June 19, 1998

Ms. Novina Wong
Clerk
City of Toronto
Station 1071, 7th Floor
Metro Hall
55 John Street
Toronto, Ontario
M5V 3C6

Dear Ms. Wong:

At its meeting on Wednesday, June 17, 1998, the Commission considered the attached report entitled, "1998 Wheel-Trans Budget Update."

The Commission approved the Recommendation contained in the above report, as listed below:

"It is recommended that the Commission approve:

1. Increasing the 1998 Wheel-Trans Operating Budget of $38.2M by up to $625,000, and the workforce complement from 380 to 383, as set out below:

a) Increasing the Sedan Taxi service by up to $400,000 to accommodate unbudgeted costs associated with increased trip demand;

b) Increasing the Wheel-Trans maintenance costs by $75,000 as a result of decreasing Orion bus reliability and thereby delaying the planned reduction of the Wheel-Trans Maintenance workforce; and

c) Allocating the legal costs associated with the current Canadian Charter of Rights and Freedoms Challenge of the Wheel-Trans application process and eligibility criteria, in the amount of $150,000 to the 1998 Wheel-Trans Operating Budget; and

2. Increasing the current purchase order upset limits of the Sedan Taxi Contracts by up to $400,000 in order to provide for these additional trips;

3. Forward this report to the City of Toronto requesting City Council approval, through the City Budget Committee, of a draw from the Corporate Contingency Account in the amount of $625,000, bringing the 1998 Budget to $38.8."

The foregoing is forwarded to City of Toronto Council for the necessary approval, as detailed in the report.

Sincerely,

Vincent Rodo

General Secretary

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Attachment

TORONTO TRANSIT COMMISSION

REPORT NO.

MEETING DATE: June 17, 1998

SUBJECT: 1998 WHEEL-TRANS BUDGET UPDATE

RECOMMENDATION

It is recommended that the Commission approve:

1. Increasing the 1998 Wheel-Trans Operating Budget of $38.2M by up to $625,000, and the workforce complement from 380 to 383, as set out below:

a) Increasing the Sedan Taxi service by up to $400,000 to accommodate unbudgeted costs associated with increased trip demand;

b) Increasing the Wheel-Trans maintenance costs by $75,000 as a result of decreasing Orion bus reliability and thereby delaying the planned reduction of the Wheel-Trans Maintenance workforce; and

c) Allocating the legal costs associated with the current Canadian Charter of Rights and Freedoms Challenge of the Wheel-Trans application process and eligibility criteria, in the amount of $150,000 to the 1998 Wheel-Trans Operating Budget; and

2. Increasing the current purchase order upset limits of the Sedan Taxi Contracts by up to $400,000 in order to provide for these additional trips;

3. Forward this report to the City of Toronto requesting City Council approval, through the City Budget Committee, of a draw from the Corporate Contingency Account in the amount of $625,000, bringing the 1998 Budget to $38.2 million.

FUNDING

The 1998 Wheel-Trans Operating Budget did not provide sufficient funds to accommodate the increased demand, accelerated decline of Orion fleet reliability, and costs associated with the Challenge under the Canadian Charter of Rights and Freedoms. Therefore, the additional funding of up to $625,000 is an unbudgeted expense.

BACKGROUND

Demand

The 1998 Wheel-Trans Operating Budget provided for a trip demand of 1,415,000. The TTC Accessible Transit Services Plan 1998-2002, which utilized Metro Planning Department demographic studies as well as actual Wheel-Trans experience during 1997, and the Transit Accessibility Needs Study prepared for the Metro Council Advisory Committee to the TTC Task Force on Accessible Transit, predicted Wheel-Trans demand would increase by about 3% per annum. However, the 1998 Wheel-Trans trip demand was increased by approximately 6% in order to reflect full year impact of the significant registrant growth throughout 1997 combined with an additional 2% projected registrant growth in 1998 and a trip utilization rate increase of 1%.

Experience in the first half of 1998 indicates the increase in trip demand by year-end will be in the order of 2% to 3% above the 1998 budget estimates. This translates into an additional 40,000 trips requested. In order to achieve the goal of a 2% unaccommodated rate for the remainder of 1998, the Wheel-Trans Operating Budget would have to be increased by up to $400,000. The additional trips would be provided by sedan taxi contractors because the available accessible taxi fleet will be used to capacity and the unreliability of the aging Orion fleet means they cannot accommodate the added demand.

