Finance

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Just Raise Taxes

The ongoing debate about trasnsit funding produced a few rather strange proposals recently.

On April 1, writing in Metro, John Sewell suggested that the “crybabies on Council” who think Transit City is so important should just raise property taxes by $500 per house to generate $400-million/year.  This is a ridiculous proposal for many reasons, notably that a jump of that magnitude would not be politically saleable to anyone on Council.  This year’s increase is far, far lower, and even that produced howls of outrage from those who claim the city taxes too much already.

If taxes were raised enough across the board to generate $400m, that would be a 14% increase.  I can hear the Board of Trade screaming now about how uncompetitive Toronto would be.  If the whole load goes on the backs of the residential taxpayers, the percentage increase would be much higher.

Sewell, of course, is setting up a phony argument here by saying Toronto taxes are so low relative to those in the GTA, and if only we would raise them to the average, we would have all the money we need.  Does he honestly think voters would tolerate such a change?  If he were still mayor, would he run on that platform? Continue reading →

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TTC E-Initiatives Update (Revision 2)

Revised April 6 at 7:00 am:  A short section has been added about Google Maps.

Revised April 5 at 10:00 pm:  A section has been added at the end covering those e-initiatives which were not included in the discussion at the TTC.

On March 24, 2010, the Transit Commission received an update from staff on the status of various initiatives broadly relating to the use of information technology.  These include:

Internet Trip Planner (ITP)
Next Vehicle Arrival System (NVAS)
Customer Service Disruption Notification (CSDN)
Narrowcasting
Next Train Arrival System (NTAS)

This article gives a summary of that presentation and a few of my own comments on these and other related matters.

Continue reading →

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Analysis of 512 St. Clair for Jan-Feb 2010 (Part 1: Headways)

In the previous series of four articles about the St. Clair car, I review operations in January 2010.  Quite noticeable within the data for January was a change in line management style in the last week of the month with a more regular pattern of short turns and generally more reliable service.

On February 14, the TTC implemented new schedules with longer running times in an attempt to overcome problems with the original versions.  Headway reliability on weekdays improved slightly, although the largest change had already come with the new line management scheme.  On weekends, although the worst of the bunching and gapping was reduced, there continued to be wide variation in vehicle spacing suggesting that the level of management necessary to ensure reliable service was not present.

I have now received February 2010 data for the St. Clair route, and this series of articles will review what it shows about the effect of the new schedules on various aspects of the operation.  Here I will review headways at key points, and in future articles I will look at link times, general line management and intersection delays.

Continue reading →

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Service Changes Effective May 9, 2010

Construction diversions on several routes will begin or continue in May.

504 King and 508 Lake Shore: 

King cars will continue turning back at Roncesvalles and Queen, but will reach there via Shaw and Queen Streets.  Watermain construction which last year caused Roncesvalles to be torn up last year moves to King between Ronces and Jameson.

The 504 shuttle bus will be rerouted and extended to run between Shaw and Dundas West Station bothways via Roncesvalles looping via Strachan, Douro and Shaw.

No date has been set yet for resumption of streetcar service on Roncesvalles, but this is expected to be in the late fall.  The diversion via Queen and Shaw is expected to last to the end of August 2010.

502 Downtowner and 503 Kingston Road Tripper

The reconstruction of Bingham Loop, deferred from 2009, will occur this summer.  Buses will replace streetcars over both routes until mid-August.

Replacement bus services will loop via Victoria Park, Meadow and Blantyre to Kingston Road.  The peak service on both routes will be improved from 7’30” to 6’00”, but offpeak service on the 502 will remain at 20′.

22 Coxwell and 70 O’Connor

Reconstruction of the bus loop at Coxwell station requires the removal of all bus service.  Routes 22 and 70 will interline, and all of the “O’Connor” service will run through to Queen or to Victoria Park depending on the time of day.

