Progress Report on Amalgamation

The Strategic Policies and Priorities Committee recommends the adoption of the report (September 11, 1998) from the Chief Administrative Officer:

Purpose:

The purpose of this report is to update Council on the status of amalgamation of the administration that has been underway since the creation of the new City of Toronto on January 1, 1998 and to respond to related requests of Council.

Source of Funds:

There are no funding implications with respect to this report.

Recommendations:

It is recommended that the Chief Administrative Officer report back within six months, but no later than March, 1999, to the Strategic Policies and Priorities Committee on the progress of amalgamation within the Corporation.

Background:

City Council, at its meeting of February 4, 5 and 6, 1998, had before it a report entitled, "City of Toronto Administrative Structure," dated January 22, 1998, which outlined options for the departmental structure and the clustering of services for the new City. Council directed that "the Chief Administrative Officer report on a regular basis to the Strategic Policies and Priorities Committee on the progress of implementation of the administrative structure." Council also requested that the CAO report to the Special Committee to Review the Final Report of the Toronto Transition Team on progress reports, on the strategic directions secretariat, on the names of the service clusters, and on the title of positions below the Commissioner level.

Phased Approach to Amalgamation

At the February 4, 5 and 6, 1998, meeting of City Council, the report, "Strategic Restructuring Initiative" (January 19, 1998), outlined a three-phased approach to corporate restructuring for 1998.

Phase One was the establishment of the overall administrative structure of the new organization. This phase was completed with the adoption by Council of the creation of six departments to be headed by Commissioners reporting to the Chief Administrative Officer. The hiring of all Commissioners was completed by April, 1998.

Phase Two was the design of the internal organization of each department. The first component was the design of the main divisions and the creation of positions reporting directly to the Commissioner. The second component was the design of the sub-units within the divisions and creation of management positions below the Executive Director and General Manager level. Corporate organizational design guidelines were developed to ensure consistency across the Corporation while recognizing the need to allow sufficient flexibility to meet individual departments' needs. The design aspect of Phase Two will be completed by the fall of 1998 and hiring completed by early 1999.

Phase Three of the corporate restructuring process is the integration and rationalization of the municipal services previously provided by the seven former municipalities. This phase, which is in its initial stages, will examine opportunities for delivering services more efficiently and effectively, drawing on best practices elsewhere, exploring ways to reduce costs and to meet 1999 reduction targets. The initial analysis should be completed by the end of 1998 in order to prepare for the 1999 budget process.

The three-phased approach is outlined in Figure 1.

Process of Restructuring Departments

Amalgamation has been an enormous undertaking. The phased approach to amalgamation has provided a means to manage and coordinate this ambitious initiative. Three major issues underlie this approach. First, there has been the need to stabilize the new organization and establish a clear management accountability structure, as quickly as possible. Second, there has been the need to meet major cost reduction targets in 1998 and beyond. A 10% reduction in overall costs in amalgamating departments has been targeted as one of the critical outcomes of this process. Third, and most important, has been the need to continue to provide uninterrupted delivery of high quality municipal services through this period of uncertainty and major transition. This has required extraordinary effort on the part of staff in all areas, which should be recognized.

Significant staff effort has gone into the process and analysis for creating new departmental structures. The Amalgamation Office, within the CAO's Office, has had a lead role in marshalling internal and external resources, providing guidelines and frameworks for departments in carrying out their restructuring efforts, ensuring consistency across the corporation, identifying inter-departmental issues and linkages, tracking the corporate downsizing targets, developing a communications strategy and generally maintaining the impetus for administrative amalgamation.

Each department has appointed senior level Amalgamation Team Leads to oversee the restructuring effort and subsequent service rationalization phases. Departments have invited staff at various levels to provide input into the development of the vision and business goals for the department and how the department should most effectively be structured to achieve these goals.

External consulting firms have been engaged to complement internal resources assigned to departments and, particularly, to provide an outside, objective opinion on the organizational design proposals of departments based on their expertise and knowledge of best practices in other organizations within and outside of Canada. Council approved, at its meeting of April 29 and 30, 1998, funding of $2.5 million for external consultants to assist in the restructuring effort. To date, approximately $2.0 million has been expended on thirty projects involving ten consulting firms to assist in the organizational design of divisions. A more detailed breakdown on expenditures and work by external consultants will be forwarded in a separate report to the Budget Committee in October, 1998.

