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Toronto transit plan clears major hurdle at council

Mayor John Tory framed the agreement as council taking decisive action on building transit
Nov. 8, 2016
By Ben Spurr

Mayor John Tory’s signature rail plan cleared a major hurdle on Tuesday, as council rejected an attempt to delay its approval and endorsed a controversial agreement with the province to advance its completion.

The terms of the agreement, which passed with the support of three quarters of council, set out cost-sharing arrangements between the city and the Ontario government for more than $11 billion worth of transit projects, including planned LRT lines and a scaled down version of the SmartTrack proposal Tory promised during the campaign.

The mayor framed the agreement as council taking decisive action on building transit.

“I think it’s a great deal. It’s going to produce transit for people sooner than anything else, it’s going to make the biggest difference the soonest of anything else we can do,” he told council before the vote.

The decision means the city will be responsible for the capital costs of building SmartTrack, estimated at $3.7 billion, and comes just three weeks before a Nov. 30 deadline set by the province.

But during a debate that stretched over nine hours, some councillors said they didn’t have enough information to approve the proposed agreement. Details of the terms were only released last week and the deal potentially puts the city on the hook for billions of dollars in future transit costs with no clear funding source.

Councillor Janet Davis (Ward 31, Beaches - East York), moved a motion to defer approval of the agreement until council’s February meeting, when councillors will finalize the city’s 2017 budget. She argued that would allow council to weigh in on city reports, anticipated in the coming weeks, that will outline new revenue tools and potential asset sales that could raise funding for transit.

Davis said that if the province wouldn’t allow a delay “then there’s something really wrong with this partnership.”

“What this says is hold on, we have timelines and processes here too, we are a level of government, and we need to consider this in the context of our budget,” she said.

Davis and others raised concerns about whether tax increment financing, an untested method of tapping anticipated taxes from future development to pay for infrastructure projects, could be used to cover a large portion of the SmartTrack costs, as the approved plan recommends.

They also cited uncertainty around the fare prices and ridership projections for SmartTrack. Neither has been finalized but both are crucial to the project providing the benefits to the city’s transit network that Tory has claimed.

But other council members warned that delaying the vote to next year would cause the province to cancel the deal and it was better to push ahead.

“Remember this - we are not a level of government. The province controls this level, they tell us what the deal is,” said Councillor Frank Di Giorgio (Ward 12, York South-Weston). “They put deadlines on us … They control the nature of the deal we will ultimately get.”

Davis’s motion failed 11 to 32.

The $3.7 billion in estimated SmartTrack capital costs includes $1.3 billion for six stations branded as SmartTrack stops on the Stouffville/Lakeshore East and Kitchener GO corridors, down from the 13 new stations he promised during his campaign. It also includes $2.5 billion for the Eglinton West LRT, which would run between Mount Dennis station on the Eglinton Crosstown and Pearson Airport.

The city is hoping to secure funding from the federal government and other jurisdictions to lower its SmartTrack costs to $2 billion. The province is spending $3.7 billion on the GO network within Toronto to support RER.

Amidst a flurry of motions at the end of the debate, council rejected an attempt by Councillor John Campbell to delay approval of the Eglinton West LRT. Campbell, who represents the Etobicoke Centre ward that would be served by the project, noted that the extension wasn’t high on the list of transit priorities compiled by the city’s planning department, and argued the money would be better spent on building waterfront transit. His motion lost 10 to 32.

In addition to taking on the costs associated with building SmartTrack, the deal approved by council also committed the city to paying $71 million for SmartTrack planning over the next two years, and an additional $217.5 million for infrastructure to support GO service.

Council also agreed to pay all of the operating and regular maintenance costs for provincially funded LRT lines that are either planned or already under construction on Eglinton, Finch West, and Sheppard East, as well as operating and maintenance costs for RER service to SmartTrack stations. It’s not clear how much the operating and maintenance costs for the projects will be, or how the city will pay for them.

Some councillors were adamant that the city not agree to take on the LRT operating costs. As the Star reported on Tuesday, a 2013 provincial document suggested the province assumed it would pay at least some operating costs for new LRTs in the city.

City manager Peter Wallace told council that Toronto taking on the LRT operating costs was a “precondition” set out by the province during negotiations for the new agreement.

Councillor Glenn De Baeremaeker (Ward 38, Scarborough Centre), a proponent of the transit agreement, said that council couldn’t allow uncertainty about the details to prevent it from moving ahead.

“You sometimes have to move forward even when everything isn’t 100 per cent guaranteed or perfect,” he said. “You just don’t know those answers yet. But what we do know is our city needs SmartTrack.”