Metropass Usage Trends

A question often arises about just how Metropass riders use their passes. How many trips do they really take? How much of a “deal” are they getting compared to those who pay by tokens, tickets and cash?

The TTC conducts a rolling survey of passholders on a weekly basis with about 30 riders who keep track of where they travelled. It is a new group every week, and so over the course of a year, the TTC will have about 1,500 separate surveys.

The information recorded by riders is converted back into a trip count (allowing for “normal” TTC transfer rules) to arrive at a trips/week value for each person surveyed. With a small sample set, the values bounce around a lot, but aggregated over time, they can give an idea of what Metropass usage actually looks like. The data is used to calibrate the conversion factor from pass sales to “rides” in the TTC’s regular reports of “ridership”.

With over half of all “rides” now taken with passes, this conversion factor is important, and a small change in the multiplier used can have a big effect on the calculated ridership. Moreover, if Metropass sales fall, the presumed “loss” of rides is at the average for the whole group even though it is more likely that the lost customers will be relatively low users of passes.

Wondering about just what the numbers looked like, I asked the TTC for statistics from their weekly diary surveys spanning January 2015 to June 2016. The raw data are from the TTC, for which much thanks, but I have consolidated and reformatted them for this article. The presentations and interpretation are my own.

The overall numbers for the 18 months are shown in the table below.

MetropassDiarySummary

This table groups the data by the number of trips reported in the week.

About two thirds of the diaries report between 10 and 19 trips a week, and the overall average is 16.28. Note that the “trips” values shown here are actually calculated from the individual values (i.e. number of diaries times number of trips).

Another way to look at this is to plot the percentage of diaries reporting individual numbers of trips.

MetropassDiaryTripDistribution

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Campbell House Move

On March 31, 1972, Campbell House moved from the intersection of Adelaide and Frederick to its present location at Queen & University.

Here is a record of that move.

All photos are by Steve Munro.

Click on a photo to launch the view in full screen mode.

Where Does Ottawa’s New Transit Funding Fit In Toronto’s Budget? (Updated)

Updated August 30, 2016 at 5:00 pm: The TTC has responded to questions regarding the relationship of new federal funding to their budget. See the end of the article.

With many Huzzahs! the federal government announced the details of funding for many projects in Toronto and other parts of Ontario under its new Public Transit Infrastructure Fund. This first step concentrates on “state of good repair” (“SOGR”) projects, especially as they relate to the TTC whose capital budget has been constrained by Toronto Council’s willingness to raise new revenues for only a few pet projects.

Press reports, together with the usual tub-thumping from Mayor Tory, imply that we are about to see a huge leap in work on TTC infrastructure upgrades. This sounds good, but the truth is not quite so simple, or as photo-op worthy.

The TTC’s Capital Budget can be a forbidding document, even in the short version that is online. The full version, with detailed descriptions of every project, fills two large binders. A fundamental problem, as we have heard every year for some time now, is that the total value of the ten-year Capital Plan is not completely funded, and there is a shortfall over that period of close to $3 billion. This does not include projects with their own earmarked funding such as the Spadina Subway Extension (aka “TYSSE”) or the Scarborough Subway Extension (“SSE”).

The main issues facing the City of Toronto and the TTC are:

  • Almost all ongoing funding for Capital spending has dried up at both the Provincial and Federal levels with only the Gas Tax flowing on an annual basis. This amounts to about $160 million from Ottawa and $70m from Queen’s Park (an additional $90m in Provincial funding goes to the Operating Budget).
  • City borrowing is constrained by a debt ceiling target such that no more than 15% of the Property Tax income is required to service the City’s debt. Major projects added to the budget in recent years, notably the Gardiner Expressway, have pushed the City right to that line leaving no headroom to finance additional projects until the early 2020s.
  • City Council has not been willing to raise additional revenues either through the property tax, or other mechanisms allowed by Queen’s Park, to service new debt beyond the 1.6% Scarborough Subway levy, and Mayor Tory’s proposed 0.5% levy to help fund some other capital needs.
  • Queen’s Park announces a lot of transit funding, but this focuses on areas outside of Toronto. Even within Toronto, it flows mainly to Metrolinx, not to the City and TTC. All of the new funding is for Capital projects, not for day-to-day operations.

The City of Toronto reacted to the discrepancy between the overall Capital Plan and available funding by requesting cutbacks in the planned budget. The effect is back-end loaded, in the sense that the higher cuts come in the later part of the plan, in part with the hope that the Tooth Fairy will arrive to bail out the funding crisis before these cuts actually have to be made. However, the cuts did start to kick in for 2016 with the City asking that the TTC pare $53 million from its Capital Budget. Of this, about 60% came from a “Train Door Monitoring” project that is intended to provide subway operators with the ability to view the entire train from their cabs, and thereby allow one-person crews on subway trains. The remaining 40% came from track, power, bridge and tunnel projects.

