The vice-chair of the TTC board says it’s time for the agency to rethink its relationship with Metrolinx, after an audit determined the administration of the Presto fare card system has increased the risk of costly fraud on Toronto’s transit network.

A city auditor general’s report released Thursday determined the TTC lost at least $64 million to fare evasion and Presto malfunctions last year.

Previously documented reliability problems with Presto devices contributed to those losses. But Auditor General Beverly Romeo-Beehler singled out the program that allows children 12 and younger ride the TTC for free using special Presto cards as particularly open to abuse.

She found there were “serious control weaknesses” with the program, which have led to adults frequently and improperly using child cards to travel without paying.

TTC vice-chair Alan Heisey said Tuesday the city transit agency has limited ability to deal with those issues because Presto is owned by Metrolinx, a provincial organization on which the city has no representation.

“I think we need to change the agreement with Metrolinx, if it’s preventing us from doing some of the things (required to combat fare evasion),” Heisey said, following a meeting of the TTC’s audit committee at which the report was discussed.

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“I’d like the TTC to have more control over some of these issues,” he said, arguing the existing governance structure that keeps the two agencies separate is “not working.”

Among the problems the auditor raised was the fact child Presto cards look identical to adult cards, and don’t make a distinct sound when customers tap them on a fare reader, making it “impossible ... to spot (their) inappropriate use.”

And although parents are supposed to present their child’s I.D. in order to have the kids discount programmed onto a Presto card, the auditor reported her staff were able to buy child cards at a distributor without presenting identification. (The report didn’t name the distributor, but Shoppers Drug Mart has an exclusive deal to sell the cards.) The auditor found child cards are regularly being fraudulently sold online.

Even if TTC fare inspectors catch an adult rider using a child card, TTC employees don’t have the authority to confiscate the card because it’s considered property of Metrolinx.

Heisey called that arrangement “beyond strange.”

He noted the TTC also has no authority to stop Shoppers from improperly selling child cards to adults, because the chain’s agreement is with Metrolinx, not the TTC.

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“We’re the third wheel in that conversation,” Heisey said.

The auditor recommended the TTC consider suspending the use of child Presto cards until the problems can be rectified, but TTC deputy chief executive officer Kirsten Watson said there are no immediate plans to pause the program.

She said the TTC and Metrolinx are “good partners” and would work to “get suitable controls in place” as soon as possible. But she warned that if they are unable to do so the TTC will have to reconsider the use child Presto cards altogether.

“The issue of (an adult) being able to use a child card for free transit exists today, and that is not acceptable,” she said.

Metrolinx spokesperson Amanda Ferguson said its officials “work closely” with the TTC and other agencies that use the fare card system to “ensure Presto cards are being used properly.”

She said Metrolinx does cancel cards the TTC calls in to flag as having been used fraudulently, and the agency plans to “reinforce” with its distributor the need for customers to present child I.D. in order to set the discount.

The kids-ride-free policy was an initiative the TTC implemented in 2015 with the backing of Mayor John Tory, and he has routinely pointed to it as a measure his administration has made to make transit more affordable.

Tory’s spokesperson Don Peat said the mayor expected the TTC to take swift action on the auditor’s report, but fraudulent use of child Presto cards wouldn’t cause him to consider taking away kids’ free rides.

“We are not going to let those stealing fares ruin this policy for hardworking families,” Peat said.

Toronto transit expert Steven Munro said the jurisdictional disputes that have cropped up with Metrolinx and the TTC’s implementation of Presto should be seen as a warning about the problems that could arise if the Ontario Progressive Conservative government follows through with its contentious plan to “upload” Toronto’s subway. Under the province’s proposal, Ontario would take ownership of the subway network, while leaving its operation to the city.

“The whole business with Presto is like in miniature the issue you get into if you’re going to have Queen’s Park deciding what they’re really going to pay for and what they’re not going to pay for,” Munro said.

Ben Spurr is a Toronto-based reporter covering transportation. Reach him by email at bspurr@thestar.ca or follow him on Twitter: @BenSpurr

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