1999 City-wide Development Charge Calculation

1999 - 2009

The Strategic Policies and Priorities Committee reports, for the information of Council, having also had before it a joint communication (May 3, 1999) from Mr. Jim Murphy, Greater Toronto Homebuilders Association, Mr. Vince Brescia, Local 183, Mr. Richard Lyall, MTABA, and Mr. Stephen Kaiser, UDI, respecting the New Development Charges By-law for the City of Toronto; and forwarding the following recommendations:

(1) that a special meeting of this Committee be held in advance of the proposed June 24, 1999, meeting to hear deputations. We believe that June 24, 1999, will be too late to deal effectively with the issues given that the development charge by-law must be approved by Council prior to August 31, 1999;

(2) that the report from the Chief Financial Officer and Treasurer be referred for review and input from the six Community Councils, the Economic Development Committee and Urban Environment and Development Committee. These committees should report prior to the scheduled June 24, 1999, statutory public meeting pursuant to the Development Charges Act;

(3) that the Urban Planning and Development Services Department be requested to report on the impact of the proposed development charges with respect to the cost of housing in the City and the impact such a policy would have on housing intensification; likewise the Economic Development, Culture and Tourism Department be requested to report on the impacts of development charges on business investment and expansion within the City;

(4) that the Finance Department be asked to provide a report on the current status of the reserve funds collected from development charges in the former City's of Scarborough, North York and Etobicoke, including the amounts collected and the projects/facilities to which such funds are being held in reserve; and

(5) that the Urban Planning and Development Services and/or Legal Department be asked to provide a report on the status of collections made by developers under Section 37 agreements (pursuant to the Planning Act). The report should address the amount of monies collected and the projects/facilities to which developers were asked to make such contributions. Furthermore, the report must address how Section 37 agreements will be structured if the proposed development charge by-law were in place.

The Chief Financial Officer and Treasurer and Mr. Cam Watson, C. N. Watson and Associates Ltd., gave an overhead presentation to the Strategic Policies and Priorities Committee in connection with the foregoing matter, and filed a copy of his presentation material.

The following persons appeared before the Strategic Policies and Priorities Committee in connection with the foregoing matter:

- Mr. Murray Goldman, Chairman, The Goldman Group; and

- Mr. Neil Rodgers, Director of Policy, Urban Development Institute, Ontario.

(A copy of the document entitled "City of Toronto Development Charge Background Study", prepared by C. N. Watson and Associates Ltd., was forwarded to all Members of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee, and a copy thereof is also on file in the office of the City Clerk.)

(City Council on May 11 and 12, 1999, amended this Clause by adding thereto the following:

"It is further recommended that all future reports which involve the possible closure or propose an alternative use for any Works Yards, be forwarded to Council through the appropriate Community Council.")

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Economic Development Committee embodied in the following communication (April 7, 1999) from the City Clerk, subject to striking out Recommendation No. (1) embodied in the report (March 11, 1999) from the Commissioner of Economic Development, Culture and Tourism, and inserting in lieu thereof the following:

"(1) that the Commissioner of Economic Development Culture and Tourism be requested to submit a report to the Strategic Policies and Priorities Committee on the practicality of retaining the Edenbridge Yard, West District, as park space."

The Strategic Policies and Priorities Committee submits the following communication (April 7, 1999) from the City Clerk:

Recommendation:

The Economic Development Committee recommends the adoption of the report (March 11, 1999) from the Commissioner of Economic Development, Culture and Tourism and in accordance with Recommendation No. (8) therein, submits its recommendation in this respect to the Strategic Policies and Priorities Committee.

Background:

At its meeting on March 29, 1999 and April 6, 1999, the Economic Development Committee gave consideration to the report (March 11, 1999) from the Commissioner of Economic Development, Culture and Tourism providing an update on the status of the Yard Rationalization study, and advising that the following recommendations replace those stated in the report dated January 29, 1999, to the Economic Development Committee that:

(1) the Edenbridge Yard, located in the West District, be closed and staff relocated to other yard facilities in the District and that the property be declared surplus;

(2) the staff working from the Bermondsey Yard, located in the East District, be relocated to Northline Road Yard and that the Bermondsey Yard be designated for Works Department staff only;

(3) the staff working from the G. Ross Lord Park Yard, located in the North District, be relocated to the Alness Yard and the facility in G. Ross Lord Park be used as a seasonal location;

(4) the staff working from the Morningside Yard located in Morningside Park, in the East District, be relocated to the Morningside Works/Parks yard located at 891 Morningside Avenue, and that the Morningside Parks Yard be used as a seasonal location;

(5) Phase 2 of the Yard Study consider the consultant's report commissioned by the former City of Toronto to renovate the Chaplin Yard, located in the South District, which is currently vacant;

(6) the staff working from the Humber Bay Yard, located in the West District, be relocated to the Kipling Yard and that the Humber Bay Yard be used as a seasonal location;

(7) the Bathurst Street Yard, located in the South District, continue to be occupied by Toronto Forestry crews until construction of the fixed link bridge, at which time the yard would be closed and staff relocated to other yards; and

(8) this report be submitted, with subsequent recommendations from the Economic Development Committee to the Strategic Policies and Priorities Committee.

The Committee also had before it the report (January 29, 1999) from the Commissioner of Economic Development, Culture and Tourism providing an update on the status of the yard rationalization study and a listing of Parks Yard locations that are surplus to the Department's operating requirements and recommending that this report be received for information.

The Committee's action is as noted.

(Report dated March 11, 1999, addressed to the

Economic Development Committee from the

Commissioner of Economic Development, Culture

and Tourism entitled "Parks Yard Rationalization

- Update - Supplementary Report")

Purpose:

To provide an update on the status of the Yard Rationalization study.

Funding Sources, Financial Implications and Impact Status:

The Department anticipates some efficiency gains and minor cost savings as a result of these recommendations, with further refinement of the financial implication being undertaken as part of Phase II of this study.

Recommendations:

The following recommendations replace those stated in the report dated January 29, 1999, to the Economic Development Committee that:

(1) the Edenbridge Yard, located in the West District, be closed and staff relocated to other yard facilities in the District and that the property be declared surplus;

(2) the staff working from the Bermondsey Yard, located in the East District, be relocated to Northline Road Yard and that the Bermondsey Yard be designated for Works Department staff only;

(3) the staff working from the G. Ross Lord Park Yard, located in the North District, be relocated to the Alness Yard and the facility in G. Ross Lord Park be used as a seasonal location;

(4) the staff working from the Morningside Yard located in Morningside Park, in the East District, be relocated to the Morningside Works/Parks yard located at 891 Morningside Avenue, and that the Morningside Parks Yard be used as a seasonal location;

(5) Phase 2 of the Yard Study consider the consultant's report commissioned by the former City of Toronto to renovate the Chaplin Yard, located in the South District, which is currently vacant;

(6) the staff working from the Humber Bay Yard, located in the West District, be relocated to the Kipling Yard and that the Humber Bay Yard be used as a seasonal location; and,

(7) the Bathurst Street Yard, located in the South District, continue to be occupied by Toronto Forestry crews until construction of the fixed link bridge, at which time the yard would be closed and staff relocated to other yards.

(8) this report be submitted, with subsequent recommendations from the Economic Development Committee to the Strategic Policies and Priorities Committee.

Comments and/or Discussion and/or Justification:

The Strategic Policies and Priorities Committee at its December 15, 1998, meeting, in considering the recommendations from the Budget Committee, contained in the report (November 19, 1998) from the City Clerk, requested the Commissioner of Economic Development, Culture and Tourism Department to report to the Economic Development Committee on the impact of the closure of the yard locations and that these Committees report thereon to the Strategic Policies and Priorities Committee.

The Parks and Recreation Division, Economic Development, Culture and Tourism Department with the Works and Emergency Services Department in coordination with and Facilities and Real Estate, Corporate Services, has commenced a process to rationalize its yards and facilities. Given the complexities involved in the full rationalization of all yards and facilities, a two phased approach is planned. The first phase of the process has been to identify those yards and facilities where the activities can be moved to other locations without incurring significant operating or capital costs.

The second phase involves a more comprehensive study intended to examine opportunities for relocations and better utilization of existing facilities. The study will identify options which will result in longer term efficiencies, through a variety of mechanisms including, co-location of complementary operations, shared use of equipment, human resources and administrative support, standardized technology and more effective positioning of fleet operations, shops and stores.

At its December 15, 1998, meeting, the Strategic Policies and Priorities Committee deferred the request for the approval of funds to hire a consultant for phase 2 and requested that the Commissioner of Economic Development, Culture and Tourism report on the impact of closures of the yards and facilities that are recommended as being surplus to the requirements of the Economic Development, Culture and Tourism Department as part of Phase One.

Staff of the Parks and Recreation Division representing the five (5) districts have been reviewing the Parks yard sites in the City of Toronto. In Phase I, staff have recommended the closure and amalgamation of various sites as outlined in the recommendations contained in this report. In addition, each parks yard has been studied with data collected that describes the size of the yard facilities and the amenities that are available at each yard site. A mapping exercise has been completed that identifies yard locations using the following criteria:

After a complete review of the Parks Yard sites in the City of Toronto there are 39 locations mapped using the following categories:

Major Yards 15

Minor Yards 9

Seasonal Yards 10

(in the park)

Golf Courses 5

Total 39

Evaluation Criteria:

The first phase of the process has been to identify those yards and facilities where the activities can be moved to other locations without incurring significant operating or capital costs.

The criteria considered within this phase included yard utilization rates, travel time to work locations, available resources within yards, opportunities to integrate staff to achieve work efficiencies and seasonal workload requirements.

The following information relates to each yard site outlined in the recommendations:

Edenbridge Yard:

That the staff working from the Edenbridge Yard, located in the West District, be relocated to other yard facilities in the District and the property will be declared surplus. All costs associated with this yard closure will be absorbed within the current operating budget. The relocation of staff to other yards in the District will improve operational effectiveness and provide greater flexibility in the scheduling of work.

Bermondsey Yard:

That the staff working from the Bermondsey Yard, located in the East District, be relocated to the Northline Road Yard. The Parks Division currently occupies one indoor parking space for staff during the winter months and primarily uses this location for one flying crew for summer maintenance. This location is a Works site, however, the full-time staff working in the Parks Operation would benefit being relocated to a major parks yard facility.

G. Ross Lord Park:

That the staff working from G. Ross Lord Park, located in the North District, be relocated to the Alness Yard, and that the facility in G. Ross Lord be maintained as a seasonal yard location. During the summer months, approximately sixty (60) staff provide parks maintenance using the facilities in G. Ross Lord Park as a yard site. We would recommend that this practice continue during the summer months, however, the location be closed during the winter season.

Morningside Park Yard:

That the staff working from the Morningside Yard, located in Morningside Park, in the East District, be relocated to the yard that is shared between Works and Parks located at 891 Morningside Avenue. The yard located in Morningside Park become a seasonal location that will be used by the seasonal work force to do parks maintenance during the summer months. The "Morningside Park" yard location will be closed during the winter months.

Chaplin Yard:

The Chaplin Yard or Chaplin Stores, located in the South District, is currently vacant and should be evaluated as part of Phase 2 of the Yards Study. There has been a building condition assessment provided to Parks and Recreation Division from the Property Operations section of Corporate Services. It has been identified that there is $400,000.00 worth of capital work that is necessary to be done in the immediate future to provide such repairs as:

(i) structural repairs to the floor slap;

(ii) repair and maintain the existing boiler and roof-top air-conditioning unit;

(iii) minor roof repairs;

(iv) install CO detection system;

(v) upgrade and repair telephone system $ 372,300.00;

(vi) painting and drywall repair;

(vii) install fan in chemical storage room;

(viii) electrical circuits for office computers;

(ix) security lights; and

(x) repair to a retaining wall on site.

In addition, there were optional items suggested in Phase II that include:

(i) checking the chimney liner;

(ii) electrical upgrades in the garage and offices;

(iii) replace office carpets $ 27,700.00;

(iv) window repairs including security grills;

(v) painting of exterior steel windows; and

(vi) contingency.

The painting of the garage on two levels has an estimate of $18,000.00 and has not been included in this price estimate. Staff operating in the South District feel that this capital work would allow for the Chaplin Yard to be a Parks yard that would allow the closure of both the Sherwood and Rosehill Yards. The Rosehill Yard is overcrowded and not suitable for staff and/or vehicles stored in the congested parking lot. The Sherwood Yard has problems with vandalism, security and there is community support to close this site and relocate to another location. If the Chaplin Yard was renovated, the South District would use this site as a Parks Yard and would recommend closure of both the Sherwood and Rosehill Yard facilities. Total cost of renovation would be approximately $400,000.00.

Humber Bay Yard:

That the staff working from the Humber Bay Yard, located in the West District, be relocated to the Kipling Yard and this yard facility would be used as a seasonal park location that would accommodate crews during the summer months.

Bathurst Street Yard:

That the forestry staff working from Bathurst Street Yard, located in the South District, be relocated to other sites when construction of the fixed link bridge proceeds.

Conclusions:

In Phase I, recommendations and mapping exercise have been completed by Parks staff. The 39 locations have been inventoried and data has been gathered to include facility descriptions, square footage of indoor and outdoor storage for both equipment supplies and vehicles, workshop areas, greenhouses, size and type of trade shops available, staff facilities to include locker rooms, showers and lunchrooms, storage of equipment and supplies for recreation and concessions and hazardous materials, fuelling opportunities and parking for staff.

This data collection will allow staff to be better prepared for the second phase of the study that will allow for a more comprehensive look at utilizing the existing facilities. Decisions around longer term efficiencies, sharing of sites between various departments to include Works and Transportation, shared use of equipment, human resources and administrative support, with standardized technology and more effective use of fleet, shops and stores.

Contact Name:

Don Boyle, Director Parks and Recreation, West District; Tel: 394-5723.

(Report dated January 29, 1999, addressed to

the Economic Development Committee from the

Commissioner of Economic Development, Culture and Tourism)

Purpose:

To provide an update on the status of the yard rationalization study and a listing of Parks Yard locations that are surplus to the Department's operating requirements.

Funding Sources, Financial Implications and Impact Statement:

Not applicable at this time.

Recommendation:

It is recommended that this report be received for information.

Council Reference/Background/History:

The Strategic Policies and Priorities Committee at its December 15, 1998 meeting, in considering the recommendations from the Budget Committee, contained in the report (November 19, 1998) from the City Clerk, requested the Commissioner of Economic Development, Culture and Tourism Department report to the Economic Development Committee on the impact of the closure of the yard locations and that this Committee report thereon to the Strategic Policies and Priorities Committee.

Comments and/or Discussion and/or Justification:

The Parks and Recreation Division, Economic Development, Culture and Tourism Department with the Works and Emergency Services Department in coordination with Facilities and Real Estate, Corporate Services, has commenced a process to rationalize its yards and facilities. Given the complexities involved in the full rationalization of all yards and facilities, a two phased approach is planned. The first phase of the process has been to identify those yards and facilities where the activities can be moved to other locations without incurring significant operating or capital costs.

The second phase involves a more comprehensive study intended to examine opportunities for relocations and better utilization of existing facilities. The study will identify options which will result in longer term efficiencies, through a variety of mechanisms including, co-location of complementary operations, shared use of equipment, human resources and administrative support, standardized technology and more effective positioning of fleet operations, shops and stores.

At its December 15, 1998, meeting, the Strategic Policies and Priorities Committee deferred the request for the approval of funds to hire a consultant and requested that the Commissioner of Economic Development, Culture and Tourism report on the impact of closures of the yards and facilities that are surplus to the requirements of the Economic Development, Culture and Tourism Department as part of Phase One.

There are currently thirty-one (31) Parks Yard Operations across the City of Toronto. These locations include full-time parks operations, offices, workshops, storage, garages, compounds and seasonal storage building or golf course operation facility.

In addition, seven (7) Yards are shared between the Works and Parks Operations. These Yards are used for fleet and equipment maintenance and storage, supply material inventory and sign shops.

Two (2) locations are shared between Parks/Works/Transportation.

District staff are currently evaluating the thirty-one (31) Parks Yards (the ones not located in parks) with respect to amenities, square footage of sites, users, features, technology and travel time to parks sites.

At present, the Edenbridge Yard located at Edenbridge and Scarlett Road is declared surplus to Economic Development, Culture and Tourism, Parks and Recreation Division. The Edenbridge Yard located in the West District includes a building with two mechanic bays, lunchroom, locker-room and office space. Currently the building has used capacity of 3,280 sq. ft. and the Yard compound for storage of equipment and vehicles - 27,514 sq. ft.

There are a limited number of staff that work at the site. They include one full-time mechanic, 4 forestry and 4 Parks Maintenance staff. As the Forestry and Maintenance staff work in the field, there is only one staff (mechanic) in the building working full-time.

Staff that currently work at the Edenbridge Yard will be redeployed to either the Kipling or Rockcliffe Parks Yard that are fully functioning operations. The closing of this location will not have an operating impact on Parks Services in the West District. The minimal costs required to move will be absorbed within the Department's operating budget. Corporate Services can now determine the future status of this site and whether they can be declared surplus, made available for sale, lease or incorporate into the general parks inventory.

The Corporate Services Department will be forwarding a report to the February, 1999 meeting of the Corporate Services Committee with recommendations on the completion of the second phase of the yard rationalization study.

Contact Name:

Don Boyle, Director, Parks and Recreation, West District, 394-5723.

The Strategic Policies and Priorities Committee also submits the following communication (April 29, 1999) from the City Clerk, Etobicoke Community Council:

The Etobicoke Community Council at its meeting held on April 28, 1999, adopted the following Motion by Councillor Bruce Sinclair, Rexdale-Thistletown, respecting the Edenbridge Yard, West District:

"WHEREAS the Edenbridge Yard is an area of open space in proximity to James Gardens, the associated tennis club, and other park and trail amenities comprising the Humber Valley Parks system, and

WHEREAS there is increasing demand for open space and recreational facilities, particularly in light of changing demographics, and

WHEREAS any redevelopment, apart from parkland, is a remote possibility considering the fact that the area in question was a former disposal site,

THEREFORE BE IT RESOLVED THAT the Director of Parks and Recreation, West District, be requested to submit a report to the Etobicoke Community Council on the possibility of retaining the property in the City park system as an integral part of the Humber Valley Park system; and

THAT the Strategic Policies and Priorities Committee be requested to defer consideration of Recommendation No. (1) contained in Agenda Item No. 2, headed "Parks Yard Revitalization Study", on the agenda for the meeting of the Committee on May 4, 1999, pending receipt of the aforementioned report by the Etobicoke Community Council."

(Copies of the attachments respecting "Parks Yard Operations" (Listed by District") and maps identifying yard locations were forwarded to all Members of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee and copies thereof are also on file in the office of the City Clerk.)

(City Council on May 11 and 12, 1999, amended this Clause by:

(1) striking out and referring Recommendation No. (6) of the Strategic Policies and Priorities Committee to the Office Consolidation Sub-Committee, viz.:

"(6) the Corridors located on the second floor at City Hall be renamed to reflect their geographical location i.e., Bay Street, Dundas Street, Queen Street, and University Avenue."; and

(2) adding thereto the following:

"It is further recommended that:

(a) the report dated May 12, 1999, from the Commissioner of Corporate Services, entitled 'Office Space Consolidation - Report on Swing Space', be referred to the Office Consolidation Sub-Committee, and the Commissioner of Corporate Services be requested to submit a supplementary report, for consideration therewith, clearly outlining the details on the reduction of office space (i.e., where and how much) as well as the full costs involved;

(b) the Office Consolidation Sub-Committee be requested to:

(i) also give consideration to the composition of the internal staff team assigned to the task; and

(ii) forward its recommendations in this regard to Council for its meeting to be held on July 27, 28 and 29, 1999, through the Administration Committee.")

The Strategic Policies and Priorities Committee recommends that:

(1) the six existing washrooms located on the second floor be renovated and additional funds in the amount of $14,200.00 be allocated for this purpose;

(2) the glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose;

(3) the funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location;

(4) when renovations to the Glass House and two adjoining rooms located in the underground parking level of City Hall are undertaken, such renovations allow for staff to observe pedestrian and vehicular traffic, i.e., no physical obstructions to obscure the view of staff be put in place, for security reasons;

(5) funding for the renovations be provided from the Capital Account for Transition Projects; and

(6) the Corridors located on the second floor at City Hall be renamed to reflect their geographical location i.e., Bay Street, Dundas Street, Queen Street, and University Avenue.

The Strategic Policies and Priorities Committee reports, for the information of Council, having requested the Commissioner of Corporate Services to submit a detailed report directly to Council for its meeting scheduled to be held on May 11, 1999, on the amount of swing space that is currently being rented to date, such report to also include the cost in regard thereto.

The Strategic Policies and Priorities Committee submits the following communication (April 30, 1999) from the City Clerk:

Recommendations:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee and Council, the adoption of the recommendations of the Corporate Services Committee embodied in the communication (April 22, 1999) from the City Clerk, subject to:

(1) adding the following:

"that when renovations to the Glass House and two adjoining rooms located in the underground parking level of City Hall are undertaken, such renovations allow for staff to observe pedestrian and vehicular traffic, i.e., no physical obstructions to obscure the view of staff be put in place, for security reasons"; and

(2) funding for the renovations be from the Capital Account for Transition Projects.

The Budget Committee further reports, for the information of the Strategic Policies and Priorities Committee, having requested that the Office Consolidation Sub-Committee appear before the Budget Committee at its next meeting on May 25, 1999, to answers Members questions with regard to the status of renovations to City Hall.

Background:

The Budget Committee had before it a report (April 22, 1999) from the City Clerk advising that the Corporate Services Committee on April 19, 1999, recommended to the Budget Committee and Council, the adoption of Recommendations Nos. (1), (2), (3) and (5) of the Office Consolidation Sub-Committee embodied in the communication (April 13, 1999) from the City Clerk, viz:

"(1) the six existing washrooms located on the 2nd floor be renovated and additional funds in the amount of $14,200.00 be allocated for this purpose;

(2) glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose;

(3) the funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location;

(4) the Meeting Rooms be renamed to reflect the corridor in which they are situated."

Councillor Ron Moeser, Chair, Office Consolidation Sub-Committee appeared before the Budget Committee in connection with the foregoing matter.

