Last week, the TTC was ordered to pay $60 million to a construction contractor, to settle a seven-year legal dispute. It was over rising costs and delays on the construction of the Pioneer Village subway station on the northward Spadina extension to Vaughan that opened in 2017.
The judgment, which is currently under appeal, pulls back the curtain on the types of project management decisions that lead to transit construction cost overruns and delays that are frustrating Torontonians.
It also highlights two challenges facing new-build transit projects: choosing the best project management model and picking the right projects that will improve transit most.
In the case of the Pioneer Village station at Steeles Avenue and Keele Street, the TTC opted for a traditional government led procurement approach. This meant government control over project design and management, but also government risk if the design contributed to delays and rising costs.
The TTC chose to build new stations that were monumental in size, each with their own unique iconic design.
The TTC then selected a construction contractor before the detailed design for the Pioneer Station was finalized. The station’s design, as well as its interior art concept, proved far more complex to build, leading to many change orders and adding significant cost for the contractor.
The TTC also struggled with co-ordinating multiple contractors building different parts of the line, leading to further delays and rising cost for the Pioneer Village station builder.
In the aftermath of the troubled Spadina subway extension project, a different model was established to deliver the next wave of transit construction — the Eglinton Crosstown and Finch LRT. Provincial agencies Metrolinx and Infrastructure Ontario are in charge of these.
They opted for the much-hyped public-private partnership as the touted remedy to solve past problems, by transferring risk to the private sector.
Additionally, Metrolinx and Infrastructure Ontario opted for fairly simple station designs, existing technologies and hired experienced project management staff, consultants and contractors. These are common strategies to manage transit construction costs.
Nevertheless, the outcomes appear to be more of the same. The Eglinton Crosstown is much delayed and over budget. It too has experienced lawsuits over escalating costs, with at least some settlements going in favour of the contractor.
None of this is an isolated Toronto area problem. The delivery of LRT projects through public-private partnerships in Ottawa and Edmonton have struggled mightily. And according to research from the Maron Institute of Urban Management at New York University, transit construction costs per kilometre are skyrocketing globally.
Now a new philosophy on procurement is taking hold in Ontario that emphasizes deeper public-private collaborations and the fostering of trusting relationships to share risk, avoid legal disputes, and better meet project goals. Â Â
Time will tell whether an industry based on adversarial relationships and winner takes all business strategies can pull together for the collective good of needed transit projects.
But one thing is certain. At a time when transit building costs are ballooning and construction problems are all but assured, it’s crucial to be selecting the right projects and developing complete communities around them to attract riders and deliver long-term benefits. This is something that has not been happening consistently in the Toronto region.
Nearly half the stations on the two most recently opened subway lines in Toronto (the Sheppard line and the Spadina subway extension) have among the lowest ridership on the system.
Developments occurring around new stations have struggled to complement dense housing with a mix of employment, retail, community amenities and pedestrian friendly streets. This runs the risk of reproducing auto-oriented neighbourhoods that do not contribute a mass of new transit riders.
And fears of gentrification are growing in areas where new transit lines are coming in the absence of policy to ensure development without displacement.
As Greater Toronto undertakes the biggest transit building boom in a generation, much work is needed to ensure that the projects are in the right place to attract riders, are effectively delivered, and foster complete, thriving communities.
No one said city-building was easy.
