Toronto’s Ontario Line now costs $2B per kilometre. Why is building transit here so expensive?

Why is the Ontario Line so expensive?

Although that eye-watering price tag is in keeping with rising construction costs in other parts of the world, it also shows the need for more accountability and transparency in the budget for Ontario’s transit megaprojects, experts say.

At a press conference Tuesday to mark the completion of one phase of an unrelated transit project — tunnelling on the Eglinton Crosstown extension from Mount Dennis to Mississauga —Lindsay explained the reason for the Ontario Line’s rising costs.  

When Metrolinx first began construction on the line running from Exhibition Place to Don Valley, “we lived in a different world,” said Lindsay. “We’ve experienced one of the worst supply chain shocks in the last several decades, trade uncertainty.”

“It is absolutely true to say that the direct cost of these projects continue — whether it is fighter jets or transit or hospitals, or whatever it is — to go up,” Lindsay added.

Lindsay also warned that the budget for the much-needed Ontario Line is expected to climb further still.

In addition to the Pape and Cosburn contract, Metrolinx is still in the process of awarding a contract for the construction of the elevated section of the Ontario Line in the east end, after which “we will be able to stand back and do the math,” said Lindsay. He did not say how much that contract would be worth.

When the Ontario Line was first announced in 2019, the provincial government estimated that it would cost $10.9 billion and be completed by 2027. But that initial estimate was only for construction and did not include land acquisition or operational costs.

Subsequently, the COVID-19 pandemic and other delays pushed that timeline back to 2030, and then further to 2031, with publicly available budgets for the project climbing steadily. 

Metrolinx’s previous public estimate for the Ontario Line, posted in June, showed the price tag at $29 billion. 

Premier Doug Ford has previously blamed inflation for rising costs, while Lindsay has said that labour and supply costs have remained high for transit projects, and is an issue plaguing other jurisdictions, not just Ontario.

Transit project costs, and construction costs more broadly, have been growing for years, according to a U of T report from 2024. But that report also found that it cost taxpayers in the GTA significantly more to build subway lines and other transit projects, partly because of poor planning and a reliance on external consultants.

The long-delayed Eglinton Crosstown LRT, for example, was originally estimated to cost $9.1 billion in 2015, but by the time the line opened — nearly a decade past its original operating date — costs had grown to $12 billion. 

How Toronto compares to other cities

Jedwin Mok, the lead research of that report and a transit consultant, agreed that soaring material and construction costs that have plagued construction around the world, but said that wasn’t the full picture.

“We live in a bubble of English-speaking examples” when building transit, Mok said. “There’s very little curiosity to look outside of the English-speaking world for how to do stuff better.”

Mok pointed to Italy, where transit-building costs rose in the 1970s and 1980s, but were eventually brought down by anti-corruption and transparency laws.

North America has also suffered from a lack of expertise in the public sector, he added, which means private sector companies wary of working with ill-experienced governments add risk premiums to contracts, driving up the price.

Jonathan English, a Toronto-based infrastructure policy consultant, said that Toronto’s lack of transit-building for several decades has also meant that the city is playing catch-up — and paying for it.

“We’ve never built this much at once before and inevitably that leads to inflation,” he said.

What needs to change

The solution, according to both Mok and English, is more transparency on how Metrolinx and the government are spending the Ontario Line’s budget.

“It is very difficult for members of the public, researchers and others, to actually see how precisely this money is being spent,” said English. “We don’t know if there is one line item on it that is vastly bigger than it is in comparable jurisdictions.”

For example, Montreal’s 6-kilometre, fully-tunnelled Blue Line Extension is expected to cost about $1.4-billion per kilometre, according to NYU’s Transit Costs Project, while other Asian and European projects have costs as low as $123 million per kilometre.

Construction on the Ontario Line has already caused headaches across the city, through intersection closures, property expropriations, noise complaints and even rat infestations.

But despite the financial pain and disruptions caused by its construction, both Mok and English say that the new transit line will be worth the money.

“Our great-grandkids will thank us for the Ontario Line, I don’t have the slightest doubt about that,” English said.

“But if we could build at a somewhat more reasonable cost, we could have more Ontario Lines and more projects that our grandchildren will thank us for.”