For the line-by-line requested cuts, scroll down to page 54 of the “short version” budget linked above. Note in particular the large value of cuts from 2020 onward.

Requested cuts for future years are $42.6m in 2017 and $78.3m in 2018 (with higher amounts beyond). This is the context in which “new” money comes to Toronto. Where the TTC is concerned this funding does not generally spawn new projects, it merely backfills the funding level provided by the City.

In the short term, Ottawa is funding SOGR projects because (a) that’s where the budget shortfall really is and (b) large scale new projects simply cannot be fired up quickly enough to absorb significant funding in the two year period (April 2016 to March 2018) that this phase of the PTIF will be available. Those large projects are expected to show up in the next round of funding to be announced, probably, in early 2017.

Ottawa’s List and the TTC Capital Budget

To make life simpler for people trying to make sense of the announcement, I have consolidated information from the Federal news release with information from the TTC’s Capital Plan. In the following table:

  • The columns “Federal Project Name” and “Amount” are taken from the announcement itself.
  • The “TTC Project Number” is taken from the budget details which appear on pages 34-53 of the TTC Capital Plan. This is provided mainly as an indication of the source of project descriptions and values.
  • The “TTC Project Amount” shows the spending for 2016-2018 included in the plan. Note that there are three lines for each item in the plan showing the previous year budget, the proposed version for 2016-2025 and the change since last year. The values in my list are from the second (current budget) line.
  • In a few cases, the Federal line item actually embraces more than one line in the TTC plan, and I have broken these out.
  • A few of the Federal items have no matching project in the TTC’s 2016 plan (which dates from late 2015), and I believe that these are new projects created going into the 2017 budget cycle.

20160823_ProjectList

The Federal contribution generally does not line up with the TTC numbers for a few reasons:

  • Federal budgets run from April 1 to March 31 of the following year. TTC/City budgets run on a calendar basis. A project may have funding over three calendar years, but not all of the spending will align with the two year window of the PTIF program.
  • Some TTC programs appear to have changed in scope since the 2016 budget came out as the Federal allocation is substantially larger than the TTC’s planned spending. This shows up notably in a project for the Automatic Passenger Counters project which appears to have been expanded to embrace the entire fleet, not merely a subset of vehicles that would be rotated among routes. (Why this is needed considering the onset of Presto and its available data is something of a mystery.)

Media reports have spoken of the new funding accelerating the provision of accessibility at subway stations. This is an odd claim because the City removed its request for the TTC to reduce the “Easier Access III” budget in the 2016 round, and planned work is already funded out to 2020. Unless the TTC can fire up more construction in very short order, it is hard to understand just what is available to be “accelerated”.

The primary effects of the new funding are:

  • The City will be able to remove, at least for the next few years, some of the reduction requests against the TTC’s plan because Federal Money will be available to fill the gap.
  • Some projects that the City had expected to fund largely with its own revenue will now be shared making City funding available for other line items (assuming that old “commitments” actually stay in the transit budget and don’t migrate to other non-transit projects).

The project list linked here shows two pages of TTC projects with a total of $360 million in Federal Funding (out of $1.671 billion the TTC planned to spend on these items over 2016-18) on the first two pages. The last page shows all of the other projects which fall under various City department budgets totalling $114 million. The grand total of new Federal funding here is $474 million.

What we do not know yet is the level of City funding that will be provided against the various areas of TTC capital needs.

Pending Updates

I have asked the TTC to confirm details of this announcement and how the monies will be used, but do not expect a detailed response until more is published on the 2017-2026 Capital Plan. This will likely happen at the September 6, 2016 TTC Budget Committee meeting, assuming it actually takes place. As additional information becomes available, I will update this article.

Clarification

In my version of the project table, I have shown planned TTC spending only for 2016-2018, but the full project costs for these can extend well beyond 2018 (details are in the TTC budget report). The Federal contribution in these cases is a lower percentage of the total than might appear to be the case because the “out year” TTC costs are not shown.

This is most strikingly shown in the project to purchase 99 new buses where Ottawa is partly funding only 4 vehicles. The total project cost for 2017-2021 is $75m (see page 44 of the budget pdf), but Ottawa is only funding $1.3m, about half of the planned spending in 2017. The remaining 95 buses would be acquired after PTIF ends and they are not funded through this program.

