Toronto's contract to spend $1 billion on streetcars to be made in Thunder Bay has hit a snag.

Premier Dalton McGuinty says they haven't budgeted for their portion of Toronto's $1.2 - billion deal for Bombardier streetcars.

He says the province has already come across with $9 - billion for Metrolinx's transit plan in the Toronto area.

The premier is surprised Toronto now wants them to pick up one-third of the cost of new streetcars and says he has to talk with Ottawa about their one-third share.