From the beginning, Stintz and de Baeremaeker sought to minimize the additional expense, claiming that a subway was only $500 million more than the $1.8 billion LRT (for a total of $2.3 billion). By June 2013, according to briefing notes obtained by Spacing, Metrolinx officials, in discussions with the City and the ministry of transportation (MTO), were pegging the additional costs at $925 million, meaning a subway would cost $2.7 billion.
But that $925 million may have been a low-ball estimate. Spacing obtained a May, 2013, “business case analysis,” prepared by John Howe, Metrolinx’s vice-president for investment strategy and sent to two senior provincial officials, Carol Layton and David Black, on June 28, 2013. It suggests the $3 billion overall subway cost estimate may fall hundreds of millions of dollars short of the mark. (Howe oversaw the Metrolinx effort to find new revenue tools to fund The Big Move.)
“The subway is at a very preliminary (pre-EA) design stage and therefore it is prudent to apply an optimism bias uplift, typically + 40% to 50% for Capital cost estimates,” the memo explains. “A lower rate of optimism bias uplift is applicable to the LRT scheme, reflecting a much more advanced status of the designs. Applying 45% optimism bias for the subway scheme and 12% optimism bias for the LRT scheme, a cost differential of $1.5 billion is derived.”
In other words, since the subway plans are very preliminary, the amount by which its costs might exceed the current estimate is much higher than for the well-developed LRT plans. That means that, once all the real-world expenses are tallied up, the subway could end up costing as much as $3.3 billion. According to the briefing note, that number doesn’t even include a range of other expenses, nor does it account for the fact that the original allocations are given in 2011 dollars.
Howe’s memo also outlined a range of other concerns relating to capital costs, operating implications and construction risk. Written well before council and the province hammered out a deal, this document is the clearest articulation of Metrolinx’s reservations about the proposed change in direction.
What’s more, the fact that these concerns were communicated to senior provincial officials in late June, 2013 indicates that Murray’s office would have — or should have — known about the financial analysis. There’s nothing on the record to indicate, however, that Murray publicly discussed the total possible cost, much of which would be born by Toronto taxpayers.
LOW RIDERSHIP PREDICTION
In addition to the costs issue, the Metrolinx memo addressed the problem of expected ridership. The travel forecast for 2031 on the Scarborough RT corridor shows a “maximum flow” of approximately 11,000 passengers per peak direction per hour. That figure is not even half of a subway’s capacity (25,000 passengers), and less than the LRT capacity of 15,000 passengers. “It is therefore concluded that the additional capacity of subway technology is not required and does not add value to the scheme,” the memo stated. “This initial assessment suggests the volume of benefit likely required to justify the switch to subway construction will not be generated and the switch would not represent good value for money.
“While further analysis could create a more definitive statement,” the memo continued, “preliminary analysis indicates that the subway scheme will not represent a good use of public investment dollars….”
The Metrolinx memo also had warnings about the risk of further delay — as much as six years — given the current state of the Scarborough RT. “The SRT is considered life expired by the TTC who [sic] describe the state of the infrastructure and the vehicles as ‘approaching critical.’ It may therefore be necessary to provide bus replacement service for the SRT during all or part of this six year period.”
On the question of connecting transit investment to planning goals, the Metrolinx memo observes that new subway stations on the Scarborough line at Sheppard and McCowan, and Lawrence and McCowan “provide little or no opportunity to intensify land use in the vicinity of these stations, negating the potential to support provincial TOD [transit-oriented development] policies and to create growth nodes around these major transit interchange facilities.”
Finally, Howe flagged other significant cost question marks:
The realignment of the line [PDF] under Scarborough Town Centre — the subway will pass beneath the mall whereas the LRT would have skirted to the south of the property — “is likely to be costly and will inconvenience users of the existing McCowan SRT station”;
“The subway option is likely to eliminate the possibility of an extension of this corridor to Malvern Town Centre in the long term;”
If the new GO interchange at Kennedy station becomes more popular with people traveling downtown, “the benefit of providing through service [on] the Bloor-Danforth subway to Scarborough…would diminish.”
“At this stage,” the Metrolinx memo warned MTO, “no further work to quantify or monetize these issues has been undertaken.”