Updated August 30, 2016 at 5:00 pm

I posed several questions to the TTC and have received the following replies.

Q1: The federal announcement looks to be mainly for existing capital projects. Is this being used to backfill city cuts?

A: This particular program is designed to be primarily for state-of-good-repair projects that are “shovel ready”. So what the TTC put forward through the City of Toronto were just that.

The 10-year 2016-2025 TTC capital budget had a funding shortfall of something in the order of $2.7B. These are not city cuts.  The TTC actual 10-year needs exceed known capital funding (gas taxes, city debt, etc.).  These funds will be used to help solve some of that shortfall.

Q2: There were several broad reductions in parts of the capital budget this year and for future years to bring spending within city debt limit. See the 2016 TTC Capital Budget Report at page 54 of the linked pdf.

A: The broad reductions included in the current 10-year capital budget were designed reflect expected spending levels based on historical spending trends.  They too are not cuts. The TTC is undertaking a more detailed look at this as part of our current budget process.

I challenged the TTC on this statement. There is always a difference between proposed and actual spending due to changes in project schedules and scope. However, the amounts involved, particularly in the later years of the budget, are well above the usual gap. The TTC clarified their response.

A: “Historical spending” is just that and some amounts have been factored into the individual projects to account for that.  “Unfunded Budget Reduction” is the budget shortfall between the TTC’s 10-year capital needs and the funding that’s available from City debt, gas taxes and other existing funding.  It happens that in the first few years of the 10-year budget, there is sufficient funding. But as you note, over the long run there isn’t.  The shortfall grows to be a very substantial number of about $2.7B over 10 years.  If we don’t get that funded, that would be a huge capital budget cut.

That’s precisely why the federal funding announcement was so welcomed by us.  It doesn’t wipe the shortfall out entirely, but it really helps over the next 3 years.

Q3: Am I correct in saying that the new money does not spawn new projects, only replenishes funding for those already in progress?

A: The TTC does an annual 10-year capital forecast, so most state-of-good-repair needs are reasonably well spelled out in that plan.  New things may crop up, but in large measure this money is to pay for those on-going rehabilitation, refurbishment, improvement or replacement needs on existing assets.

Q4: There was talk of accelerating the subway elevator program but I don’t see the dollars in the announcement.

A: Staff have been reviewing the elevator program and the results of that review will be incorporated into the 2017-2026 TTC Capital Budget presented to the TTC Board in the Fall.

How Much Service Actually Runs on King Street?

In many past articles, I have reviewed the quality of service on various routes from the point of view of headway regularity, travel times and short turns. While these analyses can show that disordered service is commonplace, they do not address a more basic question: what is the actual capacity of service offered, how consistently does the TTC actually provide room for passengers to ride?

This article uses vehicle tracking data in a different manner.

Service at Bathurst & King picks up almost all transit vehicles in both directions without effects of short turns. However, raw vehicle counts do not directly represent “capacity” because this must be adjusted for vehicle size. For example, twenty streetcars in one hour can carry more passengers than twenty buses. The capacity per hour is affected by the combination of two factors: how many vehicles of each size actually passed the intersection, and how many vehicles even operated in the peak period. The latter factor is important because “missed trips” don’t just arise from erratic service, but also from a failure to field all of the scheduled vehicles.

Hour-by-Hour Capacity

The following sets of charts show the capacity of service passing Bathurst Street eastbound during the AM peak (0600 to 1000) and westbound during the PM peak (1500 to 1900). Data are shown for all weekdays from September 2013 to July 2016 except for February 2016 (because I do not have data for that month).

There are three types of chart in each set:

  • Vehicle counts by type by hour
  • Capacity of the vehicles observed by hour
  • Total capacity over the four-hour period

504_CapData_Bathurst_EB

504_CapData_Bathurst_WB

Visible in these charts is the fluctuation from time to time in the proportion of service provided with standard CLRV streetcars, articulated ALRV cars, buses and new Flexity LFLRVs (since June 20, 2016). Very low values on individual days correspond to situations where a diversion to much or all of the service away from the intersection, typically to Queen Street. Another factor is that occasionally information for the time in question does not exist in the data provided by the TTC.

Over the length of an hour, a small day-to-day variation might be expected in vehicle counts through minor service irregularity. However, the mix of vehicles affects overall capacity. Late 2014 saw the onset of bus replacements of streetcars, and the drop in streetcar counts came primarily from ALRVs which are much larger vehicles. The number of bus trips required to replace ALRV trips was substantially larger as the charts show. However, there remains a considerable fluctuation from day-to-day in the number of each type of vehicle.