Recommendations:

The Corporate Services Committee on April 19, 1999, recommended to the Budget Committee and Council, the adoption of Recommendations Nos. (1), (2), (3) and (5) of the Office Consolidation Sub-Committee embodied in the communication (April 13, 1999) from the City Clerk, viz:

"(1) the six existing washrooms located on the second floor be renovated and additional funds in the amount of $14,200.00 be allocated for this purpose;

(2) glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose;

(3) the funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location; and

(4) the Meeting Rooms be renamed to reflect the corridor in which they are situated."

The Corporate Services Committee reports, for the information of the Budget Committee, having:

(1) referred Recommendation No. (4), embodied in the communication (April 13, 1999) from the City Clerk, back to the Office Consolidation Sub-Committee for further consideration; and

(2) requested the Office Consolidation Sub-Committee to:

(i) give consideration to the problem of the constant banging of doors in Committee Rooms Nos. 1 and 2 on the second floor at City Hall, during Committee meetings;

(ii) review the question of access for physically challenged individuals to the committee rooms located on the second floor;

(iii) report to the Corporate Services Committee respecting the disposition of funds established by the City of Toronto from the sale of the Langstaff Jail to make City Hall accessible; and

(iv) review the situation respecting Members of Council accessing the official parking area at City Hall and the problems associated with the steel doors in that area.

Background:

The Corporate Services Committee on April 19, 1999, had before it a communication (April 13, 1999) from the City Clerk advising that the Office Consolidation Sub-Committee, during its consideration of a report (April 9, 1999) from the Commissioner of Corporate Services, entitled "Phase 1 Renovations to Toronto City Hall - Recommended Actions in Response to Office Consolidation Sub-Committee Motions and Additional Budget Requirements", recommended to the Corporate Services Committee and the Budget Committee that:

(1) the six existing washrooms located on the second floor be renovated and additional funds in the amount of $14,200.00 be allocated for this purpose;

(2) glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose;

(3) the funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location;

(4) the western square Councillor's Corridor be renamed as Corridor "D", and the "C" reception area be renamed Reception "C and D"; and

(5) the Meeting Rooms be renamed to reflect the corridor in which they are situated.

Recommendations:

The Office Consolidation Sub-Committee recommends that:

(1) the six existing washrooms located on the second floor be renovated and additional funds in the amount of $14,200.00 be allocated for this purpose;

(2) glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose;

(3) the funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location;

(4) the western square Councillor's Corridor be renamed as Corridor "D", and the "C" reception area be renamed Reception "C and D";

(5) the Meeting Rooms be renamed to reflect the corridor in which they are situated.

The Sub-Committee reports for the information of the Budget Committee and Corporate Services Committee having requested the Commissioner of Corporate Services:

(1) to report further on overall parking policy for all the Civic Centres and egress options for the employee parking at City Hall; and

(2) to further report on the feasibility of upgrading the East and West Tower elevator system to improve access to the Council Chamber, at an approximate cost of $80,000.00.

Background:

The Sub-Committee had before it the report (April 9, 1999) from the Commissioner of Corporate Services regarding Phase I Renovations to Toronto City Hall - Recommended Actions in Response to Office Consolidation Sub-committee Motions and Additional Budget Requirements.

The Sub-Committee's recommendations are noted above.

Purpose:

To recommend actions to follow-up on the Phase 1 renovations to City Hall in response to motions adopted by the Office Consolidation Sub-Committee and to identify additional budget requirements.

Source of Funds:

Funds in the amount of approximately $50,400.00 will be required to implement the changes necessary to complete the renovations recommended in this report. An additional $80,000.00 will be required if additional upgrades to the existing East and West Tower elevators to provide better access to the Council Chamber are endorsed. These costs could be accommodated within the $10.5 million earmarked in the 1999 Capital Budget for Facilities and Real Estate Division amalgamation initiatives, once the budget is approved by City Council.

Recommendations:

It is recommended that the following actions and additional funding requests pertaining to Phase one of the City Hall renovations be endorsed:

(1) Action A: That the six existing washrooms located on the second floor be renovated and funds in the amount of $14,200.00 be allocated for this purpose.

(2) Action B: That glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose.

(3) Action C: That funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining transportation rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location.

(4) Action D: That the new wayfinding signage system on the second floor which designated the corridors to Councillors offices as "Streets A, B and C" not be modified.

(5) Action E: That the Commissioner of Corporate Services report back on an overall parking policy for all the Civic Centres and egress options for the employee parking at City Hall.

(6) Action F: That the Commissioner of Corporate Services report back on the feasibility of upgrading the East and West Tower elevator system to improve access to the Council Chamber, at an approximate cost of $80,000.00.

Background:

The Office Consolidation Sub-Committee on March 10, 1999, requested the Commissioner of Corporate Services to report back to the Sub-Committee on various minor design modifications requested respecting the completion of the Phase 1 City Hall renovations project; and to identify additional budget requirements.

Discussion:

The Facilities and Real Estate Division Project Team analyzed the design modifications requested by the Sub-Committee, in terms of whether they are technically feasible and what the cost implications are. The relevant issues along with recommended actions and additional funding requirements are discussed below.

(1) Second Floor Existing Washrooms

Motion: The Sub-Committee deferred consideration of the Scope of Work-Washrooms and requested a further report on the Cost of Options.

Comment:

Prior to the renovations to the second floor of City Hall taking place, there were six existing washrooms in the inner East and West Tower corridors. Funding to renovate these washrooms was not included in the Phase 1 scope of work. Giving these washrooms a minimal facelift in keeping with the appearance of newly renovated second floor will require minor work, including repainting washroom ceilings and stalls, replacing small mirrors with new larger mirrors and installing some new hardware, at a total cost of $14,200.00. This renovation will take approximately two weeks.

Recommended Action:

Action A: That the six existing washrooms located on the second floor be renovated and additional funds in the amount of $14,200.00 be allocated for this purpose.

(2) Reduce Sound Transference from Committee Room No. 1 into Adjacent Hallways

Motion: The Sub-Committee requested the Commissioner of Corporate Services to report back to the Sub-Committee on the measures to prevent sound spilling from Committee Room No. 1 into adjacent hallways; such report to identify possible funding sources.

Comment:

Reducing the sound transference from Committee Room No. 1 into adjacent hallways will require the replacement and upgrading of the room's existing original glazed windows with thicker tempered and laminated glazing and checking the sound baffles above the ceiling. Sound transference will be reduced along the new glazing although not along the doors. The renovation will take approximately four weeks lead time plus two weeks installation, with an associated cost of $18,200.00.

Recommended Action:

Action B: That glass replacement to prevent sound spilling from Committee Room No. 1 into adjacent hallways be approved and funds in the amount of $18,200.00 be allocated for this purpose.

(3) Glass House and Council Transportation Rooms

Motion: The Sub-Committee requested the Commissioner of Corporate Services to report further on the Glass House Renovations for Limousine Drivers, as well as cost and timing.

Comment:

There are currently eight Council drivers using the two existing transportation rooms behind the Glass House located on the underground parking level of City Hall. Prior to amalgamation, there were five drivers using these two small rooms and after amalgamation three more drivers moved from Metro Hall. With the relocation of the Mayor and all Councillors to City Hall, there is a functional need to consolidate space for the Council drivers at one location at City Hall. Combining the Glass House and the two adjoining rooms into one larger unit will better accommodate the drivers' requirements.

The design fees, demolition, painting, carpet installation, installation of data and electrical services and HVAC modification will take approximately three weeks, at a cost of $18,000.00.

Recommended Action:

Action C: That funds in the amount of $18,000.00 be allocated to renovate the Glass House and two adjoining rooms located on the underground parking level of City Hall to accommodate the Council drivers in one location.

(4) Second Floor Signage - Streets A, B and C

Motions: The Sub-Committee requested the Commissioner of Corporate Services to report back to the Sub-Committee on the design, location and layout of the wayfinding signage for the Councillors' corridors - Street A, B, and C.

The Sub-Committee requested the Commissioner of Corporate Services to report back to the Sub-Committee on the cost and implementation of altering the laneway signage on the south side of the Councillors' corridors to include a pathway titled Street D.

Comment:

The wayfinding system developed and implemented for the second floor Councillors' offices was based on a "street" concept, corresponding to the three distinct zones of Councillors' offices along the north, west/south-west and east/south-east sides of the second floor. Each of the three streets is entered by way of its own corresponding reception area located at the entrance to each street.

Altering the signage on the south side of the Councillors' corridors to include a pathway titled "Street D" would not be feasible without having a significant impact on the Mayor's offices and Councillors' two south reception areas.

The consultants on the project who included Karo, Kuwabara Payne McKenna Blumberg Architects and Paul Arthur of PAVL collectively recommend that the wayfinding system as implemented not be modified, as indicated in their submissions attached as Appendix "A".

Recommended Action:

Action D: That the new wayfinding signage system on the second floor which designated the corridors to Councillors' offices as "Streets A, B and C" not be modified.

(5) Parking Policy and Employee Parking

Motion: The Sub-Committee requested the Commissioner of Corporate Services to report on work with the Parking Authority of Toronto for accessing employee parking.

Background:

Staff of the Facilities and Real Estate Division have had numerous discussions and met with the Parking Authority about:

(i) options for the overall parking policy at all Civic Centres; and

(ii) the egress options for the employee parking at City Hall.

Overall Parking Policy:

This policy is currently under development and will be presented to the Property Management Committee in May 1999 prior to presentation at the Office Consolidation Sub-Committee.

Egress Options at City Hall:

As a result of the discussions with the Parking Authority, it is apparent that some detailed work is required to resolve compatibility issues with proximity card readers (between the City system and the Parking Authority's new system) for egress from the employee parking lot at City Hall. The overall parking policy will present options for the issues of corporate pool cars and ultimate responsibility for management of the employee parking area which may impact on the egress options. Until these issues are resolved, any expenditure on parking gates and anti-passback controllers for a different egress from the employee parking area may be unnecessary and is therefore not recommended.

The project has therefore been divided into two phases:

Phase One work (scheduled completion April 30, 1999) involves:

(a) Providing an IN gate at the entrance of the Taxi Tunnel. Alongside this IN gate will be a pedestal housing a long range proximity card reader and an intercom.

(b) Connecting the existing IN overhead door to function in conjunction with the card reader for 24 hour access when the overhead door is down (11:00 PM - 7:00 AM).

(c) Providing an intercom station near the handicapped lift.

(d) Repainting the Official Parking Garage signage to turn the old entrance into the new exit and vice versa.

(e) Providing a new high speed roll-up overhead door with a door contact at the Official Parking entrance. A parking pedestal housing a long range proximity card reader and an intercom will be placed by the entrance before this overhead door. Along with this door will be the necessary safeties, loop detectors, and associated hardware.

(f) Providing a new high speed roll-up overhead door with a door contact at the Official Parking exit. This door will open automatically upon sensing vehicular movement inside the Official garage. No card read out will be necessary.

(g) Providing an OUT gate at the Taxi Tunnel exit. Alongside this EXIT gate will be a pedestal housing a long range proximity card reader and an intercom.

(h) Connecting the existing OUT overhead door to function in conjunction with the card reader for 24 hour egress when the overhead door is down (11:00 PM - 7:00 AM).

Phase Two work involves:

(a) Providing a new employee parking vehicular exit.

(b) Closing the existing employee parking vehicular exit.

Phase Two is being coordinated with the Parking Authority. Its progress will be reported at the next Office Consolidation Sub-Committee meeting.

From April 15 to April 30, 1999, we will be taking and producing all of the employee access cards. At this time, we will be posting information about the upcoming upgrades to the Official Garage, Taxi Tunnel, and Employee Parking Garage.

Recommended Action:

Action E: That the Commissioner of Corporate Services report back on overall parking policy for all the Civic Centres and egress options for the employee parking at City Hall.

6. Access to Council Chamber and Second Floor City Hall

Motion: The Sub-Committee requested the Commissioner of Corporate Services to report on access to Council Chamber and the second floor, such report to include:

(a) Volumes during Council Meetings - Upgrade Present Elevators; and

(b) Safety Issues (Fire Alarm Drill), Stairs.

Comment:

(a) There are three inner core elevators and four East and West Tower elevators providing access from the basement, first, and second floors to the Council Chamber. The Project Team and Otis Elevator engineers are currently investigating the possibility of upgrading the existing East and West Tower elevator system and signage to provide better access the Council Chamber. Early estimates from Otis Elevator indicate that this modification will cost approximately $80,000.00, as indicated in the memorandum attached as Appendix "B".

In the interim, temporary signs have been installed in the main and second floor lobbies of both the East and West Towers to direct people to the Council Chamber.

(b) Fire alarm drills which include complete evacuation of the building are conducted at City Hall once a year in accordance with the Ontario Fire Code. Notices informing occupants about of the date and time of any drill are posted at least 48 hours in advance. Fire drills apply to the entire building including the second floor and the Council Chamber.

Recommended Actions:

Action F: That the Commissioner of Corporate Services report back on the feasibility of upgrading the East and West Tower elevator system to improve access to the Council Chamber, at an approximate cost of $80,000.00.

Conclusions:

This report responds to items recently raised by the Office Consolidation Sub-Committee following completion of the Phase 1 renovations to City Hall. In most cases, actions are recommended to either fine-tune work already done or undertake additional work resulting from minor design modifications requested by the Sub-Committee. The time required to complete the work along with cost estimates are identified.

Contact Name:

Susanne Borup, Executive Director, Facilities and Real Estate Division, phone 397-4156, fax 397-0825, e-mail SusanneBorup@city.toronto.ca.

(1) Memorandum from Karo, March 18, 1999

"Please find the following outline of wayfinding system strategy and our response to the City's request to place Councillors' names on the reverse side of the fin signs:

Karo's mandate from the beginning of this project was to make the areas associated with the renovation of the City Hall more accessible to first-time visitors and the general public, with particular sensitivity to those citizens who are physically and/or cognitively challenged. Our rationale was that if a first-time visitor can effectively find their way to the services and areas they require, then users and staff familiar with the facility and the wayfinding program will surely be able to navigate.

With this in mind, we developed a wayfinding system for the second floor Councillors' offices based on the Street concept, corresponding to the three distinct zones of Councillors' offices along the north, west/south-west and east/south-east sides of the second floor. Each of these three streets is entered via its own corresponding reception area, located at the entrance of each street.

The system works as follows: When a member of the public comes to City Hall looking for a Councillor, a ground floor directory indicates the Councillor's name, Street (A, B or C) and the corresponding office number, such as A14, B35 or C56. They then proceed to the street reception area which acts as a control point of entry for that zone of Councillors' offices. A sub-directory listing the Councillors and their corresponding office number is located at each reception. The wayfinder gains access to the office area and proceeds to the office number that corresponds to their Councillor's name.

As the wayfinder moves from the reception area through the street, they are addressed by a series of "door fins" which indicate the entrance to a particular councillor's office. The office number, Councillor's name, ward name and ward number are indicated on the fin sign. If a wayfinder passes the office number they are trying to locate, they turn around and come back to the office number they require. The office number is repeated on a disk mounted to the glass on the latch side of the door. This method of locating a Councillor's office is also reinforced by the overhead directional signage which directs wayfinders to particular office numbers and streets.

The majority of the fin signs are single sided because, in most locations, the reverse side of the fin backs on to the glazing of the neighbouring Councillor's office. The reverse side was intentionally left blank so that it would not confuse wayfinders as to who belongs to which office. As you are aware, accessibility issues relating to signage dictate that, among other things, room identification signage must be consistently located adjacent to the room entrance, typically on the latch side of the door. If the signage were located on both sides of the fins, the clarity of the system would immediately break down and wayfinders would become confused, frustrated and disoriented, which will lead to more wayfinding related question being directed to the Councillors' office staff.

Locating the Councillors by office number was the only option available to us. Councillors cannot be organized by name, in alphabetical order, due to the temporary and fluctuating nature of their office locations (they shift every election). Nor have they been located by ward number because citizens rarely know which ward number they live in. As a result of these and the lottery system for "equitable" locating of Councillors, the wayfinding system must relate to the only permanent item - the office number.

Thus, the system instructs wayfinders to look for an office number, not a Councillor's name. Staff should know the office number of the Councillor they are looking for. If they miss an office number, they can either look up to suspended directional signage, or to the next office and observe which number they are at. Staff should be informed how Councillors office locations have been allocated and instructed to look for them by office number, not name.

Our system was carefully thought out and the necessary information has been consistently confirmed at key points along the way. It was fully approved prior to implementation and is fully in accord with the best wayfinding principles.

For the reasons cited in this memo, namely the confusion which will arise from conflicting messages and sign clutter, as well as the incurring of unnecessary expense, the consultants involved (Karo, Shirley Blumberg (KPMB Architect), Paul Arthur (PAVL) and Geoff Eden (City of Toronto Accessibility Committee) collectively recommend that the fin signage remain as implemented.

We would be pleased to make a presentation of the system, if required. Should you have any questions or comments about the above, please contact me directly at (416) 927-7094 ext. 238."

(2) Memorandum from Karo, March 23, 1999

"... Further to your request, please find the following regarding the addition of D Street to the second floor wayfinding system. As you know, A, B and C Streets all correspond to three actual, physical spaces which are architecturally determined. Each of these areas has its own entrance, reception area, corresponding offices, colour code and signage. If there were four distinct areas, with their own entrances, occupied by Councillors offices, then there would be a D Street.

The request for the following cost and scheduling ramifications for the addition of D Street illustrates a basic misunderstanding of the wayfinding system and underscores the need for an explanation of the system.

To create D Street, the City would have to create a new distinct area on the second floor with its own entrance, reception and Councillors offices, and then link it to the other streets. Architecturally this would be feasible if the City wishes to relocate the Mayor's office. A fourth colour would then be applied to this area and the colour bar of the signage. Existing directional signage throughout the renovated areas would have to be modified to accommodate the addition of D Street. New signage for the area would be based on the existing signage designs in place in the other streets.

Costs: We cannot comment on the additional construction cost, project management or architectural fees which would be incurred due to a renovation of this type. Signage budgets would be as follows:

Update and replace existing signage:

Sign type Quantity Fabrication Installation

cost cost

4.1 - Wall Mounted Directional 4 $3,600.00 $300.00

4.3 - Atrium Suspended 5 10,250.00 2,000.00

4.4 - Wall Mounted Directional 4 4,200.00 800.00

4.6 - Atrium Suspended 4 5,200.00 850.00

Total 23,250.00 3,950.00 $27,250.00

Create new signage

Sign type Quantity Fabrication Installation

cost cost

M.7 Councillors fin 10 $10,000.00 $2,200.00

3.3 - Reception 1 2,200.00 300.00

4.2 - Suspended Directional 6 12,270.00 2,500.00

5.1 - Street Directory 1 2,000.00 800.00

Miscellaneous Identification 10 2,500.00 350.00

Total 28,970.00 6,450.00 $35,420.00

Total Fabrication/Installation $62,670.00

Karo Design and Management $28,000.00

Grand Total $90,670.00"

(3) Fax from Kuwabara Payne McKenna Blumberg Architects, April 7, 1999

"We are familiar with the contents of the two memos dated March 18 and 23, 1999, which were prepared by David Plant of Karo with respect to the addition of street D signage.

This letter is to reiterate that we concur with Karo's comments and recommendations."

(4) Fax from Paul Arthur, PAVL, April 7, 1999

"I have just been apprised today that I am to send you a letter confirming my complete agreement with the content of the two faxes sent to Lawrence, dated March 18 and 23, 1999.

On the subject of the fins, it should not be thought that the solution about the signing of the individual offices was taken hurriedly. Nor was it taken without our asking the designers to provide full-sized mock-ups, even prior to the installation of the fins themselves. It was the unanimous opinion of the architect, the designer, and myself as the City's advisor on wayfinding issues that our joint decision was the only appropriate one.

Quite apart from that observation, however, we were also unanimous in feeling that the solution will be effective.

I do hope that the idea of redeveloping the second floor to accommodate an unnecessary 'street' will go no further."

(1) Memorandum from Otis Elevator, April 8, 1999

"In order to provide you with an elevator shuttle(s) in each tower at City Hall, we envision the following.

Otis will supply and install 2 two new sets of hall buttons, one at the main level and one at the C level. The new set of hall buttons at the lobby level will have a key switch. When the keys switch is turned on, one or two of the elevators will only serve the lobby and c level and only respond to calls made on one of the new sets of hall buttons. When the key switch is turned off, the elevators will run normally, serving all floors and the new sets of hall buttons will be inactive. The building will have to be provide appropriate signs for the public regarding the operation of the elevators.

Please note that we need a little more time for our engineers to determine if this is even reasonably possible and that the best budget pricing I can provide at this time is about $40,000.00 per tower."

(City Council on May 11 and 12, 1999, had before it, during consideration of the foregoing Clause, the following report (May 12, 1999) from the Commissioner of Corporate Services:

Purpose:

To respond to a request from the Strategic Policies & Priorities Committee.

Source of Funds:

N/A

Recommendations:

It is recommended that this report be received for information.

Background:

The Strategic Policies and Priorities Committee at its meeting on May 5, 1999, requested the Commissioner of Corporate Services to submit a detailed report directly to Council for its meeting scheduled to be held on May 11, 1999, on the amount of swing space that is currently being rented to date, such report to also include the cost in regard thereto.

Comments:

(A) The Decision to Lease Swing Space

In the first sixteen months of the new City's existence the amount of office space used by municipal staff has been cut by almost 10%. On January 1, 1998, staff occupied 1.78 million square feet of general purpose office space; today that number has dropped to 1.62 million square feet. Altogether, the City has emptied more office space than it has in the Scarborough Civic Centre.

Most of the reduction has been achieved by ending leases of commercial office space and accommodating staff in municipal buildings, into space vacated as a result of downsizing. The City is realizing annualized operating savings of $2.7 million.

The City has done more than just cut back on its permanent use of rented office space. Over the past few months it has had to provide temporary accommodation, mainly in municipal buildings, for close to 350 people working on the Y2K Project and more than one hundred who are implementing the SAP Financial Information System.

