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Toronto mayor John Tory attends a press conference outside Joyce Public School on Jan 19 2015.Fred Lum/The Globe and Mail

The TTC's final adoption of the Presto fare-card system will happen even later than expected.

The Toronto Transit Commission has been gradually rolling out Presto across its network and planned to stop accepting "legacy fare media" – tickets and tokens and Metropasses – by the middle of next year. But new delays are pushing the full switchover date farther into 2017.

TTC spokesman Brad Ross said Friday that Presto has been slow developing the software needed for the card to offer Metropass-like functionality. As a result, the TTC is now going only so far as to promise that the old ways of paying will be phased out no later than the end of 2017.

The delay is another black eye for Presto. The card was dreamed up as a made-in-Ontario solution by the government at Queen's Park, which hoped to create a system so good it could sell it to the world. Instead it has taken years, cost a fortune and has less functionality than cards in use in some cities. It has few users so far on the TTC, by far the biggest transit agency in the province.

The upside of the Presto delay, though, is that it might help the TTC close part of its looming budget shortfall. Instead of budgeting $30-million in fees to Presto next year, the agency is now pencilling in $14-million.

This adjustment is one of a few projected savings that have let the TTC whittle its budget gap from  $215-million to about $173-million. But in a report Friday, which revealed the agency had identified the minimal cost-savings ordered by city hall, it made clear that harder work remains.

"At the present time, the remaining pressure is about $172.6-million," according to the report, signed by TTC chief financial and administrative officer Vincent Rodo. "Options for addressing this will be developed and provided as part of the formal budget presented to the TTC Board later this fall."

The agency will need this additional money next year to maintain the same level of service. The total includes costs related to launching the Spadina subway extension to York Region, implementing Presto, even with the later changeover now envisioned, vehicle maintenance and wages and benefits. An extra $15-million will be needed for fuel costs, the TTC is projecting, including $5-million related to Queen's Park's new cap-and-trade program.

Separate from this shortfall was a demand, spearheaded by Toronto Mayor John Tory, that all city agencies find 2.6 per cent in cuts to their operating budget. The demand sparked a wave of backlash, with critics saying the TTC was strapped for cash already.

On Friday the agency said it could meet the target by measures including fewer land-lines for employees who have mobile phones and by cutting travel and training costs. Other costs were beyond the agency control. TTC can claim a saving because sagging ridership allowed it to avoid putting on extra service and because fewer-than-expected healthcare claims were submitted.

"The key to what's been identified … is they're really things that don't affect service," said TTC Chair Josh Colle. "We met [the 2.6 per cent directive] … everyone can relax. But there's still the bigger piece of work that needs to be done."

TTC chief executive Andy Byford has previously signaled that he would not accept drastic measures to close this looming gap, including possibilities such as major fare hikes or delaying the opening of the subway extension.