Capacities are calculated from the TTC’s service design values:

  • CLRV: 74
  • ALRV: 108
  • LFLRV: 130
  • Bus: 51

Note that vehicles can carry more people than these numbers suggest under crush conditions, but service cannot be designed based on crush loads on every trip.

What is quite striking about the capacity charts is the fluctuation over a range of about 500 passengers per hour, roughly 25% of the typical value, during the busiest periods. In other words, even if the vehicles arrived evenly spaced and, therefore, evenly loaded, there would be a considerable change day-to-day in the quality of service experienced by riders.

This begs the question of whether the days with lower capacity arise from “traffic congestion”, the TTC’s favourite explanation for erratic service, or if another factor could be at work.

Vehicles in Service

Another way to look at the data is to simply count the number of vehicles in service on the route. The next charts report on the number of vehicles of each type observed on the central part of King (Jarvis to Jameson) from 0700 to 0900, and from 1600 to 1800.

504_CapData_VehicleCounts

What one would expect to see if the schedules are to be believed is that the vehicle counts would stay more or less the same for a series of weeks corresponding to one or more “board periods”, the five-to-six week periods for which set of schedules remains in effect. However, what we see, particularly for streetcar modes, is a substantial change day-to-day in the number of vehicles the TTC actually fielded. The total vehicle count has fluctuated quite a lot (a range of about 10 vehicles on a likely scheduled total in the high 50s in the AM peak).

The numbers here do not translate directly to capacity, but they are linked:

  • More streetcars and fewer buses can lead to higher capacity depending on the replacement ratio, but this can be offset by the degree to which larger streetcars (ALRVs) are used.
  • Schedule changes to increase running times, even at similar headways, result in more vehicles in service (because the round trip time is longer) but not in more capacity (the vehicles/hour counts are unchanged).

The TTC speaks of the bus trippers on King as “expanding capacity”. As the charts clearly show, they do not achieve this effect because they are only replacing streetcars, and not necessarily on an equal capacity basis. The buses are a response to a shortage of streetcars, not a service improvement, except in the sense that without them the remaining streetcars would be even less able to cope with demand.

One factor which the vehicle-based data cannot reveal is the degree to which runs are cancelled because there are not enough operators available to drive them. This is not just a manpower issue, but one of schedule design and the degree to which all runs are part of regular crews, and how many depend on spare or overtime operators whose availability fluctuates. Trippers that operate for a short period are especially vulnerable to this because they are short pieces of work more likely to be crewed as extras.

The TTC has many challenges on King Street, and the City is now studying ways to redesign the street to aid transit operations, among other goals. However, fielding a consistent level of service is an essential part of delivering a consistent quality to riders on the line, and the TTC does not achieve this.

There has been some growth in capacity of service provided on the central part of the route, notably with the service redesign for 514 Cherry, but how long this will last in an era of trimmed budgets remains to be seen.

Note:

The counts and capacities shown here include service on 514 Cherry starting in late June 2016, but do not include service on 508 Lake Shore. This service was suspended due to the streetcar shortage in January 2015 (PM peak), and June 2015 (AM peak). It contributed a small amount of added capacity when it operated, but this was quite erratic because the arrival times and numbers of vehicles assigned varied considerably. I do not have 508 tracking data for many of the months included in these charts, and so have omitted the route from the analysis.

The Mysterious 514 Car

The TTC’s new route, 514 Cherry, is travelling incognito these days with blank destination signs on the CLRVs and with only a small route sign bound over the “Short Turn” marker.

Originally, these cars were supposed to be signed:

  • 504 Parliament
  • 504 Dufferin

in their east and westbound directions, but clearly someone decided that this was confusing. According to @ttchelps this is supposed to be a “temporary” arrangement pending the arrival of new streetcars on the 514. However, that won’t actually be completed until mid-2017 at best.

Meanwhile, would-be riders are left to wonder just where these cars are headed.

If someone approaches from the rear or side of the car, nothing is visible. From the front, one might spot the small sign “514 Distillery” but even this is meaningless for a westbound car. Meanwhile, the TTC suggests the 514 as a way to reach the CNE even though nothing on the cars suggests that the Dufferin Gates might be their destination.

This is a recipe for discouraging ridership, especially from riders unfamiliar with the route. Regulars on King will quickly learn what these cars really are – after all, the TTC messes around with service in this corridor on a regular basis and learning this week’s variation is a survival skill. Visitors, be they tourists from New York or North York, are quite another matter.

From the 2015 Customer Charter Goals:

We will provide the clearest, most accurate and up-to-date service information possible to our customers.

