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Toronto's subway system.Fred Lum/The Globe and Mail

A new $3.2-billion subway line to take Toronto's squished and squeezed commuters east from the downtown core is emerging as a new front-runner in the battle for scarce transit funding.

The "downtown relief line" is needed to ease overcrowding on the city's strained Yonge line and divert rush-hour riders from the crammed Yonge-Bloor station, says a new TTC report. It predicts that a booming downtown population and increases in suburban commuters will push up ridership in the city's core by more than 50 per cent by 2031. New streetcars and subways that can carry more riders and improved GO rail service won't be enough to address the demand, it says.

The $2-million study will be considered at a Toronto Transit Commission meeting next week.

"There will be little spare capacity on the Yonge subway to accommodate further increases in transit ridership," it states. It recommends that a relief line be moved up the priority list of the province's transit agency Metrolinx and put ahead of plans to extend the Yonge line from Finch Avenue to Highway 7.

"With the Yonge line nearing capacity and the Bloor-Yonge subway station already at capacity, all parties – TTC, city and province – need to give the DRL very serious consideration," TTC spokesman Brad Ross said.

As a first step, the report recommends the construction of a line from St. Andrew station at King Street and University Avenue east to Pape station on the Bloor-Danforth line. Another alternative would include a western leg from St. Andrew to Dundas West station, raising the cost from $3.2-billion to $6.2-billion.

This latest report, commissioned by council earlier this year, comes as the city begins public consultations on new sources for transit funding, including tolls and taxes. A number of politicians – including provincial Progressive Conservative Leader Tim Hudak – are joining Mayor Rob Ford in proclaiming subways as the best choice for Toronto's transit expansion.

While the staff report provides a costing for four options, it does not discuss how that money would be raised. The TTC is in the final stages of negotiations with the province for a $8.4-billion network of light-rail lines. Council approved that deal this spring over the objections of the mayor who wanted the money used to bury the entire Eglinton light rail line.

Councillor Doug Ford, who along with his brother remains committed to building subways, said he will consider this latest option. "I'm for subways," he told reporters Wednesday. "Any subway is a good subway. That's my theory."

The report also costs out two more extensive options that would have the subway line continue north and east from Pape station, linking with the planned Crosstown light-rail line at Eglinton Avenue and Don Mills Road. Under one scenario, the line would serve the east end only beginning at St. Andrew and would cost $5.5-billion. A line that begins at Dundas West and runs south through the downtown and then northeast to end at Eglinton and Don Mills is estimated to cost $8.3-billion.

Councillor Pam McConnell, who represents a downtown ward that would be served by the new eastern line, said the subway proposal is one of several projects that will be required to meet the increasing demand for transit in the core.

"I don't think there is one way that will entirely resolve this matter," she said.

Metrolinx CEO Bruce McCuaig said the regional transit agency "fully supports" the need for a downtown relief line, and stressed that his planners have been working closely with TTC and City of Toronto officials on this file.

Metrolinx last fall began studying two long-term options on relieving congestion in the Union Station precinct, one of which is a version of the downtown relief line that would terminate at a proposed GO station near Bathurst and Front instead of looping back up to the Bloor Danforth subway, as the TTC has suggested.

"There's going to be a lot of discussion on the alignment," he said, noting that the most important priority at the moment is "moving forward on the investment strategy."

With a file from John Lorinc, Special to The Globe and Mail