Many human resources initiatives have been undertaken to complement the restructuring effort. A major internal recruitment effort has been underway over the past five months to fill the new positions in the organization. All departments have been requested to develop downsizing plans to meet financial targets. Human resources policies have been developed to ensure fair and equitable recruitment processes, to address interim compensation issues, and to create employee exit plans that treat employees fairly while addressing the needs of the employer.

The overall goal of these efforts is to achieve an interim organizational structure that is well-thought out, that is the result of rigorous analysis, that includes staff in its development and that effectively meets customer and client needs. All this must be achieved within a fiscally sound framework. Corporate restructuring will be a continuing process over the next several years as the organization reviews its services and methods of operation in greater detail, and Council develops a vision for the City and makes fundamental policy decisions on major service delivery issues.

Status of Departmental Restructuring

The senior administrative structures for the six departments of the new City of Toronto are now complete (see Figure 2). In the majority of departments, the entire management structure is in place. However, in departments with the largest number of staff, or which began the process later, the structuring process is still underway but should be completed by the end of 1998.

This section briefly describes the status of restructuring in each department, as of September, 1998.

Finance Department

This department has a budget of $41 million and approximately 716 full time equivalent staff. The design of the management structure was finalized and approved by the CAO in June, 1998. The recruitment for all senior management positions was completed by July, 1998. ( Figure 3)

Urban Planning & Development Services

This department has a budget of $70 million and approximately 1,014 full time equivalent staff.

The management structure for the Buildings, Municipal Standards and Urban Planning Divisions was finalized and approved by the CAO in July, 1998. Recruitment is complete in the Buildings Division while the process is still underway in the other two Divisions. A review of the organizational structure of the Licencing Commission is currently underway. (Figure 4)

Community and Neighbourhood Services

This department has a budget of $2.4 billion and approximately 9,304 full time equivalent staff. The amalgamating components of this department are Public Health, Toronto Public Library and Housing. The organizational design for Public Health was finalized and approved by the beginning of June and senior management appointments completed in July, 1998. The organizational structure for the Toronto Public Library was finalized and approved in July, 1998. All senior management positions are now in place. The Housing Division is currently in the process of developing an organizational structure. (Figure 5)

Works and Emergency Services

This department has a budget of $1.1 billion and approximately 9,420 full time equivalent staff. The organizational designs for the Solid Waste, Technical Services, Transportation, and Water and Wastewater Divisions were finalized and approved by the CAO in July, 1998. All senior management positions are in place, and work is continuing on the design of the rest of these divisions as well as the recruitment process. Recruitment at various management levels of Fire Services is completed. Ambulance Services is an amalgamated service but structures may change as a result of Phase Three work, would would be reported on further to Council. (Figure 6)

Corporate Services

This department has a budget of $237 million and approximately 2,528 full time equivalent staff. Organizational designs for audit services, city clerk's, communications, facilities and real estate, fleet, human resources, information technology and legal services have been finalized and approved by the CAO over the last several months with the final division approved in September, 1998. The senior management structure of this department is now complete and most senior management positions have been filled. Recruitment continues at other management levels in the various divisions. (Figure 7)

Economic Development, Culture & Tourism

This department has a budget of $240 million and approximately 3,963 full time equivalent staff. The delayed hiring for the Commissioner's position, until April, 1998, has resulted in this department lagging behind the others in finalizing its organizational design. However, the organizational design for the senior management structures of five of its six divisions - Administration and Support, Economic Development, Parks and Recreation, Policy and Development, and Special Events - was finalized and approved by the CAO in August, 1998, and recruitment is underway. The organizational design of the Culture Division is awaiting the final resolution of the governance issue regarding Heritage Toronto. (Figure 8)

Corporate Management Framework

While restructuring has been a major priority of the organization, other related initiatives have also been underway as the organization moves from Phase Two to Phase Three. The corporate management framework is intended to provide an overall context within which major change will take place within the organization over the next several years. This framework was outlined in the report, "Corporate Management Framework" (April 27, 1998), which was approved at the Council meeting of May 13, 1998. The four key elements of the framework are:

(a)Creation of a broad Council vision for the community through the development of a strategic plan

(b)Development of multi-year program plans to implement the strategic plan and define departmental service objectives and capital investments

(c)Development of annual budget plans to operationalize program plans, set annual services levels, approve capital projects and define performance expectations

(d)Introduction of individual performance standards linked to defined objectives and measures of success

Work is underway in all four areas. In particular, it should be noted that a report on a terms of reference for a strategic planning process will be before the Strategic Policies and Priorities Committee meeting of September 24^th, 1998.