Existing interlines between the O’Connor, Gerrard and McCowan routes will be discontinued during this period.

72 Pape

Construction at Pape Station requires that the Pape bus be rerouted to loop at Donlands Station.  Passengers transferring to this route from the subway at Pape will do so using on street stops.  This diversion will last until the end of 2010.

The seasonal extension to Cherry Beach will operate during the evenings Monday to Friday, and all day on weekends and holidays.  This will run until Labour Day.

512 St. Clair

The mixed streetcar and bus operation on St. Clair is expected to last until the latter part of June 2010 at which point the TTC hopes to restore streetcar service to Gunn’s Loop.

509 Harbourfront and 510 Spadina

The seasonal fare collection scheme on Queen’s Quay will be in effect until Labour Day.  No fares will be collected eastbound on Queen’s Quay between Bathurst and Union Station on weekends after 3 pm, and there will be collectors stationed in the tunnel linking the Union Station Loop to the subway.

One PCC car will operate on the Harbourfront route on Sundays until September 5, 2010 between 1130 and 1930.  This will run as an extra, and will be subject to availability of both a car and an operator.

Seasonal Route Extensions

  • 72 Pape to Cherry Beach (see above)
  • 28 Davisville to the Brick Works
  • 29 Dufferin to Ontario Place (service south of Dufferin Loop will be split between the 29B Ontario Place and 29D Princes Gate branches)
  • 86 Scarborough to the Zoo
  • 85 Sheppard East to the Zoo
  • 510 Spadina King short turn extended to Queen’s Quay on weekends
  • 165 Weston Road North to Wonderland

Other Route Changes

  • 25 Don Mills service north of Steeles removed (York Region request)
  • 29 Dufferin trial service in Exhibition Place rerouted to operate via Manitoba Drive, Canada Drive, Princes’ Blvd., Nunavut Rd., and Nova Scotia Ave to Manitoba Drive.
  • 224 Victoria Park North service extended to Elgin Mills (York Region request)
  • 96B Wilson route changed via Claireville Drive
  • 96C Wilson service removed from Thistledown Blvd. early mornings and late evenings

Service Level Changes

Many route have new schedules starting on May 9 primarily for seasonal changes in demand.  The details are in a spreadsheet linked below.

2010.05 Service Changes

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Time For Metrolinx To Earn Its Keep

A few days ago, Queen’s Park dropped a bombshell on local and regional transit plans by announcing the deferral of $4-billion of previously announced support for transit construction.  Details were left for Metrolinx to work out.

Pity poor Metrolinx, and its Board who are about to embark on their annual retreat.  This will be no wine and canapés in the woods outing, but some very hard slogging for “Metrolinx II”.  This is a Board that did not work through the creation of The Big Move, and many members are short on local planning and political experience.  All the same, it’s their job to sort out what is to be done.

I’m not a Metrolinx Board member.  I wasn’t even on their Advisory Panel.  But if I were, here’s the advice I would give.

Metrolinx is stuck in a policy vacuum.  Queen’s Park claims it has not lost interest in transit, merely that it wants to hold off a while to get the financial house in better order and concentrate on portfolios more demanding of short-term spending.  We have to take them at their word, but this doesn’t really tell us what support for transit will look like whenever it will materialize.

Any program that assumes one specific level of support is doomed to irrelevance on two counts:

  • If spending priorities change for any reason, the program will be out-of-step with available funding and we will be back to the familiar position of waiting for yet another proposal while the clock ticks away.
  • A single program without alternatives includes many assumptions and tradeoffs that may be hidden in private discussions, and which preclude vital public debate on what role transit should have and how it will be financed.

Queen’s Park has announced that it will produce a 10-year fiscal plan in 2011.  That plan necessarily will include (or omit) whatever funding for transit, including Metrolinx projects, that will take us to the next decade.  Metrolinx’ job is not to produce one scenario, but a range of options that can inform the creation of that plan.

