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Letter to the Editor - W.A. Edwards, Mayor, Mimico.

Yonge Street Subway has not been financially self-sustaining and has been subsidized by surface-line revenue ever since it began operation. Toronto Transit surface lines have been highly profitable, more particularly since fares were fares were increased to 12½ cents 27 months ago.

The Toronto Transit system made $2,344,080 profit during the year 1957, which is $194,507 per month. Since fares were increased on July 1, 1956, is is reasonable to assume the system has made $5,250,000 profit, and profits continue accumulating. Why drag taxpayers into transit affairs now?

Much indicates the Metropolitan Council has become confused over this “losing” subway and “profitable” surface-line condition. In any event, the Council would coerce taxpayers into a most confusing transit transaction. The Metro Council would finance the proposed Bloor-University Subway as follows:

By tax levies (2 mills, 10 years) $ 80,000,000 
By property sales .................. 7,000,000 
By debenture loans ............... 113,000,000 
                                  ------------ 
Total ........................... $200,000,000

Note as follows: 1. It requires 10 years to build the proposed subway: to spend $200,000,000. 2. During that 10 years, taxpayers pay $80,000,000 cash: the Toronto Transit Commission pays nothing. All the remaining financing is by debenture loans and property sales. 3. Included in the $113,000,000 debenture loan is $11,000,000 to pay interest on the remaining $102,000,000, which is the opposite extreme to cash financing. 4. At the end of 10 years, we can assume the situation will be reviewed and instead of the two-mill levy being discontinued, it will continue on, and pay the debentures. In other words, taxpayers having paid $80,000,000 cash, will begin to pay debt charges on the remaining $113,000,000. They will pay the whole subway cost.

This subway transaction is timed so that all financing is by loans, until the taxpayers’ two mills for 10 years is paid. Then the taxpayers can by debt charges on the loans. That is astute TTC financing at the expense of taxpayers. The proposal, if adopted, will cost Toronto taxpayers $3,500,000 per year and three Lakeshore municipalities $160,000 per year. The Lakeshore groups pay double fares. The surface lines have subsidized and will subsidize subways; those who pay double fares pay double subsidies.

To summarize the proposal: Lakeshore taxpayers are to pay $160,000 per year cash, plus double fares and subsidies, to build a subway on Bloor Street and enable subway passengers to ride for a single fare. That transaction is just not acceptable, and should be changed. If the Metropolitan Council finally adopts such a proposal at the expense of all Metropolitan, including Toronto, then the two-mill levy will be a bone of contention in each ensuing budget debate; such subway financing will leave the Lakeshore facing some very dark clouds.

—W.A. Edwards, Mayor, Mimico.




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