Alas, it is time for another round of asking readers to report problems with inadequate, incorrect or out of date signs on the TTC. For a system that prides itself on “Customer Service”, they have a long way to go.

 

Who Maintains Presto Devices?

An out of service Presto reader is not exactly an unusual thing to find on a TTC vehicle, but when both readers are not working, this does not inspire confidence in the system. I posed a series of questions to the TTC about this, and today (August 11) received a reply from their Communications team.

Who is responsible for maintaining these devices? TTC or Presto?

PRESTO has responsibility for maintaining the devices.  On a temporary basis the TTC is doing first line maintenance, while second line maintenance and all other maintenance activities are done by PRESTO.  TTC and PRESTO are currently in discussions about the best long-term approach for maintenance of the PRESTO devices.

Will a vehicle’s not having a working reader become a reason for taking it out of service because it cannot collect fares?

If the devices aren’t working the operator will allow a customer to board and ask them to tap their PRESTO card at the next point of entry into the system.

Is it possible to change out a Presto reader as an on street repair?

The  TTC is  not doing on-street swapouts of devices – this is due to the potential disruption to service and customers, and the fact that the swap out may not correct the problem.  TTC’s emphasis has been to undertake these activities back at the garage or carhouse, where a proper assessment can be undertaken without disrupting service.

Assuming that the TTC retains its existing transfer rules, how does a rider avoid being charged for a new fare when one leg of their journey is not recorded because there is no working reader on the vehicle?

If the non-working device is the first one the customer encounters, there is no fare charged until that customer taps on a second device.  If it is the second device that a customer encounters that is not working, the PRESTO card still has a valid payment on it so there is still no issue.  It is only if the customer goes to a third device (after the second one isn’t working) that there may be a problem.  It would depend on the circumstances whether the customer may get charged a new fare.  If this did occur, it would be possible to investigate the situation using the data generated by the PRESTO system to confirm the circumstances and potentially provide any reimbursement to the customer.

In the subway, the new fare gates are TTC infrastructure and I assume TTC is responsible for maintenance (either directly or by contract). By analogy to the vehicles, who is responsible for the Presto component?

The TTC is responsible for the first line maintenance on the gates; the fare gate manufacturer is contractually responsible for second line maintenance.  If there are issues with the PRESTO component (e.g. PRESTO software) that component still is the responsibility of PRESTO.

Who maintains the fare machines in subway stations and on surface routes, both on vehicles and on platforms?

As above, contractually this is the responsibility of PRESTO.  Currently, first line maintenance of the Fares and Transfers Machines on new streetcars and on off-board locations are being done by TTC under an arrangement with PRESTO. The parties are discussing a long-term approach. For the PRESTO Self-Serve Reload Machines located near the fare lines in subways, PRESTO has the responsibility and is undertaking all maintenance activities related to these devices.

How much of the claimed saving of eliminating fare collection costs is not being achieved because of work TTC has to do to keep Presto operational? A dollar figure may be difficult to come by here, but is there a headcount for the staff who might otherwise have been redeployed who have to stay on fare equipment maintenance to service Presto?

The TTC is still very much in the early phase of transitioning from legacy fare media to PRESTO. Less than 4% of TTC’s rides are currently being undertaken using the PRESTO card.  Therefore, there are still ongoing responsibilities for legacy fare media that require maintaining staff until those activities are reduced or eliminated. Significant savings would not occur until legacy fare media was eliminated and the associated business processes were also eliminated.

And so, in brief, the answer is that TTC looks after things, at least for now, but will hand them off to others (Presto or the fare gate provider who has a maintenance contract). Split responsibilities are a recipe for missed communication and problems with tracking repair status, but we will see how this works out.

As for transfer rules, the problem (as discussed on this site before) lies with journeys of more than two vehicles where an intermediate leg is “missing” thanks to a non-working Presto machine. (This also affects riders making non-standard transfer connections such as for diversions and short turns, not to mention GPS errors.) Whether riders will even notice that they are being overbilled for Presto usage or will take the trouble to track their trip history online and complain remains to be seen. If the Presto equipment stays in good working order a very high percentage of the time, this won’t be a problem, but even a 1% out of service rate could affect a large number of trips.

TTC Service Changes Effective Sunday, September 4, 2016 (Updated)

Updated August 15, 2016: The detailed table of service changes has been added to this article.

September 2016 will see a return to the “winter” schedules on most TTC routes. Despite talk of service cuts in the budget process, the new schedules include some improvements to correct for operational problems on a few routes, and to better handle existing demand. The scheduled mileage for September is actually above the budget level due to greater than anticipated requirements for diversions and extra vehicles to deal with construction projects.

