City of Toronto  
HomeContact UsHow Do I...?Advanced search
Living in TorontoDoing businessVisiting TorontoAccessing City Hall
 
Accessing City Hall
Mayor
Councillors
Meeting Schedules
   
   
  City of Toronto Council and Committees
  All Council and Committee documents are available from the City of Toronto Clerk's office. Please e-mail clerk@city.toronto.on.ca.
   

 

TABLE OF CONTENTS

REPORTS OF THE STANDING COMMITTEES

AND OTHER COMMITTEES

As Considered by

The Council of the City of Toronto

on February 4, 5 and 6, 1998

STRATEGIC POLICIES AND PRIORITIES COMMITTEE

REPORT No. 2

1 Collective Bargaining Agreement - Local 113, Toronto Firefighters' Association

2 Separation Program for Executive Management and Non-Union Staff

3 Contract No. T-8-98 - Bathurst Street Bridge over the Toronto Terminal Railways South of Front Street -Structure Rehabilitation

4 Contracts Nos. T-43-98 and T-44-98 -Minor Bridge Repairs on Metropolitan Roads

5 Contracts Nos. T-2-98, T-3-98, T-4-98 and T-5-98 -Permanent Repairs to Utility Road Cuts

6 Contracts Nos. T-6-98, T-7-98, T-21-98 and T-22-98 -General Maintenance of Metropolitan Roads

7 1998 Operating and Capital Budgets -Schedule and Public Consultation Process

8 1998 Capital Works Program - Preliminary Targets andStatus Report on Outstanding Debt of the City of Toronto

9 Financial Relationships with theToronto District School Boards

10 Expenditure Reduction Proposals -Cost of Salaries, Wages and Benefits

11 1998 Operating Budget - A Phased Review Approach

12 1998 Interim Capital Budget - Capital Projects Requiring Urgent Financing Approval

13 Other Items Considered by the Committee

City of Toronto


REPORT No. 2

OF THE STRATEGIC POLICIES AND PRIORITIES COMMITTEE

(from its meeting on February 3, 1998,

submitted by Mayor Mel Lastman, Chair)


As Considered by

The Council of the City of Toronto

on February 4, 5 and 6, 1998


1

Collective Bargaining Agreement - Local 113,

Toronto Firefighters' Association

(City Council on February 4, 5 and 6, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends:

(1) the adoption of the recommendation of the Corporate Services Committee embodied in the following transmittal dated January 20, 1998, from the Corporate Services Committee; and

(2) that Council resolve itself into Committee of the Whole to give consideration, in camera, to the confidential report dated January 16, 1998, from the Commissioner of Human Resources, a copy of which has been forwarded to all Members of Council under "confidential" cover:

Recommendation:

The Corporate Services Committee on January 20, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, that no further action be taken respecting the matter of the Collective Bargaining Agreement - Toronto Firefighters' Association.



Background:

The Corporate Services Committee on January 20, 1998, had before it:

(i) a confidential report (January 16, 1998) from the Commissioner of Human Resources respecting the Collective Bargaining Agreement - Toronto Firefighters' Association; and

(ii) a communication (January12, 1998) from the Toronto City Clerk advising that City Council on January 2, 6, 8 and 9, 1998, had before it a notice of motion moved by Councillor Adams and Councillor Walker, and a confidential joint report dated January 8, 1998, from the Commissioner of Human Resources and the Functional Lead for Legal Services respecting the Toronto Firefighters' Association Collective Bargaining Agreement, and that Council referred the aforementioned motion and report to the Corporate Services Committee for further consideration and the Commissioner of Human Resources was requested to submit a further report thereon to the Committee.

Mr. Mark Fitzsimmons, President, Local 113, Toronto Firefighters' Association, appeared before the Corporate Services Committee in connection with the foregoing matter.

(Extract from the confidential report dated January 16, 1998,

addressed to the Corporate Services Committee from

the Commissioner of Human Resources)

Recommendations:

It is recommended that:

(1) Council not approve the aforementioned settlement;

(2) Council direct staff to resume negotiations with Local 113 of the Toronto Fire Fighters Association with a view towards concluding a collective agreement consistent with other fire and municipal settlements for the years 1996 and 1997; and

(3) the Functional Lead for Legal Services be authorized to commence legal proceedings to set aside and quash the Award of the Board of Arbitration including any necessary interim proceedings to stay the enforcement of the Award and to defend any legal proceedings commenced by the Firefighters Association against the City of Toronto, including contempt proceedings and proceedings to quash the decision of the Financial Advisory Board.

2

Separation Program for Executive Management and

Non-Union Staff

(City Council on February 4, 5 and 6, 1998, adopted the joint confidential report dated January 19, 1998, from the Commissioner of Human Resources, Chief Financial Officer and Treasurer and the Chief Administrative Officer, embodying the following recommendations, as amended by the Budget Committee at its meeting held on January 26, 1998:

"It is recommended that:

(1) Council adopt the Separation Program for Executive, Management and Non-Union staff;

(2) this program replace all separation or exit programs, policies and practices in the former municipalities;

(3) all employees of the (new) City of Toronto be advised that separation or exit programs, policies and practices which may have been in place in the former municipalities are no longer in force;

(4) Council approve the establishment of a Workforce Reduction and Retraining Reserve to accommodate the funding for the Separation Program for Executives, Management and Non-Union staff, with initial funding of $10 million to be allocated from existing reserve funds;

(5) the Chief Financial Officer and Treasurer request the Province of Ontario for assistance in funding the Separation Program required as a result of the amalgamation dictated by the City of Toronto Act, 1997; and

(6) the Chief Administrative Officer, Chief Financial Officer and Treasurer and the Commissioner of Human Resources be authorized to take all the necessary steps to implement these actions and to administer the Workforce Reduction Strategy."

Council also adopted the report dated February 3, 1998, from the Chief Administrative Officer, subject to:

(1) amending Recommendation No. (1) by:

(a) inserting the words "or an Agency, Board or Commission funded in whole or in part by the City", after the words "City of Toronto"; and

(b) inserting the words "or employment", after the words "for re-employment";

(c) deleting the words "five years" and inserting in lieu thereof the words "two years";

(2) amending Recommendation No. (2) by:

(a) deleting the words "with the approval of the Chief Administrative Officer in consultation with the Chair of the Corporate Services Committee. Exceptions beyond six months must receive the approval of Council", after the words "in duration", and inserting in lieu thereof the words "on recommendation of the Chief Administrative Officer for approval by City Council"; and

(b) adding thereto the words "such policy to apply whether employees are hired as consultants or employees";

(3) striking out and referring Recommendations Nos. (3) and (4) back to the Chief Administrative Officer for further consideration and report thereon to the Corporate Services Committee, together with the following motions:

Moved by Councillor Pantalone:

"That the foregoing Clause be amended by inserting in Recommendation No.(3) the word 'permanent' after the words 'applied to'."

Moved by Councillor Holyday:

"That the foregoing Clause be amended by striking out Recommendation No.(4) and inserting in lieu thereof the following:

'(4) the re-employment policy also apply to former Members of Council seeking employment with the municipality, and that they should not be allowed to seek employment with the municipality during their severance period.' "

so that the recommendations embodied in the confidential report dated February 3, 1998, from the Chief Administrative Officer, shall now read as follows:

"(1) employees who receive an exit or retirement package from the City of Toronto or an Agency, Board or Commission funded in whole or in part by the City, or who received an exit or retirement package from one of the seven former municipalities, will not be eligible for re-employment or employment by the municipality for a period of two years; and

(2) in limited, exceptional circumstances, any employee may be re-employed on a contract basis, for a defined period of time not to exceed six months in duration, on recommendation of the Chief Administrative Officer for approval by City Council, such policy to apply whether employees are hired as consultants or employees."

Council also adopted the following recommendations:

"It is further recommended that:

(1) any firm that is bidding on a contract with the City of Toronto and has hired a former senior management employee of the former Metropolitan Toronto or Area Municipal governments shall be required to provide the name of that former employee to the City;

(2) the Special Committee to Review the Final Report of the Toronto Transition Team be requested to re-examine why the Strategic Policies and Priorities Committee and the Budget Committee review and make recommendations respecting Human Resources issues, given the existence of a Corporate Services Committee;

(3) the Chief Administrative Officer be requested to ensure that human resources issues are submitted to the Corporate Services Committee for consideration, in accordance with the provisions of the Council Procedural By-law; and

(4) the Chief Financial Officer and Treasurer be requested to submit a report to the Strategic Policies and Priorities Committee identifying the reserve fund sources and amounts allocated to the Workfare Reduction and Retraining Reserve; such report to also address whether such reserve can be self-funded from separation savings.")

The Strategic Policies and Priorities Committee recommends:

(1) the adoption of the joint confidential report (January 19, 1998) from the Commissioner of Human Resources, Chief Financial Officer and Treasurer and the Chief Administrative Officer, as amended by the Budget Committee at its meeting held on January 26, 1998, respecting a Separation Program for Executive Management and Non-union staff;

(2) the adoption of the report (February 3, 1998) from the Chief Administrative Officer respecting a restrictive policy for re-employment of staff who have received an exit or retirement package; and

(3) that Council resolve itself into the Committee of the Whole to give consideration, in camera, to such reports.

The Strategic Policies and Priorities Committee reports, for the information of Council, having requested the Chief Administrative Officer and the Commissioner of Human Resources to consider when looking at any downsizing, that all non-union staff be treated in a fair and equitable manner and on the same basis as the union staff; and further that the Globe and Mail and all media be advised of the foregoing.

(A copy of each of the aforementioned reports has been forwarded to all Members of Council under "confidential" cover.)

(Extract from the confidential joint report dated January 19, 1998,

addressed to the Strategic Policies and Priorities Committee

from the Commissioner of Human Resources

and the Chief Financial Officer and Treasurer.)

"It is recommended that:

(1) Council adopt the Separation Program for Executive, Management and Non-Union staff;

(2) this program replace all separation or exit programs, policies and practices in the former municipalities;

(3) all employees of the (new) City of Toronto be advised that separation or exit programs, policies and practices which may have been in place in the former municipalities are no longer in force;

(4) Council approve the establishment of a Reserve for Workforce Reduction to accommodate the funding for the Separation Program for Executives, Management and Non-Union staff, with initial funding of $10 million to be allocated from existing reserve funds;

(5) the Chief Financial Officer and Treasurer request the Province of Ontario for assistance in funding the Separation Program required as a result of the amalgamation dictated by the City of Toronto Act, 1997; and

(6) the Chief Administrative Officer, Chief Financial Officer and Treasurer and the Commissioner of Human Resources be authorized to take all the necessary steps to implement these actions and to administer the Workforce Reduction Strategy."

(City Council on February 4, 5 and 6, 1998, had before it, during consideration of the foregoing Clause, a confidential communication (January 28, 1998) from the City Clerk addressed to the Strategic Policies and Priorities Committee, forwarding recommendations from the Budget Committee respecting a separation program for executive, management and non-union staff.)

(Report dated February 3, 1998,

entitled "Re-Employment Policy",

from the Chief Administrative Officer, referred to above)

Purpose:

This report will respond to comments by the Strategic Policy and Priorities Committee, at its meeting of January 19, 1998, and by the Budget Committee, at its meeting of January 25, 1998, with respect to the policy for re-employment of staff who have received an exit or retirement package.

Financial Implications:

There are no financial implications.

Recommendations:

It is recommended that

(1) employees who receive an exit or retirement package from the City of Toronto or who received an exit or retirement package from one of the seven former municipalities, will not be eligible for re-employment by the municipality for a period of five years;

(2) in limited, exceptional circumstances, any employee may be re-employed on a contract basis for a defined period of time not to exceed six months in duration, with the approval of the Chief Administrative Officer in consultation with the Chair of the Corporate Services Committee, exceptions beyond six months must receive the approval of City Council;

(3) this policy would be applied to staff who previously worked for Councillors and the Mayor; and

(4) Council determine if this policy should be applied to former Members of Council seeking employment with the municipality.

Discussion:

A report was before both the Strategic Policies and Priorities Committee and the Budget Committee with respect to a separation program for executive, management and non-union staff. Contained in the report was a proposed policy on re-employment of staff who receive an exit or retirement package from the municipality.

The proposed policy recommendations have been amended based on suggestions by Committee members.

The Budget Committee requested that Council determine if this policy should also be applied to former Members of Council who may seek employment with the Municipality.



3

Contract No. T-8-98 - Bathurst Street Bridge over the

Toronto Terminal Railways South of Front Street -

Structure Rehabilitation

(City Council on February 4, 5 and 6, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January28,1998) from the Budget Committee:

Recommendation:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee the adoption of the report (December 15, 1997) addressed to the Urban Environment and Development Committee from the Commissioner of Transportation, which recommended that:

"(1) financing in the amount of $2,161,173.58 gross, $1,253,173.00 net, to be debentured (if necessary) for a term up to but not exceeding 20 years, be approved for this project;

(2) pre-budget approval be granted in the amount of $2,161,173.58 gross, $1,253,173.00 net to accommodate the rehabilitation of the Bathurst Street bridge;

(3) Part "A" of Contract No. T-8-98 for the rehabilitation of the Bathurst Street bridge over the Toronto Terminal Railways south of Front Street, be awarded to Grascan Construction Ltd. and Torbridge Construction Ltd. who submitted the lowest price bid in the amount of $1,909,813.58;

(4) D.S. Lea Associates Ltd. be retained to perform the construction supervision for this project; and

(5) the appropriate City of Toronto officials be directed to take necessary action to give effect thereto."

The Budget Committee reports that it has included the Bathurst Street Bridge project in the 1998 Interim Capital Budget.

Background:

The Budget Committee had before it a report (January 21, 1998) from the Strategic Policies and Priorities Committee, advising that it referred the transmittal letter (January 13, 1998) from the Urban Environment and Development Committee, advising that the Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December 15,1997) from the Commissioner of Transportation, recommending the award of a contract for the rehabilitation of the Bathurst Street Bridge, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and 5, 1998.

--------



(Report dated December 15, 1997, addressed to the

Urban Environment and Development Committee from the

Commissioner of Transportation)

Purpose:

To award a contract for the rehabilitation of the Bathurst Street bridge over the Toronto Terminal Railways south of Front Street.

Funding Source:

The Transportation Department's 1998-2002 Capital Works Program Estimates include an amount of $11,600,000.00 gross, $9,933,000.00 net, under Project No. C-TRO55, Bridge Reconstruction Program. Contract No. T-8-98 forms part of that program, and the estimated total project cost for Part "A" including contingencies and supervision is $2,161,173.58 gross, $1,253,173.00 net. Approximately $908,000.00 is recoverable from Bell Canada, Toronto Hydro, CN Railways and the Toronto Transit Commission. This project was also included as part of the Metropolitan Toronto Transportation Department's approved 1997-2001 Capital Works Program. The total project cost is:

(1) Bid Price Amount Part "A" $1,909,813.58

(2) (a) Design 51,450.00

(b) Construction supervision, 22 weeks at

$3,805.00 per week (estimate) 83,710.00

(c) Traffic management study 16,200.00

(3) Other costs (estimate) 100,000.00

(a) Quality control testing

(b) Traffic signage ____________

Total Project Cost Part "A" $2,161,173.58

____________

To accommodate this work both capital financing and pre-budget approval in the amount of $2,161,173.58 gross, $1,253,173.00 net, is required at this time. An expenditure of $1,253,173.00 for this project can be financed by the issuance of debentures for a term up to, but not exceeding, 20years.

Recommendations:

It is recommended that:

(1) financing in the amount of $2,161,173.58 gross, $1,253,173.00 net, to be debentured (ifnecessary) for a term up to, but not exceeding, 20 years, be approved for this project;

(2) pre-budget approval be granted in the amount of $2,161,173,58 gross, $1,253,173.00 net to accommodate the rehabilitation of the Bathurst Street bridge;

(3) Part "A" of Contract No. T-8-98, for the rehabilitation of the Bathurst Street bridge over the Toronto Terminal Railways south of Front Street, be awarded to Grascan Construction Ltd. and Torbridge Construction Ltd. who submitted the lowest price bid in the amount of $1,909,813.58;

(4) D. S. Lea Associates Ltd. be retained to perform the construction supervision for this project; and

(5) the appropriate City of Toronto officials be directed to take necessary action to give effect thereto.

Comments:

On December 4, 1997, the Metro Clerk's Department opened tenders for:

Contract No. T-8-98 Bathurst Street bridge over the TTR

Structure Rehabilitation

No. Name Part A Part B Total (A + B)

6 Grascan Construction Ltd. 1,909,813.58 1,044,728.74 2,954,542.32

and Torbridge Construction Ltd.

