TransLink Board of Directors Report Package for December 8 ......TransLink Board of Directors Report Package for December 8, 2016 Open Board Meeting . ... Budgeted Contingency & Reserve

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TransLink Board of Directors Report Package

for December 8, 2016 Open Board Meeting

Public Delegations at the September 23, 2016 Board of Directors Meeting

BC Rapid Transit Company: President & General Manager Report for December 8, 2016 Translink Board Meeting

Coast Mountain Bus Company: President & General Manager for December 2016 Board Meeting

Transit Police Report: December 2016 TransLink Board Meeting

2017 Business Plan, Operating and Capital Budget

Budgeted Contingency & Reserve Policy Update - Accumulated Funding Resources

2016 Financial and Performance Report as at September 30, 2016

Rapid Transit Projects Update

Pattullo Bridge Condition Monitoring Update

Pattullo Bridge Replacement Project Update

Evergreen Rapid Transit Project Update

Implementation of Recommendations from the 2014 SkyTrain Independent Review

Elevator/Escalator Report and Presentation (for SRSC, and Public Meeting)

Transit Fare Review Progress Update

TO: Board of Directors FROM: Kevin Desmond, Chief Executive Officer DATE: December 1, 2016 SUBJECT: Public Delegations at the September 23, 2016 Board of Directors Meeting

PURPOSE The purpose of this memo is to brief the Board on TransLink’s responses to topics raised by public delegations at the TransLink Board meeting on September 23, 2016. BACKGROUND On September 23, 2016, the TransLink Board of Directors received five delegations on the following topics:

Complaints regarding noise levels near SkyTrain stations

Changes to bus route #49, contracting out bus services, use of double-decker buses, and increased SkyTrain service in off-peak times

Recommendation to increase HandyDART service levels and bring service delivery in-house

Need for accessible, public washrooms at Waterfront SkyTrain Station DISCUSSION Management has responded to the delegations as summarized below, and has shared copies of these responses with Board members:

Complaints regarding noise levels near SkyTrain stations: Management at British Columbia Rapid Transit Company, operator of SkyTrain, met with the public delegation immediately following the September 23 public Board meeting. They also met with concerned residents on October 3, October 7, and November 2 at specific SkyTrain stations to review noise levels at those locations.

Changes to bus route #49, suggestion to contract out bus services, use of double-decker buses, and increased SkyTrain service in off-peak times: Management has written a letter to thank the delegation for his suggestions, provide background information regarding the bus route changes and associated benefits, explain that TransLink currently has a mix of both privately and publicly operated bus services, advise that TransLink will consider double decker buses in 2017, and confirm that TransLink plans to increase SkyTrain services during peak and off-peak times in 2017 if the new 10-year investment plan is approved.

HandyDART service levels and service delivery model: Management has written to these delegations to thank them for their input and confirm that TransLink is undertaking a review of HandyDART services, policies and service delivery model. The results of the review will be brought forward to the TransLink Board in 2017.

Public Delegations at the September 23, 2016 Board Meeting December 1, 2016 Page 2 of 2

Accessible, public washrooms at Waterfront SkyTrain Station: Management has written to the delegation thanking her for her suggestions, explaining why washrooms have historically not been installed in SkyTrain stations, and advise that TransLink is in the process of reviewing our washroom policy.

CONCLUSION On September 23, 2016 TransLink’s Board received five delegations. Management has followed up with each delegation regarding their concerns.

PRESIDENT & GENERAL MANAGER REPORT FOR DECEMBER 8, 2016 TRANSLINK BOARD MEETING

STRATEGIC GOALS PROJECTS, INITIATIVES AND OUTCOMES Modernizing the Rail Division

Continued focus on rail maintenance to ensure a state of good repair: - In Q3 rail maintenance work continued to be performed on weekends, at night or

during non-revenue hours to minimize the operational impact on the system for passengers. Single-tracking around the work area is utilized to ensure that service can still be provided. o In September, the Guideway staff performed a full switch replacement at Waterfront

station. The department’s continued work on system switches is furthering their documentation and knowledge acquisition as part of their continued goal of modernizing their work practices. Train switches are critical system components and proper maintenance ensures our ability to deliver reliable service.

o The Engineering department acquired a contractor to grind the tracks throughout the system to restore the rail condition and reduce the noise level of our operation. With this effort, customer complaints related to elevated track noise should reduce significantly in Q4.

o Completed rail replacement of a curved section of track near Broadway Station. This replacement was in addition to the replacement of the S-curve section further west of the station, which occurred in Q1. Rail replacement work is critical to ensure our system remains in a state of good repair and enhances the ride quality experience for our customers.

Planning for Evergreen resources and operational impacts: - Evergreen Activation team has been heavily involved to ensure operational readiness

for the launch of the Evergreen Extension. In Q3 this involved: o Schedule – Identified and incorporated all the Evergreen related activities into an

integrated schedule to monitor completion on time for launch o Hiring – +80% hired and on track o Space – accommodating new staff in our existing space o Resources – Rail and TL procurement working closely together to make sure all

resources are available for a successful launch - Official opening date of December 2 for the Evergreen extension of the Millennium was

announced at a media event at Moody Station. To ensure a smooth startup, the Rail division has been conducting comprehensive trial running, running planned service schedules and operating patterns. Our operational readiness plans also include training drills and exercises with staff and emergency responders to ensure we are operationally prepared and ready to go for opening day.

Ensuring safety and security

Safety Management System: - The revised 2016 SMS has been completed and is currently under review with the Rail

division’s executive leadership team (ELT) and will be submitted to BCSA as part of the operating permit application.

Safety Video: - Working with TransLink Communications, the Rail division’s President & General

Manager, Vivienne King, produced a 4 minute video on safety while using SkyTrain. This video was shared externally by TransLink and is being used as a training tool for contractor safety.

Continue to support the development and implementation of the recommendations from the 2014 Independent Review to further strengthen our resiliency: - SkyTrain incident notification procedures have been agreed upon by municipalities and

Regional Transportation Management Centre. SkyTrain Operations manuals to be updated by Q4 to reflect the procedures. A test exercise may be conducted by year end.

Improving customer service and experience

Support enterprise initiatives to further improve customer service and experience, including: - Customer and performance focused leadership:

o In an effort to enhance the experience of passengers, the Rail division is actively recruiting a Director, Customer Service and Performance Reporting. This position will be responsible for the delivery of exceptional customer service, identifying areas of dissatisfaction and develop plans to monitor and continually improve the customer experience.

- Introduction of New Operating Pattern: o On October 22, SkyTrain a new operating pattern was introduced in preparation for

the opening of the Evergreen Extension of the Millennium Line. o The Rail division supported this pattern change by providing a subject matter expert

for media, and Facebook live events. o SkyTrain Attendants provided outreach by handing out brochures and interacting

with customers. o Rolling Stock staff stocked information brochures on trains and ensured new

operating pattern maps were installed on trains for the October 22 change. - Announcements:

o Continued to enhance announcements to provide improved information to passengers (particularly the Metrotown elevator information) and some chimes audio files were re-recorded for better quality.

- Increased visibility of SkyTrain Attendants and customer service initiatives: o Issued new blue fleece jackets that are more visible than the previous black version. o Wearing orange safety vests when STAs are dealing with non-customer service

issues such as clearing platform alarm. o Encouraging STAs and other Rail division staff to voluntarily wear name badges to

promote the enterprise’s customer first agenda. - Meet the Manager:

o Vivienne King held a “Meet the Manager” session at Waterfront Station on September 8. This event gave the public a unique opportunity to have their question personally answered by the Rail division’s President & GM, VP Maintenance, VP Operations and Director of Safety, Security and Support Services This session was complemented with an “Ask Me Anything” chat on a popular website the previous day.

- Media briefings: o Vivienne King has been representing TransLink as the media spokesperson for rail

related delays in Q3. Ms. King’s increased media presence has allowed the company to effectively communicate service delays to the public to ensure they are informed and know that issues are being addressed by the head of the Rail division.

1 On-time performance (OTP) is the measure of train trips delivered within 3 minutes and 5 minutes of scheduled departure for SkyTrain and WCE, respectively. SkyTrain OTP has been fairly consistent quarter to quarter. For the three months ended September 30th, OTP improved slightly to 95.4% from 95.2% in the previous quarter. The decline in OTP compared to the prior year is driven by an increase in trips delayed. The delays in 2016 are primarily attributed to increased train faults, manual driving delays and other unconfirmed intrusion alarms. Delays are continually monitored and issues are addressed. WCE year to date OTP of 97.0% was lower than target of 97.8% and 1.7% higher compared to prior year result of 95.3%. Increased delays during the third quarter, primarily associated with CP operations and, track infrastructure issues, resulted in a 0.8% OTP decrease compared to 97.8% for the six months ended June 30th.,

2 Prior year results are not directly comparable due to a revision of mystery shopper program in December 2015.

SkyTrain’s overall score has recovered from the declines last quarter due to overall improvements in stations, trains and contractor assessments. Transit Police and Maintenance Staff continued to earn full marks this quarter.

WCE 2016 results are strong with high scores in staff availability and having courteous and helpful staff.

3 SkyTrain had 17 lost time accidents (LTAs) of minimal severity in 2016, compared to target of 16 and 18 in 2015. Safety investigations are conducted for each reported injury and recommendations to prevent recurrences are implemented where practicable.

WCE has had no employee LTAs since 2000.

4 Consistent with the prior year, SkyTrain passengers experienced a total of 77 major injuries in the first nine months of 2016; however, this result is infavourably higher than target of 64. Slips and falls continue to have the most serious impact on SkyTrain passenger safety.

SkyTrain’s 2016 boarded passenger data from Compass of 70.9 million is significantly higher than target of 57.9 million, and prior year of 57.2 million.

WCE unfavourable variance of 0.23 compared to target was due to one passenger injury in 2016, compared to target of 0.75. Also, boarded passengers of 1.9 million were lower than target of 2.4 million.

∆ 2016 Expo and Millennium Line operating resultΨ of $98.7 million was favourable compared to the budget of $98.5 million due to additional overtime, additional state of good repairs and higher compass fare media costs offset by additional labour recoveries to support capital projects, timing differences in rail maintenance activities (i.e. rail grinding) and station coating at Royal Oak deferred to 2017. Total vehicle kilometres of 33.3 million were slightly lower than target of 33.6 million primarily due to the provisioning of vehicles for Evergreen Extension testing and commissioning.

∆∆ 2016 YTD West Coast Express operating resultΨ of $14.4 million was below budget of $15.3 million due to lower diesel prices, hydro, CP Rail contractual performance based adjustments, lower rail equipment maintenance and timing differences in station repairs. Total vehicle kilometres of 1.2 million were in line with target.

Ψ Operating results include allocated costs and exclude depreciation and any retail revenue or third party recoveries.

WCE allocated costs do not include rail car lease costs.

SkyTrain (excluding Canada Line) West Coast Express (WCE)

Key Performance Indicators YTD

Sep 2015 Actual

YTD Sep 2016

Target

YTD Sep 2016

Actual

Variance to Target

Fav / (Unfav)

YTD Sep 2015

Actual

YTD Sep 2016

Target

YTD Sep 2016

Actual

Variance to Target

Fav / (Unfav)

On-time performance1 96.1% 94.7% 95.4% 0.7% 95.3% 97.8% 97.0% (0.8%)

Overall mystery shopper score2 97.8% 94.0% 94.8% 0.8% 96.3% 87.6% 98.1% 10.5%

Lost time frequency3 4.05 3.20 3.22 (0.02) — — — — Major passenger injuries per 1m boarded passengers4 1.35 1.20 1.09 0.11 0.50 0.31 0.54 (0.23)

Operating costΨ per vehicle km $2.67 $2.94 $2.96 ∆ ($0.02) $13.73 $13.63 $12.91 ∆∆$0.72

Operating costΨ per passenger km $0.150 $0.165 $0.135 $0.030 $0.219 $0.181 $0.222 ($0.041)

PRESIDENT & GENERAL MANAGER REPORT FOR DECEMBER 2016 TRANSLINK BOARD MEETING

STRATEGIC GOALS PROJECTS, INITIATIVES AND OUTCOMES


• Safety Management System (SMS): Implementation is progressing on schedule with information sessions being held for Maintenance employees on all shifts at the maintenance facilities. Implementation of the SMS in the Maintenance Division is expected to be complete in Q1-2017 and for the rest of CMBC by Q1-2018.

• Safety Barriers: Six prototype operator barriers are now in service with the newest barriers from TCB (New Flyer) and Arow Global now being piloted. The Arow Global sliding barrier is receiving positive feedback from all user groups compared to the other models. CMBC continues to work on this initiative cooperatively with BC Transit and Brampton Transit.

• Refresher training exercises for CMBC’s Emergency Operations Centre are currently under way for Managers and Directors.

• Spills: To the end of July 2016, CMBC’s spill frequency was reduced from 9.3 spills per million km from same period in 2015 to 7.4 spills per million km in 2016, well below the target of 9.5 spills/Mkm.

• Transit Security continues to concentrate deployment on high volume and problematic areas throughout the transit system utilizing a detailed deployment plan combining information such as INIT (Innovation in Transport) fare not paid, passenger counts, pass up data and security reported incidents.


• Customer Information: The number and ratio of abandoned calls is down, the answer time and service level metrics have improved and more time is spent on social media and electronic notifications. The TransLink Twitter account reached over 125,000 followers in November.

• SeaBus: Beaver Refit and Otter Disposal – The final phases of the Burrard Beaver refit are in progress which covers fire and alarm panel upgrades, new interior lighting, paint and carpeting. Work will be completed at the end of November. Following final surveys and sea trials the Beaver is expected to return to service in December at which time the old Otter will be decommissioned.

• SeaBus: The Administration building, north and south Terminal envelope rehabilitation project construction is well underway. Work is progressing with no disruptions to staff or customers and is on target for completion by Q3 - 2018.

• Electric Bus Pilot: CMBC and TransLink are exploring the feasibility of the electric bus. • Bus Radio Replacement: The radio system is reaching end of life and requires replacement.

The system covers the radios on the buses, on the support vehicles and portables for the on-road supervision. Staff have received several proposals and a recommendation is expected in the early 2017.

• Trapeze provided a three day in house session to review the scheduling and dispatching processes along with a list of recommended actions to improve customer service such as proactive processes to improve on-time performance. All recommendations will be followed up and implemented.

• HandyDART trips provided by taxi have an on time performance rating averaging 86% system wide.

• The grace period for HandyDART customers requiring renewals (accounts inactive for 12 months) has been extended from two weeks to three allowing the customer additional time to complete the application with the medical authority while still being able to use the HandyDART service.

• Telephone access for out of town HandyDART customers has been improved by implementing a toll free telephone number.

• Access Transit Customer Care has seen a steady increase in calls, HandyDART and HandyCard registrations and Taxi Saver sales including: 15% increase in call volume; Continuing high new HandyDART/HandyCard registrations, averaging 600 per month,

including a 1% increase year over year; and 2.45% increase in Taxi Saver sales.

• Increases are believed to be due to the elimination of the Canadian Cancer Volunteer Driver program, the changes to the Province’s Annual Bus Pass program and the aging population.

• HandyDART continues to see increased demand for services and by year end, it is expected that 51,000 additional trips will have been provided over 2015.

Increasing ridership • Planning and preparation continues for the opening of the Evergreen Line. 75% of the routes in the NE Sector were improved to facilitate bus integration with the new rail service. Bus service will not change until December 19; however plans are in place to meet all trains during this period. Additionally, CMBC crews are currently installing over 1000 signs throughout the Northeast sector with information on the upcoming changes. All efforts are being made to minimize customer confusion, for example new route signs are being “hooded” and revealed only after the December 16th weekend, and CMBC/TransLink staff will be on targeted street teams handing out information and directing customers on and around opening days of bus and train service.

• CMBC undertakes a number of seasonal changes to reflect changing ridership. For the fall and winter sheets the following was implemented : Fall service levels are increased on routes serving post secondary institutions, including

UBC, SFU, Emily Carr, Kwantlen University, Capilano University. Dedicated school trips are reinstated to many senior secondary schools where regular

service is overcrowded by the students. Additional service is added to BC Ferries for long weekends and two weeks for

Christmas Holidays. A special two week Christmas service period is implemented to reflect ridership.

Service levels on routes serving post-secondary institutions are reduced as the schools are closed or in exam periods.

Additional service is scheduled for Boxing Day on routes serving major shopping destinations to meet increased.

Additional service is added for New Year’s Eve on routes meeting extended SkyTrain services so customers can use transit to travel to and from festivities.

Building a performance measurement culture

• September YTD, CMBC operating costs were $2.7M favourable and Contracted Transit Services (CTS) was $359K for a combined total of $3.0M favourable or 0.7%. Early in 2016 the bus fleet experienced higher than expected major failures and repairs. The opening of Hamilton Transit Centre in September and the Operations and Maintenance sign-ups resulted in a higher than planned movement of employees across the system between centres. Almost 1,000 transit operators required safety orientations and route training at new locations. Fuel market prices in 2016 have fluctuated but continue to remain below planned levels.

Building public trust and confidence in TransLink

• Sustaining service reliability by adding 22,000 annual service hours in January to address congestion.

• Special Events have added single bus stop closures into the TMAC system, which is updating RTTI (Real Time Transit Information) with more consistent and accurate data to improve the customer experience.

• Potable water consumption was down 20% from the previous year, in part due to a voluntary reduction in bus washing in the dry summer months.

Access Transit Historical Performance 2012 Actual

2013 Actual

2014 Actual

2015 Actual

2016 Forecast

Access Transit Operating Cost per trip $38.56 $39.92 $40.30 $39.83 $39.27

Access Transit Trips Provided (thousands)

HandyDART 1,187.4 1,137.5 1,094.5 1,104.9 1,119.3 Supplemental Taxi Service 21.5 43.9 74.4 99.9 130.4 Total 1,208.9 1,181.4 1,168.9 1,204.8 1,249.7

Key Performance Indicators Annual Target

SEP YTD Target

SEP YTD Actual Variance SEP YTD

Last Year Preventable Collisions per 1M kms (Rolling Year) 8.0 8.0 10.9 (2.9) 8.7

Employee Assaults per 1M service hours 0 0 20.8 2.3* 23.1 Employee Lost Time Accident frequency (incidents per 200,000 hours worked) 7.0 7.0 8.8 (1.8) 6.9

Spills per 1M Km 9.5 9.5 7.4 2.1 9.0 Customer complaints per 1,000 service hours 5.4 5.4 5.9 (0.5) 5.5 Customer commendations per 1,000 service hours 0.8 0.8 0.7 (0.1) 0.7 CMBC Planned Service delivered 99.5% 99.5% 99.45% (0.05)% 99.4% CMBC Operating Cost per Km (excl. fuel) $5.19 $5.20 $5.33 $(0.13)** $5.17 On Time Performance

Bus Regularity – frequent service 76% 76% 75.1% (0.9)% 76.0% Bus Punctuality – infrequent service 60% 60% 50.7% (9.3)% 50.4% Bus Departures – on time at first in-service stop 83% 83% 81.8% (1.2)% 81.8%

Access Transit Operating Cost per trip $40.52 $40.52 $39.08 $1.44 $39.80 Access Transit Trips Provided (thousands)

HandyDART 1,100.0 825.3 838.4 13.1 829.1 Supplemental Taxi Service 102.0 76.3 99.1 22.8 72.0 Total 1,202.0 901.6 937.5 35.9 901.1

* Variance is change year over year as 2016 target is zero. ** CMBC operating costs are higher than planned due to major bus failure repairs, operator route training

and staffing coverage. In addition to costs being higher, service levels are slightly lower than budgeted from cancellations and service adjustments with kilometers down 1.3%.

TRANSIT POLICE REPORT

DECEMBER 2016 TRANSLINK BOARD MEETING

STRATEGIC GOALS PROJECTS, INITATIVES AND OUTCOMES


Transit Police Training on Containment Tactics:

In support of the Transit Police Goal of providing a ‘safe and secure transit

system,’ a two-day containment training program was recently delivered to

Transit Police Officers.

The training involved instruction on how to effectively and safely control volatile

situations that could occur in a SkyTrain station, on board a train or on a bus.

Classroom lectures were delivered in the Coquitlam RCMP facility and the new

Inlet Station on the Evergreen extension was used to deliver the practical

scenarios. The Vancouver Police Department’s Emergency Response Team

provided instructional support on training to resolve high-risk incidents.

Coquitlam RCMP (9 officers) joined Transit Police Officers (131 officers) in the

training and Port Moody Police Department observed; the new Evergreen

extension runs through both of these police jurisdictions. The training included

being given high-risk scenarios to develop the police officers’ negotiation and

technical skills, and to gain self-discipline to function effectively in physically and

psychologically stressful environments. Excellent feedback was received on the

training and the Vancouver Police instructors also found the unique and

challenging transit environment interesting and a good learning opportunity.

Police Work Illustrations:

For this report to the TransLink Board, we are focusing on the importance of

keeping weapons and the persons who use these weapons to attack or threaten

our passengers or employees off the transit system. In October, suspects in

three separate offences involving weapons on the transit system were

arrested and held in custody for future court appearances.

1. On the morning of October 10, 2016, an empty Coast Mountain bus stopped

at Keefer Place - Vancouver for a layover en-route to Granville Island. A man

at the bus stop boarded the bus without paying and sat down near the

operator. The man pulled out a screwdriver and began playing with it, which

made the operator nervous as he was alone. The operator asked the man to

move towards the back of the bus. The man reluctantly moved back while

allegedly making threatening comments; however, moments later, he

walked to the front of the bus and allegedly struck the operator in the face

with the screwdriver before running off the bus. The operator suffered a cut

near his eye, bruising and swelling around the eye, broken eyeglasses and a

fractured cheek; however, he was able to call into CMBC dispatch to report

the assault. Transit Police was advised and commenced an investigation.

Video of the suspect was obtained and circulated to local police agencies

and a suspect was identified and sufficient evidence was obtained for the

Transit Police to recommend charges, resulting in the accused’s arrest in

Vancouver by a Vancouver Police beat officer. The suspect was remanded in

custody, pending his next court appearance on November 28th in Vancouver

Provincial Court. The suspect is well known to police as a chronic offender.

He is currently subject to three separate probation orders for convictions for

offences including Mischief, Theft, multiple Break and Enters, and Failing to

Comply with a Probation Order. This type of information sharing with

jurisdictional police is an important component of seamless policing in Metro

Vancouver.

2. On August 14, 2015, around 8:20 pm, a Coast Mountain bus stopped to pick

up passengers at 64th Avenue and Scott Road. A man boarded the bus

without fare and, when spoken to, allegedly sprayed the bus operator in the

face with bear spray. The man ran off the bus and allegedly threatened to

spray a citizen who gave chase, before leaving the area. The bus operator

suffered from the spraying symptoms for over an hour. As the spray

permeated the bus, all passengers had to disembark and wait for a

replacement bus. Transit Police were called and an investigation was

initiated which spanned 14 months, during which time a suspect was

identified but not located. In the afternoon of October 11, 2016, a Transit

Police Officer was travelling on the SkyTrain from New Westminster Station

to Columbia Station when she recognized the suspect from the bear spraying

incident. He was arrested at Columbia Station and found in his possession

was allegedly a quantity of drugs, an extendable baton, a butterfly knife and

a set of brass knuckles (a prohibited weapon). The suspect was 24 years old,

well known to police and with a lengthy history of violent offences. The

suspect was charged with Possession of a Controlled Substance, Carrying a

Weapon or Prohibited Device, Possession of a Prohibited Weapon and

Carrying a Concealed Weapon. He was remanded in custody pending his

next court appearance in New Westminster Provincial Court.

3. On October 15, 2016, at approximately 12:40 pm, a woman travelling

eastbound on the SkyTrain from Broadway/Commercial Station, noticed a

man seated nearby who was behaving oddly. He was twitchy and erratic in

his movements and she felt he might be under the influence of drugs. The

man stood in front of the woman when she stood for her stop at Metrotown

Station. As she waited for the doors to open, the man allegedly pulled out a

utility style knife and extended it toward the woman’s abdomen. He put the

knife away and then repeated the process just prior to the woman exiting

the train. Several witnesses got off the train with the woman and a SkyTrain

Attendant (STA) was advised of the incident. Transit Police were called and

attended to the woman. Transit Police Officers on duty at the 22nd Street

Station heard the radio broadcast concerning the suspect and his direction

of travel. These Officers boarded the train on its arrival and took the suspect

into custody without incident. A utility style folding knife was located in his

pocket as well as a number of tools in his backpack. The man was arrested

and charged with Assault with a Weapon. The suspect was 44 years old, of

no fixed address, and well known to police. This was his fourth alleged crime

of violence or threats of violence in the last four months and the second

alleged weapons-related incident in just over two weeks. He was remanded

in custody and is scheduled to make his next court appearance November

29, 2016, in Vancouver Provincial Court.

Fentanyl Crisis and Use of Naloxone by Police

Opioid overdose from prescription and illicit drugs is an important health issue

in British Columbia. Since 2011, there has been a progressive increase in the

number of illicit drug overdose deaths in which fentanyl was detected, either

alone or in combination with other drugs. Unintentional deaths and injury

from opioid overdose are preventable with the use of Naloxone (commonly

known as Narcan). Naloxone quickly reverses the respiratory depression

caused by opioids in an overdose. It is not a controlled substance, cannot be

abused, and in the absence of narcotics has no pharmacologic activity. There is

a multi-stakeholder provincial task force looking at the opioid overdose issue

in British Columbia.

In the course of duties as first responders, there are many instances where

police officers (including Transit Police) are first on scene or may be the only

first responder available to an event of opioid overdose. As first responders

and in the course of investigation, arrest or collecting evidence, police officers

are at risk of accidental exposure to dangerous opioids such as fentanyl

(inadvertently introducing fentanyl to mucous membranes by fingers/hands

touching eyes or nose). Exhibit custodians may also be at risk when handling

drug exhibits. Health Canada has given permission for Naloxone (Narcan®)

intranasal spray to be made available to police officers (and public) for quick

response to a known or suspected overdose pending arrival of BC Ambulance

or Fire Services. This would be for the purpose of both administering to

member of the public in the event of an overdose and a police officer in the

case of accidental exposure. There has already been several incidents of

exposure to police officers in BC, emphasizing the emergent need for

Naloxone to be available as an occupational health and safety measure.

Over the past few months, the BC Association of Municipal Chiefs of Police and

the Ministry of Public Safety and Solicitor General have been in discussion on

response to the opioid overdose health issue, including police use of

Naloxone. Further, on September 28, 2016, the Premier announced that $5

Million would be invested in issuing naloxone and training to police. Due to

the exigent nature of this health problem and occupational health/safety risk

to police officers, in November the Transit Police launched a training and

implementation plan for Naloxone Kits to be carried by its police officers while

on patrol (as well as use by trained personnel in the event of an emergency in

a police facility). The availability of this life-saving drug will have additional

benefit from the perspective of safety and emergency response to transit

riders and employees.


Compliments to Transit Police 1. Oct. 24/2016 from Loss Prevention Officer (LPO) re Transit Police Officers –

o Hi! I used your texting service today. It was excellent. Great response by

your members. I texted about a male that I've arrested in the past

during the course of my LPO job. Your members detained the male as

soon as he got off the bus at lougheed station. So thanks for the service

you all provide! Being able to text with a dispatcher and witness a police

response is both comforting and rewarding.”

2. Sept. 8/2016 from citizen re Transit Police Crime Reduction Unit –

o Tweet - a guy just broke into my car in front of undercover cops who

happened to be there, no damage & he's going to jail;

o Tweet - big props to @TransitPolice for their quick reaction, courteous

and professional help and support. You guys rock! 👍

3. Aug. 30/2016 from citizen re Transit Police Officer using sign language –

o Tweet - TransitPolice doing fare check on skytrain just thanked me in

#ASL. More of this please. #signlanguage TransLink #accessibility

Preventing Sexual Offending – New Campaign

Protecting and assisting vulnerable persons is one strategy within the Transit

Police Strategic Goal of “confidence in the use of public transit.” Preventing and

investigating sexual offences on transit is a priority within that strategy, and in

Q4 2016, a new public awareness campaign will be launched. This initiative is a

coordinated effort of Transit Police, TransLink and community partners. A copy

of the campaign poster follows. All reports of alleged sexual offences on transit

are investigated by the Transit Police.

Increasing ridership

Project Hot Wheels

Currently, bike thefts are one of the top property crimes occurring across Metro

Vancouver and local police agencies operate Bait Bike programs to help combat

this growing issue. Bike theft can also occur around SkyTrain stations and bus

loops. Accordingly, the Transit Police launched Project Hot Wheels. The Transit

Police acquired two high-end bait bikes which were deployed by the Transit

Police Crime Reduction Unit (CRU) between July and September 2016. During

the project, the bait bikes were deployed at the following stations: Surrey

Central, Gateway, Lougheed, Yaletown, Bridgeport, Metrotown,

Broadway/Commercial, Waterfront and Scott Road. Within a total of 11

deployment days, this crime prevention initiative resulted in 7 people being

arrested and 13 criminal charges being forwarded [(6) Theft under $5,000, (4)

Breach of Probation, and (3) Breach of Recognizance].

Several of the individuals arrested were chronic property offenders who were

already on some form of a conditional release. The arrests of these individuals

resulted in a number of them being held in custody for several days or weeks,

and those that did not have conditions now have conditions that will attempt to

limit their criminal activity. This type of project has positive impact for those

transit riders who choose to use their bike for travel in coordination with transit,

as well as for addressing general crime prevention and safety on and around the

transit system. Operational intelligence was gained through the project and

related arrests, and the Transit Police plans to continue to strategically deploy

bait bikes.

Building a performance measurement culture

KPI Snapshot

The Transit Police gathers comprehensive statistics for crime and organizational

performance purposes. We provide the TransLink Board with our annual Report

to the Community and other specialized statistical/trending reports as relevant

to issues. Moving forward, we also plan to provide a quarterly KPI snapshot to

the TransLink Board through TransLink Chief Executive Officer’s dashboard

initiative.

Building public trust and confidence in TransLink

“Policing Moving Cities” - Urban Public Transit Policing and Security

Conference

In support of the Transit Police effort for continual improvement and

commitment to demonstrate excellence in public transit policing, and with the

support of TransLink, the Transit Police has entered into a partnership with the

Canadian Association of Chiefs of Police to host a conference on policing of

transit environments. The event will take place April 30 – May 2, 2017 in

Vancouver. The conference purpose is to:

o Educate and validate, how and why ‘moving cities’ are unique and

why they demand a unique style of policing;

o Better understand the environment; addressing sex offending on

transit, mental illness and suicide;

o Detecting, preventing and responding to terrorism;

o Opportunities for transit system officials/operators and police to

best collaborate to provide public safety;

o Optimum policing/security models for efficiency and effectiveness.

Speakers from North America and Europe will be presenting (i.e., British

Transport Police and New York City Police). The conference is targeting transit

and police executive.

TargeT audience• Police executives, managers and supervisors responsible for policing rail transit systems• Transit system executives, managers and supervisors• Government officials charged with decision making responsibilities on mass transit systems• Members of Police and Transit governance structures• Executives and managers of jurisdictional police departments that have Transit Police/Security working within their borders

approach• Scene setting

• Defining the unique challenges and characteristics of mass transit systems as opposed to a street landscape (psycho-social perspective)

• Policing delivery• Responding to the unique policing (safety and security) demands of transit systems

• Technology • How it might help us to be more effective and efficient

LocaTion of conference/ accommodaTionsFairmont Hotel Vancouver900 W Georgia St, Vancouver, BC V6C 2W6Urban Public Transit Conference Rate: $229 plus taxes per nightCall: 604-684-3131 or 1-800-441-1414 Room Block: Held until March 30, 2017 (prices are not guaranteed after this date)

regisTraTion fee$595 + GST ($624.75) (includes all plenary sessions, two breakfasts, two lunches and three refreshment breaks).

For more information regarding programming, registration or accommodations please visit the Canadian Association of Chiefs of Police Web site at www.cacp.ca. For those without internet access, please call 613-595-1101 for further assistance.

Twitter info: @CACP_ACCP

“PoliCing Moving CiTies” Urban PUblic TransiT – Policing and secUriTy conference

aPril 30 – May 2, 2017 VancoUVer, bc

objecTives

• Educate and validate;• How and why ‘moving cities’ are unique and why they demand a unique style of policing

• Better understand the environment;• Addressing sex offending on transit• Mental illness and suicide• Detecting, preventing and responding to terrorism• Opportunities for transit system operators and police to best collaborate to provide public safety• Optimum policing/security models for efficiency and effectiveness

pubLic cibLe• Dirigeants, gestionnaires et superviseurs policiers chargés de la protection des réseaux ferroviaires de transport en commun• Dirigeants, gestionnaires et superviseurs de réseaux de transport en commun• Responsables gouvernementaux chargés de prendre des décisions concernant les réseaux de transport en commun• Membres d’organismes de régie de services de police et de réseaux de transport en commun• Dirigeants et gestionnaires de corps de police qui ont des services de police ou de sécurité des transports en commun sur leur territoire

démarche• Mise en contexte

• Définir les défis à relever et les caractéristiques des réseaux de transport en commun par opposition aux réalités de la rue (perspective psychosociale)

• Travail policier• Répondre aux besoins particuliers des réseaux de transport en commun sur le plan des services policiers (sécurité et protection)

• Technologie• Comment la technologie peut nous aider à être plus efficaces et efficients

Lieu de La conférence/ hébergemenTHôtel Fairmont Vancouver 900, rue W Georgia, Vancouver (Colombie-Britannique)Tarif de la conférence transport en commun urbain : 229 $ plus taxes par nuitée Composez le numéro : 604-684-3131 ou le 1-800-441-1414 Chambres préréservées : jusqu’au 30 mars 2017 (les tarifs ne sont pas garantis après cette date) frais d’inscripTion595 $ + TPS (624,75 $) (comprend toutes les séances plénières, deux petits déjeun-ers, deux déjeuners et trois pauses-rafraî-chissements)

Pour tout renseignement sur le programme, l’inscription ou l’hébergement, consultez le site Web de l’Association canadienne des chefs de police à www.cacp.ca. les personnes n’ayant pas d’accès internet peuvent composer le 613-595-1101.

Twitter info: @CACP_ACCP

« lA PoliCe dAns les villes en MoUveMenT » TransPorT en coMMUn Urbain – conférence sUr les serVices Policiers eT la sécUriTé

dU 30 aVril aU 2 Mai 2017 VancoUVer (coloMbie-briTanniqUe)

objecTifs • Renseigner et valider

• Comment et pourquoi les « villes en mouvement » se distinguent et pourquoi elles exigent une approche différente des services policiers

• Mieux comprendre l’environnement• Lutter contre les délits sexuels dans les transports en commun• Santé mentale et suicide• Détection, prévention et intervention face au terrorisme• Possibilités de collaboration optimale entre exploitants de réseaux de transport en commun et police afin d’assurer la sécurité publique• Modèles de services policiers et de sécurité optimisant l’efficacité et l’efficience

TO: Board of Directors

FROM: Cathy McLay, Chief Financial Officer and Executive Vice President, Finance and Corporate Services

DATE: November 28, 2016

SUBJECT: 2017 Business Plan, Operating and Capital Budget

PROPOSED RESOLUTION

That the Board of Directors approves the 2017 Business Plan, Operating and Capital Budget as presented.

PURPOSE

The purpose of this report is to request the Board of Directors approve the 2017 Business Plan, Operating and Capital Budget.

