Funding of Additional Capital Projects for Transportation

 The Strategic Policies and Priorities Committee recommends the adoption of the recommendation in the following transmittal letter (July 14, 1998) from the Budget Committee:

 Recommendation:

 The Budget Committee on July 13, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, that the uncommitted revenue from the sale of property assets be used to fund the additional $9.103 million for the 1998 Capital Program for Transportation approved by City Council on April 29 and 30, 1998.

 The Budget Committee reports having:

 (a)referred the joint report (June 22, 1998) from the Chief Administrative Officer and the Commissioner of Corporate Services to the Corporate Services Committee for information; and

 (b)received the memorandum (July 6, 1998) from Councillor Jack Layton, Don River.

 Background:

 The Budget Committee on July 13, 1998, had before it the following:

 (a)joint report (June 22, 1998) from the Chief Administrative Officer and the Commissioner of Corporate Services providing information about the proceeds from the sale of City-owned property;

 (b)transmittal letter (May 8, 1998) from the City Clerk advising that City Council approved additional funds for transportation projects and requesting the Budget Committee to report on the source of the additional $9.103 million possibly from the projected sale of major assets;

 (c)report (May 25, 1998) from the Chief Financial Officer and Treasurer identifying the source of funding for the additional $9.103 million approved by Council; and

 (d)memorandum (July 6, 1998) from Councillor Jack Layton regarding the proceeds from the sale of properties.

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 (Joint report dated June 22, 1998, addressed to the

Budget Committee from the

Chief Administrative Officer and the Commissioner of Corporate Services)

 Purpose:

 To respond to requests from the Budget Committee for information about the proceeds from sale of City owned property.

 Source of Funds:

 Not applicable.

 Recommendation:

 It is recommended that this report be referred to the Corporate Services Committee for information.

 Council Reference/Background/History:

 At its meeting of May 26, 1998, the Budget Committee had before it a report from the Commissioner of Corporate Services, "Expediting the Sale of Property and Reduction of Leased Space", dated May 11, 1998. Among other things the Committee requested:

(1)the Commissioner of Corporate Services to report to the next Budget Committee on:

 (i)the saleability of the subject properties and the process to be implemented with regard to the disposition of City-owned land;

(ii)those properties where the proceeds from the sale of the properties are required to go back to a specific reserve or to be allocated for a specific purpose as a result of previous Council policies;

 (2)the Chief Administrative Officer to report to the next meeting of the Budget Committee:

 (i)on those properties which the Budget Committee can count on being sold this year and the expected closing dates; and

(ii)as to whether there are any reserves or liens on these properties.

 This report provides information on the above requests.

 Comments:

 (1)Saleability of the surplus properties and the process for considering disposition:

 The City's surplus properties contain a wide range of property types in varying conditions. The list, which has been updated for this report, in Appendix A includes:

 53 houses in the Spadina Corridor;

19 small remnant parcels in the Spadina Corridor of interest only to abutting property owners from whom the parcels were severed;

19 houses in the Scarborough Corridor;

49 parcels of vacant land; and

2 industrial, 1 industrial office space, 1 playground, 3 commercial, and 2 office properties.

 The saleability of a property depends on the market demand for the type of property, its location, and its potential, and will be reduced by conditions such as contamination, existing leases or oversupply of the property type. Real estate staff of the various former municipalities develop appropriate strategies for the sale of each property, taking into consideration recent sales in the area for the property type.

 Properties that have already been declared surplus are being reviewed by Councillors and staff and some properties, such as the former Mimico Incinerator site, may be reconsidered for other uses.

 The processes for considering whether a property should be declared surplus by City Council are set out in the report to the Corporate Services Committee from the Commissioner of Corporate Services dated May 11, 1998 "Acquisition and Disposal of Real Property" . The process includes review by the new senior staff Property Management Committee. The May 11, 1998 reports "Surplus Property within the "Spadina Corridor" and "Scarborough Transportation Corridor"and "Sale of "Property Houses" (houses in the former City of Toronto originally acquired for parks purposes but operated by Cityhome) establish special processes for the sale of these groups of residential properties, including those that are currently tenanted.

