York Region’s tab to keep Vaughan subway on track could hit $92M more

YorkRegion.com
April 2, 2015
Lisa Queen

Despite qualms from some that they were being railroaded into making a quick decision, York Region councillors have agreed the region is on the hook for as much as $92 million in additional funding to complete the extension of the Spadina subway.

Of the $150 million in extra funding needed to cover the delay, now estimated to be completed in December 2017, the region’s share is $60 million and Toronto’s share is $90 million, although local politicians are asking the provincial and federal governments to kick in more money.

York’s share is in addition to the $351.6 million it was already paying toward the project.

Regional council, which approved the $60 million last week after holding part of the discussion in private session, will determine how to bankroll its share during next year’s budget process.

At the moment, CAO Bruce Macgregor and Treasurer Bill Hughes indicated 74 per cent of the region’s share is expected to come from development charges, with the rest being funded through property taxes, although it is anticipated there may be enough money in a reserve account to ensure taxes don’t have to increase.

The region could also be responsible for $32 million due to a shortfall in the Provincial Move Ontario Trust.

When the Ontario government said it would contribute $1.059 billion to the subway extension, about 40 per cent of the project, it actually only put in $870 million.

The funds were put into the trust and the province counted on it earning 4 per cent in interest to make up the difference.

But lagging market conditions since then have resulted in an $80-million to $85-million shortfall.

Although regional councillors are upset with the region’s $60 million share to cover the delay of the subway extension, they argued the project must be completed.

“It’s black and white. You’re either in or you’re out and I think this council is in,” Vaughan Mayor Maurizio Bevilacqua said. “This is an anchor, not just for the city of Vaughan, but for the region. There are many, many reasons why we agreed many years ago to pursue the subway.”

But while other councillors said they support funding the subway’s completion, they complained they felt pressured into making a snap decision less than a week after news broke about the additional funding needed to cover the delay and when they had no time to digest information about the impact on York Region.

“Obviously, this is fairly concerning to everybody and an unpleasant surprise. I would love to have more than a very brief amount of time to absorb all of this and understand it and dig into it further,” Newmarket Councillor John Taylor said.

“I, for one, would be a little bit more comfortable with a week or two to digest what is a $92-million hit.”

Richmond Hill Councillor Vito Spatafora, chairperson of the transportation committee, agreed.

“I don’t want to jump from the frying pan into the fire. I know we’re in the frying pan,” he said.

While the region has a commitment to complete the subway, councillors haven’t had time to analyse funding models, Spatafora said.

Delaying approval of the region’s funding for any significant length of time could result in not meeting the new December 2017 completion date, Macgregor said.

There has also been “a fundamental shift in the oversight of the project,” although the TTC remains in control, he added.

It’s important the region bite the bullet and pay its additional share to ensure the project moves forward right away, Bevilacqua said.

“I think one of the things we learn in life is whenever we enter into a partnership, business, personal or otherwise, we always share in the risk and benefits of it and sometimes things go well and sometimes things don’t go well, but that’s what happens in partnerships,” he said.

“I don’t think there’s anybody on this council that is happy with the delay. I don’t think there’s anybody on this council that is happy with the prospects of paying extra millions of dollars more for this project. That’s understood. But the train has left the station on this and we need to make sure we’re still participating in this project.”

The region must make it clear it will only be satisfied with the full extension of the subway to Vaughan, Markham Councillor Jack Heath said.

Any attempt to open only a portion of the subway in Toronto would change the partnership, he said.