Staff Report #3
August 31, 2026
To All Commissioners
Re: Financial Update – Conventional Transit Services – Operating Budget – July 31, 2026
Recommendation
That the report be RECEIVED for information.
Background
Set out in the table below is the Statement of Operations for Conventional Transit Services for the seven-month period ending July 31, 2026. The statement sets out actual to budget performance for the period.
London Transit Commission Statement of Operations – Conventional Transit Services Seven Months Ending July 31, 2026 (000’s omitted)
| Description | Actual | Budget | Amount Better (Worse) | Percent Better (Worse) | |
| Revenue | |||||
| Transportation | $ 22,098.4 | $ 22,074.0 | $ 24.4 | 0.1 % | |
| Operating | 1,302.4 | 1,195.9 | 106.5 | 8.9 % | |
| Transfers from reserves | 839.7 | 635.3 | 204.4 | 32.2 % | |
| Province-provincial gas tax | 5,886.3 | 5,886.3 | – | 0.0 % | |
| City of London | 32,235.8 | 32,235.8 | – | 0.0 % | |
| Total revenue | 62,362.6 | 62,027.3 | 335.3 | 0.5 % | |
| Expenditure | |||||
| Personnel cost | 41,012.3 | 41,412.6 | 400.3 | 1.0 % | |
| Direct bus maintenance | 6,785.2 | 6,076.6 | (708.6) | (11.7)% | |
| Fuel | 6,511.4 | 5,340.8 | (1,170.6) | (21.9)% | |
| Facility costs | 2.507.7 | 2,639.6 | 131.9 | 5.0 % | |
| Insurance | 3,852.8 | 3,670.8 | (182.0) | (5.0)% | |
| Contribution to reserves | 346.2 | 361.2 | 15.0 | 4.1 % | |
| All other material expense | 2,477.1 | 2,525.7 | 48.6 | 1.9 % | |
| Total expenditure | 63,492.7 | 62,027.3 | (1,465.4) | (2.4)% | |
| Net favourable/(unfavourable) | $ (1,130.2) | $ – | $ (1,130.2) | (1.8)% | |
As indicated in the above table, the conventional service has a net unfavourable operating budget performance to date of 1.8% or $1,130,200. An explanation of the key variances is set out below.
Revenue
- favourable transportation revenue of $24,400 due mainly to the mix of riders, noting that average fare is higher than anticipated while ridership is just slightly below budget (266,000 rides);
- favourable operating revenue of $106,500 due to higher than anticipated interest income and proceeds from the disposal of replacement buses, noting the favourable income attributable to reserve fund interest is offset below under contributions to reserves; and
- favourable transfers from reserves of $204,400 required to support the higher than budgeted liability claims incurred during the first seven months of the year.
Expenditures
- favourable personnel costs of $400,300 due primarily to ongoing vacant positions, noting the vacancies within the Fleet & Facilities department are supported by the outsourcing of repairs to a third party as evidenced by the unfavourable direct bus maintenance expenditure;
- unfavourable direct bus maintenance costs of $708,600 directly related to the outsourcing of repair work due to mechanical staff shortages as well as increased costs for engines and brake work;
- unfavourable fuel costs of $1,170,600 due mainly to higher than budgeted diesel fuel prices relating to the current conflict in the middle east and resulting spike in fuel rates;
- favourable facility costs of $131,900 due to lower than budgeted utilities (hydro and natural gas); and
- unfavourable insurance costs due to higher than budgeted liability claim payouts, noting these claims are expensed when paid out and thus subject to timing related variances.
Ridership
The table below sets out actual to budget ridership performance as well as a comparison to the same period in the previous year.
Ridership Performance – Actual vs. Budget Seven Months Ending July 31, 2026 (000’s omitted)
| Description | Actual | Budget | Variance | % Variance | 2025 Actual | % Variance |
| Total Passengers (000’s) | 8,950.9 | 9,216.9 | (266) | (2.9)% | 10,309.5 | (13.2)% |
| Average Fare | $ 2.469 | $ 2.395 | $ 0.074 | 3.1 % | $ 2.171 | 13.7 % |
| Revenue Service Hours | 429.8 | 431.0 | (1.2) | (0.3)% | 413.3 | 4.0 % |
| Rides/Rev Service Hour | 20.8 | 21.4 | (0.6) | (2.6) % | 24.9 | (16.5)% |
Ridership is slightly below the year-to-date budget level but 13.2% lower than 2025 levels for the same period due mainly to the flow-through impacts of the reduction in tuition pass riders that began in September 2025 related to the declining enrollment of international students.
Administration will continue to monitor the operating budget performance, including ridership, on a monthly basis.
Recommended by:
Mike Gregor, Director of Finance
Concurred in by:
Kelly S. Paleczny, General Manager