Senior staff have already begun to engage in a discussion of corporate values and aspirations. Some emerging themes include:

(a)ensuring a high quality of life for citizens through the provision of quality, customer driven services, which result in high levels of satisfaction

(b)having a reputation for innovation and leadership in the municipal sector

(c)being an employer of choice and one that communicates effectively and openly at all levels both internally and externally

(d)being a fiscally prudent organization, one that plans actively and with a long term view.

These are preliminary directions which will be refined and elaborated on further through engaging staff at all levels in the organization and by linking up with Council's vision for the City.

Service Integration and Rationalization

As part of Phase Three, major departmental initiatives are underway to integrate the services of the seven former municipalities. City Council, at its meetings on July 8 and July 29, 1998, approved a series of major one-time transition projects to assist the City in moving towards an integrated and streamlined set of services. Council approved thirty-two transition projects at a total 1998 cost of $36,652,000.00.

As one of the transition projects, Council also approved $2.5 million for departments seeking external assistance for specific service rationalization initiatives. A key criteria for approval of projects is that they must show a significant return on investment. To date, twenty projects in four departments have been approved.

Major projects are also underway with respect to:

(a)the harmonization of user fees (as first discussed in a report before City Council at its meeting of June 3, 1998)

(b)7service level reviews (which will be before the September 24, 1998, meeting of the Strategic Policies and Priorities Committee)

(c)alternate service delivery approaches

(d)restructuring the delivery of internal support services

(e)developing a space planning strategy, including the role of the six civic centres.

All of the above initiatives have major policy implications. All policy issues will be brought before the appropriate committee and Council for direction and final decision.

Communications

An important element of amalgamation is to ensure effective communications to Council, to employees and to the public. Given the rapid pace of change, this is a particularly challenging aspect of the amalgamation effort.

To date, the first two of a planned series of Councillor briefings have been convened to which all members of Council were invited, to provide an update on the progress of amalgamation. These briefing sessions will continue over the coming months. In addition, there have been monthly updates which will also continue. A Council Panel has been set up to oversee the use of external consulting assistance. This Panel has met at various times this year. Progress reports to Council will continue. I am recommending that the next report be within the next six months but no later than March, 1999.

Given the significant movement of staff within the former municipalities, key staff contacts which individual Councillors have in the past dealt with may no longer be available. Council can be assured that services are continuing but it is recognized that these changes impact on members of Council in trying to respond to individual citizens' inquiries and to address community council issues. Every effort is being made by departments to ensure that key contact names are available to members of Council. The decentralized service delivery model in the major operating departments, through the creation of service districts, is focused on ensuring the appropriate delivery of services at the community level. As the organization stabilizes and positions are filled, the issue of key contacts should diminish. Staff know that this is a matter of concern and will continue to monitor the situation.

An extensive effort has also been underway to keep employees at all levels in the organization informed about changes as they occur. A monthly employee newsletter, Inside Toronto, has been set up since the beginning of this year. Departmental newsletters have also been created. A communications liaison has been assigned to each department. The CAO and Commissioners have had a series of meetings with staff of the former municipalities to advise them of the progress of administrative amalgamation and to respond to questions. The CAO and Commissioners have also visited a number of work locations to see operations at first hand and to answer questions from staff.

A comprehensive communications approach for the new City has been developed with the assistance of external consultants. Implementation of the strategy will be the responsibility of the Communications Division.

Council, staff and the public need to know what the organization has accomplished over the past number of months during this time of major transition. A list of key accomplishments was circulated to Councillors and staff in June (see Appendix).

Other Issues

There are various directives of Council resulting from its meeting of February 4, 5 and 6, 1998, concerning the role and function of the Strategic Directions Secretariat, the names of service clusters and linkages, and the issue of job titles, which are addressed below.

