Application for Approval to Expropriate Further Interests

in Land, Sheppard Subway Project - Twin Tunnels

1333 Sheppard Avenue East Holdings Limited

Leslie Street and Sheppard Avenue East

(Ward 12 - Seneca Heights)

The Administration Committee recommends the adoption of the following report (July 19, 1999) from the City Solicitor; and reports having requested the City Solicitor to submit a report directly to Council for its meeting scheduled to be held on July 27, 1999, providing additional information on the financial costs that may be incurred:

Purpose:

To authorize the initiation of expropriation proceedings for further temporary surface and subsurface interests, in the vicinity of the intersection of Leslie Street and Sheppard Avenue East, required for the construction of the Sheppard Subway Project.

Funding Sources, Financial Implications and Impact Statement:

Financing has previously been approved by Council and is available in Capital Account No. TC-392, Sheppard Subway Project.

Recommendations:

It is recommended that:

(1)authority be granted to initiate the expropriation process for the property interests detailed herein;

(2)authority be granted to serve and publish Notices of Applications for Approval to Expropriate property interests herein detailed, to forward to the Chief Inquiry Officer any requests for hearings that are received and to report the Inquiry Officer's recommendations to Council for its consideration; and

(3)the appropriate City officials be authorized and directed to take the necessary action to give effect thereto.

Council Reference/Background/History:

By approval of Clause No. 2 of Report No. 9 of The Management Committee (as amended) on March 8 and 9, 1994, and subject to a further report regarding funding, Metropolitan Council approved construction of the Sheppard Subway from Yonge Street to Don Mills Road. By approval of Clause No. 2 of Report No. 14 of The Management Committee (as amended) on April 20, 1994, Metropolitan Council authorized the debenture funding to commence the project. Finally, Metropolitan Council, by its adoption of Clause No. 2 of Report No. 21 of The Financial Priorities Committee on September 25 and 26, 1996 (as amended), approved the completion of the Sheppard Subway Project.

By approval of Clause No. 8 of Report No. 7 of The Corporate Administration Committee on April 24, 1996, Metropolitan Council approved the expropriation of certain temporary and permanent surface and subsurface interests from the owners of 1333 Sheppard Avenue East for the construction, operation and maintenance of the twin tunnel. The temporary interests were expropriated for a term of 40 months which expires on February 28, 2000. Due to unforeseen circumstances, the construction at this location will not be completed by February 28, 2000 and will require a further 21 months (until November 30, 2001) for a portion of the site. Staff are currently attempting to negotiate an extension of the leasehold interest in order to complete the Project at this location, but in the event those negotiations are unsuccessful, it would be necessary to re-expropriate the required interests for a portion of the site for the further time frame in order to allow the Project to continue without disruption.

Comments and/or Discussion and/or Justification:

The subject property is owned by North York General Hospital and leased to 1333 Sheppard Avenue East Holdings Limited which operates a medical office building immediately to the east of the intersection of Sheppard Avenue and Leslie Street. As part of the Sheppard Subway Project a number of property interests have been expropriated from this property for the Don River Bridge construction as well as the Twin Tunnel contract. The tenant has at times objected to the Project, requiring a Hearing of Necessity to be held and appealing Metro Council's preliminary decision to expropriate for the Don River Bridge contract to Divisional Court. Metro successfully defended the Divisional Court application and the Inquiry Officer recommended the expropriation as proposed by Metro for the Twin Tunnel contract. Nonetheless, the parties were eventually able to agree to a lease arrangement for the required property interests. The lease extension is required for various contractors to deliver and install rail, special trackwork, electrical, communication and other systems equipment.

As indicated earlier, the existing temporary worksite lease will expire at the end of February 2000. This worksite has been utilized to construct the subway box and was determined by TTC (confirmed by the Inquiry Officer) to be the preferred location for the installation of track, signals and communication equipment. This is a sequential process and the track and other installations can only commence once the box structure is completed. Due to delays in the completion of the box structure which will house the subway and more detailed analysis of the schedule for the installation of various systems equipment, a lease extension is required. It should be noted that not all of the original worksite is required for this installation work and so the required area can be substantially decreased. This site is advantageous as it is located off of Sheppard, the subway is shallow at this location and the existing opening in the roof of the subway box is the largest available.

City and TTC staff have approached the tenant requesting an extension of the lease for a portion of the site. As of this date the tenant has not agreed to such an extension. To restore the worksite on this property and move the rail drop shaft elsewhere would cause serious disruption to various contracts with attendant cost consequences and impacts on the opening of the subway for revenue service. Because of the delays inherent in the expropriation process, it is necessary to commence the expropriation process at least eight months in advance of the date the property is required. Therefore, in order to ensure that there is no disruption in the construction contract, it is necessary to commence that process immediately.

Particulars of the property requirements are summarized as follows:

Owner:North York General Hospital.

Tenant:1333 Sheppard Avenue East Holdings Limited.

Municipal Address:1333 Sheppard Avenue East (formerly North York).

Legal Description :Part of Lot 15, Concession 3, EYS and part of the road allowance between Lots 15 and 16, Concession 3, EYS in the City of Toronto (formerly North York).

Area of Property:5.19 acres.

Improvements:Two Storey brick medical arts building and concrete parking structure.

Area of Temporary

Requirements:1351 m5.

Term of Temporary

Requirements:March 1, 2000 to November 30, 2001 (21 months).

A sketch of the area for which the lease extension is required is attached as Schedule A. A draft reference plan will be prepared in advance of providing the required Notice of Application for Approval to Expropriate.

The Acting Commissioner of Corporate Services concurs in this course of action.

Conclusions:

The commencement of expropriation procedures for the acquisition of the property interests herein described is necessary at this time to ensure that construction at this location can continue without disruption in the event a lease extension cannot be negotiated.

Contact Name:

Patricia Simpson, Senior Solicitor

392-8057 Fax No.: 392-3848

(A copy of Schedule "A" attached to the foregoing report was forwarded to all Members of Council with the July 21, 1999, agenda of the Administration Committee and a copy thereof is also on file in the office of the City Clerk.)