BACKGROUND

The 2017 Budget and Business Plan was prepared in conjunction with the 2017-2026 Investment Plan. The assumptions used to develop the plan were presented to the Board in September 2016. This budget is the first year of the 10 Year Investment Plan that was approved by the Board and Mayors’ Council November 23, 2016.

DISCUSSION

The three main priorities for 2017, which are detailed in the Executive Summary of the report, are: Ensure State of Good Repair TransLink will proactively manage and maintain all assets in a state of good repair to ensure safety and reliability, optimize lifecycle costs, and enhance the customer experience.

Mobilize Mayors’ Vision We will successfully deliver the capital projects, service expansion and policy initiatives necessary to mobilize the Mayors’ Vision. Improve Customer Experience & Public Support With a customer first approach, we will build public trust and confidence in TransLink by focusing on growing ridership, engaging stakeholders and delivering the Mayors’ Vision.

Increased expenditures for continuing operations of $143 million (9.7 per cent) compared to the 2016 Q2 Forecast include the following: In 2016, the Evergreen Extension (EGL) was completed, Hamilton Transit Centre (HTC) opened and Compass was fully rolled-out. The annualized operating costs related to these projects are reflected in the 2017 budget.

2016 Business Plan, Operating and Capital Budget November 28, 2016

Page 2 of 2

Service expansion in 2017 includes 370,000 service hours of conventional transit and 65,000 trips for HandyDART service.

Increased Serviceo Evergreen Extension (BCRTC) $17 milliono Transit Police Officers to support Evergreen $1 milliono Rail $5 million – including 234,000 more service hourso Bus $22 million – including 137,000 more service hours

Mobilize Mayors’ Vision and 2017 Prioritieso MRN Capital $17 milliono MRN Bike $6 milliono TDM Growth $1 milliono Compass System improvements $1 milliono Capital Asset Management plan $1 milliono Project management, procurement and support staff for Mayors’ Vision $2 million

Hamilton Transit Centre $2 million

Contractual Increases and CPI $38 million

Amortization and Interest $30 million

One-time costs of $19.3 million are included in the 2017 budget, which include a contingency provision of $11.9 million per TransLink’s policy. Other items support the Mayors’ Vision such as rapid transit studies related to the Millennium Line Broadway Extension and South of Fraser Rapid Transit Projects, mobility pricing and Trip Diary planning and some support Translink’s corporate priorities such as technology projects, fare review, facility planning and brand strategy.

This budget moves us forward in delivering on Phase One of the Mayors’ Vision.

Increases in revenues for 2017 include:

fare increase in July 2017

increase in standard property taxes

increased ridership

growth in revenues from an increase in Vehicle Kilometres travelled

Risks associated with achieving budgeted results include:

not receiving the Federal Gas Tax Funds in a timely manner which could impact the timing ofspending on projects and on the revenue recorded under Transfers from Government;

commodity pricing such as fuel and fluctuating foreign exchange rates;

timing of Public Transportation Infrastructure Funding (PTIF);

elasticity resulting from planned fare increase; and

our capacity to deliver on service expansion and capital projects.

CONCLUSION

Management recommends approval of the 2017 Business Plan, Operating and Capital Budget.

Table of Contents

1. Executive Summary ...................................................................................................................... 3

2. 2017 Financial and Operating Summary ........................................................................................ 6

3. Key Performance Indicators and Drivers ....................................................................................... 8

Financial Indicators ................................................................................................................................. 8 Operating Indicators ............................................................................................................................... 9 Key Drivers ............................................................................................................................................ 11 Assumptions ......................................................................................................................................... 12

4. Consolidated Revenues .............................................................................................................. 13

2017 Budget Comparison to 2016 Q2 Forecast ................................................................................... 13

5. Consolidated Expenses by Segment ............................................................................................ 15

Bus Operations ..................................................................................................................................... 15 Rail Operations ..................................................................................................................................... 21 Police Operations ................................................................................................................................. 25 Corporate Operations ........................................................................................................................... 27

6. Investment in Capital Assets....................................................................................................... 32

2017 New Capital Program ................................................................................................................... 33 Active and Approval in Principle (AIP) Projects Underway .................................................................. 35 Capital Infrastructure Contributions .................................................................................................... 38

7. Changes in Financial Position ...................................................................................................... 39

Financial Assets .................................................................................................................................... 39 Liabilities ............................................................................................................................................... 39 Non-Financial Assets ............................................................................................................................ 40

8. Liquidity and Capital Resources .................................................................................................. 41

Cash Flows and Liquidity ...................................................................................................................... 41 Restricted Funds ................................................................................................................................... 41 Net Debt ............................................................................................................................................... 42

Appendix I – Consolidated Financial Statements ............................................................................... 43

Consolidated Statement of Financial Position ..................................................................................... 43 Consolidated Statement of Operations ................................................................................................ 44 Consolidated Statement of Changes in Net Debt ................................................................................. 45 Consolidated Statement of Cash Flows ................................................................................................ 46

Appendix II – Allocated Costs between Divisions ............................................................................... 47

Page 2

Caution Regarding Forward-Looking Statements

From time to time, TransLink makes written and/or oral forward looking statements, including in this document, and in other communications, in addition, representatives of TransLink may make forward-looking statements orally to analysts, investors, the media and others. Forward-looking statements, by their nature, require TransLink to make assumptions and are subject to inherent risk and uncertainties. In light of uncertainty related to financial, economic, and regulatory environments, such risks and uncertainties, many of which are beyond TransLink’s control, and the effects of which can be difficult to predict, may cause actual results to differ materially from the expectations expressed in the forward-looking statements.

Page 3

1. Executive Summary A PLAN FOR MORE TRANSIT AND BETTER ROADS TransLink is a large, complex organization with a wide-ranging mandate. Of the world’s major cities and regions, only Metro Vancouver, London and Paris integrate public transit and road planning under one central authority with its own streams of revenue. TransLink delivers a wide range of services and programs to plan and provide for the transportation needs of Metro Vancouver residents and businesses. This includes bus, SeaBus, HandyDART, three rapid transit lines (SkyTrain), and a commuter rail service. TransLink also owns and maintains a subset of the region’s bridges, and shares responsibility for the region’s Major Road Network with local municipalities. It is the largest transit service area in Canada, spanning 23 municipalities/electoral districts/First Nations areas in Metro Vancouver. Metro Vancouver is known for its livability, including a highly functional, integrated transportation network. But our region faces challenges, including overcrowding on our transit system, congestion on our roads, and another one million new residents expected to move to Metro Vancouver over the next 30 years. To meet the challenges of growth and congestion in a way that is affordable and fair, in June 2014 the Mayors’ Council on Regional Transportation developed the 10-Year Vision for Metro Vancouver Transit and Transportation (10-Year Vision). Founded on years of planning, the Vision identifies the new transportation services the region will need over the coming decade. Phase One of the 10-Year Vision is focused on increasing transit services and improving roads, cycling and walking infrastructure across the entire region. This Plan is the largest transit service expansion in the region since 2009. This is an important first step in creating the transportation system our growing region will need to meet future demand. The 2017 budget represents the first year of Phase One of the 10-Year Vision. With guiding principles to maximize ridership and encourage long-term ridership growth, the investments in the 2017 Business Plan, Operating and Capital Budget are supported by three priorities with the aim of increasing customer satisfaction, safety and service reliability. Investments are needed to support our aging system and maintain our reliable service; to prepare for population growth to ensure a livable region and to keep improving on our customer’s experience. PRIORITY ONE: ENSURE STATE OF GOOD REPAIR TransLink will proactively manage and maintain all assets in a state of good repair to ensure safety and reliability, optimize lifecycle costs, and enhance the customer experience. Objective 1: Continually improve the current record of safe and secure operations We will proactively manage our assets and activities in order to ensure safe, secure and resilient operations for our customers and employees.

Initiatives: 1. Implement an Asset Management (EAM) system for the enterprise 2. Develop and implement CMBC Safety Management System 3. Develop and implement an Enterprise Emergency Response Plan (EERP)

Page 4

4. Design, procure and build a new Pattullo Bridge in accordance with the Mayors’ Vision 5. Replace rail on Expo and Millennium Lines

Objective 2: Investing in the future of Rail Services We will focus resources on the continuous improvement of our people, business tools and structure to ensure a safe and reliable system.

Initiatives: 1. Implement the remainder of the recommendations of the 2014 Independent Review of

SkyTrain 2. Modernize systems and processes 3. Develop and implement a workforce plan to enhance the capacity and skills of employees

PRIORITY TWO: MOBILIZE MAYORS’ VISION We will successfully deliver the capital projects, service expansion and policy initiatives necessary to mobilize the Mayors’ Vision. Objective: Deliver regional transportation priorities We will successfully roll-out the Mayors’ Vision by implementing the early priorities (years 1-3) in the 2017 Investment Plan and establish the ground work for subsequent phases.

Initiatives: 1. Implement the early roll-out of the 10-Year Vision, both operating (all modes) and capital

(planning and delivery) 2. Initiate foundational work for the next phase of the Mayors’ Vision 3. Develop a Mobility Pricing Plan

PRIORITY THREE: IMPROVE CUSTOMER EXPERIENCE & PUBLIC SUPPORT With a customer first approach, we will build public trust and confidence in TransLink by focusing on growing ridership, engaging stakeholders and delivering the Mayors’ Vision. Objective 1: Improve TransLink’s Reputation We will build trust and confidence in TransLink through active customer and stakeholder engagement and a commitment to consistent, high quality service with an emphasis on safety.

Initiatives: 1. Develop and implement a comprehensive external Customer Experience Strategy 2. Deliver enhanced Compass experience through delivery of the next phase 3. Implement outcomes of Access Transit Service Delivery Review 4. Develop and implement Transit Police’s enhanced Public Safety and Community

Outreach initiatives 5. Develop and implement a brand strategy

Objective 2: Increase Ridership We will attract and serve more customers, meeting more of their mobility needs on both the existing and expanded transit system in order to support the regional objectives.

Initiatives: 1. Develop and implement a comprehensive Ridership Growth Strategy 2. Complete a Fare Policy Review 3. Expand mobility options to the region through rideshare, cycling, travel planning

services, and a possible pilot program for vanpooling

Page 5

Objective 3: Develop Employees We will empower our workforce to meet our customer service standard and corporate objectives.

Initiatives: 1. Develop and implement a consistent customer service program across the enterprise 2. Implement growth and development opportunities for potential successors through

succession planning 3. Develop and implement an enterprise wide E-Learning strategy

To deliver the priorities set in the 2017 budget, additional funding will be obtained through; Public Transit Infrastructure Fund (PTIF) funding, increased transit fares, increased property taxes, and the gain on sale of surplus property. The risk associated with these much needed funding sources include; timing of PTIF funding, higher than expected elasticity resulting from the planned fare increase, as well as our capacity to deliver on service expansion and capital projects.

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2. 2017 Financial and Operating Summary

TransLink receives approximately 31.1 per cent of its revenue from continuing operations from transit fares, with the remainder coming primarily from fuel and property taxes. This means that as TransLink expands its services, an increasing amount of funding from fares, taxation and other sources are necessary. Operating costs include expenditures related to the day to day delivery of bus, rail, SeaBus and Access Transit services; as well as maintenance and administration of our multi-modal transportation system. Expenditures include labour, contracted services, fuel, maintenance and materials, and administrative expenses.

The 2017 budget results in a $308.3 million surplus on a Public Sector Accounting Board (PSAB) basis. Excluding gain on disposal, the surplus is budgeted to be $158.6 million.

While total revenues are expected to increase by 14.3 per cent over the second quarter forecast of 2016, the funding generated from government transfers and proceeds from sale of surplus property are largely restricted for capital infrastructure investments. Operating revenues are expected to increase as a result of anticipated growth in ridership, tolled bridge crossings, a planned fare increase in July, property tax increases and fuel sale volumes.

Total expenses are expected to increase $124.9 million (8.3 per cent) over 2016 second quarter forecast mainly due to higher operating costs resulting from bus and rail service expansion including the

CONSOLIDATED REVENUES AND EXPENSES

Twelve months ending December 31 2015 2016 2017

($ thousands) ACTUAL Q2 FORECAST BUDGET Incr/(Decr) %

Revenue

Taxation 772,722 805,298 833,028 27,730 3.4%

Transit 511,445 536,565 558,910 22,345 4.2%

Government transfers 228,943 222,505 281,904 59,399 26.7%

Golden Ears Bridge tolling 48,444 52,197 55,744 3,547 6.8%

Investment Income 34,381 39,054 37,712 (1,342) (3.4%)

Amortization of deferred concessionaire credit 23,273 23,401 23,337 (64) (0.3%)

Miscellaneous 6,102 5,535 5,464 (71) (1.3%)

Sub Total Continuing Operations 1,625,310 1,684,555 1,796,099 111,544 6.6%

Gain on disposal 2,340 17,148 149,677 132,529 772.9%

Total Revenue 1,627,650 1,701,703 1,945,776 244,073 14.3%

Expenditures

Bus Division 643,484 654,074 691,289 37,215 5.7%

Rail Division 268,311 265,604 300,010 34,406 13.0%

Transit Police 33,136 33,630 36,921 3,291 9.8%

Corporate operations 80,866 91,814 101,158 9,344 10.2%

Roads & Bridges 71,246 74,895 103,244 28,349 37.9%

Amortization of Capital Assets* 168,290 185,020 209,286 24,266 13.1%

Interest* 167,902 170,417 176,301 5,884 3.5%


Corporate - onetime 32,053 37,150 19,290 (17,860) (48.1%)

Total Expenditures 1,465,288 1,512,604 1,637,499 124,895 8.3%

Surplus for the year 162,362 189,099 308,277 119,178 63.0%

* Amortization and Interest shown separately to facilitate analysis

Change

Page 7

Evergreen Extension. Also included in the 2017 Budget are costs related to contractual labour increases, inflation, state of good repair improvements, and costs related to investment in our key priorities.

Page 8

3. Key Performance Indicators and Drivers

Financial Indicators

TransLink’s unrestricted cash and investment balances reflecting accumulated funding resources available for supporting operations, are budgeted to increase by $35 million compared to the 2016 second quarter forecast. Planned capital spending during 2017 will result in a net increase of $367.2 million (7.5 per cent) in capital assets. Significant projects include conventional bus replacements, rail fleet expansion, station upgrades, rail infrastructure projects, and procurement readiness work for the Millennium Line Broadway Extension and the South of Fraser Light Rapid Transit (LRT) rapid transit projects. Net direct debt increases by $174.7 million (8.1 per cent) in 2017 to $2.3 billion due to increased long-term borrowing to finance capital assets including bus fleet replacements, SkyTrain fleet expansion and Station upgrades. Indirect P3 debt relating to the Canada Line and the Golden Ears Bridge contractor liability decreases by $26.8 million due to amortization and principal payments. The gross interest cost as a percentage of operating revenues remains consistent with the 2016 forecast, and is well below our policy level of 20 per cent.

FINANCIAL INDICATORS

2015 2016 2017

($ thousands) ACTUAL Q2 FORECAST BUDGET Change %

Unrestricted cash and investments 1

310,470 231,600 266,564 34,964 15.1%

Capita l assets 4,606,623 4,906,331 5,273,583 367,252 7.5%

Net direct debt 2

(1,989,934) (2,144,905) (2,319,640) (174,735) (8.1%)

Indirect P3 debt 3

(1,623,309) (1,597,898) (1,571,097) 26,801 1.7%

Total net di rect debt and indirect P3 debt (3,613,243) (3,742,803) (3,890,737) (147,934) (4.0%)

Gross interest cost as a % of operating revenue 4

12.4% 12.0% 12.0% (0.0%) (0.3%)

1 This represents the accum ulated funding reso urces as calculated under the SC B C TA A ct and is the am o unt o f reso urces available to fund future o perat io ns .

2 Inc ludes T rans link 's direc t debt, net o f T ransLink s ink ing funds and debt reserve depo s its

3 Inc ludes D eferred co ncess io naire c redit fo r C anada Line and C o ntrac to r liability fo r Go lden Ears B ridge

4 Operat ing revenue inc ludes trans it , taxat io n, GEB to ll revenue, o perat ing trans fers fro m P ro v inc ial go vernm ent and m iscellaneo us inco m e.

Page 9

Operating Indicators

Scheduled Transit Service

The targeted overall performance rating is to reach 8.0 within three years with improvements of 0.1 per year. Conventional system service hours are projected to increase 372 thousand hours. This includes the impact of the Evergreen Extension and bus and rail expansion service to reduce overcrowding and improve service reliability. The cost recovery ratio is expected to decrease by 1.3 per cent due to the cost of expansion service that takes time to achieve full ridership. The operating cost per capacity kilometre is expected to decrease 3.5 per cent due to increased service capacity resulting from Evergreen Extension and additional service expansion. Access Transit Service

Access Transit trips are planned to increase by 44 thousand trips (3.5 per cent) to provide increased service for passengers unable to use conventional public transit without assistance.

OPERATING INDICATORS

2015 2016 2017

Twelve months ending December 31 ACTUAL Q2 FORECAST BUDGET Incr/(Decr) %

Scheduled Transit Service

Overall Performance Rating (out of 10) 7.5 7.6 7.8 0.2 2.6%

Service Hours 6,254,648 6,351,577 6,723,506 371,929 5.9%

Cost Recovery Ratio 51.8% 52.5% 51.8% (0.7%) (1.3%)

Operating Cost per Capacity Km 1 $0.084 $0.086 $0.083 ($0.003) (3.5%)

Complaints per million Boarded Passengers 94.2 82.1 76.1 (6.0) (7.4%)

Access Transit Service

Number of Trips 1,204,788 1,243,889 1,287,500 43,611 3.5%

Operating Cost per Trip $40.64 $40.10 $39.81 ($0.29) (0.7%)

Number of Trips Denied 1,613 1,763 1,500 (263) (14.9%)

Operator Complaints as a percentage of trips 0.04% 0.04% 0.05% 0.01% 24.3%

Service Complaints as a percentage of trips 0.07% 0.07% 0.07% - -

Golden Ears Bridge

Crossings (thousands) 12,695.9 13,117.5 14,069.9 952.4 7.3%

Average Toll per Crossing 3.65 3.72 3.75 0.03 0.8%

Ridership (thousands)

Boarded Passengers 364,261 381,277 392,753 11,476 3.0%

Journeys 2 n/a 233,339 240,469 7,130 3.1%

Average Fare per Journey 2 n/a $2.30 $2.32 $0.02 0.9%

1 Includes operating costs of Bus, SeaBus, Expo & Millennium line, Canada Line, West Coast Express and Police,

and excludes depreciation and interest expense2 In 2016, a new ridership estimation methodology was introduced, therefore comparative historic figures are not available

Change

Page 10

Golden Ears Bridge

Golden Ears Bridge crossings are expected to increase 7.3 per cent over the second quarter forecast due to increased Vehicle Kilometres Travelled (VKT’s) in the region. The average toll rate per crossing is expected to increase 0.8 per cent due to a bylaw inflationary increase in July. Ridership

With Compass data now available, Journeys replaced revenue passengers as the new ridership metric;

therefore comparative 2015 actual figures are not available. A journey is considered to be a complete

transit trip using Compass fare media or other proof of payment, regardless of the number of transfers.

Journeys are considered a better metric than Revenue Passengers due to improved actual data

(Compass) and reduced dependence on assumptions in the new ridership estimation methodology.

The average fare per journey is expected to increase from the 2016 forecast by approximately 0.9 per cent from $2.30 to $2.32, due to a planned fare increase on certain products in July 2017.

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Key Drivers

Ridership Ridership is assumed to grow 3.1 per cent based on increased service hours, elasticity impacts of fare increases, fuel prices and employment growth. Evergreen Extension ridership expectations for 2017 and beyond are expected to increase over the first five years. In 2017, the Evergreen Extension contributes approximately 1.5 per cent of the 3.1 per cent growth anticipated in 2017. Households Household projections are based on estimates from BC Stats. BC Stats provides annual household estimates for the Metro Vancouver region. The number of households in the Metro Vancouver region is expected to grow by 1.7 per cent in 2017 when compared to 2016. Household growth impacts both fare revenues, and taxation revenues. Interest rates Interest rates for the budget are based on forecasts from major Canadian chartered banks and TransLink credit spread and issue costs. The 2017 short term and long term interest rates are similar to the 2016 second quarter forecast. Inflation Consumer Price index (CPI) growth assumption for the 2017 budget is 2.0 per cent based on the BC Ministry of Finance. Taxable fuel consumption Fuel consumption volumes are used to estimate fuel tax revenue. Fuel volume projections are developed using a Provincial forecast modified for specific characteristics in the Region. Fuel volumes are forecasted to grow by 2.3 per cent over the 2016 second quarter forecast. Current low prices in combination with a weak Canadian dollar and a surge in automobile ownership are believed to be driving a short-term increase in regional consumption. Hydro cost Electricity rates increased by 4 per cent in April 2016 per BC Hydro, and will increase by 3.5 per cent in April 2017 for an annualized rate of 3.63 per cent in 2017. Hydro costs impact propulsion power for SkyTrain and Trolley Buses along with facility utility costs. Rate increases take effect in April of every year. Gasoline and Diesel prices Fuel prices affect operating costs for buses as well as West Coast Express Trains. Fuel prices are estimated using US Energy Information Administration forecasts adjusted for Canadian prices, taxes and price differentials. Fuel cost includes the futures volumes and rates locked in through April 2017. Revenue Vehicle insurance Bus fleet insurance rates are expected to increase by 5.5 per cent on April 1, 2017 based on the expected annual increase from ICBC.

Page 12

Assumptions The following table highlights the financial impact of changes in key assumptions used to develop the 2017 budget:

ASSUMPTIONS SENSITIVITIES

RATE / Impact

VOLUME Change ($ mi l l ions)

Revenue

Regional Fuel Consumption mi l l ions of l i tres 2,262 1 per cent +/- 3.8

Ridership mi l l ions of journeys 240.5 1 per cent +/- 5.6

Golden Ears Bridge Cross ings mi l l ions of cross ings 14.1 1 per cent +/- 0.5

Expense

Diesel cost dol lars per l i tre 1.08 $0.10 +/- 4.0

Operational Diesel Use mi l l ions of l i tres 39.73 1 per cent +/- 0.4

Interest rate Short term 1.5% 0.5 per cent +/- 0.9

Long term 3.5% 0.5 per cent +/- 1.5

Inflation General 2.00% 0.5 per cent +/- 0.3

Materia ls 2.00% 0.5 per cent +/- 0.4

Electrici ty 3.63% 0.5 per cent +/- 0.1

Col lective Agreements Unifor 1 per cent + 2.9

COPE 1 per cent + 0.6

CUPE 1 per cent + 0.8

TPPA 1 per cent + 0.2

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4. Consolidated Revenues TransLink receives its revenue mainly through taxation, user fees and government transfers. Total consolidated revenues for 2017 are expected to be $1.9 billion, an increase of $244.1 million over the 2016 forecast. This increase is mainly due to sale of surplus property and government transfers, which are largely restricted for investment in capital infrastructure. Taxation, transit, and toll revenues are expected to increase by $53.6 million over the second quarter forecast.

2017 Budget Comparison to 2016 Q2 Forecast

Taxation

Taxation Revenues is comprised of fuel tax, property and replacement tax, parking rights tax and hydro levy. It accounts for 46.4 per cent of total revenues before gain on disposal. Fuel tax revenues for 2017 are estimated to increase $8.6 million (2.3 per cent) due to an anticipated increase in Vehicle Kilometres Travelled (VKT), offset by more fuel efficient vehicles and fuel leakage outside of the region. This growth trend is consistent with information from third-party retail sources. Property tax revenues are expected to increase 4.6 per cent. Revenues include an annual 3.0 per cent increase in property tax revenue from existing properties as well as property tax revenue from development and construction growth estimated at 1.9 per cent. The replacement tax portion remains at $18.0 million. Parking Rights taxation revenue for 2017 is budgeted to increase $3.0 million (4.5 per cent) over the 2016 forecast, reflecting increased VKT within the Metro Vancouver region, driving parking volume increases.

CONSOLIDATED REVENUES



Taxation

Fuel 356,834 376,000 384,564 8,564 2.3%

Property & Replacement 332,489 341,540 357,333 15,793 4.6%

Parking Rights 63,334 67,359 70,387 3,028 4.5%

Hydro Levy 20,065 20,399 20,744 345 1.7%

Transit 511,445 536,565 558,910 22,345 4.2%

Government transfers 228,943 222,505 281,904 59,399 26.7%

Golden Ears Bridge tolling 48,444 52,197 55,744 3,547 6.8%

Investment Income 34,381 39,054 37,712 (1,342) (3.4%)

Amortization of deferred concessionaire credit 23,273 23,401 23,337 (64) (0.3%)

Miscellaneous 6,102 5,535 5,464 (71) (1.3%)

Revenue Before Gain/(Loss) on Disposals 1,625,310 1,684,555 1,796,099 111,544 6.6%

Gain on disposal 2,340 17,148 149,677 132,529 772.9%

Total Revenue 1,627,650 1,701,703 1,945,776 244,073 14.3%

Change

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Transit Transit Revenue makes up 31.1 per cent of total revenues before gain on disposal; which includes fare revenue, program revenue and other transit revenue. Fare revenue consists of cash fares, discounted Stored Value purchases, as well as Day and Monthly Pass products. Program revenue includes Government of BC Bus Pass and U-Pass BC revenue. Other transit revenue includes advertising, rental, parking lot fees and fare infraction. Total transit revenue is expected to increase by $22.3 million (4.2 per cent) from the 2016 forecast. Fare revenues are expected to increase due to an increase in ridership from service expansion, the full year impact of fares gate closures which had a positive impact on fare revenue collected, and a planned increase in fares in July 2017 which have not been raised since 2013. The fare increase is 5 to 10 cents for single use products, 25 cents for day passes and $1.00 to $2.00 for monthly passes. Transfers from Government Transfers from government include funds received from Greater Vancouver Regional Fund (GVRF), Canada Line funding, Building Canada Fund, Public Transit Infrastructure Fund, and other miscellaneous programs. The total revenue from these funds is expected to increase $59.4 million (26.7 per cent) compared to the 2016 forecast mainly due to increased expenditures eligible for GVRF being undertaken during 2017 and the new Public Transit Infrastructure Fund. Golden Ears Bridge Tolls TransLink receives tolling revenue from vehicles crossing the Golden Ears Bridge. Tolling revenues for 2017 are budgeted to increase $3.5 million (6.8 per cent) over the 2016 forecast due to increased volumes and an inflation increase in July 2017. The increase is determined by the value of the all items consumer price index for Canada which is expected to be 2.1 per cent. Crossing volumes are expected to increase by 7.3 per cent based on historical observations of volume growth, vehicle registration data and economic trends. Investment Income The lower investment income is due to lower expected returns on sinking funds and unrestricted investment balances, although this is somewhat tempered by higher sinking fund balances. Risks and Challenges Risks related to transit fares include achieving ridership targets and customer behaviour for purchase of various fare products. With the proposed fare increase in July, there is a risk of higher elasticity resulting from; price and service quality with customers expecting more frequent and reliable service. Fuel tax volumes are unpredictable, as suppliers have up to 48 months to recover tax paid on exempt volumes or fuel resold outside the transit region. Market change in the price of crude oil, the USD/CAD exchange rate and the cost of transportation can also impact the amount of fuel tax collected and remitted to TransLink. The property tax budget includes new revenue from development and construction growth; the rate for 2017 is estimated at 1.9 per cent. If the 2017 actual rate is lower, a lesser amount of incremental property tax revenue will be received.

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5. Consolidated Expenses by Segment TransLink is responsible for delivering transit services, owns and operates five bridges, and provides operating and capital funding for the Major Road Network (MRN) and cycling in Metro Vancouver. With the anticipated increase in service across all modes, operating costs will increase accordingly. Total expenses are expected to increase $124.9 million over the 2016 second quarter forecast mainly related to bus and rail service expansion as outlined in the 2017 Phase One of the 10-year Vision, integration of the Evergreen Extension; road, public infrastructure and state of good repair improvements; and contractual labour and inflation increases.

Bus Operations Coast Mountain Bus Company (CMBC) oversees the operations of Conventional and Community bus service, SeaBus and Access Transit. CMBC currently operates a fleet of 1,450 Conventional and Community vehicles. SeaBus is also a key component of Metro Vancouver’s transportation system carrying over 6 million passengers per year or on average 23,000 passengers per day. Within the Bus Division, CMBC administers the contracts for HandyDART, West Vancouver Blue Bus and the contracted community shuttle operators.

Initiatives: Ensure state of good repair In 2017, CMBC will undertake the following initiatives to ensure safe and secure operations and keep our transit infrastructure in a state of good repair:

Continue to develop the Safety Management System (SMS) through 2017 and into early 2018, at which time it will be fully implemented across CMBC. Implementation in the Maintenance Division is expected to be complete by June 2017, after which the focus will shift to the Operations Division and remaining corporate areas. SeaBus successfully implemented SMS in 2015 as part of their regulatory requirements.

CONSOLIDATED EXPENSES BY SEGMENT



Bus Division 643,484 654,074 691,289 37,215 5.7%

Rail Division 268,311 265,604 300,010 34,406 13.0%

Transit Police 33,136 33,630 36,921 3,291 9.8%

Corporate operations 80,866 91,814 101,158 9,344 10.2%

Roads & Bridges 71,246 74,895 103,244 28,349 37.9%

Amortization of Capital Assets* 168,290 185,020 209,286 24,266 13.1%

Interest* 167,902 170,417 176,301 5,884 3.5%


Corporate - onetime 32,053 37,150 19,290 (17,860) (48.1%)

Total Expenses by Segment 1,465,288 1,512,604 1,637,499 124,895 8.3%


Change

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Following up on the 2015/2016 transit operator barrier pilot involving several protection barrier designs, CMBC and other stakeholders will evaluate the feasibility of barriers from safety, maintenance and customer service perspectives.

Complete safety reviews at five major bus loops/exchanges.

Undertake ongoing Power Smart initiatives to reduce costs, extend facility life and provide better staff working conditions. CMBC will continue to evaluate its operations for energy and cost savings opportunities and where feasible and cost-effective, retrofit projects such as LED lighting and waste heat capture will be pursued cooperatively with BC Hydro and FortisBC.

Replace the existing outdated electronic fareboxes with more cost efficient technology.

Replace key operational equipment such as trolley poles and wires, buses, hoists, facility roofs and support vehicles subject to capital program approvals and GVRF funding where available.

Carry out SeaBus facility and infrastructure retrofits.

Implement CNG fueling at Surrey Transit Centre and take delivery of more fuel cost-efficient CNG buses to replace retiring diesel buses.

Participate in and support key business system upgrades including:

Operator holiday signup system replacement

Daily Operations Management System (bus operator tracking and payroll) replacement

Transit Management and Communications’ bus radio system replacement

MyTime payroll data collection upgrade.

Mobilize Mayors’ Vision Through the Mayors’ Vision and investment plan, 2017 will see the first phase of the transit service increases with the implementation of annual service expansion for Conventional bus, Community Shuttle, SeaBus, West Vancouver, Contract Community Shuttle and Access Transit services.

For Conventional bus and Community Shuttle, the Bus division will implement over 200,000 annual service hours in phases over 2017. This will alleviate overcrowding and pass-ups and provide for improvements of bus service across the network. The 2017 budget provides for the following preparations:

Expanded service requires the doubling of transit operator recruitment and training efforts. Aside from the average annual attrition of approximately 150 operators, an additional 100+ operators will be required with seasonal sheet changes through 2017.

Short term use and deferred retirement of older buses to increase the bus fleet for expanded service. This involves the costs of storing, handling and maintaining these vehicles to keep them in service until they can be retired and replaced over the next 12 to 18 months.

Acquisition of additional vehicle onboard equipment for the expanded fleet including radios, Compass validators and fareboxes. The procurement must take into account the time from ordering through delivery and final installation on the fleet.

Hiring of additional support staff such as mechanics, service people, other associated trades and supervisory and administrative staff to support the expanded service.

Improved SeaBus service to deliver 15-minute/two boat service on Sundays year-round starts January 2017 and expanded hours of 15-minute service every day starts in September 2017. The fall increase will require additional crewing staff, repair inventories and safety training. The increase of 1,200 annual service hours equates to an 11 per cent increase in service levels.

Access Transit services will increase by 45,000 hours, equating to approximately 85.5 thousand additional trips over 2016 budget levels.

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The Mayors’ plan for additional future service increases requires initiation efforts in 2017 to acquire new fleet to replace the vehicles with deferred retirements and acquire a new third SeaBus. There is a time lag of up to 18 months to order and receive new buses and over two years for a new SeaBus.

Improve customer experience and public support In 2017, CMBC will undertake the following initiatives in support of the customer experience:

Improve wayfinding signage and schedules to provide customers with quicker and easier information access. CMBC will work toward displaying route name and numbers at all bus stops system-wide, as well as providing enhanced schedule information through Transit Information Panels at key bus stops, loops and exchanges.

Fine tune the integration of bus service with the Evergreen Extension.

Assess the viability of “double decker” buses and fully electric buses.

Complete a Bus Service Performance Analysis to more reliably deliver bus performance measurement and KPIs.

Continue the revised policy of installing Automatic Passenger Counters (APC) on all new replacement and expansion buses and deriving better information to further compliment the compass data.

Pilot luggage racks on buses that serve BC Ferries terminals.

Conduct regular bus and SeaBus interior cleaning inspection programs to ensure appropriate conditions for employees and customers.

Fully implement a Resiliency Plan to provide alternate fueling facilities and facilitate the movement of buses and staff in the event of a major event or service disruption.

Deliver a revised employee recognition program for length of service, safety and performance. A modern and flexible online points-based rewards service will form the basis of CMBC’s Employee Recognition Program, allowing for timely and meaningful positive reinforcement of corporate goals.

Conduct a comprehensive Access Transit Policy and Service Delivery Model review to identify opportunities to improve accessible or custom transit service delivery.

Access Transit will review the customer complaint process, provide more training to taxi operators, review Trip Denials and implement an account-based Compass card for HandyDART customers.

Risks and Challenges Service expansion will increase workforce planning, recruitment and training to fulfil new staffing requirements in addition to offsetting retirements and other attrition. The expanded service introduced through the year will require more transit operators, maintenance staff and SeaBus crewing at the appropriate times plus have impacts on maintenance and service support areas for running a larger fleet with more kilometres. Difficulties in hiring certain key positions and skillsets continue to be a risk.

The early rollout plan requires using retired or scheduled to be retired buses in the short term to provide the required fleet and the timely procurement of additional on board equipment.

CMBC has a diesel fuel management strategy to attempt to mitigate market price changes and achieve budget stability by locking in up to 75 per cent of expected monthly fuel volumes for future months. West Vancouver purchases their fuel through the city and their municipal fuel supply arrangements. The other transit contractors participate in our fuel supply arrangement. Natural gas price supply agreements including locked-in volumes are currently in the procurement process. CMBC will be

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operating new CNG replacement buses in 2017, lowering diesel fuel demand and generating fuel cost savings over 2016. The known BC Hydro electricity rate increases for 2017 are built into the budget.

Abnormal inclement winter weather conditions and weather pattern variability could result in snow clearing, salting and other vehicle maintenance costs significantly beyond planned expenditures, which are based on long range average costs. CMBC’s locations include 35 loops, seven transit centre lots, SeaBus administration and three HandyDART locations. Each snow day can cost $125,000 for salting and snow clearing against an annual budget of $600,000.

