TTC 2023 Operating Budget

This article is a deeper dive into the budget for 2023 following up from my first cut on the subject yesterday (January 4).

See:

Updated January 6, 2023 at 2:10pm: Of all the tables included in this article, I realized that I had not included the full budgets showing functional breakdowns, as opposed to individual line items. These have been added at the end.

The annual budget cycle is always a challenge because the document comes to the TTC Board at the last minute before it must be passed and forwarded to Council. This year, the situation was complicated by the election (normally we would see the budget reports in December, not January), and by the new “strong mayor” system in which the Mayor effectively dictates the budget by setting the City’s proposed subsidy ceiling. We have many new Board members most of whom have no experience with TTC budgets, and who will not know “which rocks to look under”.

Even worse, the Mayor’s press conference announcing the budget made no mention of planned service cuts coming in Spring 2023 and gave the impression that this “core service” was defended. That can, at best, be called “misdirection” in the hope that nobody would notice what was happening and focus on the “good news”.

Here, in much more detail than I had time for in the first article, is the budget information distilled from the TTC’s 55-page report.

Key points (the TL/DR version):

  • The City will give the TTC $53 million more in subsidy in 2023 than 2022. This is pitched as being in support of more security, safety and cleanliness on the system, although the cost of those changes is less than 10% of that amount.
  • The same argument is advanced for proceeds from a fare increase (10 cents on single fares for adults and youth/students) projected at roughly $16 million.
  • The effect is that new funding is advertised for a politically unassailable purpose even though it will mainly pay for other aspects of TTC operations.
  • The year-over-year increase in City subsidy is lower than in some past years and should not be seen as a generous windfall. This is in part possible because of underspending in 2022 which leaves headroom for 2023 without as much additional City money as would otherwise be required.
  • The cost of beginning operations on Lines 5 and 6 will eat up over $40 million in 2023 and even more in 2024. At the same time, the TTC proposes service cuts elsewhere that will save about $46 million nominally in the name of matching service to demand. What is actually happening is that most of the network is paying for two new rapid transit lines through service cuts.
  • Crowding standards for off-peak service will be substantially changed to permit more riders on buses, streetcars and subway trains. On buses, the off-peak standard will be only slightly less than the peak standard. Combined with chronic unreliability of service, this will lead to more full buses and will discourage riding during the period when recovery to pre-pandemic levels is strong.
  • Headway maxima will be raised so that rapid transit service could operate as infrequently as every 10 minutes during periods of light demand. For buses and streetcars, there is no guarantee that the existing Ten Minute Network will be preserved.
  • The changes to Service Standards (crowding and maximum headways) are not explicitly listed in the report’s recommendations and would be missed by someone only browsing early pages, a not unusual situation for TTC Board members and Councillors.
  • The TTC has not published any details of planned service changes even though, for April 2023 implementation, they are certainly in the early stages of planning. The TTC and Council were clearly expected to approve the changes sight-unseen, possibly without even realizing they were buried in the budget. TTC management must be forced to reveal the details of what they plan.
  • The budget provides for additional operators who will be used to fill open crews to reduce or eliminate the incidence of service gaps caused by missing buses and streetcars. This is a change and improvement from using “run as directed” vehicles to the extent that operators are available to drive them.
  • Even this austerity service is possible only with additional subsidy of $336 million which the City/TTC will seek from the provincial and federal governments.
  • Ridership recovery is stronger on weekends, and among concession fare groups (seniors, youth, students). This type of riding is less affected by work-from-home.
  • Projections for future budgets in 2024 and 2025 include no provision for additional service beyond that which will be operated in 2023.
  • The TTC claims it will pursue a ridership recovery program, but its budgetary plans suggest that service will remain below 2022 levels for 2023 through 2025. This, coupled with chronic service reliability problems, is not a recipe for winning back riders.
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Tracking Metrolinx Project Costs

The Province of Ontario is not exactly transparent when it comes to reconciliation of announced project costs and actual spending, let along the changes that might occur along the way. A project, or group of projects, might be announced with a value in then-current dollars, and without necessarily including all future contract costs. There are various reasons behind this approach including:

  • The government does not want to tip its hand on the amount of money “on the table” to prospective bidders who might tailor their bid to the perceived level of funding.
  • Some contracts include future operating and maintenance costs as well as capital costs. In some case the announced cost does not include the O&M component, only the estimated capital portion.
  • Provincial projects are typically quoted in then-current dollars with future inflation to be added as it occurs, at least to the point where there is a contract in place which includes that provision.