2016.09.04 Service Changes

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Understanding the Scale of Proposed TTC Budget Cuts

Recent media reports of the effect of John Tory’s requested 2.6% cut in TTC funding have cited numbers that might confuse readers by giving an incomplete view of TTC revenues and spending. In the interest of better-informed context for the debate, here is the full story.

The TTC Operating Budget contains two separate sections, one for the so-called conventional system and one for Wheel-Trans. That term, “conventional”, is the one used by the TTC to describe its base system, the one used by most riders. Each budget has three major components: fares and other revenues, operating expenses and subsidy. The numbers in the budget are never the same as the year-end actuals, but the TTC is usually within 1%. Here are the numbers as of the July 2016 CEO’s Report [pp 46 & 50].

                  Conventional           Wheel-Trans            Total
                  Projected  Budget      Projected  Budget      Projected  Budget
Revenue
  Fares           $1,150.3   $1,175.3    $    7.1        7.0    $1,157.4   $1,182.3
  Other               66.1       66.8                               66.1       66.9
  Total            1,216.4    1,242.1         7.1        7.0     1,223.5    1,249.1
Expenses           1,726.0    1,736.7       128.4      123.7     1,854.4    1,860.4
Subsidy Required     509.6      494.6       121.3      116.7       630.9      611.3
City Subsidy         493.6      493.6       116.7      116.7       610.3      610.3
Draw From Reserve      1.0        1.0                                1.0        1.0
(Shortfall)       (   15.0)              (    4.6)              (   19.6)

1. All figures in millions of dollars.
2. Other revenue includes contract services, advertising, rent, parking and interest.
3. The reserve contains funds from previous years' "surpluses".

When the City looks for a cut, this is based on the “net” budget, in other words the subsidy that the City pays, not on the gross operating budget including fare revenue. Any shortfall would be covered by a combination of expense reductions and fare increases. In the “other revenue” category, the only item subject to extraordinary year-over-year increases is parking because the remainder are dictated by longer-term contracts. Commuter parking will bring in about $9.2 million in 2016, and even doubling these fees (assuming no loss of demand) would bring in only a tiny amount relative to the entire budget.

The starting point set by the Mayor and approved by Council is a 2.6% across the board cut to all departments and agencies. For the TTC, this translates to 2.6% of $611.3 million (the 2016 budget figure) or $15.89m.

However, the TTC faces many cost pressures including:

  • Inflationary increases in utilities and materials
  • Wage rate increases in the negotiated contract
  • Costs for Presto implementation including the co-existence of old and new fare collection methods and staffing during 2017
  • Increased vehicle maintenance cost (aging bus, streetcar and subway fleets, continued operation of old streetcars due to Bombardier delivery delays)
  • Startup costs for the Spadina Subway Extension including maintenance of completed structures, and pre-opening activities such as training
  • Substantial increase in demand for Wheel-Trans in part due to provincially mandated changes in eligibility, partly due to demographics

Moreover, if ridership for 2017 stays at the 2016 level, then the projected revenue (leaving aside any fare increase) will be lower than the 2016 budgeted level.

According to The Star, the TTC projects that the funding gap in 2017 will be $184m for the conventional system and $31m for Wheel-Trans. That is the difference between projected revenues, subsidies with the 2.6% cut taken into account, and projected expenses just to operate the system at 2016 service levels. One can work backwards from these numbers to see what the 2017 budget looks like before any further adjustments are made.

                  Conventional   Wheel-Trans    Total
2016 Subsidy      $  493.6       $  116.7       $  610.3
2.6% Cut              12.8            3.0           15.9
2017 Subsidy         480.8          113.7          594.4

Added 2017 Costs     184.0           31.0          215.0
Total Shortfall      196.8           34.0          230.9

2016 Budget        1,736.7          123.7        1,860.4
% Cut vs 2016         11.3%          27.5%          12.4%

1. All figures in millions of dollars.
2. Some numbers do not add due to rounding.

An obvious question here is whether Council will attempt to avoid the unpalatable effect of a large cut in the Wheel-Trans budget (one which would likely violate provincial service level requirements) by shifting the lion’s share of the cut to the conventional system. Offsetting this would require an even larger fare increase and/or service cut. The last thing Toronto needs is a fare and service battle between the Wheel-Trans user community and the rest of the system’s ridership.

The average fare currently sits at $2.11 (total probable fare revenue divided by probable ridership of 544m), while the adult token rate sits at $2.90. A ten cent fare increase would raise this to $3.00, or 3.4%. This would translate to $39m in added revenue before allowing for ridership loss (a dubious proposition in an era of limits on service expansion). [This paragraph has been updated to correct the value of the token fare and subsequent calculations.]

