II' McCOR,\-IICK RANKI' CORPORATION

Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham

FINAL REPORT October 27, 2004

lE~ architects planners

in association with:

---~--

C.N. WATSON

Al\'O ASSOCIATES L TlJ.

October 27'11, 2004

TIH engineers architects planners

Mr. Alex L. Georgieff Commissioner of Planning The Regional Municipality of Durham P.O. Box 623 605 Rossland Road East Whitby, ON L1 N 6A3

Dear Mr. Georgieff:

Re: Business Case Analysis for the Potential Transfer of Lower Tier Municipal Transit Services to The Regional Municipality of Durham

Totten Sims Hubicki Associates 300 Water Street Whitby, Ontario, Canada L 1 N 9J2 (905) 668-9363 Fax: (905) 668-0221 E-mail: tsh@tsh.ca www.tsh.ca

Totten Sims Hubicki Associates is pleased to submit this report outlining our findings and recommendations associated with the above captioned study. Along with our partners, McCormick Rankin Corporation, KPMG, C.N. Watson and Associates Ltd., and Aird & Berlis, LLP, we have been most pleased to undertaken this study on behalf the Region of Durham.

A common characteristic of successful and economically sustainable communities is a strong, integrated transit system that compliments the other transportation services available to area residents. The conclusions and recommendations resulting from the work associated with the Business Case Analysis indicates that an integrated transit system, comprised of conventional and specialized services, and operated and funded by the Region of Durham, can be justified.

We believe that the arguments in favour of the transfer of transit services to the Region of Durham are strong and amalgamation of conventional and specialized services is considered to be in the best interest of the community, from a social, environmental and economic perspective. We hope that the recommendations contained in the document will permit Regional Council and local municipalities to move forward with an initiative that we feel is an important element of the overall transportation services provided by the Region.

We have been most pleased to work with your staff, and the staff of other regional departments, in

completing this challenging and complex assignment.

We look forward to having a chance to present and discuss our findings with your staff, RTIC and Regional Council.

y our~ very truly, , .~ / /

'~- ~ D.I Allingham, P. Eng. Pr ident

DIA/an End: LetAGeorgidfBusi nessCaseAnal ys is

Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services 10 the Regional Municipality of Durham October 2004

TABLE OF CONTENTS

EXECUTIVE SUMMARY ......................................................................................................................... I

PART A: OVERVIEW OF CURRENT SERVICES AND POLICY FRAMEWORK

1 INTRODUCTION .............................................................................................................................. 1

1.1 STUDY PURPOSE ............................................................................................................................................... 1 1.2 BACKGROUND .................................................................................................................................................. 1 1.3 ISSUES SURROUNDING TRANSIT AND AMALGAMATION ................................................................................... 2

1.4 STUDY ApPROACHIMETHODOLOGY ................................................................................................................. 2 1.4.1 Business Case Analysis Framework. ............................................. .......................................................... 3

1. 5 CONSULTATION PROCESS ............... '" ............................................................................................................... 4 1.5.1 Stakeholder Consultation .......................................... .............................................................................. 4 1.5.2 Meetings with Other Agencies ................................................................................................................ 4 1.5.3 Technical Steering Committee ............................................... ................................................................. 5

1.6 TECHNICAL ADVISORY GROUP ......................................................................................................................... 6

2 POLICY FRAMEWORK .................................................................................................................. 7

2.1 REGIONAL OFFICIAL PLAN (ROP) .................................................................................................................... 7 2.2 REGIONAL COMMUNITY STRATEGIC PLAN (CSP) ............................................................................................ 7 2.3 REGIONAL TRANSPORT A nON MASTER PLAN (TMP) ....................................................................................... 7 2.4 DURHAM TRANSIT IMPROVEMENT PLAN (TIP) ................................................................................................ 8 2.5 PLACES TO GRow/INFRASTRUCTUREFINANCING FRAMEWORK- ONTARIO .................................................... 9 2.6 SUMMARY ...................................................................................................................................................... 10

3 OVERVIEW OF EXISTING TRANSIT SERVICES ................................................................... 12

3.1 CONVENTIONAL TRANSIT ............................................................................................................................... 12 3.1.1 Ajax-Pickering Transit Authority .................... ...................................................................................... 12 3.1.2 Whitby Transit ................................................ ....................................................................................... 12 3.1.3 Oshawa Transit ................................................ ..................................................................................... 12 3.1.4 Clarington Transit ........................................................................................................................ ........ 13 3.1.5 GO Transit ............................................................................................................................................ 13 3.1.6 Transit Services to the North ................................................................................................................ 14 3.1. 7 Conventional Transit Comparison ........................................................................................................ 14 3.1.8 Transit Initiatives by the Region of Durham .............................................. ........................................... 16

3.2 SPECIALIZED TRANSIT .................................................................................................................................... 16 3.2.1 Handi Transit ... : ........................................... ......................................................................................... 16 3.2.2 APTA Specialized Transit ............................................... ...................................................................... 17 3.2.3 Community Care - Brock. ........................... .......................................................................................... 17

3.3 ASSETS ........................................................................................................................................................... 18 3.4 FUNDING OF EXISTING TRANSIT SERViCES ..................................................................................................... 20

3.4.1 Regional Transit Funding ............................................... ............ : ......................................... ................ 20 3.4.2 Conventional Transit ............................................................................................................................ 20 3.4.3 Specialized Transit ............................................... ................................................................................. 27

3.5 SUMMARY ...................................................................................................................................................... 28

4 LESSONS LEARNED FROM OTHER JURISDICTIONS ......................................................... 29

4.1 SCOPE OF REVIEW ................................................................................. , ........................................................ 29 4.2 BACKGROUND ............................................................................................................................................ 29

4.2.1 Grand River Transit .................... ........................................................................................................ 29 4.2.2 York Region Transit ............................................... ................................................................. ............ 30

4.3 SERVICE STANDARDS ..................................................................................................................................... 30 4.4 FINANCIAL OPPORTUNITIES AND CONSTRAINTS ............................................................................................. 31

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Business Case Analysis for the Potential Transfer of Lower-Tier Mllnicipal Transit Services to the Regio/lal Municipality of Durham October 2004

4.5 ASSET TRANSFER STRATEGIES ....................................................................................................................... 31

4.6 MANAGEMENT, ORGANIZATION/GOVERNANCE ............................................................................................. 32 4.7 HUMAN RESOURCES ....................................................................................................................................... 33

4.8 IMPLEMENTATION OPPORTUNITIES AND STRATEGIES .................................................................................... 34

4.9 SUMMARY ...................................................................................................................................................... 35

4.10 PART A CONCLUSIONS ............................................................................................................................... 35

PART B: VISION FOR TRANSIT IN DURHAM

5 TRANSIT VISION/OBJECTIVES ................................................................................................. 37

5.1 DEMAND FOR FUTURE TRANSIT SERVICES ..................................................................................................... 37

5.2 TRANSPORTATION VISION .............................................................................................................................. 38

5.3 TRANSIT VISION ............................................................................................................................................. 38

5.4 GOALS AND OBJECTIVES ........................................................................................................................ 40

5.5 CHALLENGES TO THE IMPLEM-ENTA nON OF THE REGION'S TRANSIT VISION ....................... 41 5.6 SUMMARY ...................................................................................................................................................... 42

6 TRANSIT POLICIES AND SERVICE STANDARDS ................................................................. 43

6.1 EXISTING AND PROPOSED SERVICE STANDARDS ............................................................................................ 43

6.2 SUMMARY ...................................................................................................................................................... 46

6.3 PART B CONCLUSIONS ................................................................................................................................... 46

PART C: A NEW APPROACH TO TRANSIT

7 NEED AND RATIONALE FOR INTEGRATED TRANSIT IN DURHAM ............................. 47

7 .1 INTEGRATED TRANSIT .................................................................................................................................... 47

7.2 NEED AND RATIONALE ................................................................................................................................... 48

7.3 SUMMARY AND CONCLUSIONS ....................................................................................................................... 54

8 DELIVERING INTEGRA TED TRANSIT FOR DURHAM ....................................................... 56

8.1 SERVICE DELIVERY OPTIONS ......................................................................................................................... 56

8.1.1 Status Quo ..................................................... ........................................................................................ 56 8.1.2 Enhanced Status Quo ................................................... ......................................................................... 56 8.1.3 Full Amalgamation ............................................................................................................................... 56

8.2 ASSESSMENT OF SERVICE DELIVERY OPTIONS ............................................................................................... 57 8.2.1 Factor Group Descriptions ................................................................................................................... 57

8.3 EVALUATION OF SERVICE DELIVERY OPTIONS ............................................................................................... 59

8.4 CONCLUSIONS ................................................................................................................................................ 76 8.5 PART C CONCLUSIONS ................................................................................................................................... 77

PART D: INVESTING IN REGIONAL TRANSIT SERVICES

9 SERVICE OPERATIONAL PLANS .............................................................................................. 79

9.1 OBJECTIVES .................................................................................................................................................... 79

9.2 OVERVIEW OF GENERAL ApPROACH .............................................................................................................. 80

9.3 SERVICE PLAN ASSUMPTIONS ........................................................................................................................ 84

9.4 OVERVIEW OF 5 YEAR PLANS AND YEAR 10 OUTLOOK ................................................................................. 87

9.4.1 Conventional Transit ............................................................................................................................ 87 9.4.2 Specialized Transit ................................................. ............................................................................... 88 9.4.3 10 Year Outlook .................................................................................. .................................................. 89

9.5 RECOMMENDATIONS ...................................................................................................................................... 89

10 THE COST OF REGIONAL TRANSIT ........................................................................................ 90

10.1 CONVENTIONAL TRANSIT- YEARS 1 THROUGH 5 AND YEAR 10 OPERATING NET COSTS ......................... 90

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10.1.1 Status Quo ........................................................................................................... ............................ 90 10.1.2 Regional Transit ........................................................................................................................ ....... 94

10.2 CONVENTIONAL TRANSIT- YEAR 1,5 YEAR AND YEAR 10 CAPITAL COSTS .......................................... 102 10.2.1 Status Quo ............................................................................................................ .......................... 102 10.2.2 Regional Transit ............................................... .............................................................................. J04 10.2.3 Financing of Capital Investments ................................................................................................... 107

TABLE 10.5 FINANCING OF CAPITAL INVESTMENTS .............................................................................................. 108 10.3 SPECIALIZED TRANSIT- YEAR 1, 5 YEAR AND YEAR 10 NET OPERATING COSTS ................................... 109

10.3.1 Status Quo ...................................................................................................................................... 109 10.3.2 Regional Transit/Specialized Transit ............................................................................................. 111

10.4 SPECIALIZED TRANSIT- YEAR 1, 5 YEAR AND YEAR 10 CAPITAL COSTS ............................................... 114 10.4.1 Status Quo ................................. ..................................................................................................... 114 10.4.2 Regional Transit Capital Costs ..................................................................................................... 116

10.5 SUMMARy ................................................................................................................................................ 118

11 TRANSFERING AND OPERATING REGIONAL TRANSIT ................................................. 121

11.1 THE REGIONAL TRANSIT CONCEPT .......................................................................................................... 121 11.2 TIMING ..................................................................................................................................................... 121 11.3 PHASE 1 - FRAMEWORK FOR TRANSFER .................................................................................................. 122

11.3.1 Asset Transfer .................................................................... ............................................................. 122 11.3.2 Staffing ...... ...................................................................................................................................... 123 11.3.3 Local Transit Service Retention and Expansion ...................................................... ....................... 123 11.3.4 Funding .......................................................................................................................................... 124 1 I.3.5 Legislation ...................................................................................................................................... I28

11.4 PHASE 2 - THE TRANSITIONAL PERJOD ................................................................................................... 130 11.4.1 Transition Working Committee ....................................................................................................... 131 11.4.2 TWC Sub-Committee Structure and Key Activity Listing ............................................................... 131 11.4.3 Oversight Sub-Committee .............................................................. ................................................. 150

11.5 PHASE 3 - IMPLEMENTATION AND MONITORING ..................................................................................... 150 11.5.1 Detailed Service and Strategic Planning ........................................................................................ 150 11.5.2 An Annual Transit Report Card ...................................................................................................... 150

12 ORGANIZATIONAL STRUCTURE ........................................................................................... 155

12.1 EXISTING ORGANIZATIONAL STRUCTURES .............................................................................................. 155 12.2 REVIEW OF ORGANIZATIONAL OPTIONS .................................................................................................. 157

12.2.1 York Region Transit- YRT.. ........................................................................................... ................. 157 12.2.2 Grand River Transit - GRT. .............................................................. , ............................ ................. 158 12.2.3 Hamilton Street Railway - HSR ...................................................................................................... 158 12.2.4 Conclusions .................................................................................................................................... 158

12.3 RECOMMENDED ORGANIZATIONAL STRUCTURE ...................................................................................... 158 12.3.1 Transportation Planning ................................................................................................................ 160 12.3.2 Transit Department ............ , ......................................... ................................................................... 161 12.3.3 Support Functions ..................... , .................. , ................................................................................. 161

13 THE BUSINESS CASE FOR REGIONAL TRANSIT IN DURHAM ...................................... 165

13.1 SUMMARIZING THE BUSINESS CASE.. ....................................................................................................... 165 13.2 OPPORTUNITIES FOR INNOVA TION/CoST SAVINGS ................................................................................... 168

13.2.1 Economies of Scale .......................................... , .......................................... ...... , ............................ 168 13.2.2 Staffing Rationalization ... ............................................................................................................... 168 13.2.3 Fares/Ridership .................... , ...................... ", . ........................ ,. . .......... , ............................ 168

13.3 RISK ANALYSIS AND MANAGEMENT.. ...................................................................................................... 169 13.3. J Labour Relations ..... , .... , ................................ , ...................................................... , ........................ J 69 J 3.3.2 Human Resources .......................................................................................................................... J 70 J3.3.3 Employee Communications ............................................ ' ...................... ' .................................. 170 J 3.3.4 Assets/Facilities Management .. ....................... , , ....................... , ................................................... 170

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Services to the Regional Mllnicipality of Dllrham October 2004

13.3.5 Finance - Regional Transit Fund ............................................................................................. ...... 170 13.3.6 Financial and Other Data .............................................................................................................. 171 13.3.7 Operating Costs ................................................................ .............................................................. 171 13.3.8 Regulatory Changes ....................................................................................................................... 171 13.3.9 GO Transit ..................................................... ................................................................................. 172 13.3.10 Environmental Impacts ................................................................................................................... 172 13.3.11 Technology Changes ...................................................................................................................... 173 13.3.12 Timing and Schedule Pressures ......................................................................................... ............. 173 13.3.13 Fleet Renewal/Replacement ........................................................................................................... 173

13.4 PARTD CONCLUSIONS ............................................................................................................................. 173 The follOWing risks have been identified with respect to the amalgamation of transit service in Durham Region: ............................................................................................................................................................. 174

14 STUDY RECOMMENDATIONS ................................................................................................. 176

Exhibit 2.1 Exhibit 12.1 Exhibit ILl Exhibit 12.2 Exhibit 12.3

Table 3.1 Table 3.2 Table 3.3 Table 3.4

Table 3.5 Table 3.6 Table 3.7 Table 3.8 Table 6.1 Table 7.1 Table 7.2 Table 7.3 Table 7.4 Table 8.1 Table 8.2 Table 9.1 Table 9.2 Table 9.3 Table 9.4 Table 10.1 Table 10.2 Table 10.3 Table 10.4 Table 10.5 Table 10.6 Table 10.7 Table 10.8 Table 10.9

EXHIBITS Transit Priority Network Regional Responsibilities for Transit Operational and Planning Procedures Transit Department Responsibilities Planning Department Responsibilities for Transit

TABLES Existing Asset Listing Net Operating Costs and Revenue of Conventional Transit in Durham Region Obligatory Reserve Funds for Transit Service Development Charges 2003 Actual vs. 2004 Budget Transit Taxes per Household Summary Comparison for APTA, Whitby, Oshawa and Clarington OOO's $ Durham Transit Capital Fund Financing and Expenditures, 2000-2003 Durham Transit Continuity of Reserves and Reserve Funds Current Transit Fares Costs of Specialized Transit in Durham Region Current and Suggested Service Standards - Conventional and Specialized Transit Services Forecasted Peak Period Travel Demands and Mode Shares Person Trips, AM Peak Period (1996) Person Trips, AM Peak Period (2021) Transit Trips, AM Peak (2021) Assessment of Transit Organizational Alternatives Comparison (Evaluation) of Service Delivery Options Recommended Service Standards for Regional Transit Present Transit Characteristics Comparison of other Municipal Jurisdictions Proposed Fare Harmonization Schedule Conventional Transit Operating Costs - Status Quo Conventional Transit Operating Costs - Regional Transit Conventional Transit Capital Costs - Status Quo Conventional Transit Capital Costs - Regional Transit Financing of Capital Investments Specialized Transit Operating Costs - Status Quo Specialized Transit Operating Costs - Regional Transit Specialized Transit Capital Costs - Status Quo Specialized Transit Capital Costs - Regional Transit

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Table 10.10

Table 10.11 Table 11.1 Table 11.2 Table 11.3 Table 11.4 Table 11.5 Table 11.6 Table 11.7 Table 11.8 Table 12.1 Table 12.2

Chart 3.1 Chart 3.2

Appendix A Appendix B

TABLES Overall Summary of Conventional and Specialized Transit Costs for Status Quo and Regional Transit Scenarios Transit Service Hours Estimated for 2006 Human Resources Sub-Committee Action Items Finance Sub-Committee Action Items Legal Sub-Committee Action Items CommunicationslMarketing Sub-Committee Action Items OperationslPlanning Sub-Committee Action Items Implementation Sub-Committee Action Items Summary of Perfonnance Measurement System - Conventional Service Summary of Perfonnance Measurement System - Specialized Service Transit Organization Data Existing Transit Arrangements

CHARTS Municipal Operating Contribution per Capita Revenue Vehicle Hours per Capita

APPENDICES Asset Listing Sale of Business Background Infonnation

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Business Case Analysis/or the Potential Tran~/er o(Lower-Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

EXECUTIVE SUMMARY

PART A: OVERVIEW OF CURRENT SERVICES AND POLICY FRAMEWORK

A.l BACKGROUND

The authority for operating public transit within the Region of Durham, other than GO Transit, currently rests with the lower tier municipalities. Four local operators provide conventional transit service within the Region:

• Ajax/Pickering Transit Authority (APT A); • Whitby Transit (contracted through Canada CoachlTrentway-Wager); • Oshawa Transit; and • Clarington Transit (contracted through Oshawa Transit).

Conventional services for inter-regional transit are provided by GO Transit, in the form of bus and heavy rail train service.

Specialized transit services are provided by Handi Transit Incorporated, Ajax/Pickering Transit Authority (APT A) and Brock Community Care.

On January 12, 2004, the Municipality of Clarington adopted a resolution to transfer full responsibility of transit services and capital to the Regional Municipality of Durham (the "Region").

On February 11,2004, Regional Council responded to the Clarington Resolution by approving the bylaw for accepting the transfer of transit services to the Region, satisfying the Regional or upper tier Council majority required as part of the "Triple Majority". The endorsement of the other area municipalities by a "Triple Majority" is a requirement under the Ontario Municipal Act, 2001.

At the March 24, 2004 deadline for responses, only the City of Pickering and the Municipality of Clarington passed Conditional Resolutions supporting the transfer of transit services to the Region. The Town of Whitby and the Town of Ajax opposed the transfer as proposed, while the Townships of Scugog, Brock and Uxbridge deferred the decision to transfer of transit services to the Region and requested that the Business Case Analysis was required to determine the viability, costs, benefits, and implications of a Regional transit system. The City of Oshawa did not respond prior to the March 24, 2004 deadline; however, the City's Strategic Initiatives Committee did respond after the deadline with an endorsement of a proposal to undertake a Business Case Analysis.

The purpose of the Durham Business Case Analysis summarized in this document was to assess whether the transfer of responsibility for the delivery of cOllvelltional alld specialized transit services to the Regioll from the area municipalities is ill the best interest of the residents of Durham Region.

A.2 STUDY APPROACH

This study was conducted using a systems approach, similar to an approach that might be used for a typical Environmental Assessment i.e. defining the problems and opportunities, rationalizing the need, identifying and evaluating alternatives to the undertaking and defining alternative methods to solving the defined problem. The work associated with the study was undertaken in four distinct, but interrelated phases:

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Business Case Analysisjor the Potential TransFer o/Lower-Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

A. Current Services and Policy Framework - Defining existing conditions, problems and opportunities and establishing a policy framework.

B. A Vision for Transit in Durham - Establishing a vision for transit and strategic goals. C. A New Approach to Transit - Defining the need for integrated transit and amalgamation. D. Investing in Regional Transit Services - Assessing the cost and implications of amalgamation.

A.2.t BUSINESS CASE ANALYSIS FRAMEWORK

In a conventional "for profit" business, a typical business case assessment involves using a "scorecard" and a set of universally accepted financial performance measures, such as net income and return on investment (ROI), to determine whether or not to proceed with an investment in a new venture. In the case of transit services, which are typically provided by the public sector, the standard approach to development of a business case using financial performance measures alone is not applicable.

From a full cost accounting perspective, neither the full costs nor benefits of transit are completely measurable. In addition, transit should be viewed as an important public service where the benefits of quality service go well beyond the measurement of costs and revenues. Transit services have historically required public subsidy to operate and will continue to do so until users of other means of transport, including the automobile, are required to pay the full costs associated with their travel.

A decision regarding amalgamation must be made on the basis of assessing whether or not the public will be better served in the longer term by moving towards amalgamated services. In order to make this determination, the work associated with this report has attempted to answer the following basic questions regarding both conventional and specialized service within the Region of Durham:

• What is the most appropriate delivery option to satisfy public growth in demand for public transit services and client needs?

• What is the best model to ensure that transit services are unimpeded by jurisdictional boundaries or intermodal barriers (i.e. the provision of integrated transit from both a system and fare perspective)?

• What is the best service delivery model to provide service to currently underserviced locations within the Region?

• What is the model that will best link decisions on transit to local, regional and Federal policy regarding transportation, planning and land use (growth management)?

• How should transit be provided to best facilitate the development of a livable, and environmentally, sustainable community?

• Which model will produce the greatest long-term economic benefits for the Region and local municipalities?

• Assuming that there are alternative service models that can address or respond to the above questions/objectives, what are the costs and revenues resulting from the implementation and operation of these models and can the net operating costs be sustained by the responsible agency/agencies?

In attempting to answer the above questions and by doing so respond to the overarching question regarding the business case for a Regional transit system, it is important to recognize that public policy­making is not an exact science and the recommendations from the study will reflect an interpretation of current policy and community standards and values. At the end of the day, the final decision to move to Regional transit will be a decision of public policy which balances public objectives such as community growth, environmental sustainability, and social equity against the cost to the public in the form of property taxes.

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Business Case Analysis/or the Potential Trans/er o/Lower-Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

A.2.2 CONSULTATION PROCESS

The Business Case Analysis involved consultation with local municipalities, transit operators and Regional staff. Gathering the opinions, issues and concern of each stakeholder group has proven invaluable input to the identification of servicing options, opportunities and constraints. As part of the consultation component of the study, meetings were held with representatives of the Ontario Ministry of Transportation (MTO), The Ministry of Public Infrastructure and Renewal (MPIR) and GO Transit. The purpose of these consultations was to make these Provincial bodies aware of the study, and determine what impact, if any, there might be to Regional transit as a result of existing Provincial Government programs and services, or potential Government transit initiatives.

A.3 CURRENT SERVICES AND POLICY FRAMEWORK

A number of key Regional and Provincial policy documents were reviewed in the context of establishing a policy framework for the Business Case Analysis. These documents included:

• The Region of Durham Official Plan (ROP), March 2004 consolidation - The Official Plan for the Regional Municipality of Durham (ROC) sets out the strategic objectives for growth and development within the Region with respect to land use, urban form, transportation and transit;

• Regional Community Strategic Plan (CSP) - The Region of Durham - 2003 - With respect to transit, the CSP sets as objectives the creation of a viable, affordable and integrated transit system, which will facilitate the movement of the Region's residents between communities within the Region and beyond, and reduce congestion on the Region's roads;

• Regional Transportation Master Plan (TMP) - The Region of Durham - 2003 - The Transportation Master Plan (TMP), adopted by Regional Council in 2003, defines in greater detail the elements of the transportation network, and recognize an efficient and effective public transportation network as critical to the long term economic, environmental and community sustainability for the Region. Through approval of the TMP, the Region of Durham has committed to achieve the highest trip diversion from the single automobile to other modes, that is reasonably practical, given current travel habits and the present focus on the automobile. The TMP recognized that the needs of the Region's rural communities for public transit were best met through the provision of demand responsive para­transit type services. The TMP also recognized that there was a need for specialized transportation services to meet the needs of the disabled. Handi Transit Inc, and APT A currently provide such services, and the TMP suggest that they be integrated to better serve the whole of Durham Region;

• Durham Transit Improvement Plan (TIP) - The Region of Durham (2003) - The Transit Improvement Plan (TIP) was prepared as a follow-up to the work associated with the TMP in a supportive and complimentary manner, the TIP considered both conventional and specialized transit on a Region-wide basis and identified potentially significant benefits that would accrue from further amalgamation of services within the Region. The TIP provided a range of recommendations relating to service enhancements to local, inter-municipality and inter-regional transit services. Harmonized specialized service standards were recommended between APT A and Handi Transit;

• Places to Grow/Infrastructure Financing Framework - Province of Ontario 2004 - The Province of Ontario, through the Ministry of Public Infrastructure Renewal (MPIR) recently released a Discussion Paper outlining the directions and actions to be taken within the Greater Golden Horseshoe (GGH) region to manage further growth. The document emphasizes the need for travel choices both within and between urban centres within the GGH and the need for fast, convenient and cost-effective public transportation. The document concludes that transit will be the first priority for investment, and that there will be co-ordination and integration of transit services across municipal·boundaries. There will also be standards and performance measures, e.g. transit ridership, put in place for all transit

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Business Case Analysis.tor the Potential Trans/er o/Lower- Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

operations within the GGH. The Province of Ontario has already used transit ridership as a mechanism for distributing portions of the recently announced Dedicated Gas Tax Funds For Public Transportation program.

A.3.t PUBLIC CONSULTATION

This study did not include a separate public consultation component; however, the Project Team did use and build upon information obtained from a public opinion survey conducted as part of the Durham TMP. This study revealed that the residents of Durham felt that there was a need for greater connectivity between the Region's municipalities, and approximately 85% of the respondents cOllSidered better inter­municipal transit was either essential or fairly important.

A.3.2 LESSONS LEARNED FROM OTHER JURISDICTIONS

The integration and amalgamation of transit services has occurred in a number of other jurisdictions over the last several years. As part of this study it was considered prudent to review the rationale behind the amalgamation of services in these areas, the processes that were followed, and the lessons learned. Some of the key areas considered with respect to previous transit service amalgamations in the Regions of Waterloo and York included:

• Service standards; • Financial opportunities and constraints; • Asset transfer strategies; • Consideration of management, organizational and government structures; • Human resources (HR) issues and strategies to address these issues; and • Implementation opportunities and strategies.

Certainly, one of the most important lessons learned from Regions of York and Waterloo amalgamation experiences was that the entire process is extremely complex and due diligence is required to understand all of the issues and nuances surrounding the issues of transit operations, financing, human resources, legal, asset transfer and asset valuation, etc. In both York and Waterloo, a number of issues remain outstanding - particularly in the area of human resources.

In both the York and Waterloo cases, the justification for amalgamating transit services was to build upon the pre-existing local services, provide transit amenities to currently underserviced areas and facilitate development of a mode of transportation that could ultimately compete with the automobile for some trips within the community. As of July 2004, ridership on the York Region transit system has increased by 46.2% over the same period in 2003. Much of the increase over the last year has been as a result of bus routes acquired from GO Transit in 2003, although approximately 12 % of the growth can be attributed to other routes within the system.

Both the York and Waterloo systems have realized a decrease in their revenue to capacity ratio (RIC), primarily as a result of added routes and increased services. Growth in ridership has not been accompanied by a commensurate increase in RIC ratios previously experienced by the local operators.

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Busilless Case Allalysisjor the Potential Transfer olLower-Tier Municipal Trallsit Services to the Regional Municipality of Durham October 2004

A.3.3 CONCLUSIONS

An examination of the key public documents revealed a number of themes regarding the provision of transit in urban, suburban and rural communities.

• The benefits of transit go well beyond health and environmental considerations. In fact, transit has a wealth of economic benefits;

• Transit has more "value" to the community than the individual components of the network; • Transit cannot be valued simply by the components of the network and is also more than the ratio

of the cost to provide the service relative to the revenues generated from its operation; • Transit is more effective when operated as part of an integrated network that provides choice for

users; • Federal and Provincial government policy statements place a high priority on the importance of

public transit. New investment models are being explored by both levels of government; • A viable and integrated public transit system will be one of the keys to reducing auto dependency in

the future and achieving more compact forms of urban development; • More attractive service and integrated market share for transit are essential elements to increasing

ridership; • The intrinsic benefits of public transit although difficult to quantify, should be considered in the

context of the evaluation of any new services; and • The Business Case for public transit must not only include an assessment of costs and revenues but

must be linked to other issues and benefits such as community wellness.

