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$1 Billion boost to TTC

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$1B to boost TTC

Martin kickstarts deal, McGuinty takes personal interest

Announcement tied to subway's 50th anniversary March 30

The TTC is getting an unprecedented $1 billion boost in funding from all three levels of government, the Star has learned.

The Ontario cabinet gave final approval yesterday for the money, which would be spread over five years.

And one senior official in Ottawa billed the program as "the most significant investment in public transit in Toronto in a generation."

Sources both in the provincial government and in Ottawa say Premier Dalton McGuinty and Prime Minister Paul Martin each took a personal interest in the plan to renew the city's aging transit system and that the funding announcement details will be tied to the 50th anniversary of the opening of the Yonge subway line, on March 30, 1954 ? Canada's first subway system.

Martin, who has taken personal charge of the municipal issue, kickstarted this deal, officials in Ottawa said. It follows on the heels of Martin's announcement in the February throne speech of an immediate GST rebate for municipalities, which means an additional $50 million annually for Toronto.

This week, Martin reasserted his commitment to give municipalities a share of the gas tax, provided that an arrangement can be worked out with the provinces. Ontario has committed 2 cents a litre of its gasoline tax to municipalities.

That commitment is expected to be rolled out over several years as the Liberals grapple with a $5.6 billion deficit inherited from the Conservatives.

More will be learned when the two governments unveil their budgets. The federal budget will be presented March 23 and the provincial budget will follow in April or May.

The planned TTC package will be sweeping, aides in the Prime Minister's Office said, and will include funds for everything from new equipment to track construction.

Federal minister of state for infrastructure, Andy Scott, has also been heavily involved in the negotiations. Ottawa's contribution is coming from the $3-billion infrastructure fund.

But McGuinty and Martin are said to be planning to formally announce the new deal for the TTC at subway anniversary celebrations on March 30. Staff from the Prime Minister's Office have reportedly been scouting locations in the city for a news conference.

Under the plan, the money will be spread evenly over five years, or about $200 million a year.

The federal government is eager to get the money flowing immediately.

A spokesperson for the Prime Minister's Office said the money is being spread out over five years for planning purposes.

"The lead time in ordering subway vehicles and buses is often three years at a minimum, so expect delivery schedules and building schedules to be the bottleneck for renewal of the system, not cash flow," the official said.

However, it is not clear the money will be enough to patch up the transit system. The TTC's operating budget for 2004 is heading for a $48 million shortfall. Its capital needs are pegged at about $400 million a year for the next 10 years just to keep what it has, but it wants to expand bus, streetcar and subway networks.

TTC commissioners have yet to decide on a looming fare hike, but estimates have ranged it will be 10 cents to 25 cents a ride.

The TTC wants $230 million this year from city council, up from $182 million last year. Much of the increase is due to higher wages for the 10,000-member workforce. But the city is facing a $344 million shortfall, and officials have asked all departments and affiliated agencies to tighten their belts.

The city's senior management team has only budgeted $219 million for the TTC, and budget chief David Soknacki wants another $10 million in savings.

As the federal Liberals gear up for a likely spring election, Martin has been saying that he is determined to show that he's putting his money where his mouth is on the new deal for cities and towns; that so-called "down payments" are a measure of his promises' credibility. The TTC deal is one of those.

"We want to see things happen on transit," said an aide, adding that Martin wants to get other infrastructure projects going soon, to help GO and other transit systems across the country.

Despite the deal being billed as a three-way effort, it is not known how much of a contribution will be expected from Toronto, since the transit commission has stated that it is teetering on the verge of major service cuts or else a sizeable fare hike in order to live within its budget.

A provincial source said funding for other municipal public transit systems will follow, but added that the Premier makes no apologies for singling out Toronto for special treatment, especially given the party's recent election commitment to make cities more liveable and cleaner.

Ontario government sources credited both Scott and his provincial counterpart, Public Infrastructure Minister David Caplan, for quickly ironing out the plan. One provincial Liberal said Transportation Minister Harinder Takhar made a solid case for the TTC funding boost to his colleagues.

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There's talk of tolls on the Gardiner and DVP freeways which lead to downtown to possibly pay for transit, though they'll have to cover the costs of road maintenance first.

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