 (2)Properties where the proceeds from the sale are required to go back to a specific reserve or allocated for a specific purpose as a result of previous Council decisions and policies:

 The list in Appendix A includes lists of properties sold this year, sales in progress and surplus properties that may be sold this year, along with any specific allocation for a specific purpose or reserve fund of a former municipality. Sales completed to date this year and sales in progress are primarily a result of sales approved by former municipalities and allocations are to the reserve funds of the former municipalities.

 The allocations for the properties sold this year and for sales in progress were for the following types of special reserves:

 (a)parks purposes;

(b)social housing;

(c)environmental remediation for former Harbour Commission properties; and

(d)the general land reserve accounts of the former municipalities.

 It should be noted that City Council, at its meeting of April 29 and 30, 1998, adopted Clause 12 of Report 6 of the Strategic Policies and Priorities Committee, which contained the report of the Chief Financial Officer and Treasurer. The report established new reserve funds into which the funds of the previous municipalities have been collapsed. These include the Discretionary Land Acquisition Reserve Fund, Other Discretionary Reserve Funds (including social housing and environmental remediation) and a Non Discretionary Parkland Acquisition Reserve Fund.

 For the purpose of this report, the allocations to reserve accounts are grouped in the chart below. The charts reflect the situation as of June 15, 1998, so that City Council approvals for the sale of a property at the June 3 and 4 meeting are included in the list of sales in process. With respect to the Spadina Corridor houses, the charts do not show the share of revenues allocated to the Province, which is one third of the total revenue.

 Allocation to Reserves: Properties Sold in 1998 to Date and Properties with Sales in Process

  Therefore, the total revenues from completed sales and sales in progress that are forecast to be received in 1998 by the City are $23,457,189.00. The net unallocated proceeds available for other purposes at this time are $8,118,265.00.

 In addition, there will be revenue from the sale of additional properties already declared surplus. The former City Councils and City Council have approved the future allocations of revenues for some properties yet to be sold. As appraisals have not been done on these properties, no revenue amounts can be listed at this time.

 Approved Allocation of Revenue from Future Sales

 PropertyWardAllocation

 Everett Cr1Parks Dedication Fund

116 Combe8Parkland Development

180 Duncan Mill11Land Acquisition

Centennial Rd16Land Development

6520 Lawrence16Land Development

80 Turnberry21Expropriation of 11R Hounslow Heath

30 St. Lawrence 25Social Housing

877 Woodbine26Social Housing - landbanking

(3)Properties that the Budget Committee can count on being sold this year:

 Appendix A sets out the list of properties already sold this year or sold with closing dates established for this year. Closing dates will be established for additional properties on the list, and there will be additional sales and closings if additional properties are declared surplus, including:

 (1)revenue from the sale of the property houses, as set out in the report, "Sale of Property Houses", which recommends that a number of houses be declared surplus and sold; and

 (2)revenue from the sale of additional properties that will be declared surplus this year, provided there is sufficient time for the sale and closing. It is anticipated that a report will be submitted to the Corporate Services Committee for its July meeting to recommend a list of properties to be declared surplus by City Council at its meeting in July.

 It should be noted that the October 1 meeting is the latest date for Council approval of most types of sales so that the closing can occur in 1998. As unforseen issues can arise, the completion of a sale cannot be guaranteed to occur by a specific date.

 Conclusions:

 Detailed information about sales completed in 1998, sales in process, and surplus property that will potentially be sold is included in the Appendix of this report, and information is provided on these lists about allocation of funds where this has been previously approved. The planned hiring of the Project Director, Real Estate Disposal, will augment existing staff resources to expedite disposal of property.

 Contact Name:

 Cathie Macdonald, Interim Lead, Facilities & Real Estate, phone 392-0449, fax 392-0029 (bc98100.wpd).