The following lessolls were learned from past experiences of similar jurisdictions regarding the integration of transit:

• Adoption of the "Cumming Principle" (i.e. the community does not pay twice for assets) for the potential transfer of transit assets;

• Proactive development of a Human Resources Implementation Plan to deal with employee/labour issues associated with the integration of transit; and

• Development of a Communications Plan to effectively disseminate information to transit employees and the public regarding the transitionlimplementation process.

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Business Case Analysis/or the Potential Transfer o/Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

PART B: VISION FOR TRANSIT IN DURHAM

B.l TRANSIT VISION AND OBJECTIVES

This component of the study resulted in the definition of transportation and transit visions for the Region and a supporting list of goals and objectives as they relate to the provision of future transit services within Durham. In addition, work associated with Part B of the study resulted in the development of service standards for future transit service in Durham to be adopted, and should be implemented whether or not transit is provided at the local or Regional level.

The policy review conducted within Part A of the Business Case Analysis revealed that transit is now recognized across the Province as a transportation cornerstone required to accommodate increasing travel demands in an environmentally responsible way. In response to policies and themes articulated in Regional and Provincial policy documents, the transportation vision for the Region as adopted by the Council of the Region of Durham, is embodied in the Region's Transportation Master Plan, and is further articulated as follows:

By the year 2001, the transportation s,vstem for the Region of Durham is integrated and balanced, using a range of transportation strategies to address the mobility and goods movement requirements of the entire community, to sustain investment in industry, agriculture and tourism, to maintain community '''vel/ness'', and to integrate with the environment.

The auto continues to be the dominant mode of transportation; however, the community has realized a shift toward greater use of transit, pedestrian and cyclingfacilities.

The changes in modal usage have been accomplished by increased urban densities, mixed use development, policies that encourage reduced auto use, higher order transit facilities linking centres within Durham and other urbanized areas in the GTA and improved integration of the various modes of transportation.

The necessary funding available from al/ levels of government has been put in place and all possible opportunities for private sector funding to achieve the improvements necessary to ensure a livable community have been investigated.

The transit vision for the Region reflects the overall transportation vision for the Region and embodies the concept of sustainable growth. It also reflects community sentiment regarding transit as articulated through the TMP public survey. The vision is also consistent with the principles and objectives contained in the draft Places to Grow document, recently released by the Province of Ontario.

The transit vision is as follows:

By the year 2021, the transportation system in Durham includes an integrated transit network that provides a safe and competitive alternative to the automobile for travel within and through the Region of Durham. The transit infrastructure affords seamless linkages' to all areas within the Region and connections to other communities and systems. Transit service is unimpeded by jurisdictional boundaries or intermodal barriers. The service is frequent on key routes and competitive travel times for inter and intra-municipal travel encourage reduced use of auto travel, particularly in the urban areas. The cost of travel by transit is also competitive with automobile travel for similar trips.

Transit in Durham is characterized by a network and vehicles that offer access to transit services for all sectors of the community including those requiring the use of specialized services.

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Business Case Analysis./or the Potential Trans/er a/Lawer-Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

The system is affordable and reliable, is client and customer focused and is managed efficiently and cost­effectively. Transit is considered explicitly in the planning, design and implementation of new commercial and residential developments, subdivisions, roads and other municipal, Provincial and Federal infrastructure. Planning for transportation infrastructure, whether new facilities or rehabilitation/widening of existing facilities, recognizes the unique needs of the transit component of the travel market while ensuring that facility design and operation does not affect the cost and travel times for goods movement.

Transportation service for the disabled meets the requirements of the Ontario Disabilities Act and is seamless, customer-focused and cost-effective for the users and operators. SpeCialized services are flexible to adapt to changes in demand recognizing the aging population within the Region and unique travel demands of this group. The frequency and level of service provided for specialized transit services are comparable to that of conventional transit as are the fares for patrons.

The necessary funding available from all levels of government has been put in place to maintain and operate the system in accordance with desired service standards and all possible opportunities for private sector funding to achieve the improvements necessary to ensure a livable community have been investigated.

Managing, improving and expanding the system to satisfy public demand has become a priority for the community. Decisions on investment in transit service and infrastructure expansion are made on the basis of maintaining community wellness, environmental sustainability and are aimed at achieving a reduction in the levels of ownership and use of the private automobile within the Region.

Five strategic goals for transit in the Region of Durham have been established to support the vision and reflect a renewed emphasis on public transit emanating from regional, Provincial and Federal policy documents.

• Goal A • Goal B • Goal C • Goal D • Goal E

Provide an integrated transit network; Provide access for all areas and sectors of the community; Develop a system that is affordable and efficient; Facilitate the development of a livable and environmentally sustainable community; and Satisfy public demand and client needs.

In order for Durham to realize its transit vision and achieve the goals established for the community, there will have to be a change in institutional structure and paradigms regarding the planning, funding and operation of transit services. The Region of Durham Community Strategic Plan provides visionary direction relative to transit. The plan, along with the vision articulated in this document, requires sustained support and innovative leadership to be effective and produce long term economic and environmental benefits.

The net operating costs of transit services are currently funded by the local municipalities from property tax revenues obtained from their constituents. Travel demand is not, however, dictated by municipal boundaries. As a consequence, effectively matching the supply and demand for transit within Durham is a challenge often artificially constrained by jurisdictional responsibilities that may preclude a community investing in resources that could be preserved to serve the residents of an adjacent municipality.

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Business Case Analysisfor the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality o/Durham October 2004

B.2 TRANSIT POLICIES AND STANDARDS

To provide a basic level of mobility within the Region, and to permit monitoring of route and system performance, it is important that a set of transit service standards be established for integrated transit service. These standards are desirable targets and will require a considerable time period to achieve. The rate of progress towards achieving the targets will be dependent upon costs and revenues, senior government funding, the status of the Regional Transit Fund, tax rates and formulae, etc. It should also be noted that there might be circumstances where decisions are made to implement routes or adjust service levels that do not meet the recommended service standards. The recommended service standards are described in Chapter 6 of the main body of this report

B.3 CONCLUSIONS

In order for Durham to realize its transit vision and achieve the goals established for the community, there will have to be a change in societal attitudes and also changes to institutional stnlctures and paradigms regarding the planlling, funding alld operation of transit services.

With lack of funding being the major impediment in many cases to expansion of transit services in a meaningful way, the municipalities within Durham must co-operate to position themselves to change or influence the way transit is funded by the Provincial and Federal governments and to ensure that Durham achieves its fair share of dedicated sustained transit funding.

Initial service standards have been selected to facilitate development of an integrated system. Only minor adjustments to APT A, Whitby Transit and OTC are required. The standards may be adopted for an initial period of integration, but should be regularly reviewed and adjusted as necessary to ensure that they remain both financially feasible, technically defensible and be subject to ongoing review during the initial stages of implementation when it may also be appropriate to adjust/modify these standards and add additional standards.

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Business Case Analysis/or the Potential Trans/er a/Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

PART C: A NEW APPROACH TO TRANSIT

C.l NEED AND RATIONALE FOR INTEGRATED TRANSIT IN DURHAM

The transit vision for the Region suggested that, by the year 2021, the transportation system in Durham will be comprised of an integrated transit network that provides a safe and competitive alternative to the automobile for travel within and through the Region of Durham. The key to this statement and the vision is the term "integrated". Today there is some service and fare integration between and among local operators and GO Transit, although it is still difficult, from both a physical and fare perspective, for residents to travel seamlessly between adjacent municipalities. Work associated with Part C of the study involved the assessment of the need and rationale for integrated transit services in Durham.

The future of public transit in Durham over the next two decades and beyond, lies in improved service levels, enhanced inter and intra-regional linkages leading to increased transit patronage and eventually higher order transit service for conventional services. With respect to specialized services, the future involves seamless travel for patrons of specialized service across the Region operating in a closer inter­relationship with conventional transit.

For the purpose of this study, integrated transit was defined as a transit network/system that affords, seamless (fares/transfers) linkages to all areas within the Region and provides connections to other communities and systems. Transit service in an integrated system is unimpeded by jurisdictional boundaries or intermodal barriers.

In an environment such as Durham's, travel is often characterized by many inter-municipal and inter­regional trips. The current conventional transit services provided by the local municipalities within the urban areas are challenged to accommodate overall demand. In this regard, the existing services as a competitor to the auto, may be unsustainable as operated by the local municipalities, given their focus on revenue to cost ratios, managing assets and maximizing efficiencies in the implementation of those assets over local geographic areas. The current transit operators are facing increasing costs and declining market shares and the current service plans and government structures make it difficult to respond to emerging travel demands and customer expectations.

A number of municipalities within Durham are experiencing financial challenges that may well affect long term sustainable investment in transit. Each of the local operators have identified the need to acquire a number of new vehicles to replace an aging fleet. The vehicle replacement plan articulated by the local operators is not viable without significant increases in taxes or Provincial or Federal funding, given historic spending on transit by the area municipalities/local operators.

The Region of Durham is committed to achieve the highest diversion of single occupant automobile travel to other modes that is reasonably practical, given current travel habitats and the present transportation system focus of serving the automobile. The plan sets a target of reducing afternoon peak period automobile driver trips by 15% compared to forecasts based on current trends. In achieving this 15% target by the year 2021, it is assumed that most drivers will divert to transit. III order to achieve this 15% target, trallsit use ill the Region will have to increase by approximately 450% by 2021. Data collected for this study shows there is a high level of demand for travel between the municipalities and along the lakeshore corridor in particular. There is also some travel demand between the rural areas and the urban areas, particularly in Oshawa. Such demand will currently go unsatisfied with the current transit organizational structure.

There is also increasing demand for specialized transit services in the Region. With an aging popUlation and health care facilities spread across the Region, improved specialized transit services are essential to community well being.

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Business Case Analysis/or the Potential Trans/er a/Lower-Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

The study has identified a myriad of benefits (Section 7.2 of the main body of the document) that can be attributed to the provision of integrated conventional and specialized transit services within the Region of Durham. These benefits provide a powerful rationale for investing in the integration of conventional and specialized transit systems in Durham. The following is recommended regarding the need for integrated transit:

1. A higher level of integration of conventional services across the Region for fares and services should be pursued;

2. The integration of specialized service across the Region should be pursued. In addition to service integration, fares for these specialized services should also be fixed at levels compatible with conventional service;

3. That an organizational management structure be established to facilitate improved co-ordination of service between conventional and specialized transit.

C.2 DELIVERING INTEGRATED TRANSIT FOR DURHAM

In terms of delivering integrated transit to the residents of the Region of Durham, a number of service delivery options were reviewed in the context of this study. These options included:

• Status Quo - Maintaining current operators for both conventional and specialized service; • Enhanced Status Quo - A similar scenario to the status quo with the exception of the amalgamation

of Whitby, Oshawa and Clarington services into a single service provider. Fare and service integration between Oshawa-Whitby-Clarington is underway and would be fairly uncomplicated to implement; and

• Full Amalgamation - Full amalgamation can be defined as conventional and specialized transit being incorporated into a regional organizational structure.

Funding for the first two scenarios would be through municipal transit tax as supplemented by the Regional Transit Fund and Provincial/Federal funding programs. Funding for the amalgamation scenario would be raised through a combination of the Regional Transit Fund, additional Regional tax levies and supplemented by Provincial/Federal funding programs.

The evaluation of delivery options was undertaken using the five key goals for transit service as established in Part B of the study. Table E-l below illustrates the evaluation of service delivery options as summarized using a standard balance sheet scoring method.

TABLE E-2 COMPARISON (EVALUATION] OF SERVICE DELIVERY OPTIONS

FACTOR/CRITERIA STATUS QUO

PRO\ IDL \ '\ 1'\ 1 U;R \II- J) J R \'\SII '\ 1· 1 \\ ORK

Potential to increase inter-municipal ridership

Potential to increase inter-regional • ridership

Potential to increase local ridership

t

ENHANCED STATUS QUO

• -

t .,j

AMALGAMATION

e e e

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Business Case Analysis/or the Potential Trans/er o/Lower- Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

TABLE E-2 COMPARISON ~EVALUATION) OF SERVICE DELIVERY OPTIONS

ENHANCED FACTOR/CRITERIA STATUS QUO

STATUS QUO AMALGAMATION

Increase convenience to Durham • ) Residents -

Facilitate higher order transit service • in the future (BRT, LRT) -

Enhance integration with GO Transit • • Potential to achieve uniformity of • t standards -

PRO\ tnt \( ( 1 SS H)J{ \LJ \RI· \S ~~ SH 1 OI{S 01 IJIf ( 0\1\11 '\11 \

Potential to develop conventional services in rural areas

Seamless travel for patrons of specialized service • Dl \ H OP \ S\ S I UI I II \ I IS HI OIW \BU & I III( n'\ I

Facilitate more balanced investment in transportation infrastructure (road congestion)

Economic Benefits • Ability to compete with the auto for • some trips,

Ability to achieve fare integration across the Region -

Ability to attract sustainable upper-tier government subsidies

Ease of implementation e HR and labour impacts e

•

• • _.

• • -

" )

., ., ., e

)

" ., e

" t •

F\C1L11 \11 11-11-" In.\ tLOP\H '\ I 01 \ I 1\ \BLr & .. '\\ lHO'\;\H.'\ 1 \1 1 Y Sl S'I \1'\ \BLE CO\l!\1l ,\11 \

Environmental benefits • Page xi

Business Case Analysis jor the Potential Transfer o/Lower-Tier Municipal Transit Services to the Regional Municipality a/Durham October 2004

TABLE E-2 COMPARISON (EVALUATION) OF SERVICE DELIVERY OPTIONS

ENHANCED FACTOR/CRITERIA STATUS QUO

STATVSQVO AMALGAMA TION

Achieve Regional mode share • e objectives (TMP)

Community and social benefits • " Facilitate transit supportive growth • " patterns (development aspirations)

Consistency with Provincial growth • e management policies/strategies

Ability to contribute to reduced • " levels of traffic congestion

SUISI·\ Pl BI.I( 1>1-\1 \,\1>& CI" 'IS '\11 ns

Ability to improve • • e marketing/information -

Monitoring/ Accountability • • " Improve accessibility to transit • -

" -

Provide mobility choice • " Improve service levels • " Satisfy demand for school trips t t e - • "

Achieve equity in service provision

0 Poor • Excellent

An integrated transit system has been demonstrated to be necessary in order for the Region of Durham and the local municipalities to achieve the visions articulated in regional and Provincial policy documents The evaluation of service delivery options indicates that the preferred approach is to amalgamate all local conventional and specialized services into a regional structure funded and operated under the jurisdiction of the Region of Durham.

An amalgamated transit entity funded and operated by the Region of Durham has the highest potential to:

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Business Case Analysis/or the Potential Tran~/er o./Lower-Tier Municipal Transit Services to the Regional Municipality o./'Durham October 2004

• Achieve an integrated network characterized by higher levels of inter-municipal and inter-regional travel and overall increased ridership including seamless linkages on Highways 2 and 12, Taunton Road and Bayly StreetNictoria Street;

• Provide conventional transit service for underserviced municipalities; • Result in expanded operations and seamless travel for specialized service patrons; • Facilitate more balanced investment in transportation infrastructure; • Achieve spin-off economic benefits to the community; • Attract sustainable and increased levels of Provincial/Federal government subsidies; • Result in a livable and environmentally sustainable community; • Achieve equity in service provision; and • Achieve public satisfaction and meet client needs.

C.3 CONCLUSIONS

While it is acknowledged that public policy-making is not an exact science and there are clear arguments in favour of providing transit at both a local level and a regional level, on balance, and based on the assessment conducted as part of this study, it is clear that from a qualitative perspective that there are significant reasons why amalgamation of transit services is an appropriate initiative for Durham Region at this time.

Both conventional and specialized services, with the exception of the services provided by Brock Community Care, should be amalgamated under Regionaljurisdiction.

It appears from recent initiatives across the GGH and from examination of other transit operations across Canada, that if transit services were being initiated for the first time in the Region, such services would likely 'be delivered on a broad basis, as opposed to being provided by the local municipalities. In Durham Region this is most likely the case as the municipalities, although separated by artificial political boundaries, are merged as a result of development, other infrastructure such as roads and water and sewer, etc. In addition, and perhaps most importantly, the public users of any transportation service, be it roads or transit, do not care about political boundaries and are only interested in seamless and cost­effective travel.

From both a Provincial and Federal perspective, it is clear that transit will be the first priority for infrastructure investment. It is also apparent from recently released policy documents that new investments in transit are being considered by both levels of government.

Consideration of an integrated transit network in Durham, characterized by both higher levels of inter­municipal and inter-regional connectivity and service, is consistent with existing public policy and public sentiment.

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Business Case Analysisjor the Potential Tralls./er ~/Lower-Tier Municipal Transit Services to the Regional Municipality of'Durham October 2004

PART D: INVESTING IN REGIONAL TRANSIT SERVICES

Part C of the report culminated in a recommendation that transit service be amalgamated and formally transferred to the Region. In order to understand the financial implications of such a transfer to complement the qualitative component of the Business Case Analysis, a preliminary transit service plan was developed. Consistent with the objectives of developing an integrated transit system for both conventional and specialized transit services within the Region of Durham, a preliminary transit service plan was developed to achieve the following:

• Improve transit linkages in an east-west and north-south direction across the region; • Improve quality of service in the urban areas moving towards the achievement of recommended

service standards; • Improve quality of service for specialized transit service in both the urban and rural areas; • Initiate transit service in the rural areas; • Attract new users to transit and encourage current patrons to use the system more frequently; and • Increase transit mode share of intra-regional (inter-municipal) and inter-regional travel.

A further objective of the service plan was to advance the philosophy that transit should be equally available to all sectors of society at a similar cost.

D.I SERVICE OPERATIONAL PLAN

D.1.1 SERVICE PLAN APPROACH

The preliminary service plan recognizes that the current municipal transit systems do not achieve proposed service standards (Chapter 5 of this document) or fully address the internal and inter-regional travel needs of the residents of Durham, both for conventional and specialized patrons. For the purpose of this study, a preliminary service plan was developed for the next 5 years (2006-2010) and for 2014 (year 10). The plan was based upon January 1,2006 as the effective date of transfer of municipal services to the Region.

The approach used in developing the model for regionalization of transit service delivery included the following basic steps:

1. Establishment of an urban transit service area within which recommended service standards for regional transit would be applied. In the rural areas, the establishment of service would be based upon a more qualitative assessment of service need and opportunities.

2. Application of common service standards and financial policies.

3. Recognition of Highway 2 as the principle bus transit corridor in Durham Region. The analysis conducted as part of this report has demonstrated that the full integration of local municipal services with the GO transit operations within the Highway 2 corridor has the potential to optimize the net cost of transit service required to achieve the Region's objectives to significantly increase the use of public transit. Accordingly, an integrated concept for Highway 2 service is recommended to form the basis for the development of the 5-year service plan for the extension of service.

4. Consideration of enhanced level of service targets for local service. Research undertaken as part . of this study indicates that similar sized municipalities, including York, Waterloo and Hamilton currently "spend" $32.90, $41.00 and $56.15 per capita respectively. In the Region of Durham when the operations of the current service providers are combined, there is a total funding per

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Business Case Analysis/or the Potential TransFer o/Lower-Tier Municipal Transit Services to the Regional Municipality a/Durham . October 2004

capita of $26.40_ This is significantly below the funding levels for York, Waterloo and Hamilton. The work undertaken as part of this study suggested that the level of service achieved within the community, and in particular, the urban area should increase by 30% over the 5-year period to 0.85 vehicle hours per capita, and 60% over the 10-year planning period to 1.1 vehicle hours per capita. In addition per capita funding should, if financially feasible be increased by 50% over the next 5 years to a level of $40.00 per capita by 2009 and $50.00 per capita by 2014.

5. Establishment of an integrated Region/GO Transit fare system for bus service on Highways 2 and 12. A fare integration and subvention strategy has been reviewed in principle with GO Transit for service within Durham on Highways 2 and 12. This program compliments the current co­fare agreements -for connections to GO Rail now in place across the Region and when implemented, would replace the D-Pass program introduced on a 2-year trial basis in 2003. The fare agreement would require patrons traveling locally within the Region to pay either a regular single ride fare ($2.00 adult fare) or use a Regional Transit Pass, with the difference in fare between the regular GO fare and the local Durham fare to be paid as a subvention payment by the Region of Durham to GO Transit. A similar arrangement currently exists between GO Transit and the Town of Whitby, for trips on the Highway 2 GO bus service between Whitby and Ajax.

The purpose of this initiative is to provide immediate opportunities for Durham residents to make local or inter-municipal trips within Durham on a single fare and to increase ridership on Highway 2 and Highway 12. This strategy will allow GO to enhance service on Highway 2 tothe point where separate "limited stop" and local service could be eventually implemented on Highway 2. This proposed arrangement with GO Transit will permit the provision of high quality east-west inter-municipal and local service on Highway 2 and Highway 12 at the cost of a single adult fare within the region. Not only would the cost be significantly reduced over existing levels but the customer comprehension and ease of use would be significantly improved. This fare subvention strategy with GO Transit is more cost-effective than provision of duplicate local service by Durham Region or the local municipalities. In essence, the Region is only paying for seats on buses that are used and is not covering the total cost of vehicles and drivers.

This local fare would be applied to any trips taken on a Highway 2 or 12 GO Bus operating within the Region of Durham. However, trips destined beyond Durham boundaries (e.g. Toronto) would be subject to the GO fare by distance policy currently in effect.

The proposed fare integration plan requires an agreement between GO Transit and the Region of Durham, and resolution of an acceptable process to accurately determine ridership and fare subvention payments, with appropriate audit controls.

There were a number of basic assumptions that were considered in the context of the development of a preliminary service plan for integrated transit in the Region of Durham.

• Fare harmonization across the Region for conventional service. Table E-2 details the recommended fare structure for a regional transit system reflecting harmonization of fares. This fare structure should be reviewed prior to implementation in 2006 and adjusted if necessary based on appropriate economic considerations and criteria;

• In order to harmonize fares between specialized and transit services it is recommended that all trips on specialized transit within an amalgamated environment be fixed at $2.00; and

• Current service within the local municipalities (GO and school service) will remain unaffected initially, or will be improved as a result of the transition to regional transit service. The plans are based on those provided by local municipalities and Handi Transit.

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Business Case Analysis for the Potential Transfer olLower-Tier Municipal Transit Services to the Regional Municipality olDurham October 2004

TABLE E-2 PROPOSED FARE HARMONIZATION SCHEDULE (2004 DOLLARS)

Whitby Oshawa Clarington Ajax/Pickering Recommended CASH FARES Adults $ 2.00 $ 2.00 $ 2.00 $ 1.95 $ 2.00 Student (Full-Time) $ 1.75 $ 1.75 $ 1.75 $ 1.60 $ 1.75 Seniors (65 or 55) Years & Age 60 + $ 1.25 Senior Centre Activity $ 1.25 $ 1.25 $ 1.25 $ 0.90 Card) Children (5 Years and Older $ 1.25 $ 1.25 $ 1.25 $ l.l5 $ 1.25 Attending Elementary School) Children [Under 5 Years Free NI A ($1.25) I N/A ($1.25) Free Free Accompanied by a Fare-Pa:ring Adult (Max. 3)1 GO Transit Fare Connection $ 0.50 $0.50 $ 0.50 $ 0.50 $ 0.50 MONTHLY PASSES Adult $69.00 $70.00 $70.00 $65.00 $70.00 Students (Unlimited Use) $60.00 $62.00 $62.00 $55.00 $60.00 Students (Restricted to $50.00 N/A- $50.00 $45.00 $50.00 School Days Only) Seniors $40.00 $42.00 $42.00 $20.00 $20.00 Children $40.00 $42.00 $42.00 N/A $42.00 GO Train Co-Fare $20.00 $20.00 $20.00 $20.00 $20.00 TICKETS Adults (Sheet of 10) $20.00 $19.00 $19.00 $19.00 $19.00 Students (Sheet of 10) $17.50 $16.75 $16.75 $16.00 $17.50 Seniors (Sheet of 10) N/A $11.85 $11.85 $ 9.00 $12.00 Children (Sheet of 10) N/A $1 1.85 $11.85 12 @ $13.20 10@ $12.00 Notes: N/A - Not Applicable 1 Child is defined as toddlers to Grade 8. 2 School Board(s) purchase passes directly from OTe. Pass not available for purchase by general public. OTe currently offers bulk discounted price of $38.50 to school board.

D.1.2 CONVENTIONAL SERVICE

The following presents an overview of conventional and specialized transit service improvements considered in the context of this study. The service plans provided below are preliminary in nature. Detailed plans will have to be developed during the period of transfer of services from the local municipalities to the Region.

Conventional Service Plan - 2005 Transition Period • Durham College/UOIT service continuation. This represents the second year of a two-year pilot

program; • Durham D-Pass continuation, again as the second year of a two-year pilot program.

Conventional Service Plan - 2006 Introduction of Regional Transit • Introduce fare agreement with GO Transit for Highways 2 and 12. It is also recommended that the

Region of Durham approach GO Transit to facilitate a fare subvention agreement on Highway 47 (Stouffville Train-Meet Service). This would allow residents of Uxbridge to travel more economically within Durham and is consistent with recommended fare harmonization. This linkage

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Business Case Analysis/or the Potential Transfer a/Lower-Tier Municipal Transit Services to the Regional J'vlunicipality o/Durham October 2004

would provide a better connection between the Region of Durham and the Durham-York boundary and potentially provide new opportunities for increased transit usage in the northern municipalities.

• Integration of fares within Durham for conventional and specialized service; • Route and frequency changes to achieve recommended service standards; • Extension of conventional service to the growing communities of Brooklin and South Courtice; and • Dial-a-Ride/Charter service to introduce transit service to Scugog, Uxbridge and Brock.

Conventional Service Plan - 2007 • Route and frequency changes to achieve recommended service standards; and • New inter-municipal service on BaylylVictoria/Bloor between Pickering and Oshawa. This route

was identified in the TMP and TIP as an important east-west transit corridor serving the southern lakeshore communities.

Conventional Service Plan - 2008 • Route and frequency changes to achieve recommended service standards; and • Taunton Road/Rossland Beltline service extension to Brock Road in Pickering.

Conventional Service Plan - 2009 • Route and frequency changes to achieve recommended service standards; and • Taunton Road extension to Bowmanville in Clarington.

Conventional Service Plan - 2010 • Route and frequency changes to achieve recommended service standards.

D.1.3 SPECIALIZED TRANSIT

Specialized transit, when transferred to the Region, will require the integration of the services currently provided by Handi Transit and APT A. Service will be coordinated across the region with a centralized, common booking and scheduling system. Fares will be harmonized with conventional transit for trips within the area. It is recognized (TIP Study) that the Ontarians with Disabilities Act will impose added obligations on the Region to provide equity of service for all residents. The TIP study also identified the changing demographic profile in Durham that suggests an aging population with increasing demands for specialized services in future years.

Enhanced service will be introduced gradually as shown in the plans that follow. Initially the fare integration will provide a significant benefit to specialized transit users. The centralized booking and dispatch and improved cross-region service capabilities will also enhance service. Planned acquisition of new vehicles by the area municipalities will increase the capacity of the system to respond to trip requests. The gradual conversion of the conventional fleet to low-floor accessible buses will reduce the pressure for delivery of specialized services for some users.

Reciprocity agreements with TTC Wheel Trans and Mobility Plus in York Region will be reviewed and strengthened under the new Regional system

Specialized Service Plall- 2005 • Improved service in Oshawa and Clarington as a result of the acquisition of new specialized vehicles

in 2004/05 (improved availability of new bus, shortened requirements for advanced booking);

Specialized Service Plall - 2006 • Fare integration/harmonization with Conventional Transit.

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Business Case Analysis/or the Potential Transfer o/Lower-Tier Municipal Transit Services to the Regional Municipality olDurham October 2004

Specialized Service Plan - 2007,2008,2009,2010 . • Scugog - Improved level of services as a result of the acquisition of a new vehicle (2007); • Whitby - Improved level of service as a result of the acquisition of a new vehicle (2008); and • Clarington - Improved level of service as a result of the acquisition of a new vehicle (2008).

10 Year Outlook

For the 10th year of Regional service no major service expansion is suggested and the strategy is focused on service standard harmonization.

D.2 THE COST OF REGIONAL TRANSIT

In order to assess the potential costs associated with the transfer of local transit services to the Region, an assessment was performed of the necessary investments for conventional and specialized transit service in terms of both operating and capital costs. The analysis was developed on the basis of a range of transitionlimplementation schedules. For the purpose of this analysis, January 1,2006 was assumed as a start date for amalgamation of service on the basis of issues and arguments detailed in Chapter 12 of the main report. The cost estimates were detailed annually for a 1 to 5 year period and also for a year 10 -2014 horizon. Assumptions relating to these plans are described in detail in Chapter 10 of this document. As a benchmark for comparison, a status quo option was also examined. The status quo is described as a continuance of local transit service in "a business as usual" approach with additional costs associated with planned fleet expansion and other costs relating to the Durham D-pass, UOlT student pass programs and other TIP programs previously budgeted for.