This approach hides the likely as-spent costs and makes provincially run projects appear cheaper, at least in the short run.

This is fundamentally different from the way the City of Toronto tracks projects and how TTC requirements are reported. Specifically:

  • City project cost estimates include inflation to completion because this is factored into future funding requirements.
  • City projects do not bundle future operating costs with capital, but report them separately.

Note that cost estimates shown in the Infrastructure Ontario market reports do not necessarily match values shown by Metrolinx because IO shows these values on a different basis. Future operating and financing costs are no longer included in IO estimates so that a project’s value reflects only design and construction costs, a value that gives potential construction bidders a general size of the project’s scope.

Infrastructure Ontario notes on the November 2022 Market Update that we have modified the methodology used to calculate the estimated costs as presented on the chart. In May 2022, and for Market Updates prior to that, we used the Estimated Total Capital Costs. For the latest update, and going forward, the costs listed only include Design and Construction costs.

These changes were adopted after feedback from our construction industry partners found that including only design and construction costs provided them with a better sense of the scope of the project and would assist in determining if they wished to participate in the bidding process.

Email from Ian McConachie, Infrastructure Ontario, Manager, Media Relations & Communications, November 24, 2022.

This can be confusing with “bundled” projects such as the Ontario Line RSSOM contract which includes both provision/construction of vehicles and infrastructure, as well as future O&M costs. This is probably the reason, or a good chunk of it, for the very large increase in the RSSOM contract value between the initial estimate cited by IO and the contract award. However, the way these contracts are handled generally makes it impossible to know how much of the change is simply due to inflation in materials and labour costs, and how much is due to underestimates or scope changes.

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Eglinton Crosstown Delayed (Again)

In what must be the most anti-climactic news on the planet, Phil Verster, Metrolinx President and CEO, has announced that the Eglinton Crosstown Line 5 will not open as planned. I will let Metrolinx speak for themselves.

Statement regarding the Eglinton Crosstown LRT

Sept. 23, 2022

Today, Metrolinx President & CEO Phil Verster issued the following statement:

We had expected the Eglinton Crosstown LRT to be fully built, thoroughly tested, and in service this fall in accordance with our project agreement with Crosslinx Transit Solutions, the construction consortium responsible for building the project.

Unfortunately, while progress has been made, Crosslinx Transit Solutions have fallen behind schedule, are unable to finalize construction and testing, and therefore the system will not be operational on this timeline.

We know construction has been difficult for commuters, communities, and businesses along the Eglinton corridor. We are doing everything to hold Crosslinx Transit Solutions accountable and to redouble efforts to meet their commitments and complete the work quickly so we can welcome riders onto a complete, tested, and fully operational Eglinton Crosstown LRT as soon as possible.

Source: Metrolinx Blog

Anyone who has followed the construction project, to the degree it is visible at street level, would have trouble believing the line would be ready in 2022. Only a week ago, the project’s Twitter account announced that they had just finished structural steel at Eglinton Station. This is nowhere near the same as putting the last touch of paint on a building.

The TTC budgeted for a first quarter 2023 startup with training in advance, but that date sounds iffy considering Verster made no mention of a handover date from the builder, let along commissioning and opening the line.

If only Metrolinx were less secretive, less inclined to give us only “good news”, there would be more trust in their breathless announcements for all projects, not just Eglinton.

The key question, however, is not “when will it open”, but “how long has Metrolinx known”.

TTC Board Meeting: July 14, 2022

The TTC Board held its last scheduled meeting of the current term on July 14. Barring an emergency requiring a special meeting, the next regular meeting will follow reconstitution of the Board after the municipal election in the Fall.

