The 188-page report by former councillor Gordon Chong is not a financing plan he calls it an interim report while noting that Toronto Transit Infrastructure Ltd. revived by Ford had a modest $100,000 budget.
Rather, it is a unabashedly political argument for the superiority of subways over surface light rail transit; a history of proposals for subways on Sheppard that draw exhaustively from a 20-year-old environmental assessment; and a list of possible revenue tools to build the line. Projected revenues from these tools are in the billions of dollars over the next 50 years.
As descriptions and excerpts leaked out Thursday, councillors opposed to Fords subway-centric vision blasted the report, saying it appears biased and based on unreliable financial predictions using options that Ford has categorically rejected.
Chong commissioned management consultants KPMG to assess the financial case for building an 11-station line from Downsview to Scarborough Town Centre primarily with private-sector investment.
KPMG concluded that funding and financing for the Sheppard subway extension is feasible, the report says.
Policy/legislative support of council and the province would be required
Detailed analysis by KPMG of three revenue tools tax increment financing (TIF), development charges (DC) and city-owned property rights illustrate that a large revenue pool is available to finance construction of the Sheppard subway.
But the report makes it clear the line estimated by the TTC to cost $4.7 billion, while Chong sides with a $3.7 billion estimate from the provincial Metrolinx agency wont be built without a combination of other revenue tools. Those suggested are almost all toxic to Fords low-tax, car-friendly ethos, or out of the citys power to impose.
The options include road pricing (zone-based tolls, expressway tolls, high occupancy toll lanes and vehicle-kilometre-travelled fees); parking pricing (parking sales tax; parking space levy); a special regional sales tax; a special gas tax; a passenger vehicle charge and a employee/payroll tax.
TTIL argues that it should be transformed from a Ford-created shoestring operation into a standalone independent corporation with an initial $10 million budget in full control of Toronto subway expansion. The TTC would be cut out of transit building and planning altogether.
Independence would insulate the organization from short-term political change at all three levels of government, the report states as battle rages at city hall between Ford and his council allies and councillors opposed to his plan to completely bury the provincially funded Eglinton line.
As expected, the report says the line should be built through a public-private-partnership, or P3, model.
It favours a P3 availability model that it says would see the city put up little or no cash until years into construction, with seed money coming from private investors and the provincial and federal government. The projections assume Ottawa will deliver on its pledge of $330 million for the Sheppard line and that the province will deliver fully on up to $650 million in potential surplus funds from construction of the Eglinton line.
The analysis demonstrates that partnering with the private sector will dramatically improve the citys ability to finance the project during the construction period
, the report states.
Alternative construction and procurement approaches offer the potential for the city to save the taxpayer hundreds of millions of dollars and accelerate Sheppard subway project completion.
Josh Matlow, a centrist councillor among an apparent majority who want some of the Eglinton line brought to the surface to free up money for other lines, including a possible city-funded start to the Sheppard extension, predicted Chongs report will not be a major factor in Torontos transit planning.
We cant deal with maybes and possibles and options that might come to fruition, said Matlow, noting Ford rejected his proposal to consider tolls on the Gardiner Expressway and Don Valley Parkway to help fund transit. This is not a reasonable, responsible way to plan a transit. Any businessman can see that.
The mayor had many opportunities to work with colleagues to work on a plan we can move forward on. He has rejected it and now he has missed the train.