The combined effect of these two pressures left the City with no vacant office space this spring, and forced staff to recommend leasing temporary "swing space" to house those staff who would be displaced by the lower East Tower renovations. The original staff report recommended that up to 75,000 square feet of space be leased for one year, with a one year renewal option, and budgeted for this at an estimated maximum of $30 per square foot (for rent plus fit-up costs).

At its meeting of February 4, 1999 City Council adopted the Strategic Policies & Priorities Report No.2, Clause 1, along with an amending motion that:

The Commissioner of Corporate Services be requested to:

(1) make every effort to minimize the amount of leased space required for the temporary relocation of staff displaced during the office consolidation process by utilizing office space under the ownership of the City of Toronto, or currently being leased by the City, and if new leased space is required, the Office Consolidation Sub-Committee be so advised; and

(2) submit a report to the Strategic Policies & Priorities Committee, through the Office Consolidation Sub-Committee, on the leasing of temporary office space, outlining the cost, location and number of square feet leased, prior to the signing of any lease.

The resulting report to SPPC advised that the amount of space leased could be reduced to 65,000 square feet. It also advised that: "based on an extensive search of space currently available, staff now believe they can negotiate suitable space at a rate of $17.00 - $20.00 per square foot" The report also noted that "the City's fit-up costs, mainly telecommunications, computer wiring and basic security, would add between $4 - $7 per square foot, depending on the premises, which would bring the total cost for displacement space within the range of $1,365,000 to $1,755,000 for the first full year of the lease, and a maximum of $1,300,000 in the second year, in the event that the City still needs the full space for that time".

When City Council adopted Strategic Policies & Priorities Report No.5, Clause 6, at its meeting of March 2 - 4, 1999, it approved a recommendation that:

The Commissioner of Corporate Services be authorized to enter into a one year lease, with a one year renewal option, for up to 65,000 square feet of office space within reasonable walking distance of City Hall, to provide for the temporary relocation of staff displaced during the office consolidation process.

(B) The Amount and Cost of Swing Space Actually Being Leased

The City has entered into a lease for 65,000 square feet of Class B office space at 500 University Avenue, immediately north of Dundas Street, effective April 1, 1999. A net effective lease rate of $19.95 per square foot per annum (plus GST) was negotiated. This rate is within the parameters set by City Council subject to adjustment, either upward or downward, depending on the year-end actual taxes and operating costs. The lease provides the City with the right to renew for up to one year, though it may terminate any such renewal period, for the whole premises or any part, subject to six months notice in writing. More than one such termination is also permitted, should the City require it.

Fit up of the space is now underway, and the first staff moved in earlier this month. The fit up has included carpet cleaning, minor repainting, extensive wiring and telecommunications work. The final fit-up costs are not yet known, but expected to be approximately $300,000 net, or about $4.60 per square foot.

Conclusion:

The City has leased 65,000 square feet of displacement office space, as authorized by City Council. The cost of leasing and fitting up this space are as previously reported and within the approved budget allocation.

Contact Name:

Simon Chamberlain, Project Director, Office Consolidation, Facilities & Real Estate

Phone No. 392-9697, Fax No. 392-4828, E-Mail: schamber@toronto.ca

Doug Stewart, Director of Real Estate Services,

Phone No. 392-7202, Fax No. 392-1880, E-mail: dstewart@toronto.ca

Susanne Borup, Executive Director, Facilities & Real Estate, Phone No. 397-4156)

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of Recommendations Nos. (1) (2) and (3) embodied in the confidential report (April 26, 1999) from the City Solicitor, respecting an appeal of Interim Control By-law No. 1997-0321 -  Ontario Municipal Board, which was forwarded to Members of Council under confidential cover, such report to remain confidential in accordance with the provisions of the Municipal Act.

(Councillor Betty Disero declared her interest in the foregoing matter in that she is currently involved in a law suit in regard thereto.)

(Councillor Disero, at the meeting of City Council on May 11 and 12, 1999, declared her interest in the foregoing Clause, in that she is currently involved in a law suit in regard thereto.)

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Budget Committee embodied in the following communication (April 30, 1999) from the City Clerk:

Recommendation:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the joint report (April 14, 1999) from the Commissioner of Economic Development, Culture and Tourism and the Chief Financial Officer and Treasurer, subject to adding to the end of Recommendation No. (1) the following:

"the said amount to be within the City's updated debt and financial obligation limit."

Background:

The Budget Committee had before it a joint report (April 14, 1999) from the Commissioner of Economic Development, Culture and Tourism and the Chief Financial Officer and Treasurer, wherein it is recommended that:

(1) the 1999 Parks and Recreation Capital Works Program be amended to provide additional capital funds in the amount of $760,000.00, financed by the issuance of debentures issued for a term not exceeding 20 years, to enable the inclusion of facility and program space improvements for the Heron Park Community Centre project; and

(2) the appropriate City officials be authorized and directed to give effect thereto.

The following Members of Council appeared before the Budget Committee in connection with the foregoing matter:

- Councillor Frank Faubert, Scarborough Highland Creek; and

- Councillor Ron Moeser, Scarborough Highland Creek.

Purpose:

To request additional funding for facility and program space improvements for the Heron Park Community Centre project.

Financial Implications:

The 1999 Parks and Recreation Capital Budget would be increased by $760,000.00 from $38,444,000.00 gross to $39,204,000.00 gross, with financing to be from the issuance of debentures. Debt charges would increase by approximately $100,000.00.

Recommendations:

It is recommended that:

(1) the 1999 Parks and Recreation Capital Works Program be amended to provide additional capital funds in the amount of $760,000.00, financed by the issuance of debentures issued for a term not exceeding 20 years, to enable the inclusion of facility and program space improvements for the Heron Park Community Centre project; and

(2) the appropriate City officials be authorized and directed to give effect thereto.

Comments:

The original Feasibility Study for the Heron Park Community Centre project was approved in 1992, but the project did not receive funding approval until 1998. Due to the length of time between the original feasibility study and project approval, a review of the original program was carried out to determine that current community needs were being met. As part of the consultation process, community groups involved in the original study were invited to participate. This review was completed March 16, 1999.

Significant public concern emerged during this review that extensive work in the arena be carried out. This work includes new rink boards, repair or replacement of the concrete surrounding the ice pads, skate-resistant flooring, bleacher seating and infra-red heating. These items had previously been identified as Major Maintenance items by the former City of Scarborough and carried as an estimate in the Works Department budget. The work was scheduled to coincide with the construction of the new community centre facility. When the 1992 Heron Park project was delayed, work on these Major Maintenance items was also deferred. The currently approved funds for Heron Park Community Centre do provide for the community centre, pool replacement, etc. The Major Maintenance items were not included in this estimate and no longer appear in the Works Department Major Maintenance budget. These Major Maintenance items require a budget of approximately $500,000.00 to complete, and it is timely to do so now to minimize user impacts, gain economies of scale and better serve the public, and minimize site disruption.

Since 1992 there has also been a change in the area demographics, i.e., an increase in the number of young families and children. This has resulted in new requirements. These are: a preschool room; water play area/splashpad; and an increased area for spectator viewing in the arena. These items were not part of the original capital budget and additional funding of approximately $260,000.00 is required.

In total, an additional $760,000.00 in project funding is required as confirmed by the Architect's cost consultants. It is intended this work will be tendered in the fall of 1999.

The Department has conferred with the Chief Financial Officer and Treasurer regarding the funding of this project, and it is suggested that the city fund this work as an addition to the Capital Works Program through the issuance of debentures.

Conclusion:

In order to ensure that the arena-related work and space improvements are achieved along with the already-approved community centre project, it is recommended that this work be included in the contract documents being prepared at this time. This will minimize site disruption and public inconvenience, produce lower construction prices, and better serve the needs of the community.

Contact Names:

Frank Kershaw, Director, Policy and Development, 392-8199.

Robert Brough, Supervisor, Capital Projects, 392-8181.

(City Council on May 11 and 12, 1999, amended this Clause,by:

(1) striking out and referring Recommendation No. (3) of the Budget Committee embodied in the communication dated April 30, 1999, from the City Clerk, to the Mayor's Committee on Matters Relating to the Toronto Port Authority, for review and report thereon to the Policy and Finance Committee in June, 1999, viz.:

"(3) that Recommendation No. (1) embodied in the report (April 27, 1999) from the Chief Administrative Officer respecting the Toronto Harbour Commissioners 1999 Operating Budget, be received."; and

(2) adding thereto the following:

"It is further recommended that the data which has been brought forward by the Harbour Commission, with respect to consulting fees and travel, be reviewed by the Chief Administrative Officer, the Chief Financial Officer and Treasurer and the Auditor, and a report thereon be submitted to Council at such time as this matter is again before Council.")

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Budget Committee embodied in the following communication (April 30, 1999) from the City Clerk:

Recommendations:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council:

(1) that Recommendations Nos. (4) and (5) embodied in the report (April 27, 1999) from the Chief Administrative Officer respecting the Toronto Harbour Commissioners 1999 Operating Budget be adopted;

(2) that Recommendations Nos. (2) and (3) embodied in report (April 27, 1999) from the Chief Administrative Officer be forwarded to the Mayor's Committee on the Port Lands; and

(3) that Recommendation No. (1) embodied in the report (April 27, 1999) from the Chief Administrative Officer respecting the Toronto Harbour Commissioners 1999 Operating Budget, be received.

The Budget Committee reports, for the information of the Strategic, Policies and Priorities Committee, having requested that:

(1) the Chief Financial Officer and Treasurer, the City Solicitor and the Commissioner of Urban Planning and Development report to a joint meeting of the Mayor's Committee on the Port Lands and the Budget Committee on:

(a) the financial implications of any revised subsidy agreement on the following:

(i) TEDCO's subsidy to the Toronto Harbour Commissioners; and

(ii) the Toronto Harbour Commissioners 1999 Operating Budget;

(b) why consideration is being given to increasing staff;

(c) what is included under the heading "other"; and

(d) the significant increase in expenditures from 1998 to present; and

(2) the Chief Financial Officer and Treasurer, in consultation with the Toronto Harbour Commissioners, be requested to report back to Budget Committee for its meeting of May 25, 1999, on how the Capital Budget of the Toronto Harbour Commissioners has been re-prioritized due to the addition of two new items.

The Budget Committee also reports having received the following communications:

(a) (April 23, 1999) from Mr. Allan J. Paul, Controller and Chief Financial Officer, The Toronto Harbour Commissioners, respecting a request to revise the 1999 Capital budget; and

(b) (April 30, 1999) from Councillor Gordon Chong, Chairman, Mayor's Committee on the Port Lands.

Background:

The Budget Committee had before it a report (April 27, 1999) from the Chief Administrative Officer, forwarding the 1999 Recommended Operating Budget for the Toronto Harbour Commissioners; and providing a summary of budget highlights, outstanding issues, and recommendations.

The Budget Committee also had before it a report (April 23, 1999) from the Controller and Chief Financial Officer, Toronto Harbour Commissioners, advising that the Board of the Toronto Harbour Commissioners at its special meeting on April 22, 1999, approved revising the proposed 1999 Operating Budget by moving three projects to the 1999 Capital Budget; and further approved the following amendments:

(1) the three projects, totalling $1.025 million be moved from the proposed 1999 Operating Budget to the 1999 Capital Budget;

(2) the Toronto Harbour Commissioners be given flexibility to reprioritize projects within the approved 1999 Capital Budget to allow for these items; and

(3) the Toronto Harbour Commissioners 1999 Capital Budget will remain at the approved gross and net expenditure levels.

The Budget Committee also had before it a communication (April 30, 1999) from Councillor Gordon Chong, Chairman, Mayor's Committee on the Port Lands, advising that it is important that any reporting on the Subsidy Agreement be vetted through the Mayor's Committee on the Port Lands; and requesting that Recommendations Nos. (2) and (3) of the April 27, 1999 report from the Chief Financial Officer and Treasurer be amended to clarify that any reporting from the Chief Financial Officer and Treasurer, on Subsidy Agreement issues occur through both the Budget Committee and the Mayor's Committee on the Port Lands.

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

- Mr. Alan J. Paul, Controller and Chief Financial Officer, The Toronto Harbour Commissioners;

- Mr. Gary F. Reid, General Manager, The Toronto Harbour Commissioners; and

- Mr. John Morand, Director of Airport Operations, The Toronto Harbour Commissioners.

Purpose:

This report presents the 1999 Recommended Operating Budget for the Toronto Harbour Commissioners. A summary of budget highlights, outstanding issues, and recommendations is also provided.

Funding Sources, Financial Implications and Impact Statement:

The 1999 Recommended Operating Budget for the Toronto Harbour Commissioners Program reflects gross expenditures of $14.266 million and revenues of $11.491 million, resulting in a net budget of $2.775 million. This compares to a 1998 gross and net budget of $13.004 million and $2.775 million respectively. The 1999 gross Recommended Operating Budget is $1.262 million or 17.4 percent above the gross 1998 budget. This increase is partially offset by THC's own source revenues, resulting in a net budget that is at the level of the 1998 budget.

The THC's net budget is financed by a subsidy from TEDCO, and rent recovery from the City. As such, there is no mill rate impact resulting from the THC's 1999 Recommended Operating Budget.

For the year 2000, the business operations of the THC are expected to remain stable. The outlook for Port Operations reflects stability, with tonnage levels based on 1998. The THC expects growth at the Airport, provided the Fixed Link project continues to advance. The financial implications of these expectations have not been quantified. However, the THC does not anticipate that there will be material changes in the year 2000 from the business operations, as reflected in the 1999 budget.

Recommendations:

It is recommended that:

(1) The 1999 Recommended Operating Budget of $14.266 million gross and $2.775 million net, comprised of the following programs, be approved:

(2) With respect to the review of the management of the lands in the Port Area:

(i) the Chief Financial Officer and Treasurer review and report to the Budget Committee on the financial implications of a revised subsidy agreement; and

(Ii) the Chief Financial Officer and Treasurer report to the Budget Committee on the adjustments necessary to the approved 1999 Operating Budget, to reflect the financial implications of a revised subsidy agreement.

(3) With respect to the report from the City Solicitor (scheduled for the Budget Committee meeting of May 25, 1999) on the most appropriate process for the disposition of grants/subsidies in TEDCO's portfolio of grants/subsidies to third parties:

(i) the Chief Financial Officer and Treasurer report to the Budget Committee on the financial implications of the said report on TEDCO's subsidy to the THC;

(ii) the Chief Financial Officer and Treasurer report to the Budget Committee on the adjustments necessary to the THC's approved 1999 Operating Budget, to reflect the financial implications of the said report.

(4) With respect to the need for the THC to pursue and react to emerging business opportunities and operational issues that are not reflected in the approved budget:

(i) the THC promptly inform the City of the financial implications of material business decisions taken during the year that are not reflected in the approved operating and capital budgets, in addition to its obligation to report variances under the City's regular operating and capital budget variance reporting process;

(ii) the THC ensure that unbudgeted expenditures resulting from decisions in (i) above are fully financed from additional revenues and/or reprioritization of spending; and

(iii) the THC promptly inform the City where additional revenues are not available to fully finance unbudgeted over expenditures, in order that measures can be taken in time to minimize the impact of such over expenditures.

(5) City Council reaffirms its directive that the THC adheres to the City's financial reporting timelines in future, in accordance with the subsidy agreement between the City and the THC.

The Toronto Harbour Commissioners has the general responsibility for managing, developing and regulating the waterfront of the City of Toronto. Its mandate is to maintain and operate the commercial port, the harbour and the City Centre Airport, and to facilitate the commercial operation of four modes of transportation, with a strong emphasis on customer service.

In order to achieve its mandate and objectives, the THC is structured into three broad divisions (Programs):

(a) Port Operations;

(b) Airport Operations; and

(c) Corporate Division.

The THC has three main streams of revenue, coinciding with the divisional (program) structure, as follows:

(1) revenue from Port Operations - includes cargo tariffs, berthage, terminal-handling charges, services to ships, rentals and marina activities;

(2) revenue from Airport Operations - includes passenger user fees, landing fees, ferry charges, parking, rentals, advertising and services to aircraft; and

(3) Corporate Revenue - includes income from property, land activities and financial activities.

Discussion:

1998 Experience:

The Program's 1998 budget is over spent by approximately $2.2 million gross (16.9 percent), and $180,000.00 net (6.5 percent). This is mainly attributable to the increased costs incurred for environmental assessment relating to the fixed link to the airport, and increased consulting costs for both the fixed link and the Port Authority legislation. It should be noted, however, that revenues (excluding the subsidy) increased by approximately $2.0 million gross (15.5 percent). This is mainly attributable to:

(1) increased Port business (actual tonnage increased from the budgeted level of 1.806 million to 2.012 million i.e., a 10.2 percent increase in business, resulting an increase of $1.8 million in revenues; and

(2) higher than expected return on investments, producing higher investment income (increase of $223,000.00).

The THC board applied the additional revenues as follows, in an effort to minimize the over expenditure in 1998:

(a) to cover the cost of accommodating the additional business at the Port;

(b) address emerging issues such as additional environmental assessment work and the Port Authority legislation mentioned above; and

(c) absorb the impact of reduced passenger levels at the Toronto City Centre Airport (budgeted passengers of 167,905, compared to actual of 128,449; a reduction of 39,456 or 23.5 percent compared to the 1998 budget); this resulted in a revenue loss of approximately $423,000.00 (based on a restated budget).

The combination of reduced passenger levels in 1998, together with lower concessions and building rentals (due to delay in the start-up of airlines and the temporary cut-back in service by one airline) resulted in revenue loss at the airport of approximately $423,000.00 as mentioned above, compared to the 1998 budget. However, airport expenses were under budget by approximately $116,000.00, resulting in a net increase of approximately $300,000.00 in the deficit in airport operations (actual deficit $924,000.00, budgeted deficit $624,000.00).

In order for the City to be fully aware of the emerging issues that need to be addressed by the THC (as described above), and the financial implications of the THC's decisions in this regard, the THC should promptly inform the City when key decisions are taken by its Board. This is especially so where unbudgeted expenditures will be incurred, or unbudgeted revenues are generated. This course of action is reflected in Recommendation No. (4) of this report.

As shown in the Operating Budget Summary table above, the 1999 Recommended Operating Budget subsidy of $2.775 million net is at the same level as the 1998 budget. A concerted effort was made by the Board to reprioritize its spending projections as indicated in the draft budget that was presented to the Strategic Policies and Priorities Committee on April 16, 1999. This resulted in the subsidy request being revised to $2.775 million (the 1998 level), from an initial request of $4.285 million. In order to accomplish this, it was necessary for the THC to review some of the maintenance work included in the draft budget submission, and determine whether this could be more appropriately accommodated in the 1999 Capital Budget. This issue is addressed in a communication from the THC, dated April 23, 1999, for the Budget Committee's consideration.

A summary of the Program by expenditure is in Appendix "A".

Staffing:

No additional restructuring target was assigned to the THC for 1999. The 1999 Recommended Operating Budget provides for an additional six FTE's, as follows:

(i) two Port staff ;

(ii) one replacement for retiring airport manager;

(iii) one permanent Network Administrator);

(iv) one Health and Safety Officer; and

(v) one FTE parking attendant.

Staff costs will increase by $580,800.00 over the 1998 budget (8.9 percent), and $352,000.00 over the 1998 actual (5.2 percent). Approximately half of the increase is attributable to the six new hires shown above; the balance relates to merit increases.

The THC's staffing trend is shown in the graph below, with the above planned new staff hires reflected in 1999.

Service Overview:

The THC is organized to reflect its business operations, and has created of business units in the following Programs:

(a) Port Operations;

(b) Airport Operations; and

(c) Corporate Division.

The gross 1999 Recommended Operating Budget, reflecting the above structure, is presented in Figure 1 below. Figure 2 below shows the THC's 1999 gross Recommended budget by major category of expenditures, while Figure 3 shows its revenue budget from its main business units, and

the 1999 subsidy.

The Port and Airport are the primary drivers of business for the THC, while the Corporate division provides support and general administration to the organization.

The Port has a variety of customers, including shipping lines, shipping agents, freight forwarders, trucking lines, brokers, cargo recipients and based customers.

The Airport customers are commercial airlines, flying schools, based tenants, general aviation pilots and passengers.

The Corporate Division administers property tenants, Harbour license holders, and inquiries from the general public related to waterfront, Port and the City.

Service Adjustments:

Service Expansion/Enhancements:

The 1999 Recommended Operating Budget reflects $312,000.00 of new revenues, resulting from the Board's decision to capitalize on the additional parking business generated by the opening of the Air Canada Centre building in February, 1999. There are no other significant service expansion or enhancements reflected in the 1999 Recommended Budget. However, it is likely that the THC will need to address further emerging issues pertaining to the Port Authority legislation, and a fixed link to the airport. Both of these could have a significant impact on the THC's business.

Provincial Downloading:

Whilst Provincial downloading is not applicable to this program, it should be noted that the THC has continued to experience reductions in Federal subsidy, from $620,000.00 in 1995 to $248,000.00 in 1998. The 1999 subsidy is projected at $124,000.00, and expected to be zero in the year 2000. In presenting a 1999 budget at the 1998 level, the THC has identified the further decrease in Federal subsidy as an added pressure on its 1999 budget.

Service Delivery Adjustments Options:

Service Delivery Adjustment options were not requested from this Program.

Other Issues:

Review of Subsidy Agreement:

A committee of Council is currently reviewing options for managing the lands in the Port Area, in connection with the subsidy agreement with the THC. It is recommended that the Chief Financial Officer and Treasurer review the financial implications of any new arrangements, and report to the Budget Committee on any necessary adjustments to the 1999 approved budgets, resulting therefrom.

Due Date - Budget Submission:

During the review process, the delay in the submission of the 1999 Operating Budget was discussed at a meeting of the Board on April 22, 1999. While there may have been extraneous circumstances surrounding this, the Board recorded its apologies to the City for the delay. It is expected that the THC will adhere to the reporting and other timelines regarding the Operating and Capital budgets and other financial issues in future.

Conclusions:

The Toronto Harbour Commissioners Program's 1999 Recommended Operating Budget reflects gross expenditures of $14.266 million, revenues of $11.491 million, resulting in a net budget of $2.775 million. The net budget represents the THC's subsidy request from the City, as follows:

TEDCO $2.390 million

City $0.385 million

$2.775 million

The amounts are included in the City's 1999 approved budget, in the respective Programs.