For obvious political reasons (the coming provincial election), debate on these options may happen in private, and that would be quite sad.  The future of the GTA’s transit network is far too complex and far-reaching to appear as a fait accompli by way of a pre-election announcement next year.  Moreover, if the Liberals were to lose power, a single program embedded in an election platform would almost certainly be discarded as a product of the ancien régime.  You need only look to the treatment accorded David Miller’s Transit City to see what the future might do to a Liberal transit plan.

Here, Board members, are your assignments. Continue reading →

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What Is Ontario’s Transit Future?

Memo to Dalton McGuinty, Dwight Duncan and Kathleen Wynne:

Queen’s Park makes much of its forward-looking plans for transit, of its commitment to improving travel in the GTA, of its recognition that without more and better transportation, the GTA faces economic strangulation.  Many of the press releases and flattering photos remain available on the Premier’s website.

Now your budget tells the GTA that transit must wait, and begs the questions “how long” and “for what”.  You owe the people who supported your transit vision answers.

Do you still believe in transit?  Do you mean only to defer Metrolinx projects beyond the current financial crunch to smoothe the growth in provincial debt, or has “The Big Move” gone the way of so many other grand schemes for transit networks?  Will you ever return to funding local transit system operations, or are these at the mercy of priorities and financial pressures of municipal governments?

When you announced MoveOntario 2020, you trumpeted the importance of transit to the economic engine that is the GTA.  What has changed?  Do you think a few years’ delay won’t hurt too much?  What happens if years turn into decades?

Is a real commitment to transit too rich for your taste?  Do you worry that transit agencies at all levels lowball their project estimates and overspend at every opportunity?  Do you feel transit cannot compentently be delivered at either the municipal or provincial level?

How do you explain wasteful spending on a subway to Vaughan?  How do you explain discrepancies between the scale of infrastructure spending and demand projections in the Georgetown corridor and the actual claims of your own agency about likely future service?  How do you explain a farecard project whose cost projections have tripled and which shows no sign of implementation?

Will you engage GTA residents with an open discussion of the future of their transportation systems, or will you hide behind a secretive agency, unwilling to face hard decisions about transit funding?

Anyone can take the easy route.  Blame the economy for the current crisis, and seize the opportunity to rethink commitments.  Let the ham-fisted incompetence of one local project, St. Clair, tar the credibility of transit plans generally.  Say this is just a chance to take a breather in the race to better transit, that we’re not quitting the field.

What do you say to the growing population of the GTA, population that will swell whether you fund more transit construction or not?  What do you say to those who knew traffic congestion would always be with us, but thought its growth would be muted as much travel diverted from cars to transit lines?  How many photo ops with twirling windmills will you need to offset delays or cancellations in transit projects?

Ontario talks about its planned attack on the deficit, about its goals for better education systems and health care, but it is silent on the transit portfolio.  Where is the multi-year plan?  What has happened even to the “top 15” projects, let alone “The Big Move”?

You owe us an explanation, and you owe it to us now.

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Move Ontario 2030?

Today’s Ontario Budget announced that as part of Expenditure Management, spending on Metrolinx projects will be delayed and a program that funded bus replacements will be cancelled.

In the current fiscal environment, the government has revised the scope and timing of some capital investments. To help manage infrastructure spending over the coming years, the government will:

  • Work with Metrolinx to phase construction of transit projects, which would result in approximately $4 billion in appropriation savings and reduced borrowing over the next five years
  • Eliminate the Ontario Bus Replacement Program and include bus replacement costs as eligible expenses under the gas tax funding program, which supports municipal transit. The government acknowledges that municipalities have current commitments under the Ontario Bus Replacement Program, and will work with them to ensure these commitments are met by providing one-time funding of almost $174 million in 2009-10.

This will specifically delay work on all Transit City projects as well as VIVA’s BRT network.  Over the next few months, Metrolinx will have to figure out a new project list.  The 15 and 25 year plans of “The Big Move” are now in tatters.

