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Bruce McCuaig, president and CEO of Metrolinx outlines the agency's shortlist of revenue tool options in advance of its official investment strategy.Fred Lum/The Globe and Mail

The route for a subway extension in Toronto's east end will be left to the city and its transit agency to determine through environmental assessments.

Regional transit agency Metrolinx, which had been committed to building light rail in part of Scarborough, has bowed out of the increasingly contentious debate over how best to serve the area.

The decision raises the stakes as council prepares to revisit the issue next week. Building a subway instead of light rail garnered majority support during the summer in a council vote, subject to several conditions.

On Wednesday, the agency released a letter it had sent to the city saying that it will accept whatever route council and the Toronto Transit Commission pick after a full environmental assessment of the options.

"We're speaking for Metrolinx on this, but we believe the province would endorse the position we've set out," Metrolinx chair Rob Prichard told a news briefing.

"You should assume that it's supported by the province."

A spokesman for Transportation Minister Glen Murray confirmed this is the case.

Mr. Murray has said the province is willing finance a largely above-ground route as far as Scarborough City Centre generally along the alignment of an aging rapid transit line. In the summer, Toronto city council voted for an underground extension up McCowan to Sheppard.

Last week, the federal government threw its weight behind the city-backed route by pledging $660-million.

Also last week, the TTC issued a report that called Mr. Murray's alignment inferior to the route up McCowan.

Metrolinx CEO Bruce McCuaig said it should not be assumed an environmental assessment will necessarily result in the route the city and the TTC want.

"It's fairly normal practice … in an environmental assessment process, to look at alternative ways of addressing the problem that's trying to be solved," he told the briefing.

"We would expect, and I think the city and the TTC would expect, that those various alternatives would be identified and would be evaluated and analyzed in a very systematic and comprehensive fashion, and that would lead to, in the end, the optimal choice of both alignment as well as station location, and we think that's the proper route to be followed."

Rapid transit in Scarborough has become a hot issue, with politicians at all levels of government looking use it to retain support or improve their standing in the area.

The Metrolinx letter, addressed to city manager Joe Pennachetti and signed by Mr. McCuaig, makes the case that an LRT would serve the area. But in both the letter and the subsequent briefing, Mr. McCuaig said "governments are the ultimate decision makers."

Several factors have emerged since council's summer vote. The city's portion of the subway construction cost has risen to at least $900-million, and two key criteria set by councillors – that the province pay $1.8-billion and that Ottawa provide half the net capital cost – were not met by the deadline of Sept. 30.

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