Byford says TTC’s pinching pennies, would not oppose task force

Tory’s proposed task force would show transit service is hard at work trimming fat, says Andy Byford.

Thestar.com
Aug. 5, 2016
By Ben Spurr

The head of the TTC says he wouldn’t oppose the mayor calling in a task force to examine the transit agency’s finances, but he believes doing so would only confirm that he’s doing everything possible to cut costs.

TTC CEO Andy Byford made the comments during an exclusive sit-down interview with the Star on Thursday. The day before, Mayor John Tory raised the prospect of asking an outside party to review the commission’s books, after Byford wrote an internal memo warning that the cuts required to meet Tory and council’s directive that all city departments cut their budgets by 2.6 per cent next year would be “unpalatable.”

While Byford stated Thursday he thought that getting a second opinion would merely vindicate his leadership, he also said he hoped it wouldn’t be necessary. “I would argue we are the task force,” he said.

“I would be very confident that if a task force came in, they would find that we either have already done, are already doing, or have plans to do what they would recommend.”

Byford stressed that he and the mayor are not feuding over the budget. He said the pair had spoken Wednesday and “we are both on the same page on the need to find further efficiencies” and avoid service cuts.

But Byford rejected a comparison Tory made the day before that likened the TTC to the Toronto Police Service, which has sparred with successive administrations over attempts to cut its budget. In February Tory led a successful effort to form a task force to reign in police spending.

Byford called the comparison “entirely unfair.” He said the TTC has made cuts when asked, including in 2012 when then-Mayor Rob Ford demanded a 10 per cent budget reduction from all departments.

The CEO argued that since he took the TTC’s top job four years ago he has aggressively pursued efforts to modernize the century-old organization, and hired new executives to look at the agency through fresh eyes. He touted cost-saving measures he’s backed, such as contracting out bus cleaning jobs, the implementation of the Presto fare-card system, and one-person subway operation, which will be tested on the Sheppard line this fall.

In total the TTC has identified an estimated $175 million in long-term savings that could be realized through such policies, Byford said, but they won’t take effect in time for next year.

Tory is adamant there are more savings to be found as transit agency prepares its 2017 budget, citing a May auditor-general’s report that found the commission had implemented just 14 of 53 cost-saving recommendations from previous audits. Byford said the TTC is working to complete the outstanding recommendations, except for a handful that the agency has deemed would be detrimental.

The 2.6-per-cent reduction council and the mayor have asked for would amount to a cut of about $16 million from the TTC’s net operating budget of $611 million. The agency has found about $19 million in departmental savings, through measures like only hiring workers to fill vacancies in critical positions and deferring all non-essential non-labour expenditures.

“We have found the 2.6 (per cent). In fact we found more than the 2.6 (per cent),” Byford said.

The challenge is that in order to reduce its budget, the TTC is - beyond the $16 million in savings - being asked to swallow cost increases projected to total $215 million next year, for a total of $231 million in savings and new revenues needed.

That opening pressure is driven by items like Presto implementation, the opening of the Toronto-York Spadina subway extension, bus and subway maintenance, and TTC workers’ collective bargaining agreement.

In addition to the $19 million in departmental savings, the TTC has located about $63 million to bridge the shortfall, including $40 million in additional revenue that could be raised by implementing a 10-cent fare increase, eliminating discounts for seniors and students when they pay a cash fare, and raising more money from parking.

In his memo, Byford wrote that the commission could reap even more savings by eliminating all fare discounts, cutting service, and delaying the opening of the subway extension, but he deemed these steps “unpalatable” because they would undermine service.

That has left a shortfall of $149 million for next year, which Byford said he will do everything in his power to address.

“We haven’t finished looking for the remaining gap. But all I’m saying is, if we’re starting from a position that it will not impact service . . . or do anything else that would materially make transit worse, that does limit your options.”