TRANSIT-ORIENTED GOVERNANCE: A COMPARISON OF THE IMPACT OF REGIONAL GOVERNMENT STRUCTURES ON PUBLIC TRANSIT USE IN AND VANCOUVER

A Thesis Presented to the Faculty of Architecture, Planning and Preservation COLUMBIA UNIVERSITY

In Partial Fulfillment of the Requirements for the Degree Master of Science in Urban Planning

By

Jake Schabas

May 2012

1

Abstract This thesis explores the relationship between regional government structures in the Toronto and Vancouver metropolitan areas and the development of comparatively high post-war transit use. While local government reforms and the impacts of regional development on transit use following World War II have received much attention in isolation, they have rarely been analyzed together. This paper investigates how the unique regional governance structures in Toronto and Vancouver allowed both cities to counter North American transportation trends by facilitating the creation of policies that favored transit use. By analyzing the historic operating and financial data from the transit agencies in both cities within the context of legislative reforms to local government and the resulting transportation policies, the impact of regional governance structures on transit use is examined. This paper finds that the success of transportation institutions in achieving high regional transit use is closely tied to the extent that local government bodies have fiscal autonomy, jurisdictional flexibility and involve local transit operating knowledge in transportation policy formation. Finally, the cases of Toronto and Vancouver suggest that the presence and long-term sustainability of these three capacities is inversely related to the involvement of senior government in local transportation planning.

2 Acknowledgements I would like to thank my thesis advisor Dr. Elliott Sclar and thesis reader Richard Barone for their direction and feedback throughout this process. In addition, I would like to thank the ten interviewees in Vancouver, Toronto, New York and who were both generous with their time and very receptive to my questioning and data requests. Furthermore, transportation and land use classes taught by Dr. David King were also crucial to the crystallization of my thoughts and investigative methods around this topic. The hospitality provided by Martin and Lucy Peters in Vancouver along with the consistent support offered by my roommates, girlfriend and family also deserve many thanks. This thesis would not be what it is had it not been for these people.

3 Table of Contents List of Exhibits...... 5 Acronyms...... 7 Introduction...... 8 Chapter 1: Background, Theoretical Literature & Methods ...... 12 Institutional Background ...... 12 Literature Review...... 13 Methodology...... 19 Chapter 2: Public Transit in Toronto...... 21 Summary...... 21 Early History: The Toronto Transportation Commission ...... 21 The TTC under Metro: Tough Beginnings ...... 24 The Politics of Subways and the Transition to Subsidies: 1959 to 1970...... 31 “New York run by the Swiss”: 1971 to 1989...... 40 Growing Regional Fragmentation...... 52 The End of an Era: Ridership decline and the dissolution of Metro...... 55 Chapter 3: Transportation in Vancouver: Institutional Innovation...... 61 Summary...... 61 Early History: Cooperative Regional Governance ...... 61 ‘Do it yourself planning:’ Transportation during the 1970s-1990s...... 65 The Provincial Control of Local Transit ...... 67 A Return to Planning: The Creation of a Regional Transportation Authority ...... 71 Ridership Growth and the loss of the Vehicle Levy: 1999 to the present...... 76 Capital Project Problems and Governance Reforms...... 82 Chapter 4: Findings and Recommendations...... 88 Findings...... 88 Recommendations...... 93 Conclusion...... 96 Interview Schedule ...... 97 Bibliography ...... 98 Appendix...... 105

4 List of Exhibits

Exhibit 1: Top Ten North American Census Metropolitan Areas for transit use for the journey to work, 2006/2009...... 10

Exhibit 2: Population change in the Toronto area, 1941-1949 ...... 26

Exhibit 3: Population Distribution in the Toronto Metropolitan Area, 1948...... 26

Exhibit 4: Toronto Transportation Statistics, 1955-1963...... 30

Exhibit 5: TTC Revenues and Expenses, 1962-1970...... 35

Exhibit 6: TTC Ridership, 1960-1970...... 37

Exhibit 7: Population Growth in the Toronto Census Metropolitan Area (CMA)...... 38

Exhibit 8: Planning Jurisdiction and Urbanization, 1969...... 39

Exhibit 9: TTC Operating Statistics, 1971-1986...... 41

Exhibit 10: TTC Revenues versus Labor Costs, 1971-1975...... 44

Exhibit 11: Provincial Public Transit Operating Subsidy, 1976 ...... 45

Exhibit 12: The Spadina Subway Line along the Partially build Spadina Expressway median. ...48

Exhibit 13: St. Clair West Station Intermodal Transfers ...... 50

Exhibit 14: Change in TTC Vehicle Fleet, 1971-1990 ...... 51

Exhibit 15: The Regional Municipalities and Urbanized Area, late 1980s (clockwise, Halton, Peel, York and Durham surround Metropolitan Toronto) ...... 53

Exhibit 16: Vehicles and Person Trips Crossing Metro Boundary, 7:00AM to 7:00PM, Two Way Totals, 1975-1977...... 54

Exhibit 17: Transit Ridership and Population Change in the Greater Toronto Area, 1981-1985/6 ...... 54

Exhibit 18: TTC Ridership and Toronto Employment, 1998-2011 ...... 56

Exhibit 19: TTC Operating and Financial Statistics, 1990-1996 ...... 57

Exhibit 20: Travel Modes in Toronto versus the Greater Toronto and Hamilton Area (GTHA), 1998-2006...... 60

Exhibit 21: Municipalities in the Greater Vancouver Regional District (GVRD)...... 63

Exhibit 22: Regional Districts in British Columbia, 2005 ...... 64

5 Exhibit 23: Skytrain Technology in Vancouver...... 69

Exhibit 24: TransLink Organizational Chart, 2001...... 74

Exhibit 25: TransLink Governance Model, 2001...... 76

Exhibit 26: Public Transit Ridership in GVRD, Linked Trips, 1989-2010 ...... 77

Exhibit 27: TransLink Operating Statistics, 2000-2010...... 78

Exhibit 28: TransLink Revenue Sources as a Share of Total Revenues, 2000-2010...... 81

Exhibit 29: Comparison of Toronto and Vancouver Transit Ridership Growth...... 82

Exhibit 30: Growth in TransLink Passenger Boardings by Mode, 1997-2009...... 83

Exhibit 31: TransLink Governance Structure, 2008 ...... 85

6 Acronyms ALRT – Advanced Light Rapid Transit CMA – Census Metropolitan Area CPR – Common Pool Resources GO Transit – Government of Transit GVRD – Greater Vancouver Regional District LMRPB – The Lower Mainland Regional Planning Board Metro Toronto – The Municipality of Metropolitan Toronto MTART – Metropolitan Toronto and Regional Transportation Study SRT – Scarborough Rapid Transit TTC – The Toronto Transit Commission TransLink – The Greater Vancouver Transportation Authority or GVTA UTDC – Urban Transportation Development Corporation

7 Introduction Local governments are responsible for addressing the transportation concerns of their residents. Filling potholes, setting parking rules, maintaining sidewalks and, often, providing public transportation, are just a few of the key services municipalities regularly deliver. Where municipalities have had less success is in reducing traffic congestion. While the solution to this problem — providing mass transportation services that are a viable alternative to private car travel — is well known, achieving congestion-free roads by providing high quality transit that competes with private auto use has proved unachievable for most North American cities.1 As a result, despite residents clamoring for less gridlock or better public transit services, most metropolitan regions in North America remain car-dependent and stuck in traffic.2 The problem is as much about the failure of many local governments to provide or generate support for mass transit as it is about the unwillingness of senior governments to devolve authority to bodies who wish to implement effective transportation policies. Local governments are at an inherent disadvantage when trying to decrease traffic congestion through improving public transit because they lack the jurisdictional authority and financial capacity to tackle what are essentially regional problems. This has come to light over the last century as urban expansion has spilled over the borders of older central cities, creating politically fragmented but economically linked city-regions dominated by car travel. Private auto use supplanted public transit as the dominant urban transportation mode in large part because networks of roads often built with senior government funds seamlessly connected drivers to destinations all over the region while public transit systems usually remained constrained by municipal boundaries and budgets. As a result, public transit use declined and the automobile became the default mode for metropolitan travel in North American. Why this transition from mass transit to private car use occurred is therefore not merely a question of specific government policies, technological changes or development patterns — although these have surely influenced this shift — but has to do with the structure of local government institutions that existed as this evolution from public to private transportation occurred. Despite this apparent link between the structural limitations of local government and the decline of public transit use, the relationship between governance and transportation outcomes

1 In this paper, the use of “North American cities” refers to urban areas in and the United States. 2 For a full description of the current predicament most North American cities find themselves in, see Anthony Downs, Still Stuck in Traffic: Coping with Peak-Hour Traffic Congestion, (Washington D.C.: Brookings Institution Press, 2003). 8 has received little attention. This is even the case with regional government structures, despite their overt attempt to join municipalities together either to reduce the cost of commonly provided services or tackle problems that extend beyond political boundaries (i.e. air quality, watershed management, transportation, etc.). As a result, there is no theoretical framework for explaining the relationship between local government structures and the performance of public transportation systems. This paper looks to identify the institutional factors that have enabled public transit to make up a significant portion of all regional travel in the greater Toronto and Vancouver regions. In both regions, high transit mode shares were accomplished under unique regional government structures at a time when public transit use in most North American cities was declining as a percentage of all metropolitan travel. For example, ridership in Toronto — which had been under a metropolitan system of government since 1954 — surpassed its post-war peak in 1973 and by 1990 the average city resident made 210 trips on public transit, by far the most number of trips of any North American city. In contrast, transit use in New York City went into steep decline during this period after peaking in 1946, with residents averaging as few as 121 trips by 1980.3 In 1990, transit use was only beginning to recover with the average resident making 155 transit trips, 35 per cent fewer than the average Torontonian made at the time. Similarly large increases in transit use are occurring today in the Vancouver region where a distinctive regional governance structure is currently in place. Since the creation of a locally controlled transit authority in 1999, transit ridership across the metropolitan region has increased at four times the rate of population growth. Between 2000 and 2010 the average resident went from taking only 66 trips on public transit to 93 trips, a 41 per cent increase. At present, the Toronto and Vancouver census metropolitan areas remain leaders in North America for transit use (see Exhibit 1). These transit achievements are of interest to planners and policy-makers not simply because they run counter to the experiences of most North American regions; they also offer insights into how governance arrangements can impact metropolitan transportation mode shares in favor of public transit. This is because in both regions unique metro-wide governance bodies were in place during periods when regional transit ridership grew at unprecedented rates.4 They are therefore the subject of this thesis paper, which asks whether the existence of metropolitan

3 Paul Newman and Jeffrey Kenworthy, “The land use-transport connection: an overview,” Land Use Policy 13:1 (January 1996), 11, 17. 4 Newman and Kenworthy, “The land use-transport connection,” 11. 9 governance structures in Toronto until 1997 and in Vancouver at present have contributed to the high public transit mode shares of these regions today.

Exhibit 1: Top Ten North American Census Metropolitan Areas for transit use for the journey to work, 2006/2009 Rank CMA % Commute by Transit Population 1 New York 30.5 19,069,796 2 Toronto 22.2 5,113,149 3 21.4 3,635,571 4 Ottawa 19.4 1,130,761 5 Vancouver 16.5 2,116,581 6 Calgary 15.6 1,079,310 7 San Francisco 14.6 4,317,853 8 Boston 12.2 4,588,680 9 Chicago 11.5 9,580,609 10 Edmonton 9.7 1,034,945 *Excluding Mexico City Source: American Community Survey 2009, Census Canada 2006

This paper argues that the unique organization of local government directly contributed to the large increases in regional public transit use seen during the 1970s and 1980s in Toronto and from 2000 to the present in Vancouver. This occurred in two critical ways. First, responsibility for public transit service provision was held by a regional government institution with adequate jurisdictional authority and fiscal resources to effectively allow public transit to complete with the car for regional travel. Second, these governance arrangements led to greater local political support for transit, particularly in suburban areas, which ultimately brought greater provincial support through fiscal power or funding for transit. However, the differences between the two governance arrangements also suggest that the sustainability of increasing transit use differs depending on the type of regional government arrangement. In Toronto, the success of its more formal, hierarchical structure of regional government relied heavily on Provincial support for public transit, whereas in Vancouver, a more voluntary and cooperative structure of regional government has proved itself to be less reliant on Provincial government policies for public transit success. Ultimately, both city-regions demonstrate that increasing transit use is closely tied to the extent to which local governments are empowered through legal and fiscal means to implement their own transportation policies. In the following pages, this paper will demonstrate how increases in local government control over public transit service have benefited high transit mode shares in Toronto and

10 Vancouver. Conversely, increased provincial control over transit, except when in support of locally driven goals, will be shown to have negatively affected the long term viability of transit competing with the private automobile for regional travel. This argument is supported by the historical impact of local government reforms on transit use in Toronto and Vancouver. As a result, this paper is as much about the evolution of federalism regarding the changing relationship between municipal and provincial governments as it is about the development of transportation institutions and policies. As a result, a political economy framework highlighting the impact of institutional path dependencies — understood as where decisions are limited by prior decision-making — and principal-agent problems related to multiple levels of government acting with different motivations and with different levels of power. By examining the Toronto and Vancouver regions, this paper demonstrates how the presence and long-term sustainability of local fiscal autonomy, jurisdictional flexibility and the inclusion of local transportation operating knowledge — the three key institutional characteristics needed for high regional transit mode shares — is inversely related to the involvement of senior government in local transportation planning.

11 Chapter 1: Background, Theoretical Literature & Methods

Institutional Background The evolution of public transit institutions as government-owned enterprises has a unique history that in large part explains the service delivery model seen in most North American cities today. At the turn of the 20th century, public transit was provided by private companies under contracts or franchises to local municipalities in dense urban areas where service was profitable. However when local governments saw it in their best interests to exert more influence on these companies — often to control fares or expand services to less dense areas — they were purchased and became publicly run companies. In the second half of the twentieth century, a similar occurrence often took place in many cities where provincial or state governments increased their authority over local transit. This occurred through outright legislative takeovers or indirectly through a reliance on funding from senior levels of government.5 These actions were premised on the idea that municipal governments lacked the jurisdictional authority or resources necessary to effectively deliver public transit services. As a result, many local transit agencies came under the control, either directly through legislation or indirectly through fiscal dependence, of State or Provincial governments. These changes in authority over transit are closely related to larger debates regarding the role of municipalities within a federalist system. Canadian municipalities, similar to their American counterparts, are creatures of their respective provincial governments — a constitutional arrangement that has been in place since the British North America Act, 1867. As a result of this act, municipal governments have responsibility for many services relied upon by residents on a daily basis, yet their legislative authority or fiscal autonomy is strictly defined by their respective provincial governments, meaning they have little legal autonomy in comparison to more senior levels of government. A case in point is public transportation, a highly localized service generally provided by municipalities who often lack the resources or legislative ability to implement new revenue tools to properly operate and expand their transit systems. A question that therefore arises in this investigation is one of subsidiarity;6 namely, what form of

5 A significant difference between the United States and Canada is the role played by the federal government in local transportation funding. Historically, the Canadian federal government has had little involvement in local transportation funding or planning, whereas the opposite is the case in the U.S. 6 Joseph Garcea and Edward C. Lesage Jr. eds. Municipal Reform in Canada: Reconfiguration, Re- Empowerment, and Rebalancing, (2005: Oxford University Press), 31. 12 involvement from each level of government is in the best interests of encouraging public transit use within metropolitan regions?

Literature Review Two long-standing debates related to the question of local government structures and the organization of transit service delivery are informative for this investigation. The first debate is rooted in political science and political economy literature and deals with the preferred institutional structures for delivering “public goods” or managing “common pool resources (CPRs)”; the second debate is grounded in recent transportation research on how the historic development of transportation agencies has influenced current metropolitan travel patterns. Canada is notable for its recent reforms to local government institutions and history of experimentation with regional government models. As a result, much has been written on municipal government in Canada, which can roughly be divided up into two categories: general literature on the foundations and evolution of local government in the ten Canadian provinces7 and more recent writings on the local government reforms of the 1990s and early 2000s.8 Both aim to establish the historical and legal basis for local government in Canada and deal specifically with the responsibilities, constitutional arrangements and legislative reforms that have led to the current organization of services provided by municipalities. A more theoretical literature on the evolution of regional government also exists, which centers on a debate over the merits of formal government structures versus less formal governance structures. While some texts explicitly frame the debate in these terms,9 the

7 See C.R. Tindal and S.N. Tindal, Local Government in Canada, second edition, (Toronto: McGraw-Hill Ryerson Limited, 1984); Andrew Sancton and Robert Andrew Young, Foundations of Governance: Municipal Government in Canada’s Provinces, (Toronto: Press, 2009); Frances Frisken. The Public Metropolis: The Political Dynamics of Urban Expansion in the Toronto Region, 1924- 2003, (Toronto: Canadian Scholars’ Press International, 2007); I.M. Barlow. Metropolitan Government, (New York: Routledge, 1991). 8 See Garcea and Lesage Jr., Municipal Reform; Andrew Sancton, Merger Mania: Attack on Local Government, (Montreal: McGill-Queens University Press, 2000); Graham Todd. “Megacity: Globalization and Governance in Toronto,” Studies in Political Economy 56, (Summer, 1998); Julie-Anne Boudreau, Megacity Saga: Democracy and Citizenship in This Global Age (Montreal: Black Rose Books, 2000); Martin Horak. “Governance Reform from Below: Multilevel Politics and the ‘New Deal’ Campaign in Toronto, Canada.” United Nations Human Settlements Program, (Nairobi: UN-HABITAT, 2008); Roger Keil and Julie-Anne Boudreau. “Is there regionalism after municipal amalgamation in Toronto,” City: analysis of urban trends, culture, theory, policy, action 9:1 (2005), 9-22; Andrew Sancton. “Canadian Cities and the New Regionalism,” Journal of Urban Affairs, 23:5 (2001), p.543-555. 9 See Donald Phares, ed. Metropolitan Governance without Metropolitan Government, (Burlington, VT: Ashgate, 2004); Stephens, G. Ross and Nelson Wikstrom, Metropolitan Government and Governance: Theoretical Perspectives, Empirical Analysis, and the Future (Oxford: Oxford University Press, 2000); 13 discussion stems from older economic and political science arguments over public choice theory that begin with Tiebout’s landmark 1956 essay “A Pure Theory of Local Expenditures.”10 Tiebout put forward the notion that because public goods are non-excludable and non-rivalrous, it is preferable from a service delivery standpoint to have greater municipal fragmentation. This fragmentation, Tiebout argued, gives individuals the choice to locate in a jurisdiction that provides the level of services that matches the amount they wish to pay for,11 thus solving the free rider problem of larger governments where some individuals disproportionately benefit from services they have not fully paid for. Tiebout’s theory assumes certain preconditions such as a fully mobile citizenry — to be able to “vote with your feet” — and complete knowledge of the different service levels provided.12 Despite these limitations, this public choice framework has become central both in theory and in practice for subsequent debates in the United States and Canada on local government and the provision of public goods.13 If public transportation is approached as a local service, these theoretical models are not a perfect fit because transportation is not strictly a public good. The use of public transit or auto infrastructure (i.e. roads, on-street parking, etc.) can be excludable due to the costs associated with each mode. They are also rivalrous in that one person’s travel behavior affects another person’s ability to travel (i.e. bus crowding or road congestion). However, transportation does fit Elinor Ostrom’s definition of a “common-pool resource” (CPR), which she articulates as “a natural or man-made resource system that is sufficiently large as to make it costly (but not impossible) to exclude potential beneficiaries from obtaining benefits from its use.”14 This definition dovetails well with public transit systems and auto infrastructure where fares, tolls or fees can be implemented at a high cost so as to exclude potential travelers from the transportation benefits they provide. Furthermore, Ostrom reframes the public choice debate instead as a problem tied to what Garrett Hardin has described as “the tragedy of the

H.V. Savitch and Ronald K. Vogel, “Introduction: Paths to New Regionalism,” State and Local Government Review 32:3 A Symposium: New Regionalism and its Policy Agenda, (Autumn, 2000). 10 Charles Tiebout. “A Pure Theory of Local Expenditures,” Journal of Political Economy 64 (1956) 416- 424. 11 Tiebout, “A Pure Theory,” 418. 12 Tiebout, “A Pure Theory,” 419. 13 See Robert A. Dahl. “The city in the future of democracy,” American Political Science Review 61:4, (1967), 953-70; Robert P. Inman. “Financing City Services,” in Making Cities Work: Prospects and Policies for Urban America. Robert P. Inman, ed. (Princeton: Princeton University Press, 2009); Peterson, Paul E. The Price of Federalism, (Washington D.C.: Brookings Institute Press, 1995) 14 Elinor Ostrom. Governing the Commons: The Evolution of Institutions for Collective Action, 22nd Edition (New York: Cambridge University Press, 2008), 30. 14 commons.”15 The dilemma surrounding the tragedy of the commons, similar to the free rider problem, is essentially over the incentives for individuals to overuse a finite resource shared with others to the long term detriment of all beneficiaries. Ostrom quotes Hardin’s example of how it is in the best interests of individual cattle herders to overgraze the common lands until they are fully depleted, when the costs of such depletion are shared by all:

Therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit – in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons.16

The rational cattle herder, in other words, has an immediate motivation to overuse the common pool resource until it is of no benefit to anyone, for if he does not, another cattle herder might do so and therefore prevent him from benefiting from the common lands. Ostrom formalizes this problem as “the prisoner’s dilemma,” a paradoxical model where “individually rational strategies lead to collectively irrational outcomes” that “seems to challenge a fundamental faith that rational human beings can achieve rational results.”17 The policy implications of this dilemma, the argument follows, is to treat individuals as prisoners and use the coercive power of the state to manage CPRs. This power is asserted either through public ownership — the “Leviathan model” — where all decision-making is coordinated through a centralized state who acts in the best interests of the public, or through privatization where control is decentralized through property rights to individual owners who manage portions of the resource in their own best interests.18 Ostrom instead argues that there is a third way to manage CPRs that combines public coordination and decision-making power with private interests. By analyzing a large set of case studies of institutional arrangements for maintaining CPRs, Ostrom identifies certain conditions where individuals are motivated to support rules or practices that further common purposes. She identifies eight “design principles” that she argues are essential elements of long-enduring CPR institutions.19 For the purposes of this paper, five principles are particularly relevant:

1. “Clearly defined boundaries” – identifying those with rights to access the CPR. 2. “Congruence between appropriation and provision rules and local conditions” – relating required resources and restrictions to local conditions.