As noted, the analysis assumed that the regionalization of transit would occur on January 1, 2006. The costing of the Regional transit scenario included identification of base net operating costs from the status quo with adjustments to reflect the removal of costs associated with the DTIP program. Added to the base costs were costs relating to amalgamation and transition/implementation, the details of which are contained in Section 10.1.2. In addition, the cost associated with the provision of transit service enhancements including the GO fare subvention agreement and Region-wide transit planning monitoring, etc. have also been included. Table E-3 provides a summary of operating and capital costs associated with the status quo and Regional transit scenarios for the period 2004 to 2010 and also 2014.

As can be noted from Table E-3 the difference between the operating costs associated with status quo for the initial year of Regional transit service 2006, is approximately $3.5 million. The increase in costs generally relate to one time costs associated with regionalization, additional ongoing costs relating to the hiring of new Regional staff, the transfer of indirect costs (staff) to the Region, and human resources adjustment costs. Further adjustments involve transit service enhancement costs including potential GO Transit fare subvention charges and service expansion. The introduction of an aggressive fleet expansion and replacement programs accounts for the capital cost difference of about $3.2 million. The potential exists to scale back on the level of fleet replacement/expansion if deemed necessary as a result of further analysis.

With some consideration for the expansion of existing services it has been shown that the "unit" cost of providing such services under either a status-quo or amalgamation scenario would not be significantly different; however, this does not take into account the fact that the status-quo or partial amalgamation scenarios could not achieve the expanded services based on known funding constraints at the local levels. In fact, some of the major cost increases associated with amalgamation (labour costs for example) could be experienced by several ofthe local municipalities over a period oftime, even if amalgamation does not occur. It also appears that the municipal plans for vehicle acquisition and other capital initiatives are potentially not sustainable from a debt or debt servicing perspective, given historic expenditure expenence.

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Business Case Analysis/or the Potential Transler o/Lower- Tier Municipal Transit Services to the Regional Municipality olDurham October 2004

Neither the status quo nor amalgamation options meet the real test of a true business case - provision of a reasonable rate of return. In fact, it is clear that transit services will likely always require public subsidy and will not achieve an RIC of 100%.

The benefits of transit are in many respects non-quantifiable or can be measured in terms of spin-off of indirect economic benefits. In the case of amalgamated Regional transit in Durham, the environmental, social and economic benefits that may accrue to the community as a result of reduced auto use are thought to far outweigh the public subsidies required to operate the system.

The work undertaken as part of this study, and the work completed by Regional staff in determining potential transit tax rates by municipality, assume the injection of capital from the Gas Tax fund and the continuation of the Regional Transit Fund (at a level of $8.4 M in 2004 dollars). Any reduction in this fund due to increased requirements of GO Transit (GO Transit Capital Program), and without added Provincial/Federal government funding will require the Regional tax for transit at a local level to be increased to maintain the levels of service anticipated by this report.

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Business Case AJ/a~l'sis/iJrlhe Polenlilll Trall.l'/i'r 0/ !.i'\!'"r-Tier Municipal Tr{//B'it Services 10 Ihe Regional A1uJ/icipali~1' o/Durham Oclober 2004

Table E-3 - Overall Summary of Conventional and Specialized Transit Costs for Status Quo and Regional Transit Scenarios

Status Quo Summary

Year 2004 2005 2006 2007 2008 2009 2010

Operating Costs

Conventional Transit $15,049,000 $18,613,400 $19,690,480 $20,351,660 $20,770,840 $21,184,020 $21,680,201

Specialized Transit $1,623,000 $1,804,000 $1,984,000 $1,994,000 $2,004,000 $2,184,000 $2,194,000

Total $16,672,000 $20,417,400 $21,674,480 $22,345,660 $22,774,840 $23,368,020 $23,874,201

Capital Costs

Conventional Transit $8,176,000 $11,808,850 $9,930,850 $6,087,850 $9,484,850 $7,568,850 $7,593,850

Specialized Transit $618,000 $159,000 $156,000 $356,000 $499,000 $0 $500,000

Total $8,794,000 $11,967,850 $10,086,850 $6,443,850 $9,983,850 $7,568,850 $8,093,850

Overall Total $25,466,000 $32,385,250 $31,761,330 $28,789,510 $32,758,690 $30,936,870 $31,968,051

R 0 IT °t S eglOna ransl ummary

Year 2004 2005 2006 2007 2008 2009 2010

Operating Costs

Conventional Transit $1,400,000 $2,770,000 $22,687,000 $23,623,000 $24,828,000 $24,036,000 $23,903,000

Specialized Transit $0 $160,000 $2,440,300 $2,450,300 $2,460,300 $2,680,300 $2,680,301

Total $1,400,000 $2,930,000 $25,127,300 $26,073,300 $27,288,300 $26,716,300 $26,583,301

Capital Costs

Conventional Transit $0 $573,000 $13,063,000 $12,366,000 $12,878,000 $21,952,000 $21,730,000

Specialized Transit $618,000 $78,000 $256,000 $241,000 $414,000 $15,000 $15,000

Total $618,000 $651,000 $13,319,000 $12,607,000 $13,292,000 $21,967,000 $21,745,000

Overall Total $2,018,000 $3,581,000 $38,446,300 $38,680,300 $40,580,300 $48,683,300 $48,328,301

2014

$21,819,200

$2,224,000

$24,043,200

$2,067,000

$200,000

$2,267,000

$26,310,200

2014

$24,296,000

$2,680,300

$26,976,300

$10,545,000

$0

$10,545,000

$37,521,300

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Business Case Analysisjor the Potential Transfer of Lowe I'-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

D.3 TRANSFERING AND OPERATING REGIONAL TRANSIT

The basic Regional transit concept would involve, but may not be limited to the following:

• Retention and expansion of existing services; • Continued co-operation with GO Transit to facilitate intra-municipal service on Highway 2 and

Highway 12, through the application of a fare subvention agreement (see Chapter 9 for additional details);

• Fare harmonization for conventional service; • Fare equalization between conventional and specialized service; • Initiation of limited conventional service and enhancement of specialized service in northern

communities; • Implementation of common service standards by centralizing all planning and operational functions

to ensure consistency; • Implementation of common vehicle standards; • Regional focus on planning transit services leading to future higher order services in key corridors; • Marketing and branding of transit as a viable service at a regional level; and • Better relationship between conventional and specialized transit, enhancing connectivity and

facilitating improved access to medical facilities including the Durham Cancer Centre and dialysis facilities across the Region.

D.3.1 TRANSFERRING SERVICE TO THE REGION

In order to transfer transit service to the Region there are a number of principles that must be identified to establish the framework for the transfer process. These principles will form the basis of conditions to be included as part of the required Transit Bylaw. The key elements of the transfer framework include:

• Confirmation of the "Cumming Principle" for asset transfer; • Establishing the principles for transit staff transfer to the Region; • Commitments to service retention and expansion; • Funding of transit services; • Preparation and passing of the appropriate legislation - a Transit Bylaw; and • Obtaining a Public Vehicle License.

D.3.1.1 Asset Transfer

The principle for the disposition of a municipality's physical assets (land, buildings, other municipal facilities) was established by an OMB decision relating to the formation of Metropolitan Toronto in 1953. Referred to as the Cumming Principle, it states that all physical assets located in one municipality will become the property of the newly amalgamated municipality without financiai adjustment or restriction on the use or disposition. In this regard, it is recommended that the Cumming Principle be applied for all transit-related assets to be transferred to the Region of Durham, including all transfer-eligible assets held of Handi Transit Inc.

It is expected that most issues with respect to asset transfer would be resolved by direct discussion betwee,n the affected area municipalities and the Region. It is recommended an independent arbitrator be retained, if necessary, to affect the division of assets, liabilities and reserves, provide dispute resolution and mediation services, and render binding decisions in instances where consensus is not achievable.

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Business Case Analysisfor the Potential Transfer o.lLower-Tier Municipal Transit Services to the Regional Municipality o./Durham October 2004

D.3.1.2 Staffing

All permanent, full time, exempt and union positions that are exclusively employed in transit by the local municipalities, transit operators and Handi Transit will become employees of the Region of Durham as of the effective date of transfer. Other staff of the area municipalities who perform work for the local transit agencies as part of their job assignment will have the opportunity to apply for new advertised positions within the Region resulting from the transfer of transit services.

D.3.2 Conditions of Transfer

A Bylaw is necessary to establish a Regional Transit System and to acquire all facilities, equipment and personal property required for the operations, maintenance and extensions thereof. The following conditions are suggested to be included in the By-law or attached as a schedule:

1. Subject to the regulations contained within section 189 of the Municipal Act 2001, and any lawful exception, the Region will assume exclusive jurisdiction over public transportation systems within the Region of Durham as of January 1 2006, hereafter known as the effective date of transfer;

2. As of the effective date of the transfer of services, the Region will operate, maintain and regulate the use of the public transportation system for conventional and specialized services, within the region of Durham and elsewhere, as permitted by law. As of the date of transfer, the Town of Ajax, Municipality of Clarington, City of Oshawa, City of Pickering, Town of Whitby will cease to operate public transportation systems. No area municipality shall operate such a transportation system during the life of the By-law or any successor thereto, save and except pursuant to any service agreements that the Region may enter into with one or more municipalities in the future;

3. The Region may grant the right to other public or private agencies to operate transit services within the Region of Durham;

4. The Region will assume the agreement for the delivery of transit services which currently exists between the Town of Whitby and Trentway-Wagar, Inc. as of the effective date of the transfer of services;

5. Assets and related liabilities used for public transportation systems will vest with the Region of Durham without compensation (Cumming Principle) as of the effective date of the transfer. Assets will include: a) Vehicles and equipment; b) Lands and premises including garages, terminals and shelters; c) Other transit amenities.

The transfer of assets will be subject to confirmation of inventories, appropriate asset valuations and environmental site assessments. The asset inventory will include all assets of the municipalities and transit agencies as of May 2004 and any additional assets ordered/acquired for future delivery. During the transition period, the Region and area municipalities should enter into agreements to specify details of the transfer of assets, liabilities and personnel;

6. Any transit-related financial commitments by the area municipalities and/or transit properties, including transit-related acquisitions or purchases or the entering into of any new transit related contracts, made between the date of By-law approval and the effective date of transfer must be approved by the Region;

7. A dispute resolution and arbitration mechanism/process will be established and employed where such services are necessary, to resolve negotiation of assetlliability transfer and render binding decisions to complete the transfer;

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Business Case Analysis/or the Potential Trans/er a/Lower-Tier Municipal Transit Services to the Regional Municipality ojDurham October 2004

8. The Region will maintain the existing overall revenue hours of service in effect as of May 1, 2004, with the addition of the RosslandlTaunton "beltline" service jointly planned by the City of Oshawa and the Town of Whitby, the planned service realignments in Oshawa and Whitby for implementation in 2004/2005 and enhanced specialized transit service in Oshawa as a result of a vehicle acquired in 2004. The costs of such enhanced service to be agreed upon prior to transfer. The Region will re-assess and revise transit service levels thereafter, as it sees fit;

9. Due to its status as a not-for-profit organization, the corporation of Handi Transit Inc. must be dissolved prior to the transfer of transit vehicles, related equipment and all other assets eligible for transfer to the Region;

10. Discretionary transit reserve funds existing at the date of transfer will be transferred to the Region;

11. Development charge reserve funds, including those resulting from the 1991, 1999 and 200314 By­laws, will be transferred to the Region;

12. Area municipalities will continue to collect transit Development Charges where applicable until local By-laws are amended, including periods beyond the date of transfer. Such development charges shall be transferred to the Region;

13. The transfer of any unfunded liabilities existing at the date of transfer will be negotiated between the Region and the appropriate municipality;

14. Between the date of the By-law approval and the effective date of transfer, any financial commitments, including changes to existing staffing or contractual arrangements with external agencies or suppliers, must be approved by the Region;

15. The interest and obligation of each area municipality in any agreement, purchase order, or lease respecting the provision of public transportation systems, other than highways, shall be assumed by the Regional Corporation and the respective area municipality shall be relieved of all liability under such agreements;

16. The Region may enter into an agreement with any adjoining municipality or the province for the provision of public transportation services upon such terms and conditions as may be specified;

17. The Region may establish fares and tolls with respect to transportation services and make regulations governing the operation, control and passenger use of the system established;

18. The region may acquire, by purchase or otherwise, any facilities, vehicles, equipment, real and personal property required from time to time for the operation, maintenance or extension of the Regional transportation system established herein;

19. All permanent, full time, exempt and union positions that are exclusively employed in transit by the local municipalities, transit operators and Handi Transit as of the date of this By-law, will become employees of the Region of Durham as of the effective date of transfer; and

20. All Provincial and Federal funding received by the local municipalities will be transferred to the Region of Durham. Such funds will include those received from such programs as the Ontario Transit Vehicle Program (formerly the Transit Renewal Program), from the Provincial gas tax program (Dedicated Gas Tax Funds For Public Transportation Program), from potential Federal programs - Federal gas tax, Federal new deal for cities, etc. as well as and any funds held in reserve. This would include any transit-related funding received from all sources following the effective date of transfer.

0.3.3 THE T~~SITION PERIOD

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Business Case Analysis/or the Potential Transfer a/Lower-Tier Municipal Transit Services to the Regional Municipality ()fDurham October 2004

The transition period is defined as the period between the passing of the Region of Durham transit bylaw and the date of effective transfer of local services to the Region of Durham. Subject to the achievement of a Triple Majority approval of the transit bylaw, the activities to be undertaken are significant. The volume and complexity of the work in a number of areas cannot be underestimated.

D.3.3.1 TRANSITION WORKING COMMITTEE

It is suggested that the transitional activities to be undertaken prior to the transfer date be overseen and managed by a Transition Working Committee (rwC) comprised of regional staff representing both operations and program support functions, and reporting through the CAO to RTIC and Regional Council. The Committee Chair should be a member of the Region's senior management team and this position should be a full-time assignment until the completion of phase two of the implementation process. The Committee Chair should be seconded from either the Works or Planning Departments. Work plans should be developed for the tasks to be undertaken. The Committee membership should be confirmed within two weeks of the achievement of the "triple majority" at Regional Council.

Area municipalities will be asked to appoint contact persons for the TWC and may be asked to attend meetings and co-ordinate information requirements at the local level.

TWC Sub-Committee Structure and Key Activity Listing

The following sub-committees should be established in recognition of the key study areas: • Human Resources; • Financial; • Legal • CommunicationslMarketing; • Operations/Planning; and • Implementation.

The identification of issues and subsequent tasks to resolve these issues is based upon the recommendation that the effective date of transfer of transit services will be January 1, 2006. The transition period is the period from the approval date of the Regional Transit Bylaw to January 1, 2006.

Following the implementation of Regional transit service, there is a need to establish policies, protocols and planning procedures to ensure that the services are monitored and maintained in accordance with the plans, policies and principles established in this study and the Durham TMP. As part of the ongoing planning and monitoring process, there is a requirement for the Region to conduct a detailed 5-year transit operations study to confirm future expansion and transit re-alignment initiatives.

It is also recommended that the Region produce an annual transit report card providing a summary of performance. Performance Management Systems for the conventional and specialized components of transit service are provided as Tables 11.7 and 11.8 in the report.

D.3.4 ORGAN1ZA TIONAL STRUCTURE

The re-organization of transit provides an opportunity to create a transit organization specifically structured to effectively deliver services that respond to the policies, goals, and objectives of the Community Strategic Plan, Official Plan, Transportation Master Plan and the Transit Improvement Plan. The review of amalgamation experiences of the YRT and GRT provided valuable insights into the rationale for the formation of their respective organizations. For the Region of Durham, it is

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Business Case Analysis/or the Potential TransFer o/Lower-Tier Municipal Transit Services to the Regional Municipality o/Durham October 2004

recommended that the Region create a separate transit department within its organization. The report shows how the transit department would fit into the Regional departmental context and provides an overview of the structure of the proposed transit department and identifies transit department responsibilities.

D.4 CONCLUSIONS

It is clear from the analysis conducted in the course of the preparation of this report that transit services cannot be delivered in the same manner that they have in Durham Region over the last three decades if the Region and its constituent municipalities wish to achieve modal share targets contained in the Durham TMP and articulated explicitly, or implicitly in Regional and local Official Plans.

Integration of conventional and specialized services across the Region is clearly desired to ensure the viability of transit as a legitimate mode of transportation and to achieve the Region's mobility objectives.

The arguments in favour of the transfer of transit services (conventional and specialized) to the Region of Durham are strong and amalgamation of local services is considered to be in the best interest of the residents from a social, environmental and economic perspective. In response to questions raised in Section A.2.1 of this Executive Summary, the following is provided:

• The amalgamation of local services and the transfer of responsibility for the deliver of conventional and specialized transit service to the Region is a most appropriate and sound delivery option to satisfy public growth and demand;

• An amalgamated service option delivered by the Region of Durham is the best model to ensure that transit services are unimpeded by jurisdictional boundaries or internal barriers. This is the best approach to ensure the integration of transit from both a systems and fare perspective;

• Regional transit service delivery and funding is the only model likely to provide long term service to currently underserviced locations within the Region of Durham;

• Consistent with the delivery of other services within the Region such as roads, sewer and water, regional transit service will best address growth management issues and will permit the linking of decisions on transit to local, regional, Provincial and Federal policy regarding transportation planning and land use. The regional approach to service delivery is als() consistent with the growth management policies of the Province of Ontario and the Region of Durham. A regional transit model is the best option in terms of moving the Region forward in the development of a livable and environmentally sustainable community.

• From an economic perspective, transit has more intrinsic value than just health and environmental considerations. In fact, transit has a wealth of economic benefits which will accrue to the community and are generally not considered in the context of any Business Case Analysis such as this. It is fundamental to recognize that the value of transit cannot be measured by the ratio of the cost to provide this service and the revenues generated from its operation (R/C).

• Consideration of an integrated transit network in Durham funded and operated by the Region of Durham, is consistent with the existing public policy and public sentiment. The proposed plans for transfer of transit service to the Region as documented in this report is realistic and results in a system capable of delivering quality, cost-effective services.

The following opportunities for Innovation/Cost Savings exist with regards to a Regional transit service:

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Business Case Analysis./or the Potential Transler a/Lower-Tier Municipal Transit Services to the Regional Municipality olDllrham October 2004

• Achievement of economies of scale in the long-term; • Rationalization of staff; and • Increase in ridership due to inter-municipal travel may result in an increase in operating revenues.

The following risks have been identified with respect to the amalgamation of transit service in Durham Region:

• Labour Relations - labour union certification, upward migration of costs; • Failure to address complex HR issues through transition period could result in delays in the transfer

of service, additional staff time, increased cost, etc; • Poor communications during transition period could result in schedule creep and stress to existing

transit staff and unnecessary friction between stakeholders; • Any reduction in the Regional Transit Fund due to increased requirements of GO Transit, without

additional Provincial/Federal government funding, may require the Regional transit tax at a local municipal level to be increased;

• Failure to achieve agreement with GO Transit for Highways 2 and 12 service will reduce the effectiveness of the Plan and require increased resources from the Region to provide local service;

• Changes in technology may occur prior to the amalgamation of transit services and the installation of communication and fare box equipment affecting cost; and

• The aggressive nature of fleet renewal/replacement program may not be sustainable by the Regional levy.

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Business Case Analysisjor the Potential TransFer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

RECOMMENDATIONS

Based on the findings of the Business case Analysis, it is recommended that the Region of Durham:

1. Endorse the Business Case Analysis as presented in the document;

2. Endorse the reassignment of the transit responsibilities of the City of Pickering, Town of Ajax, Town of Whitby, City of Oshawa, Municipality of Clarington and Handi Transit Inc. to the existing Regional organization;

3. Determine an appropriate net-cost allocation formula for the levy of Regional transit taxes at a local municipal level.

4. Prepare a transit Bylaw for a Triple Majority vote for transfer of Lower-Tier Municipal Transit Services and Handi Transit Inc. to the Regional Municipality of Durham, with the Bylaw based on the conditions suggested in Section D, Chapter 11 of this document;

5. Apply the "Cumming Principle" to any transit-related asset transfers, and all transfer-eligible assets of Handi Transit Inc.;

Subject to the approval of the Transit Bylaw by Regional Council and the area municipalities, that the Region of Durham:

6. Adopt the following timetable for Regional Transit implementation: Transition Period - Date of Transit Bylaw approval to effective date of service transfer (January 1, 2006);

Resolution of critical HR and union issues including union certification; Staffing of the new Regional Transit Department; Development and implementation of operational and financial controls; Obtain Public Vehicle License for the Region of Durham to operate transit; and Asset transfer.

Completion of transfer - complete transfer of service and initiate Regional transit service -January 1, 2006.

7. Inform the Provincial and Federal governments of the creation of a Durham Regional transit system and pursue the acquisition of additional Provincial/Federal government funding.

8. Extend the mandate of the Regional Transit Implementation Committee (RTIC) of Council to oversee the transfer of transit services;

9. Endorse the establishment of a Transit Working Committee (reporting to RTIC), including an Oversight Sub-Committee (QC Plan) and appoint a Chair of TWC to oversee the actions of the all Committees during the Transition period; and direct the TWC to undertake the action items contained in Tables 11.1 to 11.6 of this document.

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Business Case Analysis for the Potential Transfer of Lower- Tier Mllnicipal Transit Sen'ices to the Regional Municipality of DlIrham October 2004

A. Overview of Current Services and Policy Framework

1 INTRODUCTION

1.1 Study Purpose

The purpose of this Study was to assess whether the transfer of responsibility for the delivery of transit services to the Region from the area municipalities is in the best interest of the residents of Durham Region. Regional objectives for community development and the transportation and transit initiatives required to support that development were considered in undertaking this assessment. In this context, the benefits to be derived and the costs to be incurred by creating a Regional Transit System were examined. If a transfer was demonstrated to be in the best interest of the Region, optimal terms and conditions for the transfer were to be identified.

This report documents the Business Case Analysis Study process followed by the Consultant Team to reach a recommendation regarding the regionalization of transit services in Durham Region.

1.2 Background

The authority for operating public transit within the Region of Durham, other than GO Transit, currently rests with the lower-tier municipalities. Four local operators provide conventional transit services in the Region:

• Ajax-Pickering Transit Authority; • Whitby Transit (contracted through Coach Canada/Trentway-Wager); • Oshawa Transit; and • Clarington Transit (contracted through Oshawa Transit).

Conventional services for inter-regional transit are provided by GO Transit, in the form of bus and heavy rail train service.

Specialized transit services are provided by Handi Transit Incorporated, Ajax-Pickering Transit Authority and Brock Community Care.

On January 12,2004, the Municipality of Clarington adopted a resolution to transfer full responsibility of transit services and capital to the Regional Municipality of Durham (the "Region").

On February 11,2004, Regional Council responded to the Clarington resolution by approving the by-law for accepting the transfer of transit services to the Region, satisfying the Regional or Upper-tier Council majority required as part of the "triple majority". The by-law requested the consent of the lower-tier area municipalities by March 24, 2004. Endorsement by the other area municipalities is a requirement under the Ontario Municipal Act, 2001, which requires a "Triple Majority" in order for an upper municipality (Region of Durham) to assume the responsibilities previously held by the lower-tier or area municipalities.

The "Triple Majority" consists of:

• A majority of all votes on the council of the upper-tier municipality are cast in its favour;

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Business Case A nalysis for Ihe POlell/ial Transfer of Lower-Tier Municipal Transil Sen'ices 10 Ihe Regional Municipalily of Durham October 2004

• A majority of the councils of all the lower-tier municipalities fonning part of the upper-tier municipality (5 of the 8 municipalities in Durham Region) for municipal purposes have passed resolutions giving their consent to the by-law; and

• The total number of electors in the lower-tier municipalities that have passed resolutions under clause (b) fonn a majority of all the electors in the upper-tier municipality. OMA 2001, c. 25, s. 189 (2).

At the March 24th deadline, only the City of Pickering and the Municipality of Clarington passed conditional resolutions supporting the transfer of transit services to the Region. The Towns of Whitby and Ajax opposed the transfer as proposed, while the Townships of Scugog, Brock and Uxbridge deferred the decision to transfer of transit services to the Region and cited that a business case analysis, as recommended by the Durham Transit Improvement Plan (TIP), was required to detennine the viability, costs, benefits and implications of a Regional transit system. The City of Oshawa did not respond prior to the March 24th deadline, however, the City's Strategic Initiatives Committee did respond after the deadline with an endorsement of a proposal to undertake a business case analysis.

1.3 Issues Surrounding Transit and Amalgamation

There are numerous technical, political, financial and other administration issues that had to be addressed in the context of this business case review.

A number of issues were identified that relate to conventional and/or specialized transit, or both. The following key areas contain issues that had to be addressed during the course of the Study:

• Human Resources; • Financial; • Legal; • CommunicationslMarketing; • OperationslPlanning; and • Implementation.

Issues related to communications and implementation were identified but were not fully evaluated within the scope of the Study.

The business case analysis included the examination of non-financial benefits. This analysis included both qualitative and quantitative assessments of whether or not the transfer of responsibility for the delivery of transit services is in the best interest of the residents of the Region of Durham.

1.4 Study Approach/Methodology

A multi-phase workplan was developed to undertake this initiative. The work plan reflects the following general approach/philosophy to this assignment:

• Examine conventional and specialized services in concurrent work streams; • Build consensus throughout the study process; • Reach a thorough understanding of the issues; • Consider viable transit service options/alternatives; • Develop realistic finance and servicing strategies; • Identify real risks and recommend viable risk management strategies; and • Prepare an implementation strategy and work plan.

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Services /0 the Regional Mllnidpali/)' of Durham October 2004

1.4.1 Business Case Analysis Framework

In a conventional "for-profit" business, a typical business case assessment involves using a "scorecard" and a set of universally accepted financial performance measures, such as net income and return on investment, to determine whether or not to proceed with an investment or in a new venture. In the case of transit services, which are typically provided by the public sector, the standard approach to development of a business case using financial performance measures alone is not applicable.

From a full cost accounting perspective, neither the full costs nor benefits of transit are completely measurable. In addition, transit should be viewed as an important public service where the benefits of quality service go well beyond the measurement of costs and revenues. Transit services have historically required public subsidy to operate and will continue to do so until users of other means of transport, including the automobile, are required to pay the full costs associated with their travel.

In assessing the business case for regionalization or amalgamation of transit in Durham, financial measures are important but should not be considered the only criteria to guide decisions regarding the need for, and value of, amalgamated transit services and whether or not such a decision creates long term value for the community.

A decision regarding amalgamation must be made on the basis of assessing whether or not the public will be better served in the longer term by moving towards amalgamated services. In order to make this determination the work associated with this report has attempted to answer the following basic questions regarding both conventional and specialized service within the Region of Durham:

• What is the most appropriate delivery option to satisfy public growth in demand for public transit services and client needs?

• What is the best model to ensure that transit services are unimpeded by jurisdictional boundaries or intermodal barriers (i.e. the provision of integrated transit from both a system and fare perspective)?

• What is the best service delivery model to provide service to currently underserviced locations within the Region?

• What is the model that will best link decisions on transit to local, regional, provincial and federal policy regarding transportation, planning and land-use (growth management)?

• What is the best model to maximize access for all areas and sectors of the community? • What is the best model and operating strategy to ensure that the overall system is affordable and

efficient? • How should transit be provided to best facilitate the development of a livable and environmentally

sustainable community? • Which model best results in the most responsible investment in the community given the long term

growth aspirations of the Region? • Which model will produce the greatest long-term economic benefits for the Region and the local

municipalities? • How will the net operating costs associated with transit be apportioned across the Region, recognizing

that there will be disparities in levels of service? • Assuming that there are alternative service models that can address or respond to the above

questions/objectives, what are the costs and revenues resulting from the implementation and operation of these models and can the net operating costs be sustained by the responsible agency/agencies?

In posing the above questions, it has been assumed that there is a consistent and acceptable vision of transportation and transit for the Region. The vision for transportation and transit is articulated in Chapter 5 of this document.

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Business Case Analysis for the Pote11lial Transfer of Lower-Tier Municipal Transit Sen 'ices to the Regional Municipality of Durham October 2004

In attempting to answer the above questions and by doing so respond to the overarching question regarding the business case for a Regional Transit system, it is fundamental to recognize that public policy making is not an exact science and that the recommendations from this study will reflect an interpretation of current policy and community standards and values. At the end of the day, the final decision to move to Regional transit will be a decision of public policy, which balances public policy objectives such as community growth, environmental sustainability, and social equity against the costs to the public in the form of property taxes.

1.5 Consultation Process

The Business Case Analysis involved significant consultation with local stakeholders (municipalities), transit operators and Regional staff. Receiving the opinions, issues and concerns of each stakeholder group has proved invaluable to the identification of servicing options, opportunities and constraints.

1.5.1 Stakeholder Consultation

Initial stakeholder consultations were conducted with the CAOs and other officials of the local area municipalities between June 4th and June 30th as follows:

June 4th

June 8th

June 14th

June 14th

June 15 th

June 18th

June 22nd

June 30th

- Town of Whitby - Municipality of Clarington - Town of Ajax - City of Oshawa - Township of Scugog - City of Pickering - Oshawa Transit Commission/City of Oshawa - Townships of Brock and Uxbridge

Ongoing consultation was held with staff of the local municipalities and their respective transit staff over the course of the Study. In addition, meetings were held with other stakeholders, including staff of Lakeridge Health Corporation.