The THC's net 1999 Recommended Operating Budget is at the level of the 1998 approved Operating Budget.

It should be noted that the THC operates in a highly competitive marketplace, and its in-year business decisions must, of necessity, reflect the dynamism of its business environment. In this regard, the THC needs the flexibility to pursue and react to emerging business opportunities and operational issues that are not reflected in the approved budget. The THC must, however, inform the City of the financial implications of the Board's decisions and strategies to address these eventualities, and make every effort to minimize any over expenditures that may result therefrom.

For the year 2000, the business operations of the THC are expected to remain stable. The outlook for Port Operations reflects stability, with tonnage levels based on 1998. The THC has indicated that growth is expected for the Airport, provided the fixed link project continues to advance.

Contact Names:

Nizam Bacchus - 397-4217; Josie LaVita - 397-4229; Shekhar Prasad - 392-8095; Wanda Liczyk - 392-8773.

Attachments:

Appendix A: Program Tables

Appendix B: Summary of Budget Review Process

Please accept this as the formal request of The Toronto Harbour Commissioners to revise its 1999 Capital Budget, moving three projects from the proposed 1999 Operating Budget to Capital. The amount budgeted for these three projects totals $1.025 million. This request is being made due to budget pressures on the City Operating budget and because these items are high priority to The Port of Toronto.

The approved 1999 Capital Budget of The Toronto Harbour Commissioners is a gross expenditure of $5.829 million with a net expenditure after recovery of $5.549 million.

The first project, East Gap Dredging, budgeted at $800,000.00 classifies as Navigational (Project No. 800). This project involves dredging approximately 50,000 cubic metres of sediment from the Eastern waterway entrance to the Inner Harbour in order to maintain seaway depth through the Main Harbour Channel. The last maintenance dredging of this channel was in 1983. This project is crucial to the ability of the Port to operate effectively and to provide a safe Harbour. Therefore, it is requested that this expenditure be moved from Operating to Capital in 1999.

The second project is also Navigational (Project No. 800). This project consists of Ship Channel Bridge Abutment Rehabilitation on both the north and south abutments including a span study, budgeted at $125,000.00. The abutments are the structural beams and slabs under the bridge, above the water line. The issue is that there is significant corrosion of these support beams, girders and reinforced concrete slabs at both ends of the bridge which will lead to load capacity restrictions or closure. If this bridge is restricted or closed, these will be no way for trucks to access the Port. Therefore, it is requested that this expenditure be moved from Operating to Capital in 1999.

The third project is a dockwall project budgeted at $100,000.00. This project involves replacing the anchorage on 100 feet of wall at Berth 512 in the Port. The anchorage or anchor rods hold the main wall to another wall 50 to 60 feet behind the facing of the main wall. These rods are failing, which threatens the wall structure. Therefore, it is requested that this expenditure be moved from operating to Capital in 1999.

The Board of the Toronto Harbour Commissioners approved revising the proposed 1999 Operating Budget, moving these projects to the 1999 Capital Budget at its special meeting of April 22, 1999. To summarize, the following amendments were approved that:

(1) the three projects, totalling $1.025 million be moved from the proposed 1999 Operating Budget to the 1999 Capital Budget;

(2) The Toronto Harbour Commissioners be given flexibility to reprioritize projects within the approved 1999 Capital Budget to allow for these items; and

(3) the Toronto Harbour Commissioners 1999 Capital Budget will remain at the approved gross and net expenditure levels.

If there are any questions, please call me at (416) 863-2082.

As you are aware, City Council on April 13, 14 and 15, 1999, adopted Clause No. 2 of Report No. 7 of The Strategic Policies and Priorities Committee, recommending amongst other things that a Committee be established to review options for managing the lands in the Port Area in connection with the elimination of the Subsidy Agreement.

It is important that any reporting on the Subsidy Agreement be vetted through the Mayor's Committee on the Port Lands. Accordingly, I am requesting that Recommendations Nos. (2) and (3) of the April 27, 1999 report of the Chief Administrative Officer be amended to clarify that any reporting from the Chief Financial Officer and Treasurer on Subsidy Agreement issues occur through both the Budget Committee and Mayor's Committee on the Port Lands.

(Copies of Appendices "A" and "B" referred to in the foregoing report; and the Toronto Harbour Commissioners Revised 1999 Operating Budget, were forwarded to all Member of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee; and copies thereof are also on file in the office of the City Clerk.)

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Budget Committee embodied in the following communication (April 30, 1999) from the City Clerk:

Recommendation:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (March 16, 1999) from the Commissioner of Works and Emergency Services, wherein it is recommended that:

(1) the City not proceed with the unilateral termination of all existing Industrial Waste Surcharge Agreements by January 1, 2000;

(2) subject to approval of Recommendation No. (1), the current Compliance Program with Monetary Concession Policy be expanded to include not only new surcharge companies and existing surcharge companies facing substantial increase in surcharge, but also existing surcharge companies wishing to reduce or eliminate their surcharge assessments; and

(3) also subject to approval of Recommendation No. (1), the Committee adopt the recommendations contained in the report dated November 20, 1998, from the Commissioner of Works and Emergency Services, entitled "Industrial Waste Surcharge Agreement - Pizza Pizza Limited, 58 Advance Road", with terms and conditions satisfactory to the City Solicitor and the Commissioner of Works and Emergency Services.

Background:

The Budget Committee had before it a report (April 21, 1999) from the City Clerk, advising that the Works and Utilities Committee on April 21, 1999, recommended to the Budget Committee the adoption of the report dated March 16, 1999, from the Commissioner of Works and Emergency Services, wherein it is recommended that:

(1) the City not proceed with the unilateral termination of all existing Industrial Waste Surcharge Agreements by January 1, 2000;

(2) subject to approval of Recommendation No. (1), the current Compliance Program with Monetary Concession Policy be expanded to include not only new surcharge companies and existing surcharge companies facing substantial increase in surcharge, but also existing surcharge companies wishing to reduce or eliminate their surcharge assessments; and

(3) also subject to approval of Recommendation No. (1), the Committee adopt the recommendations contained in the report dated November 20, 1998, from the Commissioner of Works and Emergency Services, entitled "Industrial Waste Surcharge Agreement - Pizza Pizza Limited, 58 Advance Road", with terms and conditions satisfactory to the City Solicitor and the Commissioner of Works and Emergency Services.

Recommendation:

The Works and Utilities Committee on April 21, 1999, recommended to the Budget Committee the adoption of the report dated March 16, 1999, from the Commissioner of Works and Emergency Services respecting Industrial Waste Surcharge Agreements.

Background:

The Works and Utilities Committee on April 21, 1999, had before it a report (March 16, 1999) from the Commissioner of Works and Emergency Services recommending that:

(1) the City not proceed with the unilateral termination of all existing Industrial Waste Surcharge Agreements by January 1, 2000;

(2) subject to approval of Recommendation No. (1), the current Compliance Program with Monetary Concession Policy be expanded to include not only new surcharge companies and existing surcharge companies facing substantial increase in surcharge, but also existing surcharge companies wishing to reduce or eliminate their surcharge assessments; and

(3) also subject to approval of Recommendation No. (1), the Committee adopt the recommendations contained in the report dated November 20, 1998, entitled "Industrial Waste Surcharge Agreement - Pizza Pizza Limited, 58 Advance Road", with terms and conditions satisfactory to the City Solicitor and the Commissioner of Works and Emergency Services.

The Committee also had before it a the following communications:

(i) (March 30, 1999) from the City Clerk advising that the Budget Committee on March 29, 1999, referred the report dated March 16, 1999, from the Commissioner of Works and Emergency Services respecting Industrial Waste Surcharge Agreements, to the Works and Utilities Committee for further consideration, to report thereon to the Budget Committee with a request that, when considering Recommendation No. (2) from a budgetary point of view, the same levels as 1998 be maintained;

(ii) (April 7, 1999) from the City Clerk advising that the Economic Development Committee on March 29 and April 6, 1999, had before it the report dated March 16, 1999, from the Commissioner of Works and Emergency Services respecting Industrial Waste Surcharge Agreements, and that the Economic Development Committee supports the adoption of such report;

(iii) (January 29, 1999) from Ms. Anne Dubas, President, Local 79, Canadian Union of Public Employees, expressing concern with respect to the implications of the recommendations of the Works and Utilities Committee that Industrial Waste Surcharge Agreements with existing industries be terminated by January 1, 2000; and noting that the agreements allow industries to discharge non-toxic wastes provided that they can be treated at the City's treatment plants, at a fee to offset operational costs of the plants, rather than through the purchase of their own individual, costly equipment;

(iv) (February 1, 1999) from Mr. Frank Ingratta, Deputy Minister, Ministry of Agriculture, Food and Rural Affairs, advising that any proposal to replace Industrial Waste Surcharge Agreements with an increased fee structure would have significant competitive implications to food processors in the City of Toronto; and noting that the beverage, brewery, confectionery, dairy, fruit and vegetable and meat processing sectors would all face significant cost increases on municipal water and wastewater charges which would make the food processing sector, one of Toronto's largest employers, uncompetitive, and which could lead to plant closures and reduce Toronto's ability to attract new food investment;

(v) (February 1, 1999) from Mr. Russell Tabata, Director, Operations, Molson Breweries - Etobicoke, expressing concern with respect to the lack of consultation prior to the recommendation with regard to the elimination of sewer surcharges being presented to Toronto City Council; noting that Molson Breweries has been actively pursuing effluent reduction initiatives and has made significant progress towards reducing loading to the municipal sewer system, and further, that through a co-operative relationship with Toronto Works and Emergency Services, the surcharge agreement has provided a very effective and responsible strategy for the management of the treatable waste from the Etobicoke Brewery; and requesting the opportunity to meet with the Committee and staff to discuss this issue further;

(vi) (February 2, 1999) from Mr. Ken W. Holmes, Vice President - Operations, Campbell Soup Company Ltd., urging that the recommendation to terminate existing sewer surcharge agreements, and any related actions, be withdrawn immediately and deferred to permit a full dialogue between the City of Toronto and the affected businesses; expressing concern that there has been no consultation on this proposal and no notice of the City's intention to make changes to the Industrial Waste Surcharge Agreement; and advising that the sudden cancellation of this agreement does not permit sufficient time to identify and implement cost effective alternatives and, if adopted, will severely impact the future operation of the Toronto plant;

(vii) (February 23, 1999) from Mr. Charles Buehler, President, Organic Resource Management Inc., advising that the recommendations of the Works and Utilities Committee at its meeting of January 13, 1999, with respect to Industrial Waste Surcharge Agreements, are unnecessary and financially damaging to many industries, in particular the food processing industries; and providing a background on municipal wastewater treatment services for the food processing and food services sectors, and arguments for maintaining the current system of agreements;

(viii) (April 21, 1999) from Ms. Karen Buck, Toronto, Ontario, respecting the financial implications of terminating Industrial Waste Surcharge Agreements and making recommendations with respect thereto; and

(ix) (April 21, 1999) from Ms. Karey Shinn, Chair, Safe Sewage Committee, expressing concerns with respect to Industrial Waste Surcharge Agreements and the draft Sewer User By-law.

Purpose:

To advise the Committee of the various impacts which would result from a unilateral termination of all existing Industrial Waste Surcharge Agreements by January 1, 2000.

Funding Sources, Financial Implications and Impact Statement:

Terminating all existing Industrial Waste Surcharge Agreements will mean the loss of approximately $8 million per year in revenue.

Recommendations:

It is recommended that:

(1) the City not proceed with the unilateral termination of all existing Industrial Waste Surcharge Agreements by January 1, 2000;

(2) subject to approval of Recommendation No (1), the current Compliance Program with Monetary Concession Policy be expanded to include not only new surcharge companies and existing surcharge companies facing substantial increase in surcharge but also existing surcharge companies wishing to reduce or eliminate their surcharge assessments; and

(3) also subject to approval of Recommendation No. (1), the Committee adopt the recommendations contained in the report (November 20, 1998) from the Commissioner of Works and Emergency Services, entitled "Industrial Waste Surcharge Agreement- Pizza Pizza Limited, 58 Advance Road", with terms and conditions satisfactory to the City Solicitor and the Commissioner of Works and Emergency Services.

Council Reference/Background/History:

City Council on February 2, 3 and 4, 1999, had before it Clause No. 4 of Report No. 1 of The Works and Utilities Committee, entitled "Industrial Waste Surcharge Agreement - Pizza Pizza Limited", wherein it is recommended that:

(1) the report dated November 20, 1998, from the Commissioner of Works and Emergency Services be adopted;

(2) the Commissioner of Works and Emergency Services be requested to advise those industries with existing Industrial Waste Surcharge Agreements that such agreements will be terminated by January 1, 2000, and that staff provide assistance wherever possible similar to that provided to Nestlé Canada Inc. in cleaning up sewer discharge; and

(3) no further agreements be approved.

The Works and Utilities Committee reports, for the information of Council, having requested the Commissioner of Works and Emergency Services to:

(1) send out the Nestlé Canada Inc. model to all those companies that have Industrial Waste surcharge Agreements with the City of Toronto, with a suggestion that the City would be willing to negotiate similar initiatives; and to invite all parties to a workshop or forum on this topic in order to provide information to such industries regarding strategies for reducing industrial waste; and

(2) submit a report to the Committee on:

(i) the banning, as well as phasing out, of such agreements;

(ii) the deployment of staff presently engaged in auditing industrial and commercial operations; and

(iii) the doubling of fees charged, in the interim.

Council also had before it, during consideration of the aforementioned Clause, a report (January 29, 1999) from the City Solicitor advising Council of the legal implications of the unilateral termination by the City of all existing Industrial Waste Surcharge Agreements by January 1, 2000.

Council also had before it, during consideration of the aforementioned Clause, the following communications with respect to the implications of the recommendations of the Works and Utilities Committee regarding the waste surcharge agreement with Pizza Pizza and other existing Industrial Waste Surcharge Agreements:

(i) (January 29, 1999) from Ms. Anne Dubas, President, CUPE Local 79; and

(ii) (February 2, 1999) from Ken W. Holmes, Vice-President, Operations, Campbell Soup Company Limited.

Council struck out and referred this Clause back to the Commissioner of Works and Emergency Services for further consideration and report thereon to the Works and Utilities Committee; and Council directed that the Commissioner of Works and Emergency Services also submit a copy of such report to the Economic Development Committee for comment thereon to the Works and Utilities Committee.

Further, the Budget Committee, at its meeting held on March 5, 1999, had before it a report (March 3, 1999) from the Chief Administrative Officer on the subject of the Water and Wastewater 1999 Operating Budget, recommending, among other matters that:

(5) the General Manager, Water and Wastewater Services Division, in consultation with the Chief Financial Officer and Treasurer, report back to the Budget Committee on the overall financial impact of the termination of industrial waste agreements.

Comments and/or Discussion and/or Justification:

By-law No. 153-89 establishes wastewater sewer discharge limits and prohibits the discharge of certain toxic materials. The by-law also allows for the limits of suspended solids and biochemical oxygen demand (BOD), which are treatable at our treatment plants, to be exceeded if the company is willing to enter into a surcharge agreement to pay for the additional cost of treatment. No surcharge agreement is allowed for the discharge of untreatable wastes such as heavy metals. About 85 percent of the companies with surcharge agreements with the City are in the food processing sector, e.g., dairy processing, tofu processing, slaughterhouse, brewery, candy production, sugar refining, cake and pastry production, etc. The remaining 15 percent is a mixture of industrial and commercial launderers, used paper recyclers, and household cleaning and personal care product manufacturers. Their discharges are high in organic matter which is treatable waste at each of the Water Pollution Plants and not detrimental to the quality of sewage sludge.

The Committee's recommendations to unilaterally terminate all existing Industrial Waste Surcharge Agreements and not allow any further agreements to be approved by January 1, 2000, will impact industries in the following ways:

(1) most industries would be unable to arrange for alternative treatment on site or to make other alternative arrangements due to the short notice period proposed;

(2) those that are unable to arrange for alternative treatment on site to meet the by-law limits by January 1, 2000, will immediately face prosecution under By-law No. 153-89;

(3) we are aware of treatment systems costing as much as $10 million in capital costs and $2 million in annual operating costs; seventy percent of the companies with surcharge agreements are paying less than $30,000.00, while most small biological treatment systems (e.g., biofilters) can cost between $100,000.00 to $300,000.00, not including the annual operating and sludge disposal costs; and a number of small companies may find the capital and operating costs for on-site treatment prohibitive;

(4) it may also be very difficult for many industries to install effluent treatment systems to comply with the by-law due to space limitations;

(5) the purpose of surcharge agreements is to avoid the proliferation of small private sewage treatment plants throughout the community for biological treatment; these plants may have problems with odours or upsets due to the less efficient biological treatment provided at small plants when compared to a centrally operated sewage treatment plant;

(6) industries operating biological treatment systems will be required to transport sludge from these plants through their local communities to disposal locations, thus increasing truck traffic and air pollution; and

(7) effluents from food processing firms, which account for 85 percent of our surcharge companies, are best treated by a biological plant similar to our sewage treatment plants; and Agriculture Canada, due to health reasons, will not allow such a plant to be located in the same facility.

It is true that in November 1986, the Region of Peel considered requiring any new industry moving into Peel since 1986 to meet the sewer use by-law limits (i.e., no surcharge agreement allowed) and terminating all surcharge agreements in January, 1990. They had to abandon this policy on September 11, 1989, due to serious negative economic implications.

On the issue of deployment of staff presently engaged in auditing industrial and commercial operations, we anticipate that with all the 157 surcharge companies without a surcharge agreement come January 1, 2000, a majority of them will not be in compliance of the by-law and we need the resources to enforce the by-law. Currently we have 22 inspectors, and 33 percent of their work involves sampling, negotiating and maintaining surcharge agreements. The remaining 66 percent of their work involves enforcing the by-law on those companies that are not eligible for surcharge plus finding new companies who can be put on surcharge.

The City Legal Department has advised that the current policy for administering the Compliance Program with Monetary Concession is not equitable in that it is only available to companies entering into new surcharge agreements and existing surcharge companies facing substantial increase in surcharge costs. Consequently, it is proposed to expand our current Compliance Program with Monetary Concession Policy to include all existing surcharge companies wishing to reduce or eliminate their surcharges.

We, therefore, propose the following guidelines for considering applications for Compliance Program with Monetary Concession:

(1) all companies who have existing surcharge agreements, including new companies seeking their first agreement and companies facing substantial increase in their surcharge costs, are eligible to apply;

(2) the applicant must commit in writing, in the form of a Compliance Program with specific program activities, commencement dates, completion dates and program costs, to reduce their waste loading by up to 50 percent;

(3) the reduction in surcharge could be for a period of between one and three years, depending on the time required to complete the program for waste reduction;

(4) pollution prevention would be the preferred option for waste reduction; end-of-pipe treatment would be approved only if there are no pollution prevention options available;

(5) an applicant can only be granted one Compliance Program with Monetary Concession per lifetime; and

(6) at the end of the Compliance Program period, the companies who are unsuccessful in reducing their waste loading to within by-law limits must resume paying surcharge based on the actual waste loading at that time.

Potentially we could lose $4 million of the $8 million revenue if all the existing companies with surcharge agreements take advantage of this new policy, but realistically, the true financial impact is hard to predict, as a majority of food processing companies will not be able to install biological treatment systems on site due to Health Canada regulations. Further, some industries may find the capital expenditures to provide on-site treatment cannot be justified given the economic incentives the City provides under the Monetary Concession Program.

Financial Impact:

We currently have 157 Industrial Waste Surcharge Agreements with companies across the new City. These agreements result in the annual revenue of approximately $8 million. We have consulted with the Finance Department, and they have advised that with the termination of these agreements there will be an impact of about two percent on the water rate.

Also, without the surcharge agreements we would have no revenue to support the Compliance Program with Monetary Concession policy (the "Nestlé Canada Inc. Model") to rebate companies up to 50 percent of their surcharge if they wish to reduce or eliminate their surcharge by installing wastewater treatment systems.

Potential Impact on Biosolids Quality:

The majority of our surcharge industries are food processors, e.g., dairy products, tofu processing, meat and fish processing, etc. Their wastes contain, in addition to high organic wastes (BOD) which we surcharge, nitrogen in both organic and inorganic forms, which ends up in biosolids. This enhances biosolids nutrient content and makes it more desirable for beneficial use. Ontario's Guideline for the Utilization of Biosolids and Other Wastes on Agricultural Land determines whether biosolids are acceptable for beneficial use based on nitrogen to metal ratios. By eliminating all existing surcharge agreements, with the majority of them in the food sector discharging high nitrogen bearing wastes, will result in a reduction in the nitrogen content of our biosolids. With beneficial use we must pay particular attention to the nutrient content of the biosolids, otherwise it would undermine our current plan to eliminate incineration and get into the beneficial reuse of biosolids.

Legal Implications:

Under the terms of the surcharge agreement, the City may terminate the agreement at any time only where there is an emergency situation of immediate threat to any person, property, plant or animal life, or waters. This is not the case with the present surcharge agreements.

The City Solicitor submitted a report (January 29, 1999) to City Council on February 2, 3 and 4, 1999, in which he concluded that "If all the Industrial Waste Surcharge Agreements were terminated by January 1, 2000, as recommended by the Works and Utilities Committee, the City would be open to a large number of claims for breach of contract, and could be liable to pay a substantial amount of damages to those with whom it had entered into Industrial Waste Surcharge Agreements. If the City wished to terminate all existing Surcharge Agreements, it would have to provide a reasonable period of notice to the affected parties."

The City Solicitor also advised Council that if the City tries to drastically increase the fee charged in the interim, this approach could likely be successfully challenged. The Supreme Court of Canada has recently held that the amount of a fee charged for a service provided must bear a reasonable connection to the cost to the City in providing that service.

Economic Development Impact:

The purpose for the economic incentives under our Compliance Program with Monetary Concession Policy was to provide industries with the opportunity to upgrade their facilities to minimize their surcharge. By terminating all surcharge agreements, industries would not be able to take advantage of the economic incentives provided under the Compliance Program with Monetary Concession Policy as we would have no revenue to support such a program. Similarly, the Compliance Program with Monetary Concession allows a three-year phase-in, whereas the proposal to terminate surcharge agreements by January 1, 2000, is only months away.