15 Garrett Hardin. “The Tragedy of the Commons,” Science 162. (1968), 1243-1248. 16 Hardin quoted in Ostrom, Governing the Commons, 2. 17 Ostrom, Governing the Commons, 5. 18 Ostrom, Governing the Commons, 8-12 19 Ostrom, Governing the Commons, xv, 90. 15 3. “Collective-choice arrangements” – the ability for most individuals affected by operating rules to participate in changing them. 4. “Minimal recognition of rights to organize” – some autonomy is allowed by senior governments for appropriators to create their own institutions. 5. “Nested enterprises” – operations and governance activities are embedded within multiple layers of enterprises.20

These design principles, developed from case studies ranging from fifteenth century water irrigation institutions in southeastern Spain to commonly managed forest regulations in Japanese villages first implemented in the seventeenth century, are useful for an analysis of transportation institutions in Toronto and Vancouver. This is because they highlight how specific qualities of institutional arrangements – the existence of clear boundaries, local autonomy and the ability for CPR beneficiaries to be involved in decision-making processes that affect the resources they depend on – directly impact the long-term sustainability and success of shared resources, which could include transportation systems. Within this context, the success of transportation systems can likewise be explained by using Ostrom’s institutional lens to analyze service delivery and governance. This is particularly true for public transit systems that rely on fare revenues for a significant portion of their funding. Because of this reliance, governance institutions that oversee public transit agencies must balance the public interest — improved regional — with the private political and budgetary concerns of service efficiency and cost recovery. To balance these concerns, public transit agencies have historically been kept at a slight remove from political processes so that the economic principles of supply and demand rather than election platforms drive operational decisions. Frances Frisken has written explicitly about the link between governance models and public transportation in Toronto.21 She has argued that metropolitan government has indeed “contributed to the growth and expansion of the area’s public transit system, thereby enhancing that system’s performance and its role in the area’s transportation system as a whole.”22 This paper builds off Frisken’s work by broadening the scope of metropolitan government to include the final decade of metropolitan government in Toronto as well as by comparing the influence of regional government in Vancouver of regional public transit use. Furthermore, using Ostrom’s

20 Ostrom, Governing the Commons, 90. 21 Frances Frisken, “The Contributions of Metropolitan Government to the Success of Toronto’s Public Transit System: An Empirical Dissent from the Public-Choice Paradigm,” Urban Affairs Review 27:268 (1991). 22 Frisken, “The Contributions of Metropolitan Government,” 269. 16 theoretical framework, this paper looks more specifically at common structural qualities of regional governance that have influenced transportation outcomes in Toronto and Vancouver. In transportation studies, analyzing the histories of transit systems from an institutional perspective is a growing literature. Robert Cervero’s 1998 work The Transit Metropolis: A Global Inquiry is perhaps the most well-known. It comprises twelve case studies examining the history, characteristics and institutional context of successful public transit systems around the world.23 Other literature also exists that explicitly blend an institutional analysis of transit systems with more historically-based investigation methods. In particular, writings on public transit in the New York region have sought to articulate the complex interplay of transit institutions and politics over the last century.24 On Toronto, much as been written regarding the development of the city’s public transportation system. An academic debate on the causes of the apparent success of public transit in Toronto during the 1970s and 1980s took place between mostly Australian professors in several early 1990s transportation journals.25 One of the participants, Paul Mees, has continued to write extensively on Toronto, focusing on the benefits of transit coordination, convenient transfers and multi-modal connections.26 He has argued that Toronto’s history of monopolistic municipal ownership of public transit combined with its unique operational philosophy of a network of frequent service bus lines feeding rapid transit stations has led to European levels of ridership despite North American densities.27 Two studies of Toronto’s rapid transit system have specifically analyzed the administrative and governance side of the system prior to 1998.28

23 Robert Cervero. The Transit Metropolis: A Global Inquiry, (Washington D.C.: Island Press, 1998); Kingsley E. Haynes, Jonathon L. Gifford and Danilo Pelletiere, “Sustainable transportation institutions and regional evolution: Global and local perspectives,” Journal of Transport Geography 13 (2005) 207- 221. 24 Clifton Hood. 722 Miles: The Building of the Subways and how they transformed New York (Baltimore: Johns Hopkins University Press, 1995); David King, “Exploring the Perennial Struggle for Sustainable Finance of the New York Metropolitan Transportation Authority,” UN Habitat, forthcoming; Gerald Benjamin and Richard Nathan. (2001) Regionalism and Realism: A Study of Governments in the New York Metropolitan Area. Washington, D.C., Brookings Institution Press. 25 See R. Brindle. “Toronto—paradigm lost?” Australian Planner 30:3 (1992), 123-130; Jeffrey Kenworthy and Paul Newman. “Toronto: paradigm regained,” Australian Planner 31:3 (1994), 137-147; Paul Mees. “Toronto: paradigm reexamined,” Urban Policy & Research 12:3 (1994), 146-163. 26 See Paul Mees. A Very Public Solution: Transport in the Dispersed City, (Melbourne University Press: Carlton South, 2000) and Paul Mees. Transport for Suburbia: Beyond the automobile age, (Earthscan: London, 2010). 27 Mees, A Very Public Solution, 159. 28 Frances Frisken. “Public Transit and the Public Interest: An Empirical Evaluation of Two Administrative Models,” Institute of Urban Studies Report 15, (Winnipeg: University of Winnipeg, 1986); 17 Regarding studies of Vancouver’s transit system or its relationship to their local governance model, little academic literature has been written, although it is often mentioned by authors as a new system showing promising signs of future success.29 There are three exceptions to this paucity of study: one is a study of a public-private partnership delivery model used by the transit authority to construct its most recent rapid transit line;30 another is a chapter co-written by the Vancouver region’s former chief planner with a former Premier of British Columbia on the process leading up to the current regional transit authority’s creation and its first years of operations.31 The third is a case study of Vancouver transportation completed on the eve of the creation of a new regional transportation authority in 1999.32 This study seeks to combine these studies while providing a unified narrative to understand more recent changes to current transportation patterns in the region. A common shortcoming in the literature is a more comprehensive investigation of how changes in local government structures and the formation of new transportation institutions impact the use of transit in metropolitan regions. While it has been argued by some that Toronto’s strong metropolitan government played a significant role in the city’s transit success, the changing role of the Ontario provincial government and the experience of Vancouver’s new transit authority suggest that the relationship between regional government structure and high public transit patronage is not so straight forward. By combining new primary research and the benefit of hindsight regarding municipal reforms of the late 1990s with Ostrom’s theoretical framework for analyzing institutions, the following study attempts to suggest a new understanding of the relationship between governance and transit.

Richard M. Soberman, “The Track Ahead: Organization of the TTC under the new amalgamated City of Toronto,” prepared for the Toronto Transit Commission (September 1997). 29 Cervero briefly mentions Vancouver as “following in the footsteps of the World’s Great Transit Metropolises” (415), and Mees writes a small section in Transport for Suburbia entitled ‘Vancouver takes the lead’ (106). Finally, in a chapter that otherwise praises Vancouver’s regional governance structure, a footnote suggests that transit was a major failure of the otherwise mostly successful governance system (see Phares, ed. Metropolitan Government, 211). 30Matti Siemiatycki, “Implications of Private-Public Partnerships on the Development of Urban Public Transit Infrastructure: The Case of Vancouver, Canada,” Journal of Planning education and Research 2006. 31 Mike Harcourt and Ken Cameron, City Making in Paradise: nine decisions that saved Vancouver, (Douglas & Mcintyre: 2007). 32 John F. Meligrana. “Toward regional transportation governance: A case study of Greater Vancouver,” Transportation 26 (1999).

18 Methodology The greater Toronto and Vancouver regions were selected as case studies because both cities experienced extended periods where public transit ridership significantly outpaced population growth — Toronto during the 1970s and 1980s and Vancouver from the late 1990s to the present — while having regional governance structures in place. Furthermore, both are Canadian cities and therefore are subject to a similar system of federalism (although their responsibilities and autonomy with respect to their provincial governments somewhat differ) making them more easily comparable than involving American cities. This paper’s hypothesis is that the phenomena of rapid growth in public transit usage and the existence of a regional government structure are related. To test this assertion, this paper analyzed the historic operating performance and capital expansion of public transit in both regions when transit was under the control of a regional government body. For Toronto, this period spans the 43 years between 1954 and 1997. In Vancouver, it includes from 1999 to the present. The primary source used for this research was the annual reports produced by the Toronto Transit Commission (TTC) from 1954 to the present and the Greater Vancouver Regional District’s TransLink from 2001 to the present. Population data was derived from Statistics Canada except where otherwise mentioned, and most data on public transit systems other than in Toronto and Vancouver was found in American Public Transportation Association reports. Some ridership data on Toronto, Vancouver and New York was provided directly from the agency itself to the author. Some regional transportation data for Toronto was also derived from the Transportation Tomorrow Survey. In addition, academic literature, commissioned reports, newspaper articles and a total of ten interviews conducted by the author with former and current officials or individuals — five for each city (see Interview Schedule) — involved with transportation in both regions were used in this research to understand the legislative reforms and policy changes that impacted transportation. One major shortcoming of these interviews was the inability to speak with officials in either provincial transportation ministry. This was attempted several times and would be an important part of future research into this topic. The author has drawn on different case study methodologies as a model for this research. In particular, the methods used by Frisken and Cervero of combining operating and institutional characteristics of the transit agencies they study have been relied upon to structure this paper. In the cases of Toronto and Vancouver, specific local governance reforms have been aligned to the operational performance and capital decision-making record of the public transit systems in each

19 city-region. Although by no means comprehensive, this approach looks to uncover how public transit outcomes may have been precipitated by institutional reforms to local government, or vice versa. Such a method is inherently historical in nature, drawing on interviews with officials involved in or affected by the decisions made at the time. However, it also combines an element of quantitative analysis, where transit operating and financial data as well as census statistics are examined to understand how institutional changes affected the performance of the transit agency. As a result, a political economy framework is produced where specific political decisions and governance reforms are placed within the context of a quantitative history of transportation outcomes in the Toronto and Vancouver regions.

20 Chapter 2: Toronto Transit and Public Coordination

Summary The case of public transit in Toronto is demonstrative of how an operationally strong public transit agency, when empowered by a regional jurisdiction and adequate funding resources, can produce high metro-wide levels of public transit usage. This regional service mandate and resulting fiscal support was the product of heightened suburban interest in improved transit service that began prior to the 1953 formation of a regional government and continued up into the 1970s and early 1980s. In response, the provincial created a metropolitan system of government with oversight over the former inner city transit agency (the TTC) which was to be expanded to serve the entire region. Early suburban support for service expansion and improvements in the suburbs eventually resulted in political support for transit at the Provincial level through funding formulas. However, because the jurisdictional authority and funding needed to enable the transit system to serve the entire metropolitan areas relied entirely on provincial, rather than local, political support, the long-term sustainability of regional transit expansion was largely outside of local control. Therefore, in the early 1990s when an economic recession caused steep declines in transit ridership and a new political party took power at the provincial level with no interest in supporting public transit, Toronto’s transit system was powerless to stem regional declines in transit mode shares. This history demonstrates the shortcomings of a formal governance structure that depends primarily on provincial rather than local support for public transit for providing the regional services needed to achieve high transit mode shares. However, it also demonstrates how adequate funding and the inclusion of local transit operating knowledge can provide a recipe for high transit use.

Early History: The Toronto Transportation Commission Toronto has a history of ensuring a high quality of transit access for all residents. This history is rooted in the City’s33 early ownership of all mass transit, which allowed for the development of operating and investment policies that where later to underpin its success as a regional transit authority. In 1921, Toronto’s municipal government purchased the privately-owned following the expiration of the company’s 30-year franchise to operate transit

33 The capitalized ‘City’ is here meant to denote the municipal body rather than an urban area. 21 in the inner city and reformed it as the publicly-owned Toronto Transportation Commission.34 Toronto’s public takeover of mass transit was one of the earliest on the continent and it enabled the local government to integrate the profitable private inner city lines with the municipally owned and subsidized streetcar routes built in the newly annexed suburbs where the private company had refused to extend service.35 The integration of the private and publicly owned transit services allowed for profitable lines to cross-subsidize the municipally-owned lines and enabled transit services and fares to be better coordinated throughout the city. Furthermore, with a stake in transit’s success, public ownership led the City of Toronto to invest $50 million in the Toronto Transportation Commission between 1921 and 1923 to allow it to upgrade its infrastructure.36 These early decisions to monopolize, coordinate and invest in transit meant that the Commission could offer a high quality service that competed with no other transportation services other than the private automobile, which was greatly increasing at the time.37 Furthermore, the investments provided the system with a sound financial footing that would be a key to ensuring the long-term success of the Commission. The investments enabling the TTC to upgrade its infrastructure were greatly facilitated by public ownership, which provided the agency with access to municipal credit and the ability to raise fares to fund transit improvements and expansion. To fund these investments, the City was named as creditor and a fare policy was established where “only such rates of fares shall be charged as will secure [adequate and efficient service], and will, at the same time, make the system self-sustaining — including the maintenance of the property in good condition, and due provisions for renewals, depreciation, and debt charges.”38 In other words, revenue maximization was not the goal, but fares could still increase if system maintenance and expansion demanded it. As a result of this policy, the nickel fare — the maximum amount the private company had been allowed to charge prior to 1921 — was immediately raised to seven cents and debt service payments were substantially reduced.39 By comparison, the New York subway system did not

34 Frances Frisken, “A Triumph for Public Ownership: The Toronto Transportation Commission, 1921- 1953,” in Forging a Consensus: Historical essays on Toronto, edited by V.L. Russell, 238-271, (Toronto: University of Toronto Press, 1984), 240. 35 Frisken, “A Triumph for public ownership,” 244. 36 Donald Davis. “Mass Transit and Private Ownership: An Alternative Perspective on the Case of Toronto,” Urban History Review 3 (Feb 1979), 63. 37 For instance, in New York City, automobile registrations increased from 39,000 in 1915 to over 610,000 by 1927 (see King, “The Metropolitan Transportation Authority,” 5). 38 City Minutes, 1919, Appendix A, p. 1937, quoted in Frisken, “Public Transit and the Public Interest,” 16. 39 Frisken, “Public Transit and the Public Interest,” 18. 22 raise fares above a nickel until 1948, which led to significant disinvestment that continues to trouble the system today.40 The TTC’s early ability to raise fares and use municipal credit in order to maintain high quality service and fund system expansion were directly facilitated by public ownership and became the two fiscal pillars that kept the transit system self-sustaining for the following fifty years. Operating policies established during this period also contributed to the TTC’s long term success, many of which continue to benefit the system today. An “equity principle” was established to measure transit service adequacy, stipulating that all City residents must have regular service within 2200 feet (670m) — less than a ten minute walk — of their residence.41 This principle established a philosophy of “supply-led service”42 where transit would be extended to areas prior to those routes being profitable. However, to keep the system self-sustaining, this principle was restrained to reasonable limits by a conservative fare policy that required service to be funded through the fare box. To meet these service requirements while nevertheless remain financially solvent, the Commission continued an innovative practice begun under private ownership where newly annexed areas would be serviced by bus lines fully integrated with streetcar routes through convenient transfers. This approach meant the TTC could test the demand for transit in these lower density areas and better prioritize capital-intensive streetcar service expansion.43 Such intermodal integration was relatively rare during the inter-war period, and it contributed to the Toronto Transportation Commission being the only North American transit system servicing a population over 500,000 that grew its ridership between 1925 and 1928 despite having higher fares than most other systems.44 The result of these policies was a progressively principled yet fiscally conservative transit system that garnered widespread public and political support. Fare flexibility, low borrowing costs, strict service formulas and the City of Toronto’s unwillingness to continue annexing its less dense neighboring municipalities prior to the formation of a Metropolitan government enabled the Commission to generate sizable profits and enjoy region-wide popularity. Using only is savings from the profits it had accumulated prior to

40 Hood, 722 Miles, 217. 41 By 1930, the TTC claimed to have brought transit service to within 2000 feet of 99.5 per cent of the City of Toronto’s entire population See Mees, A Very Public Solution, 269; Frisken, “Public Transit in the Public Interest,” 23. 42 Mees, A Very Public Solution, 272. 43 Mees, A Very Public Solution, 269. 44 During this time, there were eleven other transit systems serving populations over 500,000 in North America. See Frisken, “A Triumph for public ownership,” 240. 23 the conclusion of World War II, the transit agency began constructing Canada’s first subway line to replace its busiest streetcar route on , which opened to great fanfare on March 30, 1954.45 Such financial success was in stark contrast to other transit systems in North America, many of which were in great fiscal peril despite experiencing record ridership.46 Public ownership deserves much credit in this regard, since it allowed all profits to be reinvested in transit rather than funneled into the hands of private operators. In contrast, profit-sharing agreements in New York City between the municipal government and its two private subway companies for the construction and operation of transit resulted in an accumulated municipal deficit of $461.4 million between 1919 and 1940, with the small profits that were made going to private bank accounts instead of system expansion.47 Meanwhile, Toronto’s publicly owned transit system was, as one commentator has written, “a paragon of the soundly managed municipal enterprise, avoiding deficits, retiring a large debt, and building the Yonge Street subway from its own savings.”48 The success and fiscal strength of the Toronto Transportation Commission as it emerged from the post-war period made its services highly regarded in the City of Toronto and the surrounding municipalities, despite serving only the former. With local government reform just around the corner, Toronto’s transit system was the envy of its neighbors during the late 1940s who were then using municipal revenues to pay for service contracts with private bus companies and the Toronto Transportation Commission to operate money-losing routes within their borders. These lines connected to Toronto’s transit system but required a separate fare to transfer. While the latter two characteristics — service contracts and separate fares — would eventually change under Metropolitan government, the fare and service policies established by the TTC during the first years of public ownership would continue to guide operations under future governance arrangements.

The TTC under Metro: Tough Beginnings The provincial decision to reform local governments in Toronto area into a unified regional government body in 1953 had important consequences for public transit use in the region. As part

45 TTC, 1954 TTC Annual Report, 6. Accessed at the City of Toronto Archives 23 February 2012. 46 American public transit unlinked trips had increased from 14.6 billion in 1921 to 23.5 billion in 1946, a peak the country has never surpassed (See “2012 Fact Book: Appendix A Historical Tables,” American Public Transportation Fact Book, 1. Accessed February 23, 2012, http://www.apta.com/resources/statistics/Documents/FactBook/2012-Fact-Book-Appendix-A.pdf. 47 Hood, 722 Miles, 195. 48 Timothy J. Colton. Big Daddy: Frederick G. Gardiner and the Building of Metropolitan Toronto, (Toronto: University of Toronto Press, 1980), 165. 24 of the reforms, the City of Toronto’s transit system was required to become the sole regional provider of public transportation while remaining self-sustaining. To meet this requirement, inner city riders — who comprised the vast majority of transit users — were forced to indirectly subsidize the increased marginal cost of transit service to fast growing wealthier communities in the lower density suburbs through higher transit fares and foregoing major inner city service upgrades. The short-term consequences of this inequitable policy included a decline in total system ridership and an increase in suburban political support for further transit expansion. As a result, lacking the ability to pay for new suburban service through direct public revenues — a power held by the Province — inner city riders were forced to take on higher fares without higher order service, contributing early declines in public transit use under Metropolitan government mirroring those experienced all over the continent during this period. On April 15, 1953, the Ontario government passed The Municipality of Metropolitan Toronto Act, 1953. The Act created a 240 square mile (630 square kilometer) Municipality of Metropolitan Toronto comprised of 12 boroughs (former municipalities and townships) centered around the former 35 square mile (90 square kilometer) City of Toronto and organized in a two- tier federated government structure (see Exhibit 3). Combining Toronto with its twelve suburbs had been supported by Toronto’s City Council since 1950 following increasing concerns over water supply, new schools and increasing traffic congestion.49 Such concerns were buttressed by planning reports highlighting how more than one third of the metropolitan area’s residents then lived outside of the old City of Toronto’s jurisdiction, up from approximately one quarter less than a decade earlier (see Exhibits 2 and 3).50As a result, in April, 1953, a two-tiered structure of government was set up with a lower tier comprised of the thirteen local borough councils and a more powerful upper tier council with control over Metro-wide policies. Local councils had responsibility for most existing services and were made up of wards where two aldermen were elected per ward. The alderman who received the most votes sat on both the local council and Metro Council. Metro Council was responsible for region-wide services like water supply, sewage treatment, roads, debentures and appointing a chairman from its own members along with five citizen transit commissioners.51 Initially, Metro Council had twelve members from the former City of Toronto and one from each suburban borough, all of whom had one vote. Harold

49 Tindal and Tindal, Local Government, 66. 50 Colton, Big Daddy, 64, 67 51 The selection of the first chairman, Frederick Gardiner, was the only exception since he was selected by the Premier of Ontario at the time, Leslie Frost. 25

Exhibit 2: Population change in the Toronto area, 1941-1949 Year City of Toronto 12 Suburban municipalities % of Population in Suburbs 1941 655,751 236,428 26.5%

1945 681,802 263,284 27.9%

1949 673,104 347,922 34.1% Source: Civic Advisory Council of Toronto, 1951 in I.M. Barlow, Metropolitan Government, p.194 table 6.1

Exhibit 3: Population Distribution in the Toronto Metropolitan Area, 1948

Source: Toronto and York Planning Board Report 1948, found in White, “The Growth Plan,” 11.

