This report, dated October 13, 2017, provides the Auditor General’s findings primarily in relation to whether there was any political interference involved in the crafting and dissemination of a particular briefing note about large transit project options for the City of Toronto. The title of this particular briefing note, dated June 29, 2016, is Issues Relating to Re-introduction of LRT Replacement for Line 3 (SRT).

The main complaint is that political interference resulted in inaccurate, incomplete and misleading information being provided to City Council about the costs of the Scarborough Subway Extension (SSE) compared to the Scarborough Light Rail Transit (SLRT) option. The complainant provides examples to support their assertion that misleading information was provided as a result of political interference. One of those examples is the briefing note. An analysis of other examples is included in the report.

The complainant asked the Auditor General to essentially do three things:

i. To conduct “an examination of the circumstances involved with the decisions to construct the SSE instead of the SLRT”. More specifically, the complainant alleges that the briefing note “erroneously and deliberately inflated the price of the SLRT option by approximately $1 billion.”

ii. “To investigate whether the mayor, city council and city administrators have appropriately exercised their responsibility of stewardship over public funds” in making the decision that they made to proceed with the SSE option.

iii. To investigate whether the SSE will achieve value for money.

The report addresses how the briefing note came to be drafted, evaluates the reasonableness of financial and other information in the note, addresses possible pressures influencing the contents of the note, and considers the process used to distribute the note.

It is not the Auditor General’s role to question the policy decisions of elected officials, nor is it the Auditor General’s role to reopen City Council decisions. Therefore, the Auditor General did not investigate items 2 and 3. A value for money/performance audit to examine management practices, controls, and reporting systems to achieve Council’s direction in a cost-effective manner is within the purview of the Auditor General, and may form part of a future audit.

i. No evidence of any lack of integrity on the part of TTC CEO Andy Byford or other TTC personnel in the preparation of the briefing note.

ii. No evidence of a systemic problem of political interference or staff being pressured by elected officials, including the Mayor and his office, in relation to the development of the ridership numbers and the preparation and distribution of the note.

iii. In our view, the briefing note estimate for the costs of the SSE compared to the SLRT were within an acceptable range given the state of the project, the nature of a briefing note and the caveats contained therein. The briefing note highlights that the figures are “estimates only,” intended for a “high level cost comparison.” After evaluating the reasonableness of the figures, it is our view that even if construction on the SLRT could have begun several years earlier, the potential difference between the briefing note figures and our calculated escalated cost is within an acceptable range for estimates at that stage of completion.

Read the Full Report

Review of Complaint Regarding the June 29, 2016, Toronto Transit Commission Briefing Note – October 13, 2017

Audit Committee Agenda Item

AU10.11 – October 27, 2017