Various possible changes to fares and expenses include (according to the Star’s article):

  • Eliminate cash fare discounts (reduced fares would only be available through tickets, tokens, passes and Presto)
    • Total additional fare revenue including fare increase: $40m
  • Controls on Presto, diesel fuel and employee benefits: $7.5m
  • Draw the remaining balance in the Transit Stabilization Reserve: $15.4m
  • Unspecified reductions in the conventional system: $17m
  • Unspecified reductions in Wheel-Trans: $1.8m
  • Total: $81.7m

It is unclear how some of these reductions would actually be achieved, and it is not unusual to see the TTC start off the year facing a challenge of trimming expenses as it goes along to fit the available subsidy.

Further possible cuts include:

  • Elimination of Metropass discounts: $80m
  • Cutting service: $60m
  • Deferral of the Spadina extension opening to 2018: $6m

These are not recommended by TTC management.

The relatively small saving through elimination of Metropass discounts gives a view into how riders actually use the system. Passholders account for over half of all adult “trips”, but one cannot simply assume that they would continue to make all of these journeys if they had to pay for each of them separately. The idea that all pass trips represent a huge subsidy (because the lower average fare one can achieve with very frequent use is “lost revenue”) simply does not hold up. Unfortunately, TTC management has encouraged this view ever since passes were introduced.

The total number of trips taken using any form of pass in 2015 was 292.983 million, or 55% of all ridership. With a projected saving of $80m, the average per pass trip is about 27 cents. However, eliminating pass-level pricing would represent a large fare increase and would affect ridership numbers, a counterproductive move when getting people onto transit is supposed to be one of the City’s priorities. Pass usage as a percentage of total ridership has grown from 25% in 1987 to 50% in 2008, and to 55% in 2015. This is now the primary way in which riders pay for travel, and the bean-counting politicians who agonize over TTC fares should stop thinking in terms of tokens, tickets and cash. Riders prefer to purchase their service in bulk at a fixed price, and this should be encouraged to simplify the fare system for as many riders as possible.

Mayor Tory’s financial schemes have been “running on the fumes” for two years, and the 2017 budget marks the point that his fantasies simply will not be tenable. Does Council have the will to tackle this problem, or will transit riders (not to mention users of many other City services) be forced to suffer through the effects of the tax cutters’ naïve belief that they can control costs through searches for “efficiency”? Will voters, especially those represented by Tory’s henchmen on Council, tell their representatives that cuts are unacceptable, or will those who languish awaiting suburban buses put their faith in myths about “waste” that prevents their having frequent, comfortable service?

Remember all of this the next time someone promises you billions in spending on transit, roads and other civic baubles.

Tory Threatens Fiscal Chaos At TTC, Misrepresents Auditor General’s Findings

Toronto’s Mayor Tory finds himself painted into a corner, a task he achieved all on his own with a mindless, solitary focus on controlling taxes and reducing waste in government spending. One might almost think Rob Ford was still in the Mayor’s office, especially considering that Tory’s understanding of the City’s financial situation is on a par with his predecessor’s. By “understanding” I do not mean simply reading and digesting reports from the City Manager, but of moving beyond knee-jerk reactions and policies where facts are not allowed to intrude on political fiction.

The fiction that we don’t need more taxes, that there are “efficiencies” to be found throughout the City, has strangled services through the Ford years, and shows no sign of releasing its grip under Tory. Unquestionably, from a starting point back in the “old days”, one might find money to be saved in any organization. However, there is a limit to how many rabbits there are in the budget hat, and as years go on, those rabbits get rather scrawny. In his recent presentations to Council, City Manager Peter Wallace warned that the hat is empty, and that the hocus-pocus by which past budgets have allowed low tax increases cannot continue. New revenues must come from somewhere because cuts simply won’t provide the level of savings required.

Shawn Jeffords in the Toronto Sun quotes Tory:

Tory said he would accept the TTC’s submissions as an “interim report” and assume that further efforts will be undertaken to meet the council directive. He also pointed to a report from the city’s Auditor General earlier this year which said the TTC had only implemented 14 of 53 cost-saving recommendations from her previous reports as evidence that further belt-tightening could be done.