2 G. Tari Limited 2,450,819.49 1,119,656.56 3,570,476.05

8 Dufferin Construction Co. 2,435,286.83 1,278,194.93 3,713,481.76

4 Armbro Construction Ltd. 2,683,544.67 2,415,338.64 5,098,883.01

5 Soncin Construction Corp. 2,437,311.32 1,330,463.77 3,767,775.09

7 Brennan Paving and Construction Ltd. 2,629,095.48 1,200,328.12 3,829,423.60

3 Bridgecon Construction Ltd. 2,710,793.08 1,540,113.69 4,250,906.77

9 Underground Services Ltd. 2,912,762.60 1,570,734.32 4,687,390.30

1 Graham Bros. Const. Ltd. 3,195,232.93 1,563,887.82 4,759,120.75

Tenders Nos. 3, 4 and 7 contained minor errors in the extension of the unit prices. The revised figures are shown above.

The award is subject to receipt of a favourable report from the Fair Wage and Labour Trades Office regarding working conditions and wages of the recommended contractor and his sub-contractors, and also from the Chief Financial Officer regarding the surety company which issued the Bid Bond and Agreement to Bond.

Scope of Work:

The work in this Contract comprises the rehabilitation of the Bathurst Street bridge over the Toronto Terminal Railways south of Front Street. The work is divided into two sections, Parts "A" and "B".

Work in Part "A" comprises the replacement of the deck at the CNR truss span and the steel plate girder span between Front Street and the Fort York pedestrian ramp. This includes sidewalk replacement on the girder span only, substructure repairs for the entire bridge, aluminum handrail, TTC infill concrete, expansion joints, waterproofing, asphalt paving, utility duct bank structures and structural steel repairs at the CNR truss span.

Work in Part "B" comprises replacement of the spans south of the plate girder span from the Fort York pedestrian ramp to the south end of the structure north of Bremner Boulevard. Also included within the scope of work is a new deck at the Fort York ramp, parapet walls, railings, expansion joints, waterproofing, asphalt paving and streetlighting.

To complete the necessary work in as short a period as possible, this bridge will be closed to all traffic between February and June, 1998. The Toronto Transit Commission (TTC) has agreed to remove streetcars from service between February 14 and June 14, 1998, to accommodate this work. Any time extension beyond June 14, 1998, would severely impact on the waterfront activities and TTC ridership in this corridor. In order to reopen the Bathurst Street bridge for traffic by June 14,1998, only Part "A" of this contract can be completed. As well, future development of the railway lands south of the bridge will likely impact on the required bridge width within the Part "B" section. For example, the TTC has requested widening the bridge south of the plate girder span in order to accommodate a southbound left-turn lane at the proposed Bremner Boulevard intersection. For these reasons, it is recommended that only Part "A" of this contract be awarded at this point in time.

Approval of Consultants:

The Transportation Department maintains a list of approximately 20 bridge consultants, who have expressed an interest in gaining work with the Department. Following a review of four proposals and taking into account their ability to provide the services required to successfully complete the assignment on time and within budget, D. S. Lea Associates Ltd. was selected to design the rehabilitation works and prepare contract documents for this structure. The selection was made in accordance with Metropolitan Toronto's "Policy for Selection of Architects and Professional Consulting Services".

The proposal submitted by these companies also identified their ability, experience and a cost estimate for providing construction supervision services for this project, but no award for these services was made at that time.

Based on the satisfactory performance of this consultant to date and their knowledge of this project, it is appropriate that D. S. Lea Associates Ltd. also be retained to provide construction supervision services for the project as outlined in this report, at a cost not to exceed $3,805.00 per week of construction. The consultant appointment will be subject to the completion of an agreement containing clauses satisfactory to the City Solicitor and the Commissioner of Transportation.

Contact Name and Telephone Number:

Mr. L. Rach, Director of Planning and Engineering, 392-5344.

--------

(Communication dated January 8, 1998, addressed

to the Urban Environment and Development Committee from

Councillor Joe Pantalone, Toronto-Trinity-Niagara)

Recommendation:

That the item be approved; and, further, that the Commissioners of Transportation and Planning initiate the necessary studies for a pedestrian/bicycle overhead link between the foot of Tecumseth Street and the Fort York lands.

The issue of a pedestrian/bicycle link parallel to Bathurst Street to divert pedestrian/bicycle traffic from the Bathurst Street Bridge, south of Front Street, has been supported by the adjacent Niagara neighbourhood and has been envisioned in planning documents for the area west of Bathurst Street.

This link would connect the Niagara and other neighbourhoods to Fort York and its surrounding park-like lands and the Martin Goodman Trail on the Western Waterfront. This pedestrian/bicycle link is particularly required because of the unusual configuration of the Bathurst Street Bridge, a configuration that limits the capacity for pedestrian and bicycle users. This narrow configuration is not unusual on Bathurst Street (as a matter of fact, a bicyclist was killed not far from this area on Bathurst Street at Queen Street West).

Given past planning objectives in favour of this link, given the potentially quick development of the railway lands, the Molson lands in the area, and given its obvious linkage to the present and future traffic flows on Bathurst Street, it makes eminent sense to request our staff to initiate the process so that City Council will, in the future, be in a position to address this issue.

My fellow City Councillor, Mario Silva, is also in strong support of this recommendation.

--------



(Transmittal Letter dated January 21, 1998, addressed to the

Budget Committee from the

Strategic Policies and Priorities Committee)

Action:

The Strategic Policies and Priorities Committee on January 19, 1998, referred the letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and5, 1998.

Background:

The Strategic Policies and Priorities Committee had before it a letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, advising that the Urban Environment and Development Committee on January 12, 1998, recommended the adoption of the report (December 15, 1997) from the Commissioner of Transportation, respecting the award of a contract for the rehabilitation of the Bathurst Street bridge over the Toronto Terminal Railways south of Front Street.

--------

(Transmittal Letter dated January 13, 1998, addressed to the

Strategic Policies and Priorities Committee from the

Urban Environment and Development Committee)

Recommendation:

The Urban Environment and Development Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December15, 1997) from the Commissioner of Transportation respecting Contract No.T-8-98.

The Urban Environment and Development Committee reports, for the information of the Strategic Policies and Priorities Committee, and Council, having:

(1) requested the Interim Functional Leads for Transportation and Planning to initiate the necessary studies for a pedestrian/bicycle overhead link between the foot of TecumsethStreet and the Fort York lands; and

(2) requested the Interim Functional Lead for Transportation to give consideration to any public art opportunities during Part "B" of Contract No. T-8-98.

Background:

The Urban Environment and Development Committee had before it the following report and communication:

(i) (December15, 1997) from the Commissioner of Transportation respecting Contract No.T-8-98 for the structural rehabilitation of the Bathurst Street Bridge over the Toronto Terminal Railways, south of FrontStreet; and

(ii) (January 8, 1998) from Councillor Joe Pantalone, Toronto - Trinity Niagara, recommending that the report (December 15, 1997) from the Commissioner of Transportation regarding Contract No. T-8-98 be approved; and, further, that the Commissioners of Transportation and Planning be requested to initiate the necessary studies for a pedestrian/bicycle overhead link between the foot of Tecumseth Street and the Fort York lands.



4

Contracts Nos. T-43-98 and T-44-98 -

Minor Bridge Repairs on Metropolitan Roads

(City Council on February 4, 5 and 6, 1998, 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 transmittal letter (January28,1998) from the Budget Committee:

Recommendation:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee the adoption of the report (December 16, 1997) from the Commissioner of Transportation, which recommended that:

"the Contracts T-43-98 and T-44-98 for minor bridge repairs on major arterial roads be awarded to Pave-Tar Construction Limited who submitted the lowest price bid in the amount of $312,012.00 and $317,469.00 respectively."

Background:

The Budget Committee had before it a report (January 21, 1998) from the Strategic Policies and Priorities Committee advising that it referred the transmittal letter (January 13, 1998) from the Urban Environment and Development Committee, advising that the Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December 16, 1997) from the Commissioner of Transportation, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and 5, 1998.

(Report dated December 16, 1997, addressed to the

Urban Environment and Development Committee from the

Commissioner of Transportation)

Purpose:

To award two contracts for minor bridge repairs on major arterial roads.

Funding Source:

Funds have been provided in the Municipal Maintenance Management System Account within the 1998 Current Budget Estimates, and monies have been allocated within the Transportation Department's interim appropriation to accommodate these expenditures.

Recommendations:

It is recommended that Contracts Nos. T-43-98 and T-44-98, for minor bridge repairs on major arterial roads, be awarded to Pave-Tar Construction Limited who submitted the lowest price bid in the amount of $312,012.00 and $317,469.00, respectively.

Comments:

On November 27, 1997, the Metro Clerk's Department opened tenders for:

Contract No. T-43-98 Minor Bridge Repairs on "Metropolitan" Roads - East and West Districts

No. Name $ Amount

8 Pave-Tar Construction Limited 312,012.00

11 Brennan Paving and Construction Ltd. 312,616.55

13 Gazzola Paving Limited 316,934.00

4 Anscon Contracting Inc. and Janscon Holdings Inc. 333,786.50

12 Dufferin Construction Company 336,522.49

15 Sentinel Paving and Construction Limited 343,916.73

6 Underground Services (1983) Limited 347,173.06

9 Holloway Philp Construction Limited 354,885.83

5 MSO Construction Limited and T. H. Pounder Construction Ltd. 356,652.40

1 Dagmar Construction Inc. 364,656.00

10 Ferma Road Construction Limited 434,922.90

7 Toronto Zenith Contracting Limited 452,221.59

3 Jarlian Construction Inc. 509,493.87

2 Bridgecon Construction Limited and Bridgecon Holdings Ltd. 611,855.32

14 Armbro Construction Limited 664,151.35

Tenders Nos. 2 and 14 contained minor errors in the extension of the unit prices. The revised figures are shown above.

Contract No. T-44-98 Minor Bridge Repairs on "Metropolitan" Roads - North and South Districts

No. Name $ Amount

7 Pave-Tar Construction Limited 317,469.00

10 Brennan Paving and Construction Ltd. 328,115.00

12 Gazzola Paving Limited 333,840.00

4 Anscon Contracting Inc. and Janscon Holdings Inc. 341,865.00

11 Dufferin Construction Company 353,174.90

6 Underground Services (1983) Limited 364,129.56

14 Sentinel Paving and Construction Limited 365,592.25

8 MSO Construction Limited and T. J. Pounder Construction Ltd. 377,924.00

5 Holloway Philp Construction Limited 382,728.30

1 Dagmar Construction Inc. 383,060.00

9 Ferma Road Construction Limited 454,429.00

13 Jarlian Construction Inc. 524,540.75

2 Bridgecon Construction Limited and Bridgecon Holdings Ltd. 625,815.18

14 Armbro Construction Limited 679,489.59

Tenders Nos. 2, 6 and 13 contained minor errors in the extension of the unit prices. The revised figures are shown above

The award is subject to receipt of a favourable report from the Fair Wage and Labour Trades Office regarding working conditions and wages of the recommended contractor and his sub-contractors, and also from the Chief Financial Officer regarding the surety companies which issued the Bid Bond and Agreement to Bond.

Scope of Work:

The work in Contracts Nos. T-43-98 and T-44-98 includes undertaking minor bridge and structural repairs on various bridges on major arterial roads. This involves repairs to bridge components such as decks, sidewalks, parapets, handrails, bearings etc. and other small structures such as retaining walls and stairs.

Conclusions:

Contracts Nos. T-43-98 and T-44-98 should be awarded to Pave-Tar Construction Ltd. who submitted the lowest bids for these contracts.

Contact Name and Telephone Number:

Mr. C.J. Hebbard, Assistant Director, Road Operations, 392-8320.

--------

(Transmittal letter dated January 21, 1998, addressed to the

Budget Committee from the

Strategic Policies and Priorities Committee)

Action:

The Strategic Policies and Priorities Committee on January 19, 1998, referred the letter of transmittal from the Urban Environment and Development Committee dated January 13, 1998, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and 5, 1998.

Background:

The Strategic Policies and Priorities Committee had before it a letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, advising that the Urban Environment and Development Committee on January 12, 1998, recommended the adoption of the report (December 16, 1997) from the Commissioner of Transportation, respecting the award of Contracts Nos. T-43-98 and T-44-98 for minor bridge repairs on "Metropolitan" roads.

--------

(Transmittal letter dated January 13, 1998, addressed to the

Strategic Policies and Priorities Committee from the

Urban Environment and Development Committee)

Recommendation:

The Urban Environment and Development Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December16, 1997) from the Commissioner of Transportation respecting Contracts Nos.T-43-98 and T-44-98 for minor bridge repairs on "Metropolitan" roads.



5

Contracts Nos. T-2-98, T-3-98, T-4-98 and T-5-98 -

Permanent Repairs to Utility Road Cuts

(City Council on February 4, 5 and 6, 1998, 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 transmittal letter (January28,1998) from the Budget Committee:

Recommendation:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee the adoption of the report (December 16, 1998) from the Commissioner of Transportation, which recommended:

"That the contract for Permanent Repairs to Utility Road Cuts be awarded to the following tenderers who submitted the lowest price bid:

Contract No. Name $ Amount

T-2-98 Ferpac Paving Inc., John Ferzoco Ltd., J.F. Paving Ltd. 760,491.80

T-3-98 Pave-Tar Construction Ltd. 619,503.25

T-4-98 Pave-Tar Construction Ltd. 390,753.30

T-5-98 Brennan Paving & Construction Ltd. 647,246.64"

Background:

The Budget Committee had before it a report (January 21, 1998) from the Strategic Policies and Priorities Committee, advising that it referred the transmittal letter (January 13, 1998) from the Urban Environment and Development Committee, advising that the Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December 16, 1998) from the Commissioner of Transportation, recommending the award of four contracts for permanent repairs to utility road cuts, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and 5, 1998.

--------

(Report dated December 16, 1998, addressed to the

Urban Environment and Development Committee from the

Commissioner of Transportation)

Purpose:

To award four contracts for the permanent repairs to utility road cuts.

Funding Sources:

These contracts are based on estimated quantities that can vary considerably, depending on the level of utility company activity in 1998. All costs are fully recoverable from the appropriate utility company. Funds have been provided in the Transportation Department's 1998 Current Budget Estimates and monies have been allocated within the Department's interim appropriation to accommodate these expenditures.

Recommendations:

It is recommended that the contracts for Permanent Repairs to Utility Road Cuts be awarded to the following tenderers who submitted the lowest price bid:

Contract No. Name $ Amount

T-2-98 Ferpac Paving Inc., John Ferzoco Ltd., J. F. Paving Ltd. 760,491.80

T-3-98 Pave-Tar Construction Ltd. 619,503.25

T-4-98 Pave-Tar Construction Ltd. 390,753.30

T-5-98 Brennan Paving and Construction Ltd. 647,246.64

Comments:

On November 20, 1997, the Metro Clerk's Department opened prequalified tenders in a "Lottery" type order for Contracts Nos. T-2-98 to T-5-98. Procedures for the withdrawal of tenders, in accordance with Ministry of Transportation regulations for prequalified contracts, were applied at the opening. Specifically, at the conclusion of the reading out of bids on each contract and before the opening of tenders on the subsequent contracts, the low bidder on that contract has the opportunity of withdrawing its remaining tenders.

Tenders were opened in the following order:

Contract No. T-3-98 Permanent Repairs to Utility Road Cuts -West District

No. Name $ Amount

6 Pave-Tar Construction Ltd. 619,503.25

2 Ferpac Paving Inc., John Ferzoco Limited, J.F. Paving Ltd. 627,153.75

4 Brennan Paving and Construction Ltd. 649,393.86

7 Sentinel Paving and Construction Limited 728,389.93

1 Warren Bitulithic Limited 750,009.01

5 MSO Construction Ltd. and T.J. Pounder Ltd. 773,396.00

3 Gazzola Paving Limited 879,733.94

8 Ferma Road Construction Ltd. 881,626.50

Tender No. 6 contained a minor error in the calculation of the Goods and Services Tax. The revised figure is shown above.