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 Appendices

 Property Lists

 Appendix A - Report of Properties Sold in 1998 as of June 15

Appendix B - Report of 1998 Sales in Progress

Appendix C - Report of Properties Declared Surplus by Former Municipalities and the new City of Toronto: Work in Progress

 Please note Spadina Corridor, Spadina Corridor Rear Lot Remnants and Scarborough Corridor Properties:

 2/3 of revenue generated to the City, 1/3 of revenue generated to the Province - until $30 million is reached. After $30 million, the split is 50/50. Agreement was reached with the Province to charge against the ORC portion the costs of the sale (ie. Appraisals, surveys, etc.)

 Attached is an abbreviations list for Property Types and Property Status to be used with the Appendices.

(Transmittal letter dated May 8, 1998, addressed to the

Budget Committee from the

City Clerk)

 City Council, at its Special Meeting held on April 29 and 30, 1998, in adopting the 1998 Operating and Capital Budgets, directed, inter alia, that the 1998 Capital Program, pertaining to the Transportation Program, be amended, in principle, by adding funds for:

 (1)Bridge Construction$ 1,530,000.00

(2)F.G. Gardiner Expressway$ 2,000,000.00

(5)Bridge Reconstruction$ 1,350,000.00

(6)Road Resurfacing$ 3,323,000.00

(7)Traffic Control$ 400,000.00

(9)Safety and Operational Improvements$ 500,000.00

 Total$ 9,130,000.00;

 and further that the Budget Committee be requested to report to City Council on June 3, 1998, on the source of the additional $9,103,000.00 for the 1998 Capital Program for Transportation, possibly from the projected sale of major assets.

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 (Report dated May 25, 1998, addressed to the

Budget Committee from the

Chief Financial Officer and Treasurer)

 Purpose:

 To identify the source of funding of the additional $9.103 million approved by Council in the Transportation capital budget.

 Funding Sources, Financial Implications and Impact Statement:

 The projects are to be funded as indicated below.

 Recommendations:

 It is recommended that the uncommitted revenue from the sale of property assets be used to fund the additional $9.103 million approved by Council.

 Background:

 In clause 2 of the agenda before Budget Committee today, is a report addressing the programs under way to expedite the disposal of land and reduction of leases. Out of the total anticipated proceeds, the Commissioner of Corporate Services has identified, in a memorandum to the CAO, the specific uncommitted revenues that could be made available to fund the additional Transportation capital projects of $9.103 million approved by Council. (Copy of the memorandum is attached).

 Comments:

 Council, in approving the 1998 capital budget for Transportation, amended the proposed Transportation budget by $9.103 million for the following projects, in order of priority:

 $ million

 (1)Bridge Construction $ 1.530

(2)F.G. Gardiner Expressway$ 2.000

(3)Bridge Construction$ 1.350

(4)Road Resurfacing$ 3.323

(5)Traffic Control$ 0.400

(6)Safety and Operational Improvement$ 0.500

 Total$ 9.103

 The specific work to be undertaken, as identified by the Transportation department, is as follows:

 (1)Bridge construction on York Mills road from the Don river to east of Don Mills Road and the W.R. Allen Underpass at Elm Ridge drive, both at an estimated gross cost of $1.53 million (project : City No. 055);

 (2)F.G.Gardiner Expressway bent repair and rehabilitation of the supporting columns from Jarvis Street to Cherry Street at an estimated cost of $2.0 million (project: City No. 180);

 (3)Bridge construction on Lawrence Avenue West from the Humber River to east of Scarlett Road at an estimated cost of $1.35 million (project: City No. 055);

 (4)Road resurfacing at 4 locations (project: City No. 396);

 (5)Traffic Control which includes $100 thousand for the installation of audible signals and $300 thousand for the replacement and/or upgrade of old traffic plant. (projects: City No. 037 and No. 031); and

 (6)Safety and Operational improvement includes miscellaneous works to improve the pedestrian and vehicular safety on arterial roads (project: City No. 380).

 The historical spending pattern, on a gross basis, over the last five years, from 1993 to 1997, is an average of $85.1 million. On a comparable basis, the 1998 approved estimate for city wide projects is $77.3 million on a gross basis which is $7.8 million lower than the five year historical spending average. Excluding projects funded under the Federal Provincial Municipal (FPM) program and more recently, in 1997, the Canada Ontario Infrastructure Works (COIW) program this average is reduced to $69.7 million on a gross basis. The 1998 approved city wide estimate is $7.6 million higher than this average.