Kaplan has argued that this system of indirect election to Metro Council contributed to a very successful first decade of Metropolitan governance. He saw this as the result of Metro councilors largely being judged by their electorate on their borough records rather than their actions on Metro Council, allowing city-wide policies to be less colored by politics and more swayed by rational argument.52 Metro Council’s distance from electoral accountability would shape many of the early transit policies first implemented under the new metropolitan government structure.

52 Quoted in Tindal and Tindal, Local Government, 67. 26 The City of Toronto-owned Toronto Transportation Commission was also explicitly targeted for reforms by the Province, who reincorporated it as the Toronto Transit Commission (emphasis added) in 1954 under Metro ownership as the sole provider of public transit for the entire metropolitan area. The legislation expanded the TTC’s service area sevenfold to include 205 new suburban square miles, however this increase was not accompanied by any changes to the TTC’s former mandate to be financially self-sustaining. In 1953, suburban densities were approximately 2350 people per square mile (1460 per km), whereas densities within the former City of Toronto were almost 20,000 people per square mile (12,430), which had facilitated operating profitable service.53 Because of this disparity in densities, prior to Metro the TTC had negotiated service contracts with the neighboring municipalities when operating transit service in their jurisdictions. A set amount had been paid by each local government directly to the TTC based on the amount of service received to ensure the Commission avoided incurring an operating loss. Four independent bus lines also had similar arrangements with suburban municipalities. Under the new Metro system, not only would such service contracts be eliminated but the independent bus lines would need to be purchased so that the TTC would have a monopoly on all transit service54 in Metro Toronto. To ensure these new responsibilities would be managed effectively, the TTC was expanded from three to five commissioners, all of who would be private citizens appointed by Metro Council. The cumulative impact of these structural changes under Metro immediately challenged the new transit commission’s mandate to remain self-sustaining, despite the completion and launch of the Yonge Subway line in 1954, its first year of operation under Metro. The first operating deficit under public ownership of $2,355,920, or eight per cent of the TTC’s net expenses, was incurred for its opening year. As the commissioners wrote to the public in the 1954 TTC Annual Report, “it must be pointed out that your new Commission was charged with many major responsibilities and burdens which did not previously exist or did not apply to the former Commission” without being provided with any new revenue sources.55 Making matters worse was the growth in automobile use; registrations in the Toronto area had more than doubled to 326,009 in 1954 from 152,961 in 1940.56 These challenges aside, coordinated public ownership consolidated fourteen separate fares systems in use prior to Metro into one unified zone fare

53 Frisken, “Public Transit and the Public Interest,” 29. 54 A subsidized municipal ferry service between and the was also transferred to the TTC in 1954. 55 TTC, 1954 TTC Annual Report, 6. 56 TTC, 1954 TTC Annual Report, 20. 27 system and substandard equipment used on suburban bus lines was replaced by the TTC’s higher quality infrastructure.57 While negatively impacting the TTC’s finances, the change increased access and service quality to many new riders in the region. The Municipality of Metropolitan Toronto Act, 1953 was also one of the earliest examples of the provincial government of Ontario’s direct involvement in public transit. Up until 1954, the TTC had been a body corporate of the former municipality of the City of Toronto whose only role was to approve debentures and occasionally vote on policy decisions such as the building of the Yonge Subway. However, since the British North American Act, 1867, municipalities in Canada were legally “creatures of the province,” meaning that the provincial government had complete authority over municipal government if it chose to exercise those powers. With Canadian local governments lacking the home rule protections of their American counterparts to prevent major reforms, Frisken has argued that the formation of Metro demonstrated “the Ontario government’s willingness to assert its constitutional authority over ‘municipal institutions’ and the services it delegates to them.”58 This willingness to change municipal institutions and their services included a willingness to intervene in public transit. But rather than the creation of a new metropolitan-wide transit authority being an afterthought, events leading up to Metro’s creation suggest that transit concerns may have been one the chief drivers of the governance reforms. A regional transit authority had been suggested by a 1948 planning study and had been endorsed in a 1953 report by an Ontario Municipal Board official authorized to resolve planning matters.59 What may have been more important, however, was the perception that by expanding TTC operations into the suburbs, this new infrastructure would be able to pay for itself, as it did in the City of Toronto. This made an enlarged TTC jurisdiction appealing to suburban public officials so as to reduce the need to constructing roads, highways, parking facilities or continue paying private transit operators.60 Mees argues along these lines, writing that it was the strength of the old City of Toronto’s transit service and “dissatisfaction with suburban systems that led to the TTC having legal responsibility for all of Metro.”61 In contrast, he cites the experience of 1950s Chicago, where suburban municipalities wanted no part in supporting the impoverished public transit system that had recently been purchased by the inner city

57 TTC, 1954 TTC Annual Report, 6. 58 Frances Frisken. “The Toronto Story: Sober Reflections on Fifty Years of Experiments with Regional Governance,” Journal of Urban Affairs 23:5 (2001), 513. 59 Frisken, “Public Transit and the Public Interest,” 26-7. 60 Frisken, “Public Transit and the Public Interest,” 26. 61 Mees, A Very Public Solution, 270 28 municipality.62 The situation was reversed in Toronto where in 1953 the symbol of a new, self- funded subway about to open the following year brought widespread interest in bringing transit rather than just auto infrastructure into the suburban areas of Metro Toronto. The TTC’s new incorporation under Metro government was therefore seen as an attractive way to facilitate new suburban expansion. Under Metro, a system of checks and balances was imposed on the TTC through governance and funding arrangements that were meant to insure system expansion took place without inflicting too great of a financial burden on the new Metro Council. The first check was that operations must remain self-sustaining as they were under the City of Toronto. This allowed TTC management to resist acting on calls for rapid suburban expansion because of the unprofitable nature of new suburban routes. As a result, they provided an internal check on the requests of suburban politicians for greater service by insisting on a slower approach. A public statement made by the TTC during this time declared that it would provide “basic services only on the main arteries to established centres of industry or population” despite acknowledging “a duty to aid in community development by pioneering services which for the time being are not self-supporting but which give promise of becoming so in the near future.”63 While this check benefited Metro Council’s finances, it also potentially limited transit use in the suburbs since the TTC’s service monopoly entailed that no other transit services were allowed to operate. Countering this curtailment of suburban expansion was the TTC’s earlier policy of supply led service, which believed that all residents within the transit system’s jurisdiction deserved a minimum of access to service. As a result, the system’s requirement of self-sustainability was waived by the Province in the first two years of service so that Metro could provide one-time subsidies to purchase bus lines and support existing ferry services. To some commentators, the use of Metro funds to support transit operations was an early sign that “Metro influence was sure to follow Metro money into the transit field.”64 A delicate balance was therefore established by TTC management using rail-feeding bus lines — as had succeeded prior to Metro — and a zone fare system to fund incremental expansion in a manner that kept operations revenue neutral. However, fare raises across the system were also required to fund this expansion, beginning in 1956 when the Commission raised central city zone fares to 12.5 cents from 10 cents (there

62 Mees does not mention urban racial strife occurring during the period, which also may have contributed to suburban unwillingness to support transit expansion. 63 Quoted in Frisken, “Public Transit and the Public Interest,” 28. 64 Colson, Big Daddy, 167. 29 initially five zones for Metro). With 90 per cent of all TTC ridership using transit in the former City of Toronto, this had the effect of placing some of the costs of suburban expansion onto downtown riders who saw little benefit from new services to predominantly low density residential areas.65 This indirect cross-subsidy requiring raising transit fares so as to support suburban service reinforced the TTC’s position that a slow approach to expanding services was needed to avoid fare raises that would encourage riders to switch to auto travel. Despite these warnings, TTC patronage declined during the 1950s while total service increased during this period, negatively reflecting Metro’s impact on the TTC in the first decade under regional government. Ridership declined from to 271 million revenue trips in 1963 from 312 million in 1955 despite population in the center city remaining at 670,00066 (see Exhibit 4). Although this may have been influenced by rising automobile registrations, Richard Soberman has pointed out that all of the first five TTC commissioners appointed by Metro Council were

Exhibit 4: Toronto Transportation Statistics, 1955-1963

1955 1963 Change Revenue passengers (millions) 312.8 271.1 -13.3% Bus route miles 213.58 345.83 61.9% Buses owned 457 714 56.2% Streetcars owned 886 754 -14.9% Subway cars owned 106 170 60.4% Base ticket fares (calculated 2012$) $0.86 $1.06 23.3% Metro population 1,304,363 1,677,700 28.6% Metro automobile registrations 355,300 526,000* 48.0% Persons per automobile 3.9 3.2* -17.9% Rides per capita 239.8 161.6 -32.6%

*uses 1961 numbers

Source: TTC Annual Reports, 1955, 1961, 1963 former politicians,67 suggesting that new services may have been more reflective of political rather than operational demands. Frisken has also observed that ridership declines were concentrated on routes that did not connect with the new subway — the majority of which were in the suburbs — where ridership was actually increasing from 1954 to 1959.68 These two facts

65 Frisken, “Public Transit and the Public Interest,” 33. 66 H. Carl Goldenberg, Report of the Royal Commission on Metropolitan Toronto, (Toronto: June 1965), 43, quoted in Frisken, “Public Transit and the Public Interest,” 36. 67 Soberman, “The Track Ahead,” 13. 68 Frisken, “Public Transit and the Public Interest,” 29-30. 30 suggest that older policies concentrating system improvements in areas where there was demand were being trumped by the new Metro mandate to expand into the suburbs while remaining self- sustaining. This translated into center city riders paying higher fares to support the higher marginal cost of suburban expansion while receiving few service benefits. The institutional arrangements that facilitated these decisions reflected early on how Metro government had the effect of politicizing TTC operations to the benefit of suburban residents of Metro Toronto who received better transit service than prior to Metro government without paying the full costs of such service.

The Politics of Subways and the Transition to Subsidies: 1959 to 1970 As ridership declined and car use grew, further congesting city streets, calls to expand the subway system increasingly became a political concern for Metro Council rather than simply an operational decision for the TTC. With profits from the inner city streetcar and subway lines going to fund new suburban bus lines rather than being saved to upgrade heavy ridership routes downtown, the TTC no longer had the ability to finance the new subway lines that staff believed the system needed to stop ridership loss to cars. The 1960s were therefore a time of transition as the TTC’s ability to self-fund system expansion reached its limit. As a result, new institutional arrangements were created that led to government funding rather than system profits driving ridership growth. This occurred first through the use of capital subsidies to drive system expansion and the ultimately through operating subsidies that lowered suburban fares and made better suburban service possible. Declining bus ridership and increased subway usage combined with growing congestion resulting from more car use led to an argument within the TTC for prioritizing subway construction where ridership already existed as a way to retain current users of the system. Lacking the power to manage the use of the roads, it was believed that new bus lines would only increase the TTC’s difficulties of remaining revenue neutral without stemming ridership loss. This soon led to calls to build another subway line. However, due to the TTC’s new fiscal realities where profits from heavily used inner city lines were needed to fund suburban expansion, no savings would be available — as they were for the Yonge subway — for a new line. Instead, a new subway line would need capital subsidies from Metro to be built. The need for public tax revenues to construct a new subway reflected changes in part derived from the new

31 institutional environment the TTC found itself in during the 1950s which resulted from the establishment of Metro government. It is also the first example of how major capital projects, as this paper will show, often serve to exemplify the impact that changes in governance structures have on local transit decision-making and service. The decision-making process that led to the building of a new subway in Toronto beginning in 1959 demonstrated the changing role of both local and provincial actors in transit service. The TTC had long argued that subways served many purposes that benefitted all Metro inhabitants, including freeing up road space formerly occupied by streetcars and contributing to downtown revitalization and increased property values, as was evidenced by the Yonge Subway.69 However, suburban representatives initially opposed Metro paying for subways, seeing them as serving only downtown residents where TTC management advocated they be built to replace heavily used streetcar routes. Yet with the TTC no longer able to afford subway construction without outside help and the provincial government unwilling to support public transit as they did for road construction,70 planners and TTC officials looked to Metro for new funding. Two debates ensued over subway construction that clearly demonstrated how the Metropolitan governance structure was beginning to make its imprint on transit in Toronto. The first was political and took place on Metro Council between suburban and city councilors. Suburban members argued that subsidizing subway construction placed an unfair burden on suburban residents who already received less service for higher prices due to zone fares71 — a complaint the central city could also have made regarding fare raises and suburban bus expansion. The second disagreement was administrative and took place between TTC staff and Metro planners over route alignment, revealing contrasting understandings of the transit authority’s new role under Metro. Following their original policy of upgrading lines where ridership demanded it, TTC staff advocated for a Bloor-University-Danforth alignment where streetcar lines were busiest. Metro Planners, on the other hand, argued for a U-shaped alignment paralleling Bloor Street between Keele and Clinton Sts, then south to run under Queen St. west to

69 Donald N. Dewees. “The Effect of a Subway on Residential Property Values in Toronto,” Journal of Urban Economics 3:4 (1976), 357-369. 70 At the time, the Province provided a 50 per cent subsidy for road construction. The premier at the time, Leslie Frost, also believed that increase public transit use would reduce provincial revenues stemming from automobile sales. See Frisken, “Public Transit and the Public Interest,” 32-3. 71 Frisken, “Public Transit and the Public Interest,” 33. 32 Pape Ave. and then north to Danforth Ave, before heading east to terminate at Woodbine Ave.72 The impetus for the planners’ alignment was a philosophy tied to regional planning goals that sought to create a strong downtown core. Frisken writes:

Metro planners, taking their cue from existing City of Toronto plans and the developmental goals of provincial and local backers of the metropolitan experiment, adopted as their primary objective that of finding ways to strengthen the city’s downtown core as Metropolitan Toronto’s commercial and cultural center…They early concluded that it would be impossible both to achieve that objective and satisfy all travel demand into the center by building roads alone; that public transit was also necessary. They argued, therefore, that subways should be designed for the primary purpose of channeling commuter traffic into the downtown core on routes coming directly either from residential areas of high and medium density or from the terminal points of expressways serving areas of lower density.73

This philosophy, where subway construction should facilitate suburban commuting patterns into the central city, jarred with the TTC’s philosophy of responsive service that matched observed demand. The planners’ position was also more overtly political by looking to share transit investments more equally between suburbs and city — both of whom would be footing the bill — despite the majority of transit use taking place downtown. As a senior planner at Metro during the period remarked, “we took the position that subways serve a political purpose.”74 A compromise route that more closely aligned with the TTC’s preferred alignment was ultimately chosen by Metro Council, although terminus extensions suggested by the planners into the suburbs were later included in the plan so as to overcome “suburban resistance to providing the TTC with more financial assistance.”75 Metro initially agreed to pay for 55% of the subway construction costs — following Provincial approval — but this was later increased to 70% following approval of the extensions, with the Commission paying the remainder through debt.76 The final route choice demonstrated the extent operational concerns and Metro planning goals were influencing transit decision-making, which had formerly been concerned predominantly with supporting the travel patterns of existing riders. The debate over subway construction also had structural consequences for transportation decision-making that largely served to strengthen the power of Metro planners and politicians. As subway construction commenced in 1959, Metro split the responsibilities formerly held by the TTC general manager into two positions, one for operations and the other for subway

72 TTC, 1957 TTC Annual Report, 10. 73 Frisken, “Public Transit and the Public Interest,” 30. 74 Interview with Eli Comay by Frances Frisken on January 24, 1982, quoted in Frisken, “Public Transit and the Public Interest,” 34. 75 Frisken, “Public Transit and the Public Interest,” 34. 76 Frisken, “Public Transit and the Public Interest,” 34. 33 construction, so as to isolate operations staff from route planning staff. Frisken has argued that this change attempted to make management more subordinate to the Metro-appointed Commissioners.77 In contrast, the Metropolitan Planning Commission was granted additional staff for transit planning as well as a liaison who would attend TTC meetings as a non-voting member to report to Council on both the Planning Commission and TTC.78 Four Metro council representatives were also added to the Metro Planning Commission along with the TTC Chairman. These structural changes institutionalized the reduction of TTC independence that had already been taking place at the political level by heightening Metro control over transit decision- making. Relations between the TTC and Metro became more fractious during the 1960s as the TTC’s ability to fund its operations solely through fare revenues became increasingly difficult to sustain under the new operating arrangements. The TTC began barring the Metro Planning liaison from commission meetings not directly dealing with subway construction during this time.79 Nevertheless, in 1962 fare zones were reduced from five to two under pressure from Metro Council, which led to consecutive annual operating deficits in 1962 and 1963. Despite these deficits, the zone merger succeeded in stemming continuing ridership declines that had decreased patronage by 16.4% since 1954 to 267.6 million in 1962 despite year-on-year increases in bus service.80 Explaining this situation in the 1962 TTC Annual Report, the TTC Commissioner writes:

The paradox of increased riding and a financial loss in the same year was the result of increased costs, a decrease in the adult fare on May 1st 1962 and the Commission’s continued policy of extending routes into newly developing suburban districts at a pace believed to be unmatched anywhere on the continent. Bus service in the suburbs was increased by almost one-half million miles in 1962 to a new high of 8,764,000 miles. This is 3,624,000 miles more than were operated in 1955, the first full year of Metro transit service, a 70% increase…but the fact must be faced that bus routes into new suburban districts are heavy money losers, sometimes for many years. Legislation requiring the T.T.C. to be self-sustaining, plus demands for more and more money- losing suburban routes, plus the necessity of maintaining fares at an acceptable level, has created a financial straight jacket which, if it is not loosened, will make it increasingly difficult for public transit to continue to contribute fully and effectively to the well-balanced transportation system Metro is striving for.81

77 Frisken, “Public Transit and the Public Interest,” 34. 78 Frisken, “Public Transit and the Public Interest,” 34. 79 Frisken, “Public Transit and the Public Interest,” p.35. 80 TTC, 1961 TTC Annual Report, 3. 81 TTC, 1962 TTC Annual Report, 3. 34 Although the increase in ridership that followed the zone fare merger could be seen as a further transfer of service benefits from the older dense city to the new, more wealthy suburbs, the opening of a publicly funded new subway line the following year — much of which was downtown — complicates such a position. Instead, the operating deficits that began to appear in the 1960s (see Exhibit 5) and the need for capital subsidies demonstrated how the use of inner city fares to subsidize suburban service had reached their useful limit. Going forward, system

Exhibit 5: TTC Revenues and Expenses, 1962-1970

Source: TTC Annual Reports, 1962-1970 expansion would have to occur either more slowly and in areas where demand warranted it — as had historically occurred prior to 1954 — or through government funding that could subsidize new suburban service. Public awareness of this impasse arose out of the repeated fare raises that occurred during this time as the TTC attempted to pay for new transit services through its existing ridership. Regarding the first fare increase in 1964, the TTC Annual Report from that year asserts that:

There was every indication that transit passengers understood and accepted the fact that it was

35 necessary to increase fares in order to continue to build subways, purchase new equipment and to extend transit lines into new areas. An increase of over 4 million riders in 1964 despite the fare increase is in direct contrast to the experience of almost every other Canadian and U.S. transit system, where a rise in fares has been invariably followed by a drop in the number of passengers.82

The TTC’s ability to raise fares in 1964 without suffering any ridership losses during this time suggests that investments in improved and expanded transit service were being recognized and there was a willingness to pay for these through higher fares.83 A second fare increase in 1967 also caused little outcry or negative impact on ridership growth. Yet by 1968, ridership increases had stagnated and a fare hike in 1969 decreased TTC patronage for the first time in eight years (see Exhibit 6). 1970 also saw little change in the number of people taking transit, despite Metro Council’s decisions to pay for reduced fare tickets for senior citizens, exempt the TTC from all municipal property taxes and pay for the entirety of the TTC’s share of construction costs for the northern extension into the suburbs of the Yonge subway — a project the provincial government was already contributing to through roadbed grants.84 With Metro’s initiatives still unable to return the TTC to a pattern of growth, attention turned to the Province that held both the authority and the funding to allow for greater political involvement in transit operations. Having already involved themselves in TTC operations through providing funding for fare discounts, subway construction and tax exemption, Metro moved to request that the province grant it the power to appoint one of its own elected members to the TTC board. The province not only approved this request, but granted Metro the power to appoint any number of councilors for either one or three year terms. One senior provincial official from the time “described the government’s action as a move designed to enable Metro Council to do away with an appointed TTC entirely and transfer its responsibilities to Metro Council whenever it wished to do so.”85 Provincial enabling legislation granted Metro Council new powers over the TTC by connecting TTC operations decision-making directly to the political process, further heightening the growing influence of politicians over transit in Toronto.

