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Rob Ford is consistent, you have to give him that. The mayor has made it clear all along that he dislikes streetcars and all other forms of transit that roll along city streets on rails. They only get in the way of traffic and, as he said at the auto show last week, "the war on the car is over." All new railed transit, he insists, must go underground.

It's a stubborn prejudice and, if recent events are any sign, it could be an enormously costly one for the city. According to those familiar with the current transit negotiations, Mr. Ford's refusal to countenance surface rail led to his surprising offer last week to have the city take over responsibility for an extended Sheppard subway line that would cost billions.

Here is how it happened. Go back to Dec. 1. On his very first day in office, Mr. Ford declared that he was killing Transit City, the project backed by his predecessor David Miller that would have built a web of light-rail lines to connect up with the rest of the transit network. It was not strictly Mr. Ford's call to make, because almost all of the funding for the huge project was coming from Queen's Park. But Liberal Premier Dalton McGuinty said he could not ignore the views of the new mayor. The Toronto Transit Commission and Metrolinx, the regional transit agency, sat down with Mr. Ford's people to work out a new plan.

Mr. Ford made it clear that his priority was to extend the Sheppard subway, taking it east from its current terminus at Don Mills on to the Scarborough city centre next to Highway 401. Metrolinx said its priority was to build the Eglinton Crosstown, a light-rail line that it considers an important part of its broader regional transit plan.

A third project is also part of the still-ongoing talks: the Scarborough rapid transit (SRT) line, which connects the end of the Bloor-Danforth line at Kennedy station to the Scarborough city centre. It is nearing the end of its useful life and needs replacing.

The trouble is that there is not enough provincial money for all three projects: the Sheppard subway, the Eglinton Crosstown and the SRT replacement. The province made it clear that, with its bulging budget deficit, it could not go beyond the roughly $8-billion it has put aside for Transit City.

What to do? Intense talks have been going on for several weeks. Metrolinx would have settled for building the Eglinton Crosstown in its original Transit City form and replacing the SRT, leaving hundreds of millions left over for other projects like a start on Mr. Ford's Sheppard subway extension. The mayor's office said no.

Even though much of the original Eglinton Crosstown would travel through a tunnel just like a subway – 11 kilometres of tunnel in all, heading east and west from Yonge – the mayor did not like the fact that it would emerge to travel above ground on its eastern end, from Laird Drive to Kennedy Road. That would have violated his go-underground edict.

So the mayor's office came back with a counterproposal: put all of the Eglinton line underground, tunnelling right out to Kennedy. That, of course, would raise the cost dramatically – underground transit costs at least three times as much as surface rail – taking it from $5-billion to $6.9-billion. In other words, Mr. Ford is willing to pay a nearly $2-billion premium to avoid having any above-ground rail on Toronto streets – even wide, low-density suburban streets like eastern Eglinton.

Do the math. Add $6.9-billion to the cost of a new SRT and you have effectively consumed the $8.73-billion available from Queen's Park. That means there was no provincial money left for a Sheppard subway extension.

The mayor's negotiators saw the problem but were unwilling to drop the Sheppard subway. So they made an unexpected offer: we will take on that project ourselves. The mayor's office said last week that the city would seek private partners to build the Sheppard line all the way to Scarborough. It would raise the money by increasing development charges on new buildings near the subway stations and by reaping a share of the higher property taxes that would result.

This seems to suit the provincial side just fine. On Friday, the Metrolinx chair praised the city in glowing terms for "stepping up as a partner and potentially bringing additional resources to the building of transit in the city." And no wonder. The province was never much interested in funding a massive subway project on Sheppard. The city's funding plan may be dubious, relying on development that might not materialize for years, if at all, but that is not Queen's Park's worry. If you want to try getting private money to build your subway, the province seems to be saying to Mr. Ford, knock yourself out.

Here is where we are left. When Mr. Ford came to office, the province was ready to fund four new transit lines: Sheppard, Finch, Eglinton and the SRT replacement. Under the deal now being contemplated it would pay for two: an Eglinton line with much more tunnel and the SRT replacement. The city of Toronto would be left alone – at its own suggestion, no less – to find financing for a Sheppard subway that is expected to cost up to $4-billion, maybe more. And all because of the mayor's loathing for rails on streets.