1.5.2 Meetings with Other Agencies

As part of the consultation component of the study, meetings were held with representatives of the Ontario Ministry of Transportation, Public Infrastructure Renewal, and GO Transit. The purpose of these consultations was to make these provincial bodies aware of the study, and to determine what impact, if any, there might be on transit service in Durham as a result of existing provincial government programs and services, or potential provincial government transit initiatives.

1. GO Transit - The discussion with GO Transit focused on the cooperative relationships that might be developed between GO Transit and the Regional Municipality of Durham, specifically with respect to services in the Highway 2 and Highway 12 Corridors, and the potential for fare 'harmonization' or fare agreement between GO Transit and any Regional transit service.

2. Ministry of Transportation - The discussion with MTO focused on the likely mandate to be given the proposed Greater Toronto Transit Authority (GTTA), and the continuation of such programs as the Ontario Transit Vehicle Program (formerly the Ontario Transit Renewal Program), and the Transit Improvement Program, both of which were established to provide capital financial support to local transit authorities. With respect to the GTT A, the most likely mandate to be given to that body would be to focus on the planning and coordination of transit within the GTT A in order to support the

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

provincial government's Smart Growth Strategy. There was no indication given that the GTTA would be an operating authority for all transit within the GT A. As far as the specific funding programs were concerned, the advice given was that they were 'on hold' pending the finalization of the government's program to transfer fuel tax revenues to municipalities for transit and transportation expenditures. As far as funding for transit projects was concerned, however, the indication given was that funding would be available to support specific capital expenditures, and that approval would be based on the demonstration of a 'justifiable' business case, and support for provincial priorities. The recent Provincial government announcement relating to the Dedicated Gas Tax Funds for Public Transportation Program provides details of the requirements and funding eligibility of individual municipalities. Gas Tax funds have been added to the analysis in Chapter 10.

3. Ministry of Public Infrastructure Renewal (MPIR) - Discussions with the staff of MPIR covered much of the same ground as those held with MTO, and the advice given corresponded with that received from MTO. The GTTA would focus on planning and coordination, and not operations, and funding would support municipal initiatives that reflected provincial government priorities. There was a suggestion that the allocation of fuel tax revenues would be "on top of an existing funding base". With respect to the provision by the province of 'transition funds' to support any potential amalga,mation of local transit service, the comment was that no funding specifically existed to support this type of expenditure. The question of the continuation of a 'regional fund' to support GO Transit was raised. The response suggested that recent federal/provincial funding announcements with respect to GO's expansion plans 'anticipated' municipal cost-sharing, presumably from the GO Transit Fund.

1.5.3 Technical Steering Committee

A Technical Steering Committee CTSC) chaired by the Region's Project Co-ordinator was formed to guide the study process on behalf of the Region. Representatives from the Planning, Works, Finance, Human Resources and Legal departments participated.

The following Regional staff participated on the TSC:

Project Co-ordinator

Planning

Works

Finance

Human Resources

Legal

Ramesh Jagannathan

Nestor Chornobay Jeff Brooks

Sue Siopis Bob Szwarz

Mary Simpson Steve Tsenis

Tim Oke

Andrew Allison

The TSC Committee met 9 times over the course of the study.

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Business Case Analysisforthe Potential Transfer of Lower-Tier Municipal TransiT Sen'ices to the Regional Municipality of Durham October 2004

1.6 Technical Advisory Group

The Technical Advisory Group (TAG) consisted of the following representatives from the local transit operators:

Ajax-Pickering Transit Authority

Whitby Transit

Oshawa Transit Commission

Clarington Transit

Handi Transit Incorporated

GO Transit

Ted Galinis Neil Killens

David Gooding

Phil Meagher Doug Waite Peter Blanchard

Leslie Benson

Ben Chartier

Mike Wolczyk Ken Armstrong

The TAG met a total of 9 times throughout the course of the Study. TAG members were responsible for co-ordinating data collection within their organizations for use during the study. The TAG was also presented the technical memoranda during the course of the Study for review and comment.

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Business Case Analysis for the Potential Transfer of Lower-Tier Mllnicipal Transit Sen'ices to the Regional Municipality of Durham October 2004

2 POLICY FRAMEWORK

It is important that any public sector initiative that has the potential for significant impact on the community be consistent with public policy at a local, regional, provincial and federal level.

Enhanced or expanded transit has the potential to affect land use, urban form, transportation and the environment. In addition, substantive changes to the provision of transit in Durham will likely require additional investment and public resources.

This chapter provides an overview of local, regional, provincial and federal policy that provides a framework for changes to transit services in Durham.

In addition, this chapter includes a review of other reports, documents and articles that have been examined as part of the Business Case Analysis.

2.1 Regional Official Plan (ROP)

The Official Plan (March 2004 consolidation) for the Regional Municipality of Durham (ROP) sets out the strategic objectives for growth and development within the Region with respect to land use, urban form, transportation and transit. The Regional Official Plan (through the Transportation Master Plan) identifies the major corridors that are to comprise the Regional Transit network and identifies goals and objectives for conventional and specialized transit in both the urban and rural areas of the Region.

2.2 Regional Community Strategic Plan (eSP)

In July 2003, Regional Council adopted a Community Strategic Plan (CSP). Within the parameters of the ROP, the CSP is the 'umbrella document' intended to guide growth and development within the Region. The CSP articulates the 'community vision' of Durham Region as a unified group of vibrant communities and commits the Region to meeting the needs of the residents of Durham through leadership, cooperation, and service excellence. In addition, the CSP outlines a number of objectives including:

• The strengthening and integration of the transportation system within the Region; • The protection and enhancement of the environment; • Ensuring balanced growth; and • The support of livable communities.

Specifically with respect to transit, the CSP sets as the objective the creation of a viable, affordable, and integrated transit system, which will facilitate the movement of the Region's residents between communities within the Region and beyond, and reduce the congestion on the Region's roads?

2.3 Regional Transportation Master Plan (TMP)

Within the context of both the ROP and the CSP, the Transportation Master Plan (TMP), adopted by Regional Council in 2003, defines in greater detail the elements of the transportation network, and recognizes that an efficient and effective public transp0I1ation network is critical to the long-tem1 economic, environmental, and community sustainability of the Region. The TMP recommended that public transit services should:

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BlISiness Cnse Analysisfor the Poten/inl Transfer of Lower· Tier Municipal Transit Sen'ices to the Regional Mllnicipality of DlIrhnm October 2004

• Meet the basic mobility needs of people who have no other travel alternatives through a base level of service, at reasonable cost;

• Offer a viable and competitive alternative to the private automobile during peak periods of travel in high demand corridors; and

• Expand the canying capacity of the transportation system,

The TMP defined a Transit Priority and Bus Rapid Transit (BRT) network for the Region. The Transit Priority Network is based, in part, on current and anticipated transit usage, future travel demands, and the land use plans and policies contained in the Region's OP. It combines the key elements of the GO Transit Commuter Rail System with priority measures to be implemented on arterial roads and freeways. The Transit Priority Network is shown in Exhibit 2.1. The TMP also took into consideration the location of both existing and planned GO Transit bus routes and stations, existing transit designations contained in the ROP, and the BRT proposals outlined in the GO Transit Long-Term Capital Strategy. Also identified in the TMP were strategic targets for reduced a~to travel and increased transit use.

Through approval of the TMP, the Region of Durham has committed to achieve the highest diversion of single occupant vehicle travel to other modes that is reasonably practical, given current travel habits and the present focus on the automobile. The goal will be challenging to reach, but can be achieved through implementation of the strategies recommended in the TMP, such as:

• Designation and development of the Transit Priority Network; • Upgrading of the Highway 2 corridor to a significant inter-municipal transit corridor; and • Encouraging GO Transit to expand services throughout Durham Region to provide additional inter­

regional transit opportunities for Durham.

The Durham Mobility Study Public Opinion Survey conducted as part of the TMP study revealed that the residents of the Region felt that there was a need for greater connectivity between the Region's municipalities, and approximately 85% of respondents considered better inter-municipal transit was either essential or fairly important.

The TMP recognized that the needs of the Region's rural communities for public transit were best met through the provision of demand-responsive para-transit type services. Such services fill the niche between private and public transportation, and utilize equipment suited to the level of demand. Similarly, the TMP recognized that there was a need for specialized transportation services to meet the needs of the disabled. Both Handi Transit Inc. and APT A currently provide these services, and the TMP suggested that they be integrated to serve the whole of Durham Region.

2.4 Durham Transit Improvement Plan (TIP)

The Transit Improvement Plan (TIP) was prepared as a follow-up to the work associated with the TMP. In October of 2001, Regional Council approved the creation of a Task Force, comprising the Regional Transit Co-ordination Committee and the heads of the Municipal Councils in Durham, to develop a plan to consider a regional transit system. The goal of the TIP was to develop level of service guidelines and a plan to increase transit ridership and usage in the short and long term. Building upon the recommendations of the TMP in a supportive and complementary manner, the TIP considered both conventional and specialized transit on a region-wide basis, and identified potentially significant benefits that would accrue from further amalgamation of services within the Region. The TIP provided a range of recommendations relating to service enhancements to local, inter-municipal, and inter-regional transit services, including enhanced level of service guidelines and enhanced GO services through Durham Region. Service enhancements, such as harmonized service standards between APT A and Handi Transit

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Sen'ices to the Regional Municipality of Durham October 2004

Inc., were recommended for specialized services within the Region, and it was also recommended that a rural para-transit service be assessed and if feasible, implemented in the longer-tenn.

2.5 Places to Grow/Infrastructure Financing Framework - Ontario

The Province of Ontario, through the Ministry of Public Infrastructure Renewal (MPIR), recently released a discussion paper outlining the directions and actions to be taken within the Greater Golden Horseshoe (GGH) Region to manage future growth. The plan will provide a provincial vision and strategy for managing growth over the next 30 years, and will:

• Identify priority urban centres, including Oshawa and Pickering, and strengthen the transportation linkages between those centres;

• Protect and manage greenlands; • Invest in infrastructure that supports growth priorities; • Amend the planning framework to promote provincial/municipal cooperation; and • Create regulatory and fiscal tools, which assist municipalities to implement strategies that support

growth priorities.

The document emphasizes greenspace protection, redevelopment of 'Brownfield' and 'greyfield' land, and the intensification of development where there is school/transit/infrastructure capacity, and where transportation station hubs (GOIBRT/Subways) currently exist. The document proposes more rigid standards for greenfield development, the acceleration/facilitation of the approvals process for the re­development of brownfields and greyfields, and possible changes to the Development Charges Act to support these initiatives.

The document emphasizes the need for travel choices both within and between urban centres, and the need for fast, convenient, and cost effective public transportation. Traltsit will be the first priority for iltvestmeltt, altd there will be co-ordinatiolt and ilttegration of transit services across municipal boultdaries through the introductiolt of such mechaltisms as all integrated ticketing system. There will also be standards and perfonnance measures, e.g. transit ridership, put in place for all transit operations within the GGH.

The province will develop a ten-year infrastructure plan and provincial investment will support those initiatives, which are supportive of the growth plan. With respect to transportation and transit infrastructure, the overall objective is an integrated transportation network for the GGH, and the provincial investment strategy will emphasize optimizing the use of existing infrastructure, support strategic investments, and co-ordinate long-range provincial infrastructure plans with those of all other levels of government.

Additional reports, documents and publications reviewed as part of the Business Case Analysis include the following:

• Local Official Plans; • The Need for Expanded Resources for Paratransit in Durham Region - To Service those living with

End Stage Renal Disease, Lakeridge Health, 2004; • Straight Ahead - A Vision for Transportation in Canada, Transport Canada 2003; • Urban Transit Fact Book, 2002 Operating Data - Canadian Urban Transit Association; • Specialized Transit Fact Book, 2002 Operating Data - Canadian Urban Transit Association; • Sustainable Transportation: The Canadian Context, Transport Canada, 2001; and • National Vision for Urban Transit to 2020 - Discussion Paper, Transport Canada, 2001;

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Business Case Analysis for the Potential Transfer of Lower-Tier Mzmicipal Transit Services to the Regional Mllnicipalit)" of Durham October 2004

• The Genesis of Grand River Transit (GRT), Region of Waterloo, 2000; • York Region Transit (YRT) Project, Region of York, 2000; • A New Vision for Urban Transportation, Transportation Association of Canada (T AC), 1998.

2.6 Summary

Examination of the key public documents reveals a number of themes regarding the provision of transit in urban, suburban and rural communities that should be considered as part of the review of transit services in the Region of Durham:

• The benefits of transit go well beyond health and environmental considerations. In fact, transit has a wealth of economic benefits;

• Transit has more "value" to the community than the components of the network; • Transit "value" is also more than the ratio of the cost to provide the service and the revenues

generated from its operation; • Transit is more effective when operated as part of an integrated network that provides choice for

users; • Federal and Provincial Government policy statements place a high priority on the importance of

public transit. New investment models are being explored by both levels of government; • A viable and integrated public transit system will be one of the keys to reducing auto dependency in

the future and achieving more compact forms of urban development; • More attractive service and integrated market share for transit are essential elements to increasing

ridership; • The benefits or co-benefits of public transit although difficult to quantify, should be considered in the

context of the evaluation of any new services; and • The Business Case for public transit must not only include an assessment of costs and revenues but

must be linked to other issues and benefits such as community wellness.

From both a provincial and federal perspective, it is clear that transit will be the first priority infrastructure investment. It is also apparent from recently released policy documents that new investments in transit are being considered by both levels of government.

The overall objectives of these policy documents and funding strategies are to create an integrated and functional transit network for the GGH.

Consideration of an integrated transit network in Durham, characterized by both higher levels of inter­municipal and inter-regional connectivity and service, is consistent with existing public policy and public sentiment.

Page 10

@ TOWNSHIP OF

UXBRIDGE

See Enlargement for Detall

Lake Ontario

N

I o 1 2 4 6 8 10 !.i!.wl !.wi I

Kilometres

I : I

\1

NOTES

TRANSIT PRIORITY NETWORK

Tl'w$t9Ur.to,",sparlol"'-OurhIlTlTra.nspo~1Ion Masta, ~...:I mus! bt Iud m COI1und1on wdh ltI.text

- Major Transij Corridors

- MinorTransijCorridors

~ 'Mainstraet' Highway 2

'oc_-, -= Highway 407 Transit Corridor

~,-'" Highway 401 Bus Rapid Transit

-+-+- Commuter Rail

-+-+- Future Transportation Corridor

• Transportation Centres

D Municipal Boundaries

Urban Area

Note" Dashed lines represent Transit Pnorrty corndors on future roads

ThiSmapISIll18f\08diH.t""'twOlII;tol~and desIgnAlpl(lftClslresub!ecIlo'ullMro.1aJltd51uc!y II'I.uGOIlI,;mr;,...,ItI.En"'l\3fIIIIent~"'SHssm...,tkl Enlargement Detail

_~~~=~-~ ?~~D'~5 _-_ -,-----~_____r__-_ -------------

e \ \ \

\ \ \ I

CITY OF PICKERING

Kilometres

10 ,

-- -~- --0 CITY OF OSHAWA

Business Case Analysis for the Polential Transfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

3 OVERVIEW OF EXISTING TRANSIT SERVICES

This chapter provides an overview of conventional and specialized transit services provided in the Region based on infonnation collected from the transit operators over the course of the study.

3.1 Conventional Transit

3.1.1 Ajax-Pickering Transit Authority

In 2001, the transit services operated by Ajax and Pickering Transit were amalgamated into a single transit agency. Ajax Pickering Transit Authority (APTA) is a public body governed by a Joint Board of Management comprising political representatives from Ajax and Pickering.

As a result of amalgamation, a total of 26 routes are now operated during the weekday peak periods. At the present time, during the evenings and on Sundays, patrons requiring transit service call APT A and make a reservation for pick-up. Although specific pick-up times cannot be requested, the door-to-door bus service will arrive at a patron's home within the 50 minute time frame selected during the reservation call. Requests are accepted until 11 :45 p.m.

On Sundays, a "flag" bus is operated between 11 :30 a.m. and 6 p.m. along a fixed route that stops at the AjaxlPickering Hospital, most seniors homes, the Ajax Plaza, the Durham Centre and Pickering Town Centre.

APT A currently has 51 conventional transit buses and 3 flag buses.

The routes are highly oriented to the GO stations in Ajax and Pickering. Service coverage for some residential areas is achieved through the operation of relatively large inefficient on~-way loops. APTA does not have a long-tenn strategic plan in place defining planned improvements to service.

3.1.2 Whitby Transit

Established in 1980, Whitby Transit, currently under a contract with Coach Canada (Trentway-Wager), operates seven municipal transit routes and uses a total fleet of 29 vehicles during peak periods. Service is offered Monday through Friday from 6:00 a.m. until 2:00 a.m., and on Saturdays from 8:00 a.m. until 7:00 p.m. Service is offered every 20 minutes during the peak period, and every 30 to 60 minutes (depending on the route) during off-peak periods. Service is not currently offered on Sundays.

The routes are oriented to downtown Whitby with peak period route extensions to the GO Station to recognize the significant GO Rail demand.

Whitby Transit completed Phase 1 of a Services Review in 2003. The Town is currently in the process of implementing key aspects of their Transit Services Review.

3.1.3 Oshawa Transit

Transit operations officially began in Oshawa in 1960 and were originally managed by the Oshawa Public Utilities Commission. In 1996, the City of Oshawa created a separate commission to oversee transit operations. Since then, the City of Oshawa has managed and financially supported the transit system

Pagel2

Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

through the Oshawa Transit Commission (OTC). City Council appoints a board of directors to manage OTe.

OTC currently operates 15 routes daily using a fleet of 45 transit vehicles. Weekday service is offered between 5:40 a.m. and 1 :00 a.m., although service times vary by route. On Saturdays OTC operates 13 routes between 6:00 a.m. and 1 :00 a.m. On Sundays and Holidays, service is reduced to three routes, which operate between 9:00 a.m. and 10:00 p.m.

The route network is focused on the downtown and Oshawa Centre with connections to the GO Train Station in Oshawa.

Oshawa Transit Commission is currently in the process of implementing elements of their 10-Year Service Plan completed in 2003 including service realignments.

3.1.4 Clarington Transit

Clarington Transit initiated revenue service in September 2002. The Municipality of Clarington currently contracts services from the Oshawa Transit Commission. The Municipality of Clarington owns 2 buses and leases another vehicle. Service is presently provided in the following areas:

• Courtice - Durham Highway 2 (provided under OTC); • Bowmanville - Aspen Springs; • AMlPM School specials in Courtice and Bowmanville; and • Service to Orono (2 days/week) and Wilmot Creek (3 days/week).

Clarington Transit completed a Transit Master Plan in 2004 to guide the development of services to 2008 and beyond.

3.1.5 GO Transit

GO Transit operates two different services within the Region of Durham, including:

• GO Train service supported by the "train meet" buses (Lakeshore East and Stouffville Line); and, • Local, intra-regional and inter-regional bus service on Highway 2/401, Highway 12 and Highway

40717.

The "train meet" operation extends from the Oshawa GO station easterly to Courtice, Bowmanville and Newcastle. The schedule operates with headways of 30-minutes during peak periods and 60-minutes during off-peak periods. The "train meet" operation is an extension of the GO-Lakeshore East train that operates daily between the Oshawa GO Station and Toronto Union Station. From Monday to Friday the train operates with headways of 30-minutes during peak periods and 60 minutes during off-peak periods. On the weekends, train service is only available to Pickering and points to the west and operates on a 60-minute frequency schedule. During weekends, train-meet service is offered easterly from Pickering to Newcastle.

The Highway 2/401 Service operates between Oshawa and Yorkdale Shopping Mall along Highway 2 through Oshawa, Whitby, Ajax and Pickering. During the weekday peak a 12-minute frequency is provided and a 30/60 minute evening/off-peak frequency is offered. This operation is supplemented in the peak direction (westbound morning, eastbound afternoon), with express services along 401 connecting the GO Train stations in Durham into the Toronto Transit Commission subway (Finch Avenue Station).

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Business Case Analysis for the Potential Transfer of Lower- Tier Mllilicipal Transit Services to the Regional Municipality of Durham October 2004

The Highway 2 service also connects municipalities in Durham to the Scarborough Town Centre, Y orkdale Shopping Mall, and the York Mills subway station.

GO Transit also offers service along the Highway 407 corridor. The eastern terminus is Durham CollegefUOIT, and the western terminus is the Hamilton bus station, with service to York University and McMaster University. Service began on September 7, 2004.

GO Transit also provides service to some of the northern Regional municipalities and townships, including Beaverton, Port Perry, Uxbridge, Cannington, Sunderland, Greenbank, Myrtle, and Brooklin on Highway 12. The Highway 12 service operates in the a.m. and p.m. peak periods. The Stouffville GO Train and Bus service, which also serves Uxbridge, is offered on a 30/60-minute frequency during peak periods and a 2-hour frequency during the off-peak.

Recently GO Transit announced the purchase of property in Bowmanville adjacent to the West Central Area (Regional Road 57 and Highway 2) for the purposes of creating a transportation hub at a potential future GO Rail station.

3.1.6 Transit Services to the North

Currently transit services to the north are available only by GO bus service (see Section 3.1.5). Durham residents using such service must pay the full GO fare to travel within Durham. A recent transit feasibility study conducted by the three northern municipalities revealed that it would not be financially feasible for the municipalities to fund their own conventional service.

3.1.7 Conventional Transit Comparison

Two Canadian Urban Transit Association (CUTA) performance indicators have been chosen to provide a comparison of the investment of transit per capita within the municipalities and the revenue vehicle kilometres per capita (See Charts 3.1 and 3.2). Transit data was available from 1997 to 2003. It is important to note that Clarington Transit is not included for (200212003) and Ajax Transit did not provide information in 1998.

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-------------------------------

Business Case Analysis/or the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality o/Durham October 2004

Chart 3.1

Municipal Operating Contribution/Capita

$3500 r--------------------------------~

$3000 -$2500

i $20.00

I $1500 - ,... ----$1000

IS 00 ;

1000

j 1 ! J 1 ) j ! i I ! i 1 " " ! J ! I ~ j r j ~ j J J ~ z '< " ~ ~ ~ 5 ~ ~

~ 5 ~

~ ~ ~ ~

~ ~ ~ ~ ~ ~ ~ TrMSIt Authority and YNI'

Chart 3.2

Revenue Vehicle Hours divided by Capita

100

I 090

080

070

~ 0.60

j .. 050

l' - f- r-

J 0.0 - f- f-

0'0 - r- r-

0.20 - f- I-

010 - f- I-

000

T ....... ~andY ...

The municipal operating contribution per capita has almost doubled in the period from 1997 to 2003 growing from approximately $12.00 in 1997 to approximately $25.00 per capita in 2003. It is interesting to note that the revenue vehicle hours per capita has maintained a value of approximately 0.59 over the same period, in indication that the costs of providing transit are increasing while the level of service for users remains largely the same.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Sen'ices to the Regional Municipality of Durham October 2004

3.1.8 Transit Initiatives by the Region of Durham

3.1.8.1 Durham College/uOIT Student Bus Pass Program

On September 1, 2003, Durham Region, Durham College and the University of Ontario Institute of Technology launched the Student Pass program. The service improvements include new routes serving the Whitby and Oshawa campuses (APTA #101 and OTC #20) and lower fares for transit connections between local transit services and GO Bus service for selected routes.

Central to the plan is a new Durham CollegelUOIT Student Transit Pass that is available only to Durham CollegelUOIT students and sold at the Student Centre on campus. The Pass offers considerable cost savings over the current transit fare structure, and allows unlimited travel on all local transit services within Durham Region. In addition to local transit services in the southern urban municipalities, passholders are also able to ride existing connecting GO Bus routes to Bowmanville and Newcastle (along Highway 2) in the Municipality of Clarington and to Port Perry in the Township of Scugog along Highway 12.

This plan has been an overwhelming success and is offered as evidence of unsatisfied demand for inter­municipal service in Durham.

3.1.8.2 Durham D-Pass

On September 1, 2003, Durham Region launched its Regional Pass or "D-Pass" program. This initiative, recommended by the DTIP and subsidized by funds from the GO Transit Regional Tax Levy, allows monthly GO Pass holders to purchase a $25 sticker which allows unlimited access to all regular local transit routes in Durham Region. In Durham Region, "local transit" means routes provided by the Ajax­Pickering Transit Authority, Clarington Transit, the Oshawa Transit Commission and Whitby Transit.

3.2 Specialized Transit

3.2.1 Handi Transit

Handi Transit Incorporated was established in 1974. Its original purpose was to provide transportation services to persons with disabilities residing in the City of Oshawa. Handi Transit was incorporated as a non-profit organization in 1977. Since then, its service area has grown to include the municipalities of Whitby, Clarington, Scugog and Uxbridge. The service is available to persons who cannot use conventional transit services (i.e. unable to board conventional transit or walk 175 metres) and can meet the eligibility requirements. Requests for priority trips such as medical appointments OR TO work and school are accepted up to 14 days in advance. Requests for other trips, such as social visits or shopping are accepted from 3:00 p.m. the day before the trip is needed. The levels and tenns of service to be provided by Handi Transit are contained in separate agreements with each of the five municipalities.

In 1999 with the merger of the five Lakeridge Health Corporation (LHC) sites, and the relocation of services amongst the sites, transportation surfaced as a major barrier to the LHC re-development process. Handi Transit was identified as an appropriate partner to co-ordinate selected LHC patient transportation needs. Handi Transit provides "mobility challenged" dialysis patients with a means of getting to/from their treatment appointments. LHC staff identify the eligible patients and Handi Transit co-ordinates the transportation schedule; utilizing the most appropriate and cost-effective means (either Handi Transit van or taxi). Handi Transit also provides transportation for resident patients at the Oshawa, Whitby and Bowmanville sites. These trips are generally between LHC sites, or trips for other non-emergency medical purposes. Caregivers (family members) with mobility problems are also provided with

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

transportation to LHC sites. In 2004, it is forecast that LHC will reimburse Handi Transit approximately $80,000 (increase of 11 % from 2003) to provide transportation for dialysis patients. Fiscal constraints at LHC will mean that these funds will not be available in 2005 although the volume of patients to be transported will not be reduced.

Handi Transit also administers a program on behalf of the City of Oshawa for the provision of transit services for eligible visually impaired residents of Oshawa. The program relies on services from City Wide Taxi to provide transportation for eligible visually impaired residents.

As a non-profit organization, Handi Transit service is constrained by the availability of vehicles. As a result, the lack of available service often results in hospital transfers being undertaken by EMS services at an increased cost to EMS and the community. Although the additional costs are not readily available for the use of EMS vehicles, this issue has been raised by staff of Handi Transit and Lakeridge Health.

Handi Transit currently operates the following vehicles:

• Oshawa - 7 vehicles • Whitby - 4 vehicles • Clarington - 2 vehicles • ScugoglUxbridge - 1 vehicle

3.2.2 APTA Specialized Transit

APTA also provides specialized transit services focusing on the Ajax-Pickering communities. Door-to­door specialized transit services are provided with 11 lift-equipped buses. Specialized transit clients must meet APT A's specific eligibility requirements. APT A applies the previous provincial guidelines to determine eligibility for specialized transit services, i.e. those who are either physically unable to climb or descend three steps or unable to walk 175 metres. Those with mental or cognitive disabilities are also eligible to use APTA's specialized services. Low-floor buses (which are also used on some conventional transit routes) are used to serve eligible clients. There are currently 11 low-floor buses operating on daily conventional transit routes. Two "flag" transit routes also use low-floor buses.

In order to use the door-to-door service, registrants must pre-book their trips. Although appointments can be booked up to two weeks in advance, same day requests are accommodated when possible. APT A operates on a first-come, first-serve basis. No priority is given for particular trips, such as medical appointments. If a registrant must cancel an appointment, notice must be given at least one hour in advance. If a registrant fails to cancel an appointment, the return trip will automatically be cancelled and a fee charged. The service is offered primarily within the municipal boundaries, although some service is offered for trips to Oshawa, Whitby and Scarborough for an additional fee.

3.2.3 Community Care - Brock

In March of 1999, upon receiving an accessible van purchased by Durham Region Community Care Association, Brock Township began offering specialized services under the auspices of Community Care. Community Care does not operate as a transit agency.

Each potential participant of Community Care is assessed on an individual basis, although eligibility is restricted to those persons unable to ride conventional transit.

Priority is given to clients requiring the service for medical appointments and adult day programs, although trips may be scheduled at any time during business hours (Monday to Friday, 8:30 to 4:30).

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

Although service is generally limited to areas within Durham Region, inter-regional travel IS often approved for medical appointments.

Brock Community Care operates primarily during business hours, although registrants are able to request trips for other times. Requests are accepted depending on availability of drivers. Volunteer drivers and other volunteer vehicles are also used to help accommodate requests.

3.3 Assets

Data was obtained related to existing transit assets of APT A, Whitby Transit, OTC and Clarington Transit.

The asset information requested focused on items directly related to (although not necessarily exclusive to) public transit rather than such items as office equipment and supplies, etc. As such, data was gathered on revenue buses, non-revenue vehicles, bus terminals, bus loops, bus garages, bus shelters and stops, transit computer hardware and software, spare parts inventories and communication systems.

Although the analysis of the information received indicates a good representation of the assets, there are data gaps. The financial valuation of the assets is inconsistent across the municipalities and this has been noted.