Some items on the agenda have already been covered in previous articles:

This article covers:

  • The CEO’s Report
  • Outsourcing of non-revenue automotive vehicle and equipment maintenance
  • Automatic Train Control for Line 1 Yonge-University
  • Five and ten year service plans
  • Transit network expansion update

I will review the Green Bus program update in a separate article.

CEO’s Report

The CEO’s Report contains many charts purporting to show the operation of the system. Unfortunately some of these hide as much as they tell by giving a simplistic view of the system.

I have already written about the wide discrepancy between actual short turning of vehicles and the reported number. A distortion this major calls into question the accuracy and honesty of other metrics in the report.

In a future article, I will turn to the appropriateness of various metrics, but here are some key areas:

  • Averages do not represent conditions riders experience. Data that are consolidated across hours, days, locations and routes hide the prevalence of disruptions. Service that is fairly good on average can be terrible for riders who try to use it at the wrong time.
  • Values for some metrics are reported with capped charts that show only that a target is met, but not by how much it was exceeded. This gives no indication of the room to improve the target value, nor of the variation that could make a higher target difficult to achieve consistently.
  • Reliability is shown only for vehicles that actually operate in service, but there is no measure of actual fleet utilization and the headroom for service growth using available buses, streetcars and subway trains.

In discussion of the report, Commissioner Carroll noted that the TTC still has a problem with on time performance for streetcars. CEO Rick Leary replied that there is an On Time Performance team who are looking at details including recognition that there are three types of routes: those that run well, those affected by construction and those with other problems.

Carroll replied that people are quick to complain about King Street and wondering why they are still waiting for the 504. The TTC says that construction is the reason, but do they have a strategy to deal with bunching and communicate with riders. Management replied that they have strategies for keeping riders informed during planned diversions, but for unplanned emergencies there are service alerts. Changes are coming and service should improve.

This discussion was frustrating to hear because, first off, the central part of 504 King between Dufferin and Parliament is not affected by construction. Only the outer ends in Parkdale/Roncesvalles and on Broadview have (or had until recently) bus shuttles. As for keeping riders informed, irregular service plagues all routes in the system as I have documented in articles here many times. The problem is line management, or the absence of it.

On another topic, Carroll noted that the TTC seems to have a lower standard for the condition of stations than it does for vehicles, or at least tracks the latter at more detail. Leary replied that a summer blitz using student workers will scrub down all stations to bring the system back to a better quality for riders returning in the Fall.

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Transit Expansion Update, June 2022

This article reviews two reports on City Council’s agenda of June 15, 2022:

The subjects here are primarily the Ontario Line and the Eglinton Crosstown West Extension. The Eglinton East and Waterfront LRTs were discussed in a previous article.

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The Cost of Running Line 5 Crosstown

At its meeting on April 14, 2022, the TTC Board will consider a report about the arrangements with Metrolinx for operation of Line 5 Crosstown. This line, at least from a budgetary standpoint, is expected to open late in 2022.

There is a long agreement between Toronto and Metrolinx about how the costs are shared and who does what, and a much longer Project Agreement between the province and Crosslinx, the private consortium that built and is responsible for maintenance of the infrastructure and equipment.

Within the TTC report, these two documents are referred to as the “TOFA” and the “PA”.

Even with Toronto keeping any revenue the line generates, the net result will be an increase in the TTC’s costs. On an annualized basis, the net new cost to Toronto is $62.6 million annually. This is not surprising, but a fascinating point about this table is that the maintenance contract and other non-labour costs total $52.8 million while the labour and benefits for TTC staff (station, on-train, supervision) amounts to only $26.4 million.

This illustrates the substantial cost of owning and maintaining infrastructure as opposed to running the trains.

Responsibility for aspects of the route are divided among the parties as shown below.

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Infrastructure Ontario January 2022 Update

Infrastructure Ontario has issued its quarterly update of projects that are in the planning and procurement stages. This affects several parts of the Ontario government, but my focus here is on transit projects.

The spreadsheet linked below tracks the past and current updates to show how the projects have evolved. There are two sections: one for active projects and one for projects with no currently reported info (typically for projects that are now in construction or completed, or that have been withdrawn).