I can read the events pessimistically in the sense that the hoped-for level of transit funding will never occur.  Certainly major expansion is on the back burner, and there is no announced funding to support operating costs of local transit systems.  Alternately, an optimistic view is that the approach is “not now” because the revenue needed to fund transit growth demands some new form of taxation, and with an election in 2011, nobody at Queen’s Park wants to address the issue.

Sadly, I tend to be a pessimist based on past experience.  Jobs, health care and education are portfolios that touch all parts of Ontario, while transit is Toronto-centric.  Only when the economy is booming, or appears to be as it was only a few years ago, can Queen’s Park afford to announce large-scale spending in a new area.  Now, Queen’s Park has not just capped its commitments, it has retrenched.

According to the Globe and Mail,

The government is asking Metrolinx, its regional transportation agency, to submit a proposal phasing in the projects for a total of $4-billion in savings over five years, starting in 2010-2011. An official said it would take a few months for the government to decide which projects will be delayed.

That $4-billion is almost half of the previously announced $9.6-billion commitment to Metrolinx projects, and quite serious cuts or deferals will be needed to achieve this level of saving.

Almost certainly, the Finch LRT line will be delayed and cut back in scope.  The proposed section from Yonge to Don Mills and Sheppard, added to the project by Queen’s Park, never made sense and is an easy casualty.  However, the western end of the line may also be truncated at Finch West Station (Keele and Finch) if it is built at all.  This would leave open the whole question of how a northern “crosstown” route would be created either on Finch, or via a western extension of the Sheppard Subway to Downsview.  Whatever the choice, there’s no money to build it today.

The Scarborough RT has already been announced as cutting back to Sheppard rather than continuing to Malvern.  The challenge here is that the RT itself is wearing out and may not survive until 2015 when it is supposed to be an integral part of the Pan Am Games transit service.

The Sheppard LRT is already under construction, and this project is likely safe because of its location in the network sharing infrastructure with the SRT.

The Eglinton LRT, most expensive of all Transit City projects, is the easiest to defer while producing large scale budget savings.  No substantive work has been done yet, and even if it stayed on schedule, the airport connection (a holy grail of Pan Am Games supporters) would not be ready for 2015.  No doubt, the technology debates for this route will continue to rage in political, professional and blogging circles.

Other parts of Transit City are much less advanced in planning, and these may simply fall off the table without a strong advocate at the city level.  Jane does not make sense without at least one of Finch or Eglinton that would share a carhouse.  Don Mills would connect with Sheppard, but the combined fleets required for Sheppard, the SRT and Don Mills would probably exceed the capacity at Conlins Road Carhouse.  Scarborough/Malvern only makes sense if there is an aggressive plan to increase population density in the corridor.  In effect, only a Scarborough subnetwork of Transit City may remain.

Subway advocates have little to cheer for in this announcement.  The Transit City funding that some would redirect to subway construction is unlikely to reappear, and very expensive projects such as the Downtown Relief Line and Richmond Hill extension will have to fight hard for capital.

Waterfront West, that poor orphan of the Transit City network, is almost certainly dead at this point, and I wouldn’t hold my breath waiting for the Bremner Boulevard streetcar either.

Lurking in the background of this mess is the question of transit financing.  When Metrolinx was created, we heard bold statements about an “investment strategy” that would create transit lines out of thin air with no provincial exposure to debt costs until future decades.  The accounting sounded like a Wall Street Ponzi scheme even then, and it’s clear now that building a huge transit network on the never-never was simply not workable.

The original Metrolinx board, mainly politicians from the GTA governments, became restive about financing not just for their bold plans, but for the local network improvements that would be essential as feeders to the regional network.  For their troubles, they were dumped and replaced by a gaggle of private sector experts whose main public contribution thus far has been to sit meekly at Board meetings and rubber stamp whatever reports are placed in front of them.  If they are making some miraculous contribution to the future of GTA transit, it is invisible.  The Board will head off for its annual retreat next week, and it might well consider how to make itself and its “Big Move” relevant.

