OC Transpo withholds $15 million in payments due to LRT disruptions in 2023, report shows

OC Transpo withheld $15.1 million in payments to Rideau Transit Maintenance in 2023 due to maintenance issues and extended shutdowns on the Confederation Line.

A new report for the Finance and Corporate Services Committee on the city of Ottawa's 2023 budget spending shows the multi-million dollar "performance deductions" OC Transpo claimed when the light-rail transit system was out of service last year.

The O-Train line was shut down for 28 days last July and August after an issue was discovered with one bearing on an LRT vehicle during routine inspection. When service resumed, RTM was running single-car service along the line between Blair and Tunney's Pasture stations.

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LRT service was also disrupted twice in the winter and spring of 2023 due to freezing rain.

Staff say O-Train Line 1 performance reductions were $15.1 million in 2023. The report does not provide a breakdown on the performance deductions.

The $15.1 million in savings during LRT shutdowns was offset by $3.1 million in costs for R1 and R2 replacement bus service, according to the city.

Under the project agreement between the city and Rideau Transit Group, the city can withhold payments for service not provided along the Confederation Line.

"Normally, with the (project agreement) that we have we don't pay RTG when they don't deliver the service," Transit Services general manager Renee Amilcar told reporters during a media briefing on July 24, when the LRT was out of service.

"I want to assure the customers that we don't pay RTG when RTG doesn't deliver the service."

OC Transpo pays Rideau Transit Group/Rideau Transit Maintenance approximately $5 million a month to operate the Confederation Line.  

OC Transpo reported a $29 million operating budget deficit in 2023, mainly due to a drop in ridership.

The report shows the operating shortfall was offset by $27.79 million in "normal operational savings."

"The normal operation surplus was mainly attributable to reduced compensation expenditures from vacancies, lower O-Train Line 1 maintenance costs mainly due to the performance deductions per the project agreement with Rideau Transit Group, lower fuel costs and the delay of the opening of O-Train Lines 2 and 4 which were partially offset by higher Para Transpo service and fleet maintenance costs," the report says.