Ford is free to "upgrade" whatever portion of TC he likes. But since he can't simply will money from other levels of government into existence, he'll have to fund it by raising taxes: property taxes, vehicle registration taxes, parking taxes, road tolls, and all those other things that he's against.
Contrary to your assertion, there's no magical pot of City money just waiting to fuel people's fantasy lines. Cancelling parts of TC will have significant money-wasting consequences. It really is TC or nothing, at least within the next 10 years. And unfortunately, Ford seems to be making it quite clear that he prefers nothing.
Also: People on these threads keep asking why the TTC is so underdeveloped. The answer should be obvious: lack of funding and excessive political interference. This will be the second time in the last 15 years that a conservative politician has killed a multi-billion dollar transit expansion in Toronto. The fact is that the windows of opportunity when governments (a) have sufficient funds to invest, and (b) are comprised of transit-friendly political leanings, are probably both short and rare.
Faux Tea Partiers like Ford and Hudak are certainly not going to be funding multibillion dollar downtown subway expansions, since any money that could be used for them will inevitably be eaten up by tax cuts.