 The 1998 estimate of $77.3 million includes an amount $33.0 million solely on the Humber bridges project approved by the former Metro Council in 1997. This leaves only $44.3 million for all other city wide projects. Given the previous spending average of $85.1 million gross annually, as indicated above, combined with the commitment of $33.0 million for Humber bridges, it is anticipated that the department will not experience any significant under expenditure in the program.

 Conclusions:

 This report identifies the funding of the additional $9.103 million approved in the Transportation capital program and provides background information on the historical spending patterns of the program to assess overall reasonableness of the additional amounts approved.

 Contact Name:

 Shekhar Prasad, 392-8095, Fax 392-3649, Internet: shekhar_prasad@metrodesk.metrotor.on.ca.

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 (Memorandum dated May 24, 1998, addressed to the

Chief Administrative Officer from the

Commissioner of Corporate Services)

 See attached lists.

 Revenue from properties sold in 1998 and closed and not previously allocated$1.56 million

 Revenue from Spadina houses sold (assuming City retains half the revenue)$1.60 million

 Revenue anticipated from sales in progress where not previously allocated$5.50 million

 Revenue from identified sales approved by the Corporate Services Committee$5.90 million

or being resolved to report to next meeting and not allocated

(114 Coombe, 23 Fraser, 171 Strathearn, 20 Sudbury, 2/s Avonmore Square, 530 Woburn)

TOTAL$10.56 million

  In addition 2 land leases are in the process of being sold$18 to 21 million

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 (Memorandum dated July 6, 1998, addressed to the

Budget Committee from

Councillor Layton)

 Recommendations:

 It is recommended that:

 (1)that City staff be directed to delay the sale surplus properties identified below for a period of 75 days;

 (2)that the Council Strategy Committee for People Without Homes report to the next Budget Committee meeting on the following:

 (a)the properties identified for potential affordable housing purposes and the rational used in the identification process

 (b)a business plan for the utilization of these properties including:

 (i)type of project being contemplated for each site;

(ii)funding mechanisms to be used in development;

(iii)potential end users;

(iv)timelines for expeditious development; and

(v)opportunity costs to the City for the targeted use of each property.

 Background:

 The report provides information on progress on the sale of City-owned properties that have been declared surplus. Most of the surplus designations were established under protocols of the former municipalities and Metro government. As such, properties currently being marketed have not been reviewed for their potential use in meeting key corporate objectives pursuant to directives established by new City Council. Specifically, Council has directed that the Council Strategy Committee for People without Homes be given an opportunity for input into the process of property disposition.

 The Council Strategy Committee for People without homes and several other City Committees are reviewing innovative approaches used in other municipalities to meet the housing needs of lower income people. These include the following:

 (a)low income ownership programs in New York City and Windsor, Ontario;

(b)multi-unit residential development by groups like Habitat for Humanity; and

(c)municipal programs encouraging the private development of Single Room Occupancy Hotels in Vancouver and San Diego, California

 The key common denominator in all of these approaches has been the targeted use of City land resources. While in certain cases (especially in projects for the homeless) the municipalities under review have not received full market value for their property, in many instances cities have been able to achieve full value while still leveraging the development of new, permanently-affordable housing.

 In the future, the review of properties by the Council Strategy Committee will ensure that lands are evaluated for their potential to meet housing needs prior to their final disposition by the City. However, a number of properties currently in the City's surplus portfolio have not been subject to this review and may be among the most suitable for affordable housing.

 The Advisory Committee on Homeless and Socially Isolated Persons is establishing a panel made up of City staff and experts in the community to evaluate the City-owned properties for their potential use for innovative affordable housing. form a preliminary review of the current portfolio of surplus properties, it appears that at least 15 sites have potential for meeting affordable housing objectives while still generating revenue sales.

 Potential Sites for Affordable Housing (preliminary list)