City issues formal notice of default to RTG

Ottawa city council has unanimously agreed to issue Rideau Transit Group (RTG) a formal notice of default over ongoing problems with the Confederation Line, an unprecedented move for the city.

"This is a strong escalation," said Mayor Jim Watson following a three-hour closed-door meeting Monday. "Plainly stated, we're not getting what we paid for."

The notice of default will be issued Tuesday. RTG will then have until March 31 to provide a "credible and realistic" time frame to fix the issues, although Watson noted "time is running out" for the consortium.

In a brief written statement, Rideau Transit Group said it will review the motion and consider how to respond with its principal partners: engineering firm SNC-Lavalin, construction firms EllisDon and ACS and Alstom, the maker of the trains.

"RTG, RTM [Rideau Transit Maintenance] and all partners are committed to continue fulfilling the terms of its contract with the city, and doing everything it can to ensure that Ottawa's LRT system is providing optimal service to Ottawa commuters," the statement read.

The notice of default is the first step in a complex process for the city to end the contract "for cause," explained city manager Steve Kanellakos, who added that the city has never issued this sort of notice for such a significant contract.

Watson said he wants to see issues resolved by the end of the summer, but certainly before the year is out.

$2B maintenance contract

But the notice doesn't mean the city will necessarily end its relationship with RTG, whose maintenance arm, Rideau Transit Maintenance (RTM), has a 30-year contract worth $2 billion for both stages of the Confederation Line. 

It was not immediately clear what would happen if the RTG plan isn't deemed acceptable, but the contract does allow the city to take more serious financial measures until the final step, which would be breaking the contract.

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Less than two weeks ago, a record number of light rail trains were unavailable — at one point, just seven of the 17 the city bought and paid for were running — and six different train issues in back-to-back peak periods forced some passengers to disembark and walk along the tracks, including in the tunnel.

RTM has been able to run 12 trains during morning and afternoon rush hours in recent days, but that's still short of the 13 it had agreed to.

That's also a far cry from the 15 trains that OC Transpo boss John Manconi had told council for months would be the full complement during rush hour.