I think the situation in every municipality is unique and the municipalities are best placed to answer those questions.
Generally speaking, what the Government of Canada looks at when transit infrastructure projects are proposed is essentially whether it is a reasonable project: are you overbuilding or are your modal share projections realistic? One of the characteristics of public transit is that it's very, very capital intensive, so to the extent that it's already so capital intensive, you don't want to be overbuilding infrastructure, because the more you overbuild, the harder it is for you to maintain that going forward.
But again, ultimately the answer to your question varies by municipality.