Service Assumptions

The 2017 budget includes the first phase of the transit service increases of the Mayors’ Vision and Investment Plan. The 2017 service increase is over 200,000 annual service hours for conventional transit services including SeaBus and Contracted transit services and will require approximately 80 revenue vehicles. The 2017 service hour change of 138 thousand shown in the schedule above represents the

2015 2016 2016 2017

CONVENTIONAL TRANSIT ACTUAL BUDGET Q2 FORECAST BUDGET Incr / (Decr) %

SERVICE HOURS

CMBC Operations 4,687,022 4,770,418 4,770,442 4,901,828 131,386 2.8%

Conventional Bus 4,187,049 4,264,474 4,273,498 4,378,050 104,552 2.4%

Community Shuttle 489,040 494,983 485,953 512,199 26,246 5.4%

SeaBus 10,933 10,961 10,991 11,579 588 5.3%

Contracted Transit Services 236,910 238,659 237,986 244,237 6,251 2.6%

West Vancouver 134,306 135,265 134,684 138,792 4,107 3.0%

Contract Community Shuttle 102,604 103,394 103,301 105,446 2,144 2.1%

Conventional Transit 4,923,932 5,009,077 5,008,428 5,146,065 137,637 2.7%

SERVICE KILOMETRES

CMBC Operations 92,044,250 93,758,835 93,503,531 96,178,226 2,674,695 2.9%

Conventional Bus 81,960,814 83,308,088 83,340,835 85,420,886 2,080,051 2.5%

Community Shuttle 9,935,644 10,302,562 10,014,122 10,600,814 586,692 5.9%

SeaBus 147,792 148,185 148,574 156,526 7,952 5.4%

Contracted Transit Services 5,122,037 5,196,644 5,176,326 5,280,000 103,674 2.0%

West Vancouver 2,748,359 2,802,432 2,794,652 2,877,200 82,548 3.0%

Contract Community Shuttle 2,373,678 2,394,212 2,381,674 2,402,800 21,126 0.9%

Conventional Transit 97,166,287 98,955,479 98,679,856 101,458,226 2,778,370 2.8%

Change

2015 2016 2016 2017

ACCESS TRANSIT ACTUAL BUDGET Q2 FORECAST BUDGET Incr / (Decr) %

Service Hours 557,144 550,000 564,445 595,000 30,555 5.4%

Service Kilometres 8,868,485 8,745,500 8,991,574 9,520,600 529,026 5.9%

Total Trips 1,204,788 1,202,000 1,243,889 1,287,500 43,611 3.5%

Trips - HandyDART 1,104,937 1,100,000 1,119,938 1,185,500 65,562 5.9%

Trips - Taxi Supplement 99,851 102,000 123,951 102,000 (21,951) (17.7%)

Change

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current year fiscal impact which is lower due to the timing of when the actual service will be implemented. The other major impacts to service levels include:

The additional deadhead (pull in/pull out) for the full year of 2017 as a result of the opening of Hamilton Transit Centre (HTC) and the closure of North Vancouver and Oakridge Transit Centres in September 2016, and the reassignment of service to HTC and other depots.

Annual service variations are based on the number of weekdays, Saturdays and Sundays in a calendar year, with scheduled service levels differing based on the day of the week. 2017 has one less day than 2016 (a leap year) and one less Saturday, partially offset by one extra Sunday, a net result of less total service.

Other non-expansion service adjustments for 2017 which contributed to the increased service levels include the reconfiguration of Burnaby’s Metrotown Loop and bus movements plus additional running time for general traffic congestion.

2017 Budget versus 2016 second quarter forecast

The 2017 Bus Division budget overall is $37.2 million higher than 2016 second quarter forecast; CMBC Operating is $33.6 million higher, the other contracted bus services is $1.5 million higher, Access Transit

is $1.3 million higher and corporate allocated costs is $0.9 million higher. For CMBC Operating the 2017 budget increase is a result of economic increases relative to the existing service as well as the costs of the expansion service. Contractual labour increases, higher employer-paid benefit costs, higher vehicle insurance rates and predicted fuel costs and applicable general and parts inflation equates to a $15 million increase. The expansion service accounts for another $15 million increase over the second quarter 2016 Forecast including the one-time vehicle road worthy repair costs, operator and other employee recruitment and training and additional maintenance, insurance and fuel for the added service kilometres.

Wages, salaries and benefits increased $21.2 million, which includes: o $9.4 million of contractual increases for Unifor and MoveUP (COPE) and other step and

merit pay progression increases o $1.7 million related to the full annual cost of deadhead and operator travel time from

the opening of Hamilton Transit Centre (HTC) in September 2016 o ($3.2) million decrease in overtime related to one-time route training in 2016 for the

opening of HTC. o $8.4 million for additional operator and other staff wages and salaries related to service

expansion.

BUS OPERATIONS BY CATEGORY



Administration 13,692 15,992 14,948 (1,044) (6.5%)

Contracted Services 68,407 69,757 72,382 2,625 3.8%

Fuel and Power 50,181 44,791 50,169 5,378 12.0%

Insurance 13,529 14,649 15,570 921 6.3%

Maintenance, Materials and Utilities 58,824 61,252 69,346 8,094 13.2%

Professional and Legal 2,226 2,474 2,580 106 4.3%

Rentals, Leases and Property Tax 12,840 13,208 13,176 (32) (0.2%)

Salaries, Wages and Benefits 423,785 431,951 453,118 21,167 4.9%

Total Expenses by Category 643,484 654,074 691,289 37,215 5.7%

Change

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o $4.0 million for higher employer-paid benefits as a result of contractual increases and service expansion.

Materials and Services costs are $7.2 million higher due to work-plan major bus component life cycle increases, parts inflation and the extra service kilometres.

The budget has a one-time $4.9 million repair cost to ensure the road worthiness of buses due for retirement that are being held short term for service expansion.

Vehicle insurance is higher as a result of increased insurance rates for 2017 plus the additional service kilometres.

Fuel costs increased $5.4 million due to expected higher 2017 fuel prices and the additional service kilometres.

For all Contracted Transit Services the overall 2017 budget is $2.8 million higher than the 2016 second quarter forecast. Access Transit is higher by $0.9 million due to contractual operator labour and maintenance increases plus the net financial impact of 2017’s additional services hours over the 2016 forecast service. Contracted Community Shuttle’s $0.3 million and West Vancouver’s $1.1 million increases are due to agreed contractor labour rate changes plus the expansion service hours impacting labour and vehicle maintenance costs.

Key Performance Indicators

2015 2016 2016 2017

PERFORMANCE INDICATORS ACTUAL BUDGET Q2 FORECAST BUDGET

Cost Per Service Hour excl Fuel

CMBC Operations 102.33 102.09 103.01 106.04

Contracted Transit Services 76.93 75.67 76.71 79.91

Cost Per Trip excl Fuel & Taxi Savers

Access Transit 37.86 38.37 37.67 37.20

Cost Per Revenue Hour excl Fuel

CMBC Operations 130.47 132.50 133.68 136.33

Cost Per Service Kilometres excl Fuel

CMBC Operations 5.21 5.19 5.26 5.40

Contracted Transit Services 3.56 3.48 3.53 3.70

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Rail Operations British Columbia Rapid Transit Company Ltd. (BCRTC), on behalf of TransLink, maintains and operates two of the three SkyTrain lines in Metro Vancouver — the Expo Line and the Millennium Line/Evergreen Extension (E&M), as well as the West Coast Express commuter rail service. In addition, BCRTC also manages the agreement with InTransit BC for the operation and maintenance of the Canada Line. The Expo and Millennium lines primarily operate out of BCRTC's Operations and Maintenance Centre in Burnaby. There is more than 900 dedicated staff who work in the areas of administration, engineering, maintenance, field and train operations to deliver this service. The Expo and Millennium lines connect downtown Vancouver with the cities of Burnaby, New Westminster, Surrey, Port Moody and Coquitlam. The Canada Line connects downtown Vancouver to the Vancouver International Airport (YVR) and the city of Richmond. The West Coast Express commuter rail service delivers trains that connect the cities of Mission, Maple Ridge, Pitt Meadows, Port Coquitlam, Coquitlam and Port Moody with Vancouver. The Rail division of TransLink currently provides 400,000 trips per day on 139 km of track, with a 95 per cent on-time performance rate. Ongoing investment in the rail network over the coming years will enable us to continue to meet the needs and expectations of our customers. With the Evergreen Extension to the Millennium Line opening before Christmas 2016, 2017 will be the first full year of operations with the new Expo & extended Millennium Line service pattern, making this the world’s largest automated train system.

Initiatives The Rail division is committed to its employees, the ongoing improvement of customer service, and supporting TransLink’s critical role of planning and managing the region’s transportation network. Over the next few years, BCRTC will complete the ongoing investments in existing rail services, successfully integrate the Evergreen Extension and prepare for additional service expansions in Vancouver and Surrey to better meet the needs of our customers. The rail division has aligned its 2017 focus areas and objectives in its Business Plan with those of TransLink to support an integrated approach to meet the ever expanding needs of people in the Metro Vancouver region. Ensure State of Good Repair In 2017, BCRTC will focus on the following areas to continually improve the current record of safe and secure operations and invest in the future of rail services:

Continually improve the record of safe and secure operations. o Develop and implement formal annual maintenance plans. o Implement asset management systems by the end of 2019. o Develop a ten year asset management plan for rail. o Improve and document maintenance standard operating procedures. o Improve performance reporting. o Update and transform safety management system to a comprehensive integrated

management system framework.

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Invest in the future of rail services by focusing resources on the continuous improvement of our people, business tools and structure to ensure a safe and reliable rail service.

o Update existing information technology platforms to support core business processes. o Develop knowledge transfer options for rail. o Develop a long term space optimization and upgrade plan. o Review current product lines and management thereof. o Develop an internal apprenticeship program.

Mobilize Mayors’ Vision Provide the rail elements required to deliver the regional transportation priorities.

Develop and update annual service plans for the rail group for 2017 service adjustments.

Procure and successfully commission MKIII vehicles.

Procure and successfully commission West Coast Express vehicles.

Work with Canada Line to define, procure and commission additional rail vehicles.

Support planning and design of identified, future line extensions and stations upgrades.

Improve customer experience and public support In 2017, BCRTC will focus on the following areas in support of the customer experience:

Improve the TransLink reputation through delivering consistent high-quality rail services with an emphasis on reliability, safety and customer service.

o Appoint the Director of Customer Experience and Performance to the executive leadership team.

o Contribute to the revision of the Customer Service Charter. o Develop and implement a benchmarking program. o Develop a quarterly report on customer complaints, compliments and comments. o Create a performance reporting unit to integrate the rail group performance. o Develop and implement a meet the manager program. o Establish and implement customer service performance indicators for rail. o Implement an enhanced public safety and community outreach programs. o Review front line staff uniforms.

Increase ridership by running a reliable, effective and efficient rail system that supports a great passenger experience.

o Using Compass data, access and alter service plans for off peak services for SkyTrain. o Debrief on all major service delays to identify issues and improvements to optimize

future service. o Explore creative and different options to bring non-users to the system.

Develop our employees to meet our customer service standards and objectives. o Conduct a training review to design and develop a model and change management plan. o Implement inter-departmental Customer First working groups. o Develop a consistent customer service plan for all staff. o Develop succession plans. o Develop service level agreements with TransLink for certain shared services.

Risks and Challenges A full assessment of the life cycle impact on fleet and rail from the increased services is not complete. Additional maintenance or expedited capital funding may be required. In the 2017 budget, additional staff were added to support vehicle and rail maintenance, including planners and schedulers. In future years, and with the enterprise asset management (EAM) system, the impacts from service level changes should be better measured and understood to allow more accurate life cycle costing and forecasting.

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Due to the aging infrastructure, random asset failures may occur resulting in service disruptions, higher maintenance costs and additional overtime. The maintenance response team, planning and scheduling team, as well as additional maintenance staff will manage maintenance activities associated with such failures to minimize service disruptions. Cost to operate and maintain new assets associated with the Evergreen Extension could differ from those budgeted. BCRTC will ensure effective warranty management of newly acquired assets and manage its overall budget. BC Hydro’s 2015 Rate Design Application filed with the BC Utilities Commission, if approved, would result in changes in Large and Medium General Service accounts. As a result, hydro costs, including the Canada Line performance payment, could differ from budget.

Service Assumptions Effective October 22, 2016, there were system-wide changes to the E&M Lines service patterns, headways and train types as part of preparations to open the Evergreen Extension to the Millennium Line in December 2016. Evergreen Extension service changes result in an increase of 6.6 million car-km (a 14.7 per cent increase) or 137,000 service hours and 817 million capacity-km, to the E&M Lines in 2017. The 2017 service plans for the rail division result in an increase in rail service of approximately 17 per cent compared to 2016 budget. The service kilometres and hours for each of the lines are as follows:

With the approval of the Mayors’ Vision, service level changes using the existing fleet will be implemented for all SkyTrain Lines in early 2017. This will be the first year since 2005 that customers will benefit from service expansion using the existing fleet:

Effective January 2017, Expo & Millennium Line customers will see an increase in peak service operation by a total of one hour and 15 minutes per weekday as well as improved weekend midday and early evening service. These changes result in an additional 2.7 million car-km in 2017 (annualized 2.8 million car-km).

2015 2016 2017

ACTUAL BUDGET BUDGET Incr/(Decr) %

SERVICE HOURS

Expo & Millennium Lines 1,095,946 1,111,634 1,335,911 224,277 20.2%

Canada Line 194,880 197,391 203,668 6,277 3.2%

WCE 39,892 42,504 37,862 (4,642) (10.9%)

Rail Division 1,330,718 1,351,529 1,577,441 225,912 16.7%

SERVICE KILOMETRES*

Expo & Millennium Lines 44,166,622 44,798,879 53,837,212 9,038,333 20.2%

Canada Line 6,275,136 6,355,984 6,558,090 202,106 3.2%

WCE 1,576,858 1,586,413 1,411,511 (174,902) (11.0%)

Rail Division 52,018,616 52,741,276 61,806,813 9,065,537 17.2%

*Service Kilometres are total (Revenue and Non-Revenue) car kilometres

Change

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Canada Line customers will also benefit from improved AM and PM peak services that result in an additional 0.2 million car-km in 2017.

While there are no immediate changes to service for West Coast Express’ commuter rail customers, TrainBus service will cease in early 2017 due to the opening of the Evergreen Extension and bus route changes, one of them being an extension to Mission. It is anticipated that the additional SkyTrain and bus services will meet the needs of this customer group.


The Rail division’s 2017 operating budget is $300.0 million and is $34.4 million, or 13.0 per cent, higher than the 2016 second quarter forecast. The annualized staffing and net operating/maintenance costs related to the opening of the Evergreen Extension to the Millennium Line account for $16.1 million of the 2017 increase. Other contributing factors include:

annualization of 46 new operating and maintenance positions (excluding the 120 staff for the Evergreen Extension) hired in 2016

rising staffing costs, including higher employee benefit costs

additional staff and maintenance costs to support state of good repair maintenance and related business analytics

2017 SkyTrain service expansions using existing fleet

transportation contractual services increases related to Canada Line and WCE

anticipated increases in diesel fuel and hydro

other inflationary increases

RAIL OPERATIONS BY CATEGORY



Administration 4,569 5,217 5,953 736 14.1%

Contracted Services 116,765 119,400 122,072 2,672 2.2%

Fuel and Power 12,752 13,174 16,465 3,291 25.0%

Insurance 4,246 4,259 5,065 806 18.9%

Maintenance, Materials and Utilities 33,654 36,731 41,334 4,603 12.5%

Professional and Legal 3,586 2,804 2,898 94 3.4%

Rentals, Leases and Property Tax 17,022 1,942 2,020 78 4.0%


Provision for Asset Valuation 612 - - - 0.0%


Change

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Police Operations Mandated by the Solicitor General as a Designated Policing Unit, the Transit Police preserves and protects the peace throughout the transit system. Working with local police services, each officer aims to prevent crime and offences against the law, aid in the administration of justice, and enforce the laws of British Columbia. The province established the Transit Police designated policing unit in 2005 as the first dedicated transit police service in Canada.

Initiatives In 2017, the Transit Police will focus on implementation of its new Strategic Plan composed of three Strategic Goals:

A safe and secure transit system;

Confidence in the use of public transit;

Regional services that enhance local policing and community safety.

Transit Police capital requirements include funds for the replacement of 8 vehicles which are at the end of their useful life, and for the replacement of the current analog radios with “next generation” radios as a new radio system will be rolled out in 2017 by E-Comm (Emergency Communications for BC Inc.), making the current radios obsolete. These capital initiatives are in line with TransLink’s first priority of ensuring state of good repair to help maintain reliability and safety for customers and employees. Transit Police’s Evergreen initiative involves the hiring of eight additional constables in order to manage the anticipated increase in police workload created by the Evergreen Extension. This initial deployment of resources will help to ensure that policing service on the Expo/Millennium Lines isn’t negatively impacted in order to provide policing on the Evergreen Extension. Ongoing analysis regarding staffing levels will continue to determine what the impact of the Evergreen Extension is on public safety and demands for police services. The request for additional resources for the Evergreen Extension ties into TransLink’s third priority of improving customer experience and public support by providing a safer system. Transit Police will monitor its achievements against its current Strategic Plan by observing key performance indicators grouped by the following five themes:

Reducing Crime

Strengthening Partnerships

Improving Safety

Increasing Productivity

Maintaining a Healthy and Diverse Organization

Risks and Challenges Maintaining sworn staffing levels in response to attrition and injury is a challenge. In the policing environment, there does not exist a casual pool of sworn officers available to fill vacant and injured positions. Hiring replacement officers is a lengthy process with the availability of suitable candidates varying greatly month to month. Unforeseen delays in hiring could lead to additional operational overtime costs. The opening of the Evergreen Extension will challenge current police staffing levels; a budgeted increase of eight officers will still require policing resources to be “spread thinner” on the rest of the Expo/Millennium Line in order for the Evergreen Extension to receive equitable policing services.

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2017 Budget versus 2016 second quarter forecast Police division costs have increased by $3.3 million mainly related to labour cost increases which include additional staff cost to support the Evergreen Extension.

POLICE OPERATIONS BY CATEGORY



Administration 2,338 2,213 2,483 270 12.2%

Insurance 36 40 45 5 12.5%

Maintenance, Materials and Utilities 1,173 1,044 1,431 387 37.1%

Professional and Legal 422 365 486 121 33.2%

Rentals, Leases and Property Tax 1,912 1,982 2,059 77 3.9%



Change

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Corporate Operations

Corporate operations will continue to support the operating subsidiaries in 2017, with a focus on achieving enterprise priorities, including mobilizing the Phase One Plan and ensuring procurement readiness for rapid transit projects. The strategic objectives of each corporate division are summarized below.

Planning Planning and Policy will lead the detailed system planning for the transit, cycling, walking and road investments included in Phase One of the Mayors’ Vision to ensure that the region’s residents can maximize the benefits of the expansion. Expedient resourcing and efficient process management will be key priorities to successful implementation. Planning and Policy will be leading the effort to approve Phase Two of the Mayors’ Vision which will include the rapid transit projects and Pattullo Bridge replacement. A key risk is securing adequate senior government capital contributions and regional funding sources to sustainably meet stakeholder and political expectations. To meet the evolving needs of the traveling public, Planning will be working on developing a new fare policy, advancing mobility pricing and improved travel planning.

Engineering Services

Engineering Services will oversee business cases, design, and implementation of infrastructure projects for the coming year. These projects feature state of good repair improvements on major assets across the transit system. In support of the 10-Year Mayors’ Vision, engineering staff will guide planning, design and procurement readiness for major projects including the Millennium Line Broadway Extension and South of Fraser Light Rapid Transit (LRT) rapid transit projects and the Pattullo Bridge replacement. An identified risk is the rising cost of construction material and labour, which makes project cost estimates a moving target. To ensure compliance with the 2014 Independent Review of SkyTrain, which identified causes of the major 2014 rail disruptions and provided 20 recommendations, Engineering Services will continue to lead those improvements. These recommendations will enhance the customer experience during transit service disruptions. Upgrades include rail operations, communications, safety systems, procedures and infrastructure. Nine of the 20 recommendations have been completed, with the remaining eleven being phased in over the coming years.

Human Resources Human Resources will continue to provide BCRTC with best practices resources in change management, organization design, job classification and evaluation. This will support modernizing the rail company’s procedures in maintenance, operations and training. Recruiting additional employees to deliver on the projects identified in the Mayors’ Vision will be both a priority and a risk in 2017 if skilled specialists are not found locally. Engineers, planners and other technical experts will be required to support projects such as the Pattullo Bridge replacement. Transit and shuttle operator recruitment must also be increased for bus service expansion in Metro Vancouver.

Page 28

Human Resources will enhance their Succession Planning Strategy on training, professional development, mentorship, recruitment and retention. This will help ensure valuable knowledge and best practices in operations, customer service and other areas are transferred seamlessly to new managers and staff.

Business Technology Services Business technology services will ensure an effective Enterprise Asset Management (EAM) tracking program is in place for SkyTrain network maintenance and refurbishment. Hardware and software components will be updated to sustain and extend current transit management and communications operations, prevent impact of system failure on daily bus operations and prepare for bus fleet expansion. To modernize our public channels and digital services, we plan to update the TransLink website foundation to deliver timely customer messaging in the event of service disruptions.

Strategic Sourcing and Real Estate Our Strategic Sourcing & Contracts Management team will continue to plan for and acquire goods, services and/or construction work on our assets by third parties, through a fair, open, and transparent manner. We also ensure the supplier relationship is professionally managed with value for dollar achieved. Priorities for 2017 include real estate acquisition for current and future projects, as well as managing lease agreements, property tax administration and appeals, property assets and right-of-ways. One of our key risks is the fluctuation in property pricing which puts pressure on overall project estimates. While managing commercial real estate initiatives, we will focus on customer service, financial results and ridership. From parking management to advertising opportunities on our assets and retail vendors renting kiosks at stations, the end goals are to expand revenue-generation and enhance the customer experience.

Legal Legal will be assisting with various capital projects (such as acquisition of new vehicles, transit exchange upgrades) and municipal funding agreements. As part of the Mayors’ Vision, Legal will support progress on the Millennium Line Broadway Extension and South of Fraser Light Rapid Transit (LRT) rapid transit projects, ensuring procurement, contract documents and Memorandums of Understanding are developed in time to meet the project schedule. Legal will also assist with development of future investment plans and potential legislative amendments to enable new or expanded funding sources. Another key priority for Legal will be supporting implementation of the Access Transit Service Delivery Review recommendations to improve the accessibility and experience of transit services for people with disabilities, seniors, new immigrants and young people. This work is guided by the feedback and needs of our customers.

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Communications and Customer Engagement Communications and Customer Engagement group supports every division across the enterprise, through internal communications to employees, the executive and board as well as externally: to passengers, the public, taxpayers, stakeholders and funding partners. We provide passengers and stakeholders with timely updates on major infrastructure projects across the system, such as station upgrades, rail maintenance, and implementation of the SkyTrain independent review or transit service changes. Clear communications about service impacts are conveyed with plenty of notice through all media, social media channels plus digital marketing, including our website and paid advertising. All public-facing marketing, communications and wayfinding material is clear, easy to understand and integrates stakeholder feedback for constant improvement. Our marketing and consultation group solicits public feedback to help prepare our customers for service improvements as part of the 10-Year Mayors’ Vision among other strategic priorities, such as the 2017 fare increase, Pattullo Bridge replacement and the two major rapid transit projects. A new initiative underway for 2017 launch is the Customer First Charter to provide optimum service levels to our riders and the general public. Building on the TransLink brand, we aim to consolidate our communications and storytelling to achieve higher public awareness of enterprise achievements. We will maintain a consistent, proactive and transparent approach to social media and media relations.

Finance and Compass Operations

Financial Services will be focusing on a number of initiatives that support the corporate priorities and deliver on our commitments in Phase One of the 10-Year Vision. These include, developing financial plans for the next phases of the Mayors Vision, monitoring and reporting the organizations performance against the plan including cash flow and financial stability, managing enterprise risk management for the organization ensuring risk mitigation plans are updated and risk is monitored appropriately, and managing investor relations to ensure TransLink is positioned well to obtain the financing required. With the completion of the Compass Project we are now in full operational mode and will be focused on maximizing the benefits and outcomes on the program. The compass operations team will be exploring future functionality for the Compass Card and delivering programs to enhance the customer experience.


CORPORATE OPERATIONS BY CATEGORY



Administration 12,137 15,864 17,196 1,332 8.4%

Contracted Services 5,934 12,500 13,028 528 4.2%

Insurance 1,674 234 151 (83) (35.5%)

Maintenance, Materials and Utilities 3,228 3,058 3,022 (36) (1.2%)

Professional and Legal 8,987 13,304 15,935 2,631 19.8%

Rentals, Leases and Property Tax 9,041 8,032 10,569 2,537 31.6%



Change

Page 30

Corporate operating costs are expected to increase $9.3 million (10.2 per cent) over 2016 forecast primarily related to achieving enterprise priorities and supporting expansion including:

developing an asset management program and supporting 2014 Independent Review of SkyTrain recommendations to ensure a state of good repair;

additional resources to support management and delivery of the Public Transportation Infrastructure Funding projects;

studies relating to Transportation Demand Management to mobilize the Mayors’ Vision;

Compass system improvements and maintenance to improve customer experience; and

contractual and inflationary increases.

Increases in staffing levels and investments to support TransLink’s extensive capital program are critical to delivering the projects and services to the region.

Continuing to invest in the Compass system, including website enhancements, is a priority as we listen to our customers and strive to improve their experience.

Rental expenses have increased in Corporate Operations mainly due to reallocated property taxes on closed transit centres. In addition, labour and contractual increases and additional computer system licensing costs contribute to increased costs.

Page 31

Roads and Bridges

Total expenditures for Roads and Bridges in 2017 are expected to be $28.3 million (37.9 per cent) higher than 2016 forecast. The Major Road Network (MRN) program accounts for most of the increase in 2017 with $28.6 million higher contributions of which $22.5 million in funding has been added as part of Phase 1 of the 10 Year Vision: MRN Minor Capital Upgrades ($10.0 million); MRN Structure Rehabilitation and seismic upgrades ($6.5 million) and cycling infrastructure ($6.0 million). Roads and Bridges 2017 initiatives also include:

a multi-jurisdictional permitting study to develop an understanding of best practices and increase efficiency of both public and private organizations in supporting the region’s goods movement study,

public use policy and operating procedures for the BC Parkway,

Pattullo Bridge replacement consultation and design, and

contribution towards the establishment of a unified tolling back office for Metro Vancouver.

Amortization

Amortization is budgeted to be $24.3 million (13.1 per cent) higher than the 2016 forecast as a result of completing the Evergreen Extension and Hamilton Transit Centre projects in 2016; and conventional bus, HandyDART and community shuttle replacements, the rail fleet expansion, and the Commercial-Broadway station upgrade project being completed in 2017.

Interest

Interest expense is budgeted to rise $5.9 million (3.5 per cent) from the 2016 forecast, mainly due an equivalent reduction in interest capitalized during construction as a result of the Evergreen Extension going into service at the end of 2016.

Corporate – One-time

One-time costs in the 2017 budget are $19.3 million, consisting of rapid transit studies related to the Millennium Line Broadway Extension and South of Fraser Rapid Transit Projects ($2.0 million), software system replacements ($1.7 million), Trip Diary Planning ($1.5 million), other one-time projects ($1.2 million) including a comprehensive fare review, mobility pricing ($0.9 million), and a contingency provision per TransLink’s policy ($11.9 million).

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6. Investment in Capital Assets

Overview TransLink’s current priorities are to maintain existing service levels and ensure assets are in a state of good repair, mobilize the Mayors’ Vision and improve customer experience and public support. TransLink’s capital program ensures assets provide the most efficient and effective infrastructure required to serve its customers and stakeholders and delivers on the first phase of the Mayors’ Vision. Capital projects have been planned through an integrated enterprise system that measures impact on strategy, customer experience, stakeholder value, business effectiveness and other factors.

Summary of Capital, by Program 2017 Capital Cash Flow Total Project Budget

($ thousands)

Gross

Cost

Less:

Funding *

Net

Cost

Gross

Cost

Less:

Funding *

Net

Cost

2017 New Capital Program

Equipment 23,866 (14,411) 9,455 67,005 (36,479) 30,526

Facilities 6,727 (3,919) 2,809 10,257 (3,260) 6,997

Infrastructure 183,899 (141,467) 42,433 366,967 (277,311) 89,656

Technology 14,744 (1,132) 13,612 31,647 (0) 31,647

Vehicles - Revenue 115,297 (96,032) 19,265 418,792 (361,450) 57,342

Vehicles - Non Revenue 601 0 601 601 0 601

Major Construction 0 0 0 0 0 0

Subtotal 345,134 (256,960) 88,174 895,268 (678,499) 216,770

Equipment 13,301 (1,567) 11,734 32,216 (4,500) 27,716

Facilities 3,788 0 3,788 16,870 (6,069) 10,801

Infrastructure 120,819 (14,342) 106,477 311,004 (99,882) 211,122

Technology 4,746 0 4,746 24,820 0 24,820


Vehicles - Non Revenue 917 0 917 1,937 0 1,937

Major Construction 6,083 0 6,083 415,465 0 415,465

Subtotal 345,550 (193,904) 151,646 1,111,856 (382,565) 729,291

Total Capital

Equipment 37,167 (15,978) 21,189 99,221 (40,979) 58,242

Facilities 10,515 (3,919) 6,597 27,127 (9,329) 17,798

Infrastructure 304,718 (155,809) 148,910 677,971 (377,193) 300,778

Technology 19,490 (1,132) 18,357 56,467 (0) 56,467


Vehicles - Non Revenue 1,518 0 1,518 2,538 0 2,538

Major Construction 6,083 0 6,083 415,465 0 415,465

Capital Program Total 690,684 (450,864) 239,820 2,007,124 (1,061,064) 946,060

Capital Infrastructure Contributions

2017 New Program 38,333 0 38,333 45,882 0 45,882

Active and Approved in Principle 13,776 0 13,776 213,732 0 213,732

Total Capital Infrastructure Contributions 52,109 0 52,109 259,614 0 259,614

ALL PROJECTS 742,792 (450,864) 291,928 2,266,738 (1,061,064) 1,205,674

Active/Approved in Principle (AIP) Capital

* The funding so urces inc lude Federal Gas Tax, B uild C anada Fund, P ublic T rans it Infras truc ture P ro gram , C ity o f Vanco uver, B C H ydro

Page 33

The table above highlights capital projects grouped into asset categories and includes capital infrastructure contributions for which TransLink is authorized and mandated to address regional Major Road Network (MRN) needs. The budget for the 2017 new capital program is $895.3 million. The projected 2017 cash flow for all projects is $742.8 million, which is made up of $345.1 million for the 2017 New Capital Program, $345.6 million for existing capital programs and $52.1 million for Capital Infrastructure Contributions. The net cash impact to 2017 after senior government funding is $291.9 million.

2017 New Capital Program

The 2017 New Capital Program projects advance the first phase of the Mayors’ Vision and maintain existing services and keeps the system in a state of good repair. TransLink’s 2017 capital budget is $895.3 million. Capital Projects supported by the Public Transit Infrastructure Fund total $638.0 million which include rail fleet expansion, upgrades to stations and exchanges and further work to advance expansion of the rapid transit network. Expansion of the bus network of $88.8 million is funded by the Greater Vancouver Regional Fund (Gas Tax). Other expansion projects include $22.5 million for transit priority improvements for new B-Line corridors. The remaining projects are for state of good repair. Anticipated senior government contributions total $678.5 million. The net capital spending for this program is forecast to be $216.8 million. The following table provides summary information on projects with a project budget greater than $2 million for each category. Table1:2017 New Capital Program ($ thousands)

2017 New Capital Program Project Details

Classification and Project Name Description Gross Cost

Less

Funding

TransLink

Net Cost Gross Cost

Less

Funding

TransLink

Net Cost

EQUIPMENT

Decoupling of Important Systems Improving systems for the rail network, per

McNeil recommendations

6,800 (5,644) 1,156 6,800 (5,644) 1,156

ML Fire Life Safety System Replace the major components and subsystems

of the Fire Life Safety System (FLSS) along the

Millennium Line rail network

142 - 142 7,672 - 7,672

SkyTrain Physical Security System

Project

Assess and upgrade security access systems for

SkyTrain facil ities

1,622 - 1,622 7,900 - 7,900

TMAC Radio Replacement Upgrade TMAC Mobile Automated Vehicle

Location (AVL) radio system

9,013 (7,480) 1,532 35,600 (29,548) 6,052

Other Six (6) other projects in this asset category 6,289 (1,287) 5,003 9,033 (1,287) 7,746

FACILITIES

Other Fifteen (15) other projects in this asset category6,727 (3,919) 2,809 10,257 (3,259) 6,998

INFRASTRUCTURE

SkyTrain OMC Upgrades Replace/relocate SkyTrain Control Rooms 25,000 (20,750) 4,250 50,000 (41,500) 8,500

BC Hydro Upgrades BC hydro upgrade early works for the Millennium

line Broadway extension 17,000 (14,110) 2,890 17,000 (14,110) 2,890

Bear Creek Replacement Bridge upgrade as part of early works for the

South of Fraser transit improvements 5,170 (4,291) 879 6,070 (5,038) 1,032

Canada Line Station Upgrades Upgrades to stations on the Canada Line rail

network 7,500 (6,225) 1,275 15,000 (12,450) 2,550

Edmonds OMC Capacity Upgrades Improvements to the SkyTrain Operations and

Maintenance Centre (OMC) at Edmunds 4,500 (3,735) 765 9,000 (7,470) 1,530

Expo Line Station Escalators - Stage 4 New replacement program of all the escalators

across the Expo Line rail network 10,250 (8,508) 1,743 27,431 (22,768) 4,663

2017 Capital Cash Flow Total Project Budget

Page 34

Table 1: 2017 New Capital Program ($ thousands) Cont.