Contract No. T-4-98 Permanent Repairs to Utility Road Cuts - East District

No. Name $ Amount

6 Pave-Tar Construction Ltd. 390,753.30

4 Brennan Paving and Construction Ltd. 418,568.22

2 Ferpac Paving Inc. John Ferzoco Limited, J.F. Paving Ltd. 432,025.88

7 Sentinel Paving and Construction Ltd. 434,958.85

1 Warren Bitulithic Limited 449,503.68

5 MSO Construction Ltd. and T.J. Pounder Ltd. 480,296.25

3 Gazzola Paving Limited 500,615.55

Contract No. T-5-98 Permanent Repairs to Utility Road Cuts-South District

No. Name $ Amount

4 Brennan Paving and Construction Ltd. 647,246.64

7 Sentinel Paving and Construction Ltd. 664,296.66

2 Ferpac Paving Inc., John Ferzoco Limited and J.F. Paving Ltd. 675,523.10

1 Warren Bitulithic Ltd. 691,971.03

3 Gazzola Paving Limited 790,914.58

5 MSO Construction Ltd. and T.J. Pounder Ltd. 799,557.50

Tender No. 6, submitted by Pave-Tar Construction Ltd., was withdrawn in accordance with procedures for the withdrawal of tenders. Tender No. 3 contained a minor error in the extension of the unit prices. The revised figure is shown above.

Contract No. T-2-98 Permanent Repairs to Utility Road Cuts - North District

No. Name $ Amount

2 Ferpac Paving Inc., John Ferzoco Limited and J.F. Paving Limited 760,491.80

4 Brennan Paving and Construction Ltd. 873,498.46

7 Sentinel Paving and Construction Ltd. 891,391.75

5 MSO Construction Ltd. and T.J. Pounder Ltd. 907,039.00

1 Warren Bitulithic Limited 907,184.84

3 Gazzola Paving Limited 1,030,190.65

8 Ferma Road Construction Ltd. 1,083,910.00

Tender No. 6, submitted by Pave-Tar Construction Ltd., was withdrawn in accordance with procedures for the withdrawal of tenders.

The award is subject to receipt of a favourable report from the Fair Wage and Labour Trades Office regarding working conditions and wages of the recommended contractor and his sub-contractors, and also from the Chief Financial Officer regarding the surety company which issued the Bid Bond and Agreement to Bond.

Conclusion:

Contracts Nos. T-2-98 to T-5-98 inclusive should be awarded to the low bidders.

Contact Name and Telephone Number:

Mr. C. Hebbard, Assistant Director, Road Operations, 392-8320.

--------

(Transmittal letter dated January 22, 1998, addressed

to the Budget Committee from the

Strategic Policies and Priorities Committee)

Action:

The Strategic Policies and Priorities Committee on January 19, 1998, referred the letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and5, 1998.

Background:

The Strategic Policies and Priorities Committee had before it a letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, advising that the Urban Environment and Development Committee on January 12, 1998, recommended the adoption of the report (December 16, 1998) from the Commissioner of Transportation, respecting the award of four contracts Nos. T-2-98, T-3-98, T-4-98 and T-5-98 for permanent repairs to utility road cuts.

--------

(Transmittal letter dated January 13, 1998, addressed to the

Strategic Policies and Priorities Committee from the

Urban Environment and Development Committee)

Recommendation:

The Urban Environment and Development Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December16, 1997) from the Commissioner of Transportation respecting Contracts Nos.T-2-98, T-3-98, T-4-98 and T-5-98 for permanent repairs to utility road cuts.



6

Contracts Nos. T-6-98, T-7-98, T-21-98 and T-22-98 -

General Maintenance of Metropolitan Roads

(City Council on February 4, 5 and 6, 1998, 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 transmittal letter (January28,1998) from the Budget Committee:

Recommendation:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee the adoption of the report (December 16, 1997) from the Commissioner of Transportation, which recommended:

"That the contracts for general maintenance on major arterial roads be awarded to the following tenderers who submitted the lowest price bid:

Contract No. Name $ Amount

T-6-98 Brennan Paving & Construction Ltd. 1,016,214.63

T-7-98 Pave-Al Limited & Orlando Corporation 952,468.53

T-21-98 Warren Bitulithic Limited 894,299.49

T-22-98 Brennan Paving & Construction Ltd. 1,002,436.15"

Background:

The Budget Committee had before it a report (January 21, 1998) from the Strategic Policies and Priorities Committee, advising that it referred the transmittal letter (January 13,1998) from the Urban Environment and Development Committee, advising that the Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December 16, 1998) from the Commissioner of Transportation, recommending the award of four contracts for general maintenance of "Metropolitan" roads, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and 5, 1998.

--------

(Report dated December 16, 1997, addressed to the

Urban Environment and Development Committee from the

Commissioner of Transportation)

Purpose:

To award four contracts for general maintenance on major arterial roads.

Funding Source:

Funds have been provided in the Municipal Maintenance Management System Account within the 1998 Current Budget Estimates, and monies have been allocated within the Transportation Department's interim appropriation to accommodate these expenditures.

Recommendations:

It is recommended that the contracts for general maintenance on major arterial roads be awarded to the following tenderers who submitted the lowest price bids:



Contract No. Name $ Amount

T-6-98 Brennan Paving and Construction Ltd. 1,016,214.63

T-7-98 Pave-Al Limited and Orlando Corporation 952,468.53

T-21-98 Warren Bitulithic Limited 894,299.49

T-22-98 Brennan Paving and Construction Ltd. 1,002,436.15

Comments:

On December 4, 1997, the Metro Clerk's Department opened prequalified tenders in a "Lottery" type order for Contracts Nos. T-6-98, T-7-98, T-21-98, T-22-98. Procedures for the withdrawal of tenders, in accordance with Ministry of Transportation regulations for prequalified contracts, were applied at the opening. Specifically, at the conclusion of the reading out of bids on each contract and before the opening of tenders on the subsequent contracts, the low bidder on that contract has the opportunity of withdrawing its remaining tenders.

Tenders were opened in the following order:

Contract No. T-21-98 Roadway Maintenance on Metropolitan Roads - North District

No. Name $ Amount

5 Warren Bitulithic Limited 894,299.49

4 Pave-Al Limited and Orlando Corporation 927,907.32

9 Brennan Paving and Construction Limited 994,475.39

7 Ferpac Paving Inc., John Ferzoco Ltd., J. F. Paving Ltd. 1,042,479.60

1 Ferma Road Construction Ltd. 1,062,416.38

2 Pave-Tar Construction Ltd. 1,082,251.50

3 Gazzola Paving Limited 1,084,943.09

6 Sentinel Paving and Construction Limited 1,144,971.05

8 Crownwood Construction Ltd. 1,330,438.00

Contract No. T-6-98 Roadway Maintenance on Metropolitan Roads - South District

No. Name $ Amount

7 Brennan Paving and Construction Ltd. 1,016,214.63

1 Pave-Tar Construction Ltd. 1,042,582.86

2 Gazzola Paving Limited 1,145,492.03

5 Ferpac Paving Inc., John Ferzoco Limited, J. F. Paving Ltd. 1,200,006.07

6 Crownwood Construction 1,276,389.09

4 Sentinel Paving and Construction Limited 1,299,788.76

Tender No. 1 contained a minor error in the extension of the unit prices. The revised figure is shown above. Tender No. 3, submitted by Warren Bitulithic Limited, was withdrawn in accordance with procedures for the withdrawal of tenders.

Contract No. T-22-98 Roadway Maintenance on Metropolitan Roads - East District

No. Name $ Amount

7 Brennan Paving and Construction Ltd. 1,002,436.16

1 Pave-Tar Construction Ltd. 1,014,253.00

2 Gazzola Paving Limited 1,142,291.88

5 Ferpac Paving Inc., John Ferzoco Limited, J. F. Paving Ltd. 1,205,527.27

4 Sentinel Paving and Construction Limited 1,272,212.23

6 Crownwood Construction Ltd. 1,298,289.85

Tender No. 7 contained a minor error in the calculation of the Goods and Services Tax. The revised figure is shown above. Tender No. 3, submitted by Warren Bitulithic Limited, was withdrawn in accordance with procedures for the withdrawal of tenders.

Contract No. T-7-98 Roadway Maintenance on Metropolitan Roads - West District

No. Name $ Amount

4 Pave-Al Limited and Orlando Corporation 952,468.53

2 Pave-Tar Construction Ltd. 1,015,028.75

7 Ferpac Paving Inc., John Ferzoco Limited, J. F. Paving Ltd. 1,065,356.20

3 Gazzola Paving Ltd. 1,104,780.08

1 Ferma Road Construction Ltd. 1,125,854.00

8 Crownwood Construction Ltd. 1,203,001.00

6 Sentinel Paving and Construction Limited 1,209,817.17

Tender No. 2 contained a minor error in the calculation of the Goods and Services Tax. The revised figure is shown above. Tender No. 5 submitted by Warren Bitulithic Limited, was withdrawn in accordance with procedures for the withdrawal of tenders.

The awards are subject to receipt of a favourable report from the Fair Wage and Labour Trades Office regarding working conditions and wages of the recommended contractors and their sub-contractors, and also from the Chief Financial Officer regarding the surety companies who issued the Bid Bonds and Agreements to Bond.

Scope of Work:

The work in Contracts Nos. T-6-98, T-7-98, T-21-98 and T-22-98 includes crackfilling, grinding, paving, adjustment of maintenance hole covers and frames and catch basins, curb and gutter, and the construction of sidewalk accessibility ramps on various major arterial roads.

Conclusion:

Contracts Nos. T-6-98, T-7-98, T-21-98 and T-22-98 should be awarded to the low bidders.

Contact Name and Telephone Number:

Mr. C.J. Hebbard, Assistant Director, Road Operations , 392-8320.

--------

(Transmittal letter dated January 22, 1998, addressed to the

Budget Committee from the

Strategic Policies and Priorities Committee)

Action:

The Strategic Policies and Priorities Committee on January 19, 1998, referred the letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, to the Budget Committee for inclusion in the 1998 Capital Budget and a report back to the Strategic Policies and Priorities Committee meeting to be held prior to the Council Meeting to be held on February 4 and 5, 1998.

Background:

The Strategic Policies and Priorities Committee had before it a letter of transmittal from the Urban Environment and Development Committee, dated January 13, 1998, advising that the Urban Environment and Development Committee on January 12, 1998, recommended the adoption of the report (December 16, 1998) from the Commissioner of Transportation, respecting the award of four contracts Nos. T-6-98, T-7-98, T-21-98 and T-22-98 for general maintenance of "Metropolitan" roads.

--------

(Transmittal letter dated January 13, 1998, addressed to the

Strategic Policies and Priorities Committee from the

Urban Environment and Development Committee)

Recommendation:

The Urban Environment and Development Committee on January 12, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (December16,1997) from the Commissioner of Transportation respecting Contracts Nos.T-6-98, T-7-98, T-21-98 and T-22-98 for general maintenance of "Metropolitan" roads.

7

1998 Operating and Capital Budgets -

Schedule and Public Consultation Process

(City Council on February 4, 5 and 6, 1998, amended this Clause by:

(a) striking out the following recommendation embodied in the transmittal letter dated January28, 1998, from the Budget Committee:

"(2) the Chief Financial Officer and Treasurer be directed to invite the Budget Chair and/or his designate, other interested members of the Budget Committee and the Chairs of the Standing Committees and/or their designates to attend staff Budget reviews, to obtain necessary background information on the various departmental budgets."; and

(b) adding thereto the following:

"It is further recommended that a five-year planning process be continued with respect to the Capital Budgets for the former Metropolitan Toronto Agencies, Boards and Commissions.")

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January 28, 1998) from the Budget Committee, subject to including at the end of the listing for the week of March 2, the words "Phase 1 and Phase 2" so that the listing now reads as follows:

"Week of March 2 Committee of the Whole of City Council

- public meeting re Capital and Operating Budgets, Phase 1 and Phase 2".



The Strategic Policies and Priorities Committee submits the following transmittal letter (January 28, 1998) from the Budget Committee:

Recommendations:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee that:

(1) The following be the process and schedule for consideration and approval of the Capital and Operating Budgets:

February 3, 1998 Strategic Policies and Priorities Committee

(a) principles of budget

(b) budget process

(c) approve interim capital budget

February 4 Council approval of the above

February 9-19 Standing Committees and Community Council review Capital Budget and receive a copy of the Phase 1 of Operating Budget for information

February 17 Budget Committee approval Phase 1 (cut$150million)

February 24 Strategic Policies and Priorities Committee approval of Operating Budget, Phase 1

Week of March 2 Committee of the Whole of City Council

- public meeting re Capital and Operating Budgets

March 23 - April 2 Standing Committees and Community Council review Operating Budget and receive a copy of Phase 2 for information

March 31 Budget Committee finalize consolidated Operating and Capital Budgets

April 6 Strategic Policies and Priorities Committee receive and recommend approval of the Operating and Capital Budgets to Council

April 15 City Council approval of Operating and Capital Budgets; and

(2) the Chief Financial Officer and Treasurer be directed to invite the Budget Chair and/or his designate, other interested members of the Budget Committee and the Chairs of the Standing Committees and/or their designates to attend staff Budget reviews, to obtain necessary background information on the various departmental budgets.

Background:

The Budget Committee had before it a report (December 18, 1997) from the Chief Financial Officer and Treasurer respecting the proposed 1998 Operating Budget Process.





The Budget Committee also had before it the following:

(i) a report (December 23, 1997) from the Chief Financial Officer and Treasurer respecting the proposed 1998 Capital Budget Process; and

(ii) a report (January 23, 1998) from the Chief Financial Officer and Treasurer respecting a process for public consultation for the 1998 budget process.

Rhona Swarbrick, Etobicoke Citizens for Effective Government addressed the Committee.

--------

(Report dated December 18, 1997, from the

Chief Financial Officer and Treasurer,

entitled "Proposed 1998 Operating Budget")

Purpose:

To establish a process and timetable to adopt the 1998 operating budget.

Source of Funds:

N/A

Recommendation:

It is recommended that this report be received for information.

Discussion:

The preparation of the 1998 Operating Budget has been underway for several months. A significant work effort has been directed towards establishing common program and sub-program definitions as well as harmonizing various accounting and budgeting practices and policies.

Senior staff from the seven amalgamating municipalities have worked together in Service Review Teams in developing proposals for the 1998 consolidated operating budgets.

Preliminary budget pressures have been identified and a budget framework has been developed to address these pressures. Service Review Teams have been given preliminary reduction targets and have submitted their resulting budget estimates in varying degrees of completion in meeting those targets.

The receipt of the Transition Team budget report will kick-off the Budget Committee review process for the 1998 Operating Budget which will include: addressing City budget pressures; Provincial -downloading pressures; and funding one-time transition costs. The following process and timetable in Appendix A is presented for consideration to meet an April 15 Council approval.

Because of tight timelines in this unusual initial operating year, the 1998 budget process has been developed to address the current year's issues only, but with an identification of future years' issues wherever possible.

Public meetings to review the departmental budgets would be set up at a cluster level and would include the review of the budgets of the various agencies, boards and commissions. These meetings could occur in one location or at the locations of the various Community Councils.

Throughout 1998, the Standing Committees will consider policies and define the service levels that will form the basis of the 1999 Budget while the Strategic Policies and Priorities Committee in 1998 will consider financial policies that will be incorporated into 1999 and future years' operating budgets.

In May 1998, after budget approval, Council will be required to approve the adoption of a number of tax policies before tax rates can be established and final tax bills can be sent out. This will have to wait until after the final assessment roll is received from the Province in late April 1998. These policy decisions will focus around the following:

(1) whether to approve the establishment of a separate tax class for new multi-residential units;

(2) whether to establish "bands" or sub-classes of commercial properties, and if so, how many and at what levels;

(3) phase in periods for assessment increases and decreases;

(4) the nature of the tax relief for low income seniors and disabled (deferral/cancellation); and

(5) whether to shift tax burdens between tax classes i.e., Residential, multi-residential, commercial, industrial.

These decisions will be required before tax rates are approved by Council and before tax bills are sent out.



Appendix A

Proposed 1998 Operating Budget Process

Strategis Policies & Priorities Committee January 19 Adopt 1998 Operating Budget principles/direction.
Budget Committee January 26 Receive Strategic Policies & Priorities Committee 1998 Operating Budget direction.

Receive Transition Team budget report.

Staff presentation on budget pressures and work completed to date in meeting budget pressures.

Set Department, Agencies, Boards and Commissions budget targets and issue guidelines.

February 17 Departments, Agencies, Boards and Commissions present operating budgets that meet 1998 Operating Budget principles.
February 24, 25, 26 Budget Committee detailed review and analysis of Department, Agencies, Boards and Commissions budgets.
March 2, 3 or

March 23, 24, 25

Conduct public meetings
March 31 Finalize consolidated 1998 Operating Budget and forward to Strategic Policies & Priorities Committee.
Strategic Policies & Priorities Committee April 6 Receive and recommend 1998 Operating Budget. Forward to Council.
Council April 15

May 13

Adopt 1998 Operating Budget.

Adopt 1998 tax rates.

Note: Budget Committee will need to meet in February on a more frequent basis than currently scheduled.



(Report dated December 23, 1997 from the

Chief Financial Officer and Treasurer

entitled "Proposed 1998 Capital Budget Process)

Purpose:

To establish a process and timetable to adopt a 1998 Capital Budget.

