Deal or no deal: update on the Ontario Line
BY SHELLEY CARROLL
Well, this is what they call a "turn-up for the books."
Ordinarily, when Toronto wants to build a transit line, we pay for all the research and planning, upfront costing and environmental assessments and then, months or years later, the other two orders of government agree to partner and fund it.
But the current Ontario government wants to build transit according to its own design. Basically, they want to buy any related design work that the City of Toronto and the TTC have done for reference and be handed over any money the federal government promised the City for its transit expansion plans.
And once the province has built their transit line, they want the TTC to operate it using only your Presto fares and Toronto's property tax coffers.
A new deal
The Mayor's staff gave me a very rushed version of the new deal for the Ontario Line the morning it was announced. It sounded like a pitch from a used car salesman because staff had been given only the highlights and best details to deliver to certain councillors. Later, when Mayor Tory announced the proposed transit deal, surrounded by members of his Executive Committee, I wondered why they all looked so dour.
As always with our partners from other orders of government — no matter who is in power — the devil is in the details. There is a lot of talk about how much money the City can now free up for its backlog of transit repairs and maintenance, but a detailed report coming to Council next week will shed light on the cons. There are a couple of statements in the summary of terms that trouble me.
"The Province will not seek City contributions towards the capital cost of the Provincial Projects, subject to the City redirecting the capital contributions it would have otherwise been expected to make to Provincial projects [...]"
I’ve read through the entire report in search of comforting words that indicate this term doesn’t mean what I think it means. Previously, we were expected to contribute $2.1 billion to the Relief Line South, now expanded to become the Ontario Line.
Staff assure me that we get to keep our money and walk away from funding the Ontario Line, which is great news because we can use it towards the TTC's state-of-good-repair backlog. But I'm still not convinced — no one knows the true cost of Doug Ford's newest project.
Item 7 of the terms sheet makes the hair on the back of my neck stand up. It speaks to the future of your ride, no matter what happens. It’s about the day-to-day operating costs of your TTC service.
"The City/TTC shall be responsible for the day-to-day operations of the Provincial Projects and the existing transit system, including labour relations, and the parties shall define, through an Operating & Maintenance Agreement(s), as applicable, the specific roles and responsibilities of the parties, including:
1. farebox revenue from the Provincial Projects will be used to defray operating costs;
2. the parties' roles and responsibilities in respect of all maintenance cost funding, the performance of all maintenance, and service standard setting; and
3. in respect of a Provincial Project that extends beyond the City boundary, the Province shall negotiate with the relevant neighbouring municipality an ongoing operating contribution commensurate with the level of subway service provided.”
You’ve heard me rant about this before. In 1995, when Premier Harris withdrew from the long-standing arrangement made by Premier Davis to fund 25 per cent of the cost of operating the TTC, your individual fare began to climb.
Worse still, cuts to service had to be made, with whole routes vanishing and bus frequency reduced. By the time I was elected to City Council in 2003, the TTC was struggling to build back its ridership.
When the Harris government was defeated, Toronto opened discussions with Premier Dalton McGuinty about restoring the provincial operating contribution to the TTC. Instead, the province wanted to talk about giving cities a share of gas taxes, similar to the federal government’s deal. It doesn’t add up to the 25 per cent we once had, and what we do earn generally goes straight back to the province in Presto licensing fees.
The agreement contemplated in term 7 is sorely needed whether these proposed transit lines materialize or not. Sadly, term 7 assumes that fare revenue will somehow cover operating expenses. This assumption is fundamentally flawed.
The fare you pay for transit never pays the full cost of riding the system. Globally, the health and sustainability of a transit system is always measured by the ratio between how much the rider pays and how much the government pays to subsidize each ride. In the Bill Davis days, ours was considered to have one of the best ratios.
While his government was contributing to the operating budget of the TTC, the farebox ratio was significantly lower than it is today. Now, after almost a quarter century of under-funding, 70 per cent of our fare box revenue goes toward operating costs — the highest ratio in North America.
I want to be happy about this new deal from the province. The biggest saving is that your property tax dollars will no longer be used to cover project cost overruns or legal claims. On the four lines the province hopes to start ASAP, they agree to absorb these.
But while their ambitious plans are being executed, our TTC costs will increase every year. On Sheppard Avenue East, for instance, there are no plans to expand the subway for at least another two decades. It will take operating more buses to carry all of the new population moving in along this stretch. After all, new developments along Sheppard Avenue were OMB-approved on the basis of adding rail transit.
Our TTC Board has work to do to make the TTC serviceable while all these lines and stations are being designed and built. As a member of that Board, I will continue to work hard to protect your interests and keep you informed.