Less

Funding

TransLink

Net Cost Gross Cost

Less

Funding

TransLink

Net Cost

Expo Line Upgrade Strategy - Burrard

station: Design & Implementation

Design and upgrade Burrard Station for capacity

and passenger flow 4,700 (3,901) 799 60,700 (50,381) 10,319

Guideway Intrusion System Upgrade Improving guideway safety for the rail network,

per McNeil recommendations. 9,800 (8,134) 1,666 9,800 (8,134) 1,666

Guildford Exchange Guidford Exchange upgrades as part of early

works for the South of Fraser transit

improvements5,168 (4,289) 879 5,168 (4,289) 879

Investments in transit priority on

priority B-Line corridors

Improvements to the transportation corridors for

new B-Line routes 5,594 - 5,594 5,594 - 5,594

Joyce Station Upgrades - Phase II Upgrade Joyce Collingwood Station to improve

accessibil ity 3,707 (3,077) 630 13,089 (10,864) 2,225

Lonsdale Quay bus loop and SeaBus

terminal upgrade

Design and implementation of improvements to

passenger environment in bus loop and North

SeaBus Terminus- - - 8,000 (6,640) 1,360

MetroTown Bus Loop Refurbishment Refurbish Metrotown Bus Loop2,500 (2,075) 425 5,000 (4,150) 850

MLBE Procurement Readiness Procurement preparation for the Millennium Line

Broadway Extension project 22,987 (19,079) 3,908 23,000 (19,090) 3,910

Newton Exchange Upgrade Newton Exchange6,009 (4,987) 1,021 12,017 (9,974) 2,043

Pedestrian Improvements: Walking

Access to Transit

Improvements to pedestrian access around

transit stations and exchanges 2,500 - 2,500 2,500 - 2,500

Phibbs Exchange Upgrade Upgrade Phibbs bus exchange for safety and

customer and vehicle capacity 3,230 (2,681) 549 23,190 (19,248) 3,942

Road Widening Roadway upgrades as part of early works for the

South of Fraser transit improvements 4,000 (3,320) 680 9,000 (7,470) 1,530

Roofing Replacements (#1&2) Roof replacements of facil ities along the Expo

Line rail network 245 (204) 42 5,980 - 5,980

Running Rail Replacement Replace running rail that have reached the end of

service l ife 1,716 (1,425) 292 7,128 - 7,128

South of Fraser Rapid Transit Project

Procurement Readiness

Procurement preparation for the South of Fraser

Rapid Transit Project 19,988 (16,590) 3,398 20,000 (16,600) 3,400

System Continuity Redundancies,

Second BC Hydro Feed

Improving power supply continuity for the rail

network, per McNeil recommendations 1,550 (1,287) 264 3,100 (2,573) 527

Translink owned investment in cycling

infrastructure

Rehabilitate the BC Parkway to further integrate

and improve cycling facil ities 2,300 - 2,300 2,300 - 2,300

Two Bus Exchange Upgrades Improve bus exchanges as part of region-wide

transit facil ity upgrades 5,000 (4,150) 850 10,000 (8,300) 1,700

Wayfinding System Integration -

Missing Signage

Install missing wayfinding signage on Expo and

Millenium Lines 1,621 (1,345) 276 3,240 - 3,240

Other Thirteen (13) other projects in this asset category11,864 (7,304) 4,560 13,660 (6,261) 7,399

TECHNOLOGY

BCRTC Enterprise Asset Management

Implementation

Implement an Enterprise Asset Management

(EAM) system to enable the effective control of

SkyTrain system and maintenance processes.1,364 (1,132) 232 11,760 (0) 11,760


Page 35

Table 1: 2017 New Capital Program ($ thousands) Cont.

Active and Approval in Principle (AIP) Projects Underway

Capital projects already approved and underway have a total budget of $1.1 billion. Anticipated senior government contributions total $382.6 million, leaving the net cost forecast to be $729.3 million. Spending in 2017 on these projects is forecast at $345.6 million with senior government funding of $193.9 million for net spending of $151.6 million. The bulk of this spending is for bus vehicle replacement forecasted to be $187.2 million for 2017 and upgrades on four SkyTrain stations, forecasted at $73.4 million. The table below highlights specific projects with 2017 project cash flows greater than $1 million in 2017.



Less

Funding

TransLink

Net Cost Gross Cost

Less

Funding

TransLink

Net Cost

TECHNOLOGY

Compass System Advancements Ensure the performance, functionality and

capacity of the Compass systems will meet those

business and customer requirements that are

identified to materially impact operational

efficiency or customer satisfaction

4,676 - 4,676 9,500 - 9,500

IT Infrastructure Program 2017 Ongoing computer systems and infrastructure

lease renewals and replacement 4,050 - 4,050 5,235 - 5,235

Other Eleven (11) other projects in this asset category4,654 - 4,654 5,152 - 5,152

VEHICLES - REVENUE

2018 Community Shuttle Vehicle

Replacement (30)

Replacement of Twenty (20) Community Shuttle

buses - - - 3,700 (3,500) 200

2018 Conventional Bus Replacement

(92-40D)

Replacement of ninety two (92) -40 foot buses

that have reached the end of their useful service

l ives.- - - 65,320 (60,800) 4,520

2018 HandyDart vehicle Replacement

(46)

Replacement of forty (40) HandyDART vehicles

that have reached the end of their useful service

l ives- - - 6,000 (5,605) 395

Bus-Vehicles Conventional 40 Procure new Conventional 40 foot buses- - - 66,740 (60,066) 6,674

Bus-Vehicles Conventional 60 Procure new Conventional 60 foot buses- - - 11,440 (10,296) 1,144

Canada Line Fleet Expansion Procure train cars for expanding service on the

Canada Line rail network 44,000 (36,520) 7,480 88,000 (73,040) 14,960

Community Shuttle Vehicles Procure new Community Shuttles- - - 3,000 (2,700) 300

Equipment for Deferred Retirement

Program

Additional equipment to keep retiring buses in

service until expansion vehicles arrive 4,797 (4,317) 480 4,797 (4,317) 480

Expo Fleet Expansion (20 cars) Procure 20 new MKIII train cars for expanding

service on the Expo Line rail network 40,000 (33,200) 6,800 80,000 (66,400) 13,600

Fleet Expansion (SeaBus boat) Procure a new SeaBus- - - 34,000 (28,220) 5,780

Handy DART Vehicles Procure new HandyDART buses- - - 2,795 (2,516) 279

Millennium Fleet Expansion (8 cars) Procure 8 new MKIII train cars for expanding

service on the Millennium Line rail network 16,000 (13,280) 2,720 32,000 (26,560) 5,440

WCE Fleet Expansion Procure train cars for expanding service on the

West Coast Express (WCE) rail network 10,500 (8,715) 1,785 21,000 (17,430) 3,570

Other Two (2) other projects in this asset category- - - - - -

VEHICLES - NON REVENUE

Other Two (2) other projects in this asset category601 - 601 601 - 601

Grand Total 345,134 (256,960) 88,174 895,268 (678,498) 216,770


Page 36

Table 2: Active and Approved in Principle (AIP) Projects Underway ($ thousands)

Active and Approved in Principle (AIP) Capital Program Details

Classification and Project Name Description

Gross

Cost

Less

Funding

TransLink

Net Cost

Gross

Cost

Less

Funding

TransLink

Net Cost

EQUIPMENT

Expo Line SCADA RTU Replacement Replace sixteen (16) Supervisory Control and Data

Acquisition (SCADA) Remote Terminal Units (RTU) at

the Expo Line Propulsion Power Substations (PPS)

including supply and installation of associated

marshalling panels, cables/wires and communications

equipment

1,114 - 1,114 3,400 - 3,400

ATC Existing Equipment Replacement -

Phase 2

Replace ATC equipment to improve system reliability

and maintain state of good repair

2,006 (1,567) 439 5,100 (4,500) 600

Replace Rail Rotary Grinder 1 (incl Dust

Collection System)

Replace Rotary Grinder 1 that has reached end of

service life

3,063 - 3,063 3,750 - 3,750

ATC Existing Equipment Replacement on

Expo Line

Replace ATC equipment to improve system reliability

and maintain state of good repair

5,497 - 5,497 12,400 - 12,400

Other Four (4) other projects in this asset category 1,622 - 1,622 7,566 - 7,566

FACILITIES

Brentwood Station South Elevator

Facility

Design and construct a new elevator, canopy and

stairwell facility on the south side of the Brentwood

Millennium Line SkyTrain Station

2,355 - 2,355 3,655 - 3,655

Other Six (6) other projects in this asset category 1,433 - 1,433 13,215 (6,069) 7,146

INFRASTRUCTURE

Running Rail Replacement Replace running rail that have reached the end of

service life

3,313 - 3,313 392 - 392

Metrotown Station and Exchange

Upgrade Design

Upgrade Metrotown SkyTrain station and construct

new bus exchange

29,082 (3,573) 25,509 68,774 (34,800) 33,974

Commercial Broadway SkyTrain Station

Phase 2 Upgrade Design

Design and construction of Phase 2 Commercial

Broadway SkyTrain station development to increase

capacity

20,521 - 20,521 73,095 (28,217) 44,878

SeaBus Terminals and Admin Building

Envelope Upgrades-Design Stage

Upgrade SeaBus Terminals and Admin Building

Envelope

5,179 - 5,179 12,443 - 12,443

Seismic Upgrade South Seabus and

Skywalk - Construction

Upgrade of the South SeaBus Terminal structures to

withstand a 1 in 475 year earthquake event

3,862 - 3,862 6,000 - 6,000

Surrey Central Station Upgrades Design Upgrade SkyTrain station facilities to increase capacity 11,513 (4,864) 6,649 17,550 (9,000) 8,550

Joyce-Collingwood Station Upgrade

Design

Upgrade Joyce Collingwood Station to improve

accessibility

12,241 (4,097) 8,144 25,978 (17,465) 8,513

Pattullo Bridge Rehabilitation Phase 2

Design

Design for structural seismic upgrade work on the

Pattullo Bridge

3,333 - 3,333 32,711 - 32,711

STC CNG Facility Retrofit AIP - Retrofit the Surrey Transit Centre to

accommodate CNG bus fuelling and maintenance

requirements

8,038 - 8,038 15,000 (4,000) 11,000

TOH Metrotown Group Rectifier

Replacement

AIP - Design and construct rectifier station

replacements at Central Park, Willingdon East and

Willingdon West rectifier stations

1,868 (1,606) 262 5,765 (4,725) 1,040

Replace Platform LEDs System AIP - Replace the existing red PLED panels at the Expo

and Millennium Line stations

1,544 - 1,544 9,559 - 9,559

29th Avenue Bus Exchange Layover

Improvements

New curb alignment of bus pick-up and drop-off bays

and island to accommodate additional layover bays

and passenger waiting/circulation space

1,360 - 1,360 1,815 - 1,815


Page 37

Table 2: Active and Approved in Principle (AIP) Projects Underway ($ thousands) Cont.

Active and Approved in Principle (AIP) Capital Program Details


Gross

Cost

Less

Funding

TransLink

Net Cost Gross Cost

Less

Funding

TransLink

Net Cost

INFRASTRUCTURE

Expo and Millennium Line Signage and

Station Fixture Replacement

Upgrade signage at 25 Expo and Millennium Line stations

to support system operational changes, ensure code and

regulatory signage compliance, and bring all stations up to

TransLink Wayfinding Standard. This project is part of a

multi-year program and is divided into three tiers of

priority.

5,348 - 5,348 6,510 - 6,510

Fibre Optic System Upgrade Stage 3 Extend geographic reach of new BCRTC and TransLink fibre

optic cables to Millennium Line stations from Lougheed

Station to VCC-Clark Station, provides fibre capacity to ATC

Equipment Replacement project and includes fibre capacity

for the future UBC SkyTrain Line

2,586 - 2,586 4,290 - 4,290

Rail Clamping Retrofit Replace Expo and Millenium Line rail pads 1,859 - 1,859 4,800 - 4,800

Pattullo Bridge Replacement Design and construct new Pattullo Bridge 5,527 - 5,527 5,527 - 5,527

Other Thirteen (13) other projects in this asset category 3,646 (203) 3,443 20,795 (1,675) 19,120

TECHNOLOGY

IT Equipment Replacement (370) Replacement of IT infrastructure equipment 1,162 - 1,162 7,015 - 7,015

SkyTrain Public Announcement System Replacement of Integrated Alarm Notification System at all

Expo Line passenger stations, Expo Line propulsion power

stations and the SkyTrain Operations and Maintenance

Centre

1,035 - 1,035 6,375 - 6,375

Other Fourteen (14) other projects in this asset category 2,548 - 2,548 11,430 - 11,430

VEHICLES - REVENUE

100-400 Series MK I Refurbishment Project Refurbish the original 114 MKI SkyTrain cars to extend

service lives by another 15 years

8,653 (6,987) 1,666 37,294 (24,360) 12,934

2015 Conventional Replacement Buses Procure new replacement 40’ and 60’ articulated buses to

replace 1997 conventional buses that have reached the

end of their useful service life

23,005 (22,075) 930 59,000 (54,800) 4,200

2016 Conventional Bus Replacement This project is to replace 111 conventional 40ft and 60ft

buses that reached end of useful service lives with 25-40ft

CNG, 60-40ft diesel and 26-60ft diesel buses

61,574 (52,220) 9,354 89,100 (78,824) 10,276

2016 Community Shuttle Replacements This project is to replace 20 Community Shuttles that

reached the end of their useful service lives with 20 new

Community Shuttles through exercising an option on the

existing shuttle contract

8,895 (8,649) 246 4,200 (4,200) -

2017 Conventional Bus Replacement (54-

40G and 52-60H)

Replace 52 articulated buses and 54 standard buses

reaching end of useful service life in fall 2017

85,368 (81,099) 4,269 92,700 (86,700) 6,000

2017 HandyDART Vehicle Replacement (35) Replace 35 HandyDART buses expected to reach end of

useful lives by 2017

4,163 (3,746) 417 5,600 (5,010) 590

2017 Community Shuttle Vehicle

Replacement (20)

Replace 20 Community Shuttles that reached end of useful

service life in fall 2017

3,766 (3,220) 546 4,100 (3,500) 600

Other Two (2) other projects in this asset category 474 - 474 17,550 (14,720) 2,830

VEHICLES - NON REVENUE

Other Two (2) other projects in this asset category 917 - 917 1,937 - 1,937

MAJOR CONSTRUCTION

Evergreen Extension Integration to Meet

Current Standards

Project scope is to address safety/reliability issues,

systems deficiencies, and current standards for bicycle

infrastructure.

3,465 - 3,465 12,624 - 12,624

Evergreen Extension - TransLink

Contribution

TransLink monetary and in kind contributions to the design

and construction of the Evergreen Line by the Province.

2,618 - 2,618 402,841 - 402,841

Grand Total 345,550 (193,904) 151,645 1,111,856 (382,565) 729,291


Page 38

Capital Infrastructure Contributions

TransLink provides capital infrastructure contributions each year to the municipalities to fund rehabilitation and minor capital work on the Major Road Network (MRN) and bike pathways. TransLink is increasing spending in 2017 for MRN upgrades and structure along with additional spending for expanding the regional bike network. For 2017, TransLink is budgeting capital contribution funding of $45.9 million to municipalities for road and bike infrastructure. Projects already approved and underway have a budget of $213.7 million, which with the 2017 capital infrastructure contributions, total $259.6 million. None of these projects are eligible for senior government funding. The table below provides information on projects with over $1 million in cash flow in 2017. Table 3: Capital Infrastructure Contribution Projects Planned for 2017 ($ thousands)

Table 4: Capital Infrastructure Contribution Projects Currently Underway ($ thousands)

2017 New Capital Infrastructure Contribution Details


TransLink

Net Cost

TransLink

Net Cost

INFRASTRUCTURE

Expanding and upgrading the network of

municipal designated cycling routes

Funding for the expansion of the cycling network in the region 6,000 6,000

MRN Program Funding: MRNB Capital

Program/Upgrades

Additional contribution to member municipalities for upgrades to

the road network

10,000 10,000

MRN Structures - Seismic Rehab Additional contribution to member municipalities for seismic road

network rehabilitation

6,500 6,500

MRNB Capital Program - 2017 Annual contribution program to member municipalities for

pavement rehabilitation, and road and bike infrastructure upgrades

15,833 23,382

Grand Total 38,333 45,882

2017

Capital Cash

Total

Project

Active and Approved in Principle (AIP) Capital Infrastructure Contribution Details


TransLink

Net Cost

TransLink

Net Cost

INFRASTRUCTURE

2010 MRN Minor Capital Program - First &

Second Wave Program

2010 contribution program to member municipalities for improving

the capacity, safety and connectivity of the Major Road Network

1,776 18,227

2011 MRN Minor Capital Program 2011 contribution program to member municipalities for improving


1,975 9,255

2012 MRN Minor Capital Program 2012 contribution program to member municipalities for improving


2,060 17,443

2014 Major Road Network and Bike Capital

Program

2014 contribution program to member municipalities for pavement

rehabilitation , and road and bike infrastructure upgrades

1,553 23,503


Program

2015 contribution program to member municipalities for pavement

rehabilitation , and road and bike infrastructure upgrades

1,049 24,214


Program

Annual contribution program to member municipalities for

pavement rehabilitation, and road and bike infrastructure upgrades

2,896 23,784

Roberts Bank Rail Corridor Program Contribution program to member municipalities for road

infrastructure upgrades at Roberts Bank Rail Corridor

1,714 45,800

Other Six (6) other projects in this category 754 51,506

Grand Total 13,776 213,732

2017

Capital Cash

Total

Project

Page 39

7. Changes in Financial Position

Financial Assets The restricted cash and investments primarily represent unspent government transfers and self-administered sinking funds.

Liabilities Deferred government transfer represents the receipt of capital funding offset by the amortization and revenue recognition for government funding. The Golden Ears Bridge contractor liability decreased slightly as principal payments commenced during 2015 and will continue in future years. Deferred concessionaire credits represent the funding provided by the Canada Line Concessionaire. This balance is amortized to income on a straight-line basis over the operating term of the concessionaire agreement, which will expire in July 2040. The increase in employee future benefits, which represent post-retirement and post-employment benefits, is due to the annual estimated current service cost and related interest. The post-retirement portion of this liability will draw down upon retirement of the employees.

Consolidated Statement of Financial Position

As at December 31 2016 2017

($ thousands) Q2 FORECAST BUDGET Change

Cash and Investments 231,600 266,564 34,964

Accounts Receivable 105,494 108,659 3,165

Restricted cash and investments 543,715 669,530 125,815

Debt reserve deposits 34,966 32,838 (2,128)

Financial Assets 915,775 1,077,591 161,816

Accounts payable and accrued liabilities 264,202 269,486 5,284

Debt 2,338,732 2,555,502 216,770

Deferred government transfers 1,051,706 1,067,868 16,162

Golden Ears Bridge contractor l iability 1,048,903 1,045,439 (3,464)

Deferred concessionaire credits 548,995 525,658 (23,337)

Employee future benefits 122,499 134,222 11,723

Deferred revenue and deposits - - -

Deferred lease inducements 12,499 12,259 (240)

Liabilities 5,387,536 5,610,434 222,898

Net Debt (4,471,761) (4,532,843) (61,082)

Tangible Capital Assets 4,906,331 5,273,583 367,252

Supplies Inventory 58,135 59,879 1,744

Prepaid Expenses 12,070 12,433 363

Non-Financial Assets 4,976,536 5,345,895 369,359

Accumulated Surplus 504,775 813,052 308,277

Page 40

Non-Financial Assets Planned capital spending during 2017 will result in a net increase of $367.2 million (7.5 per cent) in capital assets. Significant projects include conventional bus replacements, rail fleet expansion, station upgrades, rail infrastructure projects, and procurement readiness work for the Millennium Line Broadway Extension and the South of Fraser Light Rapid Transit (LRT) rapid transit projects.

Page 41

8. Liquidity and Capital Resources

Cash Flows and Liquidity

Cash and cash equivalents are expected to increase by $35 million due to net operating, investing, financing and funding activity. Liquidity is further supported by TransLink’s Commercial Paper program which is budgeted to stay at $240.0 million by the end of 2017. The following table shows TransLink’s unrestricted cash and investments net of those investments maturing in 12 months or longer.

Restricted Funds

The Unspent Government Transfers are used to fund qualifying capital expenditures.

UNRESTRICTED CASH AND INVESTMENTS



Cash and cash equivalents 231,600 266,564 34,964

Total Unrestricted cash and investments 231,600 266,564 34,964

RESTRICTED CASH AND INVESTMENTS



Unspent government transfers 322,940 264,592 (58,348)

TPCC's investments 22,630 22,630 -

Restricted proceeds of real estate sales 39,284 179,284 140,000

Self administered sinking funds 158,861 203,024 44,163

Total Restricted cash and investments 543,715 669,530 125,815

Page 42

Net Debt

TransLink currently has three main sources of financing its assets: Net Direct Debt, Indirect P3 Debt and Senior Government Contributions. The latter is represented on the balance sheet as Deferred Government Transfer. Net Direct Debt is expected to increase by $174.7 million due to the budgeted $300.0 million (at 3.5 per cent) issuance of new debt in 2017 partially offset by sinking fund contributions. The issuance of new debt in 2017 is to help finance our budgeted capital spending net of senior government contributions. Although the Net direct debt and indirect P3 debt have increased by $147.9 million and remain high, this level is reflective of the high capital intensive nature of the organization and rapid growth to meet the transportation needs of region. This net debt level is well within our debt to revenue policy limit of 300 per cent at 256.8 per cent for the 2017 budget.

FINANCING

As at December 31 2016 2017($ thousands) Q2 FORECAST BUDGET Change

Debt 2,338,732 2,555,502 216,770 Less: Self-administered sinking funds (158,861) (203,024) (44,163)

Less: Debt reserve deposits (34,966) (32,838) 2,128

Net Direct Debt 2,144,905 2,319,640 174,735

Golden Ears Bridge contractor l iability 1,048,903 1,045,439 (3,464) Deferred concessionaire credits 548,995 525,658 (23,337)

Indirect P3 Debt 1,597,898 1,571,097 (26,801)

Subtotal Net Direct Debt and Indirect P3 Debt 3,742,803 3,890,737 147,934

Deferred government transfers 1,051,706 1,067,868 16,162

Accounts payable and accrued liabilities 264,202 269,486 5,284

Employee future benefits 122,499 134,222 11,723

Deferred lease inducements 12,499 12,259 (240)

Less: Accounts receivable (105,494) (108,659) (3,165)

Other Financing 293,706 307,308 13,602

Total Financing 5,088,215 5,265,913 177,698

Less: Other restricted cash and investments (384,854) (466,506) (81,652)

Less: Unrestricted cash and investments (231,600) (266,564) (34,964)

PSAB Net Debt 4,471,761 4,532,843 61,082

Page 43

Appendix I – Consolidated Financial Statements The following statements are presented in accordance with generally accepted Canadian accounting principles for local governments, as recommended by the Public Sector Accounting Board of the Chartered Professional Accountants of Canada.



as at December 31 2015 2016 2017

($ thousands) ACTUAL BUDGET BUDGET

Cash 1

249,527 121,397 266,564

Accounts Receivable 102,421 101,708 108,659

Restricted cash and investments 439,770 407,310 669,530

Investments 83,573 83,661 -

Debt reserve depos its 36,407 34,639 32,838

Financia l Assets 911,698 748,715 1,077,591

Accounts payable and accrued l iabi l i ties 241,766 196,533 269,486

Debt 2,144,102 2,285,560 2,555,502

Deferred government transfer 1,124,066 1,110,026 1,067,868

Golden Ears Bridge contractor l iabi l i ty 1,050,913 1,049,021 1,045,439

Deferred concenss ionaire credits 572,396 548,995 525,658

Employee future benefi ts 110,023 119,233 134,222

Deferred Revenue and Depos its 14,742 - -

Deferred lease inducements - net 12,799 12,499 12,259

Liabi l i ties 5,270,807 5,321,867 5,610,434

Net Debt (4,359,109) (4,573,152) (4,532,843)

Tangible Capita l Assets 4,606,623 4,864,333 5,273,583

Suppl ies Inventory 56,442 55,683 59,879

Prepaid Expenses 11,719 11,209 12,433

Non-Financia l Assets 4,674,784 4,931,225 5,345,895


1 2017 figure has been reclassified to include Investments

Page 44

Consolidated Statement of Operations




Revenue

Taxation 772,722 784,532 833,028

Trans i t 511,445 508,272 558,910

Golden Ears Bridge tol l ing 48,444 50,641 55,744

Government Transfers 228,943 282,185 281,904

Amortization of Deferred Concess ionaire Credit 23,273 23,337 23,337

Investment Income 34,381 36,172 37,712

Miscel laneous 6,102 3,537 5,464

Gain (Loss ) on Disposal 2,340 - 149,677

1,627,650 1,688,676 1,945,776

Expenses

Bus Divis ion 643,484 656,865 691,289

Corporate 103,675 130,299 120,448

Ra i l Divis ion 268,311 263,091 300,010

Roads & Bridges 80,490 82,782 103,244

Trans i t Pol ice 33,136 33,847 36,921

Sub-total Expenses , before Amortization and Interest 1,129,096 1,166,884 1,251,912

Amortization of Capita l Assets 168,290 181,520 209,286

Interest 167,902 168,203 176,301

1,465,288 1,516,607 1,637,499

Surplus for the year 162,362 172,069 308,277

Accumulated surplus , beginning of year 153,313 186,004 504,775

Accumulated surplus , end of year 315,675 358,073 813,052

Page 45

Consolidated Statement of Changes in Net Debt




Surplus for the year 162,362 172,069 308,277

Acquis i tion of tangible capita l assets (267,619) (435,321) (578,144)

Amortization of capita l assets 168,290 181,520 209,286

Gain on disposal of tangible capita l assets (2,340) - (149,677)

Net proceeds from disposal of capita l assets 2,642 - 151,283

Tangible capita l assets contributed to municipa l i ties 3,784 - -

Writedown of tangible capita l asset 612 - -

(94,631) (253,801) (367,252)

Increase in suppl ies inventory (5,176) (1,622) (1,744)

Decrease in prepaid expense 797 997 (363)

(4,379) (625) (2,107)

Decrease in net debt 63,352 (82,357) (61,082)

Net debt, beginning of year (4,422,461) (4,490,795) (4,471,761)

Net debt, end of year (4,359,109) (4,573,152) (4,532,843)

Page 46

Consolidated Statement of Cash Flows




Surplus (Defici t) for the period 162,362 172,069 308,277

Non-cash charges to operations (58,919) (106,668) (159,773)

Net proceeds from disposal of assets held for sa le 4,868 - -

Changes in non-cash operating working capita l 28,054 7,215 11,735

Net changes in cash from operating transactions 136,365 72,616 160,239

Purchase of capita l assets (267,619) (435,321) (578,144)

Net proceeds from disposal of capita l assets 2,642 - 151,283

Net changes in cash from capita l transactions (264,977) (435,321) (426,861)

Decrease (Increase) in restricted cash and investments (78,261) 32,432 (125,815)

Decrease (Increase) in investments 1,013 3,603 -

Decrease (Increase) in debt reserve depos its (303) 1,300 2,128

Net changes in cash from investment transactions (77,551) 37,335 (123,687)

Debt Proceeds 180,750 270,000 300,000

Is sue costs in financing 8,461 - -

Repayments of debt 1 (92,049) (88,587) (83,230)

Repayments of Golden Ears Bridge Contractor Liabi l i ty (462) - (70,097)

Lease inducements received - (430) (240)

Government transfers received for capita l additions 130,255 122,446 278,840

Net changes in cash from financing transactions 226,955 303,429 425,273

Increase (decrease) in cash 20,792 (21,941) 34,964

Cash, beginning of year 228,735 143,337 231,600

Cash, end of year 249,527 121,397 266,564

Page 47

Appendix II – Allocated Costs between Divisions

Allocated Cost Breakdown

Twelve months ending December 31 2015 2016 2017 Change


Shared ServicesBus Division 23,440 25,386 26,652 1,266 5.0%Access Transit 972 665 683 18 2.7%SkyTrain - Expo & Millenium Line 1,108 1,057 2,532 1,475 139.5%West Coast Express 70 68 83 15 22.1%Evergreen Line - 15 - (15) (100.0%)Transit Police 1,679 1,554 1,807 253 16.3%Roads & Bridges 11,446 12,985 9,428 (3,557) (27.4%)Corporate (38,715) (41,730) (41,185) (545) (1.3%)

Total Shared Services allocated - - - - -

Costs Administered by TransLink and allocated to subsidiariesBus Division 16,411 18,215 17,810 (405) (2.2%)SkyTrain - Expo & Millenium Line 4,770 4,536 5,154 618 13.6%SkyTrain - Canada Line 2,215 2,470 2,455 (15) (0.6%)West Coast Express 15,725 573 631 58 10.1%Transit Police 1,793 1,878 1,993 115 6.1%

Total Costs Administered by TransLink allocated 40,914 27,672 28,043 371 1.3%

Bus Division 39,851 43,601 44,462 861 2.0%Access Transit 972 665 683 18 2.7%SkyTrain - Expo & Millenium Line 5,878 5,593 7,686 2,093 37.4%SkyTrain - Canada Line 2,215 2,470 2,455 (15) (0.6%)West Coast Express 15,794 641 714 73 11.4%Evergreen Line - 15 - (15) (100.0%)Transit Police 3,472 3,432 3,800 368 10.7%

Total costs allocated to Subsidiaries from TransLink 68,182 56,417 59,800 3,383 6.0%



DATE: December 2, 2016 SUBJECT: Budgeted Contingency & Reserve Policy Update - Accumulated Funding Resources PROPOSED RESOLUTION: That the TransLink Board of Directors approve the proposed changes to the Budgeted Contingency and Reserve Policy as set out in Appendix 1 to the November 10, 2016 report titled “Budgeted Contingency and Reserve Policy Update – Accumulated Funding Resources.

PURPOSE The purpose of this report is to seek approval from the Board to the recommended changes to TransLink’s Budgeted Contingency and Reserve Policy.

BACKGROUND The Budgeted Contingency and Reserve Policy provides TransLink with the ability to manage adverse risks on revenues and expenses. Without a reasonable buffer, TransLink may not be able to absorb negative economic shocks without impacting service levels, which would have considerable reputational risk with our stakeholders and customers.

There are two parts to this policy.

1) Budgeted Contingency is a contingency included in the annual budget to handle pricing uncertainties and unforeseen initiatives or circumstances. The current policy has this at a minimum of 1% of budgeted operating expenditures. No changes to this contingency is being proposed at this time.

2) Funded Cumulative Reserves is related to Section 194(4) of the South Coast British Columbia Transportation Authority Act, which states as follows:

The investment plan must, for each applicable year, reflect planned expenditures for that year under subsection (3) (c) that are not, in total, greater than the total of:

(a) revenue and borrowing for that year referred to in subsection (3) (d) and (e), and (b) funding resources accumulated from previous years. The above legislation is essentially a determination of all the source and application of funds over the 10-year investment planning period and mentions that these can all be measured on a cash basis, as opposed to an accrual basis, and thus the resulting net position must therefore be TransLink’s cash balances.

Budgeted Contingency & Reserve Policy Update - Accumulated Funding Resources December 2, 2016 Page 2 of 3

Thus TransLink's governing legislation has a very important financial requirement that its 10-year Investment Plans must always be fully funded. There is not a requirement that each year, in isolation, must have a net positive funding result, but in any such year the funding resources accumulated from prior years (i.e. the AFR) must be sufficient to cover such a funding shortfall and thus ultimately at the beginning and end of the 10-year planning period there must be always be a resulting positive AFR. How positive a balance is then a matter of how much of a buffer is built into the plan to cover unforeseen circumstances. To date, TransLink has complied with this requirement to always have a positive AFR by taking the Statement of Operations and adjusting this for any major timing differences. However this method was very complicated and thus resulted in two sets of reported numbers which was then very confusing to stakeholders. At the September Audit Committee meeting, the committee endorsed Managements resolution to measure TransLink’s liquidity and solvency using ‘unrestricted cash and investment’ rather the more complex current method. DISCUSSION Through a more careful dissection of section 194 of the Act, Management confirms that to comply with this section is to ensure that there is always a positive unrestricted cash and investment balance. By excluding any externally restricted cash and investment balance, such as the unspent federal gas tax monies and any internally restricted cash and investment balances, such as TransLink’s self-administered sinking funds and the cash portion of TransLink’s Revolving Land Account, there is a more accurate reflection of AFR. It is also Management’s proposal that funds held for TransLink’s captive insurance company, Transportation Property & Casualty Company Inc. (TPCC) be excluded from the AFR. TPCC entity’s investments are segregated as it has separate asset requirements to maintain its captive status. By using the unrestricted cash and investments to measure the AFR, this measurement can be very easily verified as it ties in with TransLink’s Statement of Cash Flows. As discussed with the Audit Committee in September, for both 10-Year planning purposes and to maintain a current healthy liquidity and solvency position a minimum AFR level is desirable. The recommendation is to establish a minimum AFR based on a percentage of Total Expenses. As PSAB’s total expenditures are inflated by depreciation on our gross asset base and also includes municipal capital infrastructure contributions which are typically financed with debt, the denominator in the equation should rather be based on Total Ongoing Operating Expenditures plus Ongoing Debt Service Costs (interest and principal debt payments), which is essentially includes Operating Expenditures (excluding municipal capital infrastructure contributions), Interest Expense and Debt Principal Repayments. Management is proposing that for the first three years of any 10-Year Investment Plan this minimum level be set at 15 percent and 12 percent for the remaining seven years. In developing the minimum level of 15 percent for the first three years Management primarily considered how Moody’s measures liquidity under its rating methodology as this was considered to be a good measure of how much cash

Budgeted Contingency & Reserve Policy Update - Accumulated Funding Resources December 2, 2016 Page 3 of 3

coverage of TransLink’s daily operating expenses is prudent. In developing the 12 percent for the remaining seven years of any 10-Year Investment Plan a lower percentage of Total Ongoing Operating Expenditures plus Ongoing Debt Service Costs was considered sufficient as over the longer term there would be more time to react to negative economic shocks. According to the 2017 10-Year Investment Plan these are the projected ratios:

CONCLUSION Management recommends that the TransLink Board approves Management’s proposed changes to the attached policy in Appendix 1.

Accumulated Funding Resources (AFR)(in thousands of dollars)

Q2 Forecastfor the years 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Denominator - Total Operating Exp. plus DSC: 1,401,571 1,485,617 1,535,348 1,604,927 1,676,879 1,720,173 1,759,617 1,794,883 1,840,456 1,878,796 1,903,437

Numerator - Accumulated Funding Resources * 231,604 266,496 277,672 274,566 261,835 259,451 271,009 292,239 318,559 354,391 424,599

AFR as a percentage of Total Funded Exp. 16.5% 17.9% 18.1% 17.1% 15.6% 15.1% 15.4% 16.3% 17.3% 18.9% 22.3%

* Equals: Unrestricted Cash & Investments

APPENDIX 1 CONFIDENTIAL

South Coast British Columbia Transportation Authority

Budgeted Contingency and& Reserve PolicyAccumulated Funding Resources

Policy

December 7, 2011November 2316, 2016

TRANSLINK BUDGETED CONTINGENCY AND& RESERVE

POLICYACCUMULATED FUNDING RESOURCES POLICY

REVISION DATE: JUNE 18, 2012NOVEMBER 238, 2016

2

1. Policy Statement ........................................................................................................... 3

2. Application ................................................................................................................... 3

3. Purpose ........................................................................................................................ 3

4. Policy Objectives........................................................................................................... 3

5. Policy Descriptions ........................................................................................................ 3

6. Reporting ..................................................................................................................... 4

7. Adoption and Review of Policy ...................................................................................... 4

1. POLICY STATEMENT ............................................................................................................ 3

2. APPLICATION ...................................................................................................................... 3

3. PURPOSE ............................................................................................................................. 3

4. POLICY OBJECTIVES ............................................................................................................ 3

5. POLICY DESCRIPTIONS ........................................................................................................ 3

6. REPORTING ......................................................................................................................... 4

7. ADOPTION AND REVIEW OF POLICY .................................................................................. 4

TRANSLINK BUDGETED CONTINGENCY AND& RESERVE

POLICYACCUMULATED FUNDING RESOURCES POLICY


3

1. Policy Statement

The Budgeted Contingency and Accumulated Funding Resources Reserve Policy governs the use of Budgeted Contingencies and Funded Cumulative ReservesAccumulated Funding Resources by South Coast British Columbia Transportation Authority (“TransLink”).

This policy supports the TransLink Enterprise Vision, Mission and Values and in particular directly supports the Values of Integrity, Excellence, Sustainability and Accountability.

2. Application

The Budgeted Contingency and Accumulated Funding Resources Reserve Policy applies to all Annual Budgets, Quarterly Forecasts and 10‐Year Financial StrategicInvestment Plans developed by TransLink to ensure the control, administration and management of these financial plans.

3. Purpose

To establish prudent guidelines for the short, medium and long‐term financial planning processes required by TransLink's governing legislation.

