TTC Seeks Increased City Funding for 2026 Budget and Fare Freeze

The Toronto Transit Commission (TTC) is requesting a larger subsidy from the city as part of its proposed $3 billion operating budget for 2026. This budget aims to freeze fares while also introducing a fare capping system. TTC CEO Mandeep Lali stressed that the organization is increasingly dependent on financial support from the city, which is set to rise to $1.48 billion, an increase of approximately $94 million compared to 2025.

During a board meeting on Wednesday, Lali highlighted the challenges facing the TTC, citing a persistent structural fiscal imbalance. He noted that this imbalance is attributed to escalating costs, lower than expected fare revenues, and slower growth in ridership. “We are increasingly reliant on the city subsidy and reserve funds,” Lali stated, emphasizing the financial strain on the transit agency.

The city will unveil its budget on Thursday, which includes the fare freeze and fare capping measures previously announced by Mayor Olivia Chow in late 2025. The TTC board is expected to vote on whether to submit its budget proposal to the city budget committee for official consideration. Notably, the city subsidy would account for nearly half of the TTC’s budget, with the agency also planning to draw $35 million from its reserves to maintain low fares. Fare revenue is projected to cover only about one-third of the budget.

The financial outlook for the TTC remains challenging. Interim Chief Financial Officer John Montagnese reported that the agency struggled to attract riders in 2025, resulting in fare revenue falling short of projections. “Return to office trends have not delivered the boost we anticipated,” Montagnese explained. Additionally, sales of student passes saw a decline, attributed to a drop in international student permits.

Anticipation is building that the upcoming 2026 FIFA World Cup may help increase ridership. The TTC’s fare capping initiative is positioned as a key benefit for transit users. This program would allow individuals to ride for free for the remainder of the month after taking 47 trips. Set to begin in September of 2026, this initiative eliminates the need for riders to pay upfront for a monthly pass, which costs $156.

While the first year of the fare capping program is estimated to cost the TTC about $3 million, the agency aims to reduce the cap to 40 rides in 2027. This adjustment would mean that riders commuting to work five days a week would enjoy free rides on weekends. The implementation of this proposal, starting on September 1, 2027, is projected to cost the TTC $14.7 million. By 2028, the full-year cost for the new cap would rise to $17.2 million.

As the TTC navigates these financial challenges, the emphasis on fare freezes and capping highlights the organization’s commitment to improving accessibility for Toronto residents while balancing its budgetary constraints.