Source of Funds:

N/A

Recommendation:

Receive as information.

Discussion:

The preparation of the 1998 Capital Budget has been underway for several months. A significant work effort has been directed to identifying and categorizing proposed capital projects as well as defining a level of capital expenditures that will not increase 1998 operating costs.

The proposed 1998 Capital Budget considers a two stage approval process -

(1) February 1998 approval of a 1998 Interim Capital Budget of critical projects/high priority emergency projects, projects which avoid significant liabilities for the City, projects with major savings and other critical projects. Transition costs where immediate investments are required to realize the savings in operations.

(2) April 1998 approval of the 1998 Final Capital Budget. New projects, existing projects requiring additional funding or with significant cashflow/scope change from prior years' programs as well as a status report on previously approved projects would be included in this Final Budget.

The process as presented addresses only the need for a capital budget for 1998. Subsequent to the passage of the 1998 Capital Budget, a five year Program needs to be adopted by Council later in 1998 to address Council's long term objectives for the City.

The following process and timetable is presented in Appendix A and B for consideration:

Appendix A

1998 Interim Capital Budget - Proposed Process

Strategic Policies & Priorities Committee

January 19

Establish overall preliminary 1998 Capital Budget Target
Council



February 4


Adopt 1998 Capital Budget target.
Budget Committee

January 26


Review critical projects that form 1998 Interim Capital Budget.

Review and recommend 1998 Interim Capital Budget.



Strategic Policies & Priorities Committee


February 3 *



Review and recommend 1998 Interim Capital Budget.


Council


February 4


Adopt 1998 Interim Capital Budget.
* Needs to be scheduled.

Appendix B

1998 Final Capital Budget - Proposed Process

Budget Committee January 26 Set preliminary target and guidelines for departments, agencies, boards and commissions.

Review and adopt project categorization and priority setting mechanisms.





February 17 *



Departments present 1998 Capital Budget requests.




Review consolidated service team/department final 1998 Capital Budget.




Refer relevant projects within defined targets to Community Councils for comment. Meet with Community Councils.




Refer relevant projects within defined targets to Standing Committees for comment.
Community Councils

February 18-20


Review projects included in 1998 Capital Budget with Budget Committee. Recommend adjustments, if any, to Budget Committee.
Standing Committee

March 23-30


Review projects included in 1998 Capital Budget. Recommend adjustments, if any, to Budget Committee.
Budget Committee

March 31


Review comments/ recommendations from Community Councils and Standing Committees. Recommend changes to 1998 Final Capital Budget.
Strategic Policies & Priorities Committee

April 6


Review and approve 1998 Final Capital Budget.
Council

April 15


Adopt 1998 Final Capital Budget.


* Budget Committee should set meeting date prior to February 17, 1998.



8

1998 Capital Works Program - Preliminary Targets and

Status Report on Outstanding Debt of the City of Toronto

(City Council on February 4, 5 and 6, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January28,1998) from the Budget Committee:

Recommendations:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee that:

(1) Recommendations Nos. (2), (5) and (6), embodied in the report (January 19, 1998) from the Chief Financial Officer and Treasurer, be adopted, subject to deleting Recommendation No.(2)(v), so that Recommendations Nos. (2), (5) and (6) now read as follows:

(2) that the interim Capital Management Guidelines as outlined in this report be used in the capital budget process:

(i) limit debt charges for tax supported programs to 10 percent of the municipal property tax levy;

(ii) the capital budget should include items with a useful life greater than the standard term of debenture borrowing - 10 years;

(iii) maintain capital from current funding at approximately $100 million with a view to increasing this level where possible;

(iv) fund capital maintenance and rehabilitation projects to the greatest extent possible from capital from current;

(v) explore alternative sources of capital financing, including the implementation of a City-wide development charges regime;

(5) that the Chief Financial Officer and Treasurer be directed to report on transitional projects and potential funding sources for transitional costs required to support the amalgamation process;

(6) that appropriate staff be requested to bring forward as soon as possible recommendations on appropriate road, bridge and facility maintenance standards and related longer term capital requirements;

(2) that the level of debt for capital budgets for future years be the subject of a further report from the Chief Financial Officer and Treasurer prior to the establishment of the five year capital plan; and

(3) that the Chief Administrative Officer be requested to report to the Budget Committee on his plan for asset rationalization and disposal of property in short, medium and long term, so that those capital dollars can be reinvested in the City's Capital Budget.

The Budget Committee reports having referred the following motion to the Strategic Policies and Priorities Committee and requested the Chief Financial Officer and Treasurer to report to that Committee on February 3, 1998, on which projects are affected and what the consequences would be if the motion were adopted:

"That any project for which prior approval has been given, but for which funding has not been provided and a contract has not been signed or issued, should not proceed until specifically approved by Council; and

That the Chief Financial Officer and Treasurer report to:

(i) the Budget Committee on all 1997 and 1998 unfunded Capital projects; and

(ii) the Strategic Policies and Priorities Committee on any projects that require immediate approval."

The Budget Committee also reports that it has deferred the following recommendations/motions until its next meeting on February 17, 1998, pending receipt of the above requested report from the Chief Financial Officer and Treasurer:

(1) Recommendations Nos. (1), (3) and (4) embodied in the report (January 19, 1998) from the Chief Financial Officer and Treasurer, as follows:

(1) that the 1998 gross capital budget target for property tax supported entities be set at $587 million, requiring estimated borrowing of $146 million;

(3) that the 1998 gross capital target allocations in Appendix A be adopted and used as a benchmark against which the capital requests are analyzed throughout the political review process; and

(4) that Standing Committees be directed to prioritize capital projects within the target allocations for consideration of the Budget Committee at its meeting on March 31, 1998, through to Council via the Strategic Policies and Priorities Committee.

(2) Motion by Councillor Jakobek:

"That the Capital Budget guidelines include:

(i) no further debentures/debt;

(ii) a maximum $300 million Toronto Transit Commission Capital (instead of $349 million), except for the Sheppard Subway; and

(iii) $275 million consolidated capital for other municipal areas (making a total of $575 million instead of $587 million)."

(3) Motion by Councillor Shiner:

"Whereas in 1997, seven municipalities approved capital works programs that used different sources of funding being operating, reserves, grants and debt; and

Whereas projects with previous approvals will require the use of debt in order to finance the projects completely; and

Whereas it is estimated that approximately $200 million will need to be borrowed in 1998 to cover these projects; and

Whereas the Chief Financial Officer and Treasurer has submitted a report on interim capital guidelines where debt is recommended as a source of financing the 1998 capital budget.

Therefore Be it resolved that only approved and started projects from prior years be funded from any new issue of debt in 1998; and

Be it further resolved that the level of debt to be used to finance the 1998 Capital Budget be $110 million (other than that required to complete the Sheppard Subway) - a no tax impact level of debt."

(4) Motion by Councillor Chow:

"That Recommendation No. (2)( v) embodied in the report (January 19, 1998) from the Chief Financial Officer and Treasurer, titled "1998 Capital Works Program - Preliminary Targets" be amended to read:

'(v) put the highest priority on capital maintenance and rehabilitation projects, including those showing extreme need, urgency, and timing necessity and phase in partnership applicability.'"

Background:

The Budget Committee had before it a report (January 19, 1998) from the Chief Financial Officer and Treasurer recommending preliminary targets for the 1998 Capital Works program to assist Council and its committees in reviewing the capital requests of the various program areas.

The Budget Committee also had before it a report (January 23, 1998) from the Chief Financial Officer and Treasurer providing the status of the outstanding debenture debt and related debt charges assumed by the City of Toronto as of January 1, 1998.

--------

(Report dated January 19, 1998, addressed to the

Budget Committee from the

Chief Financial Officer and Treasurer)

Purpose:

To set preliminary funding targets for the 1998 Capital Works Program to assist Council and its committees in reviewing the capital requests of the various program areas.

Financial Implications:

The recommended capital targets would result in a $1 million increase in debt charges in 1998 and $17 million in 1999 if the same level of capital targets were again set in 1999. These impacts are exclusive of possible additional transitional capital costs related to amalgamation which are in the process of being quantified and for which possible funding sources are being reviewed.

Recommendations:

It is recommended that:

(1) the 1998 gross capital budget target for property tax supported entities be set at $587 million, requiring estimated borrowing of $146 million;

(2) the interim Capital Management Guidelines as outlined in this report be used in the capital budget process:

(i) limit debt charges for tax supported programs to 10 percent of the municipal property tax levy;

(ii) the capital budget should include items with a useful life greater than the standard term of debenture borrowing - 10 years;

(iii) maintain capital from current funding at approximately $100 million with a view to increasing this level where possible;

(iv) fund capital maintenance and rehabilitation projects to the greatest extent possible from capital from current;

(v) put the highest priority on capital maintenance and rehabilitation projects; and

(vi) explore alternative sources of capital financing, including the implementation of a City-wide development charges regime.

(3) the 1998 gross capital target allocations in Appendix A be adopted and used as a benchmark against which the capital requests are analyzed throughout the political review process;

(4) standing committees be directed to prioritize capital projects within the target allocations for consideration of the Budget Committee at its meeting on March 31, 1998, through to Council via the Strategic Policies and Priorities Committee;

(5) the Chief Financial Officer and Treasurer be directed to report on transitional projects and potential funding sources for transitional costs required to support the amalgamation process; and

(6) appropriate staff be requested to bring forward as soon as possible recommendations on appropriate road, bridge and facility maintenance standards and related longer term capital requirements.

Council Reference:

Council, at its meeting of January 6, 1998, adopted a report dated December 23, 1997 from the Chief Financial Officer and Treasurer, entitled "Proposed 1998 Capital Budget Process", which outlined a review process for committee and Council review of the 1998 capital budget. Contained in that process was the establishment of preliminary 1998 capital budget targets by the Strategic Policies and Priorities Committee for presentation to Council in February, 1998.

Discussion:

The 1998 Preliminary Capital Request:

Each former municipality prepared preliminary capital project requests for 1998 to 2002. This report deals only with 1998 capital requirements. Post 1998 capital expenditures will be considered separately, given the need to develop longer term debt management policies and to evaluate in detail the capital needs of the new City.

Capital requests have been based on existing budgeting and financing policies which vary from municipality to municipality and, in general, these estimates have not been extensively reviewed by individual municipalities. The actual level of borrowing required may change from that shown in this report, once budgeting policies have been standardized. A large number of projects has been submitted which have not been considered or approved by previous Councils, mostly for rehabilitation and maintenance initiatives. Further, the capital requests do not yet include any transitional costs for the new City (which are being tabulated and reviewed), or capital cost requirements of Provincially downloaded functions such as social housing and GO transit. However, the capital requests provide a useful starting point for review by Council.



The expenditures, funding and borrowing for the consolidated preliminary capital request for property tax supported projects in 1998 is currently estimated as follows:

Requested Capital

Program ($Million)

Gross Expenditures 708

Funded by:

Provincial Grants (231)

Other External Revenue/Reserves (85)

Capital From Current and Other Internal (125)

Less: Potential Underspending (39)

Borrowing 228

The chart below details the impact on net debt outstanding of the requested 1998-2002 capital program.

Funding of Capital Works Program:

Gross capital expenditures are supported by various funding sources:

(1) Provincial and external funding. This is almost exclusively related to funding of capital projects of the Toronto Transit Commission. Under a five year subsidy agreement entered into between the Province and Metro in 1996, the Province agreed to phase in and maintain a 50 percent subsidy formula for the TTC's base capital program through to the year 2000, to a subsidy limit of $915 million, and a further $511 million for the Sheppard Subway. Since then, transit subsidies to other jurisdictions have been eliminated as part of the Provincial downloading process. The implication in 1998 is that some projects are now being funded at 50 percent compared with the traditional 75 percent level and this is causing upward pressure on the borrowing requirements of the City as it relates to the TTC. By 2001, the entire subsidy will be eliminated and the City will be faced with substantial increases to annual commitments to the TTC's capital maintenance and rehabilitation requirements;

(2) Internal sources - reserves and reserve funds, proceeds from property leases and sales, and other sources. To the extent that the City can secure additional revenues from sources such as development charges or third party agreements, higher capital expenditures can be incurred or debt issuance can be lowered;

(3) the level of "pay as you go" financing, commonly referred to as capital from current. Direct contributions to the capital program from the operating budget is an effective debt management tool which helps the City avoid future debt charges; and

(4) Debt.

The capital targets contained in this report are based entirely on the best estimates of existing funding sources.

Historical Context of Capital Program:

The pressures on the capital budget are to a large extent, a continuation of the trends which were identified in aggregate in prior approvals of capital programs unrelated to the amalgamation process. There are a few significant influences which have raised the 1998 capital requests above a level which would produce stability in borrowing which may have been possible two years ago:

(1) the reduction in Provincial subsidy to the TTC has added about $50 million to the 1998 budget in comparison with the traditional 75/25 cost sharing;

(2) the TTC's capital request advanced the purchase of replacement buses, totalling $44 million gross/ $22 million net into 1998. (Funding for this item is recommended to be deferred, as discussed below.) As well, additional cost estimates have been added to overhaul subway cars and for other priorities under the TTC's "State of Good Repair" program;

(3) the requested 1998 gross transportation capital budget request is about the same as historical levels, but the elimination of Provincial subsidies has increased the net expenditure request by almost $50 million. Approximately $17 million of this subsidy elimination has been recognized in the net expenditure levels associated with the recommended gross expenditure targets;

(4) solid waste management expenditures have risen by about $20 million over previous years, largely as a result of investments in recycling facilities;

(5) the capital program of the police has increased by approximately $20 million, mainly from investments in technology to improve the effectiveness and efficiency of officers' time; and

(6) parks and recreation expenditures have increased from historical levels.

As a benchmark, were the City to borrow, on average, $110 million per year to support future capital programs, then the total debt charges in the operating budget would stay more or less at the 1998 level. The capital budget pressures shown above mean that the capital requests would require borrowing of $228 million per year, more than double that level. Each of these components will be re-evaluated through the 1998 capital budget review process with a view to minimizing where possible, the borrowing impact of the various items.

Debt Management Considerations:

It is essential that the new City establish some preliminary debt management guidelines to assist in the 1998 capital budget priority setting process and to provide early indications to the credit rating agencies of the longer term financial policies and plans of the Corporation. The rating agencies have not yet established a credit rating for the new City, but ratings have a direct impact on the borrowing costs of the Corporation.

As an interim indicator, it is recommended that the City's 1998 capital program and resulting debt impact be monitored through the ratio of debt charges as a percentage of municipal property taxes and that the longer term level be set at a maximum of 10 percent. This is a valid, easily understood and simple measure which indicates the proportion of the property tax dollar which is dedicated to debt servicing versus that which is available for operating purposes. (The 1998 debt charges are7.5percent of property taxes, so the 10 percent level can be considered to be an upward limit to manage the City's capital expenditure and funding decisions over time).

Other indicators often used in respect of municipalities include debt charges (principal and interest payments) as percent of total revenues or own source revenues (e.g. property taxes plus user fees), debt as a percent of total reserve balances, or, as used by New York and Los Angeles, debt as a percent of the total assessed value of properties in the municipality, similar in concept to the debt equity indicator used in the private sector. Longer term financial policies are being developed and will be presented to Council as soon as possible.

By a number of measures, the new City is in sound financial condition. Rating agencies use a broad number of measures in establishing their ratings, but consistently gave Metro, previously as the borrowing source for the former seven municipalities and the school boards, good marks for relatively low debt levels, high reserves, and progressive pay as you go capital financing policies. Before amalgamation, Metro Toronto had the equivalent of a triple A credit rating from the two Canadian rating agencies, Canadian Bond Rating and Dominion Bond Rating. Two U.S. based agencies, Standard and Poor's and Moody's, downgraded the rating in 1996 from the former triple A level, due to the economic uncertainty in the Toronto area and possible downloading from the Provincial government.

In terms of the recommended interim debt measure, Toronto's debt charges as a percent of property taxes tend to be comparatively high in comparison with GTA regional governments:

Debt Charges as % of

Property Taxes (Net Levy)

Peel 0.1

Durham 0.3

York 3.0

Halton 6.7

Toronto 7.5

The regions of Peel and Durham have been successful at moving away from debt. However, it should be noted that, unlike Toronto, these areas have significant growth and therefore are currently able to fund their capital programs from development charges and assessment growth to a much larger extent. Further, no other municipality in the Province has the major capital infrastructure items which must be maintained by Toronto, such as the elevated Gardiner expressway, subway tunnels, tracks and cars, or streetcar tracks and cars. As well, the infrastructure in the surrounding regions tends to be younger and therefore generally less expensive to maintain.

