A city report requested by councillors to estimate operating and maintenance costs of Hamilton’s proposed 3.4 billion LRT project is suggesting the annual price tag for taxpayers is likely somewhere between $6.4 million to $16.5 million.
The analysis, calculated by the city manager and staff, says the estimates are essentially an “assumption” made using previously generated costs from a 2013 rapid transit feasibility study adjusted for inflation.
On Wednesday, Hamilton’s general issues committee will reconvene to discuss mayor Fred Eisenberger’s motion to prepare a memorandum of understanding with Metrolinx and other government entities for the project, after it was deferred by councillors following questions over the financial impact of line.
In the June 2 session, Ontario’s assistant deputy minister for the ministry of transportation, James Nowlan, told councillors the rough estimate for operating and maintenance was about $20 million annually.
Tomorrow’s report is set to answer questions from some councilors on how retiring buses on the east-west corridor and eliminating incentive programs encouraging downtown investment could possibly free up money needed to alleviate the potential annual bill to run the LRT.
“Where on the range of net operating costs a Hamilton LRT would be on Day 1 of operations would depend on future service level, ” the report said.
The methodology of the report goes back to files from 2008 with estimates from the 2013 Rapid Ready study supplemented with 2019 HSR operating adjustments.
It also makes assumptions based on a pair of scenarios involving potential ridership of the new service plus changes in bus deployment and service hours.
Dollar figures in both scenarios are also affected by ridership growth, which city staff estimated to either be zero per cent or eight per cent.
The first scenario suggests a net operating cost at the launch of the LRT to be $6.4 million with eight per cent ridership or $10.4 million at zero per cent ridership should 29 buses and 103,000 hours of service be removed from the system.
The second projects costs to be between $12.5 million with eight per cent ridership and 16.5 million at zero percent ridership should 13 busses be eliminated with 33,000 hours of service cut.
On Wednesday, councillors will also look over two other reports tied to development in in the city’s core and along the proposed LRT route. The analysis is expected to paint a picture of what projects have been completed and what is coming in addition to what incentives are offered for developers in the core.
Hamilton Transit Allaince
A coalition of six local organizations have submitted correspondence for the GIC meeting on Wednesday endorsing a call to from the Amalgamated Transit Union (ATU) Local 107 to drop the LRT into the perview of the HSR.
The Hamilton Transit Alliance (HTA) says the move would “fulfill” a requirement setout in the collective agreement between ATU 107 and the city of Hamilton in addition to allowing for integration of the two transit services.
The HTA signatories are: ACORN Hamilton, the ATU, Hamilton Centre for Civic Inclusion, Hamilton District Labour Council, Environment Hamilton and the Hamilton Transit Riders Union.
“HSR operation and maintenance of the LRT would ensure that any profits generated in the future by the LRT can be directly invested back into the system,” the coalition said in their correspondence.
“It is also the easiest way to ensure that public transit customers have a consistent service network-wide – something that cannot be said for riders who rely on public transit in other cities that have multiple local transit operators.”