82 TTC, 1964 TTC Annual Report, p.3-4 83 The TTC’s ability to remain revenue neutral during this time also credits the development policies implemented by Metro planners that limited leapfrog development and ensured suburban roads were constructed early on so as to allow new bus routes to begin operating immediately. See Frisken, “The Contributions of Metropolitan Government,” 282. 84 Frisken, “Public Transit and the Public Interest,” 34, 40. 85 Globe and Mail Article, Nov 7, 1971 and article, Nov 10, 1971 quoted in Frisken, “Public Transit and the Public Interest,” 34. 36 Exhibit 6: TTC Ridership, 1960-1970

Source: TTC Annual Reports, 1960-1970

The province’s decision to grant Metro unprecedented control over TTC operations through the ability to appoint elected councilors to the Commission followed a pattern of growing provincial interest in public transit in the Toronto region. Hints that the Government of Ontario was interested in influencing public transportation planning began with the construction of the east-west Bloor subway in 1959, when they agreed to reimburse Metro for 33.3 per cent of the costs of subway roadbeds.86 This support was increased in May, 1961, when Metro Chairman Gardiner convinced Ontario Premier Leslie Frost to provide a low-interest $60 million loan to Metro so as to speed the construction of the new subway line and advance the completion date by two and a half years.87 In 1967, the Province reformed Metro Toronto’s governance structure by consolidating the thirteen boroughs into six, dramatically shifting power on Metro Council, including the power to appoint TTC Commissioners, in favor of the suburbs. Despite Metro’s wishes and the recommendation of the provincially commissioned Goldenberg Report released in 1995 that all

86 Frisken, “Public Transit and the Public Interest,” 34. 87TTC, 1961 TTC Annual Report, 4. 37 boroughs be consolidated into one amalgamated city,88 instead the twelve suburban boroughs were consolidated into five and suburban votes on Metro Council were increased from 12 to 20. This change significantly reduced the old City of Toronto’s voting power on Metro Council, which had remained its own borough with twelve votes, which now more closely reflected the real distribution of Metro’s total population (see Exhibit 7).89 Also important in the reforms were what wasn’t changed. This included Metro’s current political boundaries, which, rather than being extended to include the growing areas outside Metro’s borders where the Metro Planning Commission had some power, were kept at their 1953 position (see Exhibit 8). Rapid population growth in these exurban areas — formerly constrained by Provincial regulations regarding septic tanks and Metro planning policies — was quickly undermining Metro’s claim as a regional governance body for the entire urbanized area.

Exhibit 7: Population Growth in the Toronto Census Metropolitan Area (CMA) 1971 1976 Total Population % of CMA Population % of CMA Pop Growth Toronto CMA 2,628,043 100% 2,803,101 100% 6.70% Metro Toronto 2,086,017 79.40% 2,124,291 75.80% 1.80%

Population % of Metro Population % of Metro Pop Growth Metro Toronto 2,086,017 100.00% 2,124,291 100.00% 1.80% Old City of Toronto 712,786 34.20% 633,318 29.80% -11.10% Total Suburban Boroughs 1,373,231 65.80% 1,490,973 70.20% 29.70%

Suburban Boroughs Scarborough 334,310 16.00% 387,149 18.20% 15.80% 104,784 5.00% 106,950 5.00% 2.10% 504,150 24.20% 558,398 26.30% 10.80% York 147,301 7.10% 141,367 6.70% -4.00% 282,686 13.60% 297,109 14.00% 5.10% Source: Statistics Canada

Signs that the Greater Toronto Area had expanded beyond Metropolitan Toronto were seen most clearly through the launch of provincially-owned service in 1967. Government of Ontario Transit, or GO Transit, was initiated by the province as an entirely separate transit service from the TTC that linked eastern and western suburban municipalities of

88 Juri Pill. Planning and Politics: The Metro Toronto Transportation plan Review (Boston, MA: MIT Press series in transportation studies, 1979), 23. 89 Frisken, “Public Transit and the Public Interest,” 40; Frisken, The Public Metropolis, 111. 38 Metro to downtown Toronto.90 Commuter rail service had been proposed in the 1962 Metropolitan Toronto and Regional Transportation Study (MTARTS), a large provincial study of the entire census metropolitan area surrounding Toronto that had also proposed that a network of highways be built to crisscross the region. These highway plans would later provoke significant

Exhibit 8: Metropolitan Toronto Planning Jurisdiction and Urbanization, 1969

Source: Dakin, “Metropolitan Toronto Planning,” 8. opposition in downtown Toronto, a topic that has received much study91 and will be briefly touched upon further on in this paper. Together, MTARTS, the launch of commuter rail service, and the decision by the Province not to expand Metro’s boundaries demonstrated growing provincial involvement in transit and the weakening position of Metro Toronto as a regional government.

90 Frisken, “Public Transit and the Public Interest,” p.40. 91 Jake Schabas. “Deck the Allen,” Spacing Magazine (Fall, 2010) 18-21. 39 “New York run by the Swiss”92: 1971 to 1989 The introduction of Metro and Provincial operating and capital subsidies in 1971 ushered in two decades of expansion that brought international recognition to the TTC and made the ‘Toronto Model’ synonymous with public transit efficiency and success. Such success was facilitated by transit funding formulas established by the Provincial government, which provided new resources to accelerate the operating and system expansion patterns set under regional governance. However, credit for this success should not be attributed to additional funding alone, as the first few years of provincial subsidies demonstrate. The unprecedented ridership gains accomplished during the 1970s and 1980s are largely attributable to the funding formulas and governance structure that combined the TTC’s traditional network of frequent feeder buses with a Metro- influenced supply-led service policy and significant predictable funding through the “users’ fare share formula.” This intergovernmental cooperation to support both TTC operating principles and Metro’s transit goals led ridership to increase by 56.7 per cent between 1971 and 1986, a growth rate ten times faster than population increases during this period. By the 1980s, the TTC claimed North America’s highest per capita ridership rate93 of 201 trips per person in 1986, up 49 per cent from 135 in 197194 (see Exhibit 9). Ridership growth in Metro was so great that it lifted the census metropolitan area per capita average despite declining transit use in the faster growing suburbs outside Metro’s borders.95 This success led the TTC to launch its own in-house consulting firm in 1985, the Toronto Transit Consultants Ltd, who by 1987 were managing 20 transit projects around the world, including in Singapore, Lima, Los Angeles, Washington D.C. and Philadelphia.96 The entry of the Ontario government into public transit operations and expansion through significant funding formulas was unexpected, and came during a high point in local interest and activism in Metro’s transportation policies. In what has been described as “probably the most important transportation decision that has been made during Metropolitan Toronto’s existence,”97

92 A description of public transit in Toronto during this period by Peter Ustinov, a famous British actor. See Mees, A Very Public Solution, 156. 93 TTC, 1986 TTC Annual Report, 6. This was facilitated to some extent by the rapid decline of ridership on the New York City Subway System between 1960 and 1980, when its trips per capita decreased by 40 per cent from 202 to 121. See Newman and Kenworthy, “The land use-transport connection” 11. 94 Facilitating Toronto’s continental leadership was the twelve per cent decline in passengers on the New York City subway between 1971 and 1989 (Data provided by New York City Transit Office of Management and Budget, on 12 December 2011). 95 Mees, Transport for Suburbia, 92 96 TTC, 1987 TTC Annual Report, 12. 97 Pill, Planning and Politics, 38. 40 in 1971 Ontario Premier William Davis cancelled the construction of the Spadina Expressway — an urban freeway planned to run through central neighborhoods in the City of Toronto —

Exhibit 9: TTC Operating Statistics, 1971-1986

1971 1986 Change Metro Toronto Population 2,086,017 2,192,721 5.1% TTC Ridership (millions) 281.5 441.0 56.7% Metro ridership per capita 134.9 201.1 49.0% Kilometers of Service (millions) 118.1 190.2 61.0% Cost Recovery Ratio 93.6% 69.1% -26.2% Ticket Fare (CAN$ 2012) $1.48 $1.50 1.4% Number of Buses 963 1,525 58.4% Total Fleet Size 1,871 2,608 39.4%

Source: TTC Annual Reports, 1971-1986 and Statistics Canada and initiated provincial operating and capital subsidies for transit. The events leading up to the decision included intense civic activism led by well-known local and international figures such as Jane Jacobs, who fought the continuation of the expressway into downtown Toronto.98 Nevertheless, these appeals to halt the Metro Council-approved construction of the Spadina Expressway had all failed until June 3, when Premier Davis announced the now famous lines:

If we are building a transportation system to serve the automobile, the Spadina Expressway would be a good place to start. But if we are building a transportation system to serve people, the Spadina Expressway is a good place to stop. 99

Upon making this statement, the Provincial government bought a thin three-foot strip of land off Eglinton Ave. at the southern end of the already dug trench that prevented further construction southwards and officially stopped the expressway.100 During the following month, the Ontario government passed a new Public Transportation and Highway Improvement Act, 1971 that authorized provincial matching grants to municipalities for up to 50% of local public transit system operating deficits. Together, the cancellation of expressway construction in Metro Toronto and the introduction of public transit subsidies reoriented provincial transportation

98 Schabas, “Deck the Allen,” 19. 99 Christopher Hume, “We define ourselves by our neighbourhoods,” Toronto Star, 30 August 2009. 100 Claire Hoy, Bill Davis, (Toronto: Methuen, 1985), 225. 41 policy towards public transit. This allowed for the slight growth in ridership that had occurred in Metro Toronto during the 1960s to accelerate to record levels. Provincial subsidies not only had the effect of growing ridership but reduced the independence of TTC decision-making by making transit operations structurally dependent on politically controlled governance and funding arrangements. With Metro Council now represented on the TTC Commission, how new Provincial subsidies were to be applied revealed the extent to which operating policies were being shaped by both political and professional interests. Under the initial formula, the TTC’s entire operating deficit would be paid for by Metro. The province would then reimburse Metro for 50 per cent of most costs. In addition, 50 per cent — later raised to 75 per cent — of almost all annual capital expenditures would be covered by the Province. These new subsidies left the TTC flush with cash and Councilors eager to implement changes they had long be advocating for, such as the total elimination of fare zones, which TTC management had opposed because of the negative impact it would have on the TTC’s financial self-sufficiency. The problem of the uncapped operating subsidies initially provided by the Province was immediately apparent to TTC management, who understood that the new lack of fiscal constraints, while well-intentioned, would open the doors to politically expedient rather than fiscally or operationally responsible decisions. As Frisken points out, TTC staff were against the form of the funding as it was first implemented:

As public subsidy became increasingly likely, however, the General Manager of Operations reiterated his long-held position that assistance for the purchase and construction of capital assets was the best way to encourage growth of transit systems and maintain efficient operation. If some form of operating assistance were deemed necessary, he went on, it should take the form of a cost- sharing agreement rather than an ex-post-facto grant to cover all operating deficits. Assistance of the latter type, he maintained, was not conducive to management efficiency ‘and removes the measurement provided by the use of profitability accounting based on sound budgeting.’101 (emphasis my own)

The general manager’s worries that uncapped operations funding would be better spent in capital expansion rather than to cover operating deficits was largely confirmed by 1974, when the TTC’s cost recovery ratio — a standard industry metric of service efficiency — declined from 94 per cent in 1971 to 69 per cent in 1971 following the Province’s decision to make operating deficits

101 TTC General Manager of Operations, “Future Financial Situation of the Commission,” 2 December 1970 in Frisken, “Public Transit and the Public Interest,” 42. 42 from a unified fare structure eligible for the 50 per cent subsidy.102 As a result, increased TTC patronage did not translate into increased revenues which were no longer able to keep abreast of growing operating expenses. In many ways, the introduction of Provincial subsidies and the decline in the TTC’s ability to support operations solely through fares also paralleled the TTC’s loss of independence in operating decisions. As a result of the elimination of fare zones and increased labor costs during the early 1970s, TTC operations now faced a structural deficit that made the agency reliant on government subsidies not guaranteed by legislation to sustain service (see Exhibit 10).103 This loss of independence was demonstrated most clearly by the TTC’s cost recovery ratio, a standard industry metric that measures the percentage of expenditures funded by revenues, which declined to 69 per cent in 1974 from 94 per cent in 1971. This drop was mostly accounted for by the elimination of fare zones, meaning that higher ridership did not translate to higher revenues, and increased labor costs following a 1974 contract renegotiation. During the salary negotiations, TTC management and Commissioners went on strike for 23 days in protest over the wage increases being demanded, which they argued were directly attributable to the availability of open-ended provincial funding.104 Managers and Commissioners were ultimately legislated back to work, with arbitrators setting more constrictive labor work rules and an immediate 16 per cent wage increase, followed by subsequent five and eight per cent increases in the following 16 months.105 As a result, in 1975 total labor costs increased 24.5 per cent from 1974, necessitating a 25 per cent fare increase that same year. It should be mentioned that between 1971 and 1975 TTC patronage increased by 27 per cent to 358 million annual passengers and the number of miles operated increased by 28 per cent to 94.3 million miles operated. However, the cumulative cost of all these new service demands made the TTC inherently reliant on the continuance of significant provincial and Metro subsidies, none of which were guaranteed by legislation. Furthermore, with profitability no longer a concern, the governance structure of the TTC “lost the yardstick of economics” that had historically brought the system such success as a method for ensuring objective decision-making.106

102 Frisken, “Public Transit and the Public Interest,” 45. 103 An action the TTC commissioners and management initially refused to comply with until forced by Metro who replaced several commissioners and reorganized management. See Frisken, “Public Transit and the Public Interest,” 46. 104 Frisken, “Public Transit and the Public Interest,” 48. 105 TTC, 1975 TTC Annual Report, 3. 106 Quoted in Frisken, “Public Transit and the Public Interest,” 45. 43 Taken aback by the dramatic escalation in operating expenses and decline in costs recovered, in 1974 both Metro and the Province moved to distance themselves from blame for what they claimed were management outcomes.107 Metro Council did this through reversing their earlier intention to become a more visible presence on the Commission by appointing fewer

Exhibit 10: TTC Revenues versus Labor Costs, 1971-1975

Source: TTC Annual Reports, 1971-1975 elected councilors. Furthermore, talks ended over integrating the TTC into the Metro bureaucracy rather than have it remain a separate “body corporate.”108 In turn, the provincial government looked to revise its funding formulas to encourage greater operating efficiency and limit further cost escalations. In 1976, the “users’ fare share formula” was adopted across Ontario, which capped the percentage of operating expenses eligible for subsidizes at a level linked to the

107 Actions which had brought management morale to an all-time low, as a consultants report noted. See Frisken, “Public Transit in the Public Interest,” 47. 108 Frisken, “Public Transit in the Public Interest,” 47. 44 population of the jurisdiction being serviced (See Exhibit 11). As a result, only two Metro Council members were appointed to sit on the five person Commission during 1975 and 1976 when fares were increased by over 60 per cent so as to meet the new operating cost recover targets. This target was set at 72.5 per cent, with the provincial government reimbursing Metro

Exhibit 11: Provincial Public Transit Operating Subsidy, 1976 Basic Subsidy as Revenue/Operating Theoretical Municipalities Population % of Operating Cost Target Deficit Affected* Expenses Markham, Pickering, 0-100,000 50% 50% 25% Richmond Hill,

100,001-150,000 55% 45% 22.50%

150,001-200,000 60% 40% 20% N/A

200,000-1,00,000 65% 35% 17.50%

1,000,001 and up 72.50% 27.50% 13.75% Metropolitan Toronto

*Not a comprehensive list Source: The Regional Transportation Policies Task Team, “Regional Transportation Policies,” (1979), Appendix B.

Council for no more than 13.5 per cent, or approximately half, of the outstanding expenses, leaving Metro Council responsible for the difference.109 The fare increases contributed to a ridership decline of 20 million passengers between 1975 and 1978. However, this switch from a funding formula based on the total deficit to one based on expenditures and an agency’s ability to meet a cost recovery target re-empowered management by making their own knowledge base for running efficient transit services valuable once more. Furthermore, with set performance targets and a predictable funding stream, the foundation was laid for sustainable service increases. This occurred through the creation of operating standards and incremental fare increases that kept up with inflation to ensure the TTC met its targeted cost recovery ratio, which was later reduced to 68 per cent. To meet these targets set in the formula tightening, TTC fares were increased 33 per cent in 1975 and 25 per cent in 1976,110 contributing to a six per cent decline seen in ridership between 1975 and 1978 despite 4.4 million new miles of service. Despite these brief losses, the new funding formula established a predictable stream of subsidies that provided the foundation for a decade of ridership growth and fiscal expansion.

109 TTC, 1976 TTC Annual Report, 2. 110 TTC, 1975 TTC Annual Report, 3 and TTC, 1976 TTC Annual Report. 45 With funding now tied to performance targets, TTC management created new operating metrics to combat the politicization of transit decisions and ensure new services did not occur at the expense of operating efficiency. In 1976, Michael Warren took over as the new Chief General Manager of the TTC, a provincial civil servant without experience in public transit.111 He began experimenting with “route criteria and service standards” that could more equitably and efficiently guide route decision-making and service levels and better shelter TTC staff from the influence of politics.112 Under Warren, “economic yardsticks” for operations were re-established by drawing upon the TTC’s historical operating philosophy. Following in the tradition of the “equity principle” put in place following the public takeover in 1921, what later became known as “crowding standards” were implemented. These standards set minimum Metro-wide service levels based on walking distance, ridership levels, neighborhood transit dependency (income) and travel times. These standards allowed for the equitable distribution of funding based on an area’s access to transit, their observed demand for transit and the planning goals of Metro Toronto.113 They also enabled TTC staff to defend their operating decisions against the political demands of local councilors for preferential service to their areas. As Mitch Stambler, the Chief Planning Officer for the TTC, explains:

The standards have served the city well because it meant that there’s always a clear quantifiable explanation for why every area gets the service it gets. And when we would meet with city councilors who would make the complaint that, ‘how come they get more,’ we would say, ‘they get more because they use it more, and if your people use it more, they’re going to get more.’”114

With predictable funding and service closely reflective of observed demand for transit,115 projected ridership increases could properly be budgeted for and supply-led service could be targeted to where the Official Plan for Metro Toronto intended. Understood within the new governance arrangement of the TTC, the new operating standards re-established TTC expertise as the basis for future service expansion, ensuring that political goals would not be accomplished at the expense of operating efficiency or declines in existing services.

111 Frisken, “Public Transit and the Public Interest,” 49. 112 TTC, 1976 TTC Annual Report, 10. 113 TTC, 1976 TTC Annual Report, 10. 114 Interview by the author of Mitch Stambler, March 15, 2012. 115 Stambler noted that the TTC makes approximately 10 service changes per year, significantly more than most similar sized operating authorities, and most routes in the system are counted on a quarterly basis, which allows operations to be more adaptive to changes in trip patterns (Interview by the author of Stambler). 46 Freeing capital subsidies used for system expansion from political influence proved more challenging for TTC management. When it came to deciding how to spend capital subsidies and plan new services, the influence of both Metro and the provincial government often countered TTC service expansion principles that had historically brought success to the agency. This was seen most clearly in the new service initiatives, capital project route alignments and technology selected for TTC system expansion. Following provincial pressure, new dial-a-bus routes and express bus services were initiated in 1972 against the advice of TTC staff, only to be eliminated by the mid-1970s.116 The alignment chosen for the Spadina subway extension was an even clearer example of form — or route — following finance. The TTC, following their earlier policy of upgrading service on routes with the necessary observed demand, advocated for building a subway extension underneath the heavily used Bathurst Street corridor into North York. Instead, in 1973 Metro approved a route recommended by a joint Metro/provincial committee of transportation officials where the subway would run along the surface of an empty trench down the median of the partially built Spadina Expressway (see Exhibit 12). The subway would then curve south underneath a deep ravine surrounded by low density residential neighborhoods.117 This choice was likely influenced by the lower capital costs required from the Province and for the fact that it also made future expressway construction along the route more likely by preserving the right of way from development.118 This second factor gave the trench-ravine alignment strong support from suburban politicians who by then dominated Metro Council.119 As a result, today the stations on this portion of the subway system between Eglinton Ave. and Wilson Ave. have some of the lowest use rates in the entire system.120 Another example of form following finance was the construction of an eastern extension to the east-west subway line using untested technology that proved to be of limited benefit to TTC operations. A new intermediate capacity transit system was built into Scarborough, a suburban borough of Metro, by the Urban Transit Development Corporation (UTDC), the Ontario government-owned transit manufacturer created in the 1970s to spearhead the provincial

116 TTC, 1972 and 1975 TTC Annual Reports. 117 Frisken, “Public Transit and the Public Interest,” 51. 118 This ultimately came true for a portion of the route between Lawrence and Eglinton where a four-lane road extended the highway south to the Ravine. 119 Frisken, “Public Transit and the Public Interest,” 51. 120 Schabas, Jake. “Deck the Allen,” 20. However, plans at that time were being championed by the provincial government to build new housing and commercial developments overtop of the trench where the subway ran. This may have improved the currently low rates. 47 government’s new transit-oriented industrial development policy. This line, today known as the Scarborough Rapid Transit (SRT), was built to showcase the new transit technology being

Exhibit 12: The Spadina Subway Line along the Partially build Spadina Expressway median.

