TTC Seeks Increased City Funding for 2026 Budget Amid Fare Freeze

The Toronto Transit Commission (TTC) is requesting a larger subsidy from the city for its 2026 budget, which aims to maintain fare rates and introduce a fare capping system. TTC CEO Mandeep Lali highlighted the agency’s growing dependence on city funding, as the proposed operating budget of $3 billion requires an estimated $1.48 billion from the city, reflecting an increase of approximately $94 million compared to the previous year.

As Torontonians prepare to review the city’s budget on March 15, 2026, Mayor Olivia Chow has already announced plans for fare capping and a fare freeze as part of her affordability strategy. The TTC board is set to vote on sending its proposal to the city budget committee, marking it as the official submission for 2026.

While the city subsidy would account for nearly half of the TTC’s budget, the agency plans to utilize $35 million from its reserves to keep fares stable. Currently, only about one-third of the operating budget is anticipated to be covered by fare revenue.

“I must be candid about the challenges we face,” said Lali during the board meeting. “The TTC continues to experience a structural fiscal imbalance, driven by rising costs, lower than expected fare revenue, and slower ridership growth.” He emphasized the increasing reliance on city funding and reserve funds to address these challenges.

The TTC struggled to attract riders in 2025, concluding the year with fare revenue below expectations. John Montagnese, the interim chief financial officer, noted that anticipated boosts from returning office workers did not materialize. Additionally, sales of student passes declined due to a reduction in international student permits.

Despite these challenges, the TTC hopes that the upcoming 2026 FIFA World Cup will help increase ridership. The fare capping initiative, a significant win for transit advocates, will allow riders to travel for free after making 47 trips in a month. This program is expected to launch in September 2026 and would eliminate the need for upfront payment of the monthly pass, which costs $156.

The TTC projects that the first year of the fare capping program will incur costs of around $3 million. However, the commission plans to reduce the qualifying rides to 40 in 2027. If implemented, this change means that regular commuters could ride for free on weekends, provided they take the TTC to and from work every weekday. The adjusted proposal would begin on September 1, 2027, with anticipated costs of $14.7 million for that year, escalating to $17.2 million in 2028 when the cap would apply throughout the year.

The TTC board’s decisions and the city council’s forthcoming budget discussions will play a crucial role in shaping the future of Toronto’s transit system as it navigates financial challenges while aiming to enhance accessibility for its riders.