On the TTC Board agenda for April 11, 2024, a long report describes the TTC’s 2024 Asset Management Plan. This document has been in the works for some time. It arises from an Ontario Regulation in 2017 and a City Council Corporate Asset Management Policy adopted in 2019 whose intent is that there is long term sustainability and accountability for City assets. The TTC as a local Board of the City is subject to this policy.
This is a long article reviewing an even longer document. For a general overview, some readers may prefer to stop at the break just before the chart of “condition scores”. The remainder of the article reviews some of the detail in the Plan, its strengths and shortcomings.
General Observations
Although the document gives a unified impression in its design, it was produced with information from many sources in the TTC. Some of these, notably for the streetcar system, betray unfamiliarity with various assets, or a sloppiness in editing. Some information is dated and reflects conditions a year or more ago with little or no mention of works in progress and how they would affect the review. Any future budget planning must be based on current, accurate data.
As with so much information reported by the TTC, far too many data are reported as overall averages without the granularity needed to flag key problems. Some projects risks are described as if no work has been done when in fact they might be well on the way to completion. Was it just too much trouble to accurately portray the state of some assets? That is troubling in the context of other events throwing the TTC’s ongoing maintenance practices into question.
One section of the Plan deals with “systems” which, in many cases, are networks of devices. A failure within a system does not necessarily affect just one part, but can have a farther reach as seen in the recent fire near Islington Station. Moving up a level from that, the Plan is divided into major topic areas, and several of these are related although the plan treats them as separate entities. This subdivision is, in part, dictated by Provincial Regulation.
Trains need cars, but they also need track and power, not to mention stations. It is important to see the transit network both as a complex collection but also at the detailed level. One thing the Plan does is provide a tutorial for those who only know part of the system, notably the politicians responsible for funding transit and choosing its goals.
An important part of any asset plan is the recognition of alternate futures depending on what is done, or more critically not done, in the short-to-medium term. The cumulative effect of deferred work during economic downturns is not immediately apparent, but can create a backlog requiring significant effort and spending just to get back to “normal” conditions. If deferrals last long enough, they affect corporate culture and become the accepted way of doing business. An organization can forget what proper asset management and maintenance look like after years of aiming for a too-low target.
Funding partners grouse about above-inflation cost growth when their own penny-pinching, coupled with management making the best of a bad situation, created the situation in the first place. It is important to recognize the difference between higher costs through factors like materials and labour, and higher spending required to reverse a backlog of overdue work and restore the system to good, steady-state condition.
An issue that appears in several parts of the Plan is the effect of vehicle electrification. This touches the bus fleet and related maintenance and charging facilities, and the non-revenue fleet. The change in propulsion and control technology affects maintenance workers who must adapt and be trained, as well as the equipment needed to support an electric fleet. Electrification is not just a matter of buying a new style of bus, but a pervasive change in a large part of TTC operations that will extend over a decade.
We may reach a point where diesel-hybrids are regarded as a minor “legacy” fleet from days gone by, but that time is a long way off. Co-existence of two modes will continue for many years.
The City has contemplated but not yet adopted a long-range goal not just to fully electrify transit operations, but to very substantially increase service levels. This would have a pervasive effect on the entire asset base, staffing and future budgets. The Plan includes an overview of proposed rapid transit expansion, but there is no discussion of the service increase scheme.
Overview
The 2024 Plan sets out the TTC’s many classes of assets, their condition, ongoing maintenance and replacement cycle and some information on cost. This leans heavily to the Capital side of TTC budgeting and the large known shortfall in committed and likely funding over the next 15 years. Some information is incomplete because the TTC data collection is still underway.
While this Asset Management Plan meets the requirements of the Regulation for 2024, the next phase of compliance, due on July 1, 2025, requires the TTC to have a financial plan that identifies the funding needs to ensure all assets the funding to ensure all assets are maintained in a state of good repair to meet future levels of service. The 2025 Asset Management Plan will also further inform the preparation of the TTC’s Capital Investment Plan (CIP). The TTC’s 2024-2038 CIP has identified a total of $47.855 billion in base capital needs over a 15-year period, of which $12.398 billion is funded, leaving $35.457 billion in unfunded capital needs.
2024 Asset Management Plan, Covering Report at p. 7
That paragraph does not break out “State of Good Repair” (SOGR) items from the overall budget, and yet that will be essential in deciding where to allocate available money. Moreover, the focus here is on Capital with no mention of day-to-day maintenance funded from the Operating budget.
A sense of the TTC’s scale is given early in the Plan:
The scope of assets that the TTC owns and manages is large and varied, and comprises of the vehicles, infrastructure, facilities and support systems necessary to operate and maintain the TTC’s bus, subway and streetcar services. The asset inventory changes regularly as new assets are commissioned and older assets are decommissioned at the end of life.