We have consulted with the Economic Development, Culture and Tourism Department and they have advised that depending on the cost of on-site treatment versus the surcharge costs, Toronto industries may have a competitive disadvantage compared with industries in other municipalities. Without any economic incentives, a majority of surcharge companies will find the cost of installing a treatment system prohibitive. By denying industries the choice of entering into a surcharge agreement with the City, many industries will be forced to terminate their operations in Toronto and potentially move to other jurisdictions that allow surcharge agreements, such as the Regions of Peel, York, Durham, Halton, and Hamilton-Wentworth.

Conclusions:

The 157 companies with agreements need time to assess their potential for, and legal position of, installing on-site treatment. The City needs to take a proactive approach with the companies and offer them options and solutions to their discharges that exceed our current by-law limits. In this regard, staff could undertake both a communication plan and an education workshop or forum on this issue if the recommendations in this report are approved.

The Committee should not proceed with the termination of all existing Industrial Waste Surcharge Agreement by January 1, 2000, for the reasons noted above. Further, it is recommended that for equity reasons, all existing surcharge companies be considered under the Compliance Program with Monetary Concession Policy.

Contact Name:

Mr. Vic Lim, P.Eng., Manager, Industrial Waste and Storm Water Quality, Quality Control and System Planning, Telephone: (416) 392-2966; Fax: (416) 397-0908, e-mail: vic_lim@metrodesk.metrotor.on.ca.

"Industrial Waste Surcharge Agreement

- Pizza Pizza Limited, 58 Advance Road"

addressed to the Works and Utilities Committee

from the Commissioner of Works and Emergency Services)

Purpose:

To allow Pizza Pizza Limited to enter into an Industrial Waste Surcharge Agreement with the City of Toronto permitting them to discharge overstrength effluent which is amenable to treatment at our treatment plants and pay a surcharge fee.

Funding Sources, Financial Implications and Impact Statement:

This Department maintains approximately 157 Industrial Waste Surcharge Agreements, which allow for the recovery of approximately $7.5 million per year in additional treatment costs. These charges reflect a user pay philosophy and directly offset the cost of the operation of our treatment plants.

Recommendation:

It is recommended that we be authorized to enter into an Industrial Waste Surcharge Agreement with Pizza Pizza Limited, 58 Advance Road, under terms and conditions satisfactory to the City Solicitor and the Commissioner of Works and Emergency Services.

Council Reference/Background/History:

On November 9, 1989, Metropolitan Council, by adoption of Clause No. 6 of Report No. 16 of The Works Committee, authorized execution of agreements with industries, permitting them to discharge wastewater in excess of the limits set out under By-law No. 153-89, providing that the overstrength discharges are amenable to treatment at our treatment plants. Industries are required to pay for the additional cost of treatment above the limit of the by-law.

Comments and/or Discussion and/or Justification:

The type of waste generated by Pizza Pizza Limited is biodegradable and amenable to treatment at our Humber Treatment Plant.

This company has been notified of the annual charge to be levied, and has signified agreement to the amount of the assessment:

Annual Excess

Yearly Plant Waste By-law

Effective Surcharge Discharge Strength Limit

Date $ m³ mg/L mg/L

Pizza Pizza Limited Jan. 1, 1998 $7,167.11 13,751 922 350

SS SS

The alternative to an Industrial Waste Surcharge Agreement would be to force the industry to comply with the Sewer Use By-law limit for suspended solids (SS) and biochemical oxygen demand (BOD), by the addition of effluent pretreatment equipment. This would be an impossibility for many companies due to financial and/or space limitations. Those industries that could afford to install pretreatment systems may have problems with odours or upsets. The Ministry of the Environment acknowledges the need for surcharge agreements in their Model Sewer Use By-law (1988).

Conclusions:

The overstrength effluent from the above industry is organic in nature, biodegradable and amenable to treatment at our treatment plants.

In accordance with Section (5) of our Sewer Use By-law No. 153-89, an Industrial Waste Surcharge Agreement should be established with the above industry to provide a mechanism by which the overstrength effluent which exceeds the by-law limit for SS can be discharged on a fee basis.

Contact Name:

Vic Lim, P.Eng., Chief Engineer - Environmental Services, Water Pollution Control,

Telephone: (416) 392-2966; Fax: (416) 397-0908, E-mail: victor_lim@metrodesk.metrotor.on.ca.

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Budget Committee embodied in the following communication (April 30, 1999) from the City Clerk:

Recommendation:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the communication (April 29, 1999) from the City Clerk, wherein it is recommended that:

(1) the owners of 53 and 55 Douglas Crescent be offered a lumpsum payment of $30,000.00 ($15,000.00 to each property owner) in full settlement of all claims known or which could be reasonably known to the owners against the City with respect to the easement, the City works located within the easement, the damages to the easement and adjoining lands and buildings and incidental damages;

(2) the settlement funds include the cost of replacing the semi-detached garages by the owners;

(3) the City will undertake all necessary restoration work of the driveway and landscaping damaged by the restoration and repair work;

(4) the owner be required to execute a release satisfactory to the City Solicitors; and

(5) the City provide the owners with an engineering opinion, on the completion of all restoration and repair work, confirming that the work on stabilizing the soils and completing the underground repairs since September 1996, has not had a detrimental impact on the adjoining residential buildings, namely, 53 and 55 Douglas Crescent.

Background:

The Budget Committee had before it a communication (April 29, 1999) from the City Clerk advising that the East York Community Council on April 28, 1999, unanimously recommended to the Budget Committee and Council, the adoption of the confidential report (April 27, 1999) from Mr. C.M. Loopstra, Q.C., Loopstra, Nixon and McLeish, Solicitors for the East York Office.

Recommendation:

The East York Community Council on April 28, 1999, unanimously recommended to the Budget Committee and Council, the adoption of the following recommendations embodied in the confidential report (April 27, 1999) from Mr. C.M. Loopstra, Q.C., Loopstra, Nixon and McLeish, Solicitors for the East York Office:

(1) that the owners of 53 and 55 Douglas Crescent be offered a lumpsum payment of $30,000.00 ($15,000.00 to each property owner) in full settlement of all claims known or which could be reasonably known to the owners against the City with respect to the easement, the City works located within the easement, the damages to the easement and adjoining lands and buildings and incidental damages;

(2) that the settlement funds include the cost of replacing the semi-detached garages by the owners;

(3) that the City will undertake all necessary restoration work of the driveway and landscaping damaged by the restoration and repair work;

(4) that the owner be required to execute a release satisfactory to the City Solicitors; and

(5) that the City provide the owners with an engineering opinion, on the completion of all restoration and repair work, confirming that the work on stabilizing the soils and completing the underground repairs since September 1996, has not had a detrimental impact on the adjoining residential buildings, namely, 53 and 55 Douglas Crescent.

Background:

The East York Community Council had before it a confidential report (April 27, 1999) from Mr. C.M. Loopstra, Q.C., Loopstra, Nixon and McLeish, Solicitors for the East York Office.

The following persons appeared before the East York Community Council in connection with the foregoing matter:

- Mr. Don Cashen, East York; and

- Mr. Randy Eadie, Jasamax Holdings, Markham.

The Strategic Policies and Priorities Committee reports, for the information of Council, that only the recommendations embodied in the confidential report (April 27, 1999) from the City Solicitor, East York Office, were made public; and that a copy of the entire aforementioned confidential report was forwarded to all Members of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee and the May 11, 1999, agenda of City Council, such report to remain confidential in accordance with the provisions of the Municipal Act.

(City Council on May 11 and 12, 1999, amended this Clause, by adding thereto the following:

"It is further recommended that the report dated May 10, 1999, from the Chief Financial Officer and Treasurer, entitled '3 Nassau Street - Exemption from Phase-in By-law', embodying the following recommendation, be adopted:

'It is recommended that authority be granted for the introduction of a Bill in Council, substantially in the form of the draft by-law attached hereto as Appendix "A", to amend By-law No. 966-1998.' ")

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Assessment and Tax Policy Task Force, embodied in the following communication (May 3, 1999) from the City Clerk:

Recommendation:

The Assessment and Tax Policy Task Force recommends that By-law No. 966-1998 be amended to include any change in classification between 1997 and 1998, such that the property is reflected as residential/farm for 1998.

Background:

The Assessment and Tax Policy Task Force, on May 3, 1999, had before it a report (April 22, 1999) from the Chief Financial Officer and Treasurer, recommending that Council not approve the request to grant an exemption from the residential phase-in program for 3 Nassau Street as there has been no change in classification of this property between the 1997 and 1998 tax years.

The Task Force also had before it communications (March 18, 1999) from Mr. Alex Spiegel, Context Development Inc., and (March 29, 1999) from Mr. James Julien, Kensington Market Working Group.

The Task Force's recommendations are noted above.

(Report dated April 22, 1999, addressed to the

Assessment and Tax Policy Task Force from the

Chief Financial Officer and Treasurer, entitled

"Request for Exemption from Phase-in - 3 Nassau Street")

Purpose:

This report provides additional information regarding the request of the owners of 3 Nassau Street that the property be excluded from the provisions of the City's 1998 residential phase-in program.

Financial Implications:

Exclusion of 3 Nassau Street from the residential phase-in will result in an estimated $267,125.00 in taxes foregone in 1998 and $200,342.00 in 1999. The total amount of taxes foregone over the five year phase-in will be $667,806.00.

Recommendation:

It is recommended that Council not approve the request to grant an exemption from the residential phase-in program for 3 Nassau Street as there has been no change in classification of this property between the 1997 and 1998 tax years.

Comments:

At its meeting on April 1, 1999, the Assessment and Tax Policy Task Force had before it communications from McCarthy Tetrault, solicitors for the developers of 3 Nassau Street and Context Development Ltd, the manager of this condominium conversion project. The property owners, citing similarity to the request pertaining to 188 Eglinton Avenue East, are requesting that Council exclude this property from the residential phase-in program as adopted by City Council in July 1998. Copies of the communications are attached for information.

The property in question was purchased from George Brown College in April 1997. Prior to this transfer, the property, being owned by a college, was exempted from property taxes in accordance to paragraph 4 of subsection 3 (1) of the Assessment Act.

The Regional Assessment Office (now the Ontario Property Assessment Corporation or "OPAC") issued a supplemental assessment notice to the new owner changing the exempt tax status to a taxable status effective April 8, 1997. The former City of Toronto, upon receiving this supplemental notification, issued a supplemental tax bill on June 10, 1997, for the amount of $365,298.22 which is the pro-rated amount based on a realty assessment of $1,051,000.00 times the 1997 residential public mill rate of 473.37.

When the supplementary assessment was issued, changing the status of the property from exempt to rateable, the 1997 assessed value became eligible for appeal. As noted in the communication from the property owners' solicitors, the 1997 supplementary assessment reflected the historic assessment returned against the College, which had never been tested because the property was exempt from taxation. As a result, the supplementary assessment (based on 1940 market values) issued against the new owners was extremely high in comparison to the actual purchase price.

The solicitors for the property owner have also stated that, during discussions with OPAC to resolve the appeal, they compromised significantly with respect to the 1997 value because the proposed 1998 value was reasonable. They were also advised by OPAC staff that it was their expectation (without guarantees) that the property would not be subject to phase-in. In 1998, a settlement on the 1997 and 1998 values for the property was reached, and on May 11, 1998, the Assessment Review Board reduced the 1997 realty assessment from $1,051,00.00 to $802,400.00 effective April 8, 1997.

The property at 3 Nassau Street is a condominium conversion project, which will consist of 138 residential units and 8 commercial units. OPAC staff have advised that the property was visited by an assessor on December 22, 1997. At that time, the model suites were completed and marketing of the project was well underway. Construction on the other condominium suites commenced early in 1998. A partial CVA assessment of $3.708 million was placed on the 1998 assessment roll. In December 1998, an amended assessment notice was issued, increasing the assessment of the property to $16.60 million, which represents 75 percent of the full CVA value when the project is complete. It is anticipated that a further increase in assessment will occur during 1999, for taxation in 2000, bringing the total estimated assessment of the property to $22.13 million.

Appendix 1 shows the impact on the taxes for 3 Nassau Street for 1998 through 2003, with phase-in and without phase-in. The total 1998 assessment-related tax decrease that is being phased-in over 5 years is $333,905.00, with an annual tax decrease due to the phase-in of $66,780.00. However, because the property has only been partially assessed, the tax decreases due to the phase-in will be offset by non-phaseable tax increases due to increases in the CVA assessment as the property gradually becomes fully assessed. As noted above, it anticipated this will occur for taxation in the year 2000. At that point, the average taxes per unit with the phase-in will be $2,825.00, compared to $1,910.00 if the property is excluded from the phase-in program.

The similarity between the 3 Nassau Street property and 188 Eglinton Avenue East property is that, in both cases, the conversion of the properties from non-residential to residential uses started in late 1997. However, the major difference in the circumstances for these two property is that the 188 Eglinton property was assessed and taxed as a commercial office building in 1997. The 1997 taxes for 188 Eglinton included commercial realty taxes and business taxes. For 1998, the 188 Eglinton property was classified as residential (after the OPAC correction), resulting in a change in classification between 1997 and 1998. Conversely, the 3 Nassau Street property was assessed and taxed as residential in 1997.

The main issue with respect to 3 Nassau Street is the high 1997 assessment and resulting high tax level from which the CVA decrease is being phased-in. In this regard, it is unfortunate that, when the new owners of the property had the opportunity to appeal the 1997 assessment appeal, a lower 1997 assessment was not negotiated that more accurately reflected a 1940's based market value.

It should be noted that when this project is registered as a condominium (likely in late 1999 or early 2000), OPAC will apportion the CVA assessment among the individual condominium units for taxation in the following year. When the apportionment of assessment occurs, and the condominium units are assessed as separate portions, the phase-in will no longer apply. As a result, it is expected that the owners of the condominiums will have their taxes reduced to the lower CVA level prior to the end of the phase-in program and as early as 2000.

Conclusion:

The use and classification of the property at 3 Nassau Street was changed from that of a college (exempt from taxation) to residential in 1997. The property was also reflected on the returned assessment roll for 1998 taxation as residential. With the property being classified and taxed correctly in the residential class for both 1997 and 1998, it is inappropriate to exclude this property from the phase-in program.

When the project is registered as a condominium and OPAC assesses each of the condominium units separately, the phase-in will no longer apply and the individual condominium owners will benefit from the lower CVA taxes. This could occur as early as 2000. However, due to the phase-in program, the developer will not benefit from the full CVA decrease.

Contact Names:

Lynne Ashton, 397-4203

Bill Wong, 392-9248

(Communication dated March 18, 1999, addressed to

Councillor John Adams, Chair, Assessment and Tax

Policy Tax Force from Mr. A. Speigel, Context Development Inc.)

Context Development Ltd. Is the manager of a residential conversion development project in Kensington Market. Our building was previously in non-residential use as George Brown College Kensington Campus. When it became surplus to the college's needs, we acquired it for conversion to residential use. We received community and City support for this project in accordance with the Kensington Market Action Plan.

For assessment purposes, the property became taxable for the first time in 1997, and paid taxes at the commercial rate in that year. Assessment staff re-classified it as residential in 1998. Our tax bills indicate that the resulting tax decrease is being phased in over five years.

Almost identical circumstances arose previously in the case of a property at 188 Eglinton Avenue East. Late last year, Council excluded that property from the phase-in program. The only apparent difference between the two properties is that our property was correctly classified as residential on the assessment roll for taxation in 1998, whereas the Eglinton property was initially (and incorrectly) classified as commercial on that roll (later corrected to residential).

The City Treasurer's report on the Eglinton property (a copy of which is appended for reference) persuasively outlines the key issues, making it clear that the intent of the phase-in program was phasing in of assessment-related tax changes, not tax changes due to reclassification. Section 372 (6) of the Municipal Act provides authority to exclude properties from phase-in in circumstances such as re-classification of property under the Assessment Act. Council relied on this provision in excluding the Eglinton property from phase-in.

In her report, the City Treasurer describes the by-law subsequently enacted by Council in these terms:

"The attached draft by-law, if enacted, would exclude (from phase-in) all properties which were re-classified as residential/farm for the 1998 taxation year. This approach would preclude the need for additional by-laws to further preclude (sic) any property which fits the above-mentioned criteria."

(From the context, it is clear that the second use of "preclude" is a typo, with "exclude" having been intended.) As has been noted, our property was re-classified as residential/farm for the 1998 taxation year and thus clearly falls within Council's intended criteria for exclusion form phase-in. Why, then, is it necessary for us to make a site-specific application for exclusion?

Unfortunately, the staff objective as cited above was frustrated by incorporation into the by- law of a requirement that the 1998 classification had to be initially in error. No reason is provided for this requirement in the report, or in the "whereas" recitations of the by-law. The requirement appears to be immaterial.

This 'initial-in-error" requirement makes the enacted by law more site-specific that general - so far as is known, only the Eglinton property complies. As has been emphasized, it is the reclassification from commercial (in 1997) to residential (in 1998) that is material, not whether it was done correctly in the first instance. The Eglinton property's need for a by-law to exclude it from phase-in would have been just as evident (and justified) had the classification error never occurred.

We are requesting the Task Force to provide the same relief that was provided to 188 Eglinton Avenue East. This would be best effected by amending the by-law (enacted by Council at its December 16-17 meeting) to give effect to Council's evident intent, namely to exclude from the phase-in program all properties which were re-classified as residential/farm for the 1998 taxation year, such exclusion to begin with that year (as was done with the Eglinton property) and that the necessary staff reports be made available for consideration at the next scheduled Strategic Policies and Priorities Committee.

If our property is not excluded from phase-in, a gross inequity will arise between our residents (indeed all residents in conversion properties) and those of the Eglinton property. The residents of 188 Eglinton E. will be paying taxes at the 1.26 percent residential tax rate from day one, while the residents Of 3 Nassau Street will pay a phase-in adjustment on top of that rate - initially as much as $3,000.00 per unit annually in additional taxes, and not phasing out completely until the year 2003.

The majority of purchasers at Kensington Market Lofts are first time buyers, dependent on C.M.H.C. Mortgage Insurance. They require and deserve equitable tax treatment in order to fulfill their mortgage responsibilities. Furthermore, placing this additional tax burden on the residents of a conversion project is contrary to the City's publicly stated policy of encouraging the conversion of buildings to residential uses.

We attach for your reference a copy of the City Treasurer's report on the Eglinton property and a letter to the Finance Department by our solicitor, which gives additional background information regarding our situation.

Thank you and your colleagues for consideration of this matter.

(Communication dated December 11, 1998, addressed to

Mr. R. Ripley, Finance Department from

Mr. P. Sandford, McCarthy Tétrault.)

We are the solicitors for the developers of a condominium conversion project known as Kensington Market Lofts which Is located at 3 Nassau Street. The project is currently under construction. Due to extraordinary circumstances which we believe may be unique, we are making application on behalf of our client to Council for the removal of the property from phase-in created by By-law No. 472-1998 which was enacted by Council pursuant to the powers conferred on it by Bill 16. You will see from the information which follows that the phase-in provisions produce a 1998 tax which is a breathtaking seven-fold increase in what would otherwise be the tax in 1998. As you will appreciate, that unexpected increase imposes a significant and entirely unanticipated burden on the present and future owners of the project.

Our client took title to the property in April, 1997. Previously, the property had been owned by George Brown College. By the time our client acquired the property it had been vacant for a number of years. Shortly thereafter, our client received a Notice of Assessment. Representatives of our client were shocked to learn that the assessed value of the property, which then reflected 1940 market values, was $1,051,000.00 whereas the 1997 purchase price had been $1,500,000.00. The assessment reflected the historic assessment returned against the College which of course had never been tested because the property was exempt and no payments were made in lieu of taxes. We think the history which follows receipt of the Notice of Assessment is important. We will review that his history in some detail.

Our firm was retained to pursue an appeal with respect to the 1997 assessment. Extensive discussions were conducted with representatives of the Regional Assessment Commissioner and a settlement was reached in the spring of 1998. That settlement comprehensively dealt with both the 1997 assessment and the assessed value and classification of the property for 1998. Quite frankly, we compromised significantly in connection with the 1997 value because we thought the proposed 1998 value and classification were reasonable. During the discussions we specifically made inquiries with representatives of the Regional Assessment Commissioner with respect to the possible effect of phase-in By-laws. (At that time, the Minister had announced that legislation would be introduced but Bill 16 was not in fact introduced in the House until May 7, the day our settlement was implemented before the Assessment Review Board.) The provincial assessors quite properly advised our representatives that no guarantees could be given with respect to phase-ins given the fact that the legislation had not been introduced when the negotiations were being concluded and given the additional important fact that City Council had not considered the matter. Nevertheless, we were advised that it was the "expectation" of staff that a reclassified property in the unusual circumstances experienced by 3 Nassau Street would not be subject to a phase-in. We therefore advised our client to significantly compromise its 1997 position on the reasonable expectation that 1998 and future taxes would be determined based on the 1998 assessed value.

You will appreciate our client's consternation when we were advised by City staff that the phase-in By-law will have a significant impact on 3 Nassau Street. Staff advise us that, with out the phase-in, the 1998 taxes would have been $46,710.00 whereas the amount to be billed, once the City computer makes an appropriate adjustment for the agreed-to 1997 assessment reduction, will be $313,210.00 - an increase of 670 percent.

We are advised that the additional tax liability will have significant implications for the people who have purchased units. In 1998, for example, the additional taxes per unit will be substantially more than expected as a result of the application of the phase-in, effectively penalizing the future owners of the residential property because it was a conversion. (This is contrary to City's publicly stated policy of encouraging the conversion of building to residential uses.) We appreciate that the effects of the phase-in are progressively reduced over 5 years but cumulative additional taxes per unit are quite significant.

We note that in the By-law Council specifically addressed the possibility of exempting properties from the phase-in. We understand that a property may be excluded from a phase-in "if there has been a change in use or character of any real property in the residential property class or in its classification under the Assessment Act that makes a phase- in or a continuation of the phase-in in respect of such property inappropriate". We believe that precisely describes the situation faced by our client and by the purchasers of units at 3 Nassau street. After the property was assessed for 1997, and before the 1998 assessment was returned, there was a change in both the use and character of the property at 3 Nassau Street. We ask that Council consider our request that the building be exempt from the phase-in and that the 1998 taxes be based on the 1998 assessed value.