Source: Allen_nosky, “Allen_nosky.png,” accssed on 23 February 2012. developed by UTDC to prospective international buyers. However, it was built on an elevated structure using a different than the rest of the subway system, with curves that could not be handled by existing subway cars. These factors made subway-SRT interoperability impossible and transfers inconvenient. The technology was ultimately retired from regular production, making SRT car replacement prohibitively expensive for the lower ridership seen on the route. Today, the SRT is being replaced by a more traditional surface Light Rapid Transit line. Together, these capital decisions increased the TTC’s long-term reliance on both capital and

48 operating subsidies, despite the fact that the long-term existence of subsidies was by no means assured. Tempering these politically motivated decision were the uses of capital funds to expand the transit system in ways that supported earlier operating philosophy through purchasing new rolling stock and improving transferability between different modes. Building on the TTC’s history of facilitating easy intermodal transfers, new subway stations were built to provide barrier-free transfers between buses, subways and streetcars. Vince Rodo, the current General Secretary of the TTC, points to the construction of subway stations such as St. Clair West as an example of this use of capital funding furthered operating goals:

The very best example of it is if you go to St. Clair West Station (see Exhibit 13). There is no better example of the integration of transit maybe in the world than right there where you get off the subway [and] a streetcar or a bus comes in and you just go from one vehicle to the next. There’s no barrier. It’s called barrier-free transfer, and that’s how everybody’s building transit now.121

Rodo’s emphasis on the importance of easy transfers is echoed in academic literature; studies have highlighted how public transit systems with high transfer ratios often exist in cities with high per capita ridership, such as Boston, Paris and Zurich.122 A similar increase in ridership was seen in New York City following the implementation of free transfers from buses to subways in 1997.123 In the case of Toronto, Mees points specifically to measurements of unlinked trips as opposed to linked trips — where a linked trip from one’s origin to destination is comprised of unlinked trips connected by transfers — which shows how TTC unlinked trips increases outpaced ridership linked trip growth from 480 million in 1970 to 869 million in 1990.124 The TTC’s early adoption of this philosophy of easy transfers — even at great expense, as is demonstrated by St. Clair West Station’s vast underground intermodal hub where streetcars and buses circle on top of subway platforms — likely stems from the ’s early coordination of buses and rail so as to provide riders with free, convenient transfers. Continuous rolling stock upgrades made possible by provincial capital subsidies further supported these operating policies (see Exhibit 14), allowing for regular fleet renewal and expansion. As a result, TTC management

121 Interview by the author of Vince Rodo, 16 March 2012. 122 Vuchic, Transportation for Livable Cities (1999), 209, quoted in Mees, Transport for Suburbia, 85. 123 Bruce Schaller, “Commuting, Non-Work Travel and the Changing City: An Analysis of Census 2000 Commuting Results for New York City,” (Brooklyn: Schaller Consulting, June 2002), 8, accessed on 23 February 2012, http://www.schallerconsult.com/pub/commute.pdf. 124 Mees, Transport for Suburbia, 92. 49 Exhibit 13: St. Clair West Station Intermodal Transfers

Source: R. Flores, “M_20111209_IMG_9534,” accessed 23 February 2012 believe that approximately 60 to 70 per cent of TTC trips involve a bus for all or part of the journey.125 This use of capital subsidies to support the historic operating practices developed by the TTC to extend high quality service to lower density areas, when combined with incremental fare increases, enabled the public transit system to flourish. The result of these service standards and emphasis on using capital funds to upgrade rolling stock and facilitate easy intermodal transfers meant that new transit services extended into the suburbs were not made in exchange for service declines in the inner city. While investment was focused in the suburbs — all subway construction, for example, during this period took place in suburban boroughs — this did not negatively impact downtown areas, which benefited from rolling stock upgrades and greater access to suburban areas where employment was increasingly locating. Importantly, fares were consistently set to cover approximately 68 per cent of operating expenses, meaning that they generally only increased at the rate of inflation during this period

125 Interview with Mitch Stambler. 50 (see Appendix).126 Therefore, with a stable funding structure and service expansion following historically tested operating principles, the 1970s and 1980s in Toronto demonstrated how regional governance could facilitate widespread public transit use in spite of low densities and the appeal of the automobile if supported through provincial funding. This was done through a governance model that provided the TTC with the resources and independence to

Exhibit 14: Change in TTC Vehicle Fleet, 1971-1990

Source: TTC Annual Reports, 1971, 1990 accomplish political goals in an operationally efficient and financially responsible manner. The key mechanism that accomplished this was the “users fair share formula,” which set performance standards that empowered TTC staff to keep operating efficiency high while allowing for political goals to be accomplished. Furthermore, with Metro forced to pay for all additional operating deficits above the 13.5 per cent threshold, there was a structural incentive built into the funding formula to ensure TTC capital decisions would not drive up operating costs — although this did not always occur. Ultimately, provincial support for transit through a funding formula

126 Interview with Vince Rodo. 51 that empowered local transit operators to expand the system based on historic operating policies was the central driver of the TTC’s success during the 1970s and 1980s. As a result, this success had the unintended consequence of making the TTC structurally reliant on provincial subsidies to maintain its service levels — a situation by no means guaranteed by legislation. The importance of this fact would be made clear in the 1990s, when the provincial withdrawal of subsidies for transit decimate the system that had become built dependent on provincial funding to support its services.

Growing Regional Fragmentation While Metro Toronto was becoming more transit oriented, in the faster growing areas outside its borders transit use was in decline as the region grew more fragmented. Beginning in the 1970s, the Province began establishing new two-tiered regional governments in the quickly growing areas surrounding Metro Toronto.127 In 1970, the Regional Municipality of York was created just north of Metro Toronto and between 1973 and 1974, the Regional Municipalities of Halton, Peel and Durham were also established, fragmenting the urbanized area (see Exhibit 15). Soon many municipal governments and municipally owned transit systems would exist in the Greater Toronto Area.128 Pill attributes the Provincial decision to limit Metro Toronto’s jurisdiction, already home to one quarter of Ontario’s population in 1961, by creating multiple new regional governments to the perceived challenge an expanded Metro government would pose to provincial power.129 As a result, local transit coordination between the regional municipalities remained fragmented despite an increasing need to address cross-border travel, which was rapidly growing (see Exhibit 16). As a 1979 report states:

The lack of coordination between various types of urban development has resulted in a greater ‘need’ for interregional travel that is constantly increasing as the outlying areas undergo further development. This increasing ‘need’ for travel has made evident the difficulties existing agencies have, under present jurisdictions, in efficiently coordinating interregional service and therefore, effectively accommodating the growth in interregional transit movements.130

127 Frisken, The Public Metropolis, 113. 128 John Dakin. “Metropolitan Toronto Planning,” The Town Planning Review 40:1, (April, 1969), 3. 129 Pill, Planning and Politics, 24-25. 130 The Regional Transportation Policies Task Team, “Regional Transportation Policies: A staff report submitted to the Joint Metro/T.T.C. Transit Policy Committee,” September 1979, 2. 52 The calls for increased transit coordination were nevertheless met with provincial inaction. No expanded regional body was instituted, and instead greater fragmentation was encouraged through the high operating subsidies provided to local suburban transit operators and by

Exhibit 15: The Greater Toronto Area Regional Municipalities and Urbanized Area, late 1980s (clockwise, Halton, Peel, York and Durham surround Metropolitan Toronto)

Source: White, “The Growth Plan for the Greater ,” 35.

investments in a Provincially operated commuter rail and regional bus service.131 This strategy proved incapable of stemming the decline of per capita public transit ridership outside Metro Toronto, which was otherwise masked by the high per capita ridership gains being made within Metro Toronto (see Exhibit 17). This meant that no alternative to cars was provided for interregional trips except those into the core, leading to declines in per capita transit ridership in the new areas outside Metro’s borders.

131 Between 1976 and 1984, provincially operated commuter bus and rail service increased from 1321 miles (2,126 kilometers) of routes to 9053 miles (14,570 kilometers). See Frisken, The Public Metropolis, 157. 53

Exhibit 16: Vehicles and Person Trips Crossing Metro Boundary, 7:00AM to 7:00PM, Two Way Totals, 1975-1977 1975 1977 % Increase Total Vehicles 581,423 670,691 15.35%

Total Person Trips by Auto* 629,182 721,063 14.60% Total Person Trips by Transit** 65,386 90,883 38.99% Total 694,568 811,946 16.90%

Modal Split 9.40% 11.20% 19.10%

*Vehicle flows include private autos, taxis, trucks and buses, including inter-urban buses, but do not include commuter rail cars.

**Person trips include private auto, taxi, bus, commuter rail passengers and private auto drivers. Drivers of taxis, trucks and transit vehicles are not included.

Source: Metropolitan Toronto Planning Department - Transportation Division, Metro Cordon Count Program - 1977, December, (1977), 3. Table 1.

Exhibit 17: Transit Ridership and Population Change in the Greater Toronto Area, 1981-1985/6 Total Public Change in Population Ridership Municipality Population Transit Ridership Ridership per Growth per Capita (public transit) (1986) Growth (1981- Capita (1981- (1981-1986) (1985/86) 1985) 1985/86) Toronto (TTC) 2,192,700 2.59% 9.56% 197.1 6.79% Toronto Suburbs* 1,963,600 16.08% 6.12% 32.1 -8.58% (All Local Transit) Commuter Services** (GO 4,156,300 15.78% 15.70% 6.2 -52.91% Transit) Total 4,156,300 8.55% 9.42% 125.3 0.80%

*Suburbs include Durham Region, York Region, Peel Region, Halton Region and Hamilton- Wentworth Region ** Includes entire Greater Toronto Area Source: Compiled from Current Issue Paper #62: Transportation Planning and Coordination in the Greater Toronto Area (Sept. 1987) - Prepared by Jerry Richmond, Research Officer, Legislative Research Service, ISSN 0835-0299, 18,21.

The inability of Toronto’s Metropolitan government to remain the governance body for the entire region limited transit use across the region and speaks to the shortcomings of a formal regional governance structure. Entirely dependent on provincial legislation for reforms that it had little influence in shaping, Metro Toronto became increasingly irrelevant as a regional government following 1967. This one-sided power relationship meant that despite achieving

54 incredible growth in transit use within their borders, Metro Toronto was incapable of addressing growing auto dependence in the faster growing areas outside its jurisdiction. While this did not stop per capita ridership within the entire census metropolitan area from increasing, it precipitated the future marginalization of transit within the region as the areas outside Metro Toronto expanded.

The End of an Era: Ridership decline and the dissolution of Metro The events of the late 1980s and 1990s in Toronto gave evidence to the inherent weakness of a formal metropolitan government structure that lacks jurisdictional or fiscal autonomy. In 1988, another round of reforms were made by the Province to Metro Toronto’s governance that slightly modified its voting structure and kept its original 1953 jurisdiction in place. The new legislation also saw the creation of an Ontario Government Office for the Greater Toronto Area; a small group of civil servants tasked with uniting the disparate parts of the Provincial government bureaucracy whose work affected the Greater Toronto Area.132 Their jurisdiction comprised an area of 2,780 square miles and the regional municipalities of Toronto, Durham, Peel, Halton and York and in 1991 had a total population of 4.2 million.133 These changes consolidated control over the emerging Greater Toronto Area into provincial hands and left Metro as merely the largest of several regional government bodies for the area. These changes also helped to precipitate a shift in transportation policy that further allowed regional public transit use to deteriorate both within and outside of Metro Toronto. Beginning in 1989, a perfect storm of challenges devastated public transit within Toronto, including an economic recession, a labor work stoppage, fare hikes and poor policies that further discouraged ridership. Toronto was hit particularly hard by the affects of the North American Free Trade Act as many American corporations who formerly had their Canadian headquarters in Toronto no longer found such physical presences there necessary.134 Employment plunged along with ridership, which TTC staff point out is extremely correlated with employment due to Toronto’s strong core (See Exhibit 18).135 As a result, 1989 was the first year in eleven years that ridership declined — although this was likely more due to a 41-day labor strike than it was to

132 Sancton, Merger Mania, 113. 133 Golden, Anne. Greater Toronto: Report of the GTA Task Force, Toronto: The Task Force, 1996, 23; Sancton, Merger Mania, 113-4. 134 Christopher Sanderson and Pierre Filion. “From Harbour Commission to Port Authority: Institutionalizing the Federal Government’s Role in Waterfront Redevelopment” in Reshaping Toronto’s Waterfront, edited by Gene Desfor and Jennifer Laidley, (Toronto: University of Toronto Press, 2011), 232. 135 Interview with Vince Rodo. 55 economic conditions, which were still good — causing the TTC to not meet its targeted cost recovery ratio. In response, the province increased its operating subsidy to Metro Toronto.136

Exhibit 18: TTC Ridership and Toronto Employment, 1998-2011

Source: TTC General Secretary Vince Rodo

However, in 1990, while ridership increased it still did not meet budgeted predictions, resulting in another operating deficit. Over the next three years, the TTC implemented significant cuts to service with the idea that this tactic would return the Commission to its targeted cost recovery ratio. As a result, between 1990 and 1993 service kilometers were cut by 16.6 million, all of the TTC’s last 139 Trolley buses were retired and not replaced and the bus fleet itself was further reduced by 180. Most severe of all may have been the hike in cash fares, which rose from $1.30 to $2.00 in 1992 which calculated for inflation represented a dollar increase in 2012 Canadian

136 TTC, 1989 TTC Annual Report, 11. 56 dollars, an unprecedented rise (see Exhibit 19). However, none of these policies were able to halt ridership decline, which continued even after employment had begun to recover in 1995. As Stambler explains, “the catalyst [for ridership decline] may have been the economy going in the toilet, but the TTC absolutely shot itself in the foot over and over again.”137 By 1996, seven years of ridership decline and service cuts had erased almost ten years of ridership growth, returning the TTC to patronage levels mirroring those seen in 1980. Escalating the TTC’s troubles further was the removal of provincial funding from public transportation in Ontario. Despite strong relations between the TTC and Metro during the early 1990s, as David Gurin, chief planner for Metro Toronto between 1991 and 1998, confirms,138 the key partner for ensuring transit funding had since the early 1970s been the Province. Relationships with the province were initially strong at the recession’s onset, but they quickly

Exhibit 19: TTC Operating and Financial Statistics, 1990-1996 Service Passengers Cost Cash fare with Total operated Year (millions of Recovery inflation (CAN$ Fleet (millions of linked trips) ratio 2012) Size kms) 1990 459.2 195.2 65.8% $1.89 2803 1991 424.2 188.0 65.4% $1.91 2712 1992 404.3 183.5 62.2% $2.90 2549 1993 393.5 178.6 65.6% $2.84 2481 1994 388.3 179.1 66.2% $2.80 2481 1995 388.2 178.5 68.1% $2.79 2440 1996 372.4 172.1 75.3% $2.74 2441 Source: TTC Annual Reports, 1990-1996 deteriorated first under recessionary pressures to reduce funding and then following the 1995 election of a new Ontario government. The new Premier had campaigned on a “common sense” platform that involved the realignment of provincial and municipal services. Once elected, Harris moved to eliminate annual operating subsidies that had been as high as $117 million in 1992 and by phasing out all capital contributions, which had peaked at $145 million in 1985, by 1998. A 50 per cent operating subsidy for Wheel-Trans, the TTC operated door-to-door service for disabled riders that in 1997 the Province had provided $17.6m for, was also eliminated.139 As a result, all of the TTC’s operating and capital subsidies became entirely the

137 Interview with Mitch Stambler. 138 Interview with David Gurin, 27 March 2012. 139 To explain the motivations driving these decisions, much has been written. Although much of Harris’s support during the 1995 elections was in the suburbs outside of Metro Toronto, his Progressive 57 responsibility of Metro, which had already been struggling under the effects of the recession. The changes caused the immediate and permanent cancellation of ongoing construction on a new cross-town subway line under and placed heavy financial burdens on Metro Toronto without providing any new funding streams or fiscal authority to create new revenue tools. 1998 also saw the dissolution of metropolitan government in Toronto into an amalgamated City of Toronto. In a unilateral act by the provincial government that was opposed in a Metro referendum by 76 per cent of voters,140 Toronto’s governance system was reformed as a megacity, a single-tiered system with 58 independent councilors and a weak mayor, all of who had one vote in all decision-making matters presented to council.141 The amalgamation of Metro Toronto into the City of Toronto has been described as “probably the greatest realignment of powers in the history of the [Canadian] municipal system.”142 More fragmented than ever before, the new megacity emerged from 1998 with added fiscal responsibilities yet without new revenue tools,143 the largest example of which was the TTC’s capital subsidy needed simply for regular asset replacements and rolling stock upgrades to keep the system in a state of good repair. City documents from 1998 reported that, “at an estimated impact of $180 million per year, the [TTC’s provincial capital] subsidy loss is the single largest budget pressure the City has ever faced.”144 As a result, total operating and capital subsidies to the TTC were drastically reduced, forcing the TTC to rely on fare box revenues to fund over 80 per cent of its operating expenses — by far, the highest of any urban public transit system in North America.145 At no other time were the limitations of a formal metropolitan government structure’s ability to encourage public transit use more clear than during its dissolution, when control over a transit system now heavily dependant

Conservative party had nevertheless won 16 of the 30 ridings within Metro Toronto’s boundaries. Julie- Anne Boudreau has therefore argued that these restructuring policies should be understood as “solidly grounded in the neoliberal discourse on globalization,” where municipal restructuring aimed to “respond to the changing economic and political context.” See Boudreau, Megacity Saga, xv, 3, 68. 140 Approximately one quarter of all residents voted in the referendum, with more than 76 per cent voting against amalgamation. See Frisken, The Public Metropolis, 254. 141 Sancton, Merger Mania, 155. 142 Siegel, David. “Ontario,” in Foundations of Governance: Municipal Government in Canada’s Provinces, edited by Sancton and Young. (Toronto: University of Toronto Press, 2009), 31. 143 Slack, Enid. “Easing the Fiscal Restrains: New Revenue Tools in the ,” Institute on Municipal Finance and Government, Toronto: University of Toronto, 2005. 2-3 http://ideas.repec.org/p/ttp/itpwps/0507.html 144 City of Toronto, “Report No. 6 of the Strategic Policies and Priorities Committee,” April 28, 1998. http://www.toronto.ca/legdocs/minutes/council/appa/cc980429/sp6rpt.htm. 145 TTC History, PowerPoint presentation, December 2003. Accessed through Vince Rodo, General Secretary of the TTC in March, 2012. 58 on subsidies was transferred entirely to local government without the fiscal means to raise the revenues required for its maintenance, let alone expansion. Following the amalgamation of Metro Toronto, regional governance increasingly became a function of the provincial government in Ontario, particularly when it came to planning, coordinating and constructing public transportation. The 1998 decision to end the half-century long experiment in regional government came despite renewed calls for new regional government legislation that would again create a formal institution for regional governance in the Toronto area. This recommendation was most clearly articulated by the provincially commissioned Golden Report, released in 1996, which argued the province should simply reform the 1953 Municipality of Metropolitan Toronto Act and extend the model to the entire Greater Toronto Area. The report claimed that reforms to Metro in 1967, to surrounding regions in the early 1970s and then to Metro again in 1988 demonstrated the flexibility of the government model to adapt to new conditions.146 Whether the continuance of this pattern would have been beneficial for public transit — the last two reforms do not appear to have been — in the region is unclear, however the report was largely ignored. Instead, the provincial government pulled its involvement out of all public transit services, which were now declining across the urbanized area (see Exhibit 20), and left the region more fragmented than it had been in over fifty years. Since the dissolution of Metro Toronto and the withdrawal of the provincial government from public transit in 1998, total transit use in the Census Metropolitan Region surrounding Toronto has remained static. More recently a new regional transit authority, , was created by the provincial government in 2006 to “provide leadership in the co-ordination, planning, financing, development and implementation of an integrated, multi-modal transportation network” that complies with an enforceable growth plan for the region, the Places to Grow Act, 2005.147 In 2008, , a regional transportation plan, was approved by the Metrolinx Board of Directors made up of 40 mayors, transit chairs and locally appointed representatives, which has begun to be implemented throughout the urbanized area. Seen together, the leadership role taken by the province in matters of urban land use and transportation coordination have led many to believe that “the province is the regional government.”148 The new

146 Golden, Greater Toronto, 23. 147 Government of Ontario. Metrolinx Act, 2006, 8.1-4. Accessed on 23 February 2012. http://www.e- laws.gov.on.ca/html/statutes/english/elaws_statutes_06g16_e.htm, 148 Interview with Paul Bedford, 16 March 2012. 59 leadership role has been reflected by the partial implementation of PRESTO, a regional smart card, for fare payment on the commuter rail and local suburban transit systems, as well as

Exhibit 20: Travel Modes in Toronto versus the Greater Toronto and Hamilton Area (GTHA), 1998-2006 Walk Auto Auto Local & Population # of Trips Driver Passenger Transit GO Cycle Other Toronto 2,445,900 4,786,200 53% 15% 23% 0% 8% 2% 2006 GTHA 5,871,900 12,244,700 63% 16% 12% 1% 6% 2% Toronto 2,368,700 4,763,900 54% 14% 22% 0% 8% 1% 2001 GTHA 5,386,100 11,515,300 64% 16% 11% 1% 6% 2% Toronto 2,305,600 4,522,800 53% 15% 22% 0% 8% 1% 1996 GTHA 4,926,400 10,105,400 62% 16% 12% 1% 7% 2% Toronto 2,125,000 4,163,200 53% 13% 25% 0% 7% 1% 1986 GTHA 4,062,900 8,213,000 60% 14% 16% 1% 7% 2% Source: Transportation Tomorrow Survey, 1986-2006. provincial funding for all new transit system upgrades and expansions passing through Metrolinx, which then designs and constructs the new lines. While local public transit operators still exert influence over the selection of future lines, the formation of Metrolinx has made clear that rather than empowering local municipalities with additional political authority over transit, power over regional transportation policy is now centralized in the provincial government. The creation of Metrolinx in 2006 represented the culmination of increasing provincial interest over regional transit policy-making that had begun in the late 1960s with the launching of a separate, provincially operated commuter rail service. Furthermore, it reflected the shortcomings of a formal metropolitan governance model where provincial rather than local support for transit guided Metro Toronto’s ability to increase regional transit mode shares. Should Metro Toronto have had the ability to either increase its own jurisdiction to encompass the entire urbanized area, as local politicians had wanted in the 1960s, or have been able to raise new revenues to subsidize suburban expansion, the structural reliance on provincial support for transit support would not have been needed to have achieved such high regional use of transit. The sustainability of a formal metropolitan government model that supports public transit is therefore limited entirely by the extent to which its transportation goals match those of the provincial government.