The vehicle fleet consists of 2,572 accessible buses (including 250 paratransit Wheel-Trans buses), 204 streetcars and 143 subway trains, with the fleet and other asset classes supported by more than 900 non-revenue vehicles. There are a further 6,400 small and 1,900 large items of industrial equipment, which support the maintenance of TTC assets.
The TTC maintains more than 70 kilometres of mainline subway track across three active lines (following the decommissioning of Line 3 in 2023) and 388 kilometres of Streetcar Way. Streetcars are powered by 454 kilometres of overhead/traction power feeders and 368 kilometres of overhead contact system.
Across the subway and streetcar network, the TTC is responsible for the maintenance of 77 box structures, 43 bored tunnels, 75 bridges, four culverts, 170 retaining walls and 474 miscellaneous structures. In addition there are 38 overhead structures that are maintained by the City. The Prince Edward Viaduct is jointly maintained by the TTC and the City.
The vehicle fleet is stored, maintained and operated from 22 separate facilities located across the TTC network, which include garages, carhouses, yards, and shops. There are also 58 substations to support movement of fleet and provide power to the facilities. Across the subway network (including the now decommissioned Line 3), there are 75 subway stations with 164 elevators and 329 escalators moving both passengers and freight. The TTC also maintains more than 9,500 bus and streetcar stops/shelters, alongside two bus terminals and nine Wheel-Trans hubs.
Corporate and professional services also operate from five administrative buildings across the city, and the TTC maintains 29 other buildings, including emergency service buildings, operator convenience and waiting rooms, as well as a number of parking lots.
Operation of transit services across all three transportation modes is facilitated and supported by communication, signalling, electrical and mechanical systems. These systems are made up of many thousands of individual assets, with further details contained in the relevant sections of this Plan.
TTC Asset Management Plan 2024 at p. 7
Assets are divided into five classes as specified by the Regulation, and their total replacement cost is $25.1 billion. They vary quite substantially in age with some being over a century old (early streetcar facilities) to quite recent. The condition of each class also varies.
Considering the known cost of projects now planned and in progress, to the degree these are revealed, these numbers could well understate the true replacement costs. A related complication is the ownership of some assets by Metrolinx, but their operation as part of the TTC network.
Some assets are consolidated in this table in part because the source data are in insurance reports organized for that purpose. For example, IT Systems are included under the contents of Facilities, not under Systems. However, there is no detailed review in the Plan of IT systems, their age and technology, nor of their need for “state of good repair”.
Class | Replacement Cost ($ billion) | Condition | |
---|---|---|---|
Fleet | Revenue vehicles (buses, streetcars, subway trains), non-revenue vehicles, and the industrial equipment used to service those vehicles. | $7.1 | 2.1 (Good) to 3.7 (Adequate) |
Linear Infrastructure | Subway track, Streetcar track and overhead power. | $2.8 | 1.0 (Excellent) to 4.0 (Marginal) |
Facilities | Storage and Maintenance facilities, subway stations, administrative buildings; bus and streetcar stops. | $5.0 | Unknown – Not enough data exists to provide a rating. |
Systems | Communications systems, signals, electrical systems, and mechanical systems. | $1.1 | 1.0 (Excellent) to 5.0 (Critical/Poor) |
Structures | Box structures, bored tunnels, stations, bridges, Prince Edward Viaduct (track beams and sidewalks), culverts, retaining walls, and miscellaneous structures. | $9.1 | Very Good to Very Poor |
Total | $25.1 |
Of particular interest in this list is the group Structures which holds over one third of the replacement value for the system. This is rarely mentioned in funding and priority debates, in part because much in this category has a very long lifespan. However, as the subway ages, proportionately more structures enter a period where preventative maintenance is essential, and in some cases major reconstruction is needed. (This is a separate systemic issue from basic problems of new subways with water penetration and other faults from the day they open.)
A second group, Facilities, includes the above ground part of the system and, like Structures comprises many assets with long lifespans such as buildings. These too have ongoing preventative maintenance needs but with a lower profile than new trains or signals, let alone new lines, for funding.
Much recent discussion of State of Good Repair focused on the Capital Budget and shortfall, but substantial day-to-day work is required to keep various assets in good shape. A shortfall in the Plan is a sense of the cost, adequacy or funding of this work even though it is integral to preventing a decline in asset quality. This ties into recent discussions about system maintenance.
Life cycle activities and the point at which they occur vary between assets according to their inherent nature, the required level of service, their operating context, use and condition. As assets approach the end of their serviceable life, life extension programs may also be implemented to prolong service life ahead of replacement or renewal. However, it should be noted that as assets near the end of service life, the maintenance cost will increase significantly. Details of the life cycle activities applicable to each asset class and the sub-assets within each class are contained in the relevant sections of the attached plan.