Where a cell is coloured yellow, there is a change from the October 2021 report. Several cells are coloured light yellow. There is new text, but the only real change is to say “Jan-Mar” instead of “Winter”, and similarly for other seasons. This eliminates a point of confusion in past reports.

The substantial changes in this round are:

  • The Ontario Line North Civil, Tunnels and Stations contract dates have slipped by one quarter, and the contract type has changed from DBF (Design, Build, Finance) to TBD (To Be Determined). This covers the OL infrastructure work from East Harbour to Science Centre Station.
  • The Yonge North subway extension has been split into two projects: one for the tunnel and the other for the stations, rail and systems. The projected dates for the tunnel contract are unchanged, but for the stations project they are TBD.
  • A new line has been added for the Eglinton West LRT tunnel between Jane and Mount Dennis.
  • All of the GO expansion projects have slipped into 2022 for contract execution, but with dates early in the year. This implies an imminent flurry of announcements just in time for the coming election. These projects are running a few years behind their originally planned dates.
  • The contract type for the GO OnCorr project which includes future operation and maintenance of the system has changed from DBOM (Design, Build, Operate, Maintain) to “Progressive DBOM” which appears to provide earlier design input from prospective builders as well as a better (from the bidders’ point of view) allocation of risk between Metrolinx and the P3.
  • The Milton GO Station project has not been updated since October 2021. It is possible that this work is paused pending a resolution of issues between Metrolinx and CPR about all-day operation on this line.

TTC Major Projects Overview: September 2021

The agenda for the TTC Board’s meeting on September 15, 2021, contains three related reports about the status of capital projects:

Among the projects discussed are several that relate collectively to the Bloor-Danforth Modernization Project (Line 2) that was originally proposed when Andy Byford was CEO. It was always a report that was “coming soon” to the Board, but after Byford’s departure, references to it vanished without a trace. I will return to the collection of BD Modernization projects later in this article.

A major problem for decades with TTC capital planning was that many vital projects simply were not included in the project list, or were given dates so far in the future that they did not affect the 10-year spending projections. This produced the familiar “iceberg” in City capital planning where the bulk of needed work was invisible.

The problem with invisibility is that when debates about transit funding start, projects that are not flagged as important are not even on the table for discussion. New, high-profile projects like subway extensions appear to be “affordable”.

There is a danger that at some point governments will decide that the cupboard is bare, and spending on any new transit projects will have to wait for better financial times. This will be compounded by financing schemes, notably “public-private partnerships” where future operating costs are buried in overall project numbers. These costs will compete with subsidies for transit operations in general. Construction projects might be underway all over the city, but this activity could mask a future crisis.

Please, Sir, I Want Some More!

The current election campaign includes a call from Mayor Tory for added Federal transit funding including support for the Eglinton East and Waterfront East LRT lines, not to mention new vehicles of which the most important are a fleet for Line 2.

The Waterfront East project has bumbled along for years, and is now actually close to the point where Council will be presented with a preferred option and asked to fund more detailed design quite soon. This is an area that was going to be “Transit First”, although visitors might be forgiven for mistaking the 72 Pape bus as the kind of transit condo builders had in mind as they redeveloped lands from Yonge east to Parliament. Some developers have complained about the lack of transit, and the further east one goes, the greater a problem this becomes.

The Eglinton East extension to UTSC was part of a Scarborough transit plan that saw Council endorse a Line 2 extension with the clear understanding that money was available for the LRT line too. Generously speaking, that was wishful thinking at the time, and Eglinton East languishes as an unfunded project.

For many years, the TTC has know it would need a new fleet for Line 2 BD. The T1 trains on that line were delivered between 1995 and 2001, and their 30-year design lifespan will soon end. As of the 2021 version of the 15 year capital plan, the replacement trains were an “unfunded” project, and the project timetable stretched into the mid 2030s.