Strategic Directions Secretariat

The Final Report of the Toronto Transition Team recommended the creation of a Strategic Directions Secretariat, reporting to the CAO, to coordinate the amalgamation effort, to address inter-governmental and inter-sectoral issues and to promote a corporate perspective on Toronto as a healthy city. All these matters are currently being addressed and coordinated in the CAO's Office.

Initial organizational design work has been completed regarding the corporate policy functions and the Director position has been filled. Work is continuing on the role of the office and the functions that it will perform. This will include matters such as strategic planning, healthy city monitoring, intergovernmental coordination and corporate performance tracking. The CAO has also established an interdepartmental committee on the environment and is reviewing opportunities for similar cross-departmental teams to address key areas.

The Transition Team's Final Report also recommended the creation of the Office of Economic Development in the CAO's Office. Given the scope, magnitude and importance of economic development to the future health and well-being of the community, Council's decision has been to place this important function within the Economic Development, Culture and Tourism Department. This results in its integration with related activities as well as ensuring that significant senior management resources are in place to manage this critical function. Its importance is further highlighted by Council's decision to create a standing committee on economic development.

Service Cluster Names/Linkages

The Special Committee to Review the Final Report of the Toronto Transition Team requested the CAO to report on any suggested changes to the names of service clusters (i.e. departments) and title of Commissioners. All Commissioners have been requested to review this request and to forward any proposed changes for discussion by the Senior Management Team this month. Any proposed changes will be forwarded to the Special Committee in October, 1998, for consideration.

City Council also requested that the issue of linkages and improvements between departments be addressed, particularly with respect to recreational programs for high needs communities. A discussion paper has been prepared by the Economic Development, Culture and Tourism Department, which is before the September 18^th, 1998, meeting of the Economic Development Committee, outlining key issues and opportunities in the department. The report recognizes the need to build linkages to other departments in the planning and delivery of services. This issue will continue to be monitored.

Job Titles

City Council, at its meeting of February 4,5 and 6, 1998, requested the CAO to review the titles used for positions below the Commissioner level, including the use of the title, "Commissioner," and to report back to the Special Committee. A consulting firm specializing in compensation matters has been commissioned to review all aspects of job descriptions and compensation within the new organization. Its terms of reference encompass the requests described above. This study will be completed early in 1999. Recommendations arising from the study will be forwarded to Council for consideration.

Conclusion:

Significant progress has been made over the past nine months on the administrative amalgamation of the seven former municipalities into a unified City of Toronto. The management restructuring process is completed or near completion in all departments. Major initiatives are underway in a number of areas related to the integration and rationalization of services. The findings and recommendations of these projects will have significant policy implications which will need to be addressed by Council over the coming year.

City Council, the Strategic Policies and Priorities Committee and the Special Committee to Review the Final Report of the Toronto Transition Team had directed staff to provide various progress reports on amalgamation to these committees. In order to simplify and coordinate the presentation of these progress reports, it is instead recommended that the next report be forwarded to the Strategic Policies and Priorities Committee within six months but no later than March, 1999.

Contact Names:

Brenda Glover, Executive Director, Human Resources and Amalgamation, 397-9802

Roda Contractor, Senior Policy Advisor, Amalgamation Office, 397-0459

(Memorandum dated June 24, 1998, addressed

to Members of Council, from the Chief Administrative Officer)

At my request, staff from all the departments have been compiling a list of achievements in the City's first 150 days. I am pleased to provide to you a copy of those accomplishments that you may wish to refer to when speaking with your constituents.

As I scan this list I feel a great deal of pride in what we have all been able to accomplish - with Council and staff working together in our first six months.

On behalf of all staff I would like to thank you for your support and thoughtful direction to date. We look forward to continuing to build a positive and productive relationship with Council.

