EXCLUSIVE: TTC, contractors behind the scenes fight over York-Spadina subway costs

By Cynthia Mulligan

The two years late and over-budget, the York-Spadina subway line will be extended by six stops this weekend with a grand, long-awaited opening.

On Friday, politicians, including Prime Minister Justin Trudeau, will celebrate with a ribbon cutting. But behind the scenes CityNews has learned there is a battle being fought between the TTC and the contractors who built the extension, which may mean the cost of the project will go up, again.

TTC spokesperson Brad Ross admits that’s a possibility.

“Well, we are continuing to negotiate with contractors,” he said.

And it is a bitter negotiation.

In 2015 the TTC acknowledged it bungled the project, fired two managers, and admitted the project was going to cost an additional $400-million, raising the cost of the York-Spadina subway extension from $2.6-billion to $3.2-billion.

Behind the scenes the construction industry is battling with the TTC over hundreds of millions of claims for unpaid work. It is the smaller sub-contractors who are suffering the most: they aren’t getting paid while the big general contractors wrangle it out with the TTC.

“People are losing their houses, companies can’t sustain so they’ll go bankrupt and the TTC is doing nothing about it,” said one of the tipsters, who spoke to CityNews on the condition his identity was protected.

They say the outstanding claims are worth over $1-billion. One let us examine his records and tells us he has spent $3-million on legal fees in the past 18 months fighting for tens of millions he claims the TTC owes him. He places the blame on TTC incompetence.

“They don’t know how to build anything and shouldn’t be allowed to build anything, they shouldn’t have their hand in anything.”

In 2015 KPMG wrote this report criticizing the TTC for its delivery on big capital projects.

The contractor showed us records revealing how the cost of the Vaughan subway station has steadily climbed.

In June 2015 it rose by $6.5-million. Five months later in November, it went up again by another $2.5-million and one month later, it rose another $2.4-million.

The TTC admits costs went up but doesn’t agree with all the claims made by contractors.

“We’re not going to pay for work that wasn’t done or work we don’t believe should be paid,” Ross said. “The TTC makes no apologies for watching taxpayers money very carefully.”

Ross says he is confident the claims will be settled and the price of the York-Spadina extension will not go up.

The final price tag for the project won’t be known until all the claims are settled. In the meantime, the small subcontractors won’t be paid.

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