Interim Capital Management Guidelines:

A more comprehensive debt management strategy will be presented to the Strategic Policies and Priorities Committee in the next quarter. Further analysis and policy development is being undertaken as well on the appropriate use of reserves, appropriate funding mechanisms for vehicle replacements and facility rehabilitation and maintenance, and development of a full 5 year capital works program. In the mean time, it is necessary to establish some interim capital management guidelines. These include:

(1) debt charges for property tax supported programs should not, over time, exceed 10 percent of municipal property tax revenues. Although there are no established standards which determine this to be the most appropriate level, this simply means that 90 percent of every tax dollar raised is available for operating purposes. As well, this amount is in keeping with Toronto as a mature municipality with limited potential for significant assessment and revenue growth, particularly in comparison with other large Ontario municipalities. The former City of Toronto used 10 percent as a guideline. Metro's guideline was 15 percent, however, based on the additional tax base from Provincial downloading, and adjusted to eliminate the self-supporting water pollution control operation from the calculation, the effective ratio was also very close to 10 percent;

(2) the capital budget should only include items which have a useful life greater than the standard term of debenture borrowing, 10 years. For example, vehicle and replacement microcomputer related expenditures should be funded from reserves or the operating budget;

(3) the existing consolidated capital from current level of approximately $100 million should be maintained as a minimum, to reduce future borrowing, particularly for ongoing maintenance requirements. One way to mitigate the long term fiscal consequences of increased debt is to use direct contributions from the operating budget for capital funding (capital from current) to a greater extent. A phased increase of capital from current funding as a permanent addition to the property tax base is advisable over the next five years if long run operating impacts associated with new capital funding responsibilities for transit and roads are to be minimized. Options will be presented to Council as part of a strategy for longer term financing strategies. While no increase to capital from current has been included in the operating budget for 1998, every attempt should be made to increase this amount in future years;

(4) Capital projects of a rehabilitation or maintenance nature (i.e. expenditures which return an asset in its original state of repair and service level) should be funded to the extent possible from capital from current. Full funding of these items through capital from current is not achievable in 1998. Other initiatives should be funded through debt, for example, service enhancements and expansion. As a rule, new projects have a longer useful life than rehabilitation and it is therefore advisable in the longer term to minimize the use of debt to finance ongoing rehabilitation and maintenance;



(5) Capital projects of a rehabilitation or maintenance nature should be considered the highest priority. Projects with significant health and safety considerations, those with legislated requirements or those which will produce sustainable operating savings, should also be considered to be of high priority. Because of the constraints facing the capital and operating budgets, new initiatives should generally be required to produce demonstrable ongoing operating efficiencies and savings; and

(6) the City should examine alternative funding sources for the capital program. Two such sources which could play a prominent role in funding capital include the use of development charges and user fees. A report detailing the merits of these sources of funding will be presented to Council, for its consideration, in the next few months.

Benchmark Capital Borrowing Level:

To assist Council in its review of the 1998 capital requests from the various departments, five capital expenditure and borrowing options have been identified and analyzed for property tax supported operations. Rate supported capital expenditures, such as those for self-supporting water and sewer operations, are excluded as these do not impact the property tax base. Further, the Rapid Transit Expansion Program (RTEP), i.e. Sheppard Subway and Wilson Yard Expansion, has been excluded from the benchmark calculation since debt charges for these programs are currently funded from the reserve established for that purpose through annual contributions of about $12 million in the operating budget.

Option (1) A status quo borrowing level - Maintain debt charges at the current 7.5 percent of property taxes by financing $110 million in capital expenditures annually through borrowing. In 1998, this would support gross expenditures of about $560 million. This would, on average over a number of years, result in no increase in the operating budget due to higher debt charges and would maintain the debt charges, on average, at the current level of $190 million (exclusive of $12 million funded from the RTEP reserve).

Option (2) Recommended 1998 target level - The individual targets recommended in this report would require borrowing in 1998 of $146 million. At this level of borrowing in both 1998 and 1999, the operating budget would rise by $1 million in 1998 and by a further $17 million in 1999. The 1998 gross expenditures associated with this target is $587 million.

Option (3) Higher borrowing level. - Constrain debt charges at 10 percent of the property taxes. This would result in operating budget pressures of $7 million annually on average over a 10 year period to fund higher debt charges. This scenario would allow the City to borrow $160 million annually and would support, in 1998, a gross budget of approximately $620 million.

Option (4) Lower borrowing level - (Reduce over time the debt charge over taxes ratio to, say, 5 percent). Significant reductions to the capital program, or the implementation of alternative funding sources which would avoid debt would have to be introduced. Under this scenario, the City would have to reduce its annual borrowing to, on average, $60 million through a long term debt reduction strategy. This level of borrowing would support a 1998 gross budget of approximately $500 million. To adequately fund infrastructure maintenance requirements at this level of borrowing would require significant funding changes through, for example, higher levels of reserve contributions, dedicated user fees, and/or capital from current increases. These and other options will be evaluated as part of a comprehensive review of capital financing policies.

Option (5) 1998 capital requests - The consolidated requests for tax supported programs have a 1998 gross capital expenditure level of $708 million, with borrowing projected at $228 million. Were this level of borrowing to occur in 1998 and future years, the debt charges over property tax ratio would rise from the current level of 7.5 percent to over the 10 percent guideline by 2003 and to almost 13 percent within 10 years. This would translate into annual average operating budget increases of $15 million due to higher debt charges.

Given the constraints currently being placed on the operating budget, Option 1) would be preferable in the long term. However, the capital funding pressures as outlined in this report have resulted in recommended 1998 targets above this level and therefore, Option 2) is recommended. Approving capital expenditures above this level would mean higher debt charges or an increase in capital from current, where either one increases the operating budget for capital financing.

The borrowing scenarios identified above would result in the following total debt charge impacts on the 1998 operating budgets, in comparison with the requests:

Change in Operating Budget

Due to Debt Charges ($Million)

1998 1999

Annual Borrowing:

$60 Million: (2) 4

$110 Million: 0 11

$146 Million (Recommended) 1 17

$160 Million: 2 19

$228 Million (Requests) 4 33





Recommended 1998 Targets for Programs:

An allocation of capital expenditure targets for programs has been made as a starting point to assist Council and its committees in the review of the capital requests. These have been based on an analysis of the historical level of capital expenditures for each function in the seven municipalities, funding committed to projects approved by previous Councils, and a preliminary review of the requested capital program consolidation of the former seven municipalities. The following strategies have been taken into consideration in setting the targets:

(1) there may be opportunities for infrastructure rationalization made possible by the amalgamation. On this basis, facility related expenditures may be reduced through the disposal of surplus properties which might otherwise have had to be maintained. Information technology and communications related expenditures may benefit from a more corporate approach, rather than specific directions determined by each department or agency. Further, vehicle purchases can be re-examined to determine the longer term strategies for funding these items through the operating budget and reserves; and

(2) priority should be placed on rehabilitation and maintenance projects, or those which will enhance health and safety or result in future operating budget savings. As such, new initiatives which would increase future operating budgets would be generally considered as a lower priority.

The recommended targets are shown in Appendix A. They would result in a borrowing level of $146 million. While this is in excess of a "no tax impact" level of $110 million, there are a number of issues and commitments as described in more detail below, which would make it difficult for the City to reduce its borrowing requirements to that level in 1998, as described below.

Target Rationale:

Toronto Transit Commission:

The TTC's capital program is by far the largest component of the City's capital requests. Expenditures relating to the construction of the Sheppard Subway and Wilson Yard have been isolated from the property tax supported targets, since the debt charges for the next two years for these RTEP projects can be completely funded from the dedicated tax and reserve established for that purpose in 1996. As originally projected, by the year 2000, RTEP debt charges will have an impact on the operating budget.

The majority of the balance of the TTC's program is for "state of good repair", or maintenance and rehabilitation items, including the replacement of subway and surface vehicles. Because of the Provincial funding agreement described earlier, some projects will be funded in 1998 at 25 percent City and 75 percent Provincial, while other projects will be at a 50/50 ratio. Any arbitrary reduction to the balance of the program would result in a simple deferral which could mean that the City would be forced to pay 100 percent for items in the future which could be completed for a 25 to 50 percent City share if done now. The following adjustments have been made to the TTC target:

(1) half of the funding for replacement buses ($22 million gross/$11 million net) has been deferred based on indications that the buses may not be purchased in 1998; and

(2) the new Queens Quay LRT extension has been treated as a new item and $7 million gross in funding has therefore been deferred, consistent with the target treatment of other programs. This item can still be considered, should Council determine it to be of a high priority.

Transportation:

The second largest tax supported component of the program is for road resurfacing, bridge and road reconstruction, and various other road related projects. The target has been established at a gross level of $100 million, or approximately $30 million below the historical budgeted level of expenditure. An inventory of the state of repair of arterial and local roads must be completed and road maintenance standards need to be developed to determine the longer term capital requirements. It is recommended that the appropriate staff bring forward recommendations as soon as possible in this regard. In the mean time, since the majority of the requested capital program is for maintenance and rehabilitation, it is recommended that funding be maintained for these works. To arbitrarily stop such work would in all likelihood mean the continued deterioration of roads, bridges and expressways which are known to increase the longer term costs.

Solid Waste:

The majority of solid waste projects have received previous Council approval and therefore, only a minor overall reduction has been indicated.

Police:

The Police request includes a number of new automation projects which are designed to increase the operating efficiency of the service and replace outdated equipment. The recommended target will provide for the majority of the requested works and will allow the City to evaluate the required funding for communication upgrades in the context of the overall emergency requirements of police, fire and ambulance, as well as corporate wide financial system requirements.

Fire and Ambulance:

Pending consolidated facilities and vehicle requirements studies, and based on the premise that vehicles such as pumpers should be funded from reserves or the operating budget, the fire and ambulance targets have been set at a level of $1 million each.

Parks and Recreation:

A sizeable portion of the Parks and Recreation capital program relates to facility upgrades such as swimming pool rehabilitation and upgrades, and various new facilities. The target has been set at approximately the historical level of $20 million. Within the constrained capital program, as indicated in the guidelines described earlier, emphasis should be placed on rehabilitation and maintenance and new facilities should be generally considered as a lower priority.

Community Services:

The bulk of the request for Community Services is for completion of renovations to the Cummer Lodge home for the aged and the Seaton House hostel. No adjustment has been suggested.

Library:

At this point, funding for library expansion and rehabilitation has been set at $3 million, pending complete facility requirement and condition studies.

Zoo, Conservation and Exhibition:

The requests for these items have not been adjusted. The funding levels for the Conservation Authority and Exhibition Place have been at about the same level for a number of years and this level represents the ongoing maintenance and rehabilitation levels. The normal annual level for the Zoo is approximately $4 million to $5 million but, because certain works were completed in 1997, the 1998 request is lower than usual, about $2 million.

Historical Board:

Funding has been set at $1 million, pending an analysis of the longer term requirements.

Facilities:

A significant reduction to the facilities funding level is recommended, pending a comprehensive analysis of facility needs, state of repair and capital requirements. However, it is acknowledged that there will be a requirement for some level of facility rehabilitation and maintenance funding in the future. It is therefore recommended that the appropriate staff bring forward recommendations on the City's long term capital facilities maintenance requirements.

It should be noted that other facility upgrade costs are shown in other areas, for example, Parks and Recreation, Libraries, etc.

Corporate:

This account includes funding for the capitalization of temporary borrowing costs associated with all tax supported capital expenditures. No adjustment has been made, but this item will be the subject of further analysis and capital management policy development discussed earlier.

Transitional Costs

The transition to a new City requires certain one time investments. The actual investment will vary with the decisions of Council (specifically, the location of the various service centres and the structure of service areas). Very preliminary estimates indicate that 1998 transition costs could range between $100 million and $175 million. These expenditures consist of computer technology (required to accomplish the efficiencies associated with the identified savings), accommodation, relocation and retrofitting costs, and human resource costs.

The exact funding mechanisms for the transition costs are being assessed. Possible methods include:

(1) application of the $50 million grant which will be available from the Province (amount to be determined when terms and conditions are clarified); and

(2) the use of available non-restricted reserve funding. Reserves are being reviewed and further information and recommendations will be presented to Council.

It is recommended that the Chief Financial Officer and Treasurer be directed to report on potential funding sources for transitional costs required to support the amalgamation process.

Rate Supported:

Although the capital expenditures of the rate supported programs do not impact the property tax base, it is important to carefully manage these expenditures to limit future rate increases. The targets for the sewer and water programs, parking and economic development have been based on the same approach as that taken for property tax supported programs. The target for the Sheppard Subway and Wilson Yard, both RTEP projects, have not been adjusted, since these are fully approved works in progress funded under the five year subsidy agreement with the Province. For 1998 and 1999, the debt charges of these projects will be fully funded from the reserve established for that purpose in 1996.

1999 and Future Pressures:

Future capital budgets will be under further pressure as a result of factors such as:

(1) the expiry of a five year Provincial funding agreement by the year 2001 will mean an ongoing additional net capital requirement for the TTC of some $110 million annually above the requested 1998 level and $180 million above a more typical year's budget. About $50 million of the subsidy loss was reflected in the 1998 request and the 1998 request was a further $20 million net higher than a typical year due to the cash flow timing of projects, for example bus purchases;

(2) the aging of capital infrastructure, particularly transit and roads. As major capital expansion of the 1950's and 1960's ages, the capital maintenance and replacement costs increase. A prime example is the Humber bridges replacement project for the Gardiner Expressway and Lakeshore Blvd., which, under the revised accelerated plan included in the requested budget, is expected to have a net expenditure averaging about $15 million annually over the next five years. Also, Provincial grant reductions and expenditure restraint of the early 1990's has led to an increasing backlog in capital road work, facilities, and other infrastructure;

(3) additional/potentially sizeable capital expenditures have not yet been quantified. For example, the cost of a replacement landfill site, should Council opt to construct its own site following the closure of the Keele Valley landfill site, could be in the hundreds of millions of dollars. Further, financial responsibilities associated with GO Transit and social housing could increase future costs significantly; and

(4) possible further pressures from equalization of certain service levels across the new City.

The majority of these cost pressures reflect permanent changes to the annual capital needs of the new city. They cannot be deferred or eliminated, and to the extent that they must be funded by the municipality, debt is the most expensive financing tool in the long run.

Conclusion:

Capital expenditures in 1998 will not be a significant source of pressure or savings for the 1998 operating budget. Their impact will largely be felt in 1999 and thereafter. To assist Council in its review of the capital requests, targets have been prepared to serve as a benchmark against which the requests can be compared. Reviews by the standing and budget committees should provide further information to allow Council to approve a detailed 1998 capital works program by April 1998. Further work is underway in the mean time toward establishing longer term capital management strategies, policies and guidelines. The funding of transitional costs due to amalgamation will be brought forward for the consideration of Council as soon as possible.

Contact Names:

Len Brittain, 392-5380

Donald Altman, 392-1529

Ross Cuthbert, 396-7241

--------

Appendix A

RECOMMENDED 1998 CAPITAL TARGETS ($MILLION)

Historic Request Target

Gross Net Req.ts* Gross Net Req.ts* Gross Net Req.ts*

TAX SUPPORTED

Urban Environment & Development

TTC Excl. Sheppard Subway (RTEP) 190 46 378 129 349 114

Transportation 131 69 129 118 100 90

Exhibition Place 6 4 8 4 8 4

Zoo 5 5 7 2 7 2

Conservation Authority 4 4 4 4 4 4

Sub-Total 336 128 526 257 468 214

Works and Utilities Solid Waste 13 6 32 29 31 28

Emergency and Protective Services

Police 18 18 37 37 31 31

Fire 2 1 5 1 1 1

Ambulance 4 4 2 2 1 1

Sub-Total 24 23 44 40 33 33

Community and Neighbourhood Services

Parks and Recreation 22 19 55 27 20 20

Community Services 14 6 23 11 23 11

Library 7 5 5 4 3 1

Historical Board 1 1 1 1 1 1

Sub-Total 44 31 84 43 47 33

Corporate Services

Facilities Management 12 11 19 16 5 4

Corporate 21 20 3 3 3 3

Sub-Total 33 31 22 19 8 7

Total 450 219 708 388 587 315

Less: Potential Underspending or Cash Flow Deferrals (39) (48)

Less: Capital from Current and Other Internal Funding (121) (121)

Projected Borrowing Requirements 228 146

TRANSITIONAL COSTS

Various Items N/A N/A 100-175 100-175

Provincial Grant (50)? (50)?

