Review of the Reporting Relationship of the

Design Exchange to the City

The Economic Development Committee recommends that the following two members of the Economic Development Committee be appointed to the Design Exchange Board of Directors for the period ending November 30, 2000, and until their successors are appointed:

-Councillor Faubert; and

-Councillor Silva.

The Committee reports, for the information of Council, having requested the Design Exchange to report annually to the Economic Development Committee on its activities.

The Economic Development Committee submits the following report (May 6, 1999) from the Commissioner of Economic Development, Culture and Tourism:

Purpose:

To review the reporting relationship of the Design Exchange (DX) to the City of Toronto, and to appoint two City Councillors to sit on the Design Exchange Board, and that such persons be appointed for the period ending November 30, 2000, or until their successors are appointed.

Funding Sources, Financial Implications and Impact Statement:

There are no financial implications associated with this report. Operating funding for the DX is provided by the City of Toronto as sublandlord from funds received from Cadillac Fairview. Additional funding for specific projects has been provided to the DX from time to time by the former City of Toronto, municipality of Metropolitan Toronto and the Toronto Arts Council. No new funds are being requested at this time.

Recommendation:

It is recommended that Council appoint two members of the Economic Development Committee to sit on the Design Exchange Board for a period ending on November 30, 2000, or until their successors are appointed.

Council Reference:

At its meeting on April 23, 1999 in response to a letter from Councillor Silva, the Economic Development Committee requested that staff report back on the reporting relationship of the Design Exchange to the City of Toronto.

Comments and/or Discussion and/or Justification:

The Design Exchange (DX) is North America's premier centre for design and innovation. DX is a not-for-profit, educational organization committed to promoting design and innovation in Canada as tools to increase economic growth and improve quality of life. This is done by showcasing new and innovative Canadian design; presenting Canadian and international design expositions; serving as a venue for product launches; hosting seminars, conferences and lectures; as well as acting as a resource for the design, education and business communities, and the general public. DX is one of 23 major design centres around the world and the first of its kind in North America. The Design Exchange does not design products and services, but acts as resource centre and as a liaison to a variety of design resources.

The Design Exchange opened in 1994 in the former Toronto Stock Exchange Building at 234 Bay Street. Its vision is to strengthen cultural identity and create wealth in the economy by fostering a demand for sustainable Canadian design. The mission of the DX is to:

-raise public awareness and understanding of the essence of design and its importance in building Canada's cultural identity and shaping its future; and to

-increase the number of Canadian designed and produced products and services that are globally competitive.

The former City of Toronto played an important role in making the idea of the design exchange a reality. Toronto secured the building for the Design Exchange when it approved the commercial development on the former stock exchange site. It also required that the developer provide $500,000 a year for 24 years for the benefit of the premises. The City funded the initial feasibility study for the Exchange, and worked with the Board over the years to meet the many challenges that were involved in bringing the project to fruition. City staff have been seconded to work with the organization on major projects in the past, and could be in the future, as is the practice with other design centres around the world.

The Design Exchange sublets their space from the City of Toronto, according to an agreement which runs from December 1, 1994 to May 20, 2091. The agreement with the developer allows the City to receive payments from the developer for the use and benefit of the occupant of the premises, in such a manner as the City shall determine. As of January 1, 1996, the City entered into a 5-year grant agreement with the DX, allowing them to receive the developer's contributions from the City. The agreement is supported by the DX's five-year strategic plan that was submitted to the City in the same year. The grant agreement will expire on December 31, 2000, and a new agreement will be brought forward for approval by City Council.

The City has established a reserve fund for expenditures and extraordinary repairs and maintenance, a holdback from the developer's annual payments. It will increase each year from $10,000 in 1996 to $30,000 in the year 2000. In the past the DX has received grants from the former City of Toronto, Metro, and the Toronto Arts Council for particular projects, such as support for ICSID '97 The Humane Village Congress, attended by over 1,000 international designers and business leaders from over 44 countries. However, the majority of the operating budget of the Design Exchange is raised through its programming and facilities rentals.

According to the Design Exchange Grant Agreement dated November 27, 1995, the Board of Directors "¼shall have no less than 15 and no more than 35 members. The City shall have the right to nominate two representatives to the board..."

There are 19 members on the DX Board of Directors, including Councillor Mario Silva who has indicated an interest in remaining on the Board. The Design Exchange is currently in the process of reconstituting its Board. As a result, the DX has requested that the City confirm its appointments to the Board until the end of the current term of City Council.

Conclusions:

The Design Exchange is an internationally recognized centre for design and innovation, located in Toronto. The first design centre of its kind in North America, it works with corporations, designers and educators across the country, helping to generate greater profits for business and create employment in the City's knowledge-based industries. The City of Toronto played an important role in the creation of the organization within this significant facility, and should continue to maintain a strong presence on the Board.

Contact Name:

Brenda LibreczLaurie Belzak

Managing DirectorSector Development Officer

Economic DevelopmentEconomic Development

397-4700392-1296

Bruce GrahamEva Pyatt

Director, Business Development & Retention Manager, Sector & Strategic Partnerships

Economic DevelopmentEconomic Development

392-3381392-3378

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The following persons appeared before the Economic Development Committee in connection with the foregoing matter:

-Luigi Ferrara, Vice President, Business and Public Programs and Services, The Design Exchange; and

-Lynda Friendly, The Design Exchange.