Derail the Scarborough subway plan

The province’s new plan for a subway in Scarborough would result in a white elephant project leading to higher fares and less reliable service.

Ontario Transportation Minister Glen Murray has offered yet another example of how to build a white elephant project. The end result will be higher fares for transit riders in Toronto and increased taxes.

Last week Murray announced – to the chagrin of transit riders and politicians alike – a plan for a new subway route in Scarborough. Rather than the more than $3-billion subway proposed by the City of Toronto, Murray said the provincial government is willing to pay for a $1.4-billion subway extension from Kennedy Station to Scarborough City Centre.

The new plan would build a subway along the same route as the aging Scarborough Rapid Transit line and would come with a “minimum” of two stops, according to Murray – never mind that the Toronto Transit Commission (TTC) has admitted that such an extension would be unfeasible due to a tight turn in the design.

But more important is that neither the subway proposed by the provincial government nor that proposed by the City is needed. Both would add far too much capacity and are based on optimistic ridership projections, meaning they would require subsidies.

The TTC admitted as much in previous presentations to politicians.

A subway that continued past Kennedy station and up to Sheppard Avenue – which is further than the two-station line proposed by Murray – would be able to carry as many as 30,000 passengers per hour per direction (pphpd), the TTC admitted in a report to City Hall. Yet, the TTC estimates that even with that longer line, ridership would only amount to 9,500 pphpd in 2031 during the busiest hour of travel.

By that measure, even during the busiest travel periods, more than two-thirds of the subway’s capacity would go unused. During off-peak periods, the spare capacity would be much higher. More recent estimates from the City have upped that ridership figure to 14,000, which would – even on those optimistic figures – mean more than half of the subway’s capacity would go unused during peak travel times.

Officials at City Hall already know as much, admitting that a Scarborough subway will “result in a surplus capacity that may not be required within a reasonable long-term planning horizon.” The subway will also add to the city’s outstanding debt and impact the City’s ability to fund other more vital transit projects, officials warned.

Queens Park says it will spend $1.9 billion (inflation-adjusted, or $1.4 in 2010$) to help build the subway line. Murray expects that will be enough to pay for the new subway, even though it’s well below previous figures.

Officials at City Hall last estimated that the cost of a subway in Scarborough would exceed $3 billion, leaving the City with a $1.3 billion hole to fill. And that’s just the beginning. The TTC admits that the final price tag for the subway could be as much as 30% higher.

City Hall has already called for a property tax hike of as much as 2.4%, matched by an increase on property taxes for businesses equivalent to one-third of that rate, to help pay for the new project – again, based on previous estimates, as the new proposal from Queens Park is light on details on how it plans to build a subway at such a low cost. The rest of the money will come from an increase in development fees. If those additional fees don’t materialize, taxes could rise even further.

But most important is the simple fact that by all measures a subway in Scarborough will be underused and supported through either increases in taxes, fare hikes or cross-subsidies from other more economic routes. It also highlights the danger that politicians can inflict on a transit system.

Brady Yauch is an economist and Executive Director of the Consumer Policy Institute (CPI). You can reach Brady by email at: bradyyauch (at) consumerpolicyinstitute.org

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