60 Chapter 3: Institutional Innovation in Vancouver Transportation

Summary The story of public transit in Vancouver highlights how the absence of formal regional government structures or local legislative authority over transit does not preclude regional transportation solutions that favor increased transit use. Instead, the lack of local control over both planning and transportation functions until the 1990s forced municipalities in the greater Vancouver area to create transportation plans that had widespread regional support. This placed political pressure on the provincial government to devolve transportation responsibilities to a locally governed regional body along with sufficient power to raise revenues to the extent supported by local municipal governments. As a result, in 1999 the Provincial government formed TransLink, a regional transportation authority with responsibility for all transportation services in the Greater Vancouver Regional District along with significant revenue raising abilities. Under TransLink, transit use has greatly increased throughout the region, however these gains have been constrained by Provincial government actions to further limit the authority’s revenue raising ability — actions seen most clearly in the failure of the vehicle levy revenue mechanism and the resulting need for provincial funding for new capital projects. Similar to Toronto, the success of public transit in the Vancouver region over the last decade demonstrates how public transit agencies with sufficient jurisdictional and fiscal autonomy can vastly increase the use of public transit in metropolitan regions. However, as in Toronto although to a lesser extent, the sustainability of increased public transit use remains dependent on provincial action (or inaction through the devolution of powers) to support local transportation goals.

Early History: Cooperative Regional Governance In contrast to the Toronto case study, the Vancouver metropolitan region has a long history of municipal cooperation through voluntary governance structures rather than formal legislative structures to accomplish regional goals. Vancouver is the most populous of the province of British Columbia’s cities and is located in the southwest corner of Canada in an area known as the Lower Mainland. British Columbia is distinct among Canadian provinces in that it lacks a history of unilateral rearrangements to the boundaries and structure of municipal governments under its authority.149 Instead, beginning in 1911, the City of Vancouver and its neighboring

149 Andrew Sancton, The Limit of Boundaries: Why City-regions Cannot be Self-Governing, (Montreal: McGill-Queens University Press, 2008), 105-6. 61 municipalities have voluntarily formed special districts to provide services such as water, sewerage and achieve shared aims in areas like parks, hospital construction and air quality. Provincial legislation has repeatedly validated municipal coordination initiatives and only occasional acted to limit the authority of these informal regional structures — a style of governance commentators have described as “gentle imposition.”150 The clearest example of this style was in 1965 when the Province of British Columbia amended the Municipal Clauses Act, 1892 and enabled local governments to form regional districts with an official name and assigned functions that municipalities could “opt out” of if they wished.151 This directly contrasts the Ontario government’s approach, where regional governments were created and reformed exclusively by the Province with or without the support of the affected local governments. This difference between Ontario’s formal regional government structure and British Columbia’s (B.C.) system of more informal governance where reforms are locally derived and provincially validated is fundamental to understanding regional policy formation in the Lower Mainland region. In 1967, the Regional District of Fraser-Burrard — later renamed the Greater Vancouver Regional District (GVRD) — was formerly recognized under the province’s 1965 regional district legislation, becoming the most urbanized of the 29 regional districts that would ultimately be officially recognized (see Exhibits 21 and 22).152 Initially, the provincial minister of municipal affairs “took great pains to deny that a regional government was being created,” with other more rural regions established first and the new GVRD following the existing boundaries of a Hospital Special District rather than having its own unique jurisdiction.153 Today, what is known as Metro Vancouver is an area encompassing 22 municipalities, one electoral area and one Treaty First Nation all linked through an informal governance body that administers agreed upon services to the entire region. Metro Vancouver is administered by a Board of Directors of elected representatives appointed by each municipality, First Nation or voted upon directly by electoral area. The Metro Vancouver board enacts regional policies based on a voting structure that is weighted by population, with each board member having one vote for every 20,000 residents they

150 Patrick J. Smith and Kennedy Stewart, “British Columbia,” in Foundations of Governance: Municipal Government in Canada’s Provinces, edited by Sancton and Young. (Toronto: University of Toronto Press, 2009), 282. 151 Artibise, Cameron and Seelig, “Metropolitan Organization in Greater Vancouver: ‘Do it Yourself’ Regional Government,” in Phares, Regional Governance without Regional Government?, 199. 152 Artibise, Cameron and Seelig, “Metropolitan Organization”, 199. 153 Artibise, Cameron and Seelig, “Metropolitan Organization”, 199. 62 represent to a maximum of five votes and larger municipalities having multiple directors.154 For its services, which today include sewerage, water, parks and housing, Metro Vancouver charges municipalities a general levy based on the services received. Participation in regional services is voluntary, with all municipalities allowed to “opt out” of receiving services and therefore not be charged the fee.155 Service functions can be delegated up to Metro Vancouver and added to the general levy only if they receive the approval from the majority of the board. Similar to Metro

Exhibit 21: Municipalities in the Greater Vancouver Regional District (GVRD)

JONS BAY ELECTORAL AREA A

NORTH VANCOUVER BOWEN WEST DISTRICT ISLAND VANCOUVER BELCARRA ANMORE NORTH VANCOUVER CITY PORT MOODY ELECTORAL AREA A PORT VANCOUVER BURNABY COQUITLAM MAPLE RIDGE COQUITLAM PITT MEADOWS

RICHMOND SURREY

LANGLEY CITY DELTA

WHITE ROCK LANGLEY TOWNSHIP Source: CBC, “British Columbia: Election Connection,” accessed 23 February 2012.

Council in Toronto, because politicians must first be elected by their local constituency before being appointed to the GVRD board, it has been argued that this “seems to free GVRD board members to take more controversial stands at a regional level than they might do at the local level” where it could threaten their reelection chances.156 In this way, the institutional structure

154 Artibise, Cameron and Seelig, “Metropolitan Organization”, 205. 155 The one exception is regional Hospital construction, which municipalities are required to contribute towards. 156 Artibise, Cameron and Seelig, “Metropolitan Organization,” 206. 63 established to govern the Vancouver region was informal, with regional leaders forced to rely on their ability to make the case for the increased efficiency and economy of regional service delivery.

Exhibit 22: Regional Districts in British Columbia, 2005

Source : Regional Districts in British Columbia. Wikipedia. Accessed 23 February 2012.

The GVRD gradually expanded its responsibilities after its creation in 1967 into a multifunctional regional governance body that relied on consensus-building to implement its policies. Initially limited to hospital construction and regional planning, soon GVRD functions included borrowing on behalf of municipalities (1968), air pollution control (1972), parks (1972), public housing (1972), solid waste disposal (1973) and collective labor relations (1974), all of which were approved by the provincial government.157 Interestingly, in 1971 the GVRD had requested it become responsible for public transit in the region, which was then mostly run by the B.C. government and small municipally owned operators, however the request was denied by the

157 Artibise, Cameron and Seelig, “Metropolitan Organization,” 206. 64 province — the only function requested by the GVRD to be refused.158 Prior to 1967, land use and transportation planning for the GVRD and three surrounding regional districts was conducted by the Lower Mainland Regional Planning Board (LMRPB). This organization produced an Official Regional Plan for the Lower Mainland that included transportation and was formally adopted by the municipalities within its jurisdiction in 1966. However, the LMRPB was dissolved by the B.C. government in 1967 and replaced by four separate regional districts — paralleling the creation in Ontario during this time of multiple regional municipalities — one of which was the GVRD. It has been argued that this move by the province was a response to LMRPB’s growing power following the success of its Official Regional Plan, which had openly criticized provincial land-use policies.159 This early history of Metro Vancouver exemplifies both the unique informal governance structure in place for the region as well as transportation’s unusual status as the sole exception of regional services not provided by a coalition of local governments.

‘Do it yourself planning:’ Transportation during the 1970s-1990s In spite of the dissolution of the LMRPB, regional planning that encompassed all four regional districts continued in the 1970s through a broad-based public consultation process entitled the Livable Region Programme. This program developed a land use and transportation plan for the greater Vancouver region that had strong local support and was adopted by the municipalities in all four districts in 1975. Robert Cervero has noted that the Livable Region Programme’s forward thinking policies — these included encouraged transit-oriented growth, a hierarchy of town centers and a wide range of housing choices all linked by high capacity transit while discouraging single occupancy auto trips — have made it “widely considered a landmark in the annals of city planning.”160 The 1975 Livable Region Plan was updated in 1980, however in 1983 a land use dispute between the GVRD planning department and the B.C. government over provincial actions to remove land from an Agriculture Land Reserve outside Vancouver led the province to revoke all planning authority from regional districts in 1983. This reversed the legality of all currently adopted plans, including the highly supported Livable Region Programme, throwing regional planning into a period of uncertainty. These land use struggles were reflective of a national trend that can also be seen in Metro Toronto’s interest in expand its boundaries during

158 Artibise, Cameron and Seelig, “Metropolitan Organization,” 206. 159 Artibise, Cameron and Seelig, “Metropolitan Organization,” 200. 160 Cervero, The Transit Metropolis, 423. 65 this time demonstrating how “the stakes over land use [had] become higher and higher as the implications of land-use decisions spill over municipal boundaries.”161 Regional planning, unlike other service delivery functions, was therefore a focal point for provincial-regional disputes that tested the limits of an informal government’s powers against the constitutional limits set by longstanding case law including the British Columbia Municipal Act. In spite of this setback, land use and transportation planning continued in an unofficial capacity within the GVRD because local municipalities remained invested in seeing that the goals of the Livable Region Programme were achieved. Under the auspices of the Department of Development Services, regional planners continued to advise and provide data to municipalities in the region, thereby achieving a degree of planning coordination through uniform data and development advice.162 After approximately five years of this arrangement, the planning function became increasingly institutionalized within the GVRD, eventually evolving into “General Services” paid for out of the regional levy.163 Ken Cameron, a GVRD planner during this time who became manager of the GVRD policy and planning department in the 1990s, explains how planning continued on an informal basis following 1983:

There’s two reasons why [regional planning] survived in my opinion: one is that there was a knowledge base there that municipalities value; and the second thing was that there was the first [1975] Livable Region Plan which had been developed with a lot of participation and had a lot of buy-in from municipalities but it had never been adopted as an official plan so it could not be cancelled by legislation. So it lived on in the hearts and minds of local governments partly because…it had a paralegal existence.164

Lacking the legislative authority to plan, municipalities nevertheless continued to support regional planning goals because they were invested in achieving the outcomes set by the 1975 plan. By 1990, this support translated into the launching of Creating Our Future, a GVRD program run by the Department of Development Services with the overt aim to revisit the 1975 Livable Region Programme. By 1993, the Department had changed its name to Strategic Planning and regional planning was once again in the public spotlight despite its unofficial legislative status, leading several provincial ministries who were then working on a transportation plan for the region to begin collaborating with GVRD planners.165

161 McAllister, Mary Louise. governing ourselves? The Politics of Canadian Communities. (UBC Press: Vancouver, 2004), 119. 162 Interview with Ken Cameron, 12 March 2012. 163 Interview with Cameron. 164 Interview with Ken Cameron. 165 Artibise, Cameron and Seelig, “Metropolitan Organization,” 203. 66 This pattern of ‘do it yourself planning’ exemplified a long history of informal municipal governance premised on the belief that, as one commentator has articulated,

the absence of a theoretically appropriate regional government is no excuse for inaction. Communities can forge the regional institutions they need by doing it themselves. In that respect, GVRD is a notable example of the ability of local government to find innovative ways to meet the needs of their citizens.166

Through demonstrating the value of planning knowledge, creating planning goals through an inclusive process that brought region-wide support for its vision and the perseverance of local planners despite their informal status, planning was able to continue throughout the region on a voluntary basis until finally being reinstated by the province in 1995 as a regional function.

The Provincial Control of Local Transit Similar to the dynamic history of planning authority in the Lower Mainland, transportation is another major exception to the Provincial government’s history of the “gentle imposition” on local government. Since 1962 when the Province purchased the privately run BC Electric Railway Company, a streetcar operator and electricity provider with service monopolies in cities throughout the Lower Mainland, transit has been largely a responsibility of the provincial government.167 Upon being purchased, the transit service aspect of the company was reformed as a division of the BC Hydro and Power Authority, a Crown corporation whose primary focus was to increase the province’s hydro-electric infrastructure and sell electricity and gas.168 Through this arrangement, excess electricity from the grid and a portion of BC Hydro’s power and gas revenues were used to help subsidize public transit in the region.169 In addition, certain local governments also provided their own separate public transit services through municipally-owned systems such as the municipality of West Vancouver’s Blue Bus Transit system.170 This early history of mostly provincially provided transit service and a mix of revenue sources became important for the later development of transit in the region.

166 Artibise, Cameron and Seelig, “Metropolitan Organization,” 210. 167 John F. Meligrana. “Toward regional transportation governance: A case study of Greater Vancouver,” Transportation 26 (1999), 368. 168 Meligrana. “Toward regional transportation governance,” 369. 169 TransLink, “The Road Less Travelled,” TransLink Website, accessed 23 February 2012. Burnaby: TransLink, 2008, 11. 170 West Vancouver’s Blue Bus system was founded in 1912 and is the oldest continuously operated municipal system in North America. See West Vancouver Bus Company, “Blue Bus History,” accessed on 23 February 2012. http://westvancouver.ca/Level3.aspx?id=38090 67 For a time after 1962, transit operations were passed from one provincial government organization to the next and were characterized by a lack of leadership and political accountability. For fourteen years, most public transit in the Lower Mainland was provided by a division of BC Hydro, which used fares, provincial grants, gas and electricity revenues as well as excess electricity from BC Hydro’s grid to operate a fleet of electric trolleys — which had replaced all streetcars in the 1950s — and pay for bus operations. Throughout this period, BC Hydro had been coming under increasing criticism for the inadequate public transit service being provided.171 In 1974, a common fare structure agreement between BC Hydro and the West Vancouver Blue Bus Company was reached and public ferry service was launched between the downtown and North Vancouver. These changes raised the prospect of the further unification of transportation services under one regional multi-modal regional authority.172 Instead, Provincial transit services were transferred to a new Bureau of Transit Services within the Ministry of Municipal Affairs in 1976, only to be moved again in 1978 to a new Crown corporation established under the Urban Transit Authority Act.173 The act created a provincially owned operating corporation that later became known as BC Transit and gave the GVRD greater control over fares and service levels through appointing local elected officials to the Authority’s Board of Directors. In exchange for these new powers, the GVRD was required to fund a portion of BC Transit’s operations through either property taxes, a surcharge on electricity, a gas tax or a combination of the three.174 Local influence over transit was expanded in 1982 with the creation of the GVRD Transit Department, however power of transit was reconsolidated by the province following the 1983 dissolution of GVRD planning authority. During this period, local activism in the Vancouver region for improved transit combined with the decision to host the 1986 World Exposition eventually led to provincial investment in rapid transit. In the 1970s, civic organizing against freeway construction into the urban core had successfully prohibited any highways from being built within the City of Vancouver, and had limited highways within the GVRD to only 170 kilometers — half of the average in a similarly sized American city.175 While similar to Toronto’s anti-expressway movement, it did not result in a provincial transit policy, despite local demands that transit be used to combat increasing

171 Meligrana. “Toward regional transportation governance,” 369 172 TransLink, “The Road Less Travelled,” 11; Meligrana. “Toward regional transportation governance,” 371. 173 Emily Yearwood-Lee. “Transit in BC: Governance and Major Developments Timeline,” Legislative Library of British Columbia, Background Brief 2007:05 (October, 2007), 5. 174 Meligrana. “Toward regional transportation governance,” 369. 175 Cervero, The Transit Metropolis, 426. 68 congestion in the city.176 It was not until Vancouver hosted Expo ’86 under the theme “Transportation and Communication” that the provincial government agreed to fund a rapid transit line in the region that was to double as a showcase project for the World’s Fare. Initially, Livable Region plans had called for a system to be built within the downtown core,177 however the provincial government instead went with a more innovative and expensive $854 million Advanced Light Rapid Transit (ALRT) system (see Exhibit 23). ALRT was an elevated and driverless Intermediate Capacity Transit System under development by

Exhibit 23: Skytrain Technology in Vancouver

Source: MStar, Wikimedia Commons, Accessed 23 February 2012. Ontario government owned Urban Transportation Development Corporation (UTDC) that was similar in technology to the Scarborough Rapid Transit line completed in 1985 in suburban Metro Toronto. The B.C. government was the first to purchase the new technology developed by UTDC outside of Toronto,178 kick starting the Ontario government’s industrial development agenda.179

176 John Clark, “Rapid transit still a pipedream,” Globe and Mail, 19 November 1977, (LexisNexis Academic). 177 Interview with Clive Rock, 12 March 2012. 178 A pilot line was being constructed as an eastern terminus of the in Scarborough, which would open in 1985 and served as a model for further UTDC sales to Detroit and San Jose. 69 As a result, Ontario Premier David Paterson and Ontario Minister of Transportation and Communications Edward Fulton along with British Columbia Premier William R. Bennett attended the “Expo” Skytrain opening ceremonies on December 11, 1985.180 The provincial operation of public transit and subsequent decision to use what became known as Skytrain technology rather than the less costly light rail technology recommended by local plans was to be crucial in establishing a framework for decision-making around transit that was at odd’s with the provincial government’s otherwise “gentle imposition” approach to local government interests. As with capital decision-making in Toronto, the route alignment and method of funding ultimately used for the Skytrain were hotly contested. The alignment ultimately chosen favored provincial preferences — a choice which had been vocally fought by the then Vancouver Mayor Mike Harcourt, who was ultimately excluded from the line’s 1982 groundbreaking ceremony hosted by the B.C. Premier.181 Furthermore, no commitments regarding how the $854 million project would be paid for were made until around the time the line began operations. It was then announced by the Province that they would provide only a portion of the capital costs with almost half of the funds provided through a 15 per cent fare increase and additional funds also coming from increases in regional taxes.182 Once in operation, the Expo Skytrain did little to stop continuing declines in regional public transit patronage, which decreased to 66 trips per capita in 1996 from 90 trips prior to the line’s opening in 1986.183 Fare increases in 1991 and 1993 contributed to this decline of transit in the region, the second of which was in response to local funding shortfalls of $51 million needed to pay for the continuing costs of Skytrain construction.184 As the planning for a second rapid transit line began in the early 1990s, local officials, buoyed by the growing momentum for regional land use planning through the Creating Our Future process, decided that the time was right for the GVRD to play a greater role in regional transportation planning. Thus, with control over large capital projects acting as a

179 In an interview conducted by the author, it was suggested that the agreement to purchase Ontario technology by the British Columbia government may have been influenced by constitutional discussions that were taking place between the provincial and federal governments at the time. See Interview with Ken Cameron. 180 Clark, “Rapid transit still a pipedream.” 181 Mike Harcourt and Ken Cameron, City Making in Paradise: nine decisions that saved Vancouver, (Vancouver: Douglas & Mcintyre, 2007), 95. 182 Sewell, “Transit popularity is riding high,” Globe and Mail. 17 April 1986, (LexisNexis Academic). 183 Sewell, “Transit popularity is riding high.” 184 Jeff Lee. “Transit fares to take a hike: Commission also raises cost of passes, faresavers,” Vancouver Sun, 7 January 1993. (LexisNexis Academic). 70 catalyst, local officials soon mobilized to claim greater control over transportation in the Greater Vancouver Region.

A Return to Planning: The Creation of a Regional Transportation Authority The return of GVRD planning authority in the mid-1990s spurred regional interest in take over responsibility for transportation, which they understood was fundamentally tied to achieving their land use and development goals. Jumpstarting the integration of transportation and land use was the failed 1993 attempt by the Province and former GVRD Chairman Michael Connor to gain support from the GVRD Board for a regional transportation plan that was found politically unacceptable due of the number of new roads it proposed.185 Following its failure, BC Transit staff began working on a new transportation plan in collaboration with GVRD planners in the Strategic Planning department who were then working on the Creating Our Future process. As Ken Cameron, who headed the Strategic Planning department at the time, explains, the collaboration that resulted from having BC Transit staff work alongside GVRD planners who were actively working on the regional growth plan led to the creation of complementary transportation and land use planning documents:

The growth management plan and the transportation plan were evolved together, really, almost in the same office, effectively…So that’s why your first transportation policy [in Transport 2021] is to manage growth, and your first growth management policy [in Livable Region Strategic Plan] is to implement your transportation plan.186

Thus, in 1994, two documents were produced: first, Transport 2021 was jointly announced by the Province and the GVRD; second, a new Livable Region Strategic Plan was presented to the GVRD, within which Transport 2021 goals were embedded.187 In 1995, the province reversed its 1983 decision to revoke the GVRD’s planning powers and in the following year officially approved the Livable Region Strategic Plan through the Growth Strategies Statutes Amendment Act. With the province needing regional support for a transportation plan following their initial failure to gain popular support for a first transportation plan and the GVRD requiring increased transportation planning authority to implement the outcomes of their land use planning process, collaboration between staff from both governments initiated a new relationship that was mutually

185 Interview with Ken Cameron. 186 Interview with Ken Cameron. 187 Artibis, Cameron and Seelig, “Metropolitan Organization,” 204. 71 beneficial, opening the door to a new governance model for transportation decision-making and operations. These decisions in the mid-1990s marked a high water point for harmonious municipal-provincial relations regarding public transit and set the stage for new institutional reforms that passed responsibility for public transportation from the province to the GVRD. Following the approval of the Livable Region Strategic Plan, a series of transportation governance workshops were initiated to define who and how the ambitious goals contained within the plan and articulated in Transport 2021 would be implemented. These workshops found that local governments, through the regional board, “wanted to buy a place at the table” using existing tax sources and play a larger role in regional transportation.188 These discussions took on renewed importance in 1997, when without warning the provincial government announced it was studying a proposal to reclassify many provincial highways as local roads and download the cost for maintenance to local municipalities within the GVRD. At first, the province claimed that the annual burden this would place on municipalities would only amount to $8 million. Municipalities countered that this ignored maintenance costs for 91 bridges, 151 signal-controlled intersections, line-painting and more that would ultimately cost in the hundreds of millions of dollars.189 Such a move sowed distrust among local politicians who no longer had faith that provincial commitments to implement the goals of Transport 2021 would be carried through.190 Reflecting this sentiment, George Puil was appointed GVRD chair on December 6, 1996, whose first words upon taking office were, “I want to do something about transportation in this region.”191 The alignment of new fiscal burdens on local government, growing distrust towards the province and the arrival of a political champion interested in transportation reforms coalesced to launch regional-provincial negotiations regarding establishing a new regional transportation governance structure in the GVRD. The opportunity to renegotiate transportation governance in the region evolved out of discussions over the role of GVRD officials in the planning and design of a new rapid transit route for the region. As with the Expo Skytrain, differences arose between the GVRD and the province over phasing, technology, route alignment and funding, which GVRD planners argued they should have a role in deciding if local funds were to be used to pay for the project.