4. Policy Objectives

This policy for contingency reserves will meet the following objectives:

provision of measurable key performance indicators to determine the financial health of the organization;

maintenance or improvement of TransLink's current AA (stable) credit ratings;

optimization of TransLink's capital structure and risk profile;

improvement of TransLink's financial flexibility and ability to weather negative economic shocks; and

improvement of the predictability and consistency of TransLink's rolling three year strategic plan.10-Year Investment Plans.

5. Policy Descriptions

Budgeted Contingency

A minimum Budgeted Contingency of 1% of budgeted operating expenditures1 will be included in the Annual Budget for each fiscal year to handle pricing uncertainties and unforeseen initiatives or circumstances.

Access to the Budgeted Contingency Reserve is subject to Executive approval and any application will require a supportive business case.

1

Total budgeted expenditures, before the contingency, less debt service costs, before the contingencyinterest expense, amortization of capital assets and municipal capital infrastructure contributions.

4

TRANSLINK BUDGETED CONTINGENCY AND

ACCUMULATED FUNDING RESOURCESRESERVE POLICY


Funded Cumulative ReservesAccumulated Funding Resources

TransLink is required by law to maintain a positive Funded Cumulative ReserveAccumulated Funding Resources position throughout any 10-year Investment Plan period.

, to be drawn only in the event of a budgeted shortfall. In the 3‐Year Plan, a minimum

Funded Cumulative Reserve of 12% of Total Funded Expenditures2 will be maintained over the strategic planning period. For the 7‐Year Outlook a lower minimum Funded Cumulative Reserve of 10% of will be maintained. TransLink’s Accumulated Funding Resources is equal to TransLink’s unrestricted cash and investments and can thus be verified in TransLink’s Consolidated Statement of Operations. For these purposes any investments held in the name of TransLink’s captive insurance company, Transportation Property & Casualty Company Inc. and any restricted cash and investments, such as the unspent government transfers and TransLink’s self-administered sinking funds and the cash portion of TransLink’s Revolving Land Account, will be excluded from the Accumulated Funding Resources balance. For the first three years of During any 10-year Investment Plan period the Accumulated Funding Resources, as defined as above, may not be lower than 15 percent of total Ongoing Operating Expenditures plus Ongoing Debts Service Costs.1 During the remaining seven years of any 10-year Investment Plan period the Accumulated Funding Resources, as defined above, may not be lower than 12 percent of total Ongoing Operating Expenditures plus Ongoing Debts Service Costs.

Management will ensure that the minimum reserve requirements set out above for Funded Cumulative Reservethe Accumulated Funding Resources are met at all times. The Audit Committee will review the level of the Funded Cumulative ReserveAccumulated Funding Resources annually as part of its approval of the 10‐Year Financial Strategic Plan(s).Investment Plan.

6. Reporting

The Chief Financial Officer and Executive Vice President, Finance and Corporate Services will provide the Audit Committee status updates as part of the quarterly financial report.

7. Adoption and Review of Policy

The Audit Committee will review the Budgeted Contingency Reserve and Accumulated Funding Resources Policy annually to ensure congruence with the changing activities of TransLink, market conditions, technology, evolving regulatory standards and best practices.

1 Includes Operating Expenditures (excluding municipal capital infrastructure contributions), Interest Expense and

Debt Principal Repayments.

5

TRANSLINK BUDGETED CONTINGENCY AND

ACCUMULATED FUNDING RESOURCESRESERVE POLICY


2 Includes Operating Expenditures, Interest Expense and Capital Repayments

TO: Audit Committee



SUBJECT: September 30, 2016 Financial and Performance Report

The attached report provides an overview of TransLink’s third quarter financial and performance results relative to the targets set and the results for the prior year.

Page 1

TABLE OF CONTENTS 1. Financial and Performance Summary ............................................................................................ 3

Key Priorities ........................................................................................................................................... 3 Strategic Regional Transportation Investments ..................................................................................... 5

2. Financial and Operating Summary ................................................................................................ 7 Financial Indicators ................................................................................................................................. 8 Operating Indicators ............................................................................................................................... 9

3. Consolidated Statement of Operations Analysis .......................................................................... 11 Consolidated Revenues ........................................................................................................................ 11 Consolidated Expenses by Segment ..................................................................................................... 17

4. Investment in Capital Assets....................................................................................................... 21 Active Capital Projects .......................................................................................................................... 22 Approved in Principle (AIP) Capital Projects ........................................................................................ 22 Substantially Complete Capital Projects............................................................................................... 23 Closed Capital Projects ......................................................................................................................... 23 Cancelled Capital Projects .................................................................................................................... 23 Capital Infrastructure Contributions .................................................................................................... 23

5. Changes in Financial Position ...................................................................................................... 24 Financial Assets .................................................................................................................................... 24 Liabilities ............................................................................................................................................... 25 Non-Financial Assets ............................................................................................................................ 25

6. Liquidity and Capital Resources .................................................................................................. 26 Cash Flows and Liquidity ...................................................................................................................... 26 Debt ...................................................................................................................................................... 27

Appendix I – Consolidated Financial Statements ............................................................................... 28 Consolidated Statement of Financial Position ..................................................................................... 28 Consolidated Statement of Operations ................................................................................................ 29 Consolidated Statement of Changes in Net Debt ................................................................................. 30 Consolidated Statement of Cash Flows ................................................................................................ 31 Segment Report .................................................................................................................................... 33

Appendix II – Allocated Costs between Divisions ............................................................................... 34 Appendix III – KPI’s .......................................................................................................................... 35

Page 2

Caution Regarding Forward-Looking Statements From time to time, TransLink makes written and/or oral forward-looking statements, which may appear in this document and in other communications. In addition, representatives of TransLink may make forward-looking statements orally to analysts, investors, the media and others. Forward-looking statements, by their nature, require TransLink to make assumptions and are subject to inherent risk and uncertainties. In light of the uncertainty related to the financial, economic, and regulatory environments, such risks and uncertainties, many of which are beyond TransLink’s control, and the effects of which can be difficult to predict, may cause actual results to differ materially from the expectations expressed in the forward-looking statements.

Page 3

1. Financial and Performance Summary As the integrated, multi-modal transportation authority for Metro Vancouver, TransLink plans, finances, and operates the transportation network to help meet the unique needs of this region. Our vision is to create a better place to live, built on transportation excellence. Guided by our regional transportation strategy, we work to connect the region and enhance its livability by providing a sustainable transportation system network.

TransLink manages to a funding model required under the South Coast British Columbia Transportation Authority (SCBTA) Act. The nine months ending September 30, 2016, resulted in a $43.3 million funded resource, $20.1 million better than the prior year and $71.0 million better than budget. Key factors resulting in better-than-budget results include:

• Higher revenue mainly from Fares, Fuel and Parking Rights tax, and Golden Ears Bridge tolls • Lower diesel fuel costs due to market prices • Lower lease costs due to early buy out of 28 West Coast Express railcars in December 2015 • Lower salary costs related to additional vacancy savings • Timing of one-time costs related to Evergreen Line integration and Rapid Transit studies

Offset by:

• Higher credit card fees associated with direct fare product sales including Compass Cards and Tickets

• Higher fare media costs • Higher maintenance and materials costs within the Bus and Rail divisions

With the closing of the fare gates this spring, 2016 has already been a big year for TransLink. Fare revenues have increased 6.1 per cent over the same period in 2015 indicating the success of the Compass system. As we get ready for the opening of the Evergreen Extension in December, we are on the cusp of another monumental event in our organization’s history. Once the Evergreen Extension is completed, Metro Vancouver will have the longest, fully-automated, driverless, rapid-transit system in the world.

Key Priorities TransLink’s core mandate is the delivery of safe and reliable transportation services. Our priority is making the system better for the customers who rely on us every day to get where they need to go. The following is an update on the six priorities that guided the organization in 2016. Highlights of the first nine months of 2016 include:

1. Safety and Security – Continually improve the current record of safe and secure operations.

The safety and security of customers, staff and assets remain a primary focus. TransLink committed to take action on all the recommendations of the 2014 Independent Review of SkyTrain by 2019. To date, nine of the 20 recommendations have been implemented, and the others are all underway, in various stages of planning, budgeting or implementation.

The Asset Management Plan for the enterprise was developed in summer 2016. A proof-of-concept Asset Portfolio System is now operational. A Decision Support Tool for major capital investments was piloted as part of the 2017 capital planning cycle. The functional requirements for the modernization of

http://www.translink.ca/en/About-Us/Corporate-Overview/Vision-Mission-and-Values.aspx

http://www.translink.ca/en/Plans-and-Projects/Regional-Transportation-Strategy.aspx

http://www.translink.ca/en/Plans-and-Projects/Regional-Transportation-Strategy.aspx

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the British Columbia Rapid Transit Company Ltd. (BCRTC) operations asset management system are being defined, with system deployment scheduled to start in 2017.

The Safety Management System (SMS) revisions at Coast Mountain Bus Company to be compliant with the international Occupational Health and Safety Assessment Series (OHSAS 18001) standard are on track for completion of the individual elements in the maintenance division by the first quarter of 2017, and full operationalization of the SMS in all divisions by the first quarter of 2018. Existing safety program components are being transferred to the new SMS on an ongoing basis.

Work also continues on preparing an enterprise-wide safety strategy including the enhancement of our Emergency, Disaster Recovery and Business Continuity Plans.

2. Improving Customer Service and Experience – Continually improve customer satisfaction and employee engagement ratings.

We run a safe, efficient and reliable transit system, and our customer satisfaction rating at the end of the third quarter was 7.6 out of 10, up from 7.5 in 2015. We continue to deliver on an improved customer experience by consulting on transit service changes and transit fares; introducing complementary Wi-Fi service at SeaBus stations and providing enhanced outreach efforts to provide assistance to customers during the transition to Compass. We will continue to engage customers on a variety of projects to better understand their needs and deliver solutions.

3. Increasing Ridership – Increase annual ridership at or above the annual rate of population

growth.

We continue to look for opportunities to reallocate resources from routes with low productivity to those with higher customer demand. Since 2010, TransLink has reallocated 420,000 bus revenue hours to bring more service to more customers through more than 300 service improvements across Metro Vancouver. TransLink has recently started implementing more than 80 changes to the transit network. These will result in greater customer convenience, reliability and help facilitate future ridership growth. To-date, fourteen of the 26 approved packages consulted on during the Transit Network Review have now been implemented. With Compass data now available as the data source for ridership numbers, comparisons to 2015 are difficult. The previous methodology used for estimating ridership was very different. It is estimated that boardings system-wide have grown approximately 2 percent. With the introduction of Compass, TransLink is leveraging the opportunities it affords and the data produced to look for additional information to encourage ridership where we have existing capacity.

4. Modernizing BCRTC – Achieve and maintain a State of Good Repair.

Over the past nine months, BCRTC has placed significant resources into maintenance and preparing for the opening of the Evergreen extension of the Millennium Line. In the third quarter, the Rail division successfully launched two new Mark III trains into revenue service – increasing capacity on the Expo Line. These continuous four-car trains are the first rolling stock additions to the fleet since 2010 and increases the number of train cars to 286. BCRTC has also dedicated resources towards further progression of the independent SkyTrain review recommendations.

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5. Building a Performance Measurement Culture – Demonstrate outcomes delivered for funding

provided.

We provide an essential public service and must manage the expectations of multiple stakeholders to whom we are accountable. In the first nine months of 2016, we moved forward with strategies that focus on: measurable outcomes, aligning resources, defining key performance indicators, and tracking our performance on a regular basis.

6. Building Public Trust and Confidence – Build public trust and confidence in TransLink.

A good reputation and strong brand helps to increase ridership; attract and retain top talent; and improve customer service, stakeholder engagement and communication with the public at large. We continue to hold open board meetings to be more transparent; the most recent one was held on September 23, 2016.

Our efforts to build public trust and confidence include: raising awareness of opportunities to get involved in stakeholder engagement and public consultation; being more open and transparent through open board meetings; improving the customer experience, including a program of helping customers transition to Compass; and demonstrating our progress on achieving key performance indicators.

Strategic Regional Transportation Investments In addition to working on these key priorities and delivering on our core mandate of safe and reliable day-to-day transportation services, we have been working on applications to secure federal and provincial funding on several major transportation investments. The investments include:

Replacement of Pattullo Bridge: A deck rehabilitation project on the 79-year-old Pattullo Bridge, to keep it functional and safe to operate until a replacement bridge is built, was completed one month earlier than planned. Work was focused on essential deck repairs to address concrete delamination on sections of the bridge. Repairs were designed to extend the life of the bridge deck with minimum maintenance to keep the bridge operational while a replacement bridge is designed and built. In the meantime, TransLink will continue to regularly inspect the bridge and make necessary repairs in the future to maintain safety and functionality.

In the first nine months of 2016, we worked with Partnerships BC and submitted our business case to seek funding for a new bridge. While our application is considered, procurement readiness is progressing with a current project schedule for a new bridge to open in late 2022 or early 2023.

Rapid Transit projects: The Millennium Line Broadway Extension and South of Fraser Rapid Transit Project were identified as regional priorities in the Mayors’ Council vision. We continue to work with municipal partners to define the scope and costs of these projects. The work we are doing now will help us develop business cases and set the groundwork to secure funding.

On March 22, 2016, the Government of Canada announced its new Federal Public Transit Infrastructure Program, an initial investment of at least $370 million into transit for Metro Vancouver. This is welcome news and brings the region closer to moving forward with the critical infrastructure projects identified in the Mayors’ Vision that require funding from senior government partners. We are continuing to work

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with federal, provincial and municipal partners to ensure we are ready to go on these important investments. On September 16th, the Mayors’ Council approved a resolution for TransLink to prepare a 2017 Investment Plan for public consultation that includes the first three years of transit expansion from the Mayors’ Vision. This includes increases in bus services, rail services and more SeaBus and HandyDart service. If the Investment Plan is approved by the Board and the Mayors’ Council, expansion would begin in January 2017 resulting in commensurate increases to ridership over the next five years.

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2. Financial and Operating Summary

The funded resource for the nine months ending September 30 was $43.3 million, $20.1 million higher than the same period in 2015, and $71.0 million higher than budget. Compared to 2015, funded revenues increased $58.3 million (5.7 per cent) largely due to transit revenue, fuel tax, and property tax revenues. Compared to budget, the main increases are transit revenue, fuel tax, and parking rights tax revenue. Year to date funded expenses compared to the same period in 2015 were $38.1 million (3.8 per cent) higher due to increases in contractual labour, increased maintenance and materials costs within the bus and rail divisions, increases in contracted services mainly related to Compass and Canada Line, increases in one-time costs related to Compass implementation, increased fare media costs and credit card fees, costs related to Pattullo Bridge replacement and Rapid Transit studies. These expenses are offset by the elimination of lease costs related to the purchase of West Coast Express rail cars, lower diesel fuel costs and one-time Plebiscite costs in 2015.

Compared to budget, funded expenses were $15.2 million (1.4 per cent) lower due to lower diesel fuel costs, timing of feasibility studies related to rapid transit, lower lease costs related to the buyout of 28 West Coast Express rail cars in December 2015, and lower salary costs related to additional vacancy savings. These savings are offset by higher credit card interchange fees associated with direct fare product sales including Compass cards and tickets, higher fare media costs and higher maintenance and materials costs within the bus and rail divisions.

CONSOLIDATED REVENUES AND EXPENSESYTD YTD YTD ANNUAL ANNUAL

Nine months ending September 30 2015 2016 2016 2016 2016($ thousands) ACTUAL ACTUAL Fav/(Unfav) % BUDGET Fav/(Unfav) % Q3 FORECAST BUDGET ** Fav/(Unfav) %

RevenueTaxation 577,329 613,505 36,176 6.3% 588,176 25,329 4.3% 814,102 784,532 29,570 3.8%Transit 381,090 402,855 21,765 5.7% 378,187 24,668 6.5% 540,682 508,272 32,410 6.4%Government transfers 154,837 154,684 (153) (0.1%) 173,464 (18,780) (10.8%) 175,712 282,185 (106,473) (37.7%)Golden Ears Bridge tolling 36,564 40,199 3,635 9.9% 37,745 2,454 6.5% 53,022 50,641 2,381 4.7%Interest income 25,323 30,207 4,884 19.3% 27,176 3,031 11.2% 39,609 36,172 3,437 9.5%Amortization of deferred concessionaire credit 17,407 17,471 64 0.4% 17,407 64 0.4% 23,401 23,337 64 0.3%Miscellaneous 4,662 4,463 (199) (4.3%) 2,664 1,799 67.5% 5,697 3,537 2,160 61.1%Sub Total Continuing Operations 1,197,212 1,263,384 66,172 5.5% 1,224,819 38,565 3.1% 1,652,225 1,688,676 (36,451) (2.2%)Gain on disposal 2,366 68 (2,298) (97.1%) - 68 100.0% 17,134 - 17,134 100.0%

Total Revenue (PSAB) 1,199,578 1,263,452 63,874 5.3% 1,224,819 38,633 3.2% 1,669,359 1,688,676 (19,317) (1.1%)Revenue Funded Adjustments (178,398) (184,011) (5,613) (3.1%) (201,215) 17,204 8.6% (214,358) (319,256) 104,898 32.9%

Total Funded Revenue 1,021,180 1,079,441 58,261 5.7% 1,023,604 55,837 5.5% 1,455,001 1,369,420 85,581 6.2%

ExpendituresBus Division 479,511 488,793 (9,282) (1.9%) 491,917 3,124 0.6% 655,774 658,556 2,782 0.4%Corporate operations 53,038 63,824 (10,786) (20.3%) 67,658 3,834 5.7% 88,832 89,443 611 0.7%Rail Division 196,560 196,885 (325) (0.2%) 199,310 2,425 1.2% 266,594 265,642 (952) (0.4%)Roads & Bridges 39,457 49,351 (9,894) (25.1%) 64,653 15,302 23.7% 73,392 89,095 15,703 17.6%Transit Police 24,161 24,740 (579) (2.4%) 25,496 756 3.0% 33,327 33,847 520 1.5%Amortization of Capital Assets* 121,277 131,121 (9,844) (8.1%) 124,779 (6,342) (5.1%) 188,268 181,520 (6,748) (3.7%)Interest* 125,533 128,541 (3,008) (2.4%) 126,168 (2,373) (1.9%) 172,953 168,203 (4,750) (2.8%)Sub Total Continuing Operations 1,039,537 1,083,255 (43,718) (4.2%) 1,099,981 16,726 1.5% 1,479,140 1,486,306 7,166 0.5%Corporate - onetime 12,527 18,402 (5,875) (46.9%) 23,778 5,376 22.6% 30,932 30,301 (631) (2.1%)

Total Expenditures (PSAB) 1,052,064 1,101,657 (49,593) (4.7%) 1,123,759 22,102 2.0% 1,510,072 1,516,607 6,535 0.4%Expenditures Funded Adjustments (54,100) (65,545) 11,445 21.2% (72,483) (6,938) (9.6%) (103,201) (113,677) (10,476) (9.2%)

Total Funded Expenditures 997,964 1,036,112 (38,148) (3.8%) 1,051,276 15,164 1.4% 1,406,871 1,402,930 (3,941) (0.3%)

Surplus for the period (PSAB) 147,514 161,795 14,281 9.7% 101,060 60,735 60.1% 159,287 172,069 (12,782) (7.4%)

Net Surplus (Deficit) for Funding Purposes 23,216 43,329 20,113 86.6% (27,672) 71,001 256.6% 48,130 (33,510) 81,640 243.6%

Cumulative Funding Resources Opening Balance 365,208 365,440 232 0.1% 365,440 - 0.0% 365,440 365,440 - 0.0%Cumulative Funding Resources Ending Balance 388,424 408,769 20,345 5.2% 337,768 71,001 21.0% 413,570 331,930 81,640 23.9%

* Amortization and Interest shown separately to facilitate analysis** Restated to reflect budget transfers

Change

FORECAST TO BUDGETACTUAL TO BUDGETYEAR OVER YEAR

Change Change

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Financial Indicators

In the first nine months of 2016, the cumulative funding resources increased $43.3 million (11.9 per cent) to $408.8 million. Tangible capital assets have increased by $49.3 million in the first nine months primarily as a net result of $180.4 million in additions offset by amortization expense of $131.1 million. Asset additions consist primarily of work in progress on the Evergreen Extension and the new Hamilton Transit Centre. Net direct debt decreased by $102.6 million (5.2 per cent) due to sinking fund contributions made during the year, and lower outstanding amount of short-term commercial paper. Indirect P3 debt, which includes the liability owed to the Golden Ears Bridge contractor and the Canada Line deferred concessionaire credit, declined by $18.7 million (1.2 per cent) due to the amortization of the Canada Line deferred concessionaire credit. Gross interest cost as a percentage of operating revenue dropped slightly to 12.0 percent. This is within TransLink’s 20 per cent policy limit.

FINANCIAL INDICATORS December 31 September 302015 2016

($ thousands) ACTUAL ACTUAL Change %

Cumulative funding resources 1 365,440 408,769 43,329 11.9%Capita l assets 4,606,623 4,655,926 49,303 1.1%

Net di rect debt 2 (1,989,934) (1,887,302) (102,632) (5.2%)Indirect P3 debt 3 (1,623,309) (1,604,561) (18,748) (1.2%)Tota l net di rect debt and indirect P3 debt (3,613,243) (3,491,863) (121,380) (3.4%)

Gross interest cost as a % of operating revenue 4 12.4% 12.0% (0.4%) (3.3%)

1 Cumulative funding resources as calculated under the SCBCTA Act is the amount of resources available to fund future operations2 Includes debt as per the balance sheet, net of TransLink sinking funds and debt reserve deposits3 Includes Deferred concessionaire credit for Canada Line and Contractor liability for Golden Ears Bridge4 Ratio of YTD results. Operating revenue includes fares, taxation, GEB toll revenue, operating transfers from Provincial government and miscellaneous income.

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Operating Indicators

Scheduled Transit Service (Conventional) The overall performance rating is 7.6 at the end of the first nine months, an improvement of 0.1 over 2015 and on target for 2016. Top-of-mind for customers was the desire for more service frequency and service reliability. We will continue to engage customers on a variety of projects to make improvements. Service hours are higher year-over-year mostly due to the extra service day resulting from a leap year in 2016. Compared to budget, service hours are lower due to differences in scheduling and other service adjustments. The cost recovery ratio was 0.3 per cent higher than the first nine months of 2015 due to higher fare revenues offset by higher operating expenses arising from labour, economic and contractual increases. Compared to budget, the cost recovery ratio was 8.9 per cent higher due to higher fare revenues and lower expenses than expected mainly related to fuel costs. The operating cost per capacity kilometre was 2.4 per cent higher than the prior year due to higher operating expenses arising from labour, economic and contractual increases. Complaints per million boarded passengers are lower mainly due to lower complaints to the rail division.

OPERATING INDICATORSYTD YTD YTD2015 2016 2016

Nine months ending September 30 ACTUAL ACTUAL Fav/(Unfav) % BUDGET Fav/(Unfav) %

Scheduled Transit ServiceOverall Performance Rating (out of 10) 7.5 7.6 0.1 1.3% 7.6 - - Service Hours 4,674,062 4,733,153 59,091 1.3% 4,762,386 (29,233) (0.6%)Cost Recovery Ratio 1 53.6% 53.7% 0.1% 0.3% 49.4% 4.4% 8.9%Operating Cost per Capacity Km 1,2 $0.083 $0.086 ($0.002) (2.4%) $0.086 - - Complaints per million Boarded Passengers 93.1 88.7 4.4 4.7% 90.9 2.2 2.4%

Access Transit ServiceNumber of Trips 901,084 937,516 36,432 4.0% 901,648 35,868 4.0%Operating Cost per Trip $41.31 $39.69 $1.62 3.9% $41.10 $1.41 3.4%Number of Trips Denied 952 1,458 (506) (53.2%) 1,122 (336) (29.9%)Operator Complaints as a percentage of trips 0.03% 0.05% (0.01%) (28.6%) 0.04% (0.01%) (26.8%)Service Complaints as a percentage of trips 0.07% 0.07% - - 0.07% - -

Golden Ears BridgeCrossings (thousands) 9,505.2 10,259.9 754.7 7.9% 9,632.5 627.4 6.5%Average Toll per Crossing 3 3.65 3.69 $0.04 1.1% 3.71 ($0.02) (0.5%)

Ridership (thousands)Preliminary Boarded Passengers 4 n/a 291,584 - - 268,705 22,879 8.5%Preliminary Journeys 5 n/a 175,210 - - n/a - - Average Fare per Journey 5 n/a $2.30 - - n/a - -

1 YTD 2015 figures have been restated2 Includes operating costs of Bus, SeaBus, Expo & Millennium line, Canada Line, West Coast Express and Police, and excludes depreciation and interest expense3 Average toll per crossing was restated in 2015 to exclude interest on outstanding accounts and allowance for doubtful accounts4 In 2016, a new ridership estimation methodology was introduced5 Journeys have replaced revenue passengers as the new ridershp methodology, therefore comparative historic and budget figures are not available

YEAR OVER YEAR ACTUAL TO BUDGETChange Budget Variance

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Access Transit Service Access Transit trips increased 4.0 per cent over 2015 resulting in 36,432 additional trips delivered. Compared to budget, delivered trips increased 4.0 per cent or 35,868 trips. Operating costs per trip decreased both year-over-year and compared to budget mainly due to an increase in taxi supplement trips delivered. Supplemental taxi trips have a lower cost than traditional HandyDART service. Despite the increase in number of trips delivered, trip denial increased both year-over-year and compared to budget due to demand exceeding available capacity. Some extra service hours have been implemented in 2016 to help reduce denials. Golden Ears Bridge Total vehicle crossings increased 7.9 per cent over the first nine months of 2015. The recent upward trend in crossings is consistent with increased Vehicle Kilometres Travelled (VKTs) in the region, as seen with Fuel tax and Parking Rights tax. The average toll per crossing increased $0.04 (1.1 per cent) over 2015 due to the annual inflation-adjusted toll rate and a change in vehicle mix from smaller vehicles to trucks, offset by increased out of province and exempt vehicle crossings. Total crossings for the first nine months of 2016 were 6.5 per cent higher than budget. A portion of this increase is in out-of-town and exempt vehicle crossings which are driving down the average toll per crossing compared to budget. Ridership With Compass data now available as the data source for ridership numbers, comparisons to 2015 are difficult. The previous methodology used for estimating ridership was very different. It is estimated that boardings system-wide have grown approximately 2 percent. A “Journey” has been introduced as a new ridership metric and is a complete trip on transit using valid fare media (i.e., Compass fare media which has been tapped) regardless of the number of transfers taken within the transfer window. 175 million Journeys have been made in the first nine months of 2016.

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3. Consolidated Statement of Operations Analysis

Consolidated Revenues

Overview Funded revenues for the first nine months of 2016 were $1.1 billion, an increase of $58.3 million (5.7 per cent) over the same period in 2015. This increase was driven by higher taxation revenue, mainly from fuel volume sales, and higher transit revenues. Funded revenues were $55.8 million (5.5 per cent) better than budget. Year over year

Taxation

Taxation revenues were $36.2 million (6.3 per cent) higher than the same period in 2015. Fuel tax revenues increased $26.1 million (9.8 per cent) compared to last year largely due to higher sales volumes with moderate pump prices, higher VKT and an unfavourable CAD/USD exchange rate, possibly making cross border purchasing less attractive. Fuel volumes, as reported by the Province of British Columbia’s Consumer Taxation Branch, continue to show steady growth. External market data for retail fuel sales also confirms this upward trend in 2016.

CONSOLIDATED REVENUESYTD YTD YTD Annual Annual

Nine months ending September 30 2015 2016 2016 2016 2016($ thousands) ACTUAL ACTUAL Fav/(Unfav) % BUDGET Fav/(Unfav) % Q3 FORECAST BUDGET Fav/(Unfav) %

Taxation 577,329 613,505 36,176 6.3% 588,176 25,329 4.3% 814,102 784,532 29,570 3.8%Transit 381,090 402,855 21,765 5.7% 378,187 24,668 6.5% 540,682 508,272 32,410 6.4%Government transfers 154,837 154,684 (153) (0.1%) 173,464 (18,780) (10.8%) 175,712 282,185 (106,473) (37.7%)Golden Ears Bridge tolling 36,564 40,199 3,635 9.9% 37,745 2,454 6.5% 53,022 50,641 2,381 4.7%Interest income 25,323 30,207 4,884 19.3% 27,176 3,031 11.2% 39,609 36,172 3,437 9.5%Amortization of deferred concessionaire credit 17,407 17,471 64 0.4% 17,407 64 0.4% 23,401 23,337 64 0.3%Miscellaneous 4,662 4,463 (199) (4.3%) 2,664 1,799 67.5% 5,697 3,537 2,160 61.1%Revenue Before Gain/(Loss) on Disposals 1,197,212 1,263,384 66,172 5.5% 1,224,819 38,565 3.1% 1,652,225 1,688,676 (36,451) (2.2%)Gain on disposal 2,366 68 (2,298) (97.1%) - 68 100.0% 17,134 - 17,134 100.0%Total Revenue (PSAB) 1,199,578 1,263,452 63,874 5.3% 1,224,819 38,633 3.2% 1,669,359 1,688,676 (19,317) (1.1%)

Funding AdjustmentsGovernment transfers for capital assets (138,980) (139,450) (470) (0.3%) (159,088) 19,638 12.3% (155,627) (262,959) 107,332 40.8%Debt Service Cost - Interest Income (22,011) (27,090) (5,079) (23.1%) (24,720) (2,370) (9.6%) (35,330) (32,960) (2,370) (7.2%)Amortization of Deferred Concessionaire Credit (17,407) (17,471) (64) (0.4%) (17,407) (64) (0.4%) (23,401) (23,337) (64) (0.3%)Total Funding Adjustments (178,398) (184,011) (5,613) (3.1%) (201,215) 17,204 8.6% (214,358) (319,256) 104,898 32.9%

Total Funded Revenue 1,021,180 1,079,441 58,261 5.7% 1,023,604 55,837 5.5% 1,455,001 1,369,420 85,581 6.2%

Forecast Variance

YEAR OVER YEAR ACTUAL TO BUDGET FORECAST TO BUDGET

Budget VarianceChange

TAXATION REVENUESYTD YTD

Nine months ending September 30 2015 2016($ thousands) ACTUAL ACTUAL Fav/(Unfav) %

Fuel 266,082 292,179 26,097 9.8%Property & Replacement 249,071 256,161 7,090 2.8%Parking Rights 47,127 49,918 2,791 5.9%Hydro Levy 15,049 15,247 198 1.3%

Total Taxation 577,329 613,505 36,176 6.3%

ChangeYEAR OVER YEAR

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Property and replacement tax revenue increased by $7.1 million (2.8 per cent) over 2015, which is in line with the legislated allowable increase, net of an allowance for adjustments when tax rolls are finalized. Parking Rights tax revenue increased by $2.8 million (5.9 per cent) over the same period in 2015, which is consistent with an increase in VKTs and fuel volume sales. Hydro Levy is $198 thousand (1.3 per cent) higher than the same period in 2015 due to an increase in the number of households in the region. This increase is consistent with the projected increase in households as reported by BC Stats.

Transit

Total transit revenues include transit fares and programs and other transit related revenues such as transit advertising, park and ride, and fare infraction revenue. Total transit revenues increased by $21.8 million (5.7 per cent) in comparison to the same nine month period in 2015. Year-over-year revenue from fares was $17.8 million (6.1 per cent) higher than the first nine months of 2015. This increase in fare revenue is a strong indication that the closure of fare gates, high visibility of front line staff and a marketing drive to educate customers on Compass and gate closure were successful in capturing revenue that was previously lost to fare evasion. Increased ridership and a reduction of commission paid through indirect sales also contributed to the increase in fare revenues. This increase was partially offset by a shift in fare product purchases. Sales of single use tickets and monthly passes have decreased from 2015, with customers shifting to Stored Value Compass products which offer a discount in fare price over single use products and feature more flexibility than monthly passes. Program revenue was $3.8 million (5.1 per cent) higher than the first nine months of 2015 mainly due to an increased number of participants in both the U-Pass BC and the BC Bus Pass programs, as well as an annual contractual U-Pass BC rate increase in May. Other Transit Revenue was $188 thousand (1.3 per cent) higher than 2015 as a result of a contractual increase for advertising on our transit system, increased Park and Ride revenues, and new revenues thanks to introduction of Wi-Fi on the SeaBus.

TRANSIT REVENUESYTD YTD


Fares 292,503 310,282 17,779 6.1%Programs 74,301 78,099 3,798 5.1%Total Fare Revenue 366,804 388,381 21,577 5.9%Other 14,286 14,474 188 1.3%

Total Transit 381,090 402,855 21,765 5.7%


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Government Transfers Transfers from government during the first nine months of 2016 were in line with the same period in 2015. However, the 2015 actual of $154.8 million includes an adjustment of $44.1 million pertaining to the year 2014. This adjustment was made due to a required change in accounting treatment related to a new agreement with the Union of British Columbia Municipalities (UBCM), for Federal Gas Tax Funds signed in August 2015. Generally Accepted Accounting Principles for the Public Sector requires that the funds received must now be recorded as revenues at the time the funds are spent. Previously, the contract required the assets to be held for at least ten years and the funds received were then recorded as revenue over the ten year period. Excluding the 2015 adjustment, the 2016 government transfers are higher due to increased expenditures on purchases of conventional buses and for the Hamilton Transit Centre.

Golden Ears Bridge Tolls Toll revenues increased $3.6 million (9.9 per cent) over the same period in 2015. The majority of the increase is due to a 7.9 per cent increase in total vehicle crossings. There was also a Canadian consumer price index (CPI) inflationary toll rate increase in July in accordance with the annual bylaw.

Interest Income Interest income was $4.9 million (19.3 per cent) higher as compared to the prior year, due to higher sinking fund balances and higher rates of return. Miscellaneous Income Miscellaneous income decreased $199 thousand (4.3 per cent) over 2015 primarily as a result of lower activity on the AID (Adjacent and Integrated Development) and Telecom programs. Funding Adjustments Funding adjustments are the changes required to the income statement to calculate the cumulative funding resources under the South Coast British Columbia Transportation Authority Act. The cumulative funding resources are defined as the amount of resources available to fund future operations. The funding adjustments for revenue reflect all senior government contributions for capital assets and the amortization associated with those assets, interest income from sinking fund balances, and amortization of deferred concessionaire credit. The variance year-over-year is largely due to the change in accounting treatment for Federal Gas Tax Funds.

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Actual vs Budget and Forecast

Taxation

Year-to-date taxation revenue is $25.3 million (4.3 per cent) higher than budget and is forecast to be $29.6 million (3.8 per cent) higher at year end. Fuel tax revenues were $21.9 million (8.1 per cent) higher than budget. Low gasoline prices at the pump and an unfavourable CAD/USD exchange rate may be contributing factors to increased sales in the region. Fuel volumes growth is expected to continue for the remainder of the year, resulting in a year end forecast of $24.9 million (6.9 per cent) better than budget. Parking Rights tax revenues were $3.0 million (6.5 per cent) higher than budget and are forecasted to be $4.3 million favourable (6.8 per cent) relative to budget to the end of this year. The Hydro levy is $387 thousand (2.6 per cent) favourable to budget for the first nine months and is expected to be $389 thousand favourable to budget for the full year.

Transit

Year-to-date total transit revenues are $24.7 million (6.5 per cent) higher than budget and forecasted to be $32.4 million (6.4 per cent) higher for the full year due mainly to increased fare revenue resulting from the positive impact of fare gate closures and increased ridership. Year-to-date revenue from fares was $22.6 million (7.9 per cent) favourable to budget mainly as a result of the success of fare gate closures and growing ridership. Since the gates closed in April 2016, fare revenues have exceeded budget expectations by 9.3 per cent, on average, per month. This is a strong indication that the closure of the fare gates, the high visibility of front line staff and a marketing drive to educate customers on Compass were successful in capturing revenue that was previously lost to fare evasion and incorrect fare purchases.