This fundamentally misrepresents that Auditor General’s findings in a May 11, 2016 report:

Of the total 53 recommendations assessed in the current follow-up process, 14 recommendations, or 26 per cent, have been determined as fully implemented. For the remaining 39 recommendations, TTC staff have made significant progress towards implementing the recommended changes. [p 1]

In other words, the TTC is working on all of the recommendations and the AG is not breathing fire with any implication of foot-dragging or obstruction. That’s the implication Tory  brings to the discussion with the attitude that if the TTC won’t fix itself, he will find someone to do it for them.  As Ben Spurr reported in The Star:

“If (the TTC) can’t do this themselves, and I’m confident they have enough good management there to find these ways of doing things better and differently, then I guess we could help them,” the mayor said.

The AG’s recommendations flow from four reports going back to December 2012.

2016AuditStatus_Table1

What, exactly, does “not fully implemented” mean? Have they started? Are they almost finished? Is there a dispute about the validity of the AG’s proposals? How much will each of the changes actually save and, thereby, contribute to “fixing” the TTC’s financial crisis?

The background reports reveal that the “Total” counts shown above are only the items that were not “fully implemented” in previous reports. For example, the December 2012 Wheel-Trans audit had 22 recommendations of which 9 had already been implemented by April 2014 as reported by the AG. The numbers here imply a much lower rate of addressing issues because previously completed items have been dropped from the count.

When one takes the time to read the details, one will find that many of the 39 items listed above are on the verge of being completed, or are dependent on changes (such as updated computer systems) that will address clusters of recommendations in one fell swoop later in 2016. Few of the items will lag into 2017 and beyond, and at least some of these are dependent on other systems or events for their timing.

What is consistent throughout the reports is that outright rejection of the recommendations is rare, and work on many is well underway. Moreover, the dollar savings by each of the changes is rarely stated by the AG and so there is no way to gauge their relative importance and budgetary effect.

Mayor Tory is renowned for being at work at 6:00 am at City Hall digesting his reports. From the way he has presented the Auditor General’s information, it is clear that he does not know that the vast majority of the recommendations have, in fact, been acted on by TTC management. Moreover, he would also know that few of the recommendations have a concrete dollar saving attached, and for those that do, it is not on the scale needed to rescue him from the TTC funding crisis.

The TTC faces a shortfall of $184 million for its base system, and a further $31m for Wheel-Trans. The total budget for 2016 is $1.860.4 million of which $1,736.7m is for the base system, and $123.7m is for Wheel-Trans. Year-end actual expenses will be slightly lower due to some cost reductions in 2016, but the subsidy requirement will be higher due to ridership and fare revenue at a lower-than-predicted level.

This shortfall is very much the product of the political optics of the 2016 budget in which a rosy ridership and revenue projection removed the need for hard discussions about subsidies and allowed a continued focus on service improvements. That particular trick failed when the riders did not show up as expected, and 2016’s budgetary scam is only compounded in 2017. However, this time around, the numbers are too big to fudge.

The Sun quotes Mayor Tory:

“I just think that any big organization, where you’ve got billions of dollars and tens of thousands of employees, there are going to be those opportunities without diminishing service that just see you doing differently, running things better,” Tory said.

Tory, who never gives up the opportunity to spend money the City does not have in aid of yet another feel-good photo op, might be forgiven for confusing the “billions” in the TTC’s capital budget (the one that builds new subways and performs major repairs) with the operating budget that actually provides service (including basics like air conditioner maintenance). Most of the operating costs arise from putting service on the street and maintaining vehicles and infrastructure.

The TTC faced ongoing budget crises twenty years ago thanks to the early 1990s recession. By 1995, the proposed budget cuts were severe, but at least the effects were discussed in the open. The 1995 Operating Budget report and a companion response to a proposed 5% cut in agency spending laid out the situation. In 2016, we have yet to see a public debate on the TTC’s 2017 plans, and the issue has been conspicuously absent from TTC Board agendas. The TTC Budget Committee has not met this year, and currently plans call for a September 6 meeting with the results going to the full Board on September 28. This is hardly an organization chomping at the bit. Is the Board trying to avoid a confrontation with Mayor Tory? Why do we even have a TTC Board if the Mayor’s office will make all decisions of any consequence?

In the 1990s, the TTC took the politically necessary “we can make do” position on funding cuts, but this had major effects on service and maintenance. Then, on August 11, 1995, the Russell Hill crash permanently changed the TTC’s view of itself. Three people died thanks to a combination of poor training and inadequate maintenance.

To his credit, CEO Andy Byford has taken a firm position, or so it would appear, on the level of cuts the TTC can actually endure, but whether his position will win the day either at the TTC Board or at Council is quite another matter. Will Josh Colle, TTC Chair, finally stand up to the Mayor or risk losing any remaining credibility of his office?

The remainder of this article reviews the four Auditor General reports in detail.

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