RATE SUPPORTED AND OTHER

Sheppard Subway, Other R.T.E.P. 53 13 177 44 177 44

Water Pollution/Water Supply 95 52 155 19 155 19

Economic Development 4 3 13 0 13 0

Parking 12 12 11 0 11 0

Harbour Commission 1 1 1 0 1 0

Total 165 81 357 63 357 63

GRAND TOTAL (Excluding Transitional Costs) 615 300 1,065 451 944 378

* Net Requirements is Gross Expenditures, less Provincial Grants, Other External Revenues and Reserve Funding. It represents the amount that must be raised from capital from current, other internal sources, and borrowing.

--------

(Report dated January 23, 1998, addressed to the

Budget Committee from the

Chief Financial Officer and Treasurer)

Purpose:

This report provides the status of the outstanding debenture debt and related debt charges assumed by the City of Toronto as of January 1, 1998.

Recommendations:

It is recommended that this report be received for information.

Background:

Section 107(1) of Bill 148, an Act to deal with matters relating to the establishment of the new City of Toronto, states that "the city stands in the place of Metro with respect to debentures issued by Metro on which the principal remains unpaid on December 31, 1997; the city is also responsible for payment of any related debt charges payable on or after January 1, 1998". This report presents outstanding debt and related debt charges which are being assumed by the new City of Toronto for the former Metropolitan Toronto and the area municipalities.

Comments:

Municipalities utilize debentures and other debt instruments as a means to finance long-lasting improvements and rehabilitation requirements to its infrastructure and properties. Debt financing accomplishes two major goals as they enable the municipality to finance, in conjunction with other sources, required capital expenditures without placing an undue burden upon the current operating budget and spreading the cost of projects over their useful economic life, thereby enhancing their affordability by allocating a portion of these costs to future beneficiaries. When making decisions about debt issuance, the municipality must consider both the total amount of debt that can be incurred and the affordability of the annual debt service (principal, sinking fund deposit and interest) as well as current market conditions.

Capital Market Activity During 1997:

During 1997, Metropolitan Toronto issued $205 million of sinking fund debentures in the domestic market, with $200 million being syndicated in the public market and $5 million being placed with the Metropolitan Toronto Sinking Fund on a private placement basis. Both issues received excellent receptions in the market. The first debenture issue of $105 million has an interest rate coupon of 6.10 percent with a 10 year maturity due August 15, 2007. The second debenture was also issued with a coupon of 6.10 percent with a 20 year maturity due December 12, 2017. Of these amounts, $75.8 million was issued on behalf of the Metropolitan Toronto School Board, $71 million for Metropolitan Toronto purposes, $25.3 million on behalf of Toronto Hydro, $24.2 million for the Sheppard Subway and $8.7 million for an area municipality.

On an historical basis, it is interesting to note that the last Metro debenture having an interest rate of 6 percent was issued in March, 1967.

Debt Structure:

Municipal debt in Ontario, including the City of Toronto, is generally issued as instalment or sinking fund debentures, since there is a requirement that a portion of the principal must be repaid on an annual basis, either in the form of a payment to the investor or the sinking fund. Upon the issuance of instalment debentures, incremental principal payments become due on an annual basis until the entire issue has been retired. Sinking fund debentures specify a specific sum which shall be levied on an annual basis which, together with the interest earning on these sums, will be sufficient to repay the principal of the debentures at maturity. Due to recent capital market conditions, an earnings rate of 5 percent has been adopted as a more conservative interest assumption than the previous rate of 6 percent used during 1996.

Debenture Terms:

In the past, Metro has generally issued debt with a maturity of 10 years for capital expenditures for projects pertaining to the maintenance or renovation of existing infrastructure and for a 20 year maturity for growth-related projects with a longer useful economic life such as the Trade Centre and the Sheppard Subway. This policy has provided an effective means of ensuring that debt is maturing on a regular basis and providing a portion of the capacity for fulfilling new issuance requirements without creating a debt burden that will not provide any maturities for a 20 year term.

--------

Gross Debt Outstanding

($Millions)

1998 1999 2000 2001 2002 2003-17
Metro
General 817.0 754.6 746.9 659.1 589.4 438.8
Water Pollution Control 194.0 174.3 155.6 119.1 72.6 26.4
Water Supply 18.1 17.5 7.4 7.4 4.1 0.0
Metro Sub-Total 1,030.0 946.4 909.9 785.6 666.1 465.2
Area Municipalities
East York 14.7 7.7 1.5 1.0 1.0 0.0
Etobicoke 79.2 64.6 56.1 44.0 42.9 27.8
North York 34.2 21.6 14.8 13.9 8.0 0.0
Scarborough 0.9 0.2 0.1 0.1 0.0 0.0
Toronto 132.1 71.5 53.6 0.0 0.0 0.0
York 28.1 22.6 20.9 10.4 9.9 7.8
Area Sub-Total 289.2 188.2 147.0 69.4 61.8 35.6
City of Toronto Total 1,318.9 1,134.6 1,056.9 855.0 727.9 500.8
Etobicoke Hydro 20.0 0.0 0.0 0.0 0.0 0.0
Toronto Hydro 81.5 78.6 75.4 72.1 68.4 64.5
Municipal Hydro Total 102.0 78.6 75.4 72.1 68.4 64.5
Toronto District School Board



245.0
244.0 243.1 243.1 243.1 243.1
Total Debt Outstanding 1,666.0 1,457.2 1,375.4 1,170.2 1,039.0 808.4
City's Annual Maturities 26.1 184.3 77.7 201.9 127.1 227.1


Based upon current and forecasted long-term interest rates and a sinking fund earnings assumption of 5 percent, the City could issue an average of $110 million debentures annually for the next 5 years with a 10 year maturity which would replace the maturing debt and not increase debt charges over current levels.

Projected Net Debt Outstanding*

($Millions)

1998 1999 2000 2001 2002 2003-17
Metro
General 547.4 392.4 328.6 263.6 235.8 175.5
Water Pollution Control 130.0 90.6 68.5 47.6 29.0 10.6
Water Supply 12.3 9.1 3.3 3.0 1.6 0.0
Metro Sub-Total 689.7 492.1 400.4 314.2 266.4 186.1
Area Municipalities
East York 6.0 3.6 0.6 0.5 0.5 0.0
Etobicoke 53.1 30.4 23.6 23.3 19.3 12.5
North York 22.8 10.2 6.2 5.6 3.6 0.0
Scarborough 0.4 0.1 0.0 0.0 0.0 0.0
Toronto 88.5 33.6 22.5 0.0 0.0 0.0
York 18.8 10.6 8.8 4.4 4.0 3.1
Area Sub-Total 189.6 88.5 61.7 33.8 27.3 15.6
City of Toronto Total 879.3 580.6 462.1 348.1 293.8 201.7
Etobicoke Hydro 13.4 0.0 0.0 0.0 0.0 0.0
Toronto Hydro 54.6 29.9 24.9 21.6 19.2 18.1
Municipal Hydro Total 68.0 29.9 24.9 21.6 19.2 18.1
Toronto District School Board



209.7
114.7 107.0 97.2 87.5 72.9
Total Net Debt Outstanding 1,157.0 725.1 593.9 466.9 400.4 292.7
* Net debt is based upon projected sinking fund balances.


Due to the operation of the sinking fund having total assets of approximately $550 million which have been set aside to retire maturing debt in the future, it is important to consider the net debt position of the City since it is one of the indicators which is monitored by the credit rating agencies. For 1998, gross outstanding debt is $1,318.9 million and projected net debt is $879.3 million.

Of the outstanding City's gross debt, approximately 35 percent or approximately $460 million as at December 31, 1998 has been issued for growth-related projects such as the Trade Centre at Exhibition Place, RTEP (Sheppard Subway), the Spadina LRT, Metro Hall and various systems such as the Police Information System (METROPOLIS) and Community Services' Caseload Management System. The remaining 65 percent or $860 million has been issued for maintenance and rehabilitation projects such as major road and bridge reconstruction and the TTC "state of good repair" program.

--------

Projected Debt Charges re: Outstanding Debt

($Millions)

1998 1999 2000 2001 2002 2003-17
Metro
General 124.7 124.6 112.1 108.9 95.7 394.3
Water Pollution Control 34.6 33.8 29.2 23.8 19.1 18.5
Water Supply 3.8 3.8 3.1 1.2 1.2 0.7
Metro Sub-Total 163.1 162.2 144.4 133.9 116.0 413.5
Area Municipalities
East York 2.9 2.6 2.6 1.4 0.3 0.5
Etobicoke 13.1 13.1 10.8 9.4 7.5 20.5
North York 6.4 6.0 6.0 3.8 2.5 3.9
Scarborough 0.7 0.3 0.2 0.1 0.1 0.1
Toronto 41.0 22.5 12.4 7.6 0.0 0.0
York 5.3 4.8 3.9 3.4 1.9 3.7
Area Sub-Total 69.4 49.3 35.9 25.7 12.3 28.7
City of Toronto Total 232.5 211.5 180.3 159.6 128.3 442.2
Etobicoke Hydro 3.3 3.3 0.0 0.0 0.0 0.0
Toronto Hydro 13.1 13.1 13.1 13.1 13.1 56.0
Municipal Hydro Total 16.4 16.4 13.1 13.1 13.1 56.0
Toronto District School Board



35.2
34.2 33.8 32.9 32.9 178.7
Total Debt Charges 284.1 262.1 227.2 205.6 174.3 676.9


It should be noted that approximately 60 percent of the above debt charges represent principal repayment to the sinking fund and 40 percent is paid as an interest expense. For 1998, approximately $140 million represents principal payments and $92.5 million represents interest expense.

Conclusion:

This report presents the status of the outstanding debt as assumed by the City of Toronto as of January 1, 1998. The capacity to issue additional debt in the future for the financing of capital expenditures is related to our current position and will be further addressed during the operating and capital budget process in a report recommending debt management guidelines for the City.

Contact Name:

Martin Willschick, Manager Capital Finance

Phone: 392-8072

Fax: 392-3649

E-mail: Willschick, Martin W



9

Financial Relationships with the

Toronto District School Boards

(City Council on February 4, 5 and 6, 1998, amended this Clause by:

(a) deleting from Recommendations Nos. (1) and (2) embodied in the transmittal letter dated January 28, 1998, from the Budget Committee, the references to the date "June 1, 1998" and inserting in lieu thereof "August 31, 1998", so that such recommendations shall now read as follows:

"(1) that the effective date of the change to quarterly payments be August 31, 1998, and that the former financing arrangements in effect in 1997 continue until that time without prejudice to the City of Toronto;

(2) that City and School Board officials present an agreement before August 31, 1998, that addresses the City use of daycare and school facilities for parks and recreation purposes into a new master agreement between the City and the School Boards;"; and

(b) adding thereto the following:

"It is further recommended that Council appoint a delegation composed of Councillors Bussin, Jakobek, McConnell, Walker and any other interested Councillors, to meet with officials of the Ministry of Education and Training with respect to education costs that are no longer covered by Provincial funding.")

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January28,1998) from the Budget Committee:

Recommendations:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee that Recommendations Nos. (1) and (2) embodied in the report (January 15, 1998) from the Chief Financial Officer and Treasurer be struck out and the following be inserted in lieu thereof, so that the recommendations in the report now read:

(1) that the effective date of the change to quarterly payments be June 1, 1998, and that the former financing arrangements in effect in 1997 continue until that time without prejudice to the City of Toronto;

(2) that City and School Board officials present an agreement before June 1, 1998, that addresses the City use of daycare and school facilities for parks and recreation purposes into a new master agreement between the City and the School Boards;

(3) that City staff continue to work with the school boards to reach a mutually satisfactory arrangement regarding City use of school facilities for consideration in the 1998 operating budget; and

(4) that the appropriate City Officials be authorized and directed to take the necessary action to give effect thereto.

The Budget Committee reports having requested:

(i) the Chief Financial Officer and Treasurer to report back to the Budget Committee prior to June 1, 1998, on the status of this matter so that the Committee may determine whether or not the former financing arrangements should continue beyond June 1, 1998; and

(ii) the Acting Executive Commissioner of Community and Neighbourhood Services to report on shared service opportunities between the City and the School Boards.

Background:

The Budget Committee had before it a report (January 15, 1998) from the Chief Financial Officer and Treasurer recommending a policy concerning the timing of payment of taxes collected for education purposes to the Toronto District School Board and Toronto Catholic District School Board, and to outline further anticipated changes in the financial relationship with the Toronto School Boards.



The Budget Committee also had before it the following:

(i) a communication (January 26, 1998) from Mr. Joseph Martino, Chair, Toronto Catholic District School Board;

(ii) a communication (January 23, 1998) from Ms. Gail Nyberg, Chair, Toronto District School Board; and

(iii) a further report (January 22, 1998) from the Chief Financial Officer and Treasurer, responding to recommendations adopted by City Council at its meeting on January 2, 6, 8 and 9, 1998, and providing additional information regarding the financial relationship between the City and the Toronto School Boards.

The following addressed the Committee:

- Mr. Joseph Martino, Chair, Toronto Catholic District School Board; and

- Ms. Gail Nyberg, Chair, Toronto District School Board.

--------

(Report dated January 15, 1998, addressed to the Budget Committee

from the Chief Financial Officer and Treasurer)

Purpose:

To recommend a policy concerning the timing of payments of taxes collected for education purposes to the Toronto District School Board and Toronto Catholic District School Board, and to outline further anticipated changes in the financial relationship with the Toronto District School Boards.

Source of Funds:

The recommended policy of making quarterly instalments of education taxes to the Toronto District School Board and Toronto Catholic District School Board, as permitted by legislation, rather than in accordance with previous policies will increase 1998 budgeted investment income by approximately $13.9 million.

Recommendations:

It is recommended that:

(1) taxes collected by the City for education purposes be paid to the Toronto District School Board and Toronto Catholic District School Board in quarterly instalments in accordance with the provisions of Section 257.11 of Bill 160 (an Act to reform the education system);

(2) the City lend funds to either School Board, on their request, at an interest rate that approximates the City's cost to borrow similar amounts for a similar period of time;

(3) City staff continue to work with the School Boards to reach a mutually satisfactory arrangement regarding City use of school facilities for consideration in the 1998 operating budget; and

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

Council Reference/Background/History:

Bill 160, the Act to reform the education system, received Royal Assent on December 8, 1997. Certain sections of the Act have a significant impact on the City's financial relationship with the Toronto District School Board, formerly known as the Metropolitan Toronto District School Board and the Toronto Catholic District School Board, formerly known as the Metropolitan Separate School Board. Specifically, Sections 154 and 160 of the Act repeal The Metropolitan Separate School Board Act, 1953 and Part VIII of the Municipality of Metropolitan Toronto Act, respectively. These pieces of legislation, rather than the Municipal Act, formed the basis of the Area Municipalities and Metro advancing to the school boards the portion of the tax levy raised for education purposes.

Section 257.11 of Bill 160 requires municipalities to pay amounts levied for school purposes, public and separate, in quarterly instalments on March 31, June 30, September 30 and December 15. This is the same schedule of payment dates currently used by the majority of municipalities to pay school boards their portion of the levy, based on interpretation of the Municipal Act. This section of Bill 160 also allows a municipality, with the consent of the school board, to pay in advance of these dates and allows the municipality to discount these payments at the prevailing prime rate of interest. However, Section 257.11 also allows a school board, with agreement with a majority of the municipalities in its area jurisdiction, to vary the number of instalments and their amounts and dates.

The following outlines previous policy with respect to tax levy collection and payments:

Formerly, the Area Municipalities collected the education portion of the tax levy at the same time that they collected taxes for their own purposes and for the Municipality of Metropolitan Toronto. The separate school board's portion was remitted to the board monthly by each of the Area Municipalities although the dates were not consistent among the municipalities. Three municipalities paid the separate school board on the last business day of each month, two municipalities on the 15th of each month and one municipality on the first business day of each month. The basis for these monthly payments was Section 16(2) of the Metropolitan Separate School Board Act 1953 which stated "money payable to the Metropolitan Board shall as far as possible be paid in monthly installments or from time to time as the Metropolitan Board shall require."

On the other hand, the Area Municipalities remitted the public school board's and Metro's portion of the levy to Metro, ten business days after each of the Area Municipalities' levy dates. The basis for this policy was an agreement reached between the Area Municipalities and Metro in 1989 and ratified by Metro Council at its meeting on May 24, 1989. Metro retained and managed the public school board's portion and credited the public school board with interest on these funds from the day Metro received the funds from the Area Municipalities. The basis for this policy was an administrative arrangement between Metro and the public school board, as the Municipality of Metropolitan Toronto Act did not specify the timing of payments to the public school board. Metro also lent funds, at market rates of interest, to the public school board from time to time, especially in the beginning of the year prior to the receipt of the first interim levies from the Area Municipalities.