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150 Day Departmental Success Stories

We are half way through our first year as a unified City of Toronto and we have accomplished so much in such a short time together! Here are highlights of our accomplishments in our first six months:

Corporately,

(i)an operating budget with no increases in taxes was delivered on time and was adopted by Council in April;

(ii)a senior management team comprised of the CAO and six Commissioners was confirmed by Council;

(iii)a strategy to combine seven municipaliites into one was developed, external consultants hired and amalgamation teams established;

(iv)the organizational structure was established and 80 per cent of the staff who lead the divisions have been hired;

(v)a reduction of 1278 staff has been identified and is on tartget;

(vi)key human resources strategies for the new organization were approved by Council;

(vii)Council approved a new logo for the City;

(viii)a centralized one-number call centre for general inquiries to the City was put in operation and now handles an average 4000 per week;

(ix)"Our City booklet was distributed to every household in the City;

(x)more than 1000 proclamations and letters of greetings were sent to residents and businesses;

(xi)a City of Toronto Web site was developed and now receives up to 7000 "hits" a day;

(xii)Council selected City Hall as the seat of government and approved plans for renovations;

(xiii)all former civic centres have been linked electronically;

(xiv)more than 50 Council and Community Council meetings and over 130 committee meetings were held;

(xv)almost 500 applications from citizens for positions on Boards and Commissions have been received;

(xvi)a smog alert response plan for the City was developed, approved by Council and implemented for the first time on June 25;

(xvii)a surplus property disposal project with the objective of raising $60 million in additional revenue was implemented;

(xviii)a corporate plan for dealing with the year 2000 problem was developed.

In the area of Community and Neighbourhood Services,

(i)Council appointed a Children's Advocate and established a Children's Action Committee;

(ii)a strategy to fund additional child care for Ontario Works from welfare savings was developed;

(iii)an average of 4,183 people were assisted by Hostel Services per night;

(iv)community grants programs were consolidated and funding to agencies maintained;

(v)an average of 84,764 social assistance cases were served each month;

(vi)40,434 social assistance cases were helped to become independent of social assistance;

(vii)Council established a Strategy Committee fo People Without Homes and an Action Task Force on Homelessness;

(viii)Library Answerline was established, a city-wide library policy for circulation and fees approved, and more than 11.4 million items are now in circulation;

(ix)a city-wide Healthy Babies, Healthy Children program was established;

(x)an additional $1.2 million in funding was secured for the Child Nutrition programs that serve more than 30,000 children in 240 schools and community locations;

(xi)a Parents Helping Parents program was established and is set for a July 1 launch;

(xii)community grants programs were consolidated and funding to agencies maintained.

In the area of Economic Development, Culture and Tourism,

(i)A successful Winter Carnival was held in February and Celebrate Toronto Street Festival is set for July 1;

(ii)A Millennium Task Force has been established;

(iii)Council and Canadian Olympic Association approval was obtained for Toronto's bid for 2008 Olympics;

(iv)a Youth Employment Summit was held in April.

In the area of Planning and Urban Development Services,

(i)a uniform building permit bylaw was approved by Council;

(ii)standardized fees for building permits and planning applications were introduced;

(iii)several important bylaws have been consolidated for Council's approval;

(iv)the process to develop a new Official Plan for Toronto was approved by Council and is underway

(v)Work began on the Yonge/Dundas redevelopment project as soon as approval to proceed was received by the OMB;

(vi)Numerous major development projects are now underway such as Downsview, the Railway Lands Settlement, and the Air Canada Centre among others;

(vii)a review of the taxi cab industry is underway;

In the area of Finance,

(i)A $ 50 million grant and $ 100 million loan to offset transition costs were secured from the Province;

(ii)A contract for consolidated banking services, which will save more that $400,00.00 annually was approved by Council;

(iii)Standardized due dates, a convenient pre-authorized tax payment program and standardized administrative service charges related to property taxes have been approved

(iv)The majority of the City's insurance program has been consolidated at a cost saving of $4.9 million, or 54 per cent from 1997 costs;

(v)Information about business opportunities (request for proposals) is now available on-line through the City's Internet site.

In the area of Works and Emergency Services,

(i)Fire and Ambulance Services are now headquartered at 4330 Dufferin Street;

(ii)$8 million was secured from the Province to fund the City's Ambulance Communications Centre;

(iii)Breaking down the geographic boundaries of the former municipalities has resulted in initial savings of resources in the area of roads maintenance and waste collection, with additional savings expected as amalgamation proceeds;

(iv)a coordinated winter maintenance status reporting system was implemented resulting in better equipment and manpower allocation during snow storms;

(v)Environment Days have been, and continue to be held and clean-up days have been organized citywide;

(vi)a new computer aided dispatch system for ambulance services was installed;

(vii)a new fire command system that replaces the six former command systems is now in place;

(viii)Alarmed for Life, a residential smoke detector inspection program, has been implemented.