing of Council and the Mayor want to hear about.  However, this puts calls for much improved subsidies both from the City and Queen’s Park in the spotlight.

Anyone who may call for higher subsidies really needs to understand where transit in Toronto could be headed.  If we ask for more money based on too-conservative estimates, we will be right back at a point where funding seems inadequate, never catching up to actual demand.  Even worse, if that funding is used primarily to flat-line fares, the crunch on service will tighten and transit will be even more inconvenient relative to driving.

Debates about the future of transit cannot be put off indefinitely with the claim that we can’t afford to improve the system (except for the odd multi-billion dollar subway scheme).  The pressure for more capacity in our transportation network won’t vanish simply through political rhetoric.

TTC budget debates continue to focus on one-year views, on shuffling a few millions here and there on a table where billions are at stake, on scoring political points against competing views of what transit should be.  That’s no way to serve the riders, the citizens of Toronto.