The single most important part of any transit plan is the money to build it.  This comes either from existing income streams (unlikely given that they’re all spoken for and the government is in deficit) or from some new levy.  The opponents of new taxes will rail against government waste all they like, but the real truth is that major new programs like this are not affordable unless someone pays for them.

Private sector “partnerships” are nothing more than accounting sleight-of-hand.  Money must still be spent to build lines, and more money must be found to operate them.  At the end of the day, we the riders and taxpayers pay the cost.  One may argue about the relative efficiency of private and public sector project delivery, but even the most optimistic savings on that account won’t come near bridging the gap between project costs and available funding.

Some argue that “transferring risk” to the private sector will make them sharpen their pencils and deliver projects on better schedules and at lower cost.  Sadly, the private sector hates risk and has two basic approaches to it:

  • boost the contingency in their pricing to allow for the risk they must assume, or
  • be prepared to walk away from their contract if the penalties for non-performance wipe out any hoped-for profit (in effect limiting the “risk” to the sunk investment)

One mayoral candidate has raised the issue of road tolls suggesting a $5 fee for using Toronto’s DVP and Gardiner Expressways with the money going to fund a large subway network.  Leaving aside whether I agree with that network, there are larger issues here:

  • Any road toll must exist on the entire expressway network, not just the “Toronto” component.  This brings in the 400-series highways that are under Queen’s Park’s control.
  • Tolling will drive some traffic onto local streets making local gridlock even worse than it is now.
  • If motorists are to bear the cost of transit expansion, why should this only be applied to expressway users?  What about a regional premium in gas tax?
  • Why should the cost only be borne by motorists?  What about a regional sales tax?
  • Will transit operations continued to be funded from local property taxes, or will new transit revenue streams such as sales tax be shared between operating and capital budgets?

The existing Ontario Bus Replacement program is itself “replaced” with “eligibility” to use gas tax revenue.  This sounds good, but in fact the annual gas tax revenue to Toronto (less than $75-million from Queen’s Park) is less than one quarter of the ongoing capital spending for the existing TTC system.  There is no “spare” gas tax money available to replace the roughly $10-million annually the TTC expected to receive from OBRP.

For comic relief, read about MoveOntario 2020 on the Premier’s website.  It is a product of a very different time.

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Transit 102: What is “Good Service”? (Updated)

Updated March 23 at 11:20 pm:  After this article was published, one commenter noted that the cleanliness and attractiveness of the system is another vital aspect of “good service”.  In my article, I had concentrated literally on “service”, not on the physical condition of vehicles and stations.  However, I do agree that a run-down, dirty system does not inspire confidence, and the TTC is looking decidedly shabby.

Tess Kalinowski has an article in the Star on the issue of station condition on the south end of Yonge Street where the BIA is doing a running audit to track progress on fixes.  The TTC has its own internal monitoring, and loves to trumpet improvements as a good news story, but the truth is that there is backlog of repairs that gets longer by the day.  This topic is worth a post in its own right, but I wanted to add the link to the Star’s article here as it fits right in with the comment.

In all the talk about who should run the TTC, or whether transit should even be provided by the public sector, one important question is rarely answered. What sort of transit service do we as a city want? What is “good” service?

“Good” is a relative term depending on your viewpoint. If your job is wrestling with municipal or provincial budgets, your outlook will be to restrain growth in costs and to limit expectations of service quality. This runs head on into schemes to redirect growth in travel from autos to transit. More passengers almost always mean more subsidies over and above any inflationary growth.

If you are a transit rider (or thinking of becoming one), you don’t want service that is barely acceptable. You want service that retains your loyalty and that you would recommend to others. Riding should grow because transit attracts customers, not as the “least worst” of options.

