TTC faces budget shortfall

Faced with a mounting cash shortfall, the Toronto Transit Commission warned Wednesday that it has a difficult choice it must either raise fares or cut services.

The TTC had acknowledged a $39-million shortfall, but TTC chairwoman Karen Stintz said the city might also cut its subsidy to the transit agency, which would mean a hit of some $42 million, more than doubling the reported shortfall.

Gary Webster, the TTC's general manager, said everything would be looked at to reduce costs including service levels and even job cuts.

"What are we going to do about service? Can we afford all the service we have? What about fares? Can we afford not to have a fare increase?"Webster questioned.

But the biggest question surrounds a fare increase. It is estimated that a 25-cent increase would only address about half of the TTC predicted shortfall.

Some 500-million riders are expected to use the city's public transit in 2012, which would add even more expense to the cash-strapped service.

Adding further pressure to the already stressed budget is the consideration of declaring the TTC an essential service. Many estimate that if that legislation were passed it would also add more costs in contract expenses.

"I urged them in December to consider the serious ramifications of recognizing the TTC as an essential service and the absorbitant consequence to the public purse. How clear can you be?" said Councillor Maria Augimeri.

"Every place on earth that has gone through this has told them this is the truth. They don't listen to the truth."

The TTC is expected to present a balanced budget by the fall.