The Strategic Policies and Priorities Committee submits the following communication (April 1, 1999) from the City Clerk:

Recommendation:

The Task Force submits this matter to the Strategic Policies and Priorities Committee without recommendation:

The Task Force reports, for the information of the Strategic Policies and Priorities Committee, having requested the Chief Financial Officer and Treasurer to:

(1) (a) review the situation with respect to 3 Nassau Street and, if the matter can be easily resolved, report to the Strategic Policies and Priorities Committee or directly to Council as necessary, in order that the matter can be dealt with by City Council at its meeting to be held on April 14, 1999; or

(b) if she has concerns with respect to 3 Nassau Street, to forward those concerns to the Task Force at its meeting to be held on May 3, 1999; and

(2) report to the meeting of the Task Force to be held on May 3, 1999 on the general issues respecting the phase-in by-law raised by the situations experienced by the owners of 188 Eglinton Avenue East and 3 Nassau Street, and outlining proposed solutions.

Background:

The Assessment and Tax Policy Task Force, on April 1, 1999, had before it a communication (March 18, 1999) from Mr. Alex Siegel requesting that 3 Nassau Street be exempted from the phase-in by-law.

The Task Force also had before it a communication (March 29, 1999) from Mr. James Julien, Kensington Market Working Group.

Mr. Peter Tomlinson, on behalf of the owner of 3 Nassau Street, appeared before the Assessment and Tax Policy Task Force in connection with the foregoing matter.

The Task Force's recommendations are noted above.

(The Strategic Policies and Priorities Committee reports, for the information of Council, that a copy of the attachments to the communication (April 1, 1999) from the City Clerk, Assessment and Tax Policy Task Force was forwarded to all Members of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee and copies thereof are also on file in the office of the City Clerk.)

(City Council on May 11 and 12, 1999, had before it, during consideration of the foregoing Clause, the following report (May 10, 1999) from the Chief Financial Officer and Treasurer:

Purpose:

To obtain authority for an amendment to By-law No. 966-1998 to exclude properties such as 3 Nassau Street which were not classified as residential/farm in 1997 but, as the result of a change in character or use of the property, were so classified in 1998, from the application of the City's phase-in program.

Financial Implications:

In the case of 3 Nassau Street, exclusion from the residential phase-in due to a change in classification between 1997 and 1998 by way of a Section 443 appeal, will result in an estimated $267,125 in tax deficiencies in 1998 and $200,342 in 1999. Funds are available in tax deficiencies to cover this amount.

Recommendations:

It is recommended that:

1. Authority be granted for the introduction of a bill in Council substantially in the form of the draft by-law attached hereto as Appendix "A", to amend By-law No. 966-1998.

Comments:

At its meeting of December 16 and 17, 1998, Council approved a policy of excluding from the phase-in of assessment-related tax increases and decreases all properties "where there has been a change in the classification of a property between the 1997 and 1998 tax years, and the property has been converted to residential uses for all of 1998" (SPP Report 26, Clause 17), and enacted By-law 966-1998 to give effect thereto.

Subsection 372(6) of the Municipal Act allows municipalities to pass a by-law excluding land from the application of the phase-in, if there has been a change in the use or character of the land or in its classification under the Assessment Act, that in the opinion of the council, makes a phase-in with respect to that land inappropriate.

At its meeting of May 3, 1999, the Assessment and Tax Policy Task Force considered a request to exclude the property at 3 Nassau Street from the City's phase-in provisions. The report from the Chief Financial Officer and Treasurer (dated April 22, 1999) recommended that the request to exclude 3 Nassau Street from the phase-in by-law not be granted.

Subsequent to my report dated April 22, 1999, new issues regarding the property at 3 Nassau Street were discovered that showed that the property was improperly classified for the 1997 taxation year and, that with the recommended amendment to By-law 966-1998, the property can correctly be excluded from the phase-in. The Task Force therefore recommended that the by-law be amended to include any change in class between 1997 and 1998, such that the property is reflected as residential/farm in 1998. At its meeting on May 4, 1999, the Strategic Policies and Priorities Committee adopted the recommendation of the Task Force.

The proposed amendment to the by-law was prompted by the circumstances regarding the property at 3 Nassau Street, as it highlighted the need for the by-law amendment. The Regional Assessment Commissioner has agreed to correctly reflect the classification of the property at 3 Nassau Street on the Frozen Assessment Listing as of December 31, 1997 as multi-residential. The 1997 assessment correction will be processed under Section 443 of the Municipal Act and dealt with administratively through the Corporate Services Committee. The assessment correction will result in the property changing classification from multi-residential in 1997 to residential/farm in 1998. However, the narrow wording of By-law No. 966-1998 does not provide for the exclusion of a property which changed classification other than by a request for reconsideration or appeal. It is therefore recommended that By-law No. 966-1998 be amended. With this change, the recommendation in my report of April 22, 1999 can be reversed as the property would meet the provisions of the amended by-law.

The number of properties which could qualify for the exclusion is very small in number. There are only two properties (188 Eglinton Avenue East and 3 Nassau Street) identified to date and it is not anticipated that there are many others that would be eligible for exclusion from the phase-in. The exclusion from the phase-in for 188 Eglinton Avenue East was addressed in my report dated December 4, 1998 (Clause 17, SPP Report No. 26).

Conclusion:

An amendment to By-law 966-1998 in the form recommended by this report will include properties changing classification to residential farm by means other than reconsideration and appeal, and will therefore eliminate the necessity to report to Council for each request. It is not anticipated that many other properties would meet the by-law provisions.

Contact Name:

Paul Wealleans, 397-4208

Lynne Ashton, 397-4203

Authority: Clause 9, Strategic Policies & Priorities Committee Report No. 9

Enacted by Council:

Bill No.

WHEREAS subsection 372(6) of the Municipal Act, as amended (the "Act") provides that if there has been a change in the use or character of any land or in its classification under the Assessment Act that, in the opinion of the council of the municipality, makes a phase-in or the continuation of a phase-in in respect of such land inappropriate, the council may in the by-law passed under subsection 372(1) of the Act or in another by-law exclude such land from the application of the phase-in; and

WHEREAS at its meeting of December 16 and 17, 1998, City Council adopted the recommendations of the Chief Financial Officer and Treasurer that, where there has been a change in the classification of a property between the 1997 and 1998 tax years, and the property has been converted to residential uses for all of 1998, such property should be excluded from the phase-in of assessment-related tax increases and decreases under By-law No. 472-1998; and

WHEREAS By-law No. 966-1998 limits such exclusion to properties which changed classification between the 1997 and 1998 tax years as a result of requests for reconsideration or assessment appeals; and

The Council of the City of Toronto HEREBY ENACTS as follows:

1. Section 1 of By-law No. 966-1998 is deleted and the following substituted:

"1. A property shall be excluded from the application of By-law No. 472-1998 if there has been a change in use or character of the property between 1997 and 1998, and (1) and (2) are met:

(1) the property was classified for the 1997 taxation year as belonging to a property class other than the residential/farm property class according to the assessment roll for 1997 as most recently revised and;

(2) (a) the property was classified as belonging to the residential/farm property class for the 1998 taxation year; or

(b) the property was incorrectly classified for the 1998 taxation year, as belonging to a property class other than the residential/farm property class and, as a result of a request for reconsideration pursuant to section 39.1 of the Assessment Act, or as a result of a complaint pursuant to subsection 40(1) of the Assessment Act, the property was reclassified as belonging to the residential/farm property class for the 1998 taxation year."

ENACTED AND PASSED this day of, A.D..

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Budget Committee embodied in the following communication (April 30, 1999) from the City Clerk:

Recommendation:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council, that the Toronto Zoo 'Stabilization Reserve' be designated as 'Stabilization Reserve Fund', as expressly provided for in Metropolitan Toronto By-law No. 78-96.

Background:

The Budget Committee had before it a communication (April 23, 1999) from the City Clerk advising that City Council, at its meeting held on April 13, 14 and 15, 1999, referred the Motion, moved by Councillor Cho, seconded by Councillor Lindsay Luby, to the Budget Committee, recommending that the Toronto Zoo "Stabilization Reserve" be designated as "Stabilization Reserve Fund", as expressly provided for in Metropolitan Toronto By-law No. 78-96.

City Council, at its meeting held on April 13, 14 and 15, 1999, referred the following Motion to the Budget Committee:

Moved by: Councillor Cho

Seconded by: Councillor Lindsay Luby

"Whereas the Municipality of Metropolitan Toronto By-law No. 78-96, entitled 'To Establish a Reserve Fund for Fiscal Stabilization for the Metropolitan Toronto Zoo', enacted and passed on June 19, 1996, provided for funds on deposit to earn investment interest; and

Whereas City Council, on April 29 and 30, 1998, by its adoption of Clause No. 12 of Report No. 6 of The Strategic Policies and Priorities Committee, headed 'Establishment of City Reserves and Reserve Funds', designated the reserve fund as a 'reserve' and reserves do not earn interest; and

Whereas the Board of Management of the Toronto Zoo was not aware of this change and included the interest on the reserve fund in the other revenue estimates to support the Ride and Revenue Development Program of the Board's 1999-2003 Capital Works Program, which has been approved by Council;

Now Therefore Be It Resolved That, in accordance with Section 46 of the Council Procedural By-law, Clause No. 12 of Report No. 6 of The Strategic Policies and Priorities Committee, head 'Establishment of City Reserves and Reserve Funds', which was adopted by City Council at its meeting held on April 29 and 30, 1998, be re-opened, insofar as it pertains to the reserve fund of the Board of Management of the Toronto Zoo, only;

And Be It Further Resolved That the Toronto Zoo 'Stabilization Reserve' be designated as 'Stabilization Reserve Fund', as expressly provided for in Metropolitan Toronto By-law No. 78-96."

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the Recommendation of the Budget Committee embodied in the following communication (April 30, 1999) from the City Clerk:

Recommendation:

The Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (April 22, 1999) from the Chief Financial Officer and Treasurer, wherein it is recommended that funding for this project (Streetcar Island Platform at St. Clair Avenue and Via Italia, included in Project No. 330 Yards and Roads - Various of the TTC capital program) be financed through the issuance of debentures for a term not exceeding twenty years, noting that the amount is within the City's updated debt and financial obligation limit, and direct the City Solicitor to apply to the OMB for approval as required under the City of Toronto Act.

Background:

The Budget Committee had before it a report (April 22, 1999) from the Chief Financial Officer and Treasurer recommending that funding for this project (Streetcar Island Platform at St. Clair Avenue and Via Italia, included in Project No. 330 Yards and Roads - Various of the TTC capital program) be financed through the issuance of debentures for a term not exceeding twenty years, noting that the amount is within the City's updated debt and financial obligation limit, and direct the City Solicitor to apply to the OMB for approval as required under the City of Toronto Act.

Purpose:

To respond to the request on the source of funding for the project.

Financial Implications:

Approval of the recommendation will increase the net capital requirements to be financed from debentures by $60,000.00 in 1999.

Recommendation:

It is recommended that funding for this project (Streetcar Island Platform at St. Clair Avenue and Via Italia, included in Project No. 330 Yards and Roads - Various of the TTC capital program) be financed through the issuance of debentures for a term not exceeding twenty years, noting that the amount is within the City's updated debt and financial obligation limit, and direct the City Solicitor to apply to the OMB for approval as required under the City of Toronto Act.

Background:

The Budget Committee, on February 19, 1999, approved the installation of a TTC island at St. Clair Avenue West and Via Italia, subject to the General Manager of the TTC reporting, directly to Council, on the need and cost of such shelter.

The Chief General Manager, TTC, in a letter to the City Clerk dated March 1, 1999, indicated that the TTC could not support the installation of the platform, on the basis that TTC customers are already well served by other nearby stops

City Council, on March 2, 3 and 4, 1999, adopted the recommendation that the installation of a TTC island at St. Clair Avenue and Via Italia be approved, and the Chief Financial Officer and Treasurer be requested to submit a report to the Budget Committee identifying an appropriate funding source for this $60,000.00 expenditure.

Discussion:

Funding for the TTC capital expenditure, excluding the Sheppard Subway, is primarily based on four sources:

(i) the TTC Capital Subsidy Reserve Fund (based on the amount prepaid by the Province in 1999 of all future TTC capital subsidies under the Capital Subsidy Agreement);

(ii) depreciation expenses included in TTC's operating budget related to the depreciation of capital assets funded by the Commission;

(iii) capital from current; and

(iv) debenture financing.

The 1998 year-end balance of the TTC Capital Subsidy Reserve Fund is anticipated to be depleted in 1999, as per the approved 1999 capital program. The available funding for 1999 through the TTC depreciation funding and capital from current has been also fully allocated in the 1999 approved capital program.

It is, therefore, recommended that the building of the streetcar island platform at St. Clair Avenue and Via Italia, as approved by City Council on March 2, 3 and 4, 1999, be financed through the issuance of debentures. The required amount ($60,000.00) is within the City's updated debt and financial obligation limit.

Conclusion:

Funding for the Streetcar Island Platform at St. Clair Avenue and Via Italia, included in Project No. 330 Yards and Roads - Various of the TTC capital program, as approved by City Council on March 2, 3 and 4, 1999, be financed through the issuance of debentures

Contact Name:

Andres Hachard (416) 392-5377.

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends:

(1) the adoption of the report (April 26, 1999) from the Chief Administrative Officer;

(2) that all the Quick Starts, except for the seven listed in the body of the aforementioned report, be forwarded to the appropriate committee as soon as possible;

(3) the seven Quick Starts first be reviewed by the Toronto Inter-Departmental Environment Team (TIE) as outlined in the aforementioned report and be forwarded to the appropriate committee by September 1999, for report or progress update; and

(4) that a copy of each of the reports be forwarded to the Environmental Task Force (ETF) for information:

Purpose:

This report outlines the process for the internal review of the Environmental Task Force (ETF) - Quick Start Actions and provides an update on the status of individual items.

Financial Implications:

There are no immediate financial implications to this report. Subsequent reports produced in response to individual quick start recommendations will provide details of the financial implications of implementation.

Recommendation:

It is recommended that the process outlined in this report be endorsed.

Council Reference:

At its meeting of December 16-17, 1998, City Council referred the report entitled "Sustainable Energy, Greenspace/Nature and Water Actions" from the Chair, Environmental Task Force to the Toronto Inter-Departmental Environment (TIE) Team and "requested the Chief Administrative Officer to report to its February 1999 meeting on the feasibility, timing and costs/benefits of the recommendations on standards" recommended in the report. As part of that report, the Chief Administrative Officer and the Commissioner of Works and Emergency Services, as the co-chairs of TIE were also asked to coordinate the preparation of the reports requested and provide monthly status reports to ETF on the progress of the recommendations.

At its meeting of January 26, 1999, the Strategic Policies and Priorities Committee (SPPC) referred the report entitled "Toxics, Pollution Prevention, Land and Air Climate Change Actions", dated January 12 from the Chair of ETF, to the Chief Administrative Officer (CAO) for a coordinated response to the recommendations.

At its meeting of February 23, 1999, the Strategic Policies and Priorities Committee referred the report entitled "Toronto Food Policy Council - Food and Agricultural Quick Starts", dated February 1, 1999, from the Chair of ETF, to the CAO for a coordinated response to the recommendations.

Background History:

As part of its mandate, the Environmental Task Force was requested "to identify and launch a series of urgent environmental initiatives to address pressing concerns such as smog, energy and water conservation, waste reduction as well as others". The ETF responded to this mandate by developing a list of "quick start actions" which could be undertaken by the corporation to address pressing environmental concerns of the Task Force and community members, and to ensure that the 'best' environmental practices of former municipalities were considered for expansion in the new City.

In September and October 1998, ETF held a series of workshops to develop these quick start actions in the following categories:

(i) air/climate change;

(ii) sustainable energy;

(iii) water;

(iv) land;

(v) greenspace/nature;

(vi) toxics/pollution prevention; and

(vii) food.

The workshops brought together various stakeholders from the environmental groups, business, the academic and scientific communities, City Council, and staff to develop recommendations for Task Force consideration. The ETF considered the recommendations of each of the workshops and developed three succinct lists of recommendations for consideration by SPPC. These reports have been considered by City Council and TIE has been asked to coordinate the responses to the recommendations, report on their feasibility, and provide a monthly status report on their progress to ETF.

Comments:

The quick start recommendations were developed to address concerns from the community and Task Force members that the task force process was too long to wait for the City to act on some important environmental issues. They also felt that there were actions which the corporation could take in the short term, without too much additional human or financial cost to the corporation.

A review of the recommendations suggests that of the 34 quick starts proposed, 7 would benefit from a corporate overview by the Toronto Inter-departmental Environment (TIE) Team in order to ensure that there is appropriate coordination among departments, that the appropriate lead is designated, and/or that the long term costs, benefits and corporate impacts are assessed. The 7 quick starts which will be reviewed by TIE include:

(1) incorporate higher energy efficiency and conservation objectives into the construction of new buildings in the City than are currently required by the Ontario Building Code;

(2) a comprehensive long term strategy to minimize operating and capital energy expenditures and achieve the highest feasible levels of CO₂ emission reduction in facilities owned by the City;

(3) appropriate funding strategies for combined sewer overflow and stormwater management initiatives;

(4) Council endorse the practice of increasing the purchase of Canadian organic food by the City; and that Council direct the appropriate City officials responsible for food service contracts to ensure that the purchase of Canadian organic food increases over the term of food service contracts between the City and food service providers;

(5) the Human Resources Director investigate the program run by Husky Molding Company, which provides organic food to employees at discounted prices, which has resulted in a reduction of absenteeism and lower medical and drug costs;

(6) the Chief Administrative Officer and the Commissioner of Corporate Services report on how the City could achieve reductions in emissions from mobile and stationary diesel sources owned by the City and its Agencies, Boards and Commissions which are not included in the Provincial 'Drive Clean' Program; and

(7) the Chief Administrative Officer and the Commissioner of Works and Emergency Services, as co-chairs of the Toronto Inter-departmental Environment (TIE) Team, be requested to report on how reports to City Council could include carbon dioxide accounting information.

TIE will coordinate a corporate review of these reports, bringing the discussions forward to Senior Management, where necessary. The final reports will be brought forward by the appropriate commissioner to the appropriate committee. In cases where no commissioner is designated, TIE will assign an appropriate lead department.

Status of the Quick Starts:

The Commissioner of Works and Emergency Services, as the co-chair of TIE, is preparing bi-monthly status reports on the progress of the quick start actions for ETF. The first report was forwarded to the January 28 meeting of ETF and the second report to the April 27 ETF meeting. See Appendix for the table of details regarding the status of individual items.

The table indicates that of the 34 quick starts, 4 items or reports have already gone forward to Council, 4 have been incorporated into processes underway, and 3 reports are prepared and have been forwarded to the appropriate committee for consideration at the next meeting.

Conclusion:

The quick starts were intended either to assist in advancing environmentally beneficial initiatives already underway, or to bring forward new initiatives which, with a relatively small investment, could bring about long term environmental benefits. In some cases, a further evaluation of the recommendations has revealed that TIE could assist in co-ordinating responses which require inter-departmental collaboration, analyzing the corporate implications of the recommendations, and in some cases in bringing forward the recommendation more quickly. The other quick starts (not listed above) should go forward to the appropriate committee as soon as possible.

Contact:

Lisa Salsberg, (Acting) Manager, Healthy City Office; 392-1086.

The Strategic Policies and Priorities Committee submits the following communication (May 4, 1999) from Councillor Jack Layton, Chair, Environmental Task Force:

It is recommended that the Recommendation embodied in the following report (April 26, 1999) from the Chief Administrative Officer be amended by adding the following subsections:

(1) that all the quick starts, except for the seven listed in the body of the report, go forward to the appropriate committee as soon as possible;

(2) that the seven quick starts first be reviewed by the Toronto Inter-Departmental Environment Team (TIE) as outlined in the report go to the appropriate committee by September 1999, for report or progress update; and

(2) that a copy of each of the reports be forwarded to the Environmental Task Force (ETF) for information.

Rationale:

Subsection A makes explicit the intention of the report, as outlined in the final sentence of the conclusion. Subsection B asks that reports (or, where necessary, progress updates) on the seven outstanding Quick Starts be made to the appropriate committee within five months. These amendments have received approval from the Chief Administrative Officer.

(City Council on May 11 and 12, 1999, adopted the following recommendations:

"It is recommended that:

(1) the report dated May 6, 1999, from the City Solicitor, entitled 'One Clarendon Avenue - Application to Terminate Tenancy Agreements, Ontario Rental Housing Tribunal Hearing', be received;

(2) the joint report dated May 10, 1999, from the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighbourhood Services, entitled 'One Clarendon Avenue - Application to Terminate Tenancy Agreements to Demolish Rental Units', embodying the following recommendations, be adopted:

'It is recommended that Council:

(a) request that the Minister of Municipal Affairs and Housing amend the Tenant Protection Act, 1997, or take other appropriate action, to clearly define what tests must be met before demolition can be claimed as grounds for termination of tenancies;

(b) because this matter may have implications for other municipalities in Ontario, advise the Association of Municipalities of Ontario of this matter and request their support in requesting amendments to the Tenant Protection Act; and

(c) the appropriate City officials be authorized to undertake any necessary action to give effect to the above recommendations.';

(3) the City Solicitor be instructed to serve a Notice of Appeal to the Divisional Court, within the 30-day appeal period, to appeal the decision of the Ontario Rental Housing Tribunal on its refusal to grant the City standing in this matter, in order to preserve all of the City's rights to participate in an appeal at the Divisional Court if an appeal is brought by either the landlord or the tenants involved;

(4) the City Solicitor also be instructed, if an appeal of the Tribunal decision is brought, to take every reasonable measure to ensure that the City's interests with respect to protecting the supply and affordability of rental housing are protected and advanced at the appeal by seeking status at the appeal and by taking such other actions as he deems appropriate; and

(5) the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighbourhood Services be directed to provide every reasonable assistance and support to the tenants involved if the decision of the Tribunal is appealed.")

