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LRT costs: was everyone on council on the same page?

LRT costs: was everyone on council on the same page?

In an online interview last month with Hamilton Chamber of Commerce President Keanin Loomis, discussing LRT, Mayor Fred Eisenberger stated, “(LRT) was always deemed to be a $3.5 Billion project, this whole notion that it was only a billion dollars was wrong at the get-go.” His remark raised the question of when did the Mayor know that the cost of the project had risen to $3.5 Billion. The figure first emerged publicly last December when the province announced cancellation of the project and released some cost estimates. Later the Mayor indicated that he had heard about the cost escalation about three months earlier but had discredited the suggestion as not credible and didn’t discuss it with council. The Bay Observer contacted Mayor Eisenberger asking: “In your streamed interview with Keanin Loomis on April 17, in a discussion of LRT you said “It was always deemed to be a $3.5 Billion project, this whole notion that it was only a billion dollars was wrong at the get-go.” Can you define “get-go” in terms of when you knew it was $3.5 Billion? I am directing the same question to members of council to find out when they knew.”

The Mayor replied: “I knew from the beginning that there was a capital cost and on top of that a life cycle cost as there would be for any capital project. Over the 30 year term of the DBFMO. (Design build finance maintain and operate procurement process)  I would say I may not have known the exact number but I was well aware it was many billions more over the thirty year term that would be refined and finalized through the procurement process. All deemed to be a provincial cost as part of the Metrolinx project owned and operated by the province of a Ontario… All identified, reported on to council and well known to all.”

For clarity we asked if members of council knew they were talking about anything other than a $1 Billion project throughout the years the project was up for consideration, obtaining the mayor’s response, “Yes. Either way it was approved by the province at no cost to the taxpayers save and except the day to day operating costs.” His response seemed to suggest that the province had agreed to pay the cost of LRT for Hamilton regardless of what that figure might end up being. The news accounts of the announcement of funding made by Premier Wynne in 2015 referred to the funding as “up to” a billion. Indeed, at the time of the announcement, the route was shortened to end at Queenston Circle, in order to stay within the  $1 Billion budget. Interestingly the province has pulled the news release of the announcement from its website.Later in 2017, when the project reverted to the full length to Eastgate, the Spectator wrote, “council voted to push ahead with the $1-billion LRT Wednesday after a last-minute provincial agreement to extend the eastern end of the line to Eastgate Square, rather than the previously approved Queenston traffic circle. But the promise from Transportation Minister Steven Del Duca didn’t come with extra cash…”

Members of council who have responded to enquiries by the Bay Observer all say they understood the capital cost was $1Billion. Coun. Brad Clark replied, “It was always capped at $1 billion. I am unaware of any (different) cost projections being provided to council until the Minister’s failed press conference in December 2019.” Councillor Arlene Vanderbeek wrote, “I always thought the budget was to be $1B.” Coun. Jackson replied, “MY understanding over many years of debate was a maximum $1B. CAPITAL was approved by the Wynne Provincial Government.” Councillor Whitehead recalled a $2 Billion figure—$1 Billion for construction and $1 Billion for borrowing. Actually, the provincial estimates released in December break down this way: $2.8 Billion for construction, $1 Billion for borrowing costs over 30 years, and another roughly $900 million for operating and maintenance which would be borne by Hamilton over a 30 year period.

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Also in the Chamber interview there was discussion about Bus Rapid Transit requiring a wider right-of-way which would necessitate a new Environmental assessment, which Loomis said would “take years” to complete. Actually, the province amended the EA regulations several years ago to place a six month cap for approvals on transit projects.

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  • Clearly these two so called representatives of the people mislead everyone regarding this money pit of a project. Had we known the final amount that was stated by the Ford Government there would have been a much larger public outcry. LRT is dead and we must move on by improving what we have before we create a second unsupported transit system.

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