TAXATION REVENUESYTD YTD Annual Annual

Nine months ending September 30 2016 2016 2016 2016($ thousands) ACTUAL BUDGET Fav/(Unfav) % Q3 FORECAST BUDGET Fav/(Unfav) %

Fuel 292,179 270,291 21,888 8.1% 385,259 360,389 24,870 6.9%Property & Replacement 256,161 256,138 23 0.0% 341,540 341,517 23 0.0%Parking Rights 49,918 46,887 3,031 6.5% 66,939 62,651 4,288 6.8%Hydro Levy 15,247 14,860 387 2.6% 20,364 19,975 389 1.9%

Total Taxation 613,505 588,176 25,329 4.3% 814,102 784,532 29,570 3.8%

Budget Variance Forecast Variance

ACTUAL TO BUDGET FORECAST TO BUDGET

TRANSIT REVENUESYTD YTD Annual Annual

Nine months ending September 30 2016 2016 2016 2016($ thousands) ACTUAL BUDGET Fav/(Unfav) % Q3 FORECAST BUDGET Fav/(Unfav) %

Fares 310,282 287,674 22,608 7.9% 413,214 382,864 30,350 7.9%Programs 78,099 77,159 940 1.2% 108,346 107,406 940 0.9%Total Fare Revenue 388,381 364,833 23,548 6.5% 521,560 490,270 31,290 6.4%Other 14,474 13,355 1,119 8.4% 19,123 18,002 1,121 6.2%

Total Transit 402,855 378,188 24,667 6.5% 540,683 508,272 32,411 6.4%

Budget Variance Forecast Variance


Page 15

The forecast for fare revenues is expected to be $30.3 million (7.9 per cent) favourable to budget as the positive revenue growth associated with the roll out of Compass is expected to continue throughout the remainder of the year. Year-to-date program revenue was $940 thousand (1.2 per cent) favourable to budget due to more participants than expected in both the U-Pass BC and BC Bus Pass programs. This favourable variance is forecast to drop slightly to 0.9 per cent as a result of a recent change to the BC Bus Pass program in September whereby low-income persons with disabilities now have the option of a monthly bus pass or a cash equivalent. Other transit revenue was $1.1 million (8.4 per cent) favourable to budget due to increased revenues from fare infractions, park and ride revenues, advertising on our transit system, and new revenues arising from the introduction of Wi-Fi at the SeaBus terminals. The forecast is expected to be $1.1 million (6.2 per cent) higher than budget. Government Transfers Government Transfers were $18.8 million (10.8 per cent) lower than budget due to a difference in the timing of certain projects under the federal gas tax program. The year to date variance includes the following items:

• $14.0 million for the early buyout of the West Coast Express rail car lease • $4.1 million related to scheduling changes to the Compass project • $3.6 million for the Hamilton Transit Center • $11.8 million under the federal gas tax program due to project delays

The above items were offset by a $14.1 million related to early recognition of federal gas tax funding for fleet purchases that were expected to happen later in 2016. The 2016 forecast anticipates lower than budgeted spending of $106.5 million (37.7 per cent). The forecast reduction is due to 2015 revenue recognition of funding related to early buyout of the West Coast Express rail car lease, earlier than expected spending related to the Compass project and the Hamilton Transit Center, and delays in certain projects, the majority of which are fleet purchases of conventional buses and community shuttle vehicles. Golden Ears Bridge Tolls Year-to-date toll revenues were $2.5 million (6.5 per cent) higher than budget mainly resulting from a 6.5 per cent increase in vehicle crossings. Tolling revenue is forecast to be $2.4 million (4.7 per cent) higher than budget by the end of the year due to higher vehicle crossings in the first nine months of the year. Interest Income Interest income was $3.0 million (11.2 per cent) higher in the first nine months of the year due to higher-than-budgeted cash and investment balances and higher rates of return. Interest income is forecast to be $3.4 million (9.5 per cent) higher than budget due to higher-than-budgeted cash and investment balances.

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Miscellaneous Income Miscellaneous income was $1.8 million (67.5 per cent) higher than budget mainly due to higher than anticipated recoveries for Adjacent and Integrated Development projects, an increase in incentive credits from Fortis BC for purchasing CNG vehicles and higher insurance and trolley overhead recoveries. The forecast for the year is expected to be $2.2 million (61.1 per cent) higher than budget for the same reasons. Funding Adjustments The favourable forecast variance of $104.9 million (32.9 per cent) is largely due to timing of revenue recognition for Federal Gas Tax funds due to either earlier or later than expected capital spending.

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Consolidated Expenses by Segment Year over Year

Bus Division operating expenditures were $9.3 million (1.9 per cent) higher year over year due to labour contractual and economic increases, more service hours and kilometres including the impact of one additional service day for leap year in 2016, higher revenue vehicle material costs as a result of more major repairs, contractual increases for transit service contractors, and the impact of opening Hamilton Transit Centre in September. Offsetting these increases is lower fuel costs due to lower market prices. Corporate Operations were $10.8 million (20.3 per cent) higher than the same period in 2015 mainly due to contractor payments related to Compass milestones, higher credit card interchange fees associated with direct fare product sales including Compass cards and tickets, contractual and economic labour increases, and higher computer system related costs. Rail Division costs were $325 thousand (0.2 per cent) higher than the same period in 2015 mainly due to inflationary increase on Canada Line performance payment, additional Canada Line performance payments to operate and maintain auxiliary fare gate equipment, collective agreement escalation, increased state of good repair costs and increased staffing levels offset by the elimination of lease costs related to the purchase of West Coast Express rail cars.

CONSOLIDATED EXPENSES BY SEGMENTYTD YTD


Bus Division 479,511 488,793 (9,282) (1.9%)Corporate operations 53,038 63,824 (10,786) (20.3%)Rail Division 196,560 196,885 (325) (0.2%)Roads & Bridges 39,457 49,351 (9,894) (25.1%)Transit Police 24,161 24,740 (579) (2.4%)Amortization of Capital Assets* 121,277 131,121 (9,844) (8.1%)Interest* 125,533 128,541 (3,008) (2.4%)Sub Total Continuing Operations 1,039,537 1,083,255 (43,718) (4.2%)Corporate - onetime 12,527 18,402 (5,875) (46.9%)Total Expenses by Segment (PSAB) 1,052,064 1,101,657 (49,593) (4.7%)

Funding AdjustmentsCapital infrastructure contributions (9,360) (13,628) 4,268 45.6%Others (123) (1,080) 957 778.0%Long term debt or government contributions (115,509) (124,647) 9,138 7.9%Debt service costs 70,892 73,810 (2,918) (4.1%)Total Funding Adjustments (54,100) (65,545) 11,445 21.2%

Total Funded Expenses 997,964 1,036,112 (38,148) (3.8%)



Page 18

Roads and Bridges spending was $9.9 million (25.1 per cent) higher for the first nine months of 2016 due to timing of capital contributions to municipalities, costs related to the Pattullo Bridge replacement and inflationary rate increases related to operations and maintenance funding for the Major Road Network. Transit Police costs were $579 thousand (2.4 per cent) higher than the same period in 2015. Administrative costs and maintenance and material expenditures are $172 thousand higher due to timing. Professional and legal fees are up by $95 thousand from last year due to the higher legal costs for indemnification of police officers. Salary costs have increased by $413 thousand over the same period due to higher benefit costs and timing of leave accruals. Amortization expense increased $9.8 million (8.1 per cent) over 2015 largely due to the substantial completion of the Compass project, the early lease buyout of 28 West Coast Express rail cars and the accelerated amortization of obsolete capital spare parts. Interest expense was $3.0 million (2.4 per cent) higher than the prior year to date due to higher outstanding gross debt. Corporate one-time costs were $5.9 million (46.9 per cent) higher than the prior year. The 2016 one-time costs include Rapid Transit studies and the Compass project while in 2015 the focus was on the Plebiscite and corporate restructuring.

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Actual vs Budget and Forecast

Bus Division operating expenditures were $3.1 million (0.6 per cent) favourable to budget due to lower fuel market prices, less snow removal expenses in early 2016, and timing differences for various planned activities. The savings were partially offset by higher revenue vehicle materials costs as a result of more major repairs and increased parts prices due to general economic and US exchange rate increases, higher fare media costs, and higher wage costs stemming from collective agreement contractual increases, vacancy coverages and higher levels of required route training for operators in preparation for the opening of Hamilton Transit Centre. The annual forecast is for expenditures to be under budget by $2.8 million (0.4 per cent) due primarily to lower fuel market prices, partially offset by higher forecasted revenue vehicle material costs, higher operator wages stemming from training and coverage for higher than planned retirements in addition to the bus route and service relocations associated with the closure of North Vancouver and Oakridge transit centres and the opening of Hamilton, increased fare media costs, and the provision of additional unbudgeted Access Transit service and trips to meet customer demand. Corporate Operations expenses were $3.8 million (5.7 per cent) lower than budget mainly due to timing of feasibility studies, professional fees, and higher vacancies; offset by higher credit card fees. The annual forecast is expected to be $611 thousand (0.7 per cent) lower than budget mainly due to savings resulting from additional vacancy savings, offset by higher credit card fees. Rail Division operating costs were $2.4 million (1.2 per cent) lower than budget as a result of the early execution of the West Coast Express (WCE) rail car lease buyout in December 2015 and lower diesel fuel costs. These savings were offset by the Canada Line contractual inflation rate in excess of budget, additional state of good repair costs, higher fare media costs, and additional overtime.

CONSOLIDATED EXPENSES BY SEGMENTYTD YTD Annual Annual

Nine months ending September 30 2016 2016 2016 2016($ thousands) ACTUAL BUDGET Fav/(Unfav) % Q3 FORECAST BUDGET ** Fav/(Unfav) %

Bus Division 488,793 491,917 3,124 0.6% 655,774 658,556 2,782 0.4%Corporate operations 63,824 67,658 3,834 5.7% 88,832 89,443 611 0.7%Rail Division 196,885 199,310 2,425 1.2% 266,594 265,642 (952) (0.4%)Roads & Bridges 49,351 64,653 15,302 23.7% 73,392 89,095 15,703 17.6%Transit Police 24,740 25,496 756 3.0% 33,327 33,847 520 1.5%Amortization of Capital Assets* 131,121 124,779 (6,342) (5.1%) 188,268 181,520 (6,748) (3.7%)Interest* 128,541 126,168 (2,373) (1.9%) 172,953 168,203 (4,750) (2.8%)Sub Total Continuing Operations 1,083,255 1,099,981 16,726 1.5% 1,479,140 1,486,306 7,166 0.5%Corporate - onetime 18,402 23,778 5,376 22.6% 30,932 30,301 (631) (2.1%)Total Expenses by Segment (PSAB) 1,101,657 1,123,759 22,102 2.0% 1,510,072 1,516,607 6,535 0.4%

Funding AdjustmentsCapital infrastructure contributions (13,628) (27,348) (13,720) (50.2%) (21,506) (38,556) (17,050) (44.2%)Others (1,080) - 1,080 100.0% (1,081) - 1,081 100.0%Amortization expense-assets funded by

long term debt or government contributions (124,647) (118,708) 5,939 5.0% (178,108) (172,499) 5,609 3.3%Debt service costs 73,810 73,573 (237) (0.3%) 97,494 97,378 (116) (0.1%)Total Funding Adjustments (65,545) (72,483) (6,938) (9.6%) (103,201) (113,677) (10,476) (9.2%)

Total Funded Expenses 1,036,112 1,051,276 15,164 1.4% 1,406,871 1,402,930 (3,941) (0.3%)


** Restated to reflect budget transfers

Forecast VarianceBudget Variance


Page 20

The additional state of good repair costs include incremental efforts and costs required to complete budgeted rail grinding work, as well as unbudgeted expenditures on railborne equipment, elevating devices and rolling equipment repair costs. The forecast for 2016 is $1.0 million (0.4 per cent) higher than budget as a result of additional state of good repair, higher fare media costs, Canada Line inflation rate in excess of budget, the recognition of increased vacation liability, and additional overtime. These items are offset by the early execution of the WCE railcar lease buyout, unbudgeted recoveries, additional vacancies and favourable diesel fuel, hydro and benefit costs. Roads & Bridges spending was $15.3 million (23.7 per cent) lower than budget for the first nine months of 2016. The majority of this amount is due to timing differences for municipal road contributions. Forecasted spending is expected to be $15.7 million (17.6 per cent) lower than budget mainly due to the timing of municipal contributions offset by studies costs related to the Pattullo Bridge replacement. Transit Police costs are $756 thousand (3.0 per cent) favourable to budget mainly due to vacancies and lower overtime costs. Forecasted spending is expected to be $520 thousand (1.5 per cent) below budget largely due to existing vacancies and lower overtime costs. Amortization expense was $6.3 million (5.1 per cent) Higher than budget due to the early buyout of the West Coast Express railcars in December 2015, earlier than planned capitalization of the following projects; Conventional bus replacement, Compass, Trolley Overhead rectifier replacement, and HandyDART vehicles replacement; and accelerated amortization of obsolete capital spare parts. The forecast for the year is $6.7 million (3.7 per cent) higher than budget mainly due to earlier than planned project completions. Interest expense was $2.4 million (1.9 per cent) higher than budget, due mostly to timing of capital spending and higher than anticipated interest rates associated with the prior year’s long-term debt issuance. The forecast is expected to be $4.8 million (2.8 per cent) higher than budget by year end. Corporate one-time costs were $5.4 million (22.6 per cent) lower than budget for the first nine months of the year mainly due to timing of Evergreen Line integration costs and Rapid Transit studies. The 2016 forecast is expected to be $631 thousand (2.1 per cent) higher than budget mainly due to Rapid Transit studies related to the Millennium Line Broadway Extension and South of Fraser Rapid Transit projects, and Compass related one-time costs.

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4. Investment in Capital Assets

As of September 30, 2016, TransLink’s total capital program budget is $2.7 billion; it includes $1.1 billion in active projects, $174.3 million in Approved-In-Principle (AIP) capital projects and $210.0 million in capital infrastructure contributions to municipalities. The capital program budget is partially supported by $875.0 million in committed funding available to TransLink, primarily from the Federal Gas Tax Fund and the Building Canada Fund. This funding applies only to eligible projects within the capital program. The table below highlights the breakdown of TransLink’s capital budget.

Summary of Capital Program ($ thousands)

Number of

Projects

Current Budget

2016 YTD Spending

Cumulative Spending to

Date

Final Forecast Cost

Senior Government

Funding (Committed)

($) ($) ($) ($) ($) (%) ($)Capital Projects

Active Capital ProjectsEquipment 9 23,190 4,115 6,045 22,000 1,190 5.1% 4,500 Faci l i ties 8 13,761 1,125 2,317 12,806 955 6.9% - Infrastructure 29 309,421 56,978 116,279 306,457 2,964 1.0% 99,073 Major Construction 3 409,630 22,496 250,513 401,477 8,152 2.0% - Technology Appl ications 21 31,259 4,787 12,082 29,273 1,986 6.4% - Vehicle - Non Revenue 2 1,780 344 559 1,666 114 6.4% - Vehicle - Revenue 7 282,362 63,333 75,975 275,250 7,112 2.5% 172,704 Subtotal Active Capital Projects 79 1,071,403 153,178 463,770 1,048,930 22,473 2.1% 276,277

2016 Capital Budget (AIP)*Equipment 3 21,150 21,150 - - Faci l i ties - - - - - Infrastructure 6 26,582 26,582 - - Major Construction 0 - - - - Technology Appl ications 2 1,725 1,725 - - Vehicle - Non Revenue 6 2,019 2,019 - - Vehicle - Revenue 5 122,800 122,800 - 23,773 Subtotal Approved in Principle 22 174,276 - 174,276 - 23,773 *Includes submissions from current and prior year AIP programs

Subtotal Active and AIP Projects 101 1,245,679 153,178 463,770 1,223,206 22,473 2.1% 300,050

Substantially Complete Projects 63 1,169,380 64,998 1,119,115 1,152,942 16,438 1.4% 558,047 Closed Projects 19 71,018 519 64,782 64,782 6,236 8.8% 16,845 Cancelled AIP Projects -6 7,640 7,640 - 0.0% -

Total Capital Projects 177 2,493,717 218,695 1,647,667 2,448,570 45,147 1.8% 874,942

Capital Infrastructure ContributionsActive and Approved in Principle 13 186,227 11,310 152,280 184,695 1,532 0.8% - 2016 Program 1 23,784 6,835 6,835 24,015 (231) -1.0% -

Total Capital Infrastructure Contributions 14 210,011 18,145 159,115 208,710 1,301 0.6%

Capital Program Q3 AccrualsActive Capital Projects (10,322) Capital Infrastructure Contributions (4,518)

Capital Program Grand Total 191 2,703,728 222,000 1,806,782 2,657,280 46,448 1.7% 874,942

Variance to Current Budget

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Active Capital Projects TransLink’s active capital projects portfolio has two main objectives:

1. Support a safe and reliable transit system by maintaining assets in a state of good repair. 2. Improve service by increasing system capability and capacity.

As at the end of September 2016 there are 79 active projects with $153.2 million in current year spend and $463.8 million in cumulative spend. Five projects (Evergreen extension, Pattullo Bridge rehabilitation, Metrotown station upgrade and 2015 and 2016 conventional bus replacement programs) account for $97.0 million of the expenditures. A comparison of project budgets against forecasted final cost over the 79 active projects shows a favourable forecasted variance of $22.5 million (2.1 per cent). Significant capital spending by category for 2016 is highlighted as follows: Revenue Vehicles: $63.3 million to September 30; $47.6 million is directly related to the 2015 and 2016 conventional bus replacement programs. Infrastructure: $57.0 million to September 30. There are three Expo Line stations currently undergoing major renovations, Metrotown, Commercial Broadway and Joyce-Collingwood. The expectation is that these renovations will enhance service by increasing system capacity and improving customers’ experience post completion. This category also includes the Pattullo Bridge long term rehabilitation project. Major Construction: $22.5 million to September 30, driven by the Evergreen Extension. This is the next major expansion of the rail network and is expected to increase ridership and accessibility to the transit system when it is fully operational. The project is a partnership with the Province, via the BC Transportation Financing Authority, with both parties contributing to the construction of the extension. Once completed, TransLink will receive specific assets for its contributions to the project and be responsible for maintaining and operating the extension. Approved in Principle (AIP) Capital Projects As of September 30, 2016 there are 22 AIP projects that have not yet been initiated with a total AIP aggregate budget of $174.3 million. AIP projects include enterprise wide investment in continued fleet and equipment replacements, infrastructure upgrades and information technology systems improvements. The significant 2016 projects pending approval are:

• 2017 Conventional Bus Replacement Program ($92.7 million) • Surrey Central SkyTrain Station Upgrades ($17.6 million) • 2016 Conventional Bus Replacement Program (Phase 2, $16.2 million) • Automatic Train Control Equipment Replacement ($12.4 million) • Seismic Upgrade South SeaBus and Skywalk ($6.0 million)

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Substantially Complete Capital Projects A total of 63 projects with an aggregate current budget of $1.2 billion and a total forecasted cost of $1.2 billion are currently deemed substantially complete and in the final stages of project activity with $33.8 million in forecasted costs remaining. The total expected favourable variance for these projects at completion is $16.4 million (1.4 per cent). A large number of substantially complete projects remain open due to an extended warranty period on acquired components, as is the case with buses or SkyTrain car replacements. In addition to several bus and SkyTrain fleet projects, this category also includes Hamilton Transit Centre, Compass, Main Street and New Westminster SkyTrain Station Upgrades, the Golden Ears Bridge and a variety of other projects. The construction of the new Hamilton Transit Centre (HTC) in Richmond achieved substantial completion in September of this year and operations have begun at the new facility. HTC replaces two of the aging transit centres in the region and further centralizes bus operations. Closed Capital Projects As of September 30, 2016, 19 projects with a final cost of $64.8 million and an approved budget of $71.0 million were completed and closed in the year. The closed projects include:

• West Coast Express Fleet and Facility Expansion • SkyTrain Automatic Train Control System Upgrades • Pattullo Bridge short term rehabilitation • Trolley Overhead replacements • Rail Equipment replacements and • Transit Centre equipment replacements.

Cancelled Capital Projects For the first nine months of 2016, six AIP projects with an aggregate budget of $7.6 million were cancelled, with little to no customer or service impacts. These projects were reviewed, prioritized, and cancelled to proactively manage costs, align strategic priorities, and optimally utilize limited resources using a risk based approach. Capital Infrastructure Contributions These expenditures consist of contributions to municipalities for the rehabilitation and upgrade of the Major Road Network and bike pathways. As TransLink does not own the underlying assets the costs are expensed in the year. As of September 30, 2016 there were 14 active programs with $18.2 million in expenditures this year-to-date.

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5. Changes in Financial Position

Financial Assets Cash and cash equivalents increase of $19.5 million is due to operating and capital expenditures (net of cash inflows and changes in investment balances) made during the first nine months of 2016. Restricted cash and investments represent both unspent Government Transfers and self-administered sinking funds. The decrease of $68.4 million is primarily due to the spending of government transfers and an increase of $29.8 million in self-administered sinking funds.

Consolidated Statement of Financial PositionSeptember 30 December 31

($ thousands) 2016 2015 Change

Cash 269,038 249,527 19,511 Accounts Receivable 112,921 102,421 10,500 Restricted cash and investments 371,389 439,770 (68,381) Investments 109,769 83,573 26,196 Debt reserve deposits 37,091 36,407 684

Financial Assets 900,208 911,698 (11,490)

Accounts payable and accrued liabil ities 234,134 241,766 (7,632) Debt 2,073,405 2,144,102 (70,697) Deferred government transfers 988,284 1,124,066 (135,782) Golden Ears Bridge contractor l iabil ity 1,049,636 1,050,913 (1,277) Deferred concessionaire credits 554,925 572,396 (17,471) Employee future benefits 118,388 110,023 8,365 Deferred revenue and deposits 120,380 14,742 105,638 Deferred lease inducements 12,634 12,799 (165)

Liabil ities 5,151,786 5,270,807 (119,021)

Net Debt (4,251,578) (4,359,109) 107,531

Tangible Capital Assets 4,655,926 4,606,623 49,303 Supplies Inventory 56,705 56,442 263 Prepaid Expenses 16,417 11,719 4,698

Non-Financial Assets 4,729,048 4,674,784 54,264


Page 25

Liabilities Debt is discussed in the "Liquidity and Capital Resources" section. Deferred government transfers represent the receipt of capital funding offset by revenue recognized as the related stipulations in the various government funding agreements are met. During the first nine months of 2016, the decrease of $135.8 million was due to $139.5 million of revenue being recognized offset by $3.7 million of interest earned on unspent government transfers and government transfers received. Deferred concessionaire credits represent the funding provided by the Canada Line Concessionaire. This balance is amortized to income on a straight-line basis over the operating term of the concessionaire agreement, which will expire in July 2040. The increase in employee future benefits, which represent post-retirement and post-employment benefits, is due to the annual estimated current service cost and related interest. The post retirement portion of this liability will draw down upon retirement of the employees. The increase in deferred revenue and deposits of $105.6 million is mainly due to unearned property tax revenue (i.e. October to December 2016). Non-Financial Assets Tangible capital assets have increased by $49.3 million in the first nine months primarily as a net result of $180.4 million in additions offset by amortization expense of $131.1 million. Asset additions consist primarily of work in progress on the Evergreen Extension and the new Hamilton Transit Centre.

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6. Liquidity and Capital Resources

Cash Flows and Liquidity Unrestricted cash and cash equivalents declined as operating and capital expenditures were made during the first nine months of 2016. The following table shows TransLink’s unrestricted cash and cash equivalents.

TransLink’s liquidity position is further supported by a $500 million commercial paper program, of which only $90 million is outstanding at quarter end. TransLink also holds unrestricted investments. Restricted cash and investments include unspent government transfers, which are used to fund qualifying capital expenditures.

UNRESTRICTED CASH AND CASH EQUIVALENTSSeptember 30 December 31


Cash and cash equivalents1 269,038 249,527 19,511 1 Reclassified to include Money Market Mutual Funds

RESTRICTED CASH AND INVESTMENTS September 30 December 31


Unspent government transfers 222,377 322,009 (99,632)Self administered sinking funds 149,012 117,761 31,251 Total Restricted cash and investments 371,389 439,770 (68,381)

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Debt TransLink’s debt management policy includes self-imposed debt coverage and debt service coverage limits. TransLink continues to remain within these limits. TransLink finances its assets using three main sources: net direct debt, indirect P3 debt and senior government contributions. The latter is represented on the balance sheet as deferred government transfers. Net direct debt and Indirect P3 debt has increased due to seasonal cash flows, and indirect P3 debt has decreased due to amortization of deferred concessionaire credits. Deferred government transfers declined due to capital spending activity.

Maintaining a high-quality credit rating is essential to ensure that TransLink can continue to access capital markets in the most cost-effective basis. The following table summarizes TransLink’s current credit ratings and outlooks.

FINANCINGSeptember 30 December 31


Debt 2,073,405 2,144,102 (70,697)

Less: Self-administered sinking funds (149,012) (117,761) (31,251) Less: Debt reserve deposits (37,091) (36,407) (684) Net Direct Debt 1,887,302 42.1% 1,989,934 42.0% (102,632)

Golden Ears Bridge contractor l iabil ity 1,049,636 1,050,913 (1,277) Deferred concessionaire credits 554,925 572,396 (17,471) Indirect P3 Debt 1,604,561 35.8% 1,623,309 34.3% (18,748)

Subtotal Net Direct Debt and Indirect P3 Debt 3,491,863 3,613,243 (121,380)

Deferred government transfers 988,284 22.1% 1,124,066 23.7% (135,782)

Total Financing 4,480,147 100.0% 4,737,309 100.0% (257,162)

CREDIT RATINGAs at September 30, 2016AgencyDBRS R-1 mid AA AA StableMoody's Not Rated Aa2 Aa2 Stable

Commercia l Paper Senior Debt

Genera l Obl igation Outlook

Page 28

Appendix I – Consolidated Financial Statements The following statements are presented in accordance with generally accepted Canadian accounting principles for local governments, as recommended by the Public Sector Accounting Board of the Chartered Professional Accountants of Canada. Consolidated Statement of Financial Position

SOUTH COAST BRITISH COLUMBIA TRANSPORTATION AUTHORITYConsolidated Statement of Financial Position(in thousands of dollars)

September 30, 2016, with comparative information for December 31, 2015

September 30 December 312016 2015

FINANCIAL ASSETSCash and cash equivalents 269,038$ 249,527$ Accounts receivable 112,921 102,421 Restricted cash and investments 371,389 439,770 Investments 109,769 83,573 Debt reserve deposits 37,091 36,407

900,208 911,698

LIABILITIESAccounts payable and accrued liabilities 234,134 241,766 Debt 2,073,405 2,144,102 Deferred government transfer 988,284 1,124,066 Golden Ears Bridge contractor liability 1,049,636 1,050,913 Deferred concessionaire credit 554,925 572,396 Employee future benefits 118,388 110,023 Deferred revenue and deposits 120,380 14,742 Deferred lease inducements 12,634 12,799

5,151,786 5,270,807

NET DEBT (4,251,578) (4,359,109)

NON-FINANCIAL ASSETS

Tangible capital assets 4,655,926 4,606,623 Supplies inventory 56,705 56,442 Prepaid expenses 16,417 11,719

4,729,048 4,674,784

Accumulated Surplus 477,470$ 315,675$

Page 29


SOUTH COAST BRITISH COLUMBIA TRANSPORTATION AUTHORITYConsolidated Statement of Operations(in thousands of dollars)

Nine months ended September 30, 2016, with comparative information for September 30, 2015

2016 2016 2015Budget Actual Actual

Revenue:Taxation 588,176$ 613,505$ 577,329$ Transit 378,187 402,855 381,090 Golden Ears Bridge toll ing 37,745 40,199 36,564 Government transfers 173,464 154,684 154,837 Amortization of deferred concessionaire credit 17,407 17,471 17,407 Interest income 27,176 30,207 25,323 Miscellaneous revenue 2,664 4,463 4,662 Gain on disposal of tangible capital assets - 68 2,366

1,224,819 1,263,452 1,199,578Expenses:

Bus division 585,405 585,125 574,158 Corporate 108,157 99,800 76,572 Rail division 266,607 269,130 264,441 Roads & Bridges 138,074 122,780 112,697 Transit Police 25,516 24,822 24,196

1,123,759 1,101,657 1,052,064

Surplus for the period 101,060 161,795 147,514

Accumulated surplus, beginning of period 186,004 315,675 153,313

Accumulated surplus, end of period 287,064$ 477,470$ 300,827$

Page 30


SOUTH COAST BRITISH COLUMBIA TRANSPORTATION AUTHORITYConsolidated Statement of Changes in Net Debt(in thousands of dollars)


2016 2015Actual Actual

Surplus for the period 161,795$ 147,514$

Acquisition of tangible capital assets (180,615) (166,998) Amortization of tangible capital assets 131,121 121,277 Gain on disposal of tangible capital assets (68) (2,366) Net proceeds from disposal of capital assets 259 2,410

(49,303) (45,677)

Change in supplies inventory (263) (5,093) Change in prepaid expenses (4,698) (3,638)

(4,961) (8,731)

Decrease in net debt 107,531 93,106

Net debt, beginning of period (4,359,109) (4,422,461)

Net debt, end of period (4,251,578)$ (4,329,355)$

Page 31


SOUTH COAST BRITISH COLUMBIA TRANSPORTATION AUTHORITYConsolidated Statement of Cash Flows(in thousands of dollars)


2016 2015Restated

Cash provided by (used for):

Operating Transactions:Surplus for the period 161,795$ 147,514$ Non-cash charges to operations (25,321) (36,588) Net proceeds from disposal of assets held for sale - 4,868 Changes in non-cash operating working capital 90,910 91,780 Net change in cash from operating transactions 227,384 207,574

Capital Transactions:Purchase of capital assets (180,615) (166,998) Net proceeds from disposal of capital assets 259 2,410

Net change in cash from capital transactions (180,356) (164,588)

Investing Transactions:Decrease (increase) in restricted cash and investments 68,381 (101,018) Increase in investments (26,196) (2,822) Increase in debt reserve deposits (684) (191)

Net change in cash from investing transactions 41,501 (104,031)

Financing Transactions:Debt proceeds 824 30,471 Issue costs on financing - (21) Repayments of debt (72,233) (41,424) Repayments of Golden Ears Bridge contractor l iabil ity (1,277) (216) Government transfers received for capital additions 3,668 125,887

Net change in cash from financing transactions (69,018) 114,697

Increase in cash 19,511 53,652

Cash, beginning of period 249,527 228,735

Cash, end of period 269,038$ 282,387$

Supplementary information:Interest paid 112,371$ 110,549$

Page 32

SOUTH COAST BRITISH COLUMBIA TRANSPORTATION AUTHORITYConsolidated Statement of Cash Flows (continued)(in thousands of dollars)


2016 2015Restated

Non-cash charges to operations:Amortization of capital assets 131,121$ 121,277$ Amortization of bond discount 563 897 Amortization of debt issue cost 149 158 Amortization of deferred concessionaire credit (17,471) (17,407) Amortization of deferred government transfers (139,450) (138,980) Amortization of deferred lease inducements (165) (167) Gain on disposal of tangible capital assets (68) (2,366)

(25,321)$ (36,588)$

Changes in non-cash operating working capital:(Increase) decrease in accounts receivable (10,500)$ 6,876$ Increase in supplies inventory (263) (5,093) Increase in prepaid expenses (4,698) (3,638) Decrease in accounts payable and accrued liabil ities (7,632) (1,586) Increase in deferred revenue and deposits 105,638 88,006 Employee future benefit payable 8,365 7,215

90,910$ 91,780$

Page 33

Segment Report

South Coast British Columbia Transportation AuthoritySegment ReportNine months ended September 30, 2016(in thousands of dollars)

Bus Rail Roads & Transitdivision Corporate division Bridges Police Total 2015

RevenuesTaxation -$ 613,505$ -$ -$ -$ 613,505$ 577,329$ Transit 3 402,852 - - - 402,855 381,090 Golden Ears Bridge tolling - - - 40,199 - 40,199 36,564 Government transfers - 154,684 - - - 154,684 154,837 Amortization of deferred concessionaire credit - - 17,471 - - 17,471 17,407 Interest income - 30,207 - - - 30,207 25,323 Miscellaneous revenue 1,925 1,961 455 - 122 4,463 4,662 Gain (loss) on disposal of tangible capital assets 259 - (191) - - 68 2,366

2,187 1,203,209 17,735 40,199 122 1,263,452 1,199,578 Expenses

Administration 12,381 18,700 4,129 45 1,626 36,881 27,609 Capital infrastructure contributions - - - 13,628 - 13,628 9,360 Contracted services 51,556 9,044 88,876 9,405 - 158,881 150,512 Fuel and power 31,950 - 9,565 - - 41,515 48,690 Insurance 10,805 130 3,127 797 29 14,888 14,607 Maintenance, materials and utilities 45,427 1,793 26,630 19,427 771 94,048 85,320 Professional & legal 1,568 16,907 1,845 5,100 252 25,672 14,813 Rentals, leases and property tax 9,394 5,899 1,389 60 1,420 18,162 30,021 Salaries, wages and benefits 325,712 29,752 61,324 890 20,642 438,320 424,322

Expenses before amortization and interest 488,793 82,225 196,885 49,352 24,740 841,995 805,254

Amortization of tangible capital assets 60,235 10,988 45,176 14,671 51 131,121 121,277 Interest 36,097 6,587 27,069 58,757 31 128,541 125,533 Amortization and interest 96,332 17,575 72,245 73,428 82 259,662 246,810

Total Expenses 585,125 99,800 269,130 122,780 24,822 1,101,657 1,052,064

Surplus (deficit) for the period (582,938)$ 1,103,409$ (251,395)$ (82,581)$ (24,700)$ 161,795$ 147,514$

2016

Page 34

Appendix II – Allocated Costs between Divisions

Note: Human Resources costs are allocated based on headcounts, while Business Technology costs are allocated based on operating usage.