The Strategic Policies and Priorities Committee reports having:

(1) instructed the City Solicitor to attend the hearing before the Ontario Rental Housing Tribunal on May 5, 1999, to seek an adjournment of this matter so as to allow sufficient time to secure instructions from City Council to attend at the hearing and participate in the hearing of this matter; and recommends that City Council concur in the action taken; and

(2) requested the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighbourhood Services (Housing Division) to submit a report directly to Council for its meeting scheduled to be held on May 11, 1999, on the issues before the Tribunal on May 5, 1999, and their recommendations in regard thereto.

The Strategic Policies and Priorities Committee submits the following joint communication (May 3, 1999) from Councillor Joe Pantalone, Chair, Urban Environment and Development Committee and Councillor Chris Korwin-Kuczynski, Chair, Community and Neighbourhood Services Committee:

Please be advised that we support the introduction of the attached report from the Council Sub-committee to Restore Rent Control, dated April 30, 1999, onto the agenda of your meeting on May 4, 1999, due to the urgency of this matter.

The City Solicitor has advised Ms. Barbara Leonhardt, Director, City Planning, Policy and Research, Urban Planning and Development, that if your committee adopts the Sub-committee's report that he will attend the Rental Housing Tribunal Hearing on May 5, 1999, regarding this matter to seek an adjournment of the scheduled hearing in order to have sufficient time to secure instructions from City Council to participate in the hearing.

We are writing to you as the chairs of the Community and Neighbourhood Services Committee, and Urban Environment and Development Services Committee. This matter was to have been before our special joint meeting on May 3, 1999, but the meeting was cancelled due to the lack of quorum.

The Strategic Policies and Priorities Committee also submits the following report (April 30, 1999) from Councillor Michael Walker, Chair, Sub-Committee to Restore Rent Control, addressed to the Community and Neighbourhood Services Committee and the Urban Environment and Development Committee:

Purpose:

To recognize the Ontario Rental Tribunal Hearing, on May 5, 1999, regarding 1 Clarendon Avenue, as being of interest to the City of Toronto.

Funding Sources and Financial Implications:

There are no financial implications arising from this report.

Recommendations:

It is recommended that:

(1) City Council recognize that the applications of 1 Clarendon Inc., to terminate various tenancy agreements in respect of 1 Clarendon Avenue is a matter of critical importance within the municipality, insofar as if the Ontario Rental Housing Tribunal fails to embrace a restrictive definition of "demolition" and a correspondingly expansive definition of "repair or renovation" for the purposes of the Tenant Protection Act, the security of tenure and other rights of residential tenants across the City of Toronto will be in extreme jeopardy in view of the financial incentive for residential landlords to evict residential tenants and rely upon the "vacancy decontrol" provisions of the Tenant Protection Act to substantially increase rents;

(2) the City Solicitor be instructed to attend at the hearing before the Ontario Rental Housing Tribunal on May 5, 1999, and seek an adjournment of this matter so as to allow sufficient time to secure instructions from City Council to attend at the hearing of this matter and participate in the hearing of this matter in order to defend the interest of the City of Toronto, as this is a matter of grave concern within the municipality; and

(3) the City Solicitor be instructed to intervene in any appeal or other hearings which flows from these proceedings in order to defend the interest of the City of Toronto.

The Sub-Committee advises that it has also requested the Commissioner of Community and Social Services and the Commissioner of Urban Planning and Development Services to report back to the Sub-Committee, and directly to Council if necessary, on the issues with respect to the definitions of "demolition" and "renovation" under the Tenant Protection Act so as to deal with the interpretation of a repair and renovation as being a demolition.

Background:

At its meeting held on April 30, 1999, the Council Sub-Committee to Restore Rent Control had before it a communication (April 30, 1999) from Councillor John Adams, regarding an application to demolish rental units at 1 Clarendon Avenue.

Mr. Joseph Debono, Solicitor for four tenants of 1 Clarendon Avenue addressed the Sub-Committee.

The Strategic Policies and Priorities Committee reports, for the information of Council, having also had before it the following communications which were forwarded to all Members of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee, and copies thereof are also on file in the office of the City Clerk:

- (April 30, 1999) from Councillor John Adams, addressed to Councillor Michael Walker Chair, Restore Rent Control Sub-committee; and

- (April 29, 1999) from Mr. Joseph DeBono of Fraser Milner, Barristers and Solicitors, solicitors for Mr. Norman Ross, Mr. David Overholt, Ms. Janice Rae and Ms. Pia Nummi.

(City Council on May 11 and 12, 1999, had before it, during consideration of the foregoing Clause, the following report (May 6, 1999) from the City Solicitor:

Purpose:

To inform the Council of the outcome of the City's attempt to secure an adjournment of the above-noted hearing in order to grant City Council the opportunity to seek party status before the Ontario Rental Housing Tribunal ("the Tribunal").

Financial Implications:

There are no financial implications associated with this report.

Recommendation:

It is recommended that Council receive this report for information.

Background:

An application was filed by the landlord of One Clarendon Avenue to terminate tenancies pertaining to 8 apartments on the basis that the units are to be "demolished". Four of the affected tenants engaged the services of Fraser Milner to represent them in opposition to the application at the May 5, 1999 hearing before the Tribunal.

At its meeting held on May 3, 1999, the Strategic Policies and Priorities Committee (SPCC) had before it the April 30, 1999, Report of the Sub-Committee to Restore Rent Control pertaining to this matter. In adopting that Report SPPC:

(1) instructed the City Solicitor to attend the hearing before the Ontario Rental Housing Tribunal on May 5, 1999, to seek an adjournment of this matter so as to allow sufficient time to secure instructions from City Council to attend at the hearing and participate in the hearing of this matter; and

(2) requested the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighborhood Services (Housing Division) to submit a report directly to Council for its meeting scheduled to be held on May 11, 1999, on the issues before the Tribunal on May 5, 1999, and their recommendations in regard thereto.

Comments:

At the May 5, 1999 hearing the Tribunal, as a preliminary matter, heard the request of the City Solicitor that the Tribunal adjourn the hearing to allow Council the opportunity to determine whether the City would be seeking party status.

In support of this request the City Solicitor argued that Tenant Protection Act ("the Act") granted the Tribunal the discretion to add the city on as a party. Specifically, section 174(1) of the Act provides that "the parties to an application are the landlord and any tenants or any other persons directly affected by the application", Section 174(2) states that the tribunal may "add or remove parties as the tribunal considers appropriate".

To demonstrate the City's direct interest in this matter, the Tribunal was advised that the City had been a party before the Ontario Municipal Board under the Rental Housing Protection Act. The Tribunal was also provided with a number of reports dealing with the City's concerns over, and interest in, the preservation of rental housing stock.

After deliberating on the matter, the Tribunal Chair, Mr. Wronecki, ruled:

(1) that the city's request for standing was unusual and unprecedented, despite the existence of similar provisions in the previous Landlord-Tenant legislation;

(2) that section 174 of the Act had to be read in a restrictive manner to preclude joining anyone who would like to speak to the Tribunal;

(3) that there was no precedent for granting the City intervenor status;

(4) that the parties with a "direct" interest could still present City policies as evidence; and

(5) that, "it would mix the roles of the quasi-judicial process and the political process if [he was] to accept the City of Toronto has standing in this matter".

In denying the City's request, the Chair concluded his comments by saying "this application is about four tenants".

Conclusions:

At the May 5, 1999, hearing into the application by the landlord of 1 Clarendon Avenue to terminate 8 tenancies on the basis that the apartments affected were to be "demolished", the Tribunal rejected the City's request that the matter be adjourned, holding that the City could not be granted standing before the Tribunal as there was no direct interest on the part of the City and no basis to grant the City any intervenor status.

Contact Name:

Marc Kemerer

Telephone: (416) 392-1228

Fax: (416) 392-0024

E-mail: mkemerer@toronto.ca)

(City Council also had before it, during consideration of the foregoing Clause, the following joint report (May 10, 1999) from the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighbourhood Services:

Purpose:

To respond to the Strategic Policies and Priorities Committee's directives and inform Council of the potential impact of an application to terminate tenancy agreements at One Clarendon Avenue.

Financial Implications:

None.

Recommendation:

It is recommended that Council:

• Request that the Minister of Municipal Affairs and Housing amend the Tenant Protection Act, 1997, or take other appropriate action, to clearly define what tests must be met before demolition can be claimed as grounds for termination of tenancies;
• Because this matter may have implications for other municipalities in Ontario, advise the Association of Municipalities of Ontario of this matter and request their support in requesting amendments to the Tenant Protection Act; and

3. The appropriate City officials be authorized to undertake any necessary action to give effect to the above recommendation.

Background:

Applications have been filed by the landlord of One Clarendon Avenue to terminate the tenancies of tenants of nine units. The reason given for requiring termination is that the units are to be demolished. The tenants have not vacated their units.

Four tenants engaged the services of Fraser Milner, Barristers & Solicitors, to represent them at the Ontario Rental Housing Tribunal to argue that the proposed work is "renovation", not "demolition." The key difference between the two grounds is that if a tenant vacates a unit because of renovation work, they have the right to return to the unit when the work is completed (called "right of first refusal") at the same rent that would have been charged had they not vacated the unit. With demolitions, however, the tenants do not have right of first refusal. When the work is completed, the landlord can opt to charge a higher rent because of vacancy de-control provisions under the Tenant Protection Act.

The tenants' solicitor, Joseph Debono has written letters on this issue to the City Legal Department and Councillor Adams and made a deputation to the Council Sub-committee to Restore Rent Control.

Councillor Adams, in a letter dated April 30, 1999, to Councillor Walker, Chair of the Restore Rent Control Sub-Committee indicated that he would be moving the recommendations included in Mr. Debono's letter. On Friday, April 30, 1999, the Sub-committee to Restore Rent Control had before it a request by Councillor Adams to:

1. Recognize the applications of One Clarendon Inc. to terminate various tenancy agreements to be a matter of interest to the municipality;

2. Instruct the City Solicitor to attend at the hearing before the Ontario Rental Housing Tribunal on May 5, 1999, and seek an adjournment of the matter to allow sufficient time to secure instructions from Council; and

3. Instruct the City Solicitor to intervene in any appeal or other hearing which flows from the proceedings in order to defend the interests of the City.

The Sub-committee adopted the recommendations of Councillor Adams, and forwarded the recommendation to the Special Joint Meeting of Community and Neighbourhood Services Committee and Urban Environment and Development Committee scheduled for May 3, 1999. The report of the Sub-committee was not dealt with by the Special Joint Meeting of the Committees since no quorum was achieved and no formal meeting held.

A communication dated May 4, 1999 from Councillor Pantalone, Chair Urban Environment and Development Committee and Councillor Chris Korwin-Kuczynski advised the Strategic Policies and Priorities Committee (SPPC) that they supported the introduction of the report from the Council Sub-committee to Restore Rent Control due to the urgency of the matter. At its meeting on May 3, 1999, the Strategic Policies and Priorities Committee considered a report on 1 Clarendon Avenue - Application to Demolish Rental Units, Potential City-wide Rent Control Loophole (Clause No. 13 of Report No. 9) and:

(1) instructed the City Solicitor to attend the hearing before the Ontario Rental Housing Tribunal on May 5, 1999, to seek an adjournment of this matter so as to allow sufficient time to secure instructions from City Council to attend at the hearing and participate in the hearing of this matter; and recommends that City Council concur in the action taken; and

(2) requested the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighbourhood Services to submit a report directly to Council for its meeting scheduled to be held on May 11, 1999, on the issues before the Tribunal on May 5, 1999, and their recommendations in regard thereto.

Comments:

(1) The Ontario Rental Housing Tribunal Hearing

At the May 5, 1999 hearing, the Tribunal rejected the City's request for a delay and ordered the case to proceed. The City was also refused standing in the case which would have entitled the City to present evidence and witnesses. It is anticipated that the decision will be made in early June. The City Solicitor will be reporting separately on the Tribunal's decision.

(2) Issues Before the Tribunal

The landlord has issued notices to terminate tenancies for the purposes of demolition. The nature of the work is interior renovation and reconfiguration of the units in the building that will not change the number of units. The issue is whether the proposed work constitutes demolition or renovation.

The Chief Building Official and Chief Planner are of the opinion that the work is renovation and not demolition. The applicant did not apply for a demolition permit pursuant to the Planning Act or the Building Code Act and the City has not issued a demolition permit pursuant to either of those Acts. The applicant was issued a permit (No. 416149) on December 7, 1998 for interior alterations to the existing building. Buildings staff were subpoenaed by the tenants' solicitor in support of their argument.

The Tenant Protection Act makes specific provisions for tenants whose tenancies are terminated because their unit is being demolished, and also for tenants who must vacate their unit because of renovation/repair work that so extensive a building permit and vacant possession of the rental unit is required. The differences turn on the matter of the rights of the tenants to re-occupy the renovated unit

In the case of repairs or renovation, the tenant has a "right of first refusal" to occupy the unit when the renovations or repairs are completed at the same rent that would have been charged had the tenancy not been interrupted; this right does not apply in the case of demolition. A tenant who exercises this right in the case of renovation and repair is entitled to re-occupy the unit at a rent that is no more than what the landlord could have lawfully charged if there had been no interruption in the tenancy (i.e. the unit is not considered vacant and therefore the rent is not de-controlled). Where the renovation results in a reconfiguration of one or more units (i.e. a change in the amount of floor space), the rent may be increased or reduced proportionate to the change in floor space.

On April 13, 14 and 15, 1999, City Council adopted Official Plan Amendment No. 2 (copy attached) regarding the conversion of rental housing to condominium and demolition of rental. In adopting Official Plan Amendment No. 2 , it is the policy of Council to:

- preserve, maintain and replenish the supply of residential buildings, and particularly rental buildings, across the City of Toronto by restricting the demolition of residential property and the conversion of rental units to condominium;

- consider allowing conversions where the rents charged for each and every unit are at or above the average "high-end" rent level and 66 per cent of the tenants favour the conversion;

- seek retention of all rented residential units except where a building, which in the opinion of the Chief Building Officer, is structurally unsound; and

- seek replacement of demolished rental units with rental units of a similar number, size, type and level of affordability.

In short, the policies seek to preserve the supply of affordable rental stock, restrict conversions and demolitions and have demolished units replaced.

The disposition of this matter by the Tribunal is of interest to the municipality, and could have serious implications for tenants (security of tenure and rent increases) and the City's supply of affordable rental housing if the Tribunal finds that the renovation and repairs constitute "demolition" under the Tenant Protection Act. With such a precedent, landlords could use this approach to create a "fast track" to substantially increase rents (by creating luxury units) and consequently position these units for conversion to condominium by meeting the "high-end" rent criterion in the City's new policies. If the landlord's proposal was considered to be a genuine demolition, the City would be seeking replacement units of a similar number, size, type and level of affordability.

Even if the Tribunal rules in favour of the tenants, the issue of renovation versus demolition will reoccur. The negative impacts that would result from a ruling that favours the landlord warrant Council to pursue action that will protect tenants and preserve the supply of affordable rental housing. The problem could be resolved by including a definition of "demolish" in the Tenant Protection Act. The Planning Act and Tenant Protection Act do not include definitions of "demolish" or "demolition". The Tenant Protection Act states that in the event of a conflict between it and the Building Code Act, 1992, the Tenant Protection Act prevails. The Building Code Act, 1992 defines "demolish" to mean "to do anything in the removal of a building or any material part thereof".

The Building Code further provides that no person shall demolish a building or cause a building to be demolished unless a permit has been issued by the chief building official. In practice, the definition of "demolish" has not been interpreted to be the removal of an interior wall. "Demolish" is generally interpreted to mean the removal of exterior walls.

This report recommends that Council request that the Minister of Municipal Affairs and Housing amend the Tenant Protection Act, 1997, or take other appropriate action, to clearly define what tests must be met before demolition can be claimed as grounds for termination of tenancies.

As this issue is important to all municipalities, this report also recommends that Council should seek the support of the Province's other municipalities through the Association of Municipalities of Ontario, when it requests the Province to make changes to the Tenant Protection Act.

Contact Names:

Matt Rae Katherine Chislett

Planner Shelter Housing & Support Division

City Planning Division Tel: 392-0054

Tel: 392-8124

Authority: Urban Environment and Development Committee Report No. 3, Clause No. 3,as adopted by City of Toronto Council on March 2, 3 and 4, 1999; and Notice of Motion J(8) by Councillor Chong, seconded by Councillor Ootes,as amended and adopted by City of Toronto Council on April 13, 14 and 15, 1999

Enacted by Council: April 15, 1999

The Council of the City of Toronto HEREBY ENACTS as follows:

1. The official plan amendments set out in this by-law are hereby adopted.

2. The official plan of the former Municipality of Metropolitan Toronto is amended by adding the following new policies:

135.1 to preserve, maintain and replenish the supply of residential buildings, and particularly rental buildings, across the City of Toronto by restricting the demolition of residential property and the conversion of rental units to condominium, and/or freehold, by discouraging the conversion of rental units to equity co-operative, and by encouraging new rental housing production.

135.2 to restrict the conversion to condominium of any building, or any related group of buildings, including non-profit co-operative and/or equity co-operative, containing six or more rented residential units as it would be premature and not in the public interest, unless the vacancy rate in the City of Toronto, as reported by Canada Mortgage and Housing Corporation, for private rental apartments and townhouses, respectively, has been at or above 2.5 per cent for the preceding two year reporting period.

135.3 (a) despite policies 135.1, 135.2 and 135.4, to consider allowing the conversion of buildings containing six or more rented residential units only where:

(i) the rents that were actually charged for each unit in the building or related group of buildings one year prior to the application, were at or above the average high-end rent level by unit type as prescribed by Council from time to time, and based on Canada Mortgage and Housing Corporation reports; and

(ii) at least 66 per cent of the tenanted households have expressed their support in writing for the conversion application in a manner prescribed by Council; or

(b) despite policies 135.1, 135.2 and 135.4, to consider allowing the conversion of equity co-operative buildings containing six or more rented residential units where:

(i) the co-operative was legally created prior to June 17, 1998;

(ii) 50 per cent or less of the units are tenanted;

(iii) 66 per cent of each of the tenant and shareholder households have expressed their support in writing for the conversion application in a manner prescribed by Council; and

(iv) an application for condominium approval under the Planning Act has been made by the equity co-operative corporation within 2 years following approval of this policy.

135.4 to seek the retention of rented residential units, except where the whole or part of a building which contains such units is in the opinion of the Chief Building Official structurally unsound, and to consider, where appropriate, acquiring or leasing a property where such units are at risk of being demolished.

135.5 (a) when considering redevelopment applications involving the demolition of rented residential units, to seek the replacement of the demolished rental units with rental units of a similar number, type, size, and level of affordability in the new development, and/or alternative arrangements, which in the opinion or Council are consistent with the intent of this policy; and

(b) when considering such applications in the context of an increase in height and/or density, to secure such replacement units and/or alternative arrangements through an appropriate legal agreement under Section 37 of the Planning Act.

3. The official plan of the former Municipality of Metropolitan Toronto is amended by adding the following definitions under the Glossary of Terms:

related group of buildings

buildings that are under the same ownership and on the same parcel of land as defined in section 46 of the Planning Act, as may be amended from time to time.

rented residential units

means premises used for rented residential purposes, and includes premises that have been used for rented residential purposes and are vacant.

4. Upon the policies set out in section 2 of this by-law coming into force, the following official plan sections are deleted:

(a) sections 2.5.6, 4.5.3, 4.5.4, 4.5.5, 4.10 and 4.10.1 of the official plan for the former Borough of East York;

(b) sections 2.2.13, 2.2.15, 2.2.16, 11.15.2 and the words "or conversion of existing rental accommodation" in sections 11.15.3 and 11.15.4 in the official plan for the former City of Etobicoke;

(c) sections 2.6.2, 2.6.3 and 2.6.4 in Part C.4 of the official plan for the former City of North York;

(d) sections 6.18 and 6.19 of the official plan for the former City of Toronto; and

(e) sections 9.7(b), 9.8 and item 6 in Part (B) in Appendix I of the official plan for the former City of York.

5. The following are the official plan amendment ("OPA"), numbers for the official plan amendments adopted by this by-law: OPA number 2 for the official plan of the former Municipality of Metropolitan Toronto, OPA number 18 for the official plan of the former Borough of East York, OPA number 70-99 for the official plan of the former City of Etobicoke, OPA number 473 for the official plan of the former City of North York, OPA number 139 for the official plan of the former City of Toronto, and OPA number 153 for the official plan of the former City of York, respectively.

6. Any related technical amendments to the official plans referred to in sections 2 to 4 of this by-law shall be made.

ENACTED AND PASSED this 15th day of April, A.D. 1999.

CASE OOTES, NOVINA WONG,

Deputy Mayor City Clerk

(Corporate Seal))

(City Council also had before it, during consideration of the foregoing Clause, the following communication (May 12, 1999) from Councillor John Adams, Midtown:

Recommendations:

1. That City Council adopt the recommendation in City Solicitor's report dated May 6, 1999 (Communication 19(a) and the three recommendations in the joint report dated May 10, 1999 from Commissioners of Urban Planning and Development Services and of Community and Neighbourhood Services (Communication 19(b)).

2. That City Council instruct the City Solicitor to serve a Notice of Appeal to the Divisional Court within the 30-day appeal period to appeal the decision of the Ontario Rental Housing Tribunal on its refusal to grant the City standing in this matter in order to preserve all of the City's rights to participate in an appeal at the Divisional Court if an appeal is brought by either the landlord or the tenants involved.

3. That City Council also instruct the City Solicitor, if an appeal of the Tribunal decision is brought, to take every reasonable measure to ensure that the City's interests with respect to protecting the supply and affordability of rental housing are protected and advanced at the appeal by seeking status at the appeal and by taking such other actions as he deems appropriate.

4. That City Council direct the Commissioner of Urban Planning and Development Services and the Commissioner of Community and Neighbourhood Services to provide every reasonable assistance and support to the tenants involved if the decision of the Tribunal is appealed.

Background:

The owner of One Clarendon Avenue applied for termination of eight tenancies. The first notices to tenants said the purpose was for "renovations." A second notice said the purpose was for "demolition." The difference is that if the "demolition" application is successful, the tenants will no longer have the right to return to their respective units after the work is done and the empty units are de-controlled from rent control. The landlord told the Tribunal he was renting one-bedroom units for approximately $850 a month and anticipates being able to charge $1,500 a month on the open market.