No assessment of valuation of the co:ndition of assets was undertaken for this study, although a full valuation is recommended prior to the transfer. Bus garages equipped with fueling facilities (APTA main garage, Pickering PUC and OTC bus garage) have been identified as a liability risk with regard to the condition ofthe fuel tanks and the potential for soils contamination on site.

The Pickering PUClbus garage is recognized as a joint use facility that will require further investigation/discussion, and potentially, a negotiated settlement to identify the land and premises that would be transferred to the Region at no cost. While no documented evidence was found, it is believed that the Pickering facility was subsidized by provincial transit funding.

Similarly, the Oshawa garage is located on a large tract ofland that is not entirely dedicated to transit use. Further discussions between the Region and City are necessary to resolve the specifics of the asset transfer.

Table 3.1 summarizes the transit-related assets for each of the individual municipalities and Handi­Transit, as provided by the relevant agency.

Table 3.1 - Existing Asset Listing

b .. Average Age of Fleet ; 1991 1986

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

A transit operator, is provided in Appendix A.

..

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Business Case Analysis for the PotellIial Transfer of Lower- Tier Mllnicipal Transit Sen'ices to the Regional Municipality of Durham October 2004

3.4 Funding of Existing Transit Services

3.4.1 Regional Transit Funding

As part of the province's Local Services Restructuring Initiative of the late 1990' s, the regional governments in the GTA were assigned responsibility for providing capital and operating funding to support GO Transit, and, to respond to this new responsibility, the Region of Durham introduced a Regional Transit Fund. In 2002, the Province reassumed responsibility for GO Transit operational funding that was downloaded to the municipal sector in 1998. Since 2002, the Region of Durham has raised $12 million per year from property taxes, with approximately $3.6 million used to fund the Region's share of GO Transit capital expenditures. The remaining 70% ($8.4 million) has been used to support regional transit and transportation demand management initiatives (approximately $1.35 million in 2004) and the balance has been transferred to the area municipalities for their individual transit needs.

3.4.2 Conventional Transit

The net direct costs of the municipal transit services, with the exception of Clarington's, are primarily funded by the relevant local municipality through a component of the local property taxes. Funding for system expansion has also been provided through such programs as the provincial Transit Renewal Fund and through the allocation of funding from the Regional Transit Fund to the area municipalities. Currently Clarington.'s entire transit program is funded from this Fund. The allocation of the Regional Transit Fund is reviewed on an annual basis and is not guaranteed to be available in the future. Without these funds, municipalities would be hard pressed to expand/enhance services in the future; indeed, should such funds no longer be available or be provided at a reduced level, service in Clarington would likely be in jeopardy.

Table 3.2 provides a summary of the estimated net operating costs associated with each of the transit services within the Region. The costs shown are in 2004 dollars and have been extracted from 2004 budget information provided by each municipality. These costs do not include hidden or indirect costs associated with other services provided by municipal staff but not included in transit system budgets.

Table 3.2: Net Operating Costs and Revenue of Conventional Transit in Durham Region Municipality Expenditure Revenue Net

Oshawa $11,544,400 $6,968,500 $4,575,900 Whitby $4,298,800 $1,776,600 $2,522,200 Clarington $740,600 $151,000 $589,600 APTA $9,043,570 $4,124,680 $4,918,890

Total $25,627,370 $13,020,780 $12,606,590

As with other municipal services, funding for transit is closely scrutinized. Within each municipality funding for service and infrastructure, including new and replacement vehicles, must compete for with needs for other municipal services. Due to the challenging economic environments that each transit system operates within, the focus of many of the municipalities is on cost control rather than service enhancement, which greatly affects the ability of the operators to meet the growing needs of the local residents. The current service deficiencies and aging fleets, which are characteristic of almost all of the urban municipalities along the lakeshore, are a reflection of the challenges that face local councils.

Capital expenditures and funding for transit purposes are outlined in Table 3.3 for all eight Durham municipalities, based on actual data, for the years 2000-2003. The combined level of annual capital expenditures was approximately 1.0 million in 2000 and 2001, $5.7 million in 2002 and $2.5 million in 2003. Overall, funding from reserves, including development charge reserve funds, was the primary

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Business Case Analysis for the Potell/ial Transfer of Lower- Tier Municipal Transit Services 10 the Regional Municipality of Durham October 2004

funding source, followed by the "Revenue Fund," which is the operating budget. Funding from capital grants, other municipalities and other sources was negligible ($100,000 in total over the four year period).

The discretionary reserve and reserve fund balances for transit purposes are outlined in Table 3.4. A portion is for current operating purposes ($1.5 million as of December 31103), with $3.2 million for capital purposes.

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Bllsiness Case AnI/lysis for tile Potential Transfer of Lower-Tier Municipal Transit Services 10 file Regional Municipality of Durham Octobcr 2004

2003

Pickering Ajax IWhitby pshawa Clarington Scugog Uxbridge Brock

rrotal

2002

Pickering Ajax Whitby Oshawa

!Clarington Scugog Uxbridge Brock

!Total

TABLE 3.3 DURHAM TRANSIT

CAPIT AL FUND FINANCING AND EXPENDITURES 2000-2003

Sources of Capital Fund Financing Contributions From Own Funds Capital Grants

Revenue Fd. Reserves Ontario Canada Other Other

Municipalities Financing

1,813,099 - - - -- - - - -- - -

89,800 267,254 - -- 298,803 - - - 3,45

nla n/a n/a n/a nla nl - 2,212 10,461 - -- - - - -

1,902,899 568,269 10,461 3,45

Sources of Capital Fund Financing Contributions From Own Funds Capital Grants

Revenue Fd. Reserves Ontario Canada Other Other

Municipalities Financing

201,317 - - -211,945 4~,525 - 17,729

- 80,607 - - - 16,15 60,100 4,748,301 - - -51,209 307,050 5,128 -

- - - -- 33,259 2,331 - -- -

524,571 5,209,742 7,459 17,729 16,15

Sub-Total Capital Financing

Expenditures Required

1,813,099 1,813,099 -- - -- - -

357,054 397,866 40,812 302,253 248,803 (53,450)

nla nla n/a

12,673 2,212 (10,461)

- - -

2,485,079 2,461,98C (23,099

Sub-Total Capital Financing

Expenditures Required

201,317 307,054 105,737 270,199 218,571 (51,628)

96,760 96,760 -

4,808,401 4,623,902 (184,499)

363,387 379,591 16,204

- - -35,590 35,590 -

- - -

5,775,654 5,661,468 (114,186

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Business Casc Analysis/or the Potential Tramfer o/Lowcr-Ticr Municipal Trallsit Services to the Regiollal MUllicipality o/Durham Octob('r 2004

Table 3.3 (cont'd)

Sources of Capital Fund Financing 2001 Contributions From Own Funds Capital Grants

Revenue Fd. Reserves Ontario Canada Other

Municipalities

Pickering 186,898 207,493 - - -IAjax 347,287 122,887 - - 10,669 Whitby - - - -Oshawa 14,400 480,285 - - -Clarington - - - - -

Scugog - - - - -Uxbridge - - - - -Brock - - - -Total 548,585 810,665 - - 10,669

Sources of Capital Fund Financing 2000 Contributions From Own Funds Capital Grants

Revenue Fd. Reserves Ontario Canada Other

Municipalities

Pickering 60,104 145,000 - - -Ajax 272,877 216,578 - - 6,848

Whitby - 74,741 - - -

Oshawa (14,757) 117,558 - - -Clarington Scugog - - - - -Uxbridge - - . - - -Brock - - - - -Total 318,224 553,877 - - 6,848

Source: Financial Information Returns

Other Sub-Total

Capital Financing Financing Expenditures Required

394,391 283,412 (110,979) 22,51 503,360 649,449 146,089

- - -494,685 81,681 (413,004)

- - -- - -

- - -

- - -22,51 1,392,436 1,014,542 (377,894)

Other Sub-Total

Capital Financing Financing Expenditures Required

5,00 210,104 117,094 (93,010) 496,303 371,343 (124,960)

74,741 74,741 -102,801 516,764 413,963

- -- - -- - -- - -

5,00 883,949 1,079,942 195,993

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Business Casc Antilysis fa/' tllc Potcntial Trallsfc/' of Lower- Tie/' Mwricipal 7)-allsil Services 10 Ille Regional Municipality of Durlltllll October 2004

TABLE 3.4 DURHAM TRANSIT

CONTINUITY OF RESERVES AND RESERVE FUNDS

Discretionary Res. Fd

or Reserves Current

Pickering Reserves

Ajax Discretionary Res. Fd.

Whitby Discretionary Res. Fd.

Oshawa Reserves

Clarington Reserves nla

Scugog . Reserves

Uxbridge Reserves

Brock Reserves

Total

SOUlce: Fmanclal InfonnatlOn Reports, 2000-3 * as of December 31

2000*

Capital Total Current

- - -

- - -

- - -

-750,951 750,951

nla nla

- - -

- - -

- - -

-750,951 750,951

Note: These figures do not include Development Charges Reserve Funds.

2001*

Capital Total Current

- - - -

- - - -

- - -1,545,600

- -796,139 796,139

- - -467,934

- - - -

- -18,499 18,499

- - - -

-814,638 814,638 2,013,534

2002* 2003*

Capital Total Current Capital Total

1,242,50 1,242,507 - 1,106,63 1,106,634 7 4

- - 7,007 7,007 -

-1,545,600 904,962 - 904,962

(895,762 (895,762) - 1,762,91 1,762,919 ) 9

-467,934 587,191 - 587,191

- - nla nla nla

- - -

- -

168,000 168,000 - 320,400 320,400

514,745 2,528,279 1,499,1 3,189,95 4,689,113 60 3

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

In addition, obligatory reserve funds for transit service development charges, which are not detailed by service in the Financial Infonnation Return, are as follows as of December 31,2003:

Table 3.5: Obligatory Reserve Funds for Transit Service Development Charges Pickering $236,839 Ajax $1,736,414

Whitby $884,650 Oshawa 288,000

Total $3,145,903

The balances in these reserve funds are modified on a regular basis, as a result of revenue collections and expenditure draws/commitments; however, this infonnation provides a point in time snapshot of their magnitude.

With respect to the funding of capital needs, the municipalities themselves are again the main source of funds. Some funding from other sources has been made available to the municipalities as a result of the allocation of funding from the Regional Transit Fund and the Province of Ontario's programs relating to bus renewal and replacement (MTO's Transit Renewal Program) which provided for one-third of the cost of replacement vehicles. The Transit Renewal Program has now been replaced by the Ontario Transit Vehicle Program and the Dedicated Gas Tax Funds for Public Transportation Program. The status of TRP as a separate and distinct program is uncertain and as a result, future funding is not guaranteed.

3.4.2.1 Conventional Transit Fares

Table 3.6 provides a summary of transit fares currently in place within each of the municipalities where conventional transit is provided:

As can be noted, there are differences between fares in each community. The most significant different in fare structure exists for an individual fare and monthly pass for seniors. APT A currently has significantly lower fares for senior transit users.

A common fare agreement exists between Whitby Transit and Oshawa Transit Commission. Whitby also has agreements in place with GO Transit to allow Whitby Transit pass holders or ticket/transfer holders to travel on GO Bus Services at no additional charge within Whitby, or pay an additional $1.00 to a GO bus driver and travel to or from Ajax along Dundas Street (Hwy #2) on GO Bus Service. Similarly, a connection from the Brooklin, Myrtle or Myrtle Station can be made for $2.00 on the GO Bus with a valid Whitby Transit Pass or Ticket.

GO Transit has agreements with each municipality for transfers between local transit and GO Rail services. A 50 cent co-fare of $20 monthly pass is paid by patrons travelling on a local bus with a GO Rail pass.

Aside from the noted fare agreements, inter-municipal travel across the Region can also be accommodated by linking to GO services and paying for a recently initiated Durham D-Pass ($25 on top of a monthly GO pass) thereby allowing unlimited access to local transit services throughout the Region. This pilot project is funded by the Regional Transit Fund.

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Business Case Analysis for rhe Porenrial Transfer of Lower-Tier Municipal Transir Services ro rhe Regional Mlinicipaliry of Dlirham Ocrober 2004

CASH FARES Adults Student (Full-Time) Seniors (65 or 55) Years Activity Card) Children (5 Years and Elementary School)

Table 3.6 Current Transit Fares

Whitby

$ 2.00 $ 1.75·

& Senior Centre $ 1.25

Older Attending $ 1.25

Oshawa

$ 2.00 $ 1.75

$ 1.25 $ 1.25

Children [Under 5 Years Accompanied by a Fare- Free N/A ($1.25) Paying Adult (Max. 3)] GO Transit Fare Connection $ 0.50 $0.50 MONTHLY PASSES Adult $69.00 $70.00 Students (Unlimited Use) $60.00 $62.00 Students (Restricted to School Days Only) $50.00 NIN Seniors $40.00 $42.00 Children $40.00 $42.00 GO Train Co-Fare $20.00 $20.00 TICKETS Adults (Sheet of 10) . $20.00 $19.00 Students (Sheet of 10) $17.50 $16.75 Seniors (Sheet of 10) N/A $11.85 Children (Sheet of 10) N/A $11.85 ~ 1 Child is defmed as toddlers to Grade 8.

Clarington Ajax/

Pickering

$ 2.00 $ 1.95 $ 1.75 $ 1.60

Age 60 + $ 1.25 $ 0.90 $ 1.25 $ 1.15

N/A ($1.25) Free

$ 0.50 $ 0.50

$70.00 $65.00 $62.00 $55.00 $50.00 $45.00 $42.00 $20.00 $42.00 N/A $20.00 $20.00

$19.00 $19.00 $16.75 $16.00 $11.85 $ 9.00 $11.85 12 @$13.20

2 School Board(s) purchase passes directly from aTe. Pass not available for purchase by general public. OTC currently offers bulk discounted price of$38.50 to school board.

3.4.2.2 GO Transit Fares - Northern Municipalities

The adult one-way fare on the Highway 12 service ranges from $7.75 to travel from Beaverton (Brock Township) to the Whitby GO Station, $6.60 from SunderlandiCannington (Brock Township) to the same destination or $4.15 from Port Perry (Scugog) to the Whitby GO Station. Uxbridge has GO Train-Meet bus service available to the Stouffville GO Train station via Goodwood that costs $3.90 for an adult one­way fare.

3.4.2.3 Durham College/uOIT Student Fares

A Durham CollegefUOIT Student Transit Pass costs $75/month and allows unlimited travel on all local transit services within Durham Region, including the APTA #101 cross-boundary service. In addition to local transit services in the southern urban municipalities, passholders are also able to ride existing connecting GO Bus routes to Bowmanville and Newcastle (along Highway 2) in the Municipality of Clarington and to Port Perry in the Township of Scugog along Highway 12.

Patrons other than students can travel on the APTA #101 route by paying the following cash fares: adult -$3.00; student - $3.00; senior - $l.50; and child (6- 12 years) $1.50.

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Business Case Analysis for the Potell/ial Transfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

3.4.3 Specialized Transit

3.4.3.1 APTA Specialized Services

APTA specialized services are funded by the municipalities of Pickering and Ajax as part of the overall APT A program

3.4.3.2 Handi Transit Incorporated

Handi Transit obtains its operating and capital funds through several sources:

• Grants from the municipalities of Whitby, Oshawa, Clarington, Scugog and Uxbridge; • Funds provided from Lakeridge Health for the transport of patients to dialysis treatment; and • Funds provided through the City of Oshawa for the transport of Canadian National Institute for the

Blind members.

3.4.3.3 Brock Community Care

Specialized transit service in the Township of Brock is provided by Community Care with funding from the local municipality.

3.4.3.4 Cost of Specialized Transit Service

Table 3.7 below provides a summary of the budgeted costs to each municipality for the provision of specialized services to their residents. This infonnation was extracted from budget infonnation provided by the appropriate service providers. Expenditure for specialized transit is based on actual budgeted revenues and expenditures for APTA Para-Transit and 2004 Handi Transit budgets for Oshawa, Whitby, Clarington, Scugog and Uxbridge.

Table 3.7: Costs of Specialized Transit in Durham Region Municipality Expenditure

Oshawa $486,000 Whitby $252,000 Clarington $137,000 APTA (includes indirect costs of $35,000) $676,000 Scugog - Uxbridge $66,000 Brock Township donation to Brock Community Carel $6,000

Total $1,623,000 Note: IBrock Township cost is donation only. Does not represent full cost of community bus service

3.4.3.5 Specialized Transit Fares

Within Ajax/Pickering, fares for those requiring the use of specialized service are equivalent to the conventional fares charged by APT A when travelling within the boundaries of the two municipalities ($1.95). When travelling outside the boundaries of Ajax and Pickering, a premium of$3.90 is charged.

For services provided by Handi Transit, fares are charged on a fare-by-distance basis. Fares range from $2.50 to $20.00, depending on the distance.

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Business Case Analysis for the Potential Transfer of Lower- Tier Mllnicipal Transit Services to the Regional MzmicipaliO; of Dllrham October 2004

3.5 Summary

Conventional transit services are currently provided only in the urban areas within Durham. It is clear that under the current structure where the local municipalities are responsible for service, conventional service within Scugog, Brock and Uxbridge will not occur in the foreseeable future. The only service available in the three northern municipalities is provided by GO Transit.

Due to the challenging economic environments that each local transit system operates within, the focus of many municipalities is on cost-control at the expense of service enhancement. This makes it a challenge for local service providers to expand services to provide a competitive alternative to the automobile.

Inter-municipal conventional travel by transit within Durham is possible only along Highway 2 or on the Lakeshore Rail Corridor. The current fare structures across the Region act as a significant disincentive for increases in inter-municipal travel on. public transit by Durham residents.

Specialized transit is a critical service for residents of Durham and, with an aging population, such services will become even more critical. Although not to the same extent as conventional services, travel by specialized service between municipalities is difficult and expensive. Although service is available in the northern communities, its availability is limited.

There is pressure within the community for conventional and specialized transit fares to be equal. This recognizes the need to treat all sectors of society on an equal basis.

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Business Case Analysisfor Ihe Potential Transfer of Lower-Tier Municipal Transil Services 10 Ihe Regional Mllnicipalil)' of Durham October 2004

4 LESSONS LEARNED FROM OTHER JURISDICTIONS The integration of transit services has occurred in a number of other jurisdictions over the last several years. It was considered appropriate, and indeed prudent, to review the rationale behind the amalgamation of services in other areas, the process that was followed, and the lessons learned. This chapter deals with two amalgamation processes that have recently occurred in the Region of Waterloo and the Region of York. This chapter also identifies some of the lessons learned from the processes in York and Waterloo.

4.1 Scope of Review

To gain an improved understanding of the advantages and disadvantages of an integrated transit system, a review of York Region Transit and Grand River Transit (servicing the Waterloo Region) was undertaken. The lessons learned from amalgamation of local transit services in York and Waterloo were considered to be particularly relevant to the Durham context given the similarities of the municipalities and systems and the recent timing of the events. The assessment included a review of the applicability of the chosen operational and organizational strategies and frameworks established by these agencies to the Region of Durham.

A Workshop was held on June 28, 2004 with staff from York and Waterloo regions to discuss "Best Practices" and lessons learned relating to the integration of conventional and specialized services.

4.2 BACKGROUND

4.2.1 Grand River Transit

On June 23, 1999, Waterloo Regional Council approved the assumption on January 1, 2000 of the conventional transit services and specialized transit services within Waterloo Region. A Project Team consisting of staff from Cambridge Transit, Kitchener Transit, City of Waterloo, Project Lift and Region of Waterloo was established to guide the transition process. A new Regional transit organization was established for implementation of a Regional Transit system in January 2000.

The transition planning included: • Design and application of logos to buses, bus stop signs and transit buildings; • Development of new schedules, route maps, newsletters and website; • Renumbering of routes in Cambridge; • Harmonization of fare structure; • Minimum 60 minute transfer policy; and • Introduction of new communication systems.

Grand River Transit (GRT) developed a monitoring program consisting of various performance measures and targets developed for Regional transit. These measures included, but were not limited to: • Service Quality measures - schedule adherence, actual vs. scheduled service, service interruptions,

transfer rate, etc; • Productivity measures - scheduling efficiency, employee attendance, system productivity, etc; • Effective measures - utilization of transit service, revenue performance.

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Business Case Analysisfor the Potential Trnl1sfer of Lower-Tier MZlIlicipal Trnnsit Services to the Regional Municipality of Durham October 2004

The Region also achieved fare integration and common operational policies and practices for specialized transit services in Waterloo. These services are operated by four different operators, with the Region providing the funding for the services.

4.2.2 York Region Transit

On September 14 2000, the Council of the Regional Municipality of York assumed the power for provision of public transportation services and facilities for all area municipalities. York Region Transit (YRT) was formed effective January 1, 2001. Prior to amalgamation, transit was provided in York Region by the area municipalities and GO Transit.

Transit is now provided by YRT and contracted out to three (3) different service providers. York Region Transit has also taken over GO Transit's Yonge and Bayview lines and through senior level government subsidies, is initiating a Rapid Transit system through the Region. Through amalgamation, York Region was able to provide improved service to the northern municipalities.

YRT amalgamated its specialized services for persons with disabilities on January 1, 2001. York Region has set investment targets to ensure the quality of service delivery.

4.3 Service Standards

A comparison of service standards developed by GRT and YRT was undertaken to assess relevance for application to Durham. The following aspects were reviewed:

Service related: • Area of Service (geographic coverage) • Service Coverage (walking distance to bus

stop) • Service Hours • Frequency of Service

• Passenger Loading

• School Services

• Directness of Routing

• Schedule Adherence

Fleet and Facility related: • Average Fleet Age • Transfers • Demonstration

• Bus Shelters

Financial considerations and targets: • System Cost Recovery to Target RIC ratio • Individual Route Cost Recovery Target • Fare Structure

Short and Long term strategies: • Annual Route Review • Service Expansion • Staging of Expansion • Duration of Service

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

Lessons Learned: Both York and Waterloo recognized the importance of enhancing the existing service standards to achieve stated goals for transit mode split established in their respective policy documents (OP, TMP). Both also recognized that the standards would require a number of years to implement as there are significant implications for both operating and capital budgets.

The YRT and GRT service standards were compared to those currently in use by local transit operators in Durham and used as a benchmark in developing a set of standards appropriate to Durham under an amalgamated framework. More details are provided in Chapter 6.

4.4 Financial Opportunities and Constraints

Grand River Transit instituted an area tax rate system, where tax levels are based on the service received. The financial performance and service distribution is re-evaluated each year. The area tax rate system is calculated based upon relative shares of revenue hours.

York Region had sufficient growth in assessment rates to fund transit within its current budget. Regional taxes did not increase at the initiation of regional transit. The net cost of operations is allocated on the Regional portion of the property tax bill.

Lessons Learned: Both Waterloo and York are similar to Durham Region in urban/rural land use composition. In determining an appropriate taxation approach each selected differing methodologies for allocation of regional tax levies. Also recognized was the importance of applying a fair taxation formula that was linked to existing and planned transit service levels in the various communities. Each also had a mechanism for change, reflecting the plans to introduce and enhance transit services across the regions.

In Durham the regional tax levies for other services are generally charged uniformly as opposed to being based on level of service. While this may be the most straight forward approach to apply to transit tax levies, and consistency in taxation would be maintained, it is also quite evident that the rural areas have serious concerns about receiving fair and equitable treatment and have an expectation that the Region will apply equitable taxation formulae that reflect the disparity of transit service provided across the Region.

4.5 Asset Transfer Strategies

Waterloo Region adopted the Cumming Principle for transfer of transit assets from the local municipalities to the Regional municipality. The Principle implies that all municipal facilities and equipment (arenas, community centres, fire halls, public works yards, office and administrative equipment, etc.) and all rolling stock (fire trucks and equipment, public works trucks, graders, snow ploughs, etc) in each existing municipality will become the property of the newly formed municipality without compensation.

All transit assets were transferred to the Region at no cost with the exception of portions of buildings that were not being used for transit. The Region compensated the local municipalities for the transfer of these "portions" of buildings. Waterloo Region failed to recognize all costs in their initial assessment (such as litter removal, phone system upgrade, provision of a common fare structure and maintenance contracts), and had to make necessary budgetary adjustments when a more thorough accounting was completed.

York Region paid the depreciated cost of the assets, minus the provincial funding received by the municipality from the province that the lower tier municipalities had paid for when transferring service to

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Business Case Analysis for the Potel1lial Transfer of Lower- Tier Municipal Transit Serl'ices to the Regional Municipality of Durham October 2004

the Region. York Region then approached the Provincial Government for a Provincial Sales Tax (PST) exemption on the value of the depreciated assets.

The Cumming Principle is based on the concept that municipal assets are paid for by taxpayers, and the same taxpayers should not pay twice for the same asset.

Lessons Learned: Based on this review, it is recommended that the Region of Durham, adopt the "Cumming Principle" for the potential transfer of transit assets, with the possible exception of joint use assets (such as portions of buildings currently being used for functions other than transit, i.e. retail, other municipal functions) that will require other compensation arrangements (e.g. purchase or lease). A detailed valuation of assets is recommended during the transition phase to establish principles for such unique arrangements.

4.6 Management, Organization/Governance

Grand River Transit was integrated into the existing Regional structure across broad functional departments in a decentralized organizational model. Five out of six departments at the Region of Waterloo now have a direct involvement with the regional transit organization. The Engineering Department is responsible for day-to-day operations, scheduling and maintenance. Within the Engineering Department, the Director of Transit Services directs transit fleet, transit operations and customer service.

The Planning and Culture Department is responsible for Transportation Demand Management, intermediate and long term planning and transit/land use connections. Within the Planning and Culture Department, the Director of Transportation Planning directs transit development, corridor management and a senior transportation engineer.

The Finance Department is responsible for:

• Purchasing; • BudgetslFinancial Services; • Cash and Fare Revenue Control; • Accounts Payable; and • Payroll.

The Corporate Resources Department IS responsible for maintenance of buildings, facilities administration and information systems.

The Community Health Department is responsible for med-lift management (specialized services).

All Transit management/non-union employees were transferred to the Region of Waterloo in the creation of Grand River Transit. The new management team worked with other Transit staff to develop work processes and configure roles and responsibilities to support the approved organizational structure. The chosen management team was involved with the transition to Regional Transit and helped to manage "change" for other employees, including unionized staff. No jobs were lost in the transition. Economies of scale are expected in the long term.

y ork R~gion Transit considered a Transit Commission for the governance of Regional Transit but elected to assimilate transit into a Regional department to avoid the changes to provincial legislation required to

Page 32

Business Case Analysis for the POlential Transfer of Lower- Tier Municipal Transit Services 10 the Regional Municipality of Durham October 2004

create a new commISSIon. The transit is centralized in comparison to GRT, with the following functions resident in Transportation and Works:

• Marketing & Customer Service; • Service Planning; • Operations; • Specialized Services; and • Administration.

The General Manager of 'Transit reports to the Commissioner of Transportation and Works. Five departments/managers report to the General Manager of Transit.

York Region Transit outsources conventional transit services to private contractors. Remaining transit employees from local municipalities were transferred to the Region of York. These staff continued to work at their respective locations until a Regional Transit department was established at the Region. The unified transit position within the Region strengthened YRT's negotiating position with senior levels of government.

LessollS Leamed: There are merits to both models, a multi disciplinary approach (GRT) and a departmental approach (YRT). The appropriate model for a particular organization is strongly linked to the existing organizational, cultural and collective bargaining framework. Each municipality has a unique management structure and departmental linkages, and the differences affect the direction taken. For Durham Region, decentralization of functions would be an issue where comparable staff positions (mechanics for example) from differing collective bargaining units are brought together within the same department.

To avoid that situation, a more centralized management framework is recommended. The details of the assessment and recommendations are provided in Section 12.3.

4.7 Human Resources

A Transit Human Resources (HR) Sub-Committee was formed during the transItIon to Grand River Transit. This Committee set out general direction, monitored progress and summarized key HR issues. Six HR Transit Transition teams were formed to address specific areas. These "teams" were established for the following major HR functions:

• Payroll/Human Resources Information Systems - development of a transitional plan, that established a Regional transit payroll system;

• Benefits/Salary AdministrationlRecruitrnent - documentation of all benefit packages and recommend appropriate course of action to resolve differences as well as development of a transition plan for Benefit, Salary Administration and Recruitment issues;

• Labour Relations - identification of union issues involved in the transition, development of a transition plan that addresses the Labour Relations issues that have been identified, and examination of collective agreements to determine any conflicts;

• Health & Safety/wSIB/Training - development of plan for critical issues (to be resolved prior to amalgamation), and a development of plan for remaining Health, Safety, WSIB and Training Issues;

• Employee Communication - development of an Employee Orientation plan for issues that must be addressed as part of the transition; and

Page 33

Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

• Records Management - development of a transition plan for Records Management issues that must be addressed as part of the transition.

Grand River Transit made a commitment to meet with each employee that would be impacted by the amalgamation. An Orientation Session was held that included a tour of GRT, information session about Regional Government and filling out of Employee Benefits documentation.

Transit in York Region operated under private contracts for service delivery. In addition there were 40 employees at local municipalities performing transit management, planning specialized services and administrative functions. To develop a Labour Management Structure, an outside firm was brought in to create job descriptions for the new YRT. CUPE represented most of the employees. There were no job losses related to transit.