Allocated Cost BreakdownYTD YTD YTD

Nine months ending September 30 2015 2016 2016 Budget Variance($ thousands) ACTUAL ACTUAL Fav/(Unfav) % BUDGET Fav/(Unfav) %

Shared ServicesBus Division 17,593 18,054 461 2.6% 19,689 (1,635) (8.3%)Access Transit 698 503 (195) (27.9%) 528 (25) (4.7%)SkyTrain - Expo & Millenium Line 660 773 113 17.1% 814 (41) (5.0%)West Coast Express 55 49 (6) (10.9%) 52 (3) (5.8%)Evergreen Line - 360 360 0.0% - 360 0.0%Transit Police 1,264 1,131 (133) (10.5%) 1,222 (91) (7.4%)Roads & Bridges 1,507 5,947 4,440 294.6% 6,723 (776) (11.5%)Corporate (21,777) (26,817) (5,040) 23.1% (29,028) 2,211 (7.6%)

Total Shared Services allocated - - - - - - -

Costs Administered by TransLink and allocated to subsidiariesBus Division 11,553 14,522 2,969 25.7% 13,302 1,220 9.2%SkyTrain - Expo & Millenium Line 2,905 3,619 714 24.6% 3,138 481 15.3%SkyTrain - Canada Line 1,510 1,981 471 31.2% 1,676 305 18.2%West Coast Express 11,770 434 (11,336) (96.3%) 2,599 (2,165) (83.3%)Transit Police 1,339 1,371 32 2.4% 1,508 (137) (9.1%)

Total Costs Administered by TransLink allocated 29,077 21,927 (7,150) (24.6%) 22,223 (296) (1.3%)

Bus Division 29,146 32,576 3,430 11.8% 32,991 (415) (1.3%)Access Transit 698 503 (195) (27.9%) 528 (25) (4.7%)SkyTrain - Expo & Millenium Line 3,565 4,392 827 23.2% 3,952 440 11.1%SkyTrain - Canada Line 1,510 1,981 471 31.2% 1,676 305 18.2%West Coast Express 11,825 483 (11,342) (95.9%) 2,651 (2,168) (81.8%)Evergreen Line - 360 360 0.0% - 360 0.0%Transit Police 2,603 2,502 (101) (3.9%) 2,730 (228) (8.4%)

Total costs allocated to Subsidiaries from TransLink 49,347 42,797 (6,550) (13.3%) 44,528 (1,731) (3.9%)

ACTUAL TO BUDGET

Change

YEAR OVER YEAR

Page 35

Appendix III – KPI’s


Nine months ending September 30 ACTUAL ACTUAL BUDGET Fav/(Unfav) %

Service Performance ItemsSafety: Customer Injuries (per 1 million boarded passengers)

CMBC 4.3 4.5 n/aExpo & Millenium Lines 1.4 1.1 1.1 - - West Coast Express 1 0.5 0.5 0.3 (0.2) (66.7%)HandyDART 13.0 7.7 10.8 3.1 28.7%

Safety: Employee Lost Time FrequencyCMBC (per 200,000 Hours Worked) 6.7 8.7 7.0 (1.7) (24.3%)Expo & Millenium Lines (per 200,000 Hours Worked) 4.1 3.2 3.2 - - West Coast Express (per 200,000 Hours Worked) - - - - - HandyDART (per 200,000 Hours Worked) 15.4 16.5 14.9 (1.6) (10.7%)

Safety: CMBC Operator Assaults (per 1 Million Service Hours) 22.0 19.8 n/a

Ridership: Boarded Passengers (Thousands)CMBC 2 186,780 184,852 175,897 8,955 5.1%Expo & Millenium Lines 2 57,167 70,942 57,916 13,026 22.5%Canada Line 30,568 32,889 31,483 1,406 4.5%West Coast Express 1,986 1,858 2,394 (536) (22.4%)HandyDART 1,002 1,043 1,015 28 2.8%

Ridership: (Thousands)Overall System (Revenue Passengers) 175,854 n/a 177,287 Overall System (Journeys) 3 n/a 175,210 n/a

Vehicle Service Delivery: Percentage of Service Hours DeliveredCMBC 99.7% 99.6% 100.0% (0.4%) (0.4%)Expo & Millenium Lines 99.5% 99.6% 99.8% (0.2%) (0.2%)Canada Line 99.5% 100.0% 100.0% - - West Coast Express 99.6% 100.0% 100.0% - - HandyDART 99.6% 99.6% n/a

Vehicle Punctuality: On-Time PerformanceCMBC (< 2 Minutes Late) 81.7% 81.8% 84.0% (2.2%) (2.6%)Expo & Millennium Lines (headway + 3 minutes) 96.1% 95.4% 95.3% 0.1% 0.1%West Coast Express (headway + 5 minutes) 95.3% 97.0% 97.8% (0.8%) (0.8%)HandyDART (within 15 minutes of Scheduled Pick-Up Time) 89.9% 88.8% 90.0% (1.2%) (1.3%)

Vehicle Reliability: Mean Distance Between FailureCMBC 24,900 28,268 25,196 3,072 12.2%Expo & Millenium Lines 451,651 450,129 466,071 (15,942) (3.4%)West Coast Express 257,172 519,391 231,377 288,014 124.5%

Budget Variance

ACTUAL TO BUDGET

Page 36


Nine months ending September 30 ACTUAL ACTUAL BUDGET Fav/(Unfav) %

HandyDart Vehicle ProductivityTrips per Service Hour (excludes Taxis) 2.0 2.0 2.0 - - Trip Denials 952 1,458 1,122 (336) (29.9%)

EnvironmentalCMBC (Spills per 1 Million Km) 8.5 7.1 8.5 1.4 16.5%CMBC (Revenue Vehicle Energy Consumption in Gigajoules) 1,368,675 1,381,619 1,398,621 17,002 1.2%

Customer Service: Customer Satisfaction (overall score of 10)Overall System 4 7.5 7.6 7.6 - - CMBC 7.7 7.9 7.6 0.3 3.9%Expo & Millennium Lines 7.9 8.1 8.0 0.1 1.3%Canada Line 8.6 8.5 8.7 (0.2) (2.3%)West Coast Express 8.1 8.6 8.5 0.1 1.2%

Customer Service: Customer ComplaintsOverall System ( per 1 million boarded passengers) 4,5 93.1 88.7 90.9 2.2 2.4%CMBC (per 1 million boarded passengers) 110.8 115.8 112.2 (3.6) (3.2%)Expo & Millennium Lines (per 1 million boarded passengers) 35.1 15.2 30.0 14.8 49.3%Canada Line (per 1 million boarded passengers) 8.8 4.0 9.0 5.0 55.6%West Coast Express (per 1 million boarded passengers) 359.2 153.4 173.5 20.1 11.6%HandyDART (operator complaints as a % of trips) 0.03% 0.05% 0.04% (0.01%) (25.0%)HandyDART (service complaints as a % of trips) 0.07% 0.07% 0.07% - -

Financial: Operating CostsOverall System (operating cost per capacity km) 1,4,6 $0.083 $0.086 $0.086 - - CMBC (operating cost per capacity km) $0.118 $0.122 $0.122 - - Expo & Millenium Lines (operating cost per capacity km) $0.028 $0.031 $0.031 - - Canada Line (operating cost per capacity km) $0.104 $0.106 $0.105 (0.001) (1.0%)West Coast Express (operating cost per capacity km) $0.097 $0.091 $0.097 0.006 6.2%HandyDART (operating cost per trip) $41.31 $39.69 $41.10 1.41 3.4%

Financial: Operating Cost RecoveryTransLink (conventional system) 1,7 53.6% 53.7% 49.4% 4.3% 8.7%

1 YTD 2015 figures have been restated2 The preliminary YTD 2015 boarded passengers were restated at the end of 2015 to reflect final boarded passenger numbers3 Journeys have replaced revenue passengers as the new ridershp methodology, therefore comparative historic and budget figures are not available4 Excludes HandyDART5 Includes Bus, SeaBus, Expo & Millennium Line, Canada Line, West Coast Express and Corporate complaints6 Includes Bus, SeaBus, Expo & Millennium Line, Canada Line, West Coast Express and Police operating costs7 Cost Recovery Ratio excludes depreciation and interest expense

ACTUAL TO BUDGET

Budget Variance

TO: Risk and Capital Committee

FROM: Sany Zein, Acting Vice President, Infrastructure Management and Engineering


SUBJECT: Rapid Transit Projects Update PURPOSE This report provides an update on project development activities for the South of Fraser Rapid Transit and Millennium Line Broadway Extension projects. BACKGROUND The Mayors’ Council on Regional Transportation approved the Regional Transportation Investment: A Vision for Metro Vancouver (“the Vision”) document in June 2014 and reconfirmed support for this Vision in July 2015 following the plebiscite outcome. TransLink continues to advance planning and technical work required to better define the major investments identified in this Vision, including rapid transit expansion projects South of Fraser and along the Broadway corridor. In August 2015, the Board approved continuing planning and project definition work consistent with the Vision to help secure senior government funding. Both the South of Fraser Rapid Transit and Millennium Line Broadway Extension (MLBE) Projects have been screened-in by P3 Canada for consideration of Federal funding. TransLink staff provides regular updates to representatives of the provincial and federal governments. DISCUSSION As per the Vision, the Millennium Line Broadway Extension (MLBE) project will extend the Millennium Line for approximately 6 kilometres from VCC to Arbutus, in a tunnel below Broadway with 6 new stations. The first stage of the South of Fraser Rapid Transit project connects Surrey Centre with Newton and Guildford (SNG). The project extends for approximately 10 kilometres mainly along 104th Avenue and King George Boulevard, with 11 stops. A future second stage of the South of Fraser Rapid Transit project will extend along Fraser Highway from Surrey Centre to Langley, a distance of approximately 17 kilometres. The two stages are being planned in an integrated manner, with the current implementation focus on the first stage. The March 2016 federal budget announced a New Public Transit Infrastructure Fund (PTIF) to be released in two phases. Phase 1 identifies $370M for Metro Vancouver to be matched 50% for a total of $740M. The parameters and timelines for the second phase Federal New Public Transit Fund are still in development. TransLink prepared the draft rapid transit project business cases to inform future senior government budget and funding decisions as well as TransLink’s next Investment Plan. To meet the requirements of provincial and federal business cases, the following tasks are progressing in close collaboration with the municipalities, the Ministry of Transportation and Infrastructure, the Ministry of Community Sport and Cultural Development and Partnerships BC:

Rapid Transit Projects Update November 22, 2016 Page 2 of 3

• Draft Business Case Preparation (completed in October 2016) • Value Analysis to further refine costs and benefits (see Value Analysis section below) • Technical studies and reference case design • Demand forecasting and modelling to quantify project benefits • Project benefit and cost estimation • Preliminary environmental assessments and stakeholder engagement • Financial and procurement options analysis • Public Engagement (see Public Engagement section below)

Management has convened a Project Board for each of the projects with representation from the executive levels of the Ministry of Transportation and Infrastructure, Ministry of Community Sport and Cultural Development, Partnerships BC, and the respective municipalities for each project. The Project Boards provide oversight to the staff and consultant teams developing the projects, and provide advice on the next steps in the draft business cases. PTIF Phase 1 includes funding to advance both projects to a state of procurement readiness. This includes developing draft procurement documents, project agreements, developing agreements with municipalities, funding partners and third parties, and assessing environmental and socio-economic impacts of the projects. Management is developing detailed schedules and work plans for this work. Management is tracking schedules and work programs in order to adjust as needed for federal programs, once announced. The overall project schedules for procurement and construction are being developed in consultation with the Province and TransLink. Value Analysis The project partners have initiated Value Analysis initiatives to benefit from independent expertise on similar rapid transit projects and review key components of the Draft Business Cases. The objectives of the Value Analysis are to independently review project assumptions to date, to ensure that experience and lessons learned from other similar projects have been considered. The Value Analysis for the Millennium Line Broadway Extension project will focus on tunnel project challenges. The Value Analysis for the Surrey Newton-Guildford project will focus on LRT community integration aspects. The Value Analysis initiatives are scheduled to report finding to the Project Boards in January 2017, and the findings will inform future updates of the Draft Business Cases. Public Engagement As part of the Procurement Readiness process, public engagement and consultation is scheduled for both projects in three stages: Stage 1: Re-engage, scheduled for December 2016 and January 2017.

Rapid Transit Projects Update November 22, 2016 Page 3 of 3

Stage 2: Consult, scheduled for Spring / Summer 2017; and, Stage 3: Inform, scheduled for Fall 2017. The public engagement activities are being planned in consultation with the project partners and the Project Boards. In December 2016, stakeholder meetings will be held to re-introduce the projects. In January 2017, public engagement (likely to include Open Houses and on-line information) will be held to more broadly re-engage with the public on both projects. CUSTOMER IMPACTS None at this time. RISK ASSESSMENT While efforts are underway to confirm senior government funding and identify a regional funding source, the lack of fully-committed project funding remains the most significant risk to schedules and cost estimates developed for project business cases. Delays in securing funding will likely increase project costs due to inflationary pressures on labour, materials and properties. Delays in securing project funding may also increase the risk of obsolescence in some of the procurement readiness outcomes. The benefits of the two expansion projects South of the Fraser and along Broadway can only be realized if the existing rapid transit network is also upgraded to accommodate increased ridership demand. This is referred to in the Vision as the Expo Line Upgrade Strategy and related upgrades on the Millennium and Canada Lines. It is essential that these upgrades are funded and proceed along with the expansion projects. This risk is being managed through the TransLink 10 Year Investment Plan and Funding Strategy. COMMUNICATION IMPLICATIONS As described above, TransLink in partnership with each respective project municipality will be re-engaging with key stakeholders through meetings in December 2016 to provide information on project status, schedule and future engagement plans. Public engagement through open houses and on-line information is planned in early 2017 to advance project planning. CONCLUSION TransLink is advancing the planning and engineering work for the rapid transit expansion projects in the South of Fraser and along the Broadway corridor in Vancouver. Work plans are being developed to bring the projects ready for procurement. This work will be funded by Phase 1 of the Public Transit Infrastructure Fund.

TO: Risk and Capital Committee

FROM: Sany Zein, Acting Vice President, Infrastructure Management & Engineering DATE: November 22, 2016

SUBJECT: Pattullo Bridge Condition Monitoring Report PURPOSE This report provides an information update on the on-going condition monitoring activities that have occurred on the Pattullo Bridge since the September 2016 update. BACKGROUND The Pattullo Bridge is 79 years old. Most of the structural components have passed the predicted design life and are reaching the end of their useful life. The deterioration of the bridge condition is a dynamic event, with conditions generally degrading over time. Weather, temperature fluctuation, rainfall, wind, river action, live traffic loads and aging of the steel and concrete components all contribute to the degradation of the bridge condition. To ensure all appropriate inspection and monitoring activities are being identified and implemented, TransLink regularly consults with experienced bridge engineers working in the private and public sector in Metro Vancouver. With responsibility for the safety and operations of the bridge, TransLink monitors the condition of the bridge structure closely through regular inspections of the bridge components. TransLink then performs maintenance and repairs in response to the findings of the inspection reports. DISCUSSION The September 2016 Board reports contained a detailed historical chronology of inspection and monitoring activities. Recent and on-going inspection activities since September 2016, are listed in Table 1. Table 1: September to November 2016 Pattullo Bridge Ongoing Inspections and Monitoring

ITEM REFERENCE ACTIVITY CONSULTANTS / PARTNERS DATE

1 Condition Inspection Ministry of Transportation and Infrastructure In Progress

2 Railing Inspection and Repairs COWI North America (former Buckland & Taylor) In Progress

3 Wind and Seismic Warning Systems Assessment; Emergency Management Plan Parsons Corporation In Progress

4 Deck Condition Monitoring WSP (former Levelton Consultants Ltd) In Progress

5 Removal of Abandoned Water Mains Metro Vancouver In Progress

Pattullo Bridge Condition Monitoring Report November 22, 2016 Page 2 of 4 A summary of each of these activities is provided as follows: 1. Condition Inspection Each year, the BC Ministry of Transportation and Infrastructure (Ministry) performs a condition inspection of the Pattullo Bridge with the aid of a ‘snooper truck’. Since Bridge closures were required to complete the 2016 deck rehabilitation work, the 2016 bridge condition inspection was coordinated to take place during the evenings of August 24 and August 25. A Condition Inspection Report documenting the findings of the inspection is expected at the end of Q4 2016. 2. Railing Inspection In Q3 2016, TransLink retained COWI to re-inspect the railings on the Bridge. The findings of the inspection were documented in the Pattullo Bridge Railing Inspection report. Based on the inspection, 43 of 606 railing posts are currently considered a high priority for repair/replacement. The inspection also found that 69 posts require connection type repairs, such as:

• Replacement of missing bolts and/or nuts; • Repairing welds a locations where existing welds have fracture; or, • Placing washers under bolt heads at locations where the bolt hole is oversized relative to the

bolt size. These railing repairs and replacements are currently being conducted by Mainroad Contracting Ltd as the weather permits and are scheduled to continue through to Q1 2017. As the railings will continue to deteriorate over the remaining service life of the Bridge, TransLink will continue to monitor and repair/replace the railing posts as needed. 3. Wind and Seismic Warning Systems and Emergency Management Plan The Pattullo Bridge was not designed to meet current wind and seismic loading standards for a new structure built today, and as a result, may be vulnerable in terms of withstanding a seismic or high-wind event. To improve the safety of the Bridge, a feasibility study to determine if advance warning and monitoring systems can be implemented is being conducted. The scope of work also includes developing an emergency management plan, which identifies protocols to close the bridge ahead of impending wind and seismic events if warranted. A wind warning system would monitor upcoming wind storms and measure wind speeds at the bridge. A seismic warning system would sense an earthquake in progress but prior to the damaging ground waves reaching the bridge. Both systems may provide opportunities to reduce risks to bridge users through warnings and closures. The study began in Q3 2016 with Parsons identifying existing infrastructure with respect to traffic, seismic warning, and wind monitor systems near the Pattullo Bridge, and undertaking current practices and technologies review. Based on the findings of the initial project tasks, Parsons is continuing work to identify potential options for seismic and wind warning systems. Opportunities to use existing infrastructure or make use of systems currently in place for other agencies will be considered in addition to new technologies. Factors that will influence the selection of options include effectiveness, constructability, costs, reliability, and impacts to motorist, pedestrian, and cyclist safety. The development of options will continue through Q4 2016 and Q1 2017.

Pattullo Bridge Condition Monitoring Report November 22, 2016 Page 3 of 4

4. Deck Condition Monitoring and Repairs The reinforced concrete deck of the Pattullo Bridge has been in an active and advanced state of deterioration, primarily due to corrosion of the reinforcing steel. In addition to the top surface deterioration, extensive corrosion-related damage is also occurring to the bottom surface (soffit) of the deck. Experts from WSP have been involved in monitoring the condition and overseeing repairs to the Pattullo Bridge deck. WSP have been involved the following:

• In Q3 2016, while the Bridge was made accessible by access platforms erected for the Deck Rehabilitation Project, WSP inspected the underside of the deck to determine where delaminations coincide with the top surface repairs. Where appropriate and feasible, full-depth repairs were undertaken between Pier 0 and Pier 9 as part of the Deck Rehabilitation Project. The work was completed in the beginning of Q4 2016. Where repairs were not feasible (in areas beneath the traffic barriers and beneath lanes open to traffic), WSP recommends repair work to be considered from the deck soffit in the future. These repairs will be scheduled for completion during future bridge closures.

• To ensure that the deck is functional and safe for operations, since Q2 2015 WSP have been conducting walk-over inspections of the deck during nightly lane closures as well as from the ground and catwalk levels to inspect the underside of the deck at two-week intervals. These inspections were put on-hold during construction of the Pattullo Deck Rehabilitation Project. As the scope of the Rehabilitation Project was only to make repairs to the deck areas requiring most urgent attention, between Pier 0 and Pier 9, the risk of pothole formation still exists for the remainder of the Bridge. To continue mitigating these risks, WSP resumed their inspection services in Q4 2016. Field reports are being submitted to keep TransLink informed on the condition of newly formed potholes (size and severity). Mainroad acts expeditiously to perform needed repairs when potholes are noted.

• A deck crack inspection will be undertaken by WSP in late Q4 2016 between Pier 0 and Pier 9, the rehabilitated sections of the deck. The survey will reveal if cracks have occurred on the newly completed portions of the deck. The deck rehabilitation Contractor will be responsible for sealing all cracks in excess of 0.15mm.

5. Removal of Abandoned Water Mains Two un-serviced Metro Vancouver water mains were connected to the Pattullo Bridge. As deterioration of the water mains may result in damage or injury to the public and to property, TransLink requested that Metro Vancouver consider removing the un-serviced water mains during the rehabilitation project. The water main removal began in Q3 2016 and was completed in Q4 2016. The removal of the water mains was performed by making use of access platforms erected for the Pattullo Bridge Deck Rehabilitation Project. These access platforms are currently being disassembled and will be completely removed from the Bridge by the end of 2016. CONCLUSION TransLink will continue to closely monitor and inspect the condition of the Bridge, and maintain the Bridge accordingly.

TO: Risk and Capital Committee FROM: Sany Zein, Acting Vice President, Infrastructure Management and Engineering DATE: November 14, 2016 SUBJECT: Pattullo Bridge Replacement Project - Update PURPOSE The following is an update on the Pattullo Bridge Replacement Project. BACKGROUND The existing Pattullo Bridge is subject to a number of well-documented challenges. The rehabilitation of the bridge deck to extend the deck life by about seven years commenced in late April 2016, necessitating the closure of two traffic lanes for approximately 4 months. The rehabilitation project was substantially completed on August 29. Information from the rehabilitation design process revealed that the existing structure does not meet wind load design standards for a bridge built today, and that upgrading the bridge to withstand a 1:475 year seismic event (the guideline used for similar major bridges) is technically extremely challenging and may be financially prohibitive. Management does not consider the existing bridge as viable from a risk and financial management perspective beyond the 2023-2024 timeframe. It is therefore essential to continue advancing the Pattullo Bridge Replacement Project. This represents TransLink’s most urgent major infrastructure risk. The alternative would be to plan for the closure of this crossing by 2023-2024. DISCUSSION In September 2015, the TransLink Board of Directors instructed Management to prepare budgets for 2016 and onwards to include $20 million to undertake, in an expedited manner, all project development activities to be ready to issue procurement documents for the Pattullo Bridge Replacement Project, consistent with the replacement bridge described in the 2014 Mayors’ Council Vision; and to continue negotiating with the Federal and Provincial governments to secure up to two-thirds senior government funding for the Pattullo Bridge replacement project. A business case and funding request under the P3 Fund was transmitted to PPP Canada on March 31, 2016. Subsequently, Management was informed that, since the government change, the P3 Fund is being reviewed and no new projects are being added to the fund. Alternative federal funding mechanisms are being developed, including a potential Canada Infrastructure Bank. Management continues to explore potential federal funding sources for the bridge with TransLink’s Strategic Planning group, pursuing preliminary discussions with Infrastructure Canada regarding applicability of Canada Infrastructure Bank financial support. In the meantime, the project is seeking recovery of eligible funds relating to the development of the business case submission. The capital cost of the project is being updated as the procurement readiness work progresses, including the environmental assessement work scheduled for 2016/2017.

Pattullo Bridge Replacement Project - Update November 14, 2016 Page 2 of 2 The project will be undergoing a harmonised environmental assessment process involving the BC Environmental Assessment Office (EAO) and the Port of Vancouver (PoV). The project recently submitted a formal Project Description to BCEAO and was issued a Section 10 order on Nov 9, 2016, confirming the Project’s entry into the BCEAO review process. During a 2015 risk assessment, it was acknowledged that the risk of encountering a currently unknown archaeological site during construction poses a significant risk to TransLink. To address this risk, the project will be undertaking archaeological field investigations in high potential archeological areas commencing late Fall and extending through Spring 2017. The project team also continues engagement with First Nations to understand their interests in the project. The project team continues to work with municipal staff from Surrey and New Westminster to understand municipal approvals required to finalize municipal connections and community integration requirements. Discussions have been positive and agreement was reached in mid-March 2016 to sign a Memorandum of Understanding (MoU) outlining the basis for collaboration on the project. The MoU was executed by all three parties on May 19, 2016. The design of the municipal connections is progressing well and will continue throughout 2016. Based on inputs received on the recent rounds of public consultation as well as technical and financial considerations, the project team and municipal staff are working on finalising the preferred municipal road connections. Management will seek municipal council adoption of the connection by the end of 2016. Management continues to work with Ministry of Transportation and Infrastructure officials to define connections between the new bridge and Highway 17 (the South Fraser Perimeter Road) and specific Provincial Business Case requirements. In 2015, the Province committed one-third funding, subject to the submission and review of a business case and Provincial budgetary planning, and this commitment was reiterated in a 2016 Ministerial letter. Risk Assessment Management is maintaining a comprehensive risk matrix for this stage of the project. All project risks relevant to the project development phase are being actively managed. Technical risks include coordination of various disciplines involved in scope definition and environmental assessment. Process risks include schedule delays in obtaining municipal, utility, and third party agreements. From a broader perspective, TransLink’s key risk is securing funding certainty for the project. With the limited remaining life of the existing bridge, plans to close this crossing will need to be initiated if funding for the replacement bridge is not secured in time for procurement by Q3 2017. Communications Implications A 2nd round of public consultation was held between October 3 to 31, 2016 in which emphasis was on pedestrian and cycling connection options to the new bridge. A final consultation report will be posted on the TransLink website by the end of November. Further consultation is anticipated in early 2017 to receive comments on the Project Description and key areas of study in the Environmental Assessment process. CONCLUSION The project remains on schedule to achieve procurement-readiness by Q3 2017, subject to securing funding consistent with the Mayors’ Vision, and to open a new bridge by late 2022.

TO: Risk and Capital Committee FROM: Vivienne King, President and General Manager, BCRTC

Sany Zein, Acting Vice President, Infrastructure Management and Engineering DATE: November 22, 2016 SUBJECT: Evergreen Rapid Transit Project Update

PURPOSE This report provides a final update on the status of the Evergreen Extension project with focus on TransLink’s engineering and systems readiness commitments. The Evergreen Extension opens for revenue service on December 2 2016.

BACKGROUND The Evergreen Project is an 11-kilometre network extension in a combination of elevated, at-grade, and tunnelled track with six new stations in three municipalities. The Project is jointly funded by the Federal government ($417 million), the Provincial government ($583 million), and TransLink ($400 million). The project is being delivered through a series of contracts with third parties.

Twenty-eight new SkyTrain vehicles (seven trains consisting of four cars each) are being delivered under a contract with Bombardier. The Provincial Ministry of Transportation and Infrastructure (the Province) is responsible for delivery of the overall project. TransLink will operate and maintain the line, stations, and station area infrastructure upon completion.

DISCUSSION TransLink’s Evergreen Project responsibilities have focused on integration of monitoring and control systems into the existing railway; vehicle procurement; and, review of the statutory rights of way in place along the alignment.

Figure 1: Evergreen Project Alignment and Stations

Evergreen Rapid Transit Project Update November 22, 2016 Page 2 of 4 PROJECT UPDATE The Project achieved Substantial Completion on October 31 and operational responsibility has been transferred to TransLink for operational readiness testing and revenue service. As announced on November 7, passenger service starts on December 2 2016. Construction (Province Responsibility)

• Construction is substantially complete. Minor deficiencies are being addressed by the contractor (EGRT Construction). An accessibility audit was proactively conducted by Management in October to confirm that the stations meet the needs of passengers with accessibility challenges. The audit generally found that stations met or exceeded modern accessibility guidelines, and suggested a few relatively minor upgrades for consideration. These will be followed-up on by Management.

• Plazas: Civil work on all plazas is substantially complete. Bike lockers are installed. Work to install bus shelters and bus stop signs is progressing through November.

• EGRT and TransLink have completed all system testing. Remaining issues have been identified and are being addressed either with upgrades or operational procedures.

• New Vehicles: Six MKIII trains are now in service. Some software issues have been identified, and Management is working with Bombardier to resolve these issues. The seventh vehicle is being used to test software upgrades.

Upgrades and Replacements to Existing SkyTrain Systems (TransLink Responsibility) Of the 19 systems that need to be integrated into SkyTrain operations, TransLink is required to upgrade or replace six existing operating systems. All of the upgrades are complete and in service for the Evergreen Extension. Some integration issues that do not have passenger-facing outcomes will be addressed in the New Year. Evergreen Line Use Agreement (Province Responsibility) The Millennium Line “Line Use Agreement” was updated on October 31 allowing TransLink to operate and maintain the Extension segment. Management will work with the Province in 2017 to finalize and combine the Millennium and Expo Line “Line Use Agreements” into one consolidated document. Operational Readiness (TransLink Responsibility)

• BCRTC has hired 95 percent of the required staff and training is nearing completion. • Manuals and procedures have been updated to reflect changes due to the Evergreen Extension. • Trial Running is complete. • Operational Readiness activities such as staff training and emergency planning are under way. • A significant milestone was achieved on November 17, when the project Operational Readiness

certificate was issued by the British Columbia Safety Authority. Schedule BCRTC operational readiness is on schedule for Opening Day on December 2 2016. Budget TransLink is managing the project budget within approved capital and operating frameworks to ensure that TransLink’s contractual obligations are met and operational readiness is achieved.

Evergreen Rapid Transit Project Update November 22, 2016 Page 3 of 4 Rail and Bus Service Changes A rail service pattern change was successfully implemented on October 22nd to support the trial running of the Evergreen Extension. The Expo line now has two branches – one to King George, and another to Production Way. The Millennium Line now travels between VCC Clark Station and Lougheed Town Centre, continuing to the Evergreen Extension starting on December 2. Minor schedule modifications were subsequently implemented to improve transfer times. Some concerns have been heard from passengers about crowding on the new Millennium Line service; this service is being monitored through passenger counts to identify the need for future schedule modifications. The Evergreen Extension provides an opportunity to revise the bus network to better meet community needs and support the new rail service. The Evergreen Bus integration will improve access and connections to stations and station areas by reducing duplicative bus resources (e.g. 97 B-line) and re-investing into a revised local bus network. These network changes respond to community priorities by improving connections between local activity centres, expanding service in new and growing neighbourhoods, making routes more direct and legible; and increasing service frequency through the day. The revised bus network concept was initially identified through the Northeast Sector Area Transit Plan (2013-14) a multi-year planning process including engagement with municipal staff, stakeholders, elected officials and the public. These bus service changes will be implemented on December 19, a few weeks after the Evergreen Extension goes into service (to align with the calendar of bus route schedule changes). A plan to provide service to Evergreen Stations during the interim weeks has also been developed. Marketing and Communications Planning Management is working with project partners on events and activities leading up to the start of service. These include local charity events and an opening day launch event. The opening of the Evergreen Extension is an opportunity to introduce new riders to transit and to educate the general public on the expansion of the rapid transit network, the new alignment of SkyTrain, the transfer of current bus users onto rail, and the new bus/rail service connections. The Evergreen Extension represents a change for a large number of our customers, and new customers will start riding the system for the first time. We will use a variety of marketing and communications tactics to ensure customers have the right information for traveling on the system. A strategy has been developed to reach current transit customers with information regarding changes to bus routes and the SkyTrain system. Tactics include on-system and traditional advertising, outreach within the community, proactive media and social media communications, and leveraging our digital channels. Risk Management TransLink is a significant funder and will have responsibility for operations and maintenance of the Evergreen Project when the capital project is complete. There are risks associated with TransLink activities during the design and construction period. Management actively tracked and mitigated risks related to:

• Systems Integration • Staff Recruitment and Training • Operational Readiness

Evergreen Rapid Transit Project Update November 22, 2016 Page 4 of 4

• Safety Testing and Certification BCRTC’s Activation Manager and TransLink’s Activation Coordinator regularly update the risk registries and initiate the necessary mitigation actions. CONCLUSION The project is on-track. Construction, testing and trial running are substantially complete. Final testing activities and operational readiness are all progressing towards the announced service start date of December 2 2016. Management will subsequently prepare a lessons learned report in Q1 2017, to inform upcoming rapid transit projects.

TO: Risk and Capital Committee FROM: Vivienne King, President and General Manager BCRTC Sany Zein, Acting Vice President, Infrastructure Management and Engineering DATE: November 22, 2016 SUBJECT: Implementation of Recommendations from the 2014 SkyTrain Independent Review PURPOSE The purpose of this report is to provide an update regarding the implementation of recommendations from the 2014 SkyTrain Independent Review conducted by Gary McNeil. BACKGROUND On July 17 and 21, 2014, unprecedented lengthy delays to SkyTrain service occurred. The public experienced major inconveniences as the system was down for 5-6 hours. As a result, TransLink commissioned Gary McNeil, former President of GO Transit (Toronto), to conduct an independent review of the two major SkyTrain service disruptions. Mr. McNeil made 20 recommendations in his report issued on November 18, 2014. The recommendations aimed to reduce the frequency and duration of service disruptions, in addition to improving operations, safety, customer service and communication during a disruption. The SkyTrain Independent Review Implementation Program (SIRIP) was created in December 2014 to act upon each recommendation over 5 years (by December 2019). DISCUSSION Progress has been made on all 20 recommendations identified in the 2014 SkyTrain Independent Review conducted by Gary McNeil. The Program is on budget to be delivered within the McNeil estimate of $71 million and on-schedule to be completed within five years (by Q4 2019), as shown in the graphic in Attachment A. Of the 20 recommendations, 10 are complete or closed and 10 are in progress. Since the September Board report, Recommendation 19: “Establish protocols and communication links with local municipalities” has been completed. Budgets for all the recommendations have been included in TransLink’s capital plan. Attachment B summarizes the status for each of the 20 recommendations. Implementation of this Program will help BCRTC address some of the issues related to keeping the 30 year old SkyTrain system in a state of good repair. Examples of recommendations related to state of good repair include developing an asset management plan (Recommendation 6); and transferring system knowledge through updated operations and maintenance manuals (Recommendation 5). Focus on Recommendation 1: Faster System Recovery In the event of a major failure impacting command and control communication between the trains and the Control Centre (as happened on July 17 and 21, 2014), the current SELTRAC technology on the Expo and Millennium Lines requires 3 to 5 hours to get the service back to normal operation due to the manual re-entry of trains into the system. McNeil Recommendation 1 was for TransLink to assess ways to improve the Automatic Train Control (ATC) system recovery and operation. After initially suggesting the installation of an Auto-Restart

Implementation of Recommendations from the 2014 SkyTrain Independent Review November 22, 2016 Page 2 of 10

component McNeil later confirmed (in June 2015) that available software does not meet the envisioned functionality desired. After investigating various options with Thales, a strategy was developed to meet the objectives of Recommendation 1. TransLink will proceed with implementing a software upgrade that will add the following functionality to the ATC system, reducing the system recovery time and improving operations:

a) Avoid train timeouts from temporary loss of communications between the Vehicle Control Centre (VCC) and Vehicle On Board Controllers (VOBCs). This upgrade will allow trains to re-establish communication on its own without the need for a Station Attendant to travel to the train and drive it manually to a re-entry point.

b) Enable securing track switches remotely when a track switch malfunctions. This upgrade simplifies the process of confirming the track switch position in the ATC, requires less time and personnel to implement, and prevents inadvertent routing by the ATC.

c) Simplify process for assigning track direction, which will reduce recovery time and reduce risk of train collision as a result of human error.

d) Enable the ATC system to automatically confirm train lengths that are manually assigned to trains returning to revenue service after receiving regular maintenance at the OMC. This upgrade will avoid derailments and collision with trains that are assigned incorrect train lengths as a result of human error.

Designing and implementing the above four functional improvements simultaneously reduces the costs and schedule, allowing field testing and in-service trials to be performed only once instead of four separate times. Since the September Board report BCRTC have continued to meet with Thales to clarify the project scope and perform contract negotiations, resulting in a $300,000 cost estimate reduction compared with Thales’ first quotation earlier in 2016. The Thales contract is scheduled to be finalized in January 2017, after Specific Project Approval is obtained. Software design will start in Q1 2017. The majority of the software development work is expected to be completed in 2017 with implementation to start soon thereafter. Once the Thales contract is finalized, a more detailed implementation schedule will be available.