This application raises important issues of interpretation concerning a landlord's ability to evict existing tenants on the basis that the landlord is doing work he describes as "demolition". The Commissioners' report that, "In practice, the definition of "demolish" has not been interpreted to be the removal of an interior wall. "Demolish" is generally interpreted to mean the removal of exterior walls." The landlord has not applied to remove exterior walls.

This application is a matter of concern to the City as a result of its impact as a precedent and the potential impact on the stock of rental housing in the City. Given these concerns, the City sought standing before the Tribunal hearing on May 5, 1999. The Tribunal refused to grant standing to the City. The Tenant Protection Act provides that any person affected by an Order of the Tribunal may appeal the Order to the Divisional Court of Ontario within 30 days on a question of law. The Tribunal started and completed its hearing on May 5, 1999 and reserved its decision after hearing from solicitors for the landlord and tenants.)

(City Council on May 11 and 12, 1999, adopted the recommendation embodied in the communication dated May 4, 1999, from Councillor Disero, Davenport, viz.:

"It is recommended that the City Solicitor be instructed to attend the Ontario Municipal Board hearing scheduled for May 31, 1999, in support of the Committee of Adjustment decision of February 9, 1999, and that the Commissioner of Urban Planning and Development Services be requested to assist.")

The Strategic Policies and Priorities Committee reports having requested the City Solicitor to submit a report directly to Council for its meeting scheduled to be held on May 11, 1999, respecting the Ontario Municipal Board Hearing regarding 1383 Lansdowne Avenue; such report to include costs and the source of funds.

The Strategic Policies and Priorities Committee submits the following communication (May 4, 1999) from Councillor Betty Disero, Davenport - Ward 21:

An application for the above-noted location was refused by the Committee of Adjustment on Tuesday, February 9, 1999. Please see the attached.

Recommendation:

It is recommended that the City Solicitor be instructed to attend the Ontario Municipal Board hearing scheduled for Monday, May 31, 1999, in support of the Committee of Adjustment decision of Tuesday, February 9, 1999, and that the Commissioner of Urban Development be requested to assist.

The Strategic Policies and Priorities Committee also submits the following communication (February 9, 1999) from Councillor Betty Disero, Davenport - Ward 21, addressed to Ms. Marilyn Stuart, Manager, Committee of Adjustment:

I am writing on behalf of local residents who are vehemently opposed to Mr. Tony Henriques' application, who is requesting variances to alter the above-noted premises to a converted house containing three dwelling units - including the use of the basement as a self-contained apartment. Please refer to the attached, which is self-explanatory.

The following concerns have been brought to my attention:

(1) Parking has been, and still is a major problem on Lansdowne Avenue and neighbouring streets. Permit holders have continually been inconvenienced by illegal parking, either by visitors or tenants of illegal dwelling units. For example, basement or attic apartments.

(2) The proposed self-contained apartment units are too small in size (519 sq. ft.). Lansdowne Avenue is characterized and known for having semi-detached and detached homes, owner occupied, and family oriented. The proposed units are too small to maintain the spirit and character of the neighbourhood.

(3) The proposed density is too high. Variance calls for 1.104 times the area of the lot. The majority of homes in the area are within 0.6 times the area of the lot.

(4) 1383 Lansdowne Avenue has been a problem for some time. It's been operating as a multiple dwelling unit. It's absentee landlord has disregarded by-laws and the rights of neighbours, by not keeping up his property. For instance, the landlord proceeded with housing renovations without the benefit of a building permit.

With reference to the four tests of Planning, I would like to note the following:

(1) it is in keeping with the general intent and purpose of the Official Plan?

Sections 1.8b; 6.2; 6.4 6.14; and 6.15 of the Official Plan refer to "appropriate form of intensification". The intent of these policies is to set out a strategic planning direction, which clearly establishes where and what type of intensification would occur within the hierarchy. "Lansdowne Avenue" is not in the central core where intensification is encouraged, is not a main street where intensification is encouraged to a lesser degree. Lansdowne Avenue is within a low residential neighbourhood, where the proposed over intensification will not be in keeping and compatible with the surrounding neighbourhood.

(2) Neighbourhood compatibility?

In this particular proposal, with the inclusion of the proposed basement apartment, the Building exceeds the 1.0 times allowed by the Official Plan, resulting in over intensification.

(3) Is it minor?

The proposed development will have significant adverse impacts on the neighbours in as much as:

(a) lack of front yard and back yard amenities;

(b) accumulation of garbage and its related unsanitary conditions;

(c) lack of landscape open space;

(d) lack of recreational facilities for its occupants;

(e) noise level;

(f) a transient population in a family oriented neighbourhood;

(g) parking and traffic implications;

(h) setting a precedent for future over intensification uses;

(i) will affect the quality of life to next door neighbourhoods and its occupants.

(4) Does it represent an appropriate Development of the Lands?

It will result in an over intensification of the site creating adverse impact and incompatibility problems.

For the above reasons, on behalf of my constituents, I ask your respected Committee to refuse this application.

However, in an effort to bring this property into compliance, I would like to suggest that as an alternative, it would be easier for the community to swallow a more appropriate form of development, for example:

Two self-contained units - one comprising of the first floor and the basement - connected by way of interior stairs, any basement separate entrance must be removed. The second unit comprising of the second floor and attic.

The result would be larger units, with higher rental income, family units and a greater degree of compatibility. In addition, you would have less parking problems, garbage accumulation etc.

Thank you for your consideration in this matter.

The Strategic Policies and Priorities Committee reports, for the information of Council, having also had before it a communication (February 3, 1999) from concerned residents, addressed to Ms. Anne Pyle, Applications Technician, which was distributed to Members of the Strategic Policies and Priorities Committee at its meeting on May 4, 1999, a copy of which is also on file in the office of the City Clerk.

(City Council on May 11 and 12, 1999, had before it, during consideration of the foregoing Clause, the following report (May 7, 1999) from the City Solicitor:

Purpose:

To report on the costs and source of funds required in respect of the appeal of the decision of the Committee of Adjustment to the Ontario Municipal Board.

Funding Sources, Financial Implications and Impact Statement:

None.

Recommendations:

That this report be received for information.

Council Reference/Background/History:

The Strategic Policies and Priorities Committee at its meeting May 5, 1999, adopted a report that instructs the City Solicitor to attend at the Ontario Municipal Board appeal, scheduled for May 31, 1999, and requests the City Solicitor to submit a report directly to City Council outlining the "costs and the source of funds" necessary for the hearing, presumably in connection with the retention of external expert assistance.

Comments and/or Discussion and/or Justification:

Staff from the City Planning Division will provide preparatory assistance and will appear before the board in support of the City's position on the appeal, and accordingly, there is no requirement to retain external expert assistance at this time.

Conclusions:

No funding is required for external expert assistance at this time.

Contact Name:

George Leonard

Lawyer, Planning and Administrative Tribunal Law

Legal Services

Phone: 392-6693

Fax: 696-4177)

(City Council on May 11 and 12, 1999, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee reports having received the following report (April 20, 1999) from the Commissioner of Corporate Services; and directed that a copy thereof be forwarded to Council for information:

Purpose:

The Year 2000 Business Continuity Plan Status Report (April 1999) outlines the following information as requested by Council at its November 1998 meeting:

(i) Status report of each priority 1Year 2000 function;

(ii) Status report on the ABC's and their state of readiness;

(iii) Status report on expenditures for priority 1 Year 2000 functions; and

(iv) Change requests.

Funding Sources:

No funding is required at this time.

Recommendations:

It is recommended that:

(1) this report be received for information; and

(2) the Strategic Policies and Priorities Committee refer this report to Council for its information.

Comments:

Communication Update:

The Communication Plan was approved by Council at its April meeting. The plan outlined the requirement to establish a community liaison to act as a contact point for community groups wishing to prepare their communities. A statement of work has since been developed and work is progressing.

The City's Year 2000 team has participated in numerous public forums. These included sessions held at the St. Lawrence Centre, Trinity Church and the Bellefair United Church. In addition, presentations have been made to the Canadian Bankers Association and the Greater Toronto Services Board. The Internet site is now available on the City of Toronto site.

Status report on Priority One business functions:

Contingency Plan:

Three separate reports have been documented for each Department. One of the reports examines the critical project milestones and the dates set against each of them. Projects are evaluated on whether they are making "sustainable" progress toward completion. This is used to track and plot the Risk Assessment graph maintained by the Project Office. This is evaluated on a monthly basis.

Each of the Risk Managers has examined and engaged each department with the need for any improvements. At this time the Project Office is satisfied that the appropriate effort is under way to achieve this.

A lot of time has been devoted to define the Year 2000 Project contingency plan scope and each Commissioner has been asked to review this report and to approve it for their department.

Departmental Critical One Business Functions:

In November 1998 the City of Toronto's Year 2000 program outlined critical milestones for the City's Priority 1 Year 2000 initiatives. These milestones included September 1998 for the completion of the inventory and October 1998 for the completion of the assessment. All City Departments met both of these objectives. The upcoming milestone is the completion of all remedy, which includes activities such as code conversion, system upgrades and system replacement, by the end of April 1999. The next critical phase is the testing phase whereby each Department verifies that the solutions implemented continue to meet their business requirements and functions properly through critical dates such as January 1, 2000 and February 29, 2000. The testing phase is targeted for completion by the end of September 1999. By October 1999 the objective is to have all solutions back in operation in preparation for the millennium change. Each Commissioner will be expected to approve the verification results and to recommend moving the solution into operation. This will demonstrate their satisfaction with the work conducted by their Department to ensure business as usual on January 1, 2000, and through the millennium.

Numerous priority 1 business functions are currently projected to be year 2000 ready ahead of the City's milestones. These include the majority of public health and safety services such as Water Supply, Water Pollution Control, Solid Waste Management, Transportation Management, Traffic Control, Ambulance Services and Fire Services. The Year 2000 Project Office, the Steering Committee and each Commissioner are monitoring the progress of each business case to make sure target dates are met. You will find in Appendix 1 the status summary of each business case including the percentage complete.

In an effort to further reduce risk, the Year 2000 program office is working with each Commissioner to determine strategies for moving up the implementation date for critical business functions to ensure maximum completion by September 30, 1999. These revised completion dates will be reported to Strategic Policies and Priorities Committee in May 1999.

Status Report on Agencies, Boards and Commissions (ABCs):

The ABC Management Team delivered an "ABC Support Report" to the Year 2000 Steering Committee on March 24th, 1999. This report, which has been accepted, contains the processes by which Departmental Project Managers can establish City responsibilities for ABC's Year 2000 preparedness. The processes ensure that ABC support decisions will be made selectively yet consistently, with appropriate knowledge and consideration.

The ABC Management Team has communicated the decision processes by:

(i) presenting at the March 29th Project Manager Information Session;

(ii) meeting with Departmental Project Managers or their designates for every Department that has associated ABCs, and reviewing the decision processes with them;

(iii) distributing background information to all Commissioners to ensure they are aware of their associated ABCs in accordance with the report adopted by Council, and to offer assistance by answering questions and addressing concerns; and

(iv) scheduling information sessions with the appropriate ABCs to ensure key players have a full understanding of the City's role with regard to year 2000 preparedness.

Status report from Toronto Police:

The following summaries have been prepared for each critical area of the Police's Year 2000 planning and remediation to provide the most recent accomplishments:

Emergency Preparedness:

A draft operational plan is being prepared and will be available for internal distribution to executive police management by May 31, 1999. Aspects of this plan will be reported to the Police Services Board and Council by the end of June 1999.

Information Processing:

The Service remains on track in converting and testing its information systems in keeping with system A-D prioritization. The status is as follows:

(a) Priority A: 95 percent of the remediation work for applications in this category is complete. They have not all been implemented as several are dependent on the deployment of the NT desktop operating system which will take place over the next five months;

(b) Priority B: 5 of the 22 systems in this category are complete; the rest are expected to meet their target date;

(c) Priority C: 5 of the 30 systems in this category are complete; the rest are expected to meet their target date; and

(d) Priority D: 4 of the 13 systems in this category are complete; the rest are expected to meet their target date. System completion in this category is higher than first anticipated due to system enhancements related to the NT operating system rollout.

System owners have begun work to develop information processing contingency plans to enable the Service to continue the collection, recording and storage of information in the event of system failures.

Facilities and Equipment:

Progress is continuing in preparing a list of Service assets, which may or may not be Y2K compliant. Remediation plans and funding requirements will be identified by June 1999 in keeping with priority A-D classifications.

Y2K Leadership:

The first meeting of the Police Executive Y2K Steering Committee is to be scheduled by the end of April 1999.

Members of the Service are continuing to work diligently to address Y2K challenges to ensure their preparedness to deliver high quality police services in the new millennium.

Status report from Toronto Hydro:

Getting the power to Hydro's distribution system is a big part of the equation that is going to determine whether the lights stay on when all the clocks in Toronto strike midnight on January 1, 2000. Judging from the success of the large-scale time shift test in central and west Toronto, Ontario Hydro's efforts to secure the supply of electricity to Toronto Hydro appear to be working.

To prepare for the other part of the equation distributing the power to their customers, Toronto Hydro is putting forward a huge corporate effort to ensure the distribution system is up and running on January 1, 2000. First of all, Toronto Hydro got a leg up on its Y2K readiness through the integration process by eliminating systems that were not ready. The Hydro's Year 2000 office and Toronto Hydro's IT experts are working closely with staff responsible for the systems to make sure they are Y2K ready. Jointly, every system and every single piece of equipment throughout the organization have been looked at. Priorities have been established and they have assessed the Y2K readiness of those items that affect Hydro's corporate goals.

Hydro's target is to have all critical systems tested and ready by June 30, 1999. Steps have been identified to be followed to remediate and test the items that are not Y2K ready. A lot of effort is going into testing. Hydro is not content to sit back and assume the systems will work. Year 2000 also happens to be a leap year, and there are other dates that might pose a problem - like 9/9/99- so Hydro is setting their clocks ahead to see if the systems work through those dates.

Almost all critical items will be tested, with only those systems for which Y2K readiness is firmly guaranteed by vendors or manufacturers and backed up by accepted, documented test being exempt. The Hydro team is tracking progress on critical systems and providing help wherever it is needed to meet its deadline. If something is not ready, it is fixed and tested all over again.

Although Hydro expects a smooth transition to the year 2000, Hydro still has to plan for even the most unlikely events. Toronto Hydro is starting the process of Y2K contingency planning to prepare for any potential problems that may arise on December 31, 1999. Most contingency plans consider a single issue as the emergency and assume that all other facilities and resources are fully operational. Hydro's Y2K contingency planning considers all sorts of reasonable combinations assuming that services and facilities may not be fully available. Specific scenarios with Hydro, the City of Toronto, essential service providers and other stakeholders are being discussed. The task is to figure out how Hydro would respond if any of those worst-case scenarios materialized.

No one can guarantee Hydro will be 100 percent problem free as the new century approaches, but everything possible is being worked on to ensure lights stay on January 1, 2000.

Status report on TTC, March 28, 1999:

Summary:

Project plans to remediate business applications, technology infrastructure and embedded systems are in place, and detailed plans have been integrated into a master plan. Integrated databases have been built to track the inventory of applications to be remediated, embedded systems, as well as the technical infrastructure.

Current remediation efforts for critical applications and embedded systems are expected to be completed by September 1999. Exceptions to this include a small number of replacement business applications, such as Scheduling, Timeline, and Engineering Document Control. Individual project plans are being tracked closely, and no critical delays are expected.

Contingency and continuity planning is well under way, to accommodate both IT application failures and external problems related to power supply, communications, water etc. which will significantly impact service. A Contingency Task Force has been established within TTC with senior representation from each Branch.

A communications strategy has been developed, and an Intranet site to disseminate Y2K information to TTC employees is nearing completion.

Progress:

Details on progress by group, project, and project phase are represented in the TTC's Y2K Progress Chart attached (see attachment 2). The chart represents the seven major phases of the TTC's Year 2000 project: Initiation, Inventory, Assessment, Remediation or Replacement, Testing, Implementation, and Post Implementation. The Y2K Compliant Date represents the forecast Implementation or Production completion date. The percent complete is based on the amount of work accomplished.

A number of critical applications have recently been certified and put into production. These include the Metropass Discount Plan, the Ticket Order Processing System, and the Delay Logs application, which monitors service delays. As well, the voice systems used by the Commission have been Y2K certified.

Status report on the City of Toronto's expenditures:

Attached is a status report on the $149.6 million allocated to the Y2K project to remedy all Priority 1 business functions. As of March 31, 1999, a total of $26 million has been committed or spent. For March 1999, $4.7 million has been committed. The majority of this expenditure is again for resources, software licenses, hardware, servers, and network equipment. See Attachment 3.

Change requests:

Facilities:

Facilities and Real Estate requested that each department be given the ability to exclude non-essential items from the physical inventory at the discretion of the Department responsible for them. The excluded items should be those that are not required to perform the essential business of the Department. In the event of a failure of these items, the Department currently responsible for maintenance of the item will be responsible for its repair and replacement. This was approved by the Y2K Steering Committee at its April 8, 1999, meeting.

Corporate Services:

Document Management - Legal Department:

Funding in the amount of $174,150.00 was requested to hire a Project Manager to manage the Y2K efforts at a detail level on behalf of Legal, specifically for document management. Tasks also include business analysis, application architecture, and co-ordination efforts for Legal. This has been approved by the Y2K Steering Committee at its April 8, 1999, meeting.

Legal Y2K File Management Projects:

Funding in the amount of $183,600.00 was requested to hire an external Project Manager to ensure project management continuity until all Year 2000 systems solutions are ready. This has been approved by the Y2K Steering Committee at its April 8, 1999 meeting.

Finance:

Payroll and Benefits:

Changes were approved to the Payroll and Benefits business continuity strategy for the former Municipality of Metropolitan Toronto and the former City of Scarborough payroll. The changes include the upgrade and year 2000 testing of the existing Time Entry System (TES) and the Cyborg system. The previous strategy of rerunning payroll tapes for three months proved unacceptable for such a sustained period of time. It is however acceptable as a short-term contingency solution. No additional funding is required.

Works and Emergency Services:

Transportation:

Funds in the amount of $78,645.00 was requested from the Y2K contingency fund to support the Y2K testing effort for the mainframe applications used by Transportation Services. While these applications were initially assessed as Critical 2 or 3, upon review, each of the major applications actually meet the parameters for Criticality 1 ranking. As the City-wide mainframe project is already undertaking remediation on these applications, it is essential that the Departmental Year 2000 project be able to design and execute test plans to ensure business readiness. These include Permit Parking and Right-of-Way applications. This has been approved by the Y2K Steering Committee at its April 8, 1999, meeting.

City Wide Initiatives:

Desktop:

The City is currently using a number of different e-mail (messaging) systems, all based upon proprietary, often incompatible and non-year 2000 ready technology. This makes effective communication between systems and remote sites extremely difficult and problem prone.

It is necessary to standardize on one technological platform for messaging and workflow in order to achieve Year 2000 readiness and thereby enable business continuity in Year 2000. In addition to ensuring business continuity, all users will benefits from the functionality these products can provide. The adoption of one product will enable corporate-wide use of calendar management, setting up meetings, automated workflow, and document transfer. As well, remote and mobile users will be fully supported so that ubiquitous access to the system will be possible, regardless of where the user is logging on. This will facilitate future moves of staff and any work-from-home or hoteling initiatives. Support costs should diminish as the older systems are put out of service.

One hundred and twenty-six companies were invited to submit proposals. An evaluation team, consisting of representatives from the Police Services Board, Metro Zoo, Purchasing and Materials Management and the Information and Technology Division, used the evaluation criteria and the ranking mechanism identified in the Request for Proposal. They selected BEI Metastorm and their bid partner DTM Information Group as the successful proponent for the implementation of the Groupwise messaging product and a companion workflow product. Their bid ranked highest in the evaluation and presented the solution with the lowest cost and risk to the City. The Manager, Fair Wage and Labour Trades office has reported favourably on the firm recommended. The funds were budgeted as part of the Year 2000 Desktop initiative. This change request was approved by the Year 2000 Steering Committee.

Conclusion:

The City of Toronto's Year 2000 readiness program is moving forward as anticipated. Council will continue to receive progress reports as requested.

Contact:

Lana Viinamae, Director Year 2000.

(Copies of Appendices 1, 2 and 3 attached to the foregoing report were forwarded to all Members of Council with the May 4, 1999, agenda of the Strategic Policies and Priorities Committee; and copies thereof are also on file in the office of the City Clerk.)

(City Council on May 11 and 12, 1999, received this Clause, for information.)

(a) Ontario Hydro Corridor Lands South Of Highway 401

(Ward 14 - Scarborough Wexford And Ward 15 Scarborough City Centre)

The Strategic Policies and Priorities Committee reports having:

(1) referred the Recommendations of the Budget Committee embodied in the following communication to the Scarborough Community Council for review and recommendations thereon;

(2) requested the Commissioner of Works and Emergency Services to submit a report to the next meeting of the Scarborough Community Council on how this acquisition fits in with the City's stated objective for pedestrian/bicycle paths in Scarborough, and on whether the funds being requested could be better spent in Scarborough to achieve that objective; and

(3) requested the Commissioner of Economic Development Culture and Tourism, in consultation with the Chief Financial Officer and Treasurer, to submit a report to the aforementioned meeting of the Scarborough Community Council, on the original intent of the Beare Road landfill reserve:

(April 30, 1999) from the City Clerk, advising that the Budget Committee on April 30, 1999, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the recommendations of the Corporate Services Committee embodied in the communication (April 22, 1999) from the City Clerk, viz:

(1) the additional lands required to increase the developers 0.3 acres to one full acre be purchased by the City from the developer, to be funded from the Beare Road Trust Fund; and

(2) consideration be given to fund portions of the Priority 2 and 3 lands north of Highway No. 401 in the three existing communities of Wishing Well and North and South Bridlewood; and that this be funded on a proportional basis from the Beare Road Trust Fund,

subject to adding the following:

"that the costs associated with the purchase of the lands be no more than the balance in the Beare Road Trust Fund."

Respectfully submitted,

MEL LASTMAN

Chair

Toronto, May 4, 1999

(Report No. 9 of The Strategic Policies and Priorities Committee, including additions thereto, was adopted, as amended, by City Council on May 11 and 12, 1999.)