A separate matter affecting the City's relationship with the school boards is the use of school board facilities by the City to deliver day care services and parks and recreation programs.

School officials and trustees have raised concerns that up to $50.0 million of costs associated with various Community Support Services currently funded by the boards will not be recognized under the new education funding formulae, the details of which have yet to be announced.

In anticipation of this change, staff have been examining several specific areas where there may be a financial impact on the City. The City currently has 300 child care centres located in facilities owned by the school boards and there are numerous agreements between the old Municipalities and their existing Boards of Education covering the use of arenas, pools and community centres. As well, some of the old municipalities provide additional services to the boards such as grass cutting and snow ploughing. All of these services would be at risk if the new school boards were to levy a charge for the City's use of the school facilities.

Presently, the basis for the agreements vary throughout the City but overall, the intent has been to maximize the use of the facilities for the overall benefit to the community without either party making a profit from the arrangement.

Discussion:

There are two issues to be considered in this report: (a) the impact of the new legislation on cash flow of tax levy payments to school boards and interest income of the City and the school boards and (b) the use of school board facilities by the City to provide services.

(A) Cash Flow of Payments to School Boards:

(i) Impact of Quarterly Instalments:

Adoption of the quarterly tax levy payment provisions of Bill 160 will have a significant beneficial impact on the City's operating budget and corresponding negative impact on the school boards' budgets. It is estimated that the benefit to the City of the payment provisions in Bill 160 is an increase in 1998 budgeted investment income (assuming a short term investment rate of 4.5 percent) of $13.9 million of which $11.9 million is due to the change in payment dates to the public school board and $2.0 million to the separate school board. The greater amount for the public school board is due to the larger proportion of school taxes collected on behalf of the board but also due to the fact that under the previous arrangements the public school board received its portion of the levy on average earlier than the separate board.

City staff are of the opinion that the proposed change in the schedule of payments to the school boards is just one of the many changes to the relationship among the City, the school boards and the Province. This happens to be one of the few options that is beneficial to the City. Moreover, the change in legislation brings consistency to the payment dates of educational taxes across the Province. Rather than the City attempting to continue the previous payment arrangements, it will be more effective for the school boards collectively to negotiate with the Province to incorporate the impact of Section 257.11 of Bill 160 into their funding formula with the Province. It is recommended, therefore, that the City make quarterly payments of the education portion of the levy to the Toronto District School Board and the Toronto Catholic District School Board in accordance with the dates in Section 257.11 of Bill 160.

(ii) Provisions for Funding:

It is also anticipated, assuming that the Province remits its portion of funding to the school boards monthly, that the school boards will for most of the year need to borrow funds rather than be in a position to invest surplus funds. This results from the fact that (a) the school boards will now receive a significant portion of their current funding after they have already made the corresponding expenditures, (b) the school boards have little in the way of cash reserves, and (c) the public school board usually carries significant unfunded capital expenditure balances. City staff recognize the need to assist in the cash flow funding of the school boards and recommend lending financial assistance in a manner to benefit the taxpayer. In this respect, it is recommended that the City lend funds to either school board in amounts necessary to ensure that the school boards can meet their financial commitments on a timely basis. Ontario Regulation 438/97, the most recent legislation governing permissible municipal investments, permits the City to invest in securities of a Canadian school board provided the funds received by the school board are used for school purposes and the security is to be repaid entirely from taxes or government grants. The City's investment policy, adopted by Council at its inaugural meeting on January 6, 1998, allows the City to invest in the securities of Canadian school boards. This proposed assistance is consistent with that provided previously by Metro to the public school board. In anticipation of the school boards' requirements and other possible needs, the City has arranged lines of credit with its bankers in the amount of $500 million and has established short term credit ratings for its promissory notes in the event that the City needs to borrow on a temporary basis. It is further recommended that the interest rate on any loans to the school boards be approximately the same as the cost to the City to borrow such funds, or stated another way, the opportunity cost of not investing surplus funds elsewhere, rather than the prime rate of interest as legislated in Section 257.11 of Bill 160 for school board advances. This concession provides for the best joint use of funds.

(B) Use of School Board Facilities:

(i) Day Care Facilities on School Property:

Currently, 40 percent of licensed child care spaces in the new City are located in facilities owned by the Board of Education. Day care facilities located in schools are charged for caretaking and maintenance costs but the rent for the space in the facilities varies from a minimal $1.00 per year to a per square foot charge below the market rate. Over the last few years more boards have started to charge a per square foot rate for the use of the property for child care. East York, for example, which had historically provided free accommodation and caretaking to child care programs began charging $3.50 per square foot in 1996 with further increases planned. Children's Services have estimated that the incremental cost of moving from the current average rent of $102.00 per space per year paid to the Metropolitan Toronto District School Board to an estimated $498.00 per space, (i.e. market rate), is $5.0 million annually. School board officials have indicated that the minimum cost could be in the range of $3.5 million in additional charges.

Failure to provide adequate funding to cover the occupancy cost could result in the closure of the affected centres and the potential loss of up to 500 subsidy spaces. Any reduction in the level of subsidized services provided will place the new City in contravention of the Service Contract between the City and the Province, which requires the maintenance of the 1997 service level in 1998. Failure to maintain the 1997 service level will result in the loss of the use of all the user fees under Regulation 262 of the Day Nursery Act. The City will be required to return to the former practice of having to share the user fee with the Province on a 80/20 basis. Having access to only 20 percent of the user fees will mean that existing tax dollars raised for day care will not be adequate to provide sufficient funding for the number of spaces in existence now and consequently more spaces would be lost.

(ii) Parks and Recreation Use of School Facilities:

There are numerous agreements and arrangements between the City and both the public and separate schools boards for shared use of Community Recreation Centres, playgrounds or other miscellaneous facilities.

In North York, for example, the City provides grass cutting for the school board in exchange for the use of the facility for the Community. The former City of Toronto, for example, has 89 formal agreements with the public school board and 9 agreements with the separate school board. Appendix "A" provides a summary of annual hours of school use by the former Municipalities.

The former City of Toronto has provided capital contributions to the public school board for construction of recreational facilities or community centres on its property and the board in exchange allows the City exclusive rights to operate City facilities on board property and to use the shared facilities (e.g. pools or playground) after 6:00 p.m. weekdays and on Saturdays and Sundays throughout the year. In most cases, the boards have the responsibility to provide caretaking and maintenance but recover any of the costs incurred by the boards as a direct result of use by the City. The new education funding formulae for all these facilities may put at risk all non-teaching activities provided by the school boards. If that is the case, the school boards, in order to maintain and keep the facilities operational will start to charge market rates for any use by the City. The value of the capital contribution made to the boards by the former City of Toronto will have to be taken into consideration when negotiating any charges to be incurred by the new City of Toronto.

The overall principle that needs to be maintained is that these facilities have been brought into existence by the use of tax dollars and the ultimate objective should be to maximize their use for the students and the community. Currently when a school facility is not in use by the students, the community has free access to it, subject to City reimbursement of school janitorial costs.

(C) School Board Reaction:

During December 1997, City staff met with representatives of both school boards to discuss the provisions of Bill 160. City staff indicated their intention to recommend, effective January1, 1998, payment of quarterly instalments of education taxes to the school boards, while continuing the previous practice of lending funds to the school boards from time to time. City staff also noted that the issue of fees for use of school board facilities by the City was complex with numerous formal and informal agreements in place and that further discussions were required to resolve these issues. Not surprisingly, the school board officials were strongly opposed to any change in the timing of payments of education taxes, preferring to maintain the status quo. In their opinion, the changes to the legislation still allow for a municipality to vary payment dates and the City is taking advantage of Bill 160 to download some of its budgetary pressures onto the school boards. The school boards further indicated that a fee for services for non-educational activities of the school boards would not help offset the interest on temporary loans, since losses in provincial subsidy are expected on non-educational activities.

Conclusions:

It is recommended that taxes collected by the City for education purposes be paid to the Toronto District School Boards in quarterly instalments in accordance with Section 257.11 of Bill 160. This policy will increase 1998 budgeted investment income by an estimated $13.9 million. However, the City recognizes the need to assist in the temporary financing of the school boards and it is recommended that the City lend funds to the school boards from time to time at interest rates equivalent to the City's borrowing rate for similar terms.

The appropriate application of school board fees for the City's use of school facilities to provide services and programs is complex. City staff will work with the school boards to reach a mutually satisfactory arrangement for consideration in the 1998 City of Toronto operating budget.



Contact Names:

Charles Milne, Finance Manager

Phone number: 392-8100

Fax number: 392-3649

E-Mail address: charles_r.c._milne@metrodesk.metrotor.on.ca

Shekhar Prasad, Director of Financial Planning and Analysis

Phone number: 392-8095

Fax number: 392-3649

E-Mail address: shekhar_prasad@metrodesk.metrotor.on.ca

--------

Appendix A

Annual Hours of School Use

for Parks and Recreation Purposes

Former

Municipality

Classroom/

Gymnasia

Pools

at Public Schools

Toronto Public Board 66,600 hours 12 shared use pools 24,000 hours
MSSB 7,400 hours 9 board pools 17,010 hours
North York Public Board 69,179 hours 13 pools 13,777 hours
MSSB Limited Use
York Public Board 5,575 hours 5 pools 4,673 hours
MSSB 347 hours
Etobicoke Public Board 65,151 hours 2 pools operated by Parks &

Recreation

MSSB 5,361 hours
Scarborough Public Board 40,613 hours 13 shared use pools 31,276 hours
MSSB 2,966 hours
East York Public Board 859 hours 2,215 hours (by dept)

1,609 hours (by public swim club)

MSSB Limited Use



(Report dated January 22, 1998, addressed to the Budget Committee

from the Chief Financial Officer and Treasurer)

Purpose:

To respond to Recommendations (7) and (9) regarding Notice of Motion (b) adopted by Council at its meeting of January 2, 6, 8 and 9, 1998 and to provide additional information regarding the financial relationship between the City and the Toronto District School Boards.

Source of Funds:

Not applicable.

Recommendations:

It is recommended that this report be received for information purposes.

Background:

At its meeting of Jan 2, 6, 8 and 9, 1998 Council adopted the following recommendations:

"(7) the Chief Financial Officer and Treasurer be directed to ensure that the School Board costs to the residential taxpayers are spread equally over the 1998 tax billing period, provided Provincial legislation does not prevent or penalize City Council from doing so; and

(9) prior to property taxes collected being sent to the Toronto Boards of Education, the Chief Financial Officer and Treasurer be requested to submit a report to Council on the total cost for Provincial services that are now the financial responsibility of the new City of Toronto and the funds available to pay for these services from the Provincial changes to the education portion of the residential property taxes in Toronto."

This report addresses these recommendations and also presents additional information concerning the financial relationship of the City with the Toronto District School Boards.

Discussion:

The City raises taxes on an interim basis and on a final basis. All other things being equal (e.g. no tax increase), the interim levy is approximately the same as the final levy so that the taxpayer is billed equally over the tax billing period. Prior to 1998, the school board portion of the tax levy was requested by the school boards and was also collected from the taxpayer equally over the tax billing period. The total amount raised by the 1998 interim levy has been calculated as 50 percent of the 1997 total estimates of the former Area Municipalities, Metro and the School Boards; therefore, there is no increase in total taxation revenue in the interim levy and the cost to all the taxpayers will be spread out evenly over the tax billing period. The one difference this year is that the portion of taxes collected for education will be less and the portion for the City greater in order to account for the restructuring of responsibilities. At this time the relative amounts are uncertain and require further information from the Province on many items. City staff are working with the Province to provide definitive answers to this question.

Bill 160, the Act to reform the education system, is quite specific as to the dates and amounts of the payment of taxes raised for education purposes to school boards.

Section 257.11 subsection (1) of the Act states:

"(1) In each calendar year, a municipality or board shall pay amounts levied for school purposes in the following instalments:

(1) Twenty-five percent of the amount levied for the previous calendar year, on or before March 31.

(2) Fifty percent of the amount levied for the current calendar year less the amount of the instalment under paragraph 1, on or before June 30.

(3) Twenty-five percent of the amount levied for the current calendar year, on or before September 30.

(4) The balance of the amount levied for the current calendar year, on or before December 15."

However, to accommodate 1998, which is a transition year, Section 257.11 subsection (9) of the Act states for 1998, only the total payment on or before March 31, 1998 shall be the sum of,

(a) 12.5 percent of the amount levied for school purposes for 1997 on residential and farm assessment, within the meaning of section 248 of this Act as it read on December31, 1997, in the area in respect of which the municipality or board levies taxes under section 257.7; and

(b) 25 percent of the amount levied for school purposes for 1997 on commercial assessment, within the meaning of section 248 of this Act as it read on December31,1997, in the area in respect of which the municipality or board levies taxes under section 257.7."

These pieces of legislation provide the basis for municipalities to remit education levies to school boards quarterly in approximately equal payments. The total 1998 payments to the school boards are uncertain. The first quarterly payment, calculated in accordance with Section 257.11, subsection (9) of Bill 160, is estimated at approximately $476.7 million, the amounts of the remaining quarterly payments are uncertain at this time. It should be noted that, in accordance with legislation, it is the intention of the City to continue the practice of remitting to the school boards the total amount levied for educational purposes regardless of whether the City has collected the full amount. The City bears the carrying cost of delinquent payments although the City collects and retains penalty interest on both the City's and the school board's portion of the levy.

The total cost for Provincial services that are now the financial responsibility of the City is estimated at $736.7 million. Final amounts are not yet available. Moreover, the timing of payment for the transferred responsibilities is still to be determined. The funds available to pay for these services, that relate to the portion of residential taxes that formerly went to the school board, are estimated by the Province at approximately $573.2 million. City staff have yet to hear from the Province on how this amount was determined.

The first payment of the education portion of the levy to the school boards, the only amount known with any degree of certainty and which is due on or before March 31, 1998, will be approximately $476.7 million. By that time it is estimated that the City will have loans outstanding to the public school board of $400 million on account of current expenditures and $100 million on unfunded capital expenditures. The City will net the payment due to the public school board against the sum of the loans outstanding. Any excess will be invested on behalf of the school board and any deficit be lent to the school board until June 30, the next quarterly payment date. The separate school board has not requested the City to provide interim financing.

The report entitled "Financial Relationships with the Toronto District School Boards" which was submitted to the Budget Committee for consideration at its meeting of January 26, 1998, recommended that the education levy to School Boards be remitted at the end of each quarter. Discussions with other municipalities across Ontario indicate that the overwhelming majority of municipalities have always remitted education taxes quarterly. Three cities that had arrangements in 1997 which were more favourable to the school boards indicate that they plan to change to quarterly payments in 1998.

Conclusions:

Bill 160 prescribes the minimum amounts and times of payments to the school boards, and has provisions for 1998, the transition year, to ensure that these payments are spread evenly over the 1998 tax billing period. The latest estimate for the total cost for Provincial services, that are now the financial responsibility of the City, is $736.7 million. The funds available to pay for those services, that are available from the portion of residential taxes that formerly went to the school boards, have been estimated by the Province at $573.2 million.

Contact Name:

Charles Milne, Finance Manager

Phone number: 392-8100

Fax number: 392-3649

E-Mail address: charles_r.c._milne@metrodesk.metrotor.on.ca

Shekhar Prasad, Director of Financial Planning & Analysis

Phone number: 392-8095

Fax number: 392-3649

E-Mail address: shekhar_prasad@metrodesk.metrotor.on.ca

--------

(Submission dated January 26, 1998, addressed to the

Budget Committee from Mr. Joseph Martino, Chair,

Toronto Catholic District School Board)

Good Morning, Councillors. We appreciate receiving a place on your agenda for what is to us a matter of great importance. Although we have been just presented with an amendment to the staff recommendation, it does not address our circumstances.

I believe you have received the text of our reasons for appearing here today regarding the frequency of transfer payments of education taxes collected by the City on behalf of the Public and Catholic School Boards which serve our City's children.

As you know the Toronto District School Board is also here today and we share a common concern regarding the recommendations by the Chief Financial Officer of the City.

Since 1953, the former Metropolitan Separate School Board received its tax instalments from the Metropolitan Toronto municipalities monthly. The decision to change these payments to quarterly arises from the Education Quality Improvement Act -- Bill 169. It would be too easy to immediately criticize the Bill as it does provide flexibility.

As your staff report indicates, the Bill specifies that municipalities "shall" pay to boards monthly. However, four paragraphs later, the Act states "despite (quarterly payments) a board may make an agreement with the municipality to vary the amount and number of (tax) instalments". This is unchanged from the former Education Act.

