Latest News

Region to fork over more under new PRESTO deal

Durham to pay out approximately $20 million over course of 10-year agreement

The new PRESTO agreement with Metrolinx is set to go before regional council today (Dec. 6) at committee of the whole, with final approval set for one week’s time.

By Dave Flaherty/The Oshawa Express

A new agreement between Durham Region and Metrolinx could see final approval this week, resulting in the region forking over a significantly higher portion of its PRESTO revenue to the province.

It will see Metrolinx’s collection rate of PRESTO revenue climb from the current two per cent to four per cent in 2018, five per cent in 2019 and eight per cent in 2020, before finally settling at nine per cent between 2021 and 2027.

Part of the increase in fee rates is attributed to upgrades Metrolinx is planning for the PRESTO system, although Durham will not begin to pay for these upgrades until 2021 at the earliest.

Durham staff estimate the region will pay out approximately $20.7 million to the province over the agreement, with yearly payments jumping from $500,000 next year to $2.9 million in 2027.

PRESTO transactions currently represent about $9.3 million of annual fare revenue for Durham Regional Transit (DRT), although that number is figured to increase as more riders start to use the system.

Market penetration for PRESTO in Durham currently ranges between 30 and 40 per cent, almost double from four years ago, with a target of 80 per cent for 2021.

DRT general manager Vincent Patterson told The Oshawa Express he doesn’t believe the increase in money collected by Metrolinx will have any immediate effect on fares.

“It’s part of the overall expenses that we incur, same with fuel, same with keeping our buses in shape, so I don’t see an immediate direct cause and effect. It is something that is added convenience for the customers,” Patterson says.

Speaking at the Nov. 29 meeting of the region’s Transit Executive Committee, Patterson says the agreement “isn’t perfect” but is necessary for the region to continue to be eligible to collect provincial gas tax funds.

Durham’s share of provincial gas taxes for 2018/2019 is $8.2 million with the amount estimated to increase to $15.2 million in 2022/2023.

Under the new agreement, Metrolinx will continue to procure and install PRESTO equipment on behalf of DRT, although the region is responsible for the costs.

It is believed the region will need to spend $3.5 million to outfit some 195 buses in its fleet with new PRESTO equipment.

The agreement, first unveiled in March of this year and approved in principle by council in April, has proved to be highly unpopular with a number of councillors.

“We’ve caught ourselves in a situation where we’ve told individual transit users that by being loyal, by using PRESTO, you’ll save money,” Oshawa Councillor Amy McQuaid-England said at the time. “And now it seems that because our hands are tied and we don’t have the ability to negotiate and our gas tax is at risk, we have to agree to these terms and then we’re going to go back to the PRESTO users and say they have to pay more, which defeats the purpose of why we went on PRESTO to begin with.”

Ajax Councillor Colleen Jordan commented that it “sounds like we have a gun to our head, that we pretty much have to take this.”

Some councillors bemoaned the fact that the Toronto Transit Commission, a much larger agency than DRT, is only required to give Metrolinx a 4.65 per cent cut of its PRESTO revenue as laid out in a 15-year agreement signed in 2012.