York Region Transit held regular meetings and Question and Answer Sessions with transit staff throughout the transition process.

Lessons Leamed: Appropriate management and handling of human resource issues are potentially the most important aspects of the amalgamation planning and transition process. Both YRT and GRT placed strong emphasis on HR and cautioned Durham Region not to underestimate its importance of the time and effort required to successfully deal with resolution of these issues.

It is recommended that the Region of Durham follow a similar practice as the Region of Waterloo by developing a Human Resources implementation plan to deal with employeellabour issues, if the decision is made to move towards an integrated transit system. Use of outside assistance is also recommended to support HR staff in developing and implementing the program.

4.8 Implementation Opportunities and Strategies

Through consultation with employees of YRT and GRT, the following lessons were learned relating to implementation:

• Proper planning and organization for the implementation is key. An internal committee representing the functional areas is necessary to coordinate and execute the change;

• No significant service changes are recommended on Day I of operation to avoid potential for confusion of the public, potential for service disruptions and unnecessary additional transition costs;

• A MarketinglPublic Outreach Plan and branding of transit vehicles is important to announcing the amalgamation and transfer of transit to the Region. The plan requires a centralized telephone system and web site to disseminate transit route, schedule and fare information;

• Fare integration of all municipalities is key to create a seamless transit system; and • Harmonization of service standards is an important element of uniform transit delivery across the

Region.

Lessons Leamed: A smooth transition is important to demonstrate the wisdom of transferring the services to the Region. Dedication of adequate resources is required to properly plan and execute the introduction.

It is recommended that initial Regional Transit start-up costs, if applicable, should be minimized to avoid the threat of bad press and public resentment.

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Business Case Analysisfor the Po/ell/ial Transfer of Lower-Tier Municipal Transi/ Services /0 the Regional MUllicipali/), of Durham Dc/ober 2004

4.9 Summary

Although there are some significant differences between what the Regions of Waterloo and York have done with respect to transit amalgamation in Durham, there are some similarities, and in particular, many of the issues faced by York and Waterloo are relevant to the Region of Durham. In the case of both the Regions of York and Durham, a triple majority at Regional Council was obtained prior to the undertaking of any fonn of business case or financial analysis. It should be pointed out however, that in the Region of York, a number of previous studies had been undertaken to review the issue of transit amalgamation.

Certainly, one of the most important lessons learned from the York and Waterloo amalgamation experience was that the entire process is extremely complex and due diligence is required to understand all of the issues and nuances surrounding the issues of transit operations and financing, human resources, legal, assets and asset management, etc. In both Regions, a number of the issues continue to be addressed although both systems appear to be growing and achieving their goals of increased transit service and ridership within the community.

In both the York and Waterloo cases, the justification for amalgamating transit services was to build upon the pre-existing local services, provide transit amenities to currently underserviced areas and facilitate development of a mode of transportation that could ultimately compete with the automobile for some trips within the community. Despite increases in ridership, as of July 2004, ridership on the York Region transit system has increased by 46.2% over the same period in 2003. Much of the increase over the last year has been as a result of bus routes acquired from GO Transit in 2003, although approximately 12% of the growth can be attributed to other routes within the system.

Both the York and Waterloo systems have realized a decrease in their revenue to capacity ratio (RIC), primarily as a result of added routes and increased services. Growth in ridership has not been accompanied by a commensurate increase in RIC ratios previously experienced by the local operators.

YRT's RIC ratio was 65% prior to amalgamation and dropped to 42%. York is currently aiming for 50% RIC ratio, but would like to eventually achieve 60%. Prior to amalgamation, GRT's RIC was 56%. After instituting improvements, following amalgamation, the RIC dropped to 45%.

Given the different approaches taken towards various aspects of the amalgamation process, there is no one model that can be used to create an integrated transit network. It is however, clear that the objectives of both York and Waterloo were similar and that was to create a transit service that provided enhanced levels of inter-municipal and inter-regional transit for the residents while continuing to build local service within each municipality.

4.10 Part A Conclusions

An examination of the key public documents revealed a number of themes regarding the provision of trallsit in urban, suburball and rural communities. It is recommended that these themes should be considered as part of the review of transit services in the Region of Durham:

• The benefits of transit go well beyond health and environmental considerations. In fact, transit has a wealth of economic benefits;

• Transit has more "value" to the community than the individual components of the network; • Transit cannot be valued simply by the components of the network, and is also more than the ratio of

the cost to provide the service relative to the revenues generated from its operation;

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Business Case Analysis for the Potell/ial Transfer of Lower-Tier Mllnicipal Transit Services to the Regional Mllnicipality of Durham October 2004

• Transit is more effective when operated as part of an integrated network that provides choice for users;

• Federal and provincial government policy statements place a high priority on the importance of public transit. New investment models are being explored by both levels of government;

• A viable and integrated public transit system will be one of the keys to reducing auto dependency in the future and achieving more compact forms of urban development;

• More attractive service and integrated market share for transit are essential elements to increasing ridership;

• The intrinsic benefits of public transit although difficult to quantify, should be considered in the context of the evaluation of any new services; and

• The Business Case for public transit must not only include an assessment of costs and revenues but must be linked to other issues and benefits such as community wellness.

The following lessons were learned from past experiences of similar jurisdictions regarding the integration of transit:

• Adoption of the "Cumming Principle" for the potential transfer of transit assets; • Proactive development of a Human Resources Implementation Plan to deal with employeellabour

issues associated with the integration of transit; and • Development of a Communications Plan to effectively disseminate information to transit employees

and the public regarding the transition and implementation process.

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Bllsiness Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Sen'ices to the Regional Municipality of Durham October 2004

B. A Vision for Transit in Durham

5 TRANSIT VISION/OBJECTIVES This Part of the report provides a summary of transportation and transit visions and also provides a detailed list of goals and objectives for future transit services within Durham.

5.1 Demand for Future Transit Services

Durham Region's policies relating to transportation are described in detail in Chapter 2. Excerpts of that description are repeated below.

The Community Strategic Plan (CSP) outlines a number of objectives including "the strengthening and integration of the transportation system within the Region". Specifically with respect to transit, the CSP sets as the objective the creation of a viable, affordable, and integrated transit system, which will facilitate the movement of the Region's residents between communities within the Region and beyond, and reduce the congestion on the Region's roads?

Within the context of both the ROP and the CSP, the Transportation Master Plan (TMP) recognizes that an efficient and effective public transportation network is critical to the long-term economic, environmental, and community sustainability of the Region. The TMP recommended that public transit services should:

• Meet the basic mobility needs of people who have no other travel alternatives through a base level of service, at reasonable cost;

• Offer a viable and competitive alternative to the private automobile during peak periods of travel in high demand corridors; and

• Expand the carrying capacity of the transportation system.

The TMP defined a Transit Priority and Bus Rapid Transit (BRT) network for the Region. The Transit Priority Network is based, in part, on current and anticipated transit usage, future travel demands, and the land use plans and policies contained in the Region's OP. It combines the key elements of the GO Transit Commuter Rail System with priority measures to be implemented on arterial roads and freeways. The TMP also took into consideration the location of both existing and planned GO Transit bus routes and stations, existing transit designations contained in the ROP, and the BRT proposals outlined in the GO Transit Long-Term Capital Strategy. Also identified in the TMP were strategic targets for reduced auto travel and increased transit use.

Total afternoon peak period travel demand in the Region is expected to grow from 285,000 person trips in 2001 to about 552,000 person trips in 2021. This increase of 94% is greater than the popUlation growth of 61 % over the same period, and is a reflection of the considerable growth in employment anticipated. Nearly 60,000 peak period automobile driver trips would be diverted to other modes of travel through the implementation of the strategies identified in the TMP. Achieving this target will more than double the number of transit trips that would have occurred in the year 2021 without this change in travel behaviour, and increase transit ridership by approximately 450% from current levels. This dramatic increase requires major improvements to the current service levels provided by the local transit operations in Durham.

The TMP recognized the needs of the Region's rural communities for public transit were best met through the provision of demand-responsive Dial-A-Ride and charter type services. Such services fill the niche between private and public transportation, and utilize equipment suited to the level of demand. Similarly,

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional MUllicipality of Durham October 2004

the 1MP recognized that there was a need for specialized transportation services to meet the needs of the disabled. Both Handi Transit Inc. and APT A currently provide these services, and the 1MP suggested that they be integrated to serve the whole of Durham Region.

The Transit Improvement Plan (TIP) considered both conventional and specialized transit on a region­wide basis, and identified potentially significant benefits that would accrue from further amalgamation of services within the Region. The TIP provided a range of recommendations relating to service enhancements to local, inter-municipal, and inter-regional transit services, including enhanced level of service guidelines and enhanced GO services through Durham Region. Service enhancements, such as harmonized service standards between APTA and Handi Transit Inc., were recommended for specialized services within the Region, and it was also recommended that a rural para-transit service be planned and implemented in the longer-term.

In summary, transit is recognized as a cornerstone in accommodating increasing travel demands associated with forecasted population and employment growth in the Region in an environmentally responsible way. Chapter 7 describes the need and rationale for integrated services in Durham and describes in detail future travel demands, transit mode shares, the requirement for improved intra­municipal and inter-regional transit service enhancements and the need to introduce transit into developing areas of the Region that are currently unserved.

5.2 Transportation Vision

The transportation vision for the Region, as adopted by the Council of the Region of Durham, IS

embodied in the Region's Transportation Master Plan and is defined as follows.

By the year 2021:

The transportation system for the Region of Durham is integrated and balanced, using a range of transportation strategies to address the mobility and goods movement requirements of the entire community, to sustain investment in industry, agriculture and tourism, to maintain community "weI/ness ", and to integrate with the environment.

The auto continues to be the dominant mode of transportation, however, the community has realized a shift towards greater use of transit, pedestrian and cyclingfacilities.

The changes in modal usage have been accomplished by increased urban densities, mixed use development, policies that encourage reduced auto use, higher order transit facilities linking centres within Durham and other urbanized areas in the GTA and improved integration of the various modes of transportation.

The necessary funding available from all levels of government has been put in place and all possible opportunities for private sector funding to achieve the improvements necessary to ensure a livable community have been investigated.

5.3 Transit Vision

The transit vision for the Region of Durham reflects the overall transportation vision for the Region and embodies the concept of sustainable development ("development that meets the needs of the present

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

without compromising the ability of future generations to meet their own needs")). It also reflects community sentiment regarding transit as articulated through a public survey conducted in conjunction with the development of the Region's Transportation Master Plan. The transit vision builds upon the policies of the Regional Official Plan and captures the essence of the Region of Durham Community Strategic Plan. The vision also is consistent with the principles and objectives embodied in the draft Places to Grow document recently released by the Province of Ontario.

The transit vision is described as follows:

By the year 2021:

The transportation system in Durham includes an integrated transit network that provides a safe and competitive alternative to the automobile for travel within and through the Region of Durham. 17ze transit infrastructure affords seamless linkages to all areas within the Region and connections to other communities and systems. Transit service is unimpeded by jurisdictional boundaries or intermodal barriers. 17ze service is frequent on key routes and competitive travel times for inter and intra-municipal travel encourage reduced use of auto travel, particularly in the urban areas. The cost of travel by transit is also competitive with automobile travel for similar trips.

Transit in Durham is characterized by a network and vehicles that offer access to transit services for all sectors of the community including those requiring the use of specialized services.

The system is affordable and reliable, is client and customer focused and is managed efficiently and cost­effectively. Transit is considered explicitly in the planning, design and implementation of new commercial and residential developments, subdivisions, roads and other municipal, provincial and federal infrastructure. Planning for transportation infrastructure, whether new facilities or rehabilitation/widening of existing facilities, recognizes the unique needs of the transit component of the travel market while ensuring that facility design and operation does not affect the cost and travel times for goods movement.

Transportation service for the disabled meets the requirements of the Ontario Disabilities Act and is seamless, customer-focused and cost-effective for the users and operators. Specialized services are flexible to adapt to changes in demand recognizing the aging population within the Region, and unique travel demands of this group. The frequency and level of service provided for specialized transit services are comparable to that of conventional transit as are the fares for patrons.

The necessary funding available from all levels of government has been put in place to maintain and operate the system in accordance with desired service standards and all possible opportunities for private sector funding to achieve the improvements necessary to ensure a livable community have been investigated.

Managing, improving and expanding the system to satisfY public demand has become a priority for the community. Decisions on investment in transit service and infrastructure expansion are made on the basis of maintaining community welbless, environmental sustainability and are aimed at achieving a reduction in the levels of ownership and use of the private automobile within the Region.

) Sustainable Transportation - The Canadian Context Transport Canada, 2001 (Prepared for the Ninth Session of the United Nations Commission on Sustainable Development)

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of DlIrham October 2004

5.4 GOALS AND OBJECTIVES

To achieve the Region's Transit Vision, the following goals and objectives must be satisfied for both specialized and conventional transit services. These goals and objectives reflect the Region's Community Development Strategies, and the Transportation and Transit Directions that the Region has endorsed. They also reflect the renewed emphasis on public transit emanating from the federal and provincial governments. These goals and objectives have been developed upon consideration of the following:

• Provincial, federal, local and Regional policy documents; • Themes flowing from the above policy documents; and • The Transportation and'Transit Vision.

Goal A: Provide an Integrated Transit Network • Provide both conventional and specialized servIces that overcome jurisdictional boundaries or

intermodal barriers; • Provide enhanced opportunities for increased inter-municipal, and intra-regional travel by transit on

key north-south and east-west links; • Provide enhanced opportunities for increased inter-regional travel by transit on key east-west and

north-south links; • Link decisions on transit within the Region to the Province's growth management plans; • Transit service improvements that contribute to the expansion of the carrying capacity of the

transportation system; • Improve access by transit to major trip generators and attractors from all areas within the Region,

including hospitals, Durham College and VOlT, and major employment and retail centres; • Plan routes and services in a regional context and in concert with land-use decisions; • Maximize opportunities and facilitate planning for higher order transit service in the future through

relevant land-use and transportation policy and investment decisions; • Recognize the importance of the GO Transit rail and bus services to an integrated transit network in

the Region; and • Provide enhanced integration with GO Transit bus and rail services.

Goal B: Provide Access/or all Areas and Sectors o/the Community • Facilitate development and enhancement of transit services in rural areas currently not serviced by

conventional transit; and • Facilitate seamless travel across the Region for patrons of specialized transit.

Goal C: Develop a System that is Affordable and Efficient • Facilitate more balanced investment in transportation infrastructure as a result of a reduction in the

growth of demand for automobile travel; • Measure the benefits of transit on the basis of community benefits, economic development and

environmental sustainability; • Facilitate development of regulatory, policy and financial tools to permit enhancement and expansion

of the transit system consistent with the Region's growth strategy plans; . • Develop a system that is capable of providing the necessary speed, reliability, comfort, frequency and

connectivity to all areas of the community in both urban and rural areas in order to be competitive with the automobile for some trips;

• Maximize the use of existing transit assets; • Maximize the efficiency of transit vehicles and vehicle productivity; • Encourage and facilitate the use of transit priority measures; • Facilitate the acquisition of funding from provincial/federal governments for capital and operational

requirements associated with the development and operation of an integrated transit system;

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Sen'ices to the Regional Municipality of Durham October 2004

• Maximize access to and use of funding from all sources through an integrated and unified approach to planning and service provision;

• Co-ordinate services with other public and private sector transit service providers within the Region and in other communities adjacent to Durham;

• Encourage predictable long term sustainable funding commitments from provincial/federal governments;

• Facilitate fare integration across the Region; • Reduce the cost of equipment acquisition and maintenance; • Provide value to residents; • Encourage and reward innovation in the planning and operation of the transit system; • Ensure adequate funding is directed at the maintenance and rehabilitation of existing servIces,

infrastructure and facilities; • Incorporate best practices for all aspects of planning and service delivery; • Employ technology strategies that best meet the prevailing demand; and • Generate reliable and long term revenue streams to fund transit thereby making possible more cost­

efficient capital investment programs.

Goal D: Facilitate the Development of a Livable and Envirollmentally Sustainable Community • Develop strategies aimed at achieving the Region's targets for reduced auto use within the

community; • Develop strategies aimed at achieving the Region's transit mode share objectives; • Facilitate achievement of the Regional Official Plan principles and plans regarding growth; • Assist in shaping growth in an orderly manner and in locations that will be "transit supportive"; • Reduce overall transportation energy consumption and resource depletion; • Reduce greenhouse gas emissions associated with transportation activities; • Using innovative and visionary marketing strategies directed at the general public and other stake

holders, create a "level playing field" so that when travel decisions are made by the public, they are based on consideration of real costs and affordability;

• Develop a system that supports a vibrant and diverse economy, walkable streets as well as a high quality of life; and

• Through integrated land use and transportation planning practices, develop policies and operational strategies that ensure access to transit for every segment of the community.

Goal E: Satisfy Public Demand and Client Needs • Provide service levels and networks that recognize demand for linkages to GO Transit (rail and bus)

and that serve school trips; • Develop strategies for monitoring service levels, ridership, revenues and public satisfaction regarding

the operation of the transportation and transit system; • Establish public input strategies to solicit input on the planning and operation of an integrated transit

network; • Provide choice in the selection of transportation mode for both local and long distance trips; and • Improve the quality and condition of vehicles.

5.5 CHALLENGES TO THE IMPLEMENTATION OF THE REGION'S TRANSIT VISION

Visions and goals, without resources, planning and programs that are fully supported by the responsible agency, are of little use. A strong vision and well-crafted goals, even if they have the highest level of political endorsement, will not result in the development of a viable and responsible transit system without the appropriate level of sustained resources and supporting policy measures. It is a lot easier for

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Business Case Analysis for the Potenrial Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

decision makers to endorse a vision and associated goals than actually making policy and investment decisions to support these ideas.

In order for Durham to realize its transit vision and achieve the goals established for the community, there will have to be a change in societal attitudes and also changes to institutional structures and paradigms regarding the planning, funding and operation of transit services. The Region of Durham Community Strategic Plan provides visionary direction relative to transit. The Plan along with the vision articulated in this paper, requires sustained support and innovative leadership to be effective and produce long term economic and environmental benefits.

With lack of funding being the major impediment in many cases to expansion of services in a meaningful way, the municipalities within Durham must co-operate to position themselves to change or influence the way transit is funded by the upper-tier levels of government and to ensure that Durham achieves its fair share of dedicated sustained transit funding.

5.6 Summary

There are numerous social and institutional barriers that must be recognized and overcome before a vision can become reality - particularly with respect to transit. In considering options for improving transit in Durham, prevailing institutional pressures and the realities of today's social environment, where the automobile has become institutionalized, must be overcome.

Transit is an important pillar of transportation visions developed by municipalities, provinces and states across North America (including Durham), however, it is still a reality that transit expenditures exceed revenues. In many jurisdictions, and despite the existence of socially and environmentally responsible vision statements, transit is still viewed by the decision-makers as a social service and not a viable transportation mode, as desired by the public. It is not unusual at a Municipal level that investment decisions relative to transit are being made on the basis of cost reduction and not transit productivity or environmental and social benefits, possibly because some of the benefits are not well understood.

The net operating costs of transit service are currently funded by the local municipalities from property tax revenues obtained from their constituents. Travel demand is not however, dictated by municipal boundaries. As a consequence, effectively matching the supply and demand for transit within Durham is a challenge constrained by jurisdictional responsibilities that may preclude a community investing in resources to serve the residents of an adjacent municipality.

In order for Durham to realize its transit vision and achieve the goals established for the community, there will have to be a change in societal attitudes and also changes to institutional structures and paradigms regarding the planning, funding and operation of transit services. The Region of Durham Community Strategic Plan provides visionary direction relative to transit. The Plan along with the vision articulated in this paper, requires sustained support and innovative leadership to be effective and produce long term economic and environmental benefits.

With funding being the major impediment in many cases to expansion of services in a meaningful way, the municipalities within Durham must co-operate to position themselves to change or influence the way transit is funded by the provincial/federal levels of government - and to ensure that Durham achieves its fair share of dedicated sustained transit funding.

Further demonstration of the need for transit integration in Durham Region is provided in Chapter 7 of this report.

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Business Case Analysis for the Potelltial Trallsfer of Lower- Tier Mllnicipal Transit Services to the Regional Mllnicipality of Durham October 2004

6 TRANSIT POLICIES AND SERVICE STANDARDS As with any service provided at a local or inter-municipal level, an effective service can only be delivered if the goals and objectives of the service are clearly articulated in an overall plan and reflected in performance standards that can be easily measured and monitored.

To provide a basic level of mobility within the transit service area, acceptable standards in terms of minimum service frequencies, hours of operation, and walking distances to bus stops for conventional services along with appropriate operating targets for specialized services needs to be established. While the minimum acceptable standards may change in the future, a reasonable starting point would be to adopt some combination of the standards now in place across the Region. These current standards are discussed and reviewed and minimum service standards are put forward. Also taken into account were service standards employed by the Regions of York and Waterloo when they amalgamated local services in their respective communities.

With respect to existing conventional services, some of the corridors in the urban areas already generate ridership levels, particularly in peak periods, which exceed the minimum level of service standard. The proposed minimum service standards must therefore also include appropriate performance measures that will govern how service will be added.

This chapter of the report provides a synopsis of existing and proposed service standards.

6.1 Existing and Proposed Service Standards

For conventional transit services, Table 6.1 compares the existing Oshawa Transit Commission (OTC) service standards with the suggested initial minimum service standards for integrated or unified services in Durham. These initial standards have been selected to facilitate development of an integrated system. They require only minor adjustments to the existing standards of AjaxlPickering Transit Authority (APTA), Whitby Transit (WT), and OTC. The service standards should adopted for the initial period of integration, however, will be subject to further review during the initial stages of implementation. It may also be more appropriate to adjust/modify these standards and/or add additional standards.

The standards identified in this document for both conventional and sp~cialized transit describe the minimum service standards that an integrated system should meet to satisfy its obligations to provide a basic level of mobility to regional residents within the transit service area. As indicated in Table 6.1, service frequencies above these minimums will be provided where the average hourly seated load is exceeded so long as the route revenue / cost ratio can be maintained at 30% or greater.

The standards also indicate that, in providing this level of mobility, it is expected that system operators will recover approximately 55% of the operating costs of conventional transit from its users and that it will control operating costs and set the fare levels accordingly. These standards and the revenue / cost targets apply to the provision of the basic level of mobility service within the transit service area. Table 6.1 also provides a summary of suggested service standards for specialized transit across the Region.

It is also recognized that these standards are desirable targets and will require a considerable time period to achieve. The rate of progress towards achieving the targets will be dependent upon costs and revenues, senior government funding, the status of the Regional Transit Fund, tax rates and formulae, etc. It should also be noted that there may be circumstances where decisions are made to implement routes or adjust service levels that do not meet the recommended service standards. Such service may be required to address underserviced areas or in attempt to improve accessibility to all areas of the Region.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Selvices to the Regional Municipality of Durham October 2004

Table 6.1- Current and Suggested Service Standards - Conventional and Specialized Transit Services

Service Coverage (Walking distance)

Service Hours:

FREQUENCY OF SERVICE:

• Peak

• Base

• Evening Sundays/

Advanced Booking Capability

Improvement

OTC Existing

400m 95% of urban area

N/A

maxunum IVQUllJ'5

exceeds the passenger loading standards, head ways will be reduced or extra buses will be introduced into the route to supplement the service

Integrated Conventional Transit

area.

Minunum 90 minutes in advance for Pickering Dial­

A-Bus service only

Specialized Transit

with base service as below

N/A

Minunum2 in advance (urgent medical) Up to 14 days in advance

• 150% capacity. for urban service

• 100% of seated capacity of inter-urban service

maxunum exceeds the passenger loading standards, headways will be reduced or extra buses will be introduced into the route to supplement the service

operated

A

A

A

ears 5-7 Years

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

OTC Existing Integrated Conventional Specialized Transit Transit

Bus Shelters Not Established Within 5 years of N/A implementation, 50% of all passengers should be able to board a bus at a sheltered stop

Standards: Financial

SYSTEM COST 60% 55% exclusive of capital 10%-15%

costs and TDM initiatives RECOVERY TO TARGET RIC RATIO

Individual route 65% Base Routes (M-S) 30% N/A cost recovery target 35% Local Routes (M-S)

25% Evenings and Sundays

Fare structure N/A • Fare integration • Fare integration • Fare structure will be • Variable depending

adjusted to recover 55% upon service of the system operating requirements. costs • Urban areas similar to

• Fare media will reflect conventional special strategic marketing rural fare structure objectives

Standards: Planning

ANNUAL Reviewed monthly • All transit routes with N/A minimum revenue/cost

ROUTE ratio of 0.30 will be REVIEW measured annually

Service expansion • New service area • F or each kilometre of • Based on overall should be greater than route being considered demand 400m from existing in a residential area, a services and must be minimum of2,100 adjacent to areas served people should live by transit within a 400m walk of

• For each kilometre of a proposed route route being considered • For each kilometre of in a residential area, a route being considered minimum of 2, 1 00 in an employment area, people should live a minimum of 750 within a 400m walk of people should work a proposed route within a 400m walk of

• For each kilometre of a proposed route route being considered in an employment area, a minimum 0[750 people should work within a 400m walk of a proposed route

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

OTC Existing Integrated Conventional Transit

Specialized Transit

STAGING OF EXPANSION

Duration of service demonstration

Not Available

Not Available

Standards: Performance l\lanagcmcnt

General

Schedule adherence

Key Performance Indicators (KPI)

Buses never operate ahead of schedule at identified time points or more than 3 minutes behind schedule 95% of the time

N/A Not ApplIcable

6.2 Summary

The first phase of service expansion will be during the weekday peak periods. Service will be increased dependent on maintaining utilization and cost recovery targets.

12 months.

AdoptKPI

Buses never operate ahead of schedule at identified time points or more than 3 minutes behind schedule 95% of the time

N/A

N/A

N/A

N/A

To provide a basic level of mobility within the Region, and to permit monitoring of route and system performance, it is important that a set of transit service standards be established for integrated transit service. These standards are desirable targets and will require a considerable time period to achieve. The rate of progress towards achieving the targets will be dependent upon costs and revenues, senior government funding, the status of the Regional Transit Fund, tax rates and formulae, etc. It should also be noted that there might be circumstances where decisions are made to implement routes or adjust service levels that do not meet the recommended service standards.

6.3 Part B Conclusions

In order for Durham to realize its transit vision and achieve the goals established for the community, there will have to be a change in societal attitudes and also changes to institutional structures and paradigms regarding the planning, funding and operation of transit services.

With lack of funding being the major impediment in many cases to expansion of transit services in a meaningful way, the municipalities within Durham must co-operate to position themselves to change or influence the way transit is funded by the upper-tier levels of government and to ensure that Durham achieves its fair share of dedicated sustained transit funding.

Initial service standards have been selected to facilitate development of an integrated system. Only minor adjustments to APT A, Whitby Transit and OTe are required. The standards may be adopted for an initial period of integration, but should be regularly reviewed and adjusted as necessary to ensure that they remain both financially feasible, technically defensible and be subject to ongoing review during the initial stages of implementation when it may also be appropriate to adjust/modify these standards and add additional standards.

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Business Case Analysis fo,. the Potential Transfe,. of Lowe,.- Tie,. Municipal Transit SenJices to the Regional Municipality of Du,.ham Octobe,. 2004

c. A New Approach to Transit in Durham Region

7 NEED AND RATIONALE FOR INTEGRATED TRANSIT IN DURHAM

Part B of this report - A Vision for Transit in Durham - suggested that by the year 2021, the transportation system in Durham will be comprised of an integrated transit network that provides a safe and competitive alternative to the automobile for travel within and through the Region of Durham. The key to this statement and the vision is the term "integrated". Today there is some co-operation between the local operators, althougli. it is still difficult from both a physical and fare perspective for residents to travel seamlessly between adjacent municipalities.

This part of the report deals with the development of the need and rationale for integrated transit services in Durham and builds upon the policies of the· Regional Official Plan and captures the essence of the Region of Durham Community Strategic Plan.

This chapter of the report offers an argument in support of expanded inter-municipal and inter-regional conventional and specialized services within Durham. It addresses the need and rationale in the context of goals previously articulated in response to the transit vision.

7.1 Integrated Transit

The future of public transit in Durham over the next two decades and beyond, lies in improved service levels, enhanced intra and inter-regional linkages leading to increased transit patronage and eventually higher order transit service for conventional services. With respect to specialized services, the future involves seamless travel for patrons of specialized service across the Region and a closer inter­relationship with conventional service.

Integrated transit service can be defined as a transit network/system that affords seamless (fares/transfers) linkages to all areas within the Region and provides connections to other communities and systems. Transit service in an integrated system is unimpeded by jurisdictional boundaries or intermodal barriers.

Currently, services within the Region are generally moving in the right direction with some municipalities co-operating in terms of fare agreements and service integration. However, the expansion of services is generally focused in the local municipal areas, and expenditures are certainly not keeping pace with the demand for public transit service, both at a conventional and specialized level. In addition to evidence that municipalities are co-operating in a meaningful manner, there is some level of integration between GO Transit and the local transit providers with respect to GO Rail. There is however, limited integration, particularly from the perspective of fares when it comes to local service and GO bus services on Highway 2 and Highway 12.

