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TTC's $17.4M deficit could force fare hikes

Last Updated: Wednesday, September 23, 2009 | 8:26 PM ET
CBC News

Fare hikes may be needed to address the TTC’s growing deficit, which hit $17.4 million this year and could more than quadruple in 2010, officials say.

The Toronto Transit Commission pins most of the blame for the deficit on the popularity of transferable Metropass, which allows riders unlimited travel.

The pass costs most adults $109 a month, which regular users may find cheaper than paying for full-price tokens and tickets.

“We anticipated that the Metropass … was going to cost us money, so that was already in the budget, but we didn’t think it would be as successful as it has been,” said Coun. Joe Mihevc, who is also the vice-chairman of the TTC.

The success of the Metropass has cost the transit system an average of three cents a ride, which has hit revenues — projected at just over $900 million for 2009 — and contributed directly to the deficit.

The TTC will cancel some planned service expansions, review hiring and curtail overtime to offset some of the deficit this year, said general manager Gary Webster.

Widening budget gap

Those changes will not fully bridge the budget gap, however, as it widens next year.

“For 2010, we will be $80 million in the hole, given all the different pressures around gas [and] increased wages for the employees based on a contract that was negotiated a few years ago,” Mihevc told CBC News.

He didn’t say how those pressures would be addressed.

Unless the province or federal government provide money to run the growing system, a fare increase is inevitable, said Coun. Shelley Carroll, the TTC’s budget chair.

“They like to build the toys, build the systems and say: ‘We built that thing over there,’” she said, referring to the provincial and federal governments. “But it’s the city that has to put the buses and drivers on the road.|

Mayor David Miller pledged last December not to raise fares for 12 months but has made no commitment beyond that.

It could also be politically unfavourable for Miller to implement a fare increase next year, when Torontonians will vote in municipal elections.