A review of the TTC’s procurement policies is raising red flags about the transit agency’s ability to manage expensive capital projects, detailing billions of dollars in cost overruns and oversight practices that fall below public-sector standards.

The report, which will be debated at Wednesday’s TTC board meeting, was authored by consulting firm KPMG. The company examined nine capital projects that the TTC launched over the past decade-and-a-half and had combined initial estimated costs of $5.1 billion. Of the nine, six incurred inflated expenses that together totalled $2.9 billion more than original estimates.

They included the Toronto York Spadina Subway Extension, whose cost soared over from $1.5 billion to $3.2 billion, and the Leslie Barns streetcar facility, whose price jumped from $345 million to $507 million. Three of four smaller-scale capital projects KPMG studied also saw budgets rise above initial projections.

The report, which council commissioned in March 2015, determined that the TTC is operating at a “low-standardized level of maturity” in the delivery of capital projects. That’s below KPMG’s benchmark for public-sector organizations. KPMG scored one TTC department as operating at an “informal” level, which means the consultant found that projects lacked documentation and standardized policies.

Deputy Mayor Denzil Minnan-Wong, who sits on the TTC board, said he was “very concerned” by the review but that it “should come as no surprise.”

“This confirms the suspicion that we’ve all had about the capital program delivery in the TTC, that they’re underperforming,” he said.

According to the report, the most significant factor in the overruns was changes in project scope. Other factors include unscheduled delays and inaccurate assumptions made early on in the planning process.

The TTC’s projected capital budget is $9.5 billion over the next ten years, and the agency is also in charge of the $3.2-billion Scarborough subway extension. Minnan-Wong said that in light of KPMG’s findings he can’t guarantee Torontonians that the transit agency will use that money wisely.

“I can’t assure them because too many projects have come forward where the TTC has failed us,” he said.

Mayor John Tory’s office also signalled concern. “We simply can’t continue to have major transit projects — and other vital infrastructure projects — spiral out of control with escalating costs and delays,” wrote the mayor’s spokesperson in an email.

But in an interview Tuesday, TTC CEO Andy Byford said he welcomed the report because it “reinforces the work that we’ve been doing” to modernize the transit agency.

Byford was appointed in 2012, after most of the projects KPMG reviewed were underway, but before a majority of them were completed.

Since he took the job he’s stated that overhauling the TTC’s inner workings are among his top priorities. As evidence of his commitment, on Tuesday he pointed out that he has implemented a system of key performance indicators to measure numerous aspects of the transit system, created review boards that to chart project progress, and has instituted more transparent public reporting practices.

In 2014, he created a portfolio management office to standardize the delivery of capital projects, which KPMG acknowledged had improved procurement practices. The consultant report also noted that there has been a “significant change of tone” under Byford’s management.

“Are we squeaky clean? Absolutely not. Do we need to improve? Yes,” Byford said. But he added that “things can’t just change on a dime.”

“To be honest with you it’s a rolling process. By the end of next year it will look fundamentally different . . . We will have fundamentally changed our processes and our culture.”

The report made 41 recommendations to improve the TTC’s capital program, and Byford has endorsed them all. They include implementing a “stage gate” process that requires projects to be reviewed and approved at several points, as well as developing more holistic cost-estimate guidelines.

Matti Siemiatycki, an associate professor at the University of Toronto who studies infrastructure delivery, concurred that the report is further evidence that the TTC is “having problems delivering big projects.”

But he argued that its recommendations also lay out a road map for reforming procurement practices — which will be critical to gain public trust as the provincial and federal governments pledge to invest heavily in Toronto transit, and the city plans $14 billion worth of new lines.

“We’re at the beginning of a wave of infrastructure investment that’s going to transform our city. And the risk to public confidence if these projects continue to go over budget and continue to be delayed is significant,” Siemiatycki said. “We need to make sure that we’re getting these big infrastructure projects right.”

Some of the projects KPMG looked at

A new report from KPMG details how TTC projects tend to wind up costing much more than their initial estimates.

Toronto York Spadina Subway Extension

Initial estimate: $1.5 billion in 2002

Current estimate: $3.2 billion

Increase: $1.7 billion over 14 years

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Reason: 2.4 km of additional track, 3 additional stops, one major project reset, and expensive contractor claims

Toronto Rocket subway purchase

Initial estimate: $755 million in 2005

Current estimate: $1.2 billion

Increase: $417 million over 11 years

Reason: Adding 33 trains to the original order

Leslie Barns streetcar facility

Initial estimate: $345 million in 2011

Current estimate: $507 million

Increase: $162 million over five years

Reason: Contract award was delayed, scope of project increased to include landscaping, noise mitigation, and water main replacement

Subway accessibility renovations

Initial estimate: $355 million in 2011

Current estimate: $654 million

Change: $299 million over five years

Reason: Affected stations more complex than those renovated in earlier phases of the program