In the meantime, a number of system improvements have already been implemented to avoid system failures and reduce the system recovery time required in case of a system failure including:

a) Increasing the number of frontline staff, striving to have staff attend trains outside of stations within 20 minutes of a disruption and getting the trains back to the stations quicker – ensuring a safe evacuation of passengers and faster system recovery. Completed November 2015.


b) Implementing new procedures to allow for several trains to be driven manually at the same time during a service disruption. This will reduce the total amount of time it takes to bring all trains back into a station, safely evacuate passengers and get the system back up and running. Completed November 2015.

c) Preventing avoidable system failures by scheduling critical maintenance activities during non-service hours. Completed March 2015.

d) Improving the guideway intrusion system to reduce false alarms. Completed April 2015. The positive impact of system improvement items a) and b) shown above, was illustrated on November 1, 2016 when 12 trains lost communication with the Vehicle Control Centre (VCC). Allowing multiple trains to be manually driven at one time by the additional station attendants, allowed SkyTrain service to be reinstated up to 40% quicker, with an estimated savings of about 60 minutes in this case.


ATTACHMENT A Schedule

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ATTACHMENT B Implementation Progress

Report Item # Recommendation Intent of Recommendation Status

1. Faster System Recovery (previously referred to as ”Auto Restart”)

Enable a significantly shorter system recovery, if a major communication failure occurs between the trains and SkyTrain Control Centre. Thales, SELTRAC technology supplier, indicated the Canada Line utilized an “Auto Restart” program that could enable a shorter system recovery period. In his June 2015 Status of Recommendations report however, McNeil confirmed the Canada Line system’s Auto Restart program did not meet the envisioned functionality desired.

Preparing Specific Project Approval documentation, including the Business Case and Work Plan, to be submitted to the Capital Review Committee in December 2016 to obtain funding for the following Automatic Train Control (ATC) software upgrades to meet the intent of Recommendation 1: a) Software upgrade to avoid train

timeouts from temporary loss of communications

b) Software upgrade to enable securing track switches remotely

c) Software upgrade to assign track direction to prevent conflicts with manual trains transitioning to automatic control.

d) Software upgrade to confirm train lengths to avoid on-track collisions

2. Modify the Line of Sight

Operating Rule to allow manual operation of multiple trains at one time.

Expedite train recovery to station platforms so passengers were not left on trains for a lengthy duration, reducing the probability of self-evacuation.

Complete • New operating rules and training

were completed in November 2015 to allow all trains to safely operate in a manual mode.

3. Install system continuity redundancies for critical system elements.

Ensure “back-up” systems are available when failures occur on critical systems elements such as power to enable basic train service to not be significantly disrupted.

• Additional work underway for sizing the Operations and Maintenance Centre (OMC) back-up generator and to perform additional power system testing. Work to be completed in Q2 2017.

• Preparing Specific Project Approval (SPA) documentation to request capital funding to implement recommended power supply and distribution improvements including the



design and construction of a second power supply feed for the Operations & Maintenance Centre from BC Hydro. Funding approval expected in Q1 2017.

4. Work on system-critical control components should only be allowed during non-revenue operating hours.

Reduce the likelihood of “accidental” disruptions to critical systems during passenger operating hours.

Complete • Maintenance practices revised

and implemented in March 2015

5. Update and create new operating and maintenance manuals, and procedures.

Ensure the latest operating and maintenance procedures are in place; ensure knowledge transfer from the long term employees prior to retirement.

• Vehicle Work Orders, Checklists and Statement of Procedures (SOP) = 100% Complete

• Wayside Work Orders and Checklists are 71% complete

• Wayside SOPs are 38% complete • Completion by June 2017

6. Decouple important systems and develop an Asset Management Plan.

1. Ensure there is reduced dependencies between systems so if one system fails, it does not completely impact other systems.

2. Development of a complete asset management inventory of BCRTC vehicles, system, wayside and fixed facilities for budgeting and operational controls. In his June 2015 “Status of Recommendations” report Mr. McNeil confirmed it will take “many years to finalize” a complete Asset Management Plan

Decoupling Important Systems • Preparing Specific Project

Approval (SPA) documentation to request capital funding to diversify the Operations & Maintenance Centre power supply to important SkyTrain systems. Funding approval expected in Q1 2017.

• In his June 2015 “Status of Recommendations” report Mr. McNeil noted that BCRTC did not implement his suggestion of a low cost, separate, hard line (Red Phone) connection between BCRTC Control Room and the CMBC Control Room.

• BCRTC has addressed Mr. McNeil’s concern by updating their procedures to direct personnel to use their cell phone or the existing satellite phone when a power outage occurs that affects the Operations & Maintenance Centre phone system.



Develop Asset Management Plan • KPMG has commenced work on

identifying strategic requirements for BCRTC Enterprise Asset Management Business Definition work. Work to be completed in Q3 2017.

7. Upgrade the guideway intrusion system.

Eliminate the nuisance delays which were occurring (at a rate of 450 times per month) due to detection of intrusions which were non-critical (such as newspapers or birds passing through detection sensors).

• Platform Intrusion Emergency System (PIES) repaired, significantly reducing alarms.

• Consultant is updating draft feasibility report to include additional information on guideway intrusion options such as platform edge doors. Second draft of the report expected December 2016.

8. Introduce a single emergency radio band for all TransLink Operating groups

Allows BCRTC, Canada Line, West Coast Express, CMBC and Transit Police to communicate together without going through multiple people and control centres.

• Held workshops with BCRTC Train operations staff, CMBC TMAC staff and Transit Police dispatch staff to discuss interoperability communication requirements.

• Draft report to be issued December 2016.

9. Establish an “alarm-based” warning system for appropriate management and supervisory staff.

Ensure key personnel are always aware of an emergency when it is happening.

Completed Nov 2015 • Solution includes email

alerts/alarms through smart phones.

10. Set front line staffing levels and their service area locations so qualified staff can respond within a specified period of time.

When a system failure occurs, target personnel reaching passengers (trains) within 20 minutes to provide effective system recovery and improved customer service while avoiding the self-evacuation of trains.

Completed Nov 2015 • 30 part time STAs were trained to

provide additional coverage for morning and afternoon peak hours.

11. Install system-wide CCTV coverage.

Provide an alternative to manual response to help during self-evacuation and act as a train location backup, if BCRTC felt that increased staffing was not acceptable.

Closed June 2015 • In his June 2015 “Status of

Recommendations” report, Mr. McNeil acknowledged that through increased staffing and platform-based CCTV (Item 12),



this recommendation should not be required and should be considered closed.

12. Install platform edge CCTV coverage.

This recommendation is an element of Recommendation 7 “Upgrade the guideway intrusion system”. Pan-zoom digital CCTV cameras located to completely scan the guideway area at stations could assist in reducing the delay times associated with intrusion detection alarms.

• Work on this recommendation is included as part of the study described under item 7. The study will provide options on how to proceed.

13. Communicate during lengthy delays that windows can be opened on some trains.

This will reduce the sense of claustrophobia in the vehicle, and reduce the internal heat build-up on sunny, warm days.

Completed Sept 2014

14. Delineation of Walkway Edge

Investigate forms of walkway delineation to reduce the safety risks of evacuating passengers when light levels are low.

• Preparing Specific Project Approval documentation, including the Business Case and Work Plan, to be submitted to the Capital Review Committee for: o Painting the walkway edges

to provide a visual delineation.

o Installation of emergency equipment boxes at each SkyTrain station to contain flashlights to use during evacuations led by Station Attendants.

• Funding approval for $3.5 million expected in December 2016.

15. Increase visibility of frontline staff.

Make staff easily recognizable in times of minor or major crisis to let passengers know there is SkyTrain staff around the system.

Completed March 2015

16. Improve the quality of the Passenger Address

This recommendation addresses the overall poor

• Replacement of existing speakers in Mark I vehicles completed in



System. quality of the current Passenger Address system on the trains and at the stations.

June 2016. • Draft acoustic study completed,

groups recommendations into the following 2 phases: • Phase 1: Includes replacing all

Millennium Line station speakers and select speakers at Expo Line stations, adding additional speakers at select stations, adding amplifiers at select stations, and refining speaker volume and pressure levels at the stations and the Mark II cars.

• Phase 2: Includes adding acoustic tiles at all stations and replacing mesh wall panels at stations with glass panels

• Program Steering Committee to review the draft acoustic study report in their November 28, 2016 meeting.

• Preparation of Specific Project Approval (SPA) documentation to request capital funding to commence in December 2016. Funding approval expected in Q1 2017.

17. Introduce programmable-messaging signboards, fixed signage and PA speakers at the entrances to all stations.

This recommendation recognized that, when the system is closed to the public, and the station grills were drawn down, all the necessary information for customers was out of reach.

• Head-end control system testing completed.

• Draft study issued that recommends sign location and orientation options at all station entrances.

• Sign installation outside entrances of all SkyTrain stations planned to begin in 2017.

18. Strengthen the resiliency of the Call Centre phone system and webpage.

Ensure that critical communication channels to the public do not get overloaded when there is a major delay event.

Complete • 21 additional telephone lines

installed by October 2015. • Website enhancements

completed by September 2014



19. Establish protocols and communication links with local municipalities.

This recommendation recognizes that SkyTrain is not a closed system and operates adjacent to municipal roadways and connects with other public sector organizations. In emergencies, local municipalities and their first responders can assist in managing traffic, pedestrian crowding and decimation of communication messages to the public.

Complete • Workshops held on July 28 and

September 29 with municipal operations and the Regional Transportation Management Centre (RTMC) staff to finalize communication procedures between municipalities and BCRTC during SkyTrain system disruptions.

• Train operation procedures were updated by November 10, 2016

• BCRTC organized a test exercise to confirm the communication procedures were working properly the week of November 14, 2016.

20. Introduce a bus scrolling message advising of major delays.

Advise Bus drivers and bus customers along specific routes that delays are occurring on the SkyTrain.

Completed March 2015 • Used existing technology on

Coast Mountain buses.


FROM: Vivienne King, President and General Manager, BCRTC Sany Zein, Acting Vice President, Infrastructure Management and Engineering DATE: November 22, 2016

SUBJECT: Escalator and Elevator Improvement Initiatives PURPOSE This informational report provides an update on Management’s recent initiatives to improve the availability and reliability of escalators and elevators throughout the TransLink system. Specifically, this report provides information on the following initiatives:

• The Expo Line Escalators Replacement Program; • The Millennium Line Escalators and Expo/Millennium Lines Elevators Condition Assessment;

and, • The Escalators and Elevators Availability Monitoring & Reporting Initiative.

BACKGROUND Elevators and escalators play an important role in TransLink’s transit system, moving passengers vertically to and from rail and SeaBus stations. Maintaining this equipment in a state of good repair is essential for the overall customer experience, especially for persons with mobility challenges. Maintaining escalator and elevator service reliability is also important for TransLink’s reputation as a capable asset manager.

In total, 108 elevators and 158 escalators serve TransLink’s customers at 55 stations on the Expo, Millennium (including Evergreen) and Canada Lines. TransLink’s escalators collectively travel a distance of approximately 3.3 million kilometres every year, equivalent to about 5 round trips to the moon. Table 1 shows the number of escalators and elevators by rail line. The typical life expectancy is approximately 20 years for elevators and 25 years for escalators, although this varies according to maintenance regimes and operating conditions.

The Expo Line is now 30 years old, and escalator and elevator assets from the 1986 – 1991 era are due for replacement. A condition assessment for the Expo Line escalators was completed in 2014, and confirmed that the majority of Expo Line escalators have reached the end of their service life. A similar condition assessment study is planned for 2017 for the Millennium Line escalators and the Expo and Millennium line elevators. In the meantime maintenance activities and overhauls are being undertaken as needed to meet short-term asset requirements.

In anticipation of significant upcoming escalator and elevator work, Management negotiated a Master Services Agreement (MSA) with Kone in 2015 for the future supply and installation of TransLink’s escalators and elevators.

Escalator and Elevator Improvement Initiatives November 22, 2016 Page 2 of 3

Table 1 Escalators and Elevators Inventory Summary

Rail Line No. of Stations

No. of Escalators

No. of Elevators

Year Built

Expo Waterfront to King George

20 35 19 1986-1991 6 3 2006-2009 7 5 2013-2016

14 7 Anticipated 2017-2018 (Note 1)

Subtotal 62 34 Sapperton to Braid 2 4 4 2002

Millennium

VCC-Clark to Lougheed Town Centre

11 25 22 2002

Canada Waterfront to Brighouse/Airport

16 38 32 2009

Evergreen (Note 2)

Lougheed Station to Lafarge Station

6 29 16 2016

Total 55 158 108 Note 1: Upcoming upgrades include the stations at Metrotown, Commercial/Broadway, and

Joyce/Collingwood. Note 2: Number of units shown includes the new elevating devices at Lougheed Station.

DISCUSSION Expo Line Escalators Replacement Program Based on the 2014 condition assessment report, all the Expo Line escalators installed from 1986 to 1991 need replacement. In 2016, Management developed an accelerated replacement program. Leveraging the Master Services Agreement (MSA) with Kone allowed TransLink to have more strategic discussions with the supplier to analyze different replacement scenarios and to receive preferential treatment in terms of production line scheduling and resource dedication.

The accelerated Expo Line Escalator Replacement Program will be completed 2 years earlier with approximately 10% cost savings over the previous phased program. The accelerated program will replace 35 Expo Line escalators and 3 WCE escalators by the end of 2022.

The replacement of escalators results in inevitable station access restrictions and disruptions to customer flows. The work will be programmed to minimize inconvenience to our customers, and the escalator replacement program will be supported by a robust project communications plan and station-specific wayfinding plans.

Escalator and Elevator Improvement Initiatives November 22, 2016 Page 3 of 3 Table 2 shows the current program budget (included in the 10 Year Investment Plan) and schedule.

Table 2 Expo Line Escalator Replacement Program Budget and Schedule

Phase Budget Schedule Design Construction

$3,200,000 $44,500,000

Q4 2016-Q4 2017 2018-2022

Millennium Line Escalators and Expo & Millennium Lines Elevators Condition Assessment A condition assessment study will be conducted in 2017 on the Millennium Line escalators and the Expo and Millennium Line elevators. The outcome of this study will be used to support the development of future capital programs for these assets. The findings are expected by March 2017, and the assessment budget is approximately $350,000. Identified capital requirements will be programmed into future investment plans.

Management will also be conducting an assessment of escalator and elevator typical life cycle maintenance requirements for the region’s specific operational conditions. Escalators and Elevators Availability Monitoring & Reporting Initiative To better understand the availability and reliability of the Expo and Millennium Line escalators and elevators, Management developed and implemented a daily monitoring dashboard to report on the availability and outages of elevating devices. To further improve asset status information and the response to outages, Management is currently exploring an automatic monitoring system for escalators and elevators. This system would allow more consistent and real-time reporting of the status of elevating devices, improving responsiveness, reporting and accountability. Research will be undertaken in early 2017 to support the business case for incorporating the automatic monitoring system into future escalator and elevator replacement and upgrade / retrofit investments.

CONCLUSION With the oldest components of the rail system reaching 30 years of life, TransLink is embarking on an era of significant and continued investments in escalators and elevators. Consistent with the corporate state of good repair priority, Management has responded by (1) developing an accelerated program to replace all the 1986-1991 Expo Line escalators; (2) initiating a 2017 assessment of Millennium Line escalators and all Expo and Millennium Line elevators to identify future investment requirements; and (3) initiating a daily status reporting dashboard and exploring an automated monitoring system to improve responsiveness, reporting and accountability. In the meantime, maintenance and overhaul activities continue in order to meet short-term needs.

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TO: Stakeholder Relations & Service Committee FROM: Geoff Cross, Vice President, Transportation Planning and Policy DATE: November 18, 2016 SUBJECT: Transit Fare Review Progress Update PURPOSE This memo provides an overview of activities and findings from Phase 1 of the Transit Fare Review (May-June 2016) and outlines key activities planned for Phase 2 in early 2017. BACKGROUND The existing 3-zone fare system has remained largely unchanged since it was introduced in 1984. Since that time, the region’s population has grown by over one million people and the transit system and travel patterns have changed substantially. With the successful rollout and rapid adoption of Compass providing an opportunity to rethink the way that transit is priced in this region, in mid-2016 TransLink launched a four-phased Transit Fare Review:

• Phase 1 (Spring 2016): Discover the Issues • Phase 2 (Early 2017): Define the range of possible options • Phase 3 (Spring 2017): Develop the most promising options into a shortlist of “packages” • Phase 4 (Early 2018): Deliver a final recommendation

The goal of the review is to introduce fare policy changes that will increase transit ridership by delivering a better customer experience and improving system efficiency. DISCUSSION Phase 1 Activities In Phase 1, we sought feedback on values and priorities from the public through a consultation questionnaire that was completed by a record 28,229 people as well as a more detailed market research survey with the TransLink Listens Panel, completed by 1,485 respondents. We spoke directly with transit customers through individual and group discussions as well as intercept interviews out on the system and met with key stakeholders across multiple sectors through a series of workshops. In Phase 1, we also undertook an analysis of existing travel patterns as they relate to transit fares; a historical review of fare policy in this region; and a peer review of fare policies from other regions around the world. An overview of the key findings from Phase 1 activities is provided in the attached Phase 1 Summary Report. The more detailed findings are provided in as Appendices available on the Board Sharepoint Site (click here). Phase 1 Key Findings One of the critical findings is that Metro Vancouver residents strongly support TransLink taking a fresh look at the fare system. In both the market research panel survey and the public questionnaire, only 20-

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Transit Fare Review Progress Update November 18, 2016 Page 2 of 12

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30% of respondents agreed that the current fare system works well with about 6-in-10 disagreeing. Further, in all sub-regions the majority of residents disagree that the current fare system works well. From the panel survey, the primary source of this dissatisfaction relates to the zone boundaries and perceptions of inequities. Residents who are dissatisfied with the current fare structure for SkyTrain consider short trips across zone boundaries to be expensive and consider the arbitrary zone boundaries unfair. Although residents who primarily ride the bus are generally satisfied with the current temporary 1-zone fare for all bus travel, residents who use SkyTrain frequently are less satisfied – they see it as unfair because it is currently not distance-based. Those dissatisfied with the current fare structure for SeaBus don’t think they should pay a 2-zone fare for their trip. To fix these and other issues, the prevailing view is that fares should be based more on distance travelled. A strong majority of respondents to both the panel survey (70%) and the public questionnaire (67%) agree with this approach. In terms of priorities that TransLink should take into account when making changes to the fare structure – respondents to the panel survey ranked this as the top priority and respondents to the public questionnaire ranked this as the second priority after “making fares lower for frequent riders.” The other view regarding how to address the perceived inequities of the current zone-based system – far less prevalent but strongly held by about 20% of residents – is that fares should not be based on distance travelled but should be the same for all trip distances. One issue with varying fares by distance travelled is that it can be more complicated to understand and predict how much you’ll pay. “Making it easier to understand and predict how much you’ll pay” is the third priority for panel survey respondents and the fifth priority for public questionnaire respondents. This lower priority in the public questionnaire reflects the finding that frequent transit riders are less concerned about simplicity than infrequent transit riders who may be less familiar with the system. More detail on these and additional findings is included in the attached Summary Report. Planned Phase 2 Activities Drawing on key learnings from Phase 1, in Phase 2 we will ask the public and stakeholders for their level of support on specific options for varying fares by distance-travelled, by time of day or direction or location, and by service type. This input will feed directly into a process of shortlisting down to 3-5 packages in Phase 3. Print and digital advertising will direct interested members of the public to the TransLink website where, from January 16 to February 4, we will host an online questionnaire asking people for their perspectives on a series of specific options. A Discussion Guide and online animated videos will help to explain each of the options and the key trade-off. Moderated online discussion forums hosted by TransLink will provide a venue for respondents to share their perspectives and ideas with each other in more of an ongoing dialogue. As in Phase 1, we will go through the same material with the stakeholder forum and with the TransLink Listens Panel in order to have a more statistically representative picture of public opinion alongside the open public questionnaire.

Transit Fare Review Progress Update November 18, 2016 Page 3 of 12

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An elected officials forum is being planned for early January so that we can engage MPs, MLAs, and Mayors and municipal council members on these questions. Management will share the final Phase 2 Discussion Guide and other supporting collateral with the Board in advance of public launch in mid-January. Should the Board desire, Management can also facilitate a Board workshop to engage on the substance of Phase 2. CONCLUSION Metro Vancouver residents who participated in the Phase 1 consultation are dissatisfied with the way we currently price transit and clearly support TransLink taking a fresh look at our transit fare policy. Perceived inequities around the way we currently price by distance, including the arbitrariness of our zone boundaries, is one of the main drivers of this dissatisfaction. To address these and other identified issues, Phase 2 of the Transit Fare Review will define the range of options for varying fares by distance as well as by time of day or location, and by service type. Public feedback on these options will be a key input into developing a shortlist in Phase 3 from which a final recommendation will be made in Phase 4.

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Attachment A: Transit Fare Review Phase 1 Summary Report PURPOSE OF THIS REPORT In 2016 TransLink launched a comprehensive four-phase review of the way we price transit. In this first phase, we set out to discover the key issues, opportunities and challenges with the current fare system in order to help define the range of options for consideration in the next phase. This report summarizes what we did, what we heard, and what we learned in Phase 1.

PURPOSE OF THE TRANSIT FARE REVIEW TransLink’s three-zone fare structure, originally adopted in 1984, has remained largely unchanged for more than 30 years. In this time, the region has grown by over one million people. We have grown from a system based entirely on buses to one that includes an extensive rail rapid transit network. Urban development and travel patterns have evolved so that people today make trips to and from all parts of the region. Metro Vancouver residents strongly support TransLink taking a fresh look at the fare system. Only 20-30% of respondents we heard from in Phase 1 agree that the current fare system works well with about 6-in-10 disagreeing. Further, in all sub-regions the majority of residents disagree that the current fare system works well. This strong public interest in change, combined with the successful rollout of Compass, provides us with an opportunity to review the way that we price transit in Metro Vancouver. The goal of the Transit Fare Review is to recommend fare policy changes that will increase transit ridership by delivering a better customer experience and improving system efficiency.

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SIDEBAR: There are six core components that currently determine how much you pay to use transit in Metro Vancouver. Distance travelled Customers pay more for each zone boundary they cross. All bus and HandyDART travel temporarily operate under one-zone; SkyTrain and SeaBus under three zones; and West Coast Express operates under its own five-zone structure. Time of travel Customers travelling outside of peak times, after 6:30 p.m. on weekdays and all day weekends and holidays, only pay a one-zone fare on SkyTrain and SeaBus. Service type There is one set of prices for bus, SkyTrain, SeaBus, and HandyDART. The West Coast Express is a higher priced premium service. Product type Customers can choose to purchase a single-ride ticket or use their Compass Card to get a discount by using Stored Value or purchasing a DayPass or a Monthly Pass. User type Adults pay full price. Youth, seniors, and people with disabilities that impact their ability to travel independently are eligible to travel at a reduced price. Children four and under travel for free when accompanied by an adult. Journey time Customers can make multiple trips across bus, SkyTrain, and SeaBus on a single fare for up to 90 minutes and 120 minutes with a West Coast Express fare.

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WHAT WE DID IN PHASE 1 In Phase 1, we sought feedback from the broader public through a public consultation questionnaire that was completed by a record 28,229 people and a parallel (but more detailed) market research panel survey with the TransLink Listens Panel, completed by 1,485 respondents. Both sought to identify what riders’ perceive as issues with the current fare system and what should be the priorities for a future fare system. The results of the TransLink Listens panel survey were weighted by age, gender, area of residence, and primary mode of transportation in order to generate findings that are more closely statistically representative of the region’s adult population (age 19 and older). The full market research panel survey report is in Appendix A and the public questionnaire analysis is in Appendix B. We also listened directly to transit customers through individual and group discussions as well as intercept interviews out on the system. This is where we heard about customer experiences and customer decision-making processes related to fares and payment. The full report from this customer experience work is in Appendix C. Through a series of workshops, we heard from key stakeholders across multiple sectors, meeting with 85 people from groups representing: labour, business, environment, health, faith, people with disabilities, students, children, youth, seniors and TransLink’s Access Transit User Advisory Committee. The workshop learnings are recorded in Appendix D. Our research was also informed by understanding existing travel patterns as they relate to transit fares by analyzing some early Compass data and the 2011 Trip Diary. The technical report provides data on customer travel behaviour prior to the implementation of the one zone fare policy on buses and is shared in Appendix E. This Appendix also includes an assessment of current and future payment technology capabilities. Finally, we undertook a historical review of transit fare policy in this region as it has evolved over the years which you can find in Appendix F and a peer review of transit fare policies from other regions around the world can be found in Appendix G. A glossary of terms in included as Appendix H. You can find the more detailed analysis contained in all of these Appendices on the TransLink website here: http://www.translink.ca/farereview

http://www.translink.ca/farereview

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WHAT WE HEARD IN PHASE 1 Support for the Current Fare System Residents strongly support TransLink taking a fresh look at the fare system. In both the market research panel survey and the public questionnaire, less than one-third of respondents agreed that the current fare system works well with about 6-in-10 disagreeing. Further, in all sub-regions the majority of residents disagree that the current fare system works well. TransLink Listens

Market Research Panel Survey1 Public

Questionnaire2 Agree/Strongly

Agree Disagree/Strongly

Disagree Agree/Strongly

Agree Disagree/Strongly

Disagree The current zone-based fare structure works well

27% 58% 19% 64%

Priorities for a Future Fare System Respondents were asked to select their top four priorities from a list of 11. The top six most commonly selected are listed in order below.

Priority TransLink Listens Market Research Panel Survey

Public Questionnaire

#1 Make fares lower for shorter distance trips

Make fares lower for people who use transit frequently

#2 Make fares lower for people with less ability to pay Make fares lower for shorter distance trips

#3 Make it easier to understand and predict how much you’ll pay

Provide more fare product options for different periods of time (e.g., 3-day, weekly)

#4 Make fares lower at less busy times More fare products options to make transit more affordable for families to travel together

#5 Provide more fare product options for different periods of time (e.g., 3-day, weekly)

Make it easy to understand and predict how much you’ll pay

#6 Make fares lower for people who use transit frequently

Make fares lower for people with less ability to pay

1 Market research survey results (n=1,485) were weighted by age, gender, area of residence, and primary mode of transportation to generate findings that are statistically representative of the region’s adult population. 2 Public Questionnaire results (n=28,229) were not weighted and are more reflective of younger residents who ride transit more frequently as this demographic filled out the questionnaire in greater numbers.

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Possible Future Fare System Components

TransLink Listens Market Research Panel Survey3

Public Questionnaire4

Agree/ Strongly Agree

Disagree/ Strongly Disagree

Agree/ Strongly Agree

Disagree/ Strongly Disagree

Distance Fares should be lower for shorter distance trips and longer for longer distance trips

70% 17% 67% 19%

Time of Travel Fares should be lower at less busy times of day than at busier times of day

62% 24% 38% 33%

Service Type: Quality of Service Fares should be lower for slower and less direct services than for faster and more direct services

50% 31% 38% 38%

Service Type: Cost of Service Fares should be lower for services that cost less to build and operate than for services that cost more to build and operate

30% 45% 30% 43%

Product Type There should be more fare product options for different periods of time (e.g. 3-day, weekly)

66% 11% 72% 8%

User Type Fares should be lower for people with less ability to pay than for people with more ability to pay

58% 25% 53% 29%

3 Market research survey results (n=1,485) were weighted by age, gender, area of residence, and primary mode of transportation to generate findings that are statistically representative of the region’s adult population. 4 Public Questionnaire results (n=28,229) were not weighted.

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WHAT WE LEARNED IN PHASE 1 Through Phase 1 we gathered and analyzed a large amount of rich information from other agencies, from travel data, and from transit users, stakeholders and the broader public. This section describes what we learned – focusing on the key insights that will help define the range of options we consider in Phase 2. This section is organized around the six components of fare policy. DISTANCE TRAVELLED

The primary source of dissatisfaction with the current fare system relates to perceptions of inequities around how we price by distance today.

From the panel survey, residents who are dissatisfied with the current fare structure for SkyTrain consider short trips across zone boundaries to be expensive and consider the arbitrary zone boundaries unfair. Analysis of Trip Diary data shows 46,000 daily two-zone trips are less than 10 kilometres while 2,800 daily one-zone trips are over 20 kilometres – suggesting that the problem of short trips crossing a zone boundary is a very real one for many people. Although residents who primarily ride the bus (about half of all trips are bus-only trips) are generally satisfied with the current temporary 1-zone fare structure for bus, residents who use SkyTrain frequently (about half of all trips include SkyTrain) are less satisfied with the current fare structure for bus – they see it as unfair because it is currently not distance-based. Those dissatisfied with the current fare structure for SeaBus don’t think they should pay a 2-zone fare for their short trip just because it crosses a zone boundary. To fix these and other issues, the prevailing view is that fares should be based more on distance travelled. A strong majority of respondents to both the panel survey (70%) and the public questionnaire (67%) agree with this approach. In terms of priorities that TransLink should take into account when making changes to the fare structure – respondents to the panel survey ranked this as the top priority and respondents to the public questionnaire ranked this as the second priority after “making fares lower for frequent riders.” The other view regarding how to address the perceived inequities of the current zone-based system – far less prevalent but strongly held by about 20% of residents – is that fares should not be based on distance travelled but should be the same for all trip distances. One issue with varying fares by distance travelled is that it can be more complicated to understand and predict how much you’ll pay. “Making it easier to understand and predict how much you’ll pay” is the third priority for panel survey respondents and the fifth priority for public questionnaire respondents. This lower priority in the public questionnaire reflects the finding that frequent transit riders are less concerned about simplicity than infrequent transit riders who may be less familiar with the system.

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TIME OF TRAVEL

A majority of respondents to the panel survey support fares that are lower during less busy times of day than at busier times of day – with especially strong support from youth and seniors.

Transit systems around the world, including those in New York City, London, Singapore, and Sydney, have fare prices that differ depending on the time of day. Specifically, fares are higher during peak hours when the system is the most busy or lower during off-peak hours when the system is the least busy. The intent of peak/off-peak fare price distinctions is to encourage price-sensitive riders who have a flexible schedule to shift their travel behaviour to less busy times of day, so that there is more space available on the system for those riders who need to use the system during its busiest times. Analysis of data from TransLink’s 2011 Trip Diary Survey TransLink’s found that the transit system experiences the greatest level of demand in the most concentrated amount of time during the morning rush hour, or AM Peak. Over 180,000 transit-only trips take place between 6:00 a.m. and 8:59 a.m. each weekday. Demand also increases during afternoon rush hour, or PM Peak, however, it is spread out across a longer amount of time, so that the system as a whole does not experience the same degree of overcrowding as in the AM Peak. TransLink’s current fare system has an off-peak evening discount that is in effect on weekends and weekday evenings after 6:30 p.m. Prior to 1997, TransLink also offered a mid-day discount on trips taken during the middle of the day when the system had the greatest excess capacity. When the discount was eliminated in 1997, travel data indicates that the peak hours became busier as flexible, price-sensitive riders no longer had a price incentive to travel during the mid-day period. Sixty-two per cent of panel survey respondents agreed or strongly agreed that fares should be lower at less busy times of day than at busier times of day. The public questionnaire, however, had comparatively lower levels of support, with less than half agreeing or strongly agreeing. This divergence was primarily the result of age differences. Support for varying fares by time of day is highest in older age groups and the majority of public questionnaire respondents were under the age of 35, with older ages under-represented. SERVICE TYPE

About half of residents support charging lower fares for slower and less direct service than for faster and more direct service.

In Phase 1, we heard that 50 per cent of Metro Vancouver residents agree that fares should be lower for slower and less direct services (vs. 31 per cent who disagreed). However, 45 per cent disagreed that fares should be lower for services that cost less to build and operate (vs. 31 per cent who agreed). “Making fares lower for services that cost less to build and operate” received the lowest level of support out of 11 possible priorities in the public questionnaire. In October 2015, a temporary one-zone fare price was introduced for all bus trips, regardless of how far a rider travelled. This new policy was introduced to streamline the introduction of Compass on the transit system as a whole. It has resulted in a transit system that has fare price distinctions by service type, as two and three-zone trips on SkyTrain and SeaBus are now more expensive than an equivalent trip on the bus.

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The panel survey revealed that bus-only riders (about half of all trips) are generally happy with the temporary bus anywhere 1-zone fare whereas riders that also make use of rapid transit (about half of all trips) are less satisfied - likely due to fairness concerns. PRODUCT TYPE Most trips are made using monthly passes but there is some support for more product options, especially a weekly or 3-day pass.

Depending on the mode of transit, monthly passes are used to pay for between 34 per cent and 47 per cent of all trips on transit, making it the most commonly used form of fare payment across the system. Cash is the least commonly used method of payment. Sixty-six per cent of Metro Vancouver residents feel there should be more fare products for different periods of time. The most commonly proposed products were a weekly pass (27 per cent), a lower off-peak fare pass (24 per cent), and a 3-day pass (15 per cent), all of which were suggested, unaided, by residents in Phase 1. Currently, TransLink offers products in day and month-long periods only. USER TYPE

There is strong support for a system that is affordable – especially for people who use transit frequently and for people with less ability to pay.

“Affordability” means different things to different people. Customer research indicates that transit affordability is usually defined in relation to other aspects of an individual’s financial situation, including overall income and other major costs of living such as food and housing, currently at record high levels in Metro Vancouver. The cost of taking transit is often compared to the cost of other transportation options. “Fares should be set to be a cost competitive alternative to driving” was strongly supported in the panel survey at 81 per cent agreeing, a finding that was also reflected in the public questionnaire. While the definition of personal affordability varies, the panel survey asked detailed questions about who should be eligible for lower fares and found that two-thirds agreed with a fare structure that would make fares lower for low income individuals. This was supported by findings in the public questionnaire, which found that the majority of Metro Vancouver residents agree or strongly agree that “fares should be lower for people with less ability to pay than for people with more ability to pay.” Customers believe TransLink has a duty to provide a public service and a responsibility to ensure equitable access to this service. Specifically, customers interviewed expressed that TransLink should not behave like a profit-seeking company. This sentiment was supported by strong rejection of cost-based pricing for transit. “Making fares lower for services that cost less to build and operate” received the lowest level of support out of 11 possible priorities in the public questionnaire.

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Most transit trips are short (less than 10 kilometres), especially trips made by lower income riders, but shorter trips pay a higher average fare than longer trips.

Trips that are less than 10 kilometres pay the highest average fare, approximately 70 cents per kilometre. The average fare decreases as distance increases, so that trips over 20 kilometres pay the lowest average fare overall, 10-20 cents per kilometre. However, analysis of customer travel data found that customers with an annual household income below $25,000 tend to take shorter distance trips while customers with reported household incomes above $75,000 tend to travel further distances than customers from income groups that are lower. Similarly, transit trips by lower income users are spread evenly across the day. Transit trips by lower income users tend to take place throughout the day and are less concentrated during peak periods than other income groups. Analysis of customer user data has identified that those with annual incomes below $25,000 tend to travel between 8:00 a.m. and 5:00 p.m. during mid-day when more capacity is available. Conversely, those with annual incomes above $75,000 tend to travel during peak periods. JOURNEY TIME In the current system, a transit rider can transfer to other transit vehicles headed in any direction within 90 minutes of the first tap in without being required to pay an additional fare. 44 per cent of Metro Vancouver residents felt that this 90-minute transfer window is not long enough. NEXT STEPS In early 2017, we will launch Phase 2 of the Transit Fare Review using feedback from Phase 1 to help define and evaluate the options for varying fares by distance traveled, time of travel, and service type. We will also begin to map out the options for different types of products and passes, user discounts, and rules around connections (or transfers) between services. We look forward to hearing your preferences on this range of options in order to help us narrow down to a short-list for Phase 3 and a recommended approach in Phase 4.

Documents

TransLink Board of Directors Report Package for December 8 ......TransLink Board of Directors Report Package for December 8, 2016 Open Board Meeting . ... Budgeted Contingency & Reserve