City budget pressures were accommodated a few years ago by deleting the T1 replacement project from capital plans. Instead the TTC proposed rebuilding these cars for an additional decade of service. This would stave off spending both on a new fleet and on a new carhouse, at the cost of assuming the trains would actually last that long. The TTC has found out the hard way just what the effect of keeping vehicles past their proper lifetime might be, and that is not a fate Toronto can afford on one of the two major subway lines. The T1 replacement project is back in the list, but there is no money to pay for it.

Finally, a signature John Tory project is SmartTrack which has dwindled to a handful of GO stations, some of which Metrolinx should be paying for, not the City (East Harbour is a prime example). If we did not have to keep the fiction of SmartTrack alive, money could have gone to other more pressing transit needs.

When politicians cry to the feds that they need more money, they should first contemplate the spending room they gave up by ignoring parts of the network and by putting most if not all of their financial nest-egg into politically driven works. It does not really matter if Ontario has taken over responsibility for projects like the Scarborough Subway because one way or another the federal contribution will not be available to fund other Toronto priorities. The same is true of the Eglinton West LRT subway.

Any national party could reasonably say “we already helped to pay for the projects you, Toronto, said were your priorities”, but now you want more? A related issue for any federal government is that funding schemes must be fitted to a national scale, and other cities might reasonably complain if Toronto gets special treatment.

A Long Project List

  • Bloor-Yonge Capacity Improvements
  • Line 5
    • Eglinton Crosstown LRT
    • Eglinton Crosstown West Extension
    • Eglinton Crosstown East East Extension
  • Line 6 Finch LRT
  • Line 1 Extension to Richmond Hill
  • Line 2 Extension to Sheppard/McCowan
  • Line 3 Ontario
  • Waterfront Transit Network
    • East LRT and station expansions
    • West LRT from Exhibition to Dufferin
  • BRT Projects
    • Durham-Scarborough
    • Dundas West
  • Line 4 Sheppard Extension
  • Transit Control Integration
  • Subway Fleet Replacement (T1) and Expansion
  • Fleet Storage
  • Automatic Train Control
  • Platform Doors
  • Easier Access Plan
  • Purchase of New Buses and Electrification
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Have Your Say on the TTC’s Plan for Lawrence and Leslie Bus Services

Updated Aug 21/21 at 5:00 am: Link to survey corrected.

Updated Aug 22/21 at 12:05 pm: For some unknown technical reason, the survey closed sooner than it should have done. The TTC is working with their vendor to get this fixed.

Updated Aug 22/21 at 10:00 pm: The survey is available once again.

The TTC plans to restructure the 54 Lawrence East, 954 Lawrence East Express and 51 Leslie routes as part of the changes for introduction of Line 5 Crosstown late in 2022. They are conducting a survey of rider opinions on their proposals that is open until August 30.

Route 54 now operates between Eglinton Station and Orton Park / Starspray via Eglinton, Leslie and Lawrence. The proposed new route will begin at Science Centre Station (Don Mills & Eglinton) and will run north on Don Mills, then east on Lawrence. Note that there is a separate proposal as part of a Scarborough route reorganization to split off the Orton Park service as a separate route.

Route 954 now operates during peak periods express between Starspray Loop and Lawrence East Station. The proposed route will be extended to Science Centre Station over the same route as the local 54 Lawrence East service. There is no word on whether hours of service will be expanded beyond the peak period. Note also that after mid-2023 when the SRT shuts down, there will not be an RT service from Lawrence East Station to Kennedy Station, although plans are now underway in a separate study for reconfiguration of routes after the RT closes.

Route 51 Leslie now operates between Eglinton Station and Leslie/Steeles via Eglinton and Leslie. Route 56 Leaside now operates between Eglinton and Donlands Stations via Eglinton, Laird, Millwood and Donlands. The proposed route would combine 51 Leslie with 56 Leaside to provide one route from Donlands Station to Leslie/Steeles. (A peak period short turn would duplicate the existing Leaside via Brentcliffe service, and only about half of the 51 Leslie buses would run north of Eglinton.)

The combined effect of these changes would remove routes 51, 54 and 56 from Eglinton between Yonge Street and Don Mills (except for the short jog between Leslie and Laird by the combined 51 route). Only the 34 Eglinton bus would remain.