Legal Costs

Legal costs associated with the Canadian Charter of Rights and Freedoms Challenge regarding the Wheel-Trans eligibility criteria and application process are anticipated to be $150,000 for 1998. This Challenge was forwarded to the Commission in March, 1998 and therefore was not provided for in the 1998 Wheel-Trans Operating Budget.

Orion Maintenance Costs

The declining reliability of our Orion bus fleet results in both customer inconvenience when trips are interrupted and additional cost to achieve Wheel-Trans budgeted service levels. In order to maintain the Orion service levels for the remainder of 1998, the planned maintenance workforce reduction will not be possible. Funding in the amount of $75,000 is required to provide for additional maintenance resources for the balance of 1998.

DISCUSSION

The 1998 Wheel-Trans Operating Budget of $38.2M is comprised of $36.2M for service and $2.0M to begin replacement of the aging Orion fleet scheduled to take place over the next five years. This Orion replacement plan was approved by the Commission in August, 1997 when the report of the TTC Task Force on Accessible Transit and Five Year Accessible Transit Services Plan were presented.

In 1998, staff have taken action in order to maximize service within the funding available. Wheel-Trans has improved scheduling efficiency and productivity is up. New Zone Service has been introduced and consideration is currently being given to expanding this Zone service in early 1999 rather than later as originally planned. With the introduction of a new Cancellation Policy in 1997, the cancellation rate initially decreased to 9%, however, the rate has increased to 12% during 1998. This increase has had a negative impact on our ability to provide additional trips within the funds available. A report will be submitted later this year recommending changes to this policy in order to bring the rate of cancellations to an acceptable level.

The increased 1998 Wheel-Trans demand is due to a combination of an expanding registrant base (currently 15% or 1,800 higher than the 1998 year-end target level of 11,600) and increased trip utilization by these registrants. The milder winter weather, improved quality of service, and positive response to the new Downtown Zone Service have all contributed to this increased utilization of the service and an overall increase in our trip demand. As a result of this increased demand, the unaccommodated rate has risen from 2% to 4%.

Alternatives were considered to address this additional demand. One involves maintaining service with current funding ($36.2M) which will result in an increased unaccommodated rate of 6.5-7.5% for the last six months of this year (overall 5.5% for 1998). This is not an acceptable option as it means the quality of service will continue to deteriorate to an unacceptable level.

An alternative to use part of the $2 million dedicated in the 1998 budget for Orion bus replacement is not an option. This is not recommended as it will delay the replacement of the Orion fleet, a key component of the approved Five Year Accessible Transit Services Plan, required to reduce operating and maintenance costs and to improve service. Proposals for replacing the Orion Bus fleet will be tendered in July with the approval to award a contract anticipated in August, 1998.

The recommended option is to maintain the 2% unaccommodated rate for the remainder of 1998 (currently 4%), by maximizing the level of service available from Orions and accessible taxis, and increasing funding by up to $400,000 to accommodate additional taxi trips to year- end. This additional funding would be drawn on as needed by adjusting contracted taxi purchase orders.

In order to respond to the reliability problems with the Orions and maintain current levels of service, an increase of $75,000 is required for maintenance staff in 1998. It was anticipated in the 1998 budget that a reduction in maintenance costs could be accomplished, however, the reliability problems experienced to-date suggest cost reductions in this area are not realistic and could contribute to being unable to provide service at the levels required. Our peak hour vehicle allocation is now down to 115 vehicles while in 1997 it was still possible to schedule 117 vehicles for peak service.

With regard to the legal costs for the challenge under the Charter of Rights and Freedoms, this item was not foreseen in the 1998 Operating Budget and, given the situation outlined above, this cost cannot be accommodated in the remainder of 1998. As such, a separate allocation should be established as part of the Wheel-Trans funding.

JUSTIFICATION

It is appropriate for the Commission to authorize up to an additional $625,000 for the Wheel-Trans budget to address higher than budgetted demand, the inability to reduce our maintenance costs and the funds necessary for the legal costs associated with the Charter challenge.

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June 8, 1998

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