The head of the TTC has acknowledged the agency could be forced to implement layoffs and additional service cuts if the COVID-19 crisis persists and senior levels of government don’t come forward with emergency transit funding.

In an interview with the Star on Friday, TTC chief executive officer Rick Leary repeatedly praised transit workers, who he said have been doing “an incredible job” keeping the city moving during the pandemic.

But he couldn’t rule out drastic measures in response to the staggering financial blow the outbreak has dealt the agency.

“Nothing, because of the financial situation that we’re in, is off the table,” he said.

Asked what could prompt layoffs and further service reductions, Leary said a prolonged crisis, a further drop in TTC ridership and an absence of new government funding would be the main factors.

“We know there are funding challenges right ahead of us … There’s a lot of decisions to be made in the near future,” Leary said.

Already the TTC has instituted cost-saving measures. The agency’s 2020 budget included $3.7 million to improve the reliability of its bus network, but Leary said plans to add service this year are now on hold.

Carlos Santos, president of Amalgamated Transit Union Local 113, which represents almost 12,000 TTC workers, said layoffs and service cuts would “really be concerning.”

“Our members would be extremely disappointed if (the TTC) did something like that after having us work in this situation and during this pandemic,” he said.

As of Monday, 24 TTC employees had tested positive for COVID-19, according to the agency. Dozens of employees have staged temporary work stoppages in the past week over concerns the organization isn’t doing enough to protect them.

Santos warned reducing service would only exacerbate crowding on the transit system, which would risk spreading the virus.

The TTC usually carries about 1.8 million people per day, but ridership has fallen by about 80 per cent since the start of the crisis, according to figures the agency provided last week. The TTC has reduced service by only about 25 per cent in an effort to allow residents who need to take transit to continue to do so, while avoiding potentially dangerous crowding.

According to the TTC’s interim chief financial officer, Josie La Vita, the agency has lost about $80 million in fare revenue since mid-March.

It has also incurred about $10 million in additional costs from enhanced vehicle cleaning procedures, the procurement of sanitary wipes, masks and cleaning products, and additional overtime for workers after absenteeism spiked at the start of the crisis.

Numbers the city presented Friday showed the TTC could lose about $439 million this year as a result of COVID-19, assuming physical distancing policies remain in place until June, followed by a six-month recovery period during which ridership increases but stays below pre-pandemic levels.

The loss would represent about one-third of all the fare revenue the TTC had expected to collect in 2020.

Most of the rest of the agency’s $2.1-billion operating budget is made up of a subsidy from the city, but the municipal government is facing more than $40 million a week in non-TTC losses and increased costs as a result of the crisis, and is legally prohibited from running a deficit. Mayor John Tory said Friday the provincial and federal governments will have to step in and help.

Other Canadian transit agencies are also in dire straits. On Monday, Vancouver’s TransLink announced it was issuing temporary layoff notices to 1,492 employees and further cutting service. The organization says it’s losing $75 million a month.

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The Canadian Urban Transit Association has estimated the country’s transit agencies could require $400 million a month for the duration of the crisis, plus up to $1.2 billion in “bridge funding.”

The federal and provincial governments have so far given little indication about whether financial help is on the way.

Chantalle Aubertin, press secretary for Canada Infrastructure Minister Catherine McKenna, said in a statement Monday the government is “aware of concerns about the ongoing operational costs for local (transit) providers,” but offered no details about potential federal assistance.

Christina Salituro, a spokesperson for Ontario Minister of Transportation Caroline Mulroney, said the provincial government is also “aware of the challenges” the TTC and other agencies are facing and is “reviewing potential options for supporting transit agencies across Ontario.”

For the moment, the city is making up the TTC’s revenue shortfall. City manager Chris Murray has said the municipal government expects to have sufficient cash flow to meet the needs of the city and its agencies until at least June 1.

In order to free up cash, TTC staff are reviewing the agency’s capital program, which is funded in part by $116 million in proceeds from the provincial gas tax, La Vita said. If some work was paused the city could reallocate that money to fund TTC operations.

Capital programs that could be delayed include non-urgent streetcar track work. Leary said the TTC intends to keep working on priority programs like subway signal upgrades and accessibility improvements.

The agency is already turning its attention to how the TTC will operate once the lockdown is lifted, Leary said. It is assuming a return to something resembling normal operations after Labour Day.

Although Leary has previously said he hopes to return service to pre-crisis levels, the CEO said Friday the goal will be to “match the capacity to the demand.”

“We’ve got to see what that future looks like. Will people want to get on buses and trains like they did in the past? You don’t know.”

He also said he hopes the crisis provokes a reassessment of the TTC’s reliance on fare revenue for roughly two-thirds of its operating budget, a portion that’s greater than other major North American transit agencies and that leaves the agency’s finances particularly vulnerable to drops in ridership.

“People will start taking a really hard look at how funding is provided to the TTC, because these are shocking times,” he said.