Combined with aggressive TDM strategies, integrated enhanced public transit within the Region will respond to the following:

• The need for improved seamless and cost-effective services across municipal boundaries; and • The need for improved seamless and cost-effective services across regional boundaries.

Other benefits that will accrue to the community as the result of a greater level of transit integration include, but are not limited to:

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Business Case Analysis for the Potelllial Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

• Fare integration allowing travel anywhere in the Region of Durham for a single fare; • Improved public perception and greater levels of public understanding when it comes to the provision

and availability of services; • Cost savings to users; • Time savings to users; • Societal and environmental benefits; • Achieving community and environmental standards; and • Achieving community mode share targets (as articulated in the TMP).

Integrated transit combined with improvements to other modes and the use of non-structural TDM strategies will assist the Region in achieving its growth aspirations.

In order to achieve integrated transit within the Region of Durham, a number of challenges must be overcome including:

• Ensuring investments are made with area wide objectives related to transportation and mobility; • Achieving consensus regarding investment strategies and service across a large geographical area

such as the Region of Durham; and • Ensuring transit provision at a level that provides opportunities for all sectors of the community,

including those living in both rural and urban areas and those requiring the use of specialized servIces.

This chapter deals with the need for and benefits of transit integration across the Region of Durham. The organizational and administrative structure required to best facilitate integrated transit in Durham is addressed later in this report.

7.2 Need and Rationale

Durham, not unlike many communities in the GTA and surrounding communities, is at a crossroad in its development - particularly from a transit perspective. Although population and employment growth continues to occur in the Region, it does so at a rate that is lower than predicted in transportation and planning studies conducted by the Region in the 1980s and 90s. Evidence suggests that growth in the Region has and will be affected by transportation and transit systems that are not well equipped to deal with the travel demands of a vibrant community, such as Durham.

In an environment such as Durham's, travel is often characterized by many inter-municipal and inter­regional trips. The current conventional transit services provided by the local municipalities within the urban areas, are challenged to accommodate overall demand. In this regard, the existing services as a competitor to the auto may be unsustainable as operated by the local municipalities, given their focus on revenue to cost ratios, managing assets and maximizing efficiencies in the implementation of those assets over local geographic areas. The current transit operators are facing increasing costs and declining market shares and the current service plans and government structures make it difficult to respond to emerging travel demands and customer expectations.

A number of municipalities within Durham are experiencing financial challenges that may well affect long term sustainable investment in transit. Each of the local operators have identified the need to acquire a number of new vehicles to replace an aging fleet. The vehicle replacement plan articulated by the local operators is not viable without significant increases in taxes or senior level funding, given historic spending on transit by the area municipalities/local operators.

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transil Services 10 Ihe Regional MUllicipalily of Durham October 2004

Table 7.1 summarizes forecasted year 2021 peak period travel demands (in person trips) based on the population and employment forecasts used in the TMP. Total afternoon peak period travel demand in the Region is expected to grow from 285,000 person trips in 2001 to about 552,000 person trips in 2021. This increase of 94% is greater than the population growth of 61 % over the same period, and is a reflection of the considerable growth in employment anticipated.

Table 7.1 also compares resulting modal shares for the 15% auto reduction target scenario (a 15% reduction in forecasted trips over the trend scenario at the 2021 planning horizon) and a forecast based on the continuance of current mode choice trends. The table shows that nearly 60,000 peak period automobile driver trips will be diverted to other modes of travel through the implementation of the strategies identified in the TMP. Achieving this 15% target will more than double the number of transit trips that would have occurred in the year 2021 and increased transit ridership by approximately 450% from current levels.

Table 7.1- Forecasted Peak Period Travel Demands and Mode Shares Mode Share Scenario Observed 2001 Forecast 2021 %

Mode Person Person Change

Trips % Trips % from 2001

to 2021 Auto Driver Based on Current Mode Share 205,600 72% 397,400 72% 93%

With 15% Reduction in Auto Driver Trips 337,800 61% 64% Decrease in Auto Driver Trips -59,600 -15%

Auto Passenger Based on current Mode Share 43,400 15% 82,800 15% 91% With 15% Reduction in Auto Driver Trips 84,900 15% 96% Increase in Auto Passenger Trips 2,100 3%

Transit Based on Current Mode Share 16,100 6% 33,100 6% 106% With 15% Reduction in Auto Driver Trips 88,300 16% 448% Increase in Transit Trips 55,200 167'Y"

Other Based on Current Mode Share 20,000 7% 38,600 7% 93% With 15% Reduction in Auto Driver Trips 40,900 7% 105% Increase in Other Trips 2,300 6%

TOTAL 285,100 551,900 94%

Notes: I. Source: Data Management Group, 2001 TIS Survey 2. "Transit includes GO Rail, bus and local bus routes 3. "Other" includes walk, cycle, school bus, motorcycle and taxi modes

The Region of Durham has committed to achieve the highest diversion of single automobile travel to other modes that is reasonably practical, given current travel habits and the present transportation system focus of serving the automobile. The Plan sets a target of reducing afternoon peak-period automobile driver trips by 15% compared to forecasts based on current trends. In achieving this 15% target by the year 2021, it is assumed that most drivers will divert to transit, although walking, cycling, ridesharing and work-at-home are all expected to increase over this period. A 15% auto reduction target is consistent with the objectives of other Canadian municipalities. The goal will be challenging to reach, but can be achieved through implementation of the strategies recommended in the TMP, such as:

• Designation and development of the Transit Priority Network; • Development of the Highway 2 corridor to a significant inter-municipal transit corridor; and • Work with GO Transit to expand services throughout Durham Region.

The tables below enumerate inter-municipal trips within Durham Region according to the Transportation Tomorrow Survey data from 1996. The data has been modeled to attain 2021 forecasts. This information illustrates the changes in transit mode share required within Durham to achieve a reduction in auto trips of 15%. Trips made external to Durham are not included in the following tables.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional MUllicipality of Durham October 2004

Table 7.2: Person Trips, AM Peak Period (1996) All Trips - AM Peak Period (1996)

Pickering Ajax Whitby Oshawa Clarington

Origin ,.: ."

Pickering 14,835 1,769 900 730 97

Ajax 2,856 13,297 1,133 1,288 117

Whitby 1,866 1,798 16,474 6,364 669

Oshawa 2,359 2,613 5,634 37,346 2,144

Clarington 966 945 2,219 5,668 11,801

Rural 537 176 554 1,445 303

Total 23,419 20,598 26,914 52,841 15,131

Table 7.3: Person Trips, AM Peak Period (2021) All Trips - AM Peak Period (2021)

Pickering Ajax Whitby Oshawa Clarington

Ie 'til,. t;(;lc~c:! ',.'I'j'''''1'~';~ ,/16 "PM:'"'''," '!'"i:'H";!:t"!;"'J,,~!':r"· ':>,:i 'i'J;j"'~?;\'1Dl\l'i ~~""'<""";:"

Pickering 26,776 5,986 2,868 1,919 749

Ajax 11,603 19,662 3,063 2,782 541

Whitby 8,911 5,630 27,255 12,260 3,306

Oshawa 9,729 6,981 16,488 64,658 10,115

Clarington 4,428 2,804 6,655 13,965 27,461

Rural 1,478 323 1,071 1,941 835

Total 62,925 41,386 57,400 97,525 43,007

Table 7.4 - Transit Trips, AM Peak (2021) Transit Trips

Rural Total " .. , , ':.

150 18,481

82 18,773

146 27,317

221 50,317

166 21,765

10,766 13,781

11,531 150,434

Rural Total

.',".>'"'''"''' ;;f;;it:~'~it\!~f'<l;J:, .

252 38,550

213 37,864

444 57,806

634 108,605

483 55,796

10,591 16,239

12,617 314,860

~----------------------------------------------------------~

Pickering Ajax Whitby Oshawa Clarington Rural Total

:':;:':/';;',;1,":'c"''' '7 ;.7 <;' • I';\' ,\ :~' 1:i;;:1,,~;),;,{ qr;:~iM:) :i~i:;;tY:: :iii'.,,: i'. i,:{ ','t',', ,;,:~;;~;~:\; Pickering 5,355 539 201 221 22 6,338

Ajax 754 3,932 214 391 16 5,308

Whitby 579 507 4,088 1,410 99 6,683

Oshawa 632 628 1,154 12,932 1,012 16,358

Clarington 288 252 466 1,397 4,119 6,522

Rural 96 29 75 223 25 448

Total 7,705 5,888 6,198 16,573 5,294 41,657

The above data shows that there is a high level of demand for travel between the municipalities along the lakeshore, in particular. There is also some demand, none of which is satisfied by transit, between the rural areas (northern communities) and the urban area, and in particular, Oshawa (GM, Durham CollegelUOIT and Lakeridge Health Oshawa). The above demand suggests the need for improved inter­municipal service between local municipalities in Durham.

To achieve the Region's vision for transportation and transit, there is a need for a fundamental change in the approach to providing transit. An integrated inter-municipal and inter-regional transit network for both conventional and specialized transit services, linked to the GO Transit network, is required to make

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Business Case Allalysis for the Po/ell/ial Trallsfer of Lower- Tier MUllicipal Trallsit Services to the Regiollal Municipality of Durham October 2004

Durham a dynamic economic centre within the GTA, and a contributing community within the Province of Ontario.

The net operating costs of transit service are currently funded by the local municipalities from property tax revenues obtained from their constituents. Travel demand is not, however, dictated by municipal boundaries. As a consequence, effectively matching the supply and demand for transit within Durham is constrained by jurisdictional responsibilities that preclude communities from investing in resources that could be perceived to serve the residents of an adjacent municipality.

History has shown that, €ven when inter-municipal or regional authorities have been established, achieving agreement on equitable funding and levels of service is often difficult with such fragmented decision-making. Further, achieving agreement on infrastructure and service enhancements can lag far behind the actual needs.

With respect to specialized transit services within the Region of Durham, the acceptable model for accessible transportation in a community is a three-tiered system involving the following components:

• Accessible Conventional Tramit (Public) - This involves conventional service operating a fixed route utilizing low floor buses;

• Specialized Transit (Public) - Pre-arranged door-to-door service with boarding assistance provided by a fully trained specialized transit operator. Clients are subject to a registration/eligibility process.

• Accessible Taxis· (Private) - Convenient "on demand" service available at a premium fare.

A more integrated service involving Handi Transit Inc., Community Care (Brock) in particular, and APTA (specialized) would provide a higher level of accessibility for eligible residents within the Region of Durham including those in the northern areas.

The following points are offered in support of the need and rationale for expanded inter-municipal and inter-regional conventional and specialized services within the Region of Durham, consistent with the objectives of the CSP and the OP. These points also reflect the goals and objectives associated with the transit vision for the Region as articulated in both the TMP and the TIP. The myriad of benefits attributed to enhanced transit services within the Region of Durham provide a powerful rationale for investing in the integration of the conventional and specialized transit systems in Durham.

Goal A: An Integrated Transit Network • Unified Planning Focus/ Regional Transportation Planning - A fully integrated transit system

within the Region of Durham, as suggested in the CSP and the TMP, will require a unified planning focus within a regionally based transportation and land use planning framework concentrating on regional objectives. Without this regional level focus, transit services will continue to reflect local objectives, and will be fragmented with the required service levels unachievable.

• Jurisdictional Boundariesllnstitutional Constraints - One of the key tenets of transportation planning is that demand for travel is not dictated by municipal or regional boundaries. Within the Region of Durham arterial roadways are generally planned, constructed and maintained by the Region. As transit services are currently provided by the local municipalities, travel between adjacent municipalities is not quite as seamless as travel by auto. Given the current sources and mechanisms for funding transit at a local level, it is unlikely that communities will invest in resources that might be construed as serving the residents of an adjacent municipality. In order to improve transit services for the residents of the Region there is a need to establish a network and organizational and governance structure that will provide the greatest probability of success in the achievement of an integrated transit network for both conventional and specialized services.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

• Implementation of BRTILRT - Higher order conventional transit services such as Bus Rapid Transit (BRT) and Light Rail Transit (LRT) are possible only within a unified and integrated transit structure. Both require a significant increase in inter-municipal demand, which is unlikely to present itself with the current local and fragmented service structure.

• Fare Integration/Service Co-ordination - Transit integration can only be accomplished in the Region with an integration of fares between local providers, and between the local providers and GO Transit. This applies for both conventional and specialized transit. Fare integration and service coordination require centralized unified decision-making and management if they are to be achieved across the Region. The current institutional structure will not likely permit such integration and co­ordination to occur and the timing of such decisions will be protracted enough that opportunities to make gains in ridership as a result of service or network improvements may be lost.

Goal B: Transit Access to all Sectors/Areas oft"e Community • Rural Services - With the exception of GO Transit Bus Services in the Highway 12 Corridor, there

is no conventional type service to the rural areas of the Region, particularly Brock, Scugog, and Uxbridge. There is some limited service to Orono in the Municipality of Clarington. Despite the benefits that will accrue to the communities in the north, the initiation or expansion of conventional transit services in the rural areas is unlikely given the current practice of having service provided and funded by the local municipalities. A unified or integrated approach to transit provision in the Region will increase the probability of conventional services being provided for areas currently receiving little or no service. With respect to specialized services, a unified approach to these activities would also result in improved and more cost-effective services to both urban and rural areas.

• Cross-Boundary Service - A significant number of person-trips made in peak periods cross municipal boundaries, and this regional mobility pattern will be better served by both conventional and specialized service within a unified and integrated structure planned with regional mobility issues in mind.

• Specialized Services - Specialized services are fragmented at present in both the urban and rural areas within the Region. Unified or integrated coordination and management of these services improves the prospect of enhancing these services.

Goal C: An Affordable/Efficient System • Services to New/Developing Areas - Service expansions to new and developing areas in the Region

can be more effectively realized by funding strategies developed within a unified and region wide focus. The focus of local municipal transit services is directed towards minimizing financial losses, and not towards service expansion.

• ProvinciallFederal Funding - Transit has recently become a greater priority for both senior levels of government, and financial support, either through the transfer of gas tax revenues or through other project-specific funding programs, has been committed by both the federal and provincial governments. The Province recently announced that an additional tax will be added to fuel to be directed to transportation initiatives.

• An Integrated Network - Achieving an integrated transit network requires decisions with respect to service planning, operations, and finance. A unified structure would reduce the complexity of making those decisions. Integration is also an objective outlined in the 'Places to Grow' document, and, here again, a unified model will facilitate that integration with other systems serving the GGH.

• Transit Modal Shift - Achieving the desired transit modal shift will be facilitated by an integrated service conducting planning that is not constrained by municipal political boundaries.

• Reduced Investment in Other Infrastructure - An integrated transit system will help reduce the investment required for the roadway network.

• Cost-Effectiveness - It is reasonable to expect that increased cost-effectiveness can be achieved through economies of scale [in the long tenn] generated by an integrated transit network.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional MunicIpality of Durham October 2004

• Relationships with the Province - Relationships with provincial agencies such as GO Transit and the proposed Greater Toronto Area Transportation Authority (GTTA) will be facilitated by a single unified voice speaking for all transit interests within the Region.

• Marketing - Marketing a unified service with the same goals, objectives and service policies for both conventional and specialized transit should prove more effective in providing information to the public and other stakeholders.

Goal D: Livable/Environmentally Sustainable ComnHlIlities • Infrastructure Coordination - With an integrated approach to regional transportation and transit

planning in place, there will be a greater opportunity to coordinate transportation, land use and transit planning, and the required road improvements with the development of new communities and the re­development of existing communities. Transit priority resources can also be better integrated into the existing and planned roadway network.

• Economic Growth - Investment in an integrated transit system will facilitate the creation of new employment opportunities. Information published by the American Public Transportation Association in 2002, suggested that for every $10 million invested in public transit capital projects, 300 new jobs will be generated, and a similar amount invested in transit operations would generate 600 jobs by getting people to work that otherwise would not be able to travel. Public transit has also facilitated the revitalization of business districts and downtowns. This is an issue in a number of communities in Durham.

• Economic Benefit - Public transit use lowers household expenses and frees up income for other needs. Automobile expenses can be considerable, especially when the marginal costs of auto are realistically considered. Information obtained from the American Public Transportation Association indicates that the average US household spends 18 cents of every dollar spent on transportation, 98% of which is for busying, maintaining and operating autos. For low income families, transportation costs can exceed 35% of income.

• Increased Tax Base - The American Public Transit Association has also suggested that in the US, the public transit industry generates a 6 to 1 net return on investment, which translates into higher revenues for the Region and its constituent municipalities.

• Reduced Energy Use/Consumption - The current transit network in the Region does not provide a viable option to the automobile for many trips. A unified or integrated system provides a greater opportunity to reduce growth in auto use as the community continues to grow, through shorter trip lengths, reduced ownership and trip making in general.

• Reduced Vehicle Emissions - A unified or integrated approach to transit services within the Region and a reduction in the growth in auto use will also result in a reduction in the growth of vehicle emissions; emissions from road vehicles are the largest contributors to smog and have proven to be devastating to the environment. Future Federal funding of transit and other transportation initiatives may be contingent on achieving quantitative reductions in greenhouse gases (GHG). Increased investment in and use of public transportation provides significant direct environmental benefits and helps meet Federal commitments regarding the Kyoto Accord.

• Reduced Road Congestion - Although it is clear that the automobile will continue to be the primary mode of transportation within the Region for the foreseeable future, an increase in transit ridership is fundamental to reducing the growth in demand for roadway capacity.

• Specialized Transit - A Real Transportation Service - Specialized transit is currently viewed as a social service. With an integrated structure, this service could be treated as a key transportation service for the community. Data published by the American Public Transit Association indicates that by the year 2020, 40% of the US population will be senior citizens, many of who will be unable to drive.

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Business Case Analysis for the Potential Transfer of Lower-Tier Mllnicipal Transit Se,vices to the Regional Municipality of Dlirham October 2004

Goal E: Public Demand/Client Needs • Inter-MunicipalIInter-Regional Services - Public surveys have demonstrated that a demand exists

for greater levels of conventional and specialized inter-municipal and inter-regional services within Durham.

• Governance Structure - Working within an integrated planning and operating framework would enable operators to cooperate in planning those network modifications that would result in service improvements demanded by transit users. Within existing municipalities there are frequently institutional constraints or issues that derive from a lack of co-ordination, integration of programs and policies and disparate views, objectives and priorities between departments

• Transportation Choice - An integrated transit system within Durham with increased frequencies, fare integration and reduced and competitive travel times for inter-municipal and inter-regional trips, will result in a system that is viewed by the public and other stakeholders as a viable option to the automobile. Choice in transportation mode is a key element of a sustainable transportation network. For many residents of Durham, public transit is a necessity. Many Durham residents on social assistance programs including those in rural areas, do not own cars.

7.3 Summary and Conclusions

The Region of Durham continues to be a major growth area within the GTA. New residents and businesses are attracted to the area in unprecedented numbers. It is predicted that this growth and expansion will continue for the foreseeable future. Obviously, with such growth come challenges providing adequate transportation services for the residents and other stakeholders within the community. Durham is currently challenged by lack of adequate transportation facilities and travel for residents is limited mainly to automobile travel, except for some local trips within each of the individual municipalities.

Providing an effective and efficient transportation infrastructure is critical to the continued success and prosperity of the Region and transit is a specific requirement which cannot be overstated. As previously discussed, the magnitude of the transportation challenge in Durham is daunting. Growth in traffic on the roadways has already outpaced growth in population and it is anticipated that this will continue for the next two decades. While there are significant plans in place for road improvements and expansion, there is limited physical space available to expand the arterial and provincial highway network. There is also the environmental and quality of life implications of a continued reliance·on the automobile. The only option other than to stop, or greatly curtail growth, is to improve and expand public transit services to meet a larger portion of the future transportation demand.

Over the next two decades the future success of public transit in Durham lies in the ability of providing greater levels of inter-municipal and inter-regional transit and, to a certain extent, on the provision of higher order services on key routes. Higher order services could include services operating in their own separate rights-of-way thereby isolating it from the effects of congestion on the road system. This could be as simple as an HOV lane or a dedicated corridor, such as an abandoned rail line.

It is clear that the public transit services cannot be delivered in the same manner that they have over the last few decades if the Region is to achieve modal share and auto reduction targets documented in the TMP. The current organizational structure and operational strategies precludes the attraction of significant number of inter-municipal and interregional trips because of the local focus on each of the constituent communities within Durham. In order to be competitive, public transit must be fast, frequent and reliable and fully integrated with the GO services from both a service and fare perspective. With respect to specialized services, fully integrated service would enhance services for a growing sector of the community who require specialized transit.

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Sen'ices to the Regional Municipality of Durham October 2004

Integration of conventional and specialized services across the Region is clearly desired to ensure the viability of transit as a legitimate mode of transportation and to achieve the mobility targets established by the Region of Durham,

In summary, a higher level of integration of conventional services across the Region for fares and service should be pursued at this time, In addition, the integration of specialized services across the Region should be pursued. Fares for these specialized services should also be integrated and fixed at levels compatible with conventional service.

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Business Case Analysis for the Potential Trallsfer of Lower-Tier Municipal Trallsit Sel1'ices to the Regional Municipality of Durham October 2004

8 DELIVERING INTEGRATED TRANSIT FOR DURHAM The merits of transit integration for conventional and specialized transit are articulated in Part B. It has been concluded that significant benefits would accrue to the residents of Durham as a result of transit integration and that it is in the best interests of the public to deliver transit in a more integrated way. This Part of the report addresses how integrated transit should be delivered to the residents of the Region. GO Transit, under each of the three scenarios assessed will continue to operate as a separate entity providing both bus and rail service to the Region. It should be noted that only public sector delivery of transit services was considered in the context of this review.

8.1 Service Delivery Options

In order to deliver a higher level of transit integration within the Region, three potential options have been identified: the Status Quo, Enhanced Status Quo and Full Amalgamation of conventional and specialized services. These options are described below.

8.1.1 Status Quo

The Status Quo alternative includes maintaining current operators for both conventional and specialized services. For conventional services, there would continue to be five different transit properties operating within Durham Region (APTA, Whitby, Oshawa, Clarington and GO Transit). The specialized services would continue to be provided by APTA, Handi Transit and Community Care (Brock).

Funding would be raised through local municipal levies, supplemented by the Regional Transit Fund in accordance with the TIP recommendations and provincial/federal funding programs.

Transit services would continue to operate under separate organizational structure and collective agreements.

A mechanism to pennit the planning and operation of fully integrated services in Durham would have to be established.

8.1.2 Enhanced Status Quo

The enhanced Status Quo scenarios would operate the same as the Status Quo with the exception of amalgamation of Whitby, Oshawa and Clarington services into a single service provider. Fare and service integration between Oshawa-Whitby-Clarington is underway and would be fairly uncomplicated to implement. A mechanism would have to be established to permit the planning and operation of fully integrated services across Durham.

Funding would be raised using a method consistent with the Status Quo scenario.

8.1.3 Full Amalgamation

Full amalgamation would consist of conventional and specialized transit incorporated into a "regional" organization.

Funding would be raised through a combination of the Regional Transit Fund, local levies collected by the Region and supplemented by provincial/federal funding programs.

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Business Case Analysis for the Potential Transfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

The collective agreements would be harmonized into a single bargaining unit.

8.2 Assessment of Service Delivery Options

In order to compare/assess the service delivery options of Status Quo, Enhanced Status Quo and Full Amalgamation, the following factor groups and criteria were developed.

8.2.1 Factor Group Descriptions

The factor groups and criteria are consistent with the goals and objectives provided in Section 4.3.

Factor Group 1 - Provide all Illtegrated Trallsit Network • The degree to which inter-municipal ridership can be increased. - Assessment of the ability of a

particular organizational alternative to facilitate increased transit ridership between municipalities within the Region of Durham;

• The degree to which inter-regional ridership can be increased. - An assessment of the potential of organizational alternatives to achieve increased inter-regional transit service and ridership through improved linkages to GO Transit, improved linkages to other transit systems and services and ability to increase overall ridership;

• The degree to which local ridership can be increased. - An assessment of the ability of organizational alternatives to improve transit service within the local municipalities and increase ridership at a local level;

• The degree to which convenience to Durham residents can be increased. - An assessment of the ability of organizational alternatives to provide a greater level of access to transit, require fewer transfers to complete a trip and to provide the appropriate amenities and improve overall convenience to Durham residents;

• The degree to which higher order of transit service in the future (BRT, LRT) can be facilitated. - The ability of transit service and organizational structures to develop a transit system that results in increased ridership along major transit corridors/spines essentially leading to the implementation of higher order transit including BRT, and if necessary, LRT in the future;

• The degree to which integration with GO Transit can be effected. - The ability of organizational alternatives to improve integration and service linkages with GO Transit for local, inter-municipal and inter-regional travel; and

• The degree to which uniformity of standards can be achieved across the Region. - The ability of organizational structures to achieve uniformity in terms of transit service and operating standards across the Region of Durham.

Factor Group 2 - Provide Access for all Areas and Sectors of the Commullity • Potential to develop conventional services in rural areas. - Ability of organizational structures to

develop and finance conventional and improved specialized transit services in the rural communities within the Region of Durham;

• The degree to which seamless specialized transit services for patrons across the Region of Durham can be provided. - The ability of organizational alternatives to facilitate seamless travel for patrons requiring specialized services across the Region. It includes both rural and urban areas.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

Factor Group 3 - Develop a System that is Affordable and Efficient • The degree to which more balanced investment in transportation infrastructure can be effected. - The

ability of organizational structures to integrate transit planning into appropriate planning of other infrastructure elements including road, cycle, walk, etc. Includes the ability of organizations to reduce the need for and expenditures related to non-transit infrastructure including roadways;

• Economic Benefits - The ability of organizational structures to facilitate quantifiable and non­quantifiable economic benefits as a result of improved transit services and ridership across the Region of Durham. Economic benefits may include increased development, increased density along designated transit corridors, increased employment, increase work force participation levels, etc.;

• The degree to which transit service can be competitive with auto trips. - The ability of organizational structures to establish a transit network and operating parameters that make transit more competitive with auto travel for some trips within and through the Region of Durham;

• The degree to which fare criteria can be achieved across the Region - An assessment of the ability of organizational structures to achieve fare integration (i.e. same fare structures) across the Region of Durham;

• The degree to which sustainable provincial/federal government funding (subsidies) can be attracted. -An assessment of the ability of organizational structures to attract sustainable provincial/federal funding to support transit initiatives including vehicle replacement and service expansion. This would include assessing the ability of organizational structures to achieve funding in competition with other municipalities around the GT A. It is very likely that future senior government transit funding will be based on certain performance criteria relating to transit service provision within a community;

• The level of effort and ability required to implement organizational options. - An assessment of the level of effort and ability of organizational structures to achieve implementation of 5 and 10 year service plans; and

• HR and Labour Impacts - An assessment of the level of HR and labour impacts that may be associated with the creation of suggested organizational structures, including resources required and the ability to resolve labour issues.

Factor Group 4 - Facilitate the Development of a Liveable and Environmentally Sustainable Community • The degree to which improved transit service will facilitate environmental benefits. - The ability of

organizational structures to create a transit system or systems that result in environmental benefits to the community including reductions in greenhouse gases, reduction in other pollutants, etc;

• The degree to which improved transit services will facilitate community and social benefits. -Assessment of the ability of organizational structures to develop transit networks and systems that will result in community and social benefits including reduction in urban sprawl, increased access to transit services for all residents of the Region, reduction in overall travel costs for residents, etc.;

• The degree to which transit supportive growth patterns (development aspirations) will be facilitated. -The ability of organizational structures to create transit and transportation networks that would facilitate development patterns in the Region that are consistent with growth patterns identified in the Regional Official Plan and local OP documents;

• The degree to which the transit organization and system structure is consistent with provincial growth management policies/strategies. - Ability of organizational structure to achieve provincial growth management strategies as articulated in the "Places to Grow" document and other provincial policy statements;

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Business Case Analysis for the Potential Transfer of LOlVer- Tier Municipal Transit Services to the Regional Mllllicipaliry of Durham October 2004

• The degree to which congestion can be reduced within the Region - An assessment of the ability of organizational structures to develop transit infrastructure and services that will result in reduced automobile demands, thereby reducing congestion on certain key links within the Region of Durham.

Factor Group 5 - Satisfy Public Demalld and Client Needs • The degree to which marketinglinformation can be improved. - An assessment of the ability of

organizational structures to produce information and marketing material aimed at increasing awareness of the benefits of public transit and increasing ridership;

• The degree to which monitoring/accountability can be effected. - The ability of organizational structures to develop monitoring and accountability procedures to ensure that service and operational targets are being achieved;

• The degree to which transit accessibility can be improved. - The ability of organizational structures to improve accessibility to both conventional and specialized services. This would include the ability of organizations to provide the appropriate conventional vehicles (low floor buses) that would reduce demands placed on Handi Transit, permitting them to provide an overall improved level of service across the community;

• The degree to which a higher level of mobility choice can be achieved. - The ability of organizations to develop transit infrastructure that would provide a viable choice for residents within the Region of Durham, both in the urban and rural areas;

• The degree to which service levels can be improved. - An assessment of the ability of organizational structures to affect improvements in service levels that would improve the viability of transit as a transportation alternative;

• The degree to which demand for school trips can be satisfied. - The ability of organizational structures to ensure that existing and future demand for travel for school children can be satisfied at a local and inter-municipal level (Durham College/UOIT);

• The degree to which equity in service provision can be achieved. - An assessment of the ability of organizational structures to ensure that levels of service provided across the Region are consistent with respect to population and density, major trip generators, etc.