188 TransLink, “The Road Less Travelled,” 13. 189 Herald Munro. “BC dumps highway costs on cities,” The Vancouver Sun, 2 December 1996, (LexisNexis Academic). 190 Simpson, Scott. “Downloading of road expenses reviewed: Local governments say their taxpayers can’t afford the plan and Port Moody now refuses to maintain Ioco Road,” Vancouver Sun, 17 January 1997, (LexisNexis Academic). 191 Harcourt and Cameron, City Making in Paradise, 149. 72 Consequently, the discussions over the new line were split into two negotiations; the first focused on the construction of the line itself — the route, technology and phasing — and the second centered around the governance and funding arrangements for transportation in the region.192 The negotiations proved to be only partially successful. The construction talks were immediately upset when, following an agreement that GVRD municipalities appoint a project manager from a list provided by the province, only one name was provided, effectively ending the talks.193 Nevertheless, negotiations between the GVRD and the province on a new governance structure for regional transportation continued. From the GVRD’s perspective, the goal of the governance and funding negotiations was to have transportation decision-making responsibility devolved to the region through funding and operational mechanisms that would wean the system from its reliance on provincial grants and provide it with the flexibility to manage all modes of travel and serve all communities in the region. As Marvin Shaffer, the negotiator for the GVRD, recounts:

We started out by establishing a set of principles before we actually negotiated the legislation that would establish TransLink. And those principles were around what it was we were going to achieve. We talked about integrating transportation planning — so we were looking across modes — with land use planning, so we looked at funding principles, that they had to be adequate and appropriate, meaning that the funding should be coming from transportation related uses to some degree.194

These three principles — an intermodal authority that integrates transportation and land use through appropriate and adequate funding — became the basis for the Greater Vancouver Transportation Authority, later rebranded as TransLink. Crucially, TransLink was to take on all the functions formerly held by BC Transit within the GVRD along with the role of allocating funding to municipalities for road maintenance and improvement — a new responsibility that meant more auto-dependent suburbs in the GVRD also had a stake in the authority’s success.195 In addition, air quality testing, bicycle planning, taxi regulation and ferry operations were also included under TransLink’s responsibility. To oversee these disparate functions, TransLink would have a purchaser-provider model (see Exhibit 24), where different transit subsidiaries

192 Harcourt and Cameron, City Making in Paradise, 152. 193 Harcourt and Cameron, City Making in Paradise, 152. 194 Interview with Marvin Shaffer, 16 February 2012. 195 Translink, “The Road Less Travelled,” 17. 73 Exhibit 24: TransLink Organizational Chart, 2001

Source: TransLink, 2001 TransLink Annual Report, 11. would deliver the services under operating contracts set and coordinated by TransLink. This was meant to introduce an element of competition into the delivery of service through performance incentives while also giving TransLink the flexibility to tailor services to different communities and retain locally run systems such as the West Vancouver Blue Bus Company.196 TransLink itself was envisioned as having a small staff dedicated to policy and planning rather than operations, and a monopoly on planning, transit coordination and fare policies rather than service delivery in the region, as is the case with the TTC. This mix of transit and roads along with a purchaser-provider model made the GVTA proposal unique in North America and in much of the world, provoking interest in places such as London, who were later to adopt a similar model for their transit system, Transport for London.197

196 Interview with Clive Rock. 197 Cameron and Harcourt, City Making in Paradise, 152. 74 Regarding what revenue mechanisms and political oversight would exist for the new authority, negotiations between the GVRD and the province were more contentious. The final arrangement established TransLink as a separate authority rather than as a department of the GVRD with a 15 member board of directors, 12 of whom were appointed councilors from the GVRD along with three Provincially appointed members of the Provincial Legislative Assembly (see Exhibit 25) — a structure strongly advocated for by the province.198 On the funding side, GVRD negotiator Marvin Shaffer recounts that the aim of the region was “to try to get a link between the entity that wants to increase service and the political responsibility of taking the heat for the taxes that went with that.”199 As a result, TransLink was given a fairly broad range of revenue sources from which it would be funded. These included all those formerly held by BC Transit; fares, a hydro levy, gas taxes, an off-street parking tax and property taxes. However, in an attempt to limit the authority’s reliance on a property tax,200 which was the primary revenue source for all municipal government responsibilities, TransLink was also giving the authority to implement tolls, a new parking sales tax, raise all currently existing taxes by a set amount and, most importantly, institute a new vehicle levy tied to mileage that was envisioned as the Authority’s new primary revenue source.201 As Shaffer recounts:

In all our modeling and all of our analysis, what we assumed would happen was that TransLink, which clearly had the power to do this, would implement a vehicle levy. And whether it was distance based on not, a vehicle levy would become the major new source of revenue that would fund the increase in service that was agreed was needed. And certainly in the legislation as we understood it and in the agreements as we understood it, that was something that the transportation authority could do on its own without provincial approval because they had the power under the [Greater Vancouver Transportation Authority] Act to do that.202

Together, these new revenue sources would make TransLink independent of either provincial or municipal grants and allow it to carry out the plans agreed upon in the Livable Region Strategic Plan. Furthermore, they reflected a historic acceptance of using several different revenue sources to pay for transit that was rooted in transit’s initial operating history as a division of a private electricity company. After consulting with each municipality within the GVRD, the proposal for a new authority went to the GVRD board for approval on July 30, 1998, where it was supported

198 Interview with Ken Cameron. 199 Interview with Shaffer. 200 Interview with George Puil, 2 March 2012. 201 Interview with Puil. 202 Interview with Shaffer. 75 Exhibit 25: TransLink Governance Model, 2001

Source: Translink, 2001 TransLink Annual Report, 2 by 70 per cent of the members. That same day, the provincial government enacted Bill 36, The Greater Vancouver Transportation Authority Act. TransLink officially launched the following year, marking the culmination of a ten year regional vision process that had begun with Creating Our Future and had generated local support for taking both the planning and funding responsibilities for transportation in the GVRD.

Ridership Growth and the loss of the Vehicle Levy: 1999 to the present The formation of a new regional transit authority for the GVRD set off a decade of growth in transit patronage that continues today (see Exhibit 26). In 1998, one year preceding TransLink’s launch, 123 million linked passenger trips were made in the region on transit, with the average resident making 65 trips per year (see Exhibit 27). After steady year-over-year increases, by 2010 annual passenger trips totaled 211 million, an increase of 72 per cent, while regional population

76 had only grown 20 per cent. Between 1997 and 2008 the bus fleet nearly doubled in size to 1432 from 752. Service hours, a metric TransLink uses to measure total operating service, increased by almost 50 per cent to 6.4 million hours in 2010 from 4.3 million hours in 2000. These

Exhibit 26: Public Transit Ridership in GVRD, Linked Trips, 1989-2010

Source: Data provided by Metro Vancouver, accessed 23 February 2012 increases parallel those seen by the TTC during the 1970s and 1980s, where predictable funding streams allowed for significant ridership gains even when compared to regional population. These successes did not come immediately. In fact, problems immediately arose following TransLink’s launch that challenged the original intentions of the negotiators that the

77 Exhibit 27: TransLink Operating Statistics, 2000-2010 2000 2010 Change Passengers (millions) 129.1 211.3 63.7% Unlinked Trips (millions) 229.7 347.2 51.2% Vancouver CMA Population 1,955,905 2,273,979 16.3% Metro Ridership per Capita 66.0 92.9 40.8%

Service Hours (millions) 6.382 4.327 47.5% Source: TransLink Annual Reports, 2001-2010.

Authority remain financially independent and operationally flexible. In 2000, the three board seats appointed by the province on the 15-member TransLink board went unfilled,203 with provincial legislative assembly members citing a conflict of interest that prevented them from sitting.204 This decision anticipated future disputes over the implementation of the controversial vehicle levy, which GVRD chair Puil was moving to do. As Puil explains, the GVRD was prepared to approve the controversial vehicle levy, which he and others had built support for during the preceding year at considerable political cost.205 Public surveys from the time confirm this account, with one finding 51 per cent of people supporting the proposed TransLink improvements but opposing the $75 annual levy, unless it was the only way, in which support climbed to 65%.206 On December 1, 2000, Puil’s proposal for a vehicle levy on all cars ranging from $40 to $120 dollars was approved by the GVRD with a narrow vote of 56 to 50, which was estimated to bring in $95 million in 2002.207 All that was left was the need for the provincial government to instruct the provincially owned Insurance Company of British Columbia (ICBC) to enforce the levy by not renewing annual insurance plans for those who had not paid the levy. While controversial and highly contested, the public polling and political championing of new revenue sources demonstrated the degree to which public engagement with planning issues had contributed to a widespread regional demand for improved transportation funding.

203 TransLink, 2001 TransLink Annual Report, 2. 204 Interview with Shaffer. 205 Interview with Puil 206 Kines, Lindsay. “Survey finds support for transit improvements: Nearly 90 per cent of respondents agree with plan to pump $1.4 billion into services and roads,” The Vancouver Sun, 13 March 2000, (LexisNexis Academic). 207 Bohn, Glenn. “It’s official: Transit levy will be $40 to $120: GVRD passes new tax but still must work out details of how to collect the money,” The Vancouver Sun, 2 Dec 2000, (LexisNexis Academic). 78 Despite this show of local support, the levy proved too controversial for the provincial government who were unwilling to enforce the new levy despite clearly articulating in the TransLink agreement that such a revenue was within the power of the region to institute. During the month of January, 2001, the B.C. government made it clear they would not instruct the ICBC to enforce a vehicle levy, a decision the outgoing Chief Executive Officer of TransLink claimed was in violation of the agreement signed by the Province and the GVRD creating the new transportation authority.208 The cancellation of the vehicle levy was both unexpected and devastating to the new authority. As Shafer, the principle negotiator for the GVRD in setting up TransLink, remarks: One of the principles of the agreement was the municipalities, through the transportation authority, would have all kinds of power to do all kinds of things, but they had to take the political responsibility for the taxes that were needed to fund these things…Because we have [ICBC], it would have been very easy for [the Province] to facilitate the collection and certainly the enforcement of the vehicle levy and they refused to do it. I can understand the collection part, because it would have almost been like the province is collecting money that the municipal politicians are implementing. No government likes to collect a tax that another government or another level of government is imposing. But they went even further where they wouldn’t even use their ability to help with the enforcement, making it an impractical tax. If you can’t enforce something there’s no point in imposing it.209

The vehicle levy, which TransLink was legally capable of charging directly to vehicle owners, proved unenforceable without the cooperation of the provincial government through the ICBC. It has been suggested that the province’s turnaround on the levy charge was related to their concern over their extremely low polling numbers at the time and the upcoming provincial election, which they were to lose.210 Nevertheless, the loss of a vehicle levy forced TransLink to reduce bus services, delay capital improvements, and have the provincial auditor general review its governance arrangement all in its first full year of operations.211 Furthermore, the three board seats reserved for provincial representatives remained empty and served to distance the Provincial government from the authority just as its major source of long term funding collapsed. Labor strife the following year also demonstrated how, along with the need for increased funding, the first few years of TransLink operations were anything but easy, leading TransLink to backpedal on its initial goal to decouple transit funding and local property taxes while

208 Skelton, Chad. “TransLink Levy as good as dead, officials say: Farnsworth says B.C. won’t enforce unpopular tax,” The Vancouver Sun, 22 January 2001, (LexisNexis Academic). 209 Interview with Shaffer 210 Interview with Cameron; McCashin, Cathy. “NDP was spineless on transit levy,” The Vancouver Sun, 26 January 2001 (LexisNexis Academic). 211 TransLink, “The Road Less Travelled,” 23. 79 experiencing steep ridership declines. In April, bus workers for TransLink’s largest subsidiary Coast Mountain Bus Company (CMBC) — the region’s largest bus operator that had formerly been BC Transit but was now wholly owned by TransLink — embarked on a 123 day transit strike, the second longest in Canadian history.212 The dispute centered around proposed hiring and work rules, with CMBC wanting additional flexibility to hire part-time employees to increase efficiency, and a three year wage increase, with the union advocating for 18 per cent compared to CMBC’s offer of 8 per cent.213 Ultimately, bus workers were legislated back to work with an 8.5 per cent increase.214 These labor negotiations echoed those seen in Toronto during the early 1970s, where new funding arrangements precipitated higher wage demands and contentious work stoppages. The initial aim of local politicians and negotiators to wean transit’s dependence off the property tax was slowly repealed during this period due to the lack of the vehicle levy and new provincial policies. In November, 2001, the Province proposed to raise the regional gas tax dedicated to TransLink by two cents per liter to twelve cents if the GVRD matched the funds with new revenues from local sources. In order to find matching revenues, the TransLink board approved increasing fares and property taxes following a 66% public approval rating of the methods, a move TransLink head Puil said he was loath to do.215 The return to using property taxes — the major source of all GVRD services funding — to fund transit was ironic in that it had explicitly been identified as a funding method to move away from during TransLink’s negotiations and public consultations. In fact, TransLink’s reliance on property tax only increased in the following years (see Exhibit 28). The provincial requirement for matching revenues also directly contradicted the recommendations from the Auditor General’s governance review report released months earlier that had suggested the province play a less prominent role in regional transportation.216 Thus, despite the initial intent of the Greater Vancouver Transportation Authority Act to expand local authority and establish funding that was stable, predictable and appropriate, the Authority found itself continuing to be shaped by provincial policies and reliant on revenues generated from property taxes and fares.

212 TransLink, “The Road Less Travelled,” 39. 213 TransLink, “The Road Less Travelled,” 37. 214 TransLink, “The Road Less Travelled,” 39. 215 TransLink, “The Road Less Travelled,” 49. 216 TransLink, “The Road Less Travelled,” 47. 80 Exhibit 28: TransLink Revenue Sources as a Share of Total Revenues, 2000-2010

Revenues 2000 2010 Real Growth Total Revenue (millions of $) 498.7 1127.7 126.1%

% from Fares and Transit Advertisements 41.7% 38.8% 110.3% % from Fuel Tax 32.5% 28.7% 99.3%

% Other Taxes and Levies (including Property Taxes) 25.7% 32.5% 185.7% Source: TransLink Annual Reports, 2001-2010

These setbacks were not enough to obstruct new bus service policies, which can be credited with bringing significant increases in ridership during this period paralleling those seen in Toronto during the 1970s and 1980s. New discounted fare programs and services aided TransLink to make a quick turnaround in 2002 that initiated a decade of continuous ridership gains and service expansion. One particularly successful program was the Vancity U-Pass, a heavily discounted unlimited monthly pass offered to students at the University of British Columbia and Simon Fraser University. The new passes along with a 27 per cent increase in bus service to the two campuses led transit use to both Universities to increase by 63 per cent between 2003 and 2005.217 This increase in student use of transit contributed to 2003 seeing the largest percentage growth in ridership since the opening of the Expo Line in 1986.218 Furthermore, an innovative community shuttle service that had been launched by TransLink to serve more remote, low density areas had increased ridership to 3,772,480 passengers in 2010 from 124,553 passengers in 2002. Meanwhile fare box recovery ratios for transit remained at approximately 50 per cent — as they had in Toronto during the late 1970s and 1980s. The new fare discounts and feeder shuttle services from lower density communities also helped TransLink see unlinked trip growth that outpaced similarly impressive increases experienced by the TTC during the 1970s (see Exhibit 29). These trends point to how a diversity of revenue sources and widespread regional support for transit are facilitating a period of unprecedented growth in public transit ridership in the region.

217 Urban Systems, “U-Pass Review Final Report,” May 5, 2005, S-2. Accessed 23 February 2012. http://trek.ubc.ca/files/2010/08/U-PassReview.pdf. 218 TransLink, 2003 TransLink Annual Report, 1. 81 Exhibit 29: Comparison of Toronto and Vancouver Transit Ridership Growth Toronto CMA, 1970- GVRD, 2000-2010 1980 Change in unlinked trips 37.50% 50.90% Change in Metro Population 19.20% 16.30% Change in trips per capita 15.10% 30.00% Change in unlinked trips per revenue 3.80% -7.60% passenger

note: Toronto trips reflect TTC trips, not public transit trips in the region as a whole Source: Adapted from Mees, Transport for Suburbia, 92 and TransLink Annual Reports

Capital Project Problems and Governance Reforms The most visible impact of the vehicle levy’s failure, however, was the loss of independence and decision-making power to the province in the planning and design of new capital projects. This situation was highlighted by the process leading up to the building of the Canada Line that ultimately resulted in a governance review imposed by the province in 2007 and served to significantly reduce regional control over capital project decision-making. While all modes of transit had expanded during the decade, growth on the Skytrain system and five-train Commuter rail system far outpaced bus and ferry increases. This was facilitated by rerouted bus lines that now connected riders to Skytrain stations and also suggests that many new transit users may be using only the Skytrain without any transferring — one possible explanation for why the average number of unlinked trips per revenue passenger has declined slightly (see Exhibit 30). This new reliance on Skytrain expansion to drive passenger increases meant that decision-making power over route alignments and technology were equally if not more important than they had been prior to 2000. Yet rather than the new governance arrangement increasing the GVRD’s control over capital projects, if anything, it declined. A case in point is the construction of the Canada Line, Vancouver’s newest addition to the Skytrain system that was, similar to the Expo Line, meant to be a showcase project for the 2010 Olympic Winter Games hosted by the city. The project was unique for several reasons. First, the Canada Line was a public-private partnership, a new project delivery model for transit in British Columbia. Next, it received substantial funding from the federal government and the federally- run airport to which it connected, a circumstance that is relatively rare in Canadian public transit, where the federal government has historically not contributed to local transit projects. Finally, the route chosen for the Canada line was actively opposed by the GVRD and TransLink board, who twice voted against funding the project because it was not the highest priority investment for the

82 region.219 From Shaffer’s perspective, “the TransLink board didn’t think it was the right line, didn’t think it was justifiable, and wasn’t approving it.”220 Nevertheless, the project was ultimately approved by the TransLink Board in what Siemiatycki describes as a “hastily called” third vote that was justified due to perceived opportunities to use federal grants and private sector collaboration to reduce costs:221 Despite the fact that top priorities from the regional plans focused more specifically on improvements to the bus network than infrastructure megaprojects, a chart comparing the potential sources of funding for major transportation capital projects devised by Vancouver’s regional transportation authority, TransLink, indicates the appeal of the [Canada Line] over other alternatives. Among transit alternatives, the [Canada Line] was identified as being most conducive to meeting the interests of local and senior levels of government in Canada, it had added appeal for special capital grants as it would be highly visible for the Olympic games that Vancouver will hose in 2010, and it had the greatest potential to attract private-sector financing that desired a measure of cost recovery.222

Rather than provide capital money for improving the bus network where unlinked trips had lagged, growing only at one third the speed of the Skytrain (see Exhibit 30), TransLink instead became responsible for providing $400 million towards the estimated $1.7 billion Canada Line that commentators have argued had more to do with catering to federal and private funding opportunities rather than meeting regional priorities.223 Lacking its own revenues, TransLink found itself dependent on satisfying senior government partners to fund transit system rather than follow regional priorities.

Exhibit 30: Growth in TransLink Passenger Boardings by Mode, 1997-2009 Bus Seabus Skytrain Total 1997-2007 22.23% 5.89% 63.23% 29.91% Source: TransLink Planning Staff

The fight over the Canada Line led the provincial government in initiate a governance review of TransLink in 2007, which led to the restructuring of TransLink’s Board that ultimately reduced the GVRD’s decision-making power over transit. In November, 2007 the Province of

219 Rod Mickleburgh. “Airport link voted down,” The Globe and Mail 19 June 2004, (LexisNexis Academic). 220 Interview with Marvin Shaffer. 221 Matti Siemiatycki, “Implications of Private-Public Partnerships on the Development of Urban Public Transit Infrastructure: The Case of Vancouver, Canada,” Journal of Planning education and Research 2006, 147. 222 Siemiatycki, “Implications of Private-Public Partnerships,” 141. 223 Rod Mickleburgh. “Controversial B.C. transit line gains approval; critics fear $1.7-billion Vancouver project will siphon money from existing services,” Globe and Mail 2 December 2004, (LexisNexis Academic). 83 British Columbia passed Bill 43, The Greater Vancouver Transportation Authority Amendment Act, 2007, changing the official name of the authority to the South Coast British Columbia Transportation Authority and overhauling its governance structure. The governance review was widely perceived as a vindictive move by the Province that punished the GVRD for the difficulties it caused during the Canada Line approval process.224 As a result of the changes, GVRD influence over the TransLink board was reduced through the removal of elected politicians from the TransLink Board. Instead, a new nine-member board of non-elected citizens would guide TransLink, each of whom would be selected through a complex vetting process where a screening panel would select a minimum of fifteen candidate based on certain criteria, who were then presented to a GVRD Mayors’ Council to be selected to the TransLink board (see Exhibit 31). The Province, the Mayors’ Council, the Institute of Chartered Accountants of British Columbia, the Vancouver Board of Trade and the Greater Vancouver Gateway Society would each appoint one screening panel member. The new TransLink Board of Directors would remain the body legally responsible for managing TransLink and new appointments would occur on a rolling basis. Finally, the Mayors’ Council became responsible for appointing a Regional Transportation Commissioner to advise TransLink and the Mayors’ Council on the “reasonableness of the financial assumptions in TransLink’s 10-year strategic plans and the consistency of the plans with the provincial vision.”225 The Commissioner was also required to approve all fare increases that exceed inflation. Through this complex new governance arrangement, the GVRD’s voice in TransLink’s strategic planning and policies was significantly reduced while provincial power over transit was increased. In addition to governance, TransLink continued under the purchaser-provider model to be responsible for all transit in the region along with upgrades and maintenance of the major road network, air quality testing, construction of new road facilities, special transit services for people with disabilities and ferries. In addition, municipalities currently not included under the original arrangement were now given the option to opt into the TransLink service region if they wished.226 These acts provided increased flexibility to the region to ensure TransLink remained the coordinating body for all travel in the region – an ability lacking in Toronto that was a

224 Kelly Sinoski, Kelly. “Mayors seek change in TransLink governance,” Vancouver Sun, 2 March 2012, (LexisNexis Academic). 225 TransLink “TransLink Governance Review Panel,” Government of British Columbia, 26 January 2007, Accessed 23 February 2012, 24. http://www.th.gov.bc.ca/publications/reports_and_studies/TRANSLINK_Governance_Review/070126_T RANSLINK_Governance_Review.pdf 226 TransLink, 2007 TransLink Annual Report, 8. 84 significant factor in the decline of transit use in the 1990s and 2000s. The act also ended a contentions parking stall tax and replaced it with a matching $18 million in new regional property tax revenues, thereby increasing TransLink’s dependence on a revenue source that was highly unpopular at the municipal level. No new revenue sources were provided. Seen together, these changes followed in a consistent pattern of provincial “gentle imposition” in the formation of regional boundaries but imposition in matters of transportation governance and revenues.