2024 Asset Management Plan, Covering Report at p. 6
Under each subclass of assets, there is a discussion of related risks. These show how some aspects of any Plan and Budget are related, although generally at a time frame where effects are not immediately obvious. For example, if the average age of a fleet rises, then more running maintenance is needed plus a life extension program. This affects both the Capital and Operating Budgets.
Because subsidy arrangements for these budgets differ, avoidance of Capital spending might trigger a rise in Operating spending at a higher rate for the City (or higher fares) because a lower proportion of the Operating Budget comes from other governments. However, at the local level, the temptation to “make do” can lead to declining maintenance, reliability and service.
The 2024 AMP, prepared in accordance with the requirements of O. Reg. 588/17, affirms that an estimated 50% or $12.6 billion of TTC assets are entering, or in some cases, are well into their twilight years.
If half of the assets are “well into their twilight years”, this is not an overnight change, but rather the effect of many years of deferred maintenance and replacement. This is particularly true of the subway network which was once brand new and required less maintenance, let alone replacement of major components. However, as infrastructure ages, it can move “into the twilight” with ongoing plans and budgets based on earlier years.
Proper funding should not just maintain the existing rate but grow to reduce and keep overall asset ages within a range of reliable service.
Particular concern over the lack of funding for state of good repair applies currently to:
- Line 2 Bloor-Danforth subway elements (power, signals, communications systems, and vehicles) that are at/or approaching end of life.
- Facilities maintenance of garages, yards, carhouses and various other buildings (HVAC, roofs, structures, elevators, escalators, and plumbing).
- Bus fleet with the majority now over halfway through its lifecycle.
The streetcar network will predictably be at risk within five to 10 years without capital funding commitments for rehabilitation.
2024 Asset Management Plan, Covering Report at p. 7
Overall funding, of course, must respond to both the existing system and service as well as growth. Discussions of “growth” focus politically on major new rapid transit lines, but this can sideline plans and funding for general increase in service quantity and quality across the network.
An important part of any Asset Management Plan will be recognition of future costs that will be triggered by system expansion of both rapid transit and surface networks. Only two years ago, Toronto agreed to take on the operating and non-lifecycle costs of the Eglinton line, but that did not last. In the short term, the Toronto-Ontario “new deal” includes funding for operation and maintenance of Lines 5 and 6, but not for expansion of the existing service.
The TTC has many plans, but several of these tie back to the Annual and 5-Year Service Plans. After all, it is mobility and hence service that the TTC provides, and medium to long range aspirations for service affect the entire organization. Service might sit an the heart of the chart below, but one would be hard-pressed to see this in a typical debate at the TTC Board or Council.
Over the years, a troubling aspect of TTC debates is that “service” comes last in the discussions and is always “subject to budget availability”. Rarely is there an aspirational view of the transit network and its future. A desire for more service can run headlong into the currently planned level of fleet and facilities growth.
Attempts to engage in such discussions trigger rounds of “we can’t afford it” or “not now, maybe later” that hamper a strategic approach to all TTC planning. The lead times to scale up parts of the system require sustained commitment. It is ironic that we are willing to wait a decade and more to get a new rapid transit line, but will not invest in the short term to enhance and expand the existing system.
The Plan’s primary function is asset management. It is not a forward planning document to pursue “what if” questions about possible transit futures, although it does acknowledge that current plans have implications. Only recently did Council grasp the effect of getting many new rapid transit lines built by Ontario, but with the expectation of local funding for operations. The Ontario-Toronto “new deal” delayed, but did not eliminate this problem. Running more service and maintaining more infrastructure costs money that fares will not cover.
Continue readingLevel of Service
In 2013, the TTC introduced its first 5-Year Corporate Plan with the vision: To be a transit system that makes Toronto proud. The next 5-Year Corporate Plan is due to be published in 2024 and forms part of an integrated planning and performance framework the TTC utilizes. This framework demonstrates how the goals, objectives and intended outcomes of the TTC can be achieved through the alignment of key business planning activities. In addition, the 5-Year Service Plan & 10-Year Outlook (2020-2024) identifies service-related improvements to public transit service in the city of Toronto. An updated version (2024-2028) is expected to be published in 2024.
The Service Plan also identify [sic] how the TTC is responding to growth requirements, meeting the challenges of changing ridership demands and meeting the financial challenges of maintaining existing service levels and upholding the state of good repair. Given the significant pending growth in the size of the transit portfolio, it should be noted that there will be an increase in funding pressure to sustain the existing level of service for the asset portfolio.
2024 Asset Management Plan, Covering Report at p. 5