Table 8.1 details the assessment of Service Delivery Options.

8.3 Evaluation of Service Delivery Options

The service delivery options were compared using the Factor Group/Criteria defined above. Following the assessment, an evaluation of service delivery options was undertaking using a standard balance sheet scoring method. All factors were given equal weight. Table 8.2 illustrates the evaluation of service delivery options.

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Business Case Analysis Jnr the Potential Transfer oj Lower-Tier Municipal Trallsit Services to the Regional MUllicipality oj Durham October 2004

ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA

inter-municipal ridership

Local Councils unlikely to approve expenditures that could be perceived to benefit an adjacent municipality.

• May be difficult to achieve agreement on fares, services, frequency, etc. among all municipalities in a timely manner

• Continued focus on cost containment and limited funding capability will affect ability to achieve higher levels of inter municipal service.

• Potential for major union issues to preclude inter-municipal service, i.e. unions may prevent other operators from boarding and discharging passengers in their municipality.

• Recent service enhancements (expansion to Clarington, D-Pass, Student Pass) have only been possible through Regional subsidy (Regional Tax Levy) and/or planning co-ordination.

ENHANCED STATUS QUO

Local Councils unlikely to approve expenditures that could be perceived to benefit an adjacent municipality.

• May be difficult to achieve agreement on fares, services, frequency, etc. among all municipalities in a timely manner

• Continued focus on cost containment and limited funding capability will affect ability to achieve higher levels of inter-municipal service.

• Some improvements to inter­municipal service as a result of amalgamation of Oshawa/Whitby/Clarington services - cost effective cross-region service may still be difficult to attain

• Potential for major union issues to preclude inter-mwlicipal service, i.e. unions may prevent other operators from boarding and discharging passengers in their municipality.

AMALGAMATION

Highest potential to provide enhanced east-west and north- south inter-municipal services.

• Service improvements viewed in an inter-municipal context in addition to local improvements.

• May accelerate GO Transit expansion plans to Clarington.

Page 60

Busincss Case Anlllysis for thc i'o/entilll Transfer of Lower-Tiel' Municipal Transit Services to the Regional Municipality of Durham October 2004

TABLES.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO Potential to increase • Focus on local services supports • Focus on local services supports • inter-regional inter-regional service through inter-regional service through ridership linkages/integration with GO Transit. linkages/integration with GO Transit.

• Local focus on cost containment • Local focus on cost contaillllent likely precludes higher levels of east- likely precludes higher levels of east-west and north-south travel in west and north-south travel in • Durham to a point where inter- Durham to a point where inter-regional transit opportunities will be regional transit opportunities will be enhanced. enhanced.

• Future linkages to the Highway 407 • Some opportunity for minor Transitway and associated stations improvement to inter-regional • may be compromised as a result of ridership as a result of amalgamation service cost implications. of Whitby/Oshawa services.

• Future linkages to the Highway 407 Transitway and associated stations may be compromised as a result of the cost of local service connections • through areas where there is limited development (ridership).

AMALGAMATION

Highest potential to achieve increases in inter-regional services due to increased overall ridership increases associated with improved inter-municipal services. GO Transit serves a more important and effective part of the Transit network in Durham i.e. Highway 407 Transitway, Highway 2, Highway 12 etc. With increased ridership in key corridors, GO Transit more likely to increase service frequency and express services - possibility of initiation of limited stop service on Highway 2 in short-term. May accelerate GO Transit expansion plans to Clarington.

Page6J

BliSilll'SS Case Anal)'si:; far the Potential Transfer of Lower-Tier Municipal Transit Services to the Regiollal Municipality of Durham October 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO

Potential to increase • Local focus could result in increased • Local focus could result in increased • local ridership local ridership provided local local ridership provided local

Councils make the appropriate level Councils make the appropriate level of investment. of investment.

• Recent trends suggest that a focus on • Recent trends suggest that a focus on cost containment and limited funding cost containment and limited funding capability may affect growth in local capability may affect growth in local • ridership. ridership.

• Existing conventional services in • Amalgamation of Clarington may not be sustainable if Whitby/Oshawa/Clarington services municipality is required to fund may result in increased ridership due • services (currently funded through to service improvements resulting the "Regional Transit Fund"). from amalgamation.

• Increases in local ridership may be • Existing conventional services in made at the expense of inter- Clarington may not be sustainable if municipal service expansion given municipality is required to fund limitations on funding. services (currently funded t1u-ough

the "Regional Transit Fund").

AMALGAMATION

Amalgamation and a focus on providing enhanced services across one Region rather than on cost containment will result in enhanced local networks/services encouraging increased levels of local ridership. Strengthened inter-municipal comlections reap the highest potential for increased local ridership in the longer term. Enhanced local services are essential to building ridership on a region-wide basis.

Page 62

Busilless Case Analysis for lire ['olelllini Trallsfer of Lower- Tier Municipal Transit Services to the Regional Municipality of Durham OClober 2004

TABLES.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO

Increase convenience • Focus on cost containment and • Focus on cost contailll1ent and • for Durham limited funding availability results in limited funding availability limits the Residents the least potential for increasing potential for increasing overall •

overall convenience to Durham convenience to Durham residents -residents - even at a local level. even at a local level.

• Routes and frequencies designed on • Routes and frequencies designed on the basis of cost contailll1ent rather the basis of cost containment rather • than greatest opportunities to than greatest convenience. enhance convenience. • Some improved levels in

• Given limited funding capability, convenience for unlikely to achieve agreed upon Whitby/Oshawa/Clarington residents transit operating standards thereby as a result of amalgamation. • failing to maximize convenience. • Given limited funding capability,

• Unlikely to be able to provide service unlikely to achieve agreed upon to new developments due to low transit operating standards, thereby • return through farebox. failing to maximize opportunities to

enhance convenience.

• Unlikely to be able to provide service • to new developments due to low return through farebox.

•

AMALGAMATION

Highest potential to improve convenience for Durham residents. Amalgamation and opportunities for improved integration with GO will result in higher levels of convenience to all Durham residents over time. Investment in new/revised routes and increased frequencies will make transit more competitive with other modes of transport thereby increasing overall convenience. Achieving the agreed upon operating standards over time will further enhance convenience. Higher probability that service can be provided to new developments -assumes conll1itment to funding. Increased frequency will improve the "quality" of transit travel within the Region. Provides greater levels of mobility for an aging population.

Page 63

Busil1ess Case Al1alysis/orthe Potel1tial Tral1s/er a/Lower-Tier Municipal Tral1sit Services to the RegiOl1al Municipality o/Durhalll October 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

'CRITERIA STATUS QUO ENHANCED STATUS QUO

Facilitate higher • Least potential to facilitate higher • Marginal potential to achieve higher • order transit service order transit service due to local order services, but unlikely to result in the future (BRT, focus, funding constraints, limited in BRT or LRT as ridership on major • LRT) ridership growth etc. and east-west and north-south links will

disadvantage in obtaining senior be affected by lack of strong inter-govemment funding. municipal and inter-regional service

• BRT, LRT require high volume key focus, and disadvantage in obtaining corridors - not achievable with local senior government funding. focus funding constraints and low • Local municipalities unlikely to priority given to inter-municipal and agree to co-fare arrangements with • inter-regional services. GO on Highway 2, 12 etc. due to

• Local municipalities unlikely to cost implications (requirement to agree to co-fare arrangements with subsidize fares) - will affect GO on Highway 2, 12 etc. due to ridership. • cost implications (requirement to subsidize fares) - will affect ridership.

Enhance integration • Current GO linkages can be • Current GO linkages can be • with GO Transit maintained. maintained.

• Role of GO would generally be • Role of GO would generally be • unchanged. unchanged.

• Local municipalities unlikely to • Some opportunity for increased agree to co-fare arrangement with integration with GO - particularly in GO on Highway 2, 12 etc., due to OshawalWhitby/Claringtoll. cost implications. • Local municipalities unlikely to

agree to co-fare arrangement GO on Highway 2, 12 etc., due to cost implications.

AMALGAMATION

Highest potential to facilitate future development ofBRT, LRT etc. Network/system focusing on improved inter-municipal and inter-regional services could encourage increased development/density in key corridors - facilitate BRT, LRT level ridership - assumes ongoing conunitment to funding. May be possible to effect some higher order GO service on Highway 2 (limited stop service) in the short term. Region more likely to support co-fare arrangements with GO even with cost implications; obtain senior govemment funding necessary to implement higher order services. Highest potential for increased levels of integration with GO. GO can provide enhanced inter-regional and inter-municipal services - Highway 2 - Region more likely to agree to co-fare arrangements with GO.

Page 64

Bllsincss Cas£' Analysisfor tlte Polential Transfer of Lower-Tiel' Mllnicipal Transil Services 10 the Regional Mllnicipality of Durham Oclobcr 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO

Potential to achieve • Lowest potential to achieve • Some potential for the establishment • unifonnity of uniformity of standards of uniform operating standards. operating standards • Difficult to obtain agreement • Still requires local councils to agree

amongst local Councils on operating on standards and concomitant standards given local focus on cost funding associated with achieving containment and limitation in unifonnity. available funding.

FAC fOR - PROYIDE ACCESS FOR ALL AREAS & SECTORS OF THE CO:\I:\IlTNITY Potential to develop • Little or no potential to implement • Little or no potential to implement • conventional services conventional services in northern conventional services in northern in rural areas municipalities. municipalities.

• With service provided/funded by • With service provided/funded by local municipalities, unlikely that local municipalities, unlikely that • rural municipalities can afford any rural municipalities can afford any type of conventional or para-transit type of conventional or para-transit • service. service.

• Current rural services in Clarington • Current rural services in Clarington not likely sustainable if funded not likely sustainable if funded entirely by the municipality. entirely by the municipality.

Seamless travel for • With specialized transit provided by • With specialized transit provided by • patrons of specialized APT A, Handi-Transit and APT A, Handi-Transit and servIce Conununity Care, some Community Care, some

improvement to service co-ordination improvement to service could be could be effected, however, total effected, however, total seamless • seamless service will be difficult to service not likely achieve. • Integration of fares unlikely. •

• Integration of fares unlikely.

AMALGAMATION

Amalgamation would result in a single set of uniform operating standards to be attained over a period of time.

Highest potential for rural municipalities to receive conventional service in short -medium time frame. Service will require funding assistance from the Region. Several options for service provision may be available under an amalgamation model.

With amalgamation of specialized services, improved integration across the region can be achieved - both in urban and rural areas. Integration of fares would be achievable. Potential to equate fares to that of conventional service.

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Business Case Analysis for/he Potell/ial Transfer of Lower-Tier MUllicipal Trallsi/ Services to the Regiollal MUllicipali/y of Durham Oc/o/)cr 2004

TABLES.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

balanced investment in transportation infrastructure (road congestion)

STATUS QUO

local service. • Limited increases in ridership will

not reduce auto related infrastructure demands.

ENHANCED STATUS QUO

• enhanced status quo.

• Limited increases in ridership will not reduce auto related infrastructure demands.

• Potential for some minor reduction in auto related infrastructure in OshawalWhitby/Clarington -

not likely significant.

AMALGAMATION

• Highest potential for more balanced investment in infrastructure due to increased ridership at local, inter­municipal and inter-regional levels.

Page 66

Business Case Analysis for Ihe Polen/ial Transfer of Lowe/"- Tier Municipal Transit Services 10 Ihe Regional Municipality of Durham October 2004

TABLES.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO

Economic Benefits • Transit service provided by local • Transit service provided by local • municipalities unlikely to achieve municipalities unlikely to achieve substantial economic benefits. substantial economic benefits.

•

•

• • •

•

•

AMALGAMATION

Highest potential for spin off economic benefits due to nature of system/service - inter-municipal and inter-regional. Benefits accrue as a result of development within transit cOlTidors, additional ridership (workers), and new employment opportunities -increased accessibility to job markets. Some of the workforce is attracted back to jobs as a result of convenient and affordable transportation option (transit). Lowers household expenses. Expansion of labour pool. Assists in revitalizing business districts and activity centres (downtown areas), particularly those identified in the Places to Grow document (e.g. Pickering and Oshawa downtowns). Potential to reduce the cost of EMS services. Transit investment has proven to assist in increasing the tax base and public revenues.

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Business Case Anal),sis Jor the Potential TransJer oj Lower-Tier MUl1icipal Transit Services to the Regiol1al Municipality oj Durham October 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO Ability to compete • Local services stilI focused on GO • Local services stilI focused on GO • with the auto for and school trips. Unlikely to attract and school trips. Unlikely to attract some trips. other local, inter-municipal and inter- other local, inter-municipal and inter-

regional work trips. regional work trips.

• Cost of inter-municipal and inter- • Some local transit trips within regional service not competitive with Whitby, Oshawa and Clarington may • auto. become more competitive with the

• Auto still overwhelmingly the auto. preferred mode of transportation • Cost of inter-municipal and inter-

• Local focus - cost containment. regional service not competitive with auto.

• Auto still overwhelmingly the preferred mode of transportation

• Local focus - cost containment. Ability to achieve • Limited ability to achieve integration • Some potential for fare integration - • fare integration - local Councils may have difficulty may be several years before it can be across the Region agreeing on fare levels, fare achieved. •

increases, GO Transit fare • Local Councils may have difficulty agreements, etc. agreeing on fare levels, fare

• May be several years before increases, GO Transit fare integration can be achieved. agreements, etc.

Ability to aUract • Lowest potential to successfully • Some, however, limited potential to • sustainable upper-tier aUract provinciaVfederal funding due attract provinciaVfederal funding. government subsidies to local focus of service and need to • Need to compete with larger service

"compete" with much larger service providers with a focus more providers with a focus more consistent with provincial and federal consistent with provincial and federal objectives. • objectives. • Difficult to achieve a unified position

• Difficult to achieve a unified position within Durham amongst within Durham amongst municipalities - this issue would be municipalities - this issue would be exacerbated if lUral municipalities exacerbated if lUral municipalities were without conventional services. were without conventional services.

AMALGAMATION

Amalgamated service has the highest potential to compete with some auto trips due to level of service and cost-effective inter-municipal and inter-regional transit. Costs-effectiveness could be enhanced by the implementation of transit supportive TDM and traffic operational transit priority strategies.

Fare integration key to provision of viable inter-municipal services. Potential for co-fare agreement on Highway 2 with GO Transit.

Highest potential to attract provincial/federal funding. Unified and stronger position can be taken with provincial and federal governments. Higher levels of inter-municipal and inter-regional services consistent with provincial growth management and federal objectives.

Page 68

Business Case A 1J(r/) 'sis for tile Potcntial Tmnsfer of Lower-Tier Municipal Tmnsit Services 10 the Regional Municipality of Durham October 2004

TABLES.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO Ease of • No change to existing organizational • Minor change to existing • implementation structures. organizations.

• Sale of business required between Whitby/Oshawa for amalgamation.

•

•

HR and labour • None. • Some impacts with amalgamation of • impacts • It is likely that cost of service will Oshawa and Whitby transit

naturally increase as unions across organizations. the Region seek wage parity for • Sale of business required. • employees. • Oshawa/Whitby - similar unions

however significant differences • between agreements.

• May be limited ability to protect all jobs. •

• It is likely that cost of service will naturally increase as unions across the Region seek wage parity for employees.

AMALGAMATION

Changes to organizational structures are major - however, can be staged to reduce transitional costs, staff disruption, union and legal requirements (sale of business). Commitment to "no job loss" can be made at time of amalgamation. Transition to final organizational structure could be effected over several years. HR and labour impacts significant, could be minimized through staged amalgamation process. Conmlitment to "no job loss" can be made at time of amalgamation. Transition to final organizational structure could be effected over several years. Cost of service will increase due to increased salaries (migration to higher wages) although inunediate impacts could be mitigated tluough staged amalgamation.

Page 69

Business Case' Analysis fo/' tile Pote'ntial Transfe/' of Lowe'/'- Tier Municipal Transit Services 10 the Regional Municipality of Du/'ham October 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO

• Minimal benefits with marginal • Benefits improvement in ridership - and

marginal reduction in auto use at a local level

•

•

•

Achieve Regional • Regional mode share objectives • Regional mode share objectives • mode share (TMP) not likely achievable. (TMP) not likely achievable. objectives (TMP) • Cannot capture required inter- • Cannot capture required inter-

municipal, inter-regional volumes. municipal, inter-regional volumes

AMALGAMATION

Highest potential for longer term environmental benefits

• Air Contaminants

• Nitrogen Oxides (NOx)

• Volatile Organic Compounds (VOCs)

• Sulphur Oxides (SOx)

• Particulate matter

• Carbon Monoxide (COx)

• Greenhouse Gases

• Carbon Dioxide Reduced resource consumption -including land. Increased overall public health benefits. Greater level of reduction in automobile travel. Highest potential to achieve Regional mode share and auto reduction targets as articulated in the Durham TMP.

Page 70

Business Case Allalysisfor the Potential Transfer of Lower-Tier Municipal Transit Services to the Regialwi Municipality of Durham October 2004

TABLES.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO Conununity and • Limited community and social • Limited community and social • social benefits benefits. benefits.

• Cost of travel for residents may • Cost of travel for residents may increase with increased congestion. increase with increased congestion.

• Cost to conmmnity will increase - • Cost to community will increase - • resolution of congestion. result of congestion.

•

•

•

•

• •

Facilitate transit • Minimal impact on land-use and • Minimal impact on land-use and • supportive growth development decisions. development decisions. patterns • Little opportunity to provide transit • Little opportunity to provide transit • ( development to new development areas due to to new development areas due to aspirations) local focus on cost containment and local focus on cost containment.

funding challenges. Consistency with • Not consistent. • Somewhat consistent. • provincial growth management policies/strategies

AMALGAMATION

Highest potential for individuals to realize transportation cost savings -transit will be more competitive with auto travel. The availability of convenient transit can provide travelers with time savings. Reduction in accident related costs

• Property costs

• Injury costs

• Fatalities Some travelers can avoid expenses associated with vehicle ownership. Reduced auto traffic benefits all roadway users (consumer surplus). Increase in residential and conunercial property values. Reduced right of way cost savings. More efficient use of road network -overall conununity cost savings. Highest potential to influence development patterns and growth. Region can control all transportation decisions that can be more effectively made in concert with land use decisions. Consistent.

Page 71

BI/siness Case Analysisfor the Potential Transfer of Lower-Tier Municipal Transit Se'Tices to the Regional Municipality of Durha!1I October 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO

Ability to contribute • Almost no opportunity to reduce • Almost no opportunity to reduce • to reduced levels of congestion. congestion. traffic congestion • Local focus is GO and school trips. • Local focus is GO and school trips.

• Major congestion within the Region • Major congestion within the Region is in east-west direction in peak is in east-west direction in peak • travel periods. travel periods.

FACHlR - S·\lISFY Pl"llLIC DEl\L\"'D & CLlEYfS "'EEDS Ability to improve • Transit information continues to be • Transit information continues to be • marketinglinformatio provided at a local level. provided at a local level n • Limited marketing material of other • Limited marketing material of other

transportation/transit opportunities transportation/transit opportunities within the Region. within the Region.

• Level of marketing and quality of • Level of marketing and quality of material is inconsistent across the material is inconsistent across the Region. Region.

Monitoring/ Accounta • At a local level only. • At a local level only • bility

•

Improve accessibility • Limited improvement to • Limited improvement to accessibility • to transit accessibility. • Requires additional low-floor

• Requires additional low-floor vehicles vehicles. • Routes/frequency dependant upon

• Routes/frequency dependent upon funding - local focus on cost funding - local focus on cost containment containment. • No improvement to lUral service and

• No improvement to lUral service and to developing areas to developing areas.

AMALGAMATION

Highest potential to address congestion with focus on higher-levels of inter-regional and inter-municipal service. Could address east-west existing and future congestion through higher order transit services to a degree that may impact future investment.

Opportunity to improve transit and transportation marketing and combine with other regional and local TDM and planning activities.

At a regional level, improvements to transit can be monitored against regional targets, TDM strategies etc. Performance can be monitored against OP and CSP objectives/targets.

Highest potential to improve accessibility - consistency of vehicle design.

Page 72

Business Case /If/al),sis for Ihe Polenlinl Tral1~fer of Lower-Ticr Municipal Tral1sit Services 10 Ihe Regional Municipality of Durham Octobcr 2004

TABLE 8.1 ASSESSMENT OF TRANSIT ORGANIZATIONAL ALTERNATIVES

CRITERIA STATUS QUO ENHANCED STATUS QUO Provide mobility • Limited change to existing • Limited change to existing • choice conditions. conditions

• No opportunities for choice in rural • No opportunities for choice in rural and developing areas. and developing areas

•

Improve service • Local focus is on cost containment. • Local focus is on cost containment. • levels • Option least likely to result in • Some improvement to selvice levels

improved service levels for local - still a strong focus on cost residents. containment rather than selvice

improvement. Satisfy demand for • No change. • No change. • school trips

Achieve equity in • Decisions made at a local level. • Decisions made at a local level. • . . service proVISion • Unlikely to achieve consensus and • Unlikely to achieve consensus and

equity across Region. equity across Region.

AMALGAMATION

Highest potential to provide viable choice to auto travel for some trips within Durham and from Durham to other locations Potential to provide choice in rural areas albeit limited at first. Highest potential to improve service levels and consistency across the Region - including service to rural areas.

Enhances opportunity to prove additional school service - greater levels of inter-municipal travel. Highest potential to achieve equity in service provision relative to population and density etc.

Page 73

Business Case Analysis for the Potential Transfer of Lower-Tier Mllnicipal Transit SenJices to the Regional Municipality of Durham October 2004

TABLE 8.2 COMPARISON (EVALUATION) OF SERVICE DELIVERY OPTIONS

FACTOR/CRITERIA STATUS QUO ENHANCED

STATUS QUO AMALGAMATION

PROVIDE 1\.1\ I~TEGRATED TRANSIT NETWORK

Potential to increase inter-f\ (~ e municipal ridership : ~ \J

Potential to increase inter- t. C) e regional ridership '~

Potential to increase local

ct a e ridership

Increase convenience to Durham ,~ C) a Residents ''----./

Facilitate higher order transit (\ [~, a service in the future (BRT, LRT) 0 "'-./

Enhance integration with GO ,~ ~ --Transit \J \J

Potential to achieve uniformity of ,~ () e standards "'-./

PROVIDE ACCESS FOR ALL ARE \S & SECTORS OF TilE CO:\Bn ':\ITY

Potential to develop conventional (\ (-\ services in rural areas V "----./'

Seamless travel for patrons of ~ ~ specialized service

DEVELOP .\ SYSTE:\I TII.\'I' IS .\FFORIHBLE & EFFICIE:\T

Facilitate more balanced investment in transportation f\ I~ () infrastructure (road congestion)

'~ '''----./

Economic Benefits /. /". --'--~ ~

Ability to compete with the auto .-----. /'. a for some trips. '------/ '-/

Ability to achieve fare integration , --, /. e across the Region '" ,./ '------/

Page 74

Business Case Analysis for the Potential Transfer of Lower- Tier MuniCipal Transit Services to the Regional Municipality of Durham October 2004

TABLE 8.2 COMPARISON (EVALUATION) OF SERVICE DELIVERY OPTIONS

ENHANCED FACTOR/CRITERIA STATUS QUO

STATUS QUO AMALGAMATION

Ability to attract sustainable 0 0 ~ upper-tier government subsidies

Ease of implementation e ~ ()

HR and labour impacts e () ~ FACILITATE THE DEYELOP'IE:\'T OF A LIYABLE & E:\,YIRO~'IENTALLY SlISTAE\'ABLE COl\L\R;\ITY

Environmental benefits 0 ~ ~ Achieve Regional mode share 0 ~ e objectives (TMP)

Community and social benefits 0 ~ ~ Facilitate transit supportive

0 ~ ~ growth patterns (development aspirations) Consistency with provincial

0 ~ e growth management policies/strategies

Ability to contribute to reduced 0 ~ ~ levels of traffic congestion

SA TISF\ Pl HLle DEi\L-\;\,D & CLlEl'iTS l\EEUS

Ability to improve ~ ~ e marketing/information

Monitoring/Accountability ~ ~ ~

Improve accessibility to transit 0 ~ ~

Provide mobility choice 0 ~ ~

Improve service levels 0 ~ ~

Page 75

Business Case Analysis for the Potential Transfer of Lower-Tier Mrmicipal Transit Services to the Regional Municipality of Durham October 2004

TABLE 8.2 COMPARISON (EVALUATION) OF SERVICE DELIVERY OPTIONS

ENHANCED FACTOR/CRITERIA STATUS QUO

STATUS QUO AMALGAMATION

Satisfy demand for school trips () () e Achieve equity in service 0 ~ 'it .. provIsIon

0 Poor • Excellent

An integrated transit system has been demonstrated to be necessary in order for the Region of Durham and the local municipalities to achieve the visions articulated in regional and Provincial policy documents. The evaluation of service delivery options as shown in Table 8.2 indicates that the preferred approach is to amalgamate all local conventional and specialized services into a regional structure funded and operated under the jurisdiction of the Region of Durham.

8.4 Conclusions

A number of municipalities within Durham are experiencing financial challenges that may well affect long term sustainable investment in transit. Each of the local operators have identified the need to acquire a number of new vehicles to replace an aging fleet. The vehicle replacement plan articulated by the local operators is not viable without significant increases in taxes or senior level funding, given historic spending on transit by the area municipalities/local operators.

An amalgamated transit entity funded and operated by the Region of Durham has the highest potential to:

• Achieve an integrated network characterized by higher levels of inter-municipal and inter-regional travel and overall increased ridership including seamless linkages on Highways 2 and 12, Taunton Road and Bayly StreetiVictoria Street;

• Provide conventional transit service for underserviced municipalities; • Result in expanded operations and seamless travel for specialized service patrons; • Facilitate more balanced investment in transportation infrastructure; • Achieve spin-off economic benefits to the community; • Attract sustainable and increased levels of provincial/federal government subsidies; • Result in a livable and environmentally sustainable community; • Achieve equity in service provision; and • Achieve public satisfaction and meet client needs.

An amalgamated transit entity funded and operated by the Region of Durham is:

• Most likely to be the best form to attract sustainable upper-tier government subsidies; • The best option in terms of moving towards a livable and environmentally sustainable community; • The option that is most consistent with provincial growth management policies/strategies; • The model that will best achieve equity in service provision; and

Page 76

BlIsiness Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

• The best model to achieve public satisfaction and meet client needs.

While it is acknowledged that public policy-making is not an exact science and there are clear arguments in favour of providing transit at both a local level and a regional level, on balance, and based on the assessment summarized in this section of the report, it is clear that from a qualitative perspective that there are significant reasons why regionalization of transit services is an appropriate initiative for Durham Region at this time.

Both conventional and specialized services, with the exception of the servIces provided by Brock Community Care, should be amalgamated under Regional jurisdiction.

Given geographical/spatial constraints, it is recommended that Community Care in Brock continue to operate specialized service in that township. Funding for the Community Care service should be provided by the Region. This service will be supplemented, on an as required basis, by the Region of Durham specialized vehicles.

It appears from recent initiatives across the GGH and from examination of other transit operations across Canada, that if transit services were being initiated for the first time in the Region, such services would likely be delivered on a broad basis as opposed to being provided by the local municipalities. In Durham Region this is most likely the case as the municipalities, although separated by artificial political boundaries, are merged as a result of development, other infrastructures such as roads and water and sewer, etc. In addition, and perhaps most importantly, the public or the users of any transportation service be it roads or transit, do not care about political boundaries and are only interested in seamless and cost­effective travel.

Provision of sustainable transportation obviously involves some tradeoffs including the fact that moving to a regional service may be perceived by local municipalities to reduce or eliminate their ability to be accountable to local residents or have the flexibility to ensure that services are provided into new development areas.

8.5 Part C Conclusions

The following conclusions from the review of the need and rationale and service delivery options are noteworthy:

• The benefits of transit go well beyond health and environmental considerations. In fact, transit has a wealth of economic benefits;

• Transit has more "value" to the community than the components of the network; • Transit "value" is also more than the ratio of the cost to provide the service and the revenues

generated from its operation (RIC); • Transit is more effective when operated as part of an integrated network and provides choice for

users; • Transit should be equally available to all sectors of the community at a similar cost; • More attractive service and integrated market share for transit are essential elements to increasing

ridership; and • The benefits or co-benefits of public transit although difficult to quantify, should be considered in the

context of the evaluation of any new services.

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Business Case Analysis for the Potential Transfer of Lower-Tier Municipal Transit Services to the Regional Municipality of Durham October 2004

From both a provincial and federal perspective, it is clear that transit will be the first priority for infrastructure investment. It is also apparent from recently released policy documents that new investments in transit are being considered by both levels of government.

Consideration of an integrated transit network in Durham, characterized by both higher levels of inter­municipal and inter-regional connectivity and service, is consistent with existing public policy and public sentiment.

The evaluation of service delivery options indicates that the preferred approach to transit service delivery is to amalgamate all local conventional and specialized services into a Regional structure funded and operated under the jurisdiction of the Region of Durham

Page 78