Hazel McCallion LRT struggled with liquidity, design and ‘quality of work performed’

Ontario’s transit authority, Metrolinx, has revealed internal documents showing the Hazel McCallion Light Rail Transit (LRT) project has encountered serious challenges, including liquidity problems, design flaws, and poor quality of work. These issues have caused the project to fall four years behind its original completion date, with the final stretch of the 18-kilometre, 19-stop route now expected to finish in 2028 instead of 2024. The problems emerged during 2025, according to briefings obtained by Global News through freedom of information requests. These documents indicate that Metrolinx and the Ford government were increasingly concerned about the performance of the consortium, Mobilinx, tasked with constructing the LRT. The issues included financial difficulties, design shortcomings, and difficulty securing necessary work permits. These factors collectively contributed to major delays in the project timeline. Construction on the Hazel McCallion LRT began in 2020, initially set to conclude in 2024. However, the latest updates confirm that the project is far from meeting that deadline. A government briefing from March 2025 outlined the severity of the situation, stating that the project required substantial project management efforts to regain momentum or risk seeking an entirely different approach. It listed several key concerns, including the quality of work produced, reduced productivity due to liquidity constraints, incomplete design work, and the resulting inability to secure essential permits. A Metrolinx spokesperson confirmed that construction is ongoing, noting that track work has reached 46 of 55 intersections. Despite these efforts, local political figures have expressed frustration over the project’s management. Ontario NDP MPP Tom Rakocevic criticized the handling of the LRT, pointing to persistent issues with oversight, design, and permit acquisition. He described the situation as indicative of broader mismanagement under the Ford government and Metrolinx leadership, emphasizing that the project should have been completed two years earlier. The internal warnings about the project’s struggles came approximately a year before Metrolinx decided to restructure the original contract with Mobilinx. In July, the agency announced that the $4.6 billion P3 contract, signed in 2019, had been divided into two separate agreements. Originally, the P3 model allowed Mobilinx to design, build, operate, and maintain the line under a single contract. However, such contracts have historically led to delays and legal disputes over responsibility for setbacks. The new structure involves an alliance agreement to construct the route and retains the existing P3 terms for operation and maintenance. This shift reflects a strategic move toward alliance contracts, which are considered more flexible and provide greater control over payment schedules. Both Metrolinx and the Ford government have publicly endorsed alliance contracts as preferable to traditional P3 models in most cases. While Metrolinx did not explicitly state that the restructuring was a direct response to the consortium’s performance issues, the timing suggests a connection. The agency emphasized that the new contracts remain with the same consortium, indicating a continued reliance on Mobilinx despite past challenges. The outcome of this restructuring will likely shape the future of the Hazel McCallion LRT and could influence how similar large-scale infrastructure projects are managed moving forward.