Exhibit 31: TransLink Governance Structure, 2008

Source: TransLink, 2008 TransLink Annual Report, 9 Following the governance reforms, TransLink’s reliance on senior government funding for planned capital expansion has continued. This finding is further supported by the recent experience of planning a new rapid transit route in the Northeast Sector of the GVRD. Originally

85 intended as a surface light rapid transit line,227 in 2008 a Provincial Business Case document instead selected the more expensive Skytrain technology which it would provide two-thirds of the funding for through a federal grant.228 Of the $1.4 billion project, TransLink is required to contribute $400 million, which it did in September 2011 by increasing regional gas taxes from $0.12 to $0.15 per liter — the maximum increase allowed under the 2007 governance reforms — as well as by raising property taxes. Reflecting on the experience of the Evergreen line, the current Senior Manager for Infrastructure Planning at TransLink comments: Part of the challenge that exists at TransLink is although TransLink was created to give local governments more of a say in their transportation outcomes, it wasn’t really equipped with all the revenue tools to help deliver on that. So, every time we need new revenues, we have to go to the provincial government and ask for those revenue sources to be enabled. It kind of calls into question in some people’s minds whether or not the local government can truly have a significant say if they always need to rely on the provincial government to enable these revenue sources.229

With TransLink lacking sufficient revenues to independently fund capital expansion projects or the GVRD lacking the ability to increase certain revenue sources without provincial approval, the initial aims for a greater Vancouver transportation authority remain unfulfilled. Nevertheless, prospects for TransLink’s future remain bright, with ridership continuing to grow, increased calls by GVRD politicians for new transit revenues and for further reforms to TransLink’s governance that would improve local control over decisions. Following the 2009 completion of the Golden Ears Bridge, TransLink has added toll revenues to its portfolio of revenue sources which, along with an increase in the parking sales tax to 21 per cent from seven per cent, saw total taxation revenues increase in 2010 by $114m over the previous year.230 Recently, GVRD politicians have been calling for new reforms to TransLink governance that would return more local control over transit decision-making.231 In addition, support is once more growing for a vehicle levy. On March 15, 2012 the Mayors’ Council wrote to the provincial minister of transportation and infrastructure requesting he implement a vehicle levy or carbon tax

227 TransLink, “TransLink Project Definition Phase Work (2006), TransLink Website, accessed 23 February 2012. http://www.translink.ca/~/media/Documents/about_translink/governance_and_board/Archive/meet_agend a_min/2006/10_18_06/4_4Case.ashx 228 TransLink, “TransLink Business Case Document” Government of British Columbia, accessed February 23, 2012. (February, 2008), http://www.evergreenline.gov.bc.ca/documents/Business_Case/080219_BusinessCase.pdf 229 Interview by the author with Jeffrey Busby on 28 March 2012. 230 TransLink, 2010 TransLink Annual Report, 26, 28-9. 231 Sinoski, Kelly. “Mayors seek change in TransLink governance.” 86 to fund bus improvements, both of which would require provincial enforcement.232 Together, these recent actions demonstrate that despite provincial limitations, regional support for public transit remains high and activism for heightened influence over the GVRD’s transportation outcomes remains a priority for local politicians.

232 Mayors’ Council on Regional Transportation, “Letter to Blair Lekstrom, British Columbia Minister of Transportation and Infrastructure,” 15 March 2012. 87 Chapter 4: Findings and Recommendations

Findings The findings of this paper highlight both the fragility of transportation institutional structures and the importance of their relationship to regional government bodies. While the benefits of regional coordination appear to be well-understood in the cases of Toronto and Vancouver — inter- municipal service coordination being chief among these benefits — the ability for either region to establish transit systems with adequate funding and the operating independence needed to bring about large increases in public transit use has proved fleeting. This struggle points to the fact that successful transportation institutions must have widespread political support while also having sufficient decision-making independence for them to reorient regional mode shares in favor of public transit. In other words, successful transportation institutions must have the confidence of the public through being both accountable to politics and separate from it. This was the case to a large extent during the late 1970s and 1980s in Toronto and since the late 1990s in Vancouver, when new funding formulas and oversight arrangements were instituted that had wide support from the public and transit officials. However, both these achievements have been limited by provincial actions that have either reformed transportation governance to reduce local control over transit or have restructured transit provision in a way that has been to the detriment of regional transit mode shares. Governance over transit should therefore be seen as a litmus test for the impact of local fights for subsidiarity — where government responsibilities are devolved to the most appropriate body — that have occurred recently in Toronto and Vancouver. In both cities, recent bills have legally recognized local governments — or only Toronto’s municipal government, in the case of Ontario — as a responsible and mature level of government fit for greater authorities and independence. This has occurred in British Columbia through the Local Government Statutes Amendment Act (Bill 14), 2000 and in Ontario in the form of the Stronger City of Toronto for a Stronger Ontario Act, 2006.233 In spite of these movements, local transportation governance remains structurally under the control of provincial governments through either their reliance on provincial funding or through outright legislation. This investigation of the evolution of public transit governance in Toronto and Vancouver finds that provincial involvement in transit has generally had a negative affect on regional mode shares by limiting the revenue-raising ability of

233 For more information on the impact of this legislation, see Jake Schabas, “The Impact of Legislative Reforms to Canadian Federalism on Toronto’s Ability to Reduce Poverty,” Berkeley Planning Journal, 24:1 (2011), 14. 88 both transit authorities despite local support such measures. This has occurred through heightened provincial influence over system expansion methods, resulting in more expensive technologies being chosen that ultimately burden the operating capacity of transit operators. Furthermore, this history of choosing capital-intensive expansion projects has also produced regional path dependencies that today are likely limiting local interest in less expensive but equally effective solutions. In Vancouver this has manifested itself through the relentless focus on Skytrain technology. In Toronto, subways rather than light rail or bus rapid transit have attracted most public attention. This is in part a product of the 1980s decision to build the ultimately unsuccessful Scarborough Rapid Transit line over a conventional light rail system or bus improvements, which caused a swing in political interest back to subways as the only publicly supported means of improving transit. The inability for either region to self-fund its own public transit ambitions is therefore adversely affecting the long-term operating and capital costs of public transit in both regions. Despite these shortcomings, common institutional factors exist in both case studies that point to how the design of local governance bodies can facilitate the creation of transportation policies that favor transit use:

1. The degree of legal formality binding local governments into unified regional bodies should reflect municipal support for the successful delivery of regional services the body is responsible for.

An implicit assumption in this paper has been that regionally coordinated transportation policies for metropolitan areas benefits all municipal residents within economically integrated urbanized areas. While this assumption has received supported in transportation studies because of the operational advantages to such an arrangement,234 less has been written about the impact different regional governance arrangements have on building political support for transit. In Toronto, the Ontario government has historically established strong regional governance structures for transportation. This has meant that little inter-municipal collaboration or region-wide consultation processes has occurred that might otherwise have been necessary to build the consensus necessary for establishing a regional transportation authority. As a result, setting regional goals or revenue mechanisms for transportation has become a provincial rather than a local responsibility.

234 Mees, Transport for Suburbia. 89 In Vancouver, the situation is reversed, where the need for municipal collaboration to achieve regional goals has meant that local governments have been forced to build consensus across the region for both transportation goals and revenue-raising mechanisms. As a result, GVRD residents have a comparatively high level of both knowledge and support for continued transit improvements while also understanding the costs associated with such improvements. The benefit of this arrangement speaks to the strength of a more informal model of regional governance rather than the more formal structure that was in place in the Toronto region between 1953 and 1998. In addition, the institutional flexibility of Vancouver’s regional model of governance over Toronto’s Metro government235 better allows its boundaries to be set by local transportation interests rather than provincial priorities. Ostrom argues that clearly defined boundaries are a common design principle of long-enduring common pool resource institutions.236 However, the cases of Toronto and Vancouver point to precisely the opposite when it comes to transportation; fixed boundaries can act as an impediment to regional transportation policies if they are unable to keep up with metropolitan expansion. Furthermore, they are more reflective of a federalist system that privileges powerful senior governments rather than empowering local institutions to seek regionally based and locally appropriate solutions to common problems. Cameron uses a similar logic in articulating the strengths of the GVRD’s cooperative form of regional governance that has facilitated flexible boundaries: It reflects respect for local government as the creation of the people, rather than the creature of the province, and a view that the role of the province is to enable and empower local governments to care for their communities. In the final analysis, that is a far more powerful form of sovereignty than recognition of local government in the constitution, a goal to which municipalities in Canada have long aspired but will never achieve.237

This position runs counter to much of the literature, which generally see boundaries as either necessary for solving common pool resource problems238 or as fundamentally inhibiting the potential for locally-based institutions to govern city-regions.239 This position is most clearly articulated by Andrew Sancton, who is here quoted at length in the conclusion of his book, The Limit of Boundaries: City-regions are different from sovereign states (and their constituent units, if any) because their importance is intimately connected to the fact that they have different boundaries for different purposes and that these multiple boundaries are themselves constantly in flux and usually

235 Phares, Metropolitan Governance, 1. 236 Ostrom, Governing the Commons, 90. 237 Cameron and Harcourt, City Making in Paradise, 185. 238 Ostrom, Governing the Commons, 90. 239 Sancton, The Limits of Boundaries, 7. 90 expanding. Such a state of affairs provides ample theoretical and empirical opportunity for social scientists to analyze and to measure. But practical politicians, who must build and nurture the institutions that make our relatively safe and comfortable lives possible, require more. They need to know where the ambit of one institution ends and where another one begins. In short, they need boundaries. Because we cannot draw stable multi-purpose boundaries for city-regions, we are incapable of designing the institutions that are needed for city-regions to be self-governing.240

Sancton’s argument that firm boundaries are necessary because the execution of regional government functions would otherwise be too complex for local institutions to carry out, echoes Ostrom’s insistence on the importance of boundaries. However, in the case of transit service delivery, the opposite seems to be the case. In other words, the existence of many small governing institutions with their own local boundaries — either at the municipal or county level — precludes the need for new city-regional boundaries while giving regional institutions the ability to expand or contract their jurisdictions to match the travel needs of residents. Furthermore, this flexibility has the additional benefit of forcing regional institutions to build support and remain accountable to all those within its jurisdiction — a feature not often characteristic of formal regional government structures set by provincial actors.

2. Transportation governance arrangements generally follow historic path dependencies related to provincial-municipal relations, revenue sources and capital project decision-making.

Reforms to transportation governance often do little to change long-standing operating policies or public support for certain types of revenue mechanisms. This is exemplified by TTC operators’ continued emphasis on intermodality, supply-led service, operating metrics based on set standards related to transit accessibility and the transit system’s continuing reliance on fare revenues as the primary source of funding. Likewise, the historic mix of revenue sources used in the Lower Mainland to fund transit — including electricity and gas sales, property taxes and fares — and combination of both provincially operated and locally operated transit services has today evolved into a regional transportation institution that incorporates all these historic elements. This follows Ostrom’s principle that there must be “congruence between appropriation and provision rules and local conditions,”241 where resources, responsibilities and methods that have historically been used to support transit in each region must be taken into consideration when establishing present-day transit operating and governance structures.

240 Sancton, The Limits of Boundaries, 137. 241 Ostrom, Governing the Commons, 90. 91

3. Inconsistent grant-based funding arrangements privilege a system of transportation planning that is project-oriented rather than oriented towards regional goals.

Unpredictable funding for capital projects from senior levels of government challenges the ability for local planning processes or knowledge to participate adequately in transit policy decision- making, ultimately leading to poorer long-term transit mode share outcomes. While the construction of large capital projects has always been political since the introduction of public subsidies — a point made by a Toronto planner in the 1960s — the provincial use of one-time grants that are themselves often dependent on outside funding or stipulate certain technologies or route alignments leads to sub-optimal capital project selection. Funding capital projects also should be understood for its opportunity costs; namely, funding transit operations. As a result, transit agencies have now become more exposed to unpredictable changes in the economy since they lack recourse to provincial operating funding to help them weather recessionary environments. Furthermore, it also means operating and service levels are not as responsive or accountable to public opinion because they are not tied to specific funding sources but are rather decided by political and administrative actors. The TTC’s use of crowding standards in the 1970s as a means of combating politically driven operating services that are against the best interests of regional accessibility is the most clear example of the need for governance mechanisms to specifically involve itself in operating standards.

4. Interdepartmental collaboration and public consensus-building processes are crucial for establishing sustainable and successful transportation institutions.

Toronto’s success during the 1970s and 1980s and the successes of the mid-1990s in Vancouver where TransLink was formed following the goals set out in the Livable Region Strategic Plan and Transport 20201 were the result of new partnerships and multidisciplinary committees. In Toronto, better relations between TTC staff and Metro Planners during the 1970s and 1980s led to capital and operating decisions that were self-supporting. In Vancouver, the integration within GVRD’s Department of Strategic Planning in the mid-1990s with both BC Transit staff and GVRD planners resulted in a land use plan and a transportation plan that mutually reinforced each others’ goals. This type of coordination matches Ostrom’s design principle that minimal recognition of rights to organize are necessary for common pool resource institutions to be successful. It does so by demonstrating how local freedom to collaborate and form partnerships

92 between different groups and organizations is crucial to the creation of successful and effective institutions. However, preceding both these collaborative efforts were extensive public processes — both government-initiated in the case of Vancouver and community-led in the case of Toronto — that brought political support for the new models that resulted from greater interdepartmental collaboration. In Vancouver, the “paralegal” survival of the Livable Region Programme and resulting Creating our Future process built the support necessary to make increased local control of transportation governance a politically charged issue. This facilitated the establishment of negotiations between the province and the GVRD that would eventually result in the creation of TransLink. In Toronto, the local activism of the Stop Spadina and Save Our City Coordinating Committee of the early 1970s similarly preceded the provincial decision to reorient transportation funding priorities to public transit. These two examples demonstrate the fundamental importance of creating institutions that rely on engaging local residents and communities for achieving successful transit oriented transportation policies.

Recommendations The findings of this paper suggest several recommendations for the organization of local government in favor of bringing about greater public transportation use:

A) Regional transportation governance institutions should be established through locally- initiated region-wide participatory processes that focus on visioning and revenue mechanisms.

Municipal governments, as the Vancouver case proves, need not wait for provincial leadership in regional transportation planning but rather should take matters into their own hands through beginning inter-jurisdictional consultation and collaborative processes. This will also lead to better regional outcomes by generating regional awareness and ultimately support for new transportation goals.

B) Responsibilities for new transportation governance institutions should be broad — including roads as well as transit and other forms of transit — and revenue raising abilities should be adequate and appropriate to allow for independent decision-making.

For extended periods in both Toronto and Vancouver — Toronto during the 1970s and 1980s and Vancouver from 2001 to the present — both regions proved that if provided sufficient revenues

93 and responsibilities they could significantly increase region-wide transit use. However, both periods were preceded by the establishment of operating metrics and revenue mechanisms — crowding stands and the users’ fare share formula in Toronto and new regional taxes to support planning goals set in Transport 2021 and Creating Our Future in Vancouver — that were crucial to the efficient use of the new power and resources.

C) Capital project planning should be transparent and the costs/technology should be aligned with regional resources and local support.

Repeatedly over the past four decades, capital project planning and construction has been fraught with political influence that has led to the design and purchasing and construction of sub-optimal public transit improvements that have burdened operations without supporting local goals. Furthermore, expensive technologies have hindered incremental network expansion and obstructed local influence over new projects. To avoid these problems going forward, new capital projects should reflect the buying power of local resources and support for transit. This will ensure that capital expansion can be maintained if it receives local support rather than depending on provincial support for future projects.

D) New transportation governance institutions should draw upon historical operating and revenue generating mechanisms when looking to create new coordinating bodies or revenue-generating mechanisms to improve public transit.

The histories of transit in both Toronto and Vancouver demonstrate the powerful influence of path dependencies on public transportation, particularly when it comes to funding services and coordinating modes. As a result, new regional bodies should look to build off these experiences and embed historic regional practices into new solutions for providing public transit. This will likely encourage greater local support for new transportation governance institutions by providing a conceptual framework to improve public transit that is familiar and recognizable to the public. Furthermore, they must take into account long-standing provincial-municipal relations if new institutions are to be successfully established, since both parties must come to the table to agree upon the responsibilities and functions of a new transportation body.

E) Responsibilities for transportation and the ability to raise local revenues should be based on the principle of subsidiarity, where responsibilities requested by regional bodies, if

94 confirmed by voting processes, should be devolved to lower levels of government along with the appropriate fiscal power to properly support their delivery.

It is clear from the two case studies that the formation of regional transportation governance institutions is perceived by provincial governments as a threat to their political power. This is supported by the refusal in many cases to devolve responsibilities or provide the necessary authority to regional bodies to solve transportation problems. The case of Metro Toronto’s inability to expand its jurisdiction beginning in the 1960s and its ultimate dissolution in 1998 in spite of a referendum overwhelmingly demonstrating local opposition to such a move support this claim. Likewise, provincial unwillingness in Vancouver to enforce the GVRD’s vehicle levy and its continued insistence on local property taxes supporting public transit despite regional distaste for this action also reflect the detrimental impact of provincial actions on local transportation. To avoid such a situation, regional-provincial negotiations should be undertaken in good faith, protected by legally enforceable mechanisms and should more strictly entrench the need for local planning and consultation processes to drive legislative actions that impact transportation. Legal tests could also be instituted that measure fairness and alignment to planning goals.

95 Conclusion Public transportation is a clear case where the costs required to establish high quality services are prohibitively high for individuals and therefore necessitate the creation of collective institutions. However, the shapes and sizes of institutions that deliver public transit services vary widely in scale and structure. The case studies of Toronto and Vancouver show that there are inherent benefits to public transit provision under regional governments, however these differ depending on the organization and structure of the regional government as well as its relationship with senior government. Furthermore, a more formalized structure of metropolitan government is not necessarily superior to a less formal governance structure, as the Vancouver case shows, in increasing transit mode share within urban regions. However, while structures are important, if anything the evolution of institutions for transportation governance in Vancouver and Toronto demonstrate that institutional arrangements are malleable. What is therefore more important is sustaining local support for regional transportation goals. Only if the public supports and has confidence in the abilities of regional transportation governance institutions can these bodies solve the transportation problems inherent to fragmented metropolitan regions. Both cities demonstrate that regional governance structures, when driven by participatory processes and local activism, can help to accelerate the growth of public transit usage in metropolitan areas. Such processes have proven that they can create institutions that can approve the revenues needed to match local goals and improve the coordination, operations, accessibility and ultimately, the use of public transit in metropolitan regions.

96 Interview Schedule 1. Marvin Shaffer - Chief GVRD Negotiator for 1998 TransLink Governance Interviewed on 16 February 2012, Skype

2. George Puil - Former City of Vancouver Councilor, Chair of the GVRD and first Chairman of TransLink Interviewed on 2 March 2012, Skype

3. Ken Cameron - Senior Planner and City Manager for the GVRD Interviewed on 12 March 2012, Personal Residence, Vancouver

4. Clive Rock - former Director, Strategic Planning and Policy for TransLink Interviewed on 12 March 2012, Ken Cameron’s Residence, Vancouver

5. Mitch Stambler - TTC Service Planning Manager Interviewed on 15 March 2012, TTC Davisville Headquarters, Toronto

6. Vince Rodo - General Secretary for the TTC Interviewed on 16 March 2012, TTC Davisville Headquarters, Toronto

7. Paul Bedford - former Chief Planner for City of Toronto and Metrolinx Board Member of Interviewed on 16 March 2012, , Toronto

8. David Gurin - former Chief Planner for the City of Toronto Interviewed on 27 March 2012, Broadway Au Lait Café, New York City

9. Jeffrey Busby - TransLink Manager of Infrastructure Planning Interviewed on 28 March 2012, Skype

10. - Design Coordinator for the Vancouver Skytrain, 1981-1983. Interviewed on 5 April 2012, Skype

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104 Appendix

*1972 was the final year where zone fares were individually counted Source: TTC Annual Reports

105

Source: TTC Annual Reports, 1954-2010

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Source: TTC Annual Reports, 1954-2010

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