TTC predicting $44.5-million surplus in 2017
Lower than expected spending on labour, fuel, vehicle maintenance, and Presto fare card fees means the transit agency will have cash left over.

TheStar.com
Oct. 16, 2017
Ben Spurr

The TTC is headed for a $44.5-million surplus this year.

Speaking to reporters after a meeting of the transit agency’s board on Monday, TTC CEO Andy Byford said the numbers, which are contained in his latest report to the board, have yet to be finalized. But he hailed the potential surplus as “testament to the efficient way that we run the TTC.”

“We have looked at every possible cost line to make sure that our (capital and operating budgets) are as thrifty as they can be while still getting done what we need to do,” he said.

The projected surplus is divided between the TTC’s conventional system, which is set to underspend by about $30.8 million, and the paratransit service Wheel-Trans, which is expected to have an extra $13.7 million.

As a result of the surplus, the TTC won’t need to make a planned one-time $14-million draw on a city reserve. Using the money this year would have exhausted the fund.

According to Byford’s report, the surplus for the conventional system is the result of several factors, including lower-than-expected spending on labour costs, vehicle maintenance, fees for the Presto fare card system, employee benefits, and fuel.

The cost of labour was reduced in part by delaying the hiring of some personnel at the Leslie Barns streetcar facility who aren’t yet needed as a result of delays in the vehicle order from Bombardier.

The Wheel-Trans surplus is being driven by lower than expected demand. The agency predicted ridership would continue to soar this year thanks to expanded eligibility criteria and Toronto’s aging population. But while it initially budgeted for 4.7 million rides in 2017, it’s now expecting just 4.3 million.

The surplus is being projected despite the loss in anticipated fare revenue resulting from the continued trend in flattening transit ridership. The TTC budgeted for 543.8 million trips this year, but is now expecting only about 538.3 million, which is roughly the same number it carried last year. The loss in expected fare revenue is calculated at about $1.3 million.

TTC riders hoping that the agency having extra cash on hand will lead to increased service this year will be disappointed.

In an email, TTC spokesperson Stuart Green said that city policy prevents the agency from reinvesting a surplus into the current year’s operating expenses. But he said that the agency will take lessons from this year and “money from areas that were underspent (in 2017) could be redirected in next year’s budget to other priorities.”

After a public spat last year in which Mayor John Tory threatened to call in a task force to examine TTC spending if the agency couldn’t find ways to achieve a 2.6-per-cent cut, council set the combined 2017 budget for the TTC and Wheel-Trans at $1.95 billion. Of that, roughly $687 million was a subsidy from the city, representing an increase of 11 per cent over the previous year. The budget included a 10-cent fare increase.

The TTC’s 2018 budget is expected to be finalized next February. The board has already voted not to raise fares next year, but the decision isn’t binding.