November 22, 2016
The City of Toronto is launching several modernization initiatives to improve service to the public while producing substantial cost savings.
Service Modernization Project
Following an extensive internal review, the City of Toronto will introduce a new service delivery model that incorporates three high-level objectives:
The benefits of the proposed model include:
The City projects savings of approximately $8 million beginning in 2021 from moving services from primarily traditional channels (telephone and counter) to digital channels. Through the creation of two new service hubs in 2017, short-term potential cost savings and cost avoidance for 2016-2017 are approximately $1.1 million.
City staff will bring forward a report on this strategy to Government Management Committee and City Council in the first quarter of 2017.
Office Modernization Program
The Office Modernization Program (OMP)began with three pilot projects that aim to change work habits and improve staff engagement, productivity and collaboration while modernizing technology in the work environment. The program optimizes the City’s real estate portfolio with the aim of achieving cost savings and reducing environmental impacts by collapsing leases and avoiding entering into new leases.
The three pilot projects include:
The benefits of the OMP include:
Through this project, the City aims to realize cost savings of approximately $4 to $6 million annually through the collapse of 15 other city leases that expire between 2015 and 2020.
As a result of space savings generated by the first two pilot projects (Metro Hall 15th and 2nd floors), the City has already saved approximately $1 million annually in gross lease costs by collapsing two leased locations and repatriating those workspaces into City-owned space.
The pilot projects at Metro Hall have resulted in a 40% improvement in employee satisfaction and reduced per employee office space from approximately 170 sf to approximately 130 sf.
A staff report on the Office Modernization Project will be presented to the Government Management Committee and City Council in the spring of 2017.
City-wide Real Estate Program
At the direction of Council, the City retained third-party expertise to conduct a review of the City’s current real estate operating model and provide recommendations for improvement. The subsequent staff report to City Council, which recommended consolidating all real estate entities into a centralized service delivery model, was approved by Toronto City Council on July 12, 2016.
By moving to a centralized operating model, the City of Toronto will:
The City-wide Real Estate Review estimates there is approximately $30 to $60 million of savings (five to 10 per cent) in the $600-million cumulative operating budget of all real estate and facilities management operations (excluding Toronto Community Housing and Parks, Forestry and Recreation) once changes are fully implemented.
In addition, the City would generate revenues estimated at five to 10 per cent of the portfolio value, excluding parkland. This would be achieved through a combination of process improvements, efficiencies in procurement and capital project delivery, improved asset management and utilization, alternative service delivery and portfolio optimization initiatives.
The transition to a centralized model is expected to take two to four years. Immediate next steps include conducting a series of visioning sessions and workshops with key stakeholders, development of a transition strategy and bringing forward a staff report to Executive Committee and City Council in the second quarter of 2017 requesting the adoption of a transition strategy.
Media contact: Natasha Hinds Fitzsimmins, Strategic Communications, 416-392-8889,