The hugely controversial Highway 413 will cost taxpayers billions. But just how much the province won’t say

Thestar.com
Oct. 8, 2021

If it ever gets built, the controversial GTA West superhighway, popularly known as Highway 413, will be the biggest new road project Ontario has seen in a generation.

Yet even as the province prepares to begin footing construction bills -- possibly before the legally required environmental assessment is completed -- the Ministry of Finance has declined to disclose the current cost estimates for the project, leaving taxpayers in the dark and industry experts to take their best guess.

According to the Ford government’s blueprint, the highway will add almost 60 kilometres of four- and six-lane asphalt and 11 new interchanges arcing through farmland and conservation lands across the top of Toronto, from Mississauga through Brampton and Caledon to Vaughan.

Some transportation experts worry the 413 may actually induce more traffic, and cause even nastier traffic jams on existing highways, including the 427, the 400 and the 401. And environmental advocates say it will add more than 17 million tonnes of greenhouse gas emissions by 2050, resulting in more than $1.4 billion in damages from that pollution.

But provincial transportation officials insist the 413 will significantly allay the GTA’s epic traffic gridlock problems, even as they warn that 50 per cent population growth is expected across the Greater Golden Horseshoe over the next 30 years.

“Congestion is already costing the economy up to $11 billion a year in productivity in the Greater Toronto and Hamilton area and will get worse if current trends continue,” a discussion paper released in late June by Ontario Transportation Minister Caroline Mulroney said, arguing in support of the 413 and other new transportation investments.

“Total hours lost in congestion would be more than tripled by 2051 if we don’t address this challenge.”

Last year, the government carefully positioned itself to legally begin commissioning early construction work on the 413 based on these much publicized numbers. While formal approval of the project is not expected until the environmental assessment is completed in late 2022, ground for some of the early work on the project could be broken much sooner.

And while the most recent cost estimates for the project made public are from 2011 and peg the costs at around $4.8 billion in 2011 dollars, some believe it could be nearly double that now.

Yet there’s no way to know: when it comes to the politically sensitive current cost estimates for the 413, the latest numbers are sealed in secrecy.

A Freedom-of-Information request for the 413 cost figures filed on behalf of the Star with the Ministry of Finance in March of this year yielded confirmation on Aug. 4 that numerous records exist relating to the 413 land acquisition and the highway construction costs.

But the Finance Ministry refused in its response letter to divulge those records, citing cabinet confidentiality.

“A search for records was conducted by knowledgeable staff in Office of the Budget. Eleven records were identified as responsive to your requests,” the ministry said. “A decision has been made to deny access to the records under section 12 (Cabinet records) of the Act.”

Similarly, a Freedom-of-Information request for the updated 413 figures filed with the Ministry of Transportation in March of this year has, so far, produced disappointing results.

After six months of work on the request, on Aug. 6 the Transportation Ministry’s Freedom of Information office said via email it is running behind its own deadline to respond by that day.

“Our office continues to work on your requests and we hope to issue access decisions for each one soon,” explained Natasha Mistry, a senior policy adviser in the freedom of information and privacy unit at the Ministry of Transportation.

When asked for the government’s current cost estimates on Aug. 17, Transportation Ministry spokesperson Brittany Allison cited the 10-year-old $4.8-billion estimate.

The project, Allison said via email, is in the planning, preliminary design and environmental assessment phase, which is expected to be completed by the end of 2022.

“Once completed,” she said of these preparatory efforts, “more specific cost estimates will be available.”

The secrecy comes as no surprise to Chris Gauer, a Calgary-based highway construction consultant who, for five years until 2019 directed highway projects for Infrastructure Ontario, a provincial agency that manages building contracts for highways and numerous other projects.

Gauer says it’s standard policy for governments to keep infrastructure construction cost estimates secret to ensure they don’t influence the bids submitted by construction companies.

Asked what the 413 might cost to build in current dollars, Gauer says the $2.6-billion cost of the two-phase, 66-kilometre extension of the 407 toll road, running eastward north of Whitby, Oshawa and Bowmanville to Highway 115, with two four-lane connectors running south to the 401, can serve as a reliable comparator.

“It’s the best metric to use,” Gauer says, “as Highway 407 is similar to the work on Highway 413 in terms of property development, number of lanes and topography.”

In pointing to the two 407 extension phases, Gauer notes that the roughly $1.4-billion winning bid for phase 1 of the extension was tabled in 2012, while the approximately $1.2-billion winning bid for phase 2 of the extension was tabled in 2015, and that road construction costs generally can be expected to roughly increase by 50 per cent every 10 years when considering a conservative four-per-cent annual construction price index.