There are three essentials in transit service: reliability, frequency and connectivity.

Continue reading →

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Found Millions

Toronto’s media are abuzz with news and criticism of the City’s discovery that the 2009 operating budget surplus was $100-million higher than previously expected.

This all began with a media advisory Tuesday night that there would be an important announcement the following morning.  Don’t be left out in the dark.  Get there early with your cameras for the best position!  The next twelve hours brought rampant speculation about Mayor Miller resigning to take a job elsewhere, about a reversal of his decision not to stand for a third term, or just about anything else the pundits could spin to fill air time, print columns or websites.

The announcement was an anti-climax after the buildup.  Commentary switched to “why didn’t you know sooner” and variations on how the Miller crew had been misleading the public about the severity of Toronto’s financial position.  Lost in all of this chest-beating was the fact that this surplus is a windfall, a one-time benefit of circumstances coming out better in 2009 than expected.  Many of the savings that produced the surplus have already been factored into the 2010 budget, and we cannot expect a repeat performance — a $350-million surplus overall — in future years.

That’s where the TTC comes in.  For 2010, the City will provide all of its operating subsidy, roughly $440-million, and not a penny will come from Queen’s Park.  The total operating budget is about $1.4-billion, and if it rises as projected by 5% or so in 2011 (through a combination of wage and service increases), this will add $70-million.  Oddly enough, this is almost exactly the amount of the proposed tax stabilization reserve that would carry forward into 2011.

Mayor Miller claims that we could see a 2011 with no fare increase, a 3% property tax jump and a balanced budget.  The kicker is that he assumes he will be able to conclude an agreement with Queen’s Park for the resumption of shared operating subsidies in 2011.  The response was predictable given that this is an “ask” of about $250-million for 2011 before the province has even published its budget for 2010.  I was rather surprised that Miller spoke as if this were a done deal when, if we are to believe Queen’s Park, it is at best still under discussion, and the question of a partial or complete TTC takeover by Metrolinx is still bouncing around the rumour mill.

Regardless of whether the province steps in with operating subsidies, my position on this situation is quite clear.

First, we should not prejudge the use of surplus money from 2009 in the 2011 budget.  Over and over politicians and advocates who support transit speak of the importance of good transit service.  Fare freezes make good pre-election sound bites, but they don’t address the issue of providing better transit service.

Second, this is one-time money, not an ongoing revenue source.  If we use $70-million to freeze fares in 2011, that amount will have to be found anew in 2012 in addition to another $70-million to handle that year’s cost increases.  That’s a prime recipe for big jumps in fares and cutbacks in service, especially if the City is governed by a less transit-supportive Council and Queen’s Park hasn’t stepped in to help out with TTC costs.

Yes, there may be ways to increase the effectiveness of transit spending.  I don’t want to get into a big debate here about everything from wage controls to outsourcing or breaking up the TTC.  These are, to an extent, red herrings in the long term because they will at best achieve a temporary drop in cost pressures.  Eventually, costs will reach a new plateau from which they will grow and we will be back to the same debates about fares, subsidies and service levels. 

We should have these debates, if only to satisfy ourselves of the validity (or not) of alternative ways to provide transit in Toronto, but the long term issue of rising transit costs will not go away, particularly if we expect large-scale increase in transit use throughout the GTA.  The underlying policy issue, however, is what we expect our transit network to accomplish, and what the failure to improve transit’s market share means for the future of the region.

Meanwhile, Toronto must concentrate on maintaining and improving the attractiveness of transit, and anything that artificially hides the ongoing increase in costs simply threatens transit in future years when the increases must be faced.  The 2009 surplus should be seen for what it is, a one-time benefit to a city that tightened its belt and came through the year in better shape than expected.  Toronto should not prejudge transit policies for 2011 and beyond based on a one year windfall and an as-yet unseen provincial funding agreement.