Ontario auditor general slams transit agency for millions in cost overruns
Metrolinx, the provincial transit agency, came under fire Wednesday from Ontario's auditor general, whose latest report details delays and cost overruns in the hundreds of millions of dollars due to late changes in plans for light-rail transit projects, and allegations of political influence over decision-making about the placement of new GO Transit stations.
Auditor General Bonnie Lysyk unveiled the findings during a news conference at Queen's Park. Her office conducted audits of 15 provincial departments and programs.According to Lysyk, Metrolinx, which controls regional transit across the Greater Toronto and Hamilton area, incurred about $436 million "in sunk and additional" — unrecoverable — costs between 2009 and 2018 due to changes in transit planning over the last decade, and problems with how the agency itself is doing its work."After certain projects were announced or agreed on, the provincial and municipal governments changed their decisions on what to build and when to build, even though significant investments had already been made," Lysyk said Wednesday after her report was tabled in the legislature.She cited Toronto's Scarborough subway project as an example, with plans changing three times between 2011 and 2013. The city is still in the early planning stages of building a multibillion-dollar one-stop subway extension, although Premier Doug Ford has expressed a preference to build a three-stop version of the line.
The Sheppard light-rail project was also highlighted, with its 10-year delay beyond the initial expected completion date of 2013. These projects added up to some $125 million in "sunk costs, with $75 million to be recovered by the City of Toronto," Lysyk said.She also cited Metrolinx's decision to sign what's called an Alternative Financing and Procurement (AFP) contract with the consortium tasked with building Toronto's Eglinton Crosstown LRT. Such contracts typically include a premium for the private-sector partners assuming the risks of cost overruns and delays. But according to Lysyk, under this contract, Metrolinx had to pay the consortium $237 million in 2018 to ensure the project still meets its September 2021 target date.
But in 2016, "Metrolinx overrode that conclusion because the then-minister of transportation (Liberal Steven Del Duca) and City of Toronto made it clear they wanted these stations," Lysyk said.In her comments, Lysyk said Metrolinx "undermined its own decision-making process and inappropriately changed its recommendations on the Kirby and Lawrence East stations." She pinned the blame on "influence" by Del Duca and the city.
Safety agency, Waterfront Toronto criticizedOther findings of the auditor general's report include:
Lysyk's office also looked at the refurbishment of the Darlington Nuclear Generating Station, and found that Ontario Power Generation (OPG) "has put a clear accountability structure in place" to monitor the work and ensure it comes in on time and on budget. However, the project faces "significant risks," including a potential shortage of skilled tradespeople, that could affect both, she said.
Darlington, one of the province's two nuclear stations, began operating in 1990 with four reactor units that are nearing the end of their working life. The facility provides Ontario with about 15 per cent of its electricity. The refurbishment project is estimated to be completed by 2026 and carries a price tag of $12.8 billion. The work will extend the life of the units to about 2055.Issues that could lead to delays and cost overruns include stiff competition for skilled tradespeople during years when the refurbishment work will overlap with similar work at the Bruce Nuclear Generating Station, Lysyk said. There are also concerns that the OPG has had to provide more assistance to contractors that initially planned, and those costs have yet to be factored into the profit that to be paid to the contractors.