Based on these costs, Gauer says that the government’s 2011 $4.8-billion cost estimate for the 413 likely remains roughly valid for a main construction start date of 2024.

“It’s in the ballpark,” he says. “Using a fairly conservative four-per-cent annual construction cost index, the 407 comparison cost would increase by about 50 per cent over 10 years, from about $2.6 billion to $4 billion.”

Gauer’s opinion roughly matches a 2019 Toronto Region Board of Trade estimate, which put the 413 construction costs “around $5 billion.”

Jonathan English, the board’s research director, agrees with Gauer that the 2012 and 2015 $2.6-billion 407 extension budgets offer reasonable reference points for pegging the 413’s current construction costs at around $5 billion.

But English warns that mass-transit construction-cost inflation rates in Toronto are among the highest in North America, and that this problem may also afflict the highway construction sector to some degree.

“There’s been a general acceptance that budgets for projects costing many times higher than peer-city projects is reasonable,” says English, who closely tracks construction costs in major cities worldwide.

“Controlling construction costs should be part of the Canadian infrastructure discussion. We need to better understand why our costs are so high and determine how to fix the problem.”

Georgene Geary, who chairs the construction industry committee of the U.S. Transportation Research Board, warns that COVID-19 has dramatically increased highway construction costs.

In her hometown of Atlanta, Ga., Geary notes that on Aug. 19 the Georgia State Transportation Board delayed a plan to build new toll lanes alongside existing highways over concerns about cost inflation within construction company bids that far exceeded government budgets for the project.

“Prices right now are hard to fix for highway construction costs,” Geary says. “Everything’s gone up. This is unprecedented and we don’t know where it’s going.”

In an analysis of GTA highway options released last April, Peter Miasek, president of Transport Action Ontario, a group that’s firmly opposed to the 413 for financial, environmental and transportation planning reasons, concluded that the current price tag for the proposed highway -- with inflation not factored in through the main, four-year construction period between 2024 and 2028 -- would likely be $2 billion a year for a total of $8 billion.

This represents $7.1 billion in current dollars, Miasek says, adding that the contract for the 413 will likely include a 30-year maintenance cost, which he estimates will add an additional $1.5 billion to the total price tag.

Unlike Gauer and English, Miasek believes the costs of the Highway 427 expansion project -- which added 6.6 kilometres of new highway to the 427 running north toward where the 413 is planned, widened four kilometres of the existing highway north of Toronto’s Pearson International Airport, and added new median high-occupancy toll lanes in each direction -- is the best comparator to use in trying to establish costs for the 413.

In Miasek’s view, the 407 extension is not a great comparator for the 413, as much of the 407 extension was built through undeveloped lands, whereas lengthy sections of the 413 would be built adjacent to and possibly through densely populated and fast-growing urban developments in Brampton, southern Caledon and Vaughan. “In addition,” Miasek adds, “the 407 extension is a toll road, which reduces net operating and maintenance costs.”

But, as Gauer notes, the 407 extension did not involve the expensive complexities of refashioning an existing highway.

Because the 427 expansion runs through fast-developing terrain north of Pearson airport, and because it included widening expenses and a greater density of interchanges, its cost -- which totalled $687 million in 2017 dollars -- proved far higher on a per-kilometre basis than the 407 extension.

“Although the final contract is on the Infrastructure Ontario website,” Miasek notes, “the costs are redacted. However, communication with the project team indicates that about half was for construction, and the other half for maintenance and rehabilitation over a 30-year period.”

Highway 413 is about five times longer than the Highway 427 project, Miasek says. So, based on his math, he believes total costs to construct and maintain Highway 413 will come in at around $8.6 billion.

It would be far more prudent for the province to pay subsidies for trucks to use the 407 toll road than to build the 413, he believes.

“Better use of the existing 407 is the way to go, not just from a financial perspective, but also for transportation planning and environmental protection reasons,” says Miasek.

It’s a file that Ontario Liberal Leader Steven Del Duca knows well: In 2018, while serving as transportation minister in the previous provincial government, Del Duca shelved the 413, at the urging of an expert panel who largely agreed with Miasek’s basic reasoning.

Last February, Del Duca told the Star via email he will shelve the 413 again if he’s elected premier.

In a recent email interview, Del Duca says specific construction costs were never discussed with him when he was minister.

“The public service only provided rough estimates of $6 billion as a placeholder,” he says. “It’s impossible to know for certain, but in my experience, these costs would have ballooned substantially in the time since I was last briefed on this in 2017. My best guess is that this project would be $10 billion at a minimum at this time.”

Asked whether he feels the public has a right to know the government’s current cost estimates for the 413, Del Duca’s response is blunt.

“Yes, absolutely.”