Also, service on Lawrence between Leslie and Don Mills would be provided only by the infrequent 162 Lawrence-Donway bus which does not directly serve the intersection at Don Mills.

For further info on the 2022 service plan, please see TTC 2022 Service Plan Consultation.

TTC 2022 Service Plan Consultation

Updated June 28, 2021 at 6:10 pm:

The TTC has filled in some of the details on 51 Leslie, 88 South Leaside and 354 Lawrence East Night. See the individual sections of this article for details.

The TTC has launched public consultations for its 2022 Service Plan. This will be a difficult year in which ridership is expected, at best, to climb back to 75 per cent of pre-pandemic levels. Budgets will be tight because the transit system plans to be operating close to 100 per cent of is former service (building up gradually on the buses for January 2022, then streetcars and finally the subway) even though fare revenue will be at a lower level. The TTC recognizes that it needs to provide good service to attract riders back to the system.

For the week of June 4-11, boardings on each of the TTC’s networks by vehicle type are still below 50 per cent of January 2020 values:

  • Bus: 40%
  • Streetcar: 27%
  • Subway: 23%
  • Overall: 31%

Trip occupancy for buses is generally below the target level.

  • 4% of trips are over 50% full
  • 0.6% of trips are over 70% full
  • 0.3% of trips are over 80% full

An important distinction about crowding measurements is that as ridership recovers, a the definition of a “full” bus will rise from 25 riders today, to 35 and then to the “standard” full load of 51. Service levels and crowding in 2022 will be measured and allocated against this shifting target. In the short term, service will be provided at a crowding level below pre-pandemic times.

Crowding levels reported now are all day, all route, all week values, and they hide problem areas in the system. The TTC still does not break out reports on crowding or service quality by route, location or time of day. Their “On Time Departure Report” has not been updated in several years, and although there is still a link to it from the Customer Service page, the link is dead.

The 2018 Customer Charter is still linked and it includes a commitment, carried forward from the 2013 Charter:

Posting the performance of all surface routes on our website so you know how your route is performing.

One might ask why Rick Leary, the man Andy Byford hired to improve service, is incapable of producing reports of service quality beyond the extremely superficial level found in his monthly CEO’s Report. The TTC have detailed crowding data and use them internally, but do not publish them. As for on time performance or headway reliability, I have written extensively about problems with service quality and these metrics. Even though service is the top of riders’ desires, it is not reported by the TTC probably because the numbers would be too embarrassing.

This is a gaping hole in TTC Service – the absence of meaningful reporting and measurement of service quality as experienced by riders.

Although the TTC plans to return to 100 per cent service, this does not mean that the service patterns will match those of early 2020. Demand patterns have changed both in daily patterns (peaks or their absence) and location (heavier demand to suburban jobs in sectors where work from home is impossible). To the extent that peaks are smaller or non-existent, this works in the TTC’s favour by allowing a higher ratio of service hours to driving hours (buses spend less time, proportionately, going to and from garages). This also, of course, spreads out demand and can reduce crowding.

A new phenomenon is the early morning peak caused by commutes to jobs outside the core. This produces crowding even on some Blue Night Routes, and the TTC is looking at how this can be resolved.

There is a page on the TTC’s site including a link to a survey about planned changes including some new and revised routes, as well as the plan for route restructuring to accompany the opening of Line 5 Eglinton Crosstown. Tentatively, that line is expected to begin running on July 31, 2022 according to the TTC, but that is simply a planning target, not a hard date.

In this article, I have grouped the planned changes geographically to pull together information on related routes rather than numerically as they appear on the TTC’s site. I have also included information on some changes planned for later in 2021 to put the proposed 2022 route structure in context.

There is a separate consultation process launching soon regarding the future service design for the period between the shutdown of Line 3 Scarborough RT in mid 2023 and the opening of the Line 2 Scarborough extension in fall 2030.

There are three major components in the 2022 plan:

  • Optimize the network to match capacity with demand.
  • Restructure the network for the opening of 5 Eglinton Crosstown.
  • Modify the network to respond to customer requests, evolving demand patterns and new developments.

All maps in this article are from the TTC’s website.

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