Therefore, it is totally within the power of this committee to reject the staff recommendation. Instead, this committee can make the right decision, an informed decision and reject doing anything that would put further undue financial pressure on either the Public of Catholic schools of our City.

The impact on our Board by this change to our tax payments is two million dollars annually in interest costs to finance our cash flow. This is calculated at today's prevailing interest rate. The impact in a higher interest rate environment would be even more profound. For the context of the total budget year for the City which approaches six and one-half billion dollars the two million dollar cash flow cost to our Board represents 0.0003 percent of the City's budget. Yet for us the amount, if lost, represents a great deal to our schools and our children - the children who live here in the City. They are the same children whose parents, aunts, uncles and grandparents are your constituents living in all neighbourhoods of this City.

Let us be clear about another factor. In 1997 while receiving monthly payments our calculations reveal that the combined municipalities of the former Metropolitan Toronto earned approximately 2.9 million dollars on cash flow of the tax levy withheld from us between payments.

Using 1997 figures, if we were paid quarterly last year that figure would have risen dramatically to 4.4 million dollars out of the classrooms of catholic school children. While in 1998, these figures would be halved, this is certainly enough money to recoup any extra administrative costs to sending us twelve cheques a year versus four.

The City staff report acknowledges that this change would be "beneficial" to the City at the expense of both Public and Catholic School Boards and that the City would profit by 13.9 million dollars from funds which are paid by property taxpayers for education purposes.

To our schools 2 million dollars represents 34 teachers or 52 support staff or 8 percent of the cost of the classroom supplies or 28 percent of our junior kindergarten budget. Based on the 4.4 million that the City would actually earn on our money and you can more than double those figures. 70 teachers or almost 60 percent of our junior kindergarten budget!

Some may say that school boards should be equally prepared to make reductions in costs to balance the budget. As a School Board that is dependent on provincial grants, we have seen reductions since 1990.

We have cut our staff by over 500, reduced programs, tolerated substandard facilities, and the list goes on. Our schools have been historically underfunded.

We are not in a position to take another 2 million dollars out of our budget while at the same time trying to cope with an accumulated deficit of over 6 million dollars and an uncertain short year grant and new funding formula.

We understand the City's problem with provincial downloading. We have been party to this since 1990. However, these funds are meant for the education of our children in our schools and in Toronto's public schools.

In your information package you will find a cash-flow forecast. The reality is if these staff recommendations proceed, the City will be responsible for our Board incurring a cash flow shortfall in June 1998 of almost 120 million dollars.

When ratepayers pay their tax bill, I am certain that they expect that the City and the School Boards cooperate to ensure that all taxpayers receive value for their money. We are, hopefully, working toward the same end - to make this City a better place for all to live, work and learn together.

We believe the property taxes fixed through the rates set by the provincial government, and collected by the City on our behalf, are meant to be used as expeditiously as possible by the applicable School Boards within this City.

We have outlined in your package what 2 million dollars means to our Board, to the children we educate. We urge you to do what is right for our ratepayers, for our children, by rejecting the quarterly payments.

We are asking the committee to show good faith to all citizens of Toronto, but especially to the children in our Public and Catholic schools and adopt our request and that of our friends in the Toronto District School Board for a return to fairness. Our coterminous boards received their funds on a more frequent basis than Catholic schools.

In the spirit of Bill 160's theme of "fair and non-discriminatory funding" and the right of all citizens to equity, our request is for the same fiscal transfer arrangement as the Toronto District School Board. At the very least, we expect a return to what is to us a forty-five year precedent of receiving our ratepayers' tax dollars monthly.

Thank you.

--------

(Toronto District School Board Meeting of January 23, 1998,

with the Chair of the Budget Committee)

(Speaking notes)

The Issues:

(1) The City of Toronto faced with significant budget/cost impact from the Provincial disentanglement.

(2) The Toronto District School Board (TDSB) also faces significant funding reduction:

(a) January, 1998 to August, 1998 = $37 million.

(b) Anticipated funding cuts starting in September, 1998 to August, 1999 fiscal period = $150 to $300 million.

(3) The City has identified a significant area in which to reduce its costs by $14 million by changing to a quarterly payment of School Taxes.

(4) The agreement that existed with the former Municipality of Metropolitan Toronto will be changed by the City to be in conformity with Section 257.11(1) of the Education Act to provide quarterly payments of the school taxes to the TDSB.

(5) The estimated annual revenue reduction to the TDSB is about $15 million based on current interest rates, $7.5 million in our Short Period.

(6) This will impact classroom support expenditures.

(7) It will compound our Provincial funding cuts now and in the future.

(a) It is additional job loss and reduced classroom support.

(8) The City has several options in dealing with its budget problems. TDSB has only one.

(9) The budget reduction faced in our 1998 Short Period of $37 million will bring an aggregate total cost reduction since 1992 of approximately $250 million.

(a) During this period, our enrolment has increased by 25,000 students.

(b) The tax base has declined 10 percent or $200 million lower than 1992

(c) Tax withdrawal expenditures to be absorbed were an average of $63 million or $40 million higher than 1992.

(d) Average mill rate increase of 1.9 percent over the past five years.

(10) The TDSB has made a significant revenue contribution to the city of Toronto in prior years:

(a) Increased taxes from updates to vacancy report = $39 million in 1997

(b) Participation in property tax appeals have contained the level of revenue loss.

(11) TDSB has offered to continue our work on a cost recovery basis plus a small share of the revenue gained. Net win for the City.

Conclusion:

In conclusion, a healthy, vibrant and attractive city needs an education system that has the required funding to sustain the acknowledged quality of its programs and services. The lost revenue will negatively impact its education system.

The Public School Board and the Separate School Board and the 400,000 students they serve, petition the Mayor and Council of the City of Toronto to continue to honour the agreement regarding the payment of school taxes on the same basis as the former Metro Council had agreed to in 1991.

--------

Toronto District School Board

Briefing Notes

Change in Timing of School Tax Payments

by the City of Toronto to the Toronto District School Board

The reputation of the City of Toronto on a national and international level for its quality of life and high standards of service to its community is in large measure based on the quality of its education system. The strength of the education system is due to the quality of its programs and the outstanding teaching staff and support services. This in turn is a function or our ability to sustain the appropriate level of funding to support the education system.

The Toronto District School Board's (School Board) ability to sustain its programs and services is threatened by the provincial government current and planned funding models just as the City of Toronto is under significant financial pressures as a result of the recently revealed costs of disentanglement.

While the School Board recognizes the significant challenges faced by the City in addressing its 1998 budget, the City's cost increases are no less significant than the School Board's reduced funding that it will have to adjust to in the short and long term.

(1) The funding shortfall from the Province for the Short Period January 1, 1998 to August31,1998, is estimated to be $37 million or $44 million, including the impact of the City's change in payment of the school taxes.

(2) The anticipated cut in funding when the new funding model begins to be implemented in the year September 1998 to August 1999 is estimated to be in the range of $150 million to $300 million. Until the new funding is released by the Ministry of Education, we are uncertain what reductions will be imposed and if a phase-in period will be provided.

The City's action of transferring part of its budget problems onto the students of the School Board will reduce our funding in the Short Period by about $7.5 million and on an annual basis this will be a $15 million loss to the School Board.

The province will not recognize this lost revenue because its objective is to reduce the overall costs of education just as the province is downloading its costs onto municipal governments.

The School Board has had a long standing agreement with the former Municipality of Metropolitan Toronto since 1990 for the timely payment of school taxes. To change the basis of payment at a time when the Province cuts the funding to education and when the school system has committed its budget half way through the school year, leaves the School Board facing decisions that may impact classroom support. Further, the School Board's legal Counsel has advised that the arrangement constitutes an agreement and as such, in order for the City to change the basis of payments of school taxes, they should have notified us by October 31, 1997, which is required by the Education Act under Section 243(4) which is now covered by the Education Quality Improvement Act under Section257.11(8).

In meetings with members of the Transition Team and senior City officials in the fall, we were led to believe that the tax payment system would not be significantly altered. It was only on December 22 that we were advised of the change in the City's plans.

The City has several options to address its budget problems:

(1) reduce costs of its programs and services just as the school board is doing;

(2) increase user fees for certain services;

(3) consolidate the property tax billing and collection system and processes, and in the longer term consider establishing a GTA agency to handle all billing and collection of property taxes; and

(4) modest increase in property taxes.

The School Board has only one option to deal with the funding shortfall now and in the future. It must reduce support services to the classroom and in the future re-examine other areas such as community use of school facilities where little or no costs are being recovered. The new education funding model is not expected to recognize the cost of providing community use or municipal use of our school facilities.

The fact that the City has recognized the need to re-examine the cost sharing arrangements with the School Board is a positive step, however, this will in no way offset the loss of revenue from the change in tax payments. We will lose our funding to cover the shared service costs and therefore we will either have to begin to seek full cost recovery and/or significantly reduce or eliminate access.

The Toronto District School Board has made a significant contribution to the former Metro municipalities' ability to maintain low or zero mill rate increases over the past several years. This is due to the Public School Board's activities:

(a) in large commercial and industrial property tax appeals where we have defended the tax base to ensure fair and reasonable settlements of tax appeals; and

(b) since 1995, providing updates to the commercial and industrial "vacancy" reports where tenants are found to be occupying property reported as vacant. A vacant commercial/industrial property pays tax at the residential rate and no business tax.

In 1997 alone, our "vacancy" work resulted in assessment role updates provided to municipalities having an annualized tax increase worth over $39 million including 1996 and 1995 back taxes of about $14 million. Many tenants had occupied the "vacant property" for two or three years. In spite of this contribution, the City's REWARD is to transfer over $16 million of its costs to the Public and Separate School Boards.

We have presented an offer to senior City officials, as well as the Ministry of Finance, to continue providing our services to pursue the "vacant report" update work. Neither the City nor the Ministry of Finance have sufficient trained staff nor the support systems to carry out this function. The potential recovery of tax revenue would offset the gain the City will obtain from changing the timing of school tax payments. The cost of this service would pale in comparison to the potential revenue gain. We have had no response to our offer from the City. The vacancy report for 1998 lists over 22,000 vacancies of which 10 percent to 15 percent are likely occupied and not paying a fair share of taxes. We look forward to a timely agreement which will result in a contribution to the City's zero mill rate target.

In conclusion, a healthy vibrant and attractive city needs an education system that has the required funding to sustain the acknowledged quality of its programs and services. The lost revenue will negatively impact its education system.

The Public School Board and the Separate School Board and the 400,000 students they serve petition the Mayor and Council of the City of Toronto to continue to honour the agreement regarding the payment of school taxes on the same basis as the former Metro Council had agreed to in 1991.

Thank you.

(A copy of background material attached to the communication dated January 26, 1998, from Mr. Joseph Martino, Chair, Toronto Catholic District School Board, was forwarded to all Members of Council with the agenda of the Strategic Policies and Priorities Committee meeting of February 3, 1998, and a copy thereof is on file in the office of the City Clerk.)

(Councillor Cho, at the meeting of City Council on February 4, 5 and 6, 1998, declared his interest in the foregoing Clause, in that he is a teacher on leave of absence from the Toronto District School Board.)

(Councillor Moscoe, at the meeting of City Council on February 4, 5 and 6, 1998, declared his interest in the foregoing Clause, in that he has three children who are employed by the Toronto District School Board.)

10

Expenditure Reduction Proposals -

Cost of Salaries, Wages and Benefits

(City Council on February 4, 5 and 6, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January28,1998) from the Budget Committee:

Recommendations:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee that:

(1) the joint report (January 26, 1998) from the Chief Administrative Officer, Commissioner of Human Resources and Chief Financial Officer and Treasurer be adopted, which recommends the following:

"It is recommended that the Budget Committee adopt the proposals and recommendations for reduction in the cost of salaries, wages and benefits, as outlined in this report."; and

(2) the Agencies, Boards and Commissions of the City be urged to apply the same proposals and recommendations set out in the aforementioned report and that they be asked to also restrict external hiring, as much as possible, and look to the municipality for possible candidates for vacant positions.

Background:

The Budget Committee had before it a report (January 26, 1998) from the Chief Administrative Officer, Commissioner of Human Resources and Chief Financial Officer and Treasurer responding to the request of the Budget Committee with respect to proposals and recommendations to reduce the cost of salaries, wages and benefits.

--------

(Joint report dated January 26, 1998, addressed to the Budget Committee

from the Chief Administrative Officer, Commissioner of Human Resources and

the Chief Financial Officer and Treasurer)

Purpose:

This report responds to a request of the Budget Committee with respect to proposals and recommendations to reduce the cost of salaries, wages and benefits.

Financial Implications:

It is not possible at this time to quantify the actual savings that will accrue as a result of these proposals. The intention is to ensure that there are the appropriate processes and controls in place to freeze the cost of salaries, wages and benefits while restructuring and budget initiatives are underway. The latter two initiatives will provide a clearer picture of the positive financial implications of the recommendations within this report.

Recommendation:

It is recommended that the Budget Committee adopt the proposals and recommendations for reduction in the cost of salaries, wages and benefits, as outlined in this report.

Background:

The attached motion by Councillor Jakobek was before the Budget Committee on January 20, 1998, and was referred to the Chief Administrative Officer, the Commissioner of Human Resources and the Chief Financial Officer and Treasurer for report to the Budget Committee meeting onJanuary26, 1998.

Discussion:

(1) Implementation of a Hiring Freeze:

It is appropriate that a hiring freeze be supported by the Budget Committee, as long as there is a process to allow exceptions for those positions which provide direct, front-line, essential services to the public. An appropriate example for an exception is where a vacancy has occurred in a service that has mandatory staffing levels - e.g., a home for the aged.

Recognizing that there are collective agreement provisions that must be respected, that there are critical services which cannot be altered and that staff should be moved to the highest priority work, the following actions will be taken:

(i) vacant positions will remain unfilled, unless an exception is granted (see next section);

(ii) internal promotions or transfers will be made on a temporary/acting basis with the provision that these will revert back. An ongoing review process will be implemented (e.g. every six months). During the temporary/acting period, a significant alternate position must be left vacant;

(iii) transfers across the former geographic boundaries should be facilitated; and

(iv) external recruitment will be limited to casual, temporary and short-term contract staffing where the employment relationship can be concluded with four (4) weeks or less notice.

These recommendations mirror what generally occurred in most of the former municipalities during the past six months leading up to amalgamation. Again, exceptions have been and must continue to be made to ensure efficient and effective service delivery.

Agencies, Boards and Commissions will be asked to restrict external hiring and, as much as possible, look to the municipality for possible candidates for vacant positions.

(2) Process for Exceptions:

Exceptions must be restricted to positions that provide direct, frontline, essential services to the public. Council's goal to ensure no disruption in service delivery must be preserved. While departments will be asked to be diligent and creative in moving staff around to accomplish reductions in staffing costs, there will be situations where positions will have to be filled.

It is proposed that the following process be followed when an exception is contemplated:

(i) exceptions will be approved by the Commissioner of Human Resources and the Chief Financial Officer and Treasurer;

(ii) the request must be supported by the interim functional lead for the service area and the appropriate Acting Executive Commissioner;

(iii) the request must include a discussion of impact on service delivery, cost implications, future plans for the position and other alternatives explored; and

(iv) a list of exceptions granted will be provided to the Budget Committee on a regular basis for information.

(3) Position and Establishment Control:

A process has been put in place by the Human Resources Department which ensures position and establishment control. A senior human resources employee has been assigned to each functional area to provide control, guidance and assistance as the departments plan their amalgamation. The internal audit function will also be used throughout the early months of 1998 to monitor the control mechanisms.

Departments have also been asked, through the 1998 budget process, to identify vacant positions. Where possible, subject to restructuring, these positions will be deleted.

The Finance and Human Resources Departments, in conjunction with the internal auditor, are actively creating an integrated control system which would ensure monitoring of position and establishment control through both the Financial Information System and the Human Resources Information System.

The former City of Toronto had a process whereby positions that were not funded as part of the budget process, remained listed on the establishment for the department. This was to allow the department to re-justify the need for the position during a future budget year. Given that we are in a different fiscal and operating environment, it is also recommended that positions currently listed as part of the establishment, but unfunded, be immediately deleted from the establishment.

(4) Conversion of Full-Time Positions to Part-Time Positions:

This is an appropriate concept if the department, subject to collective agreement provisions, can re-organize the work to allow for a part-time employee instead of a full-time employee. It is also appropriate if the department is required to find budget reductions and is not able to fully eliminate the position.

(5) Restrictions on Conversion of Positions of Part-Time Positions to Full-Time Positions or Temporary Positions to Permanent Positions:

It is appropriate to introduce both of these restrictions as part of the general hiring restrictions. Conversions must be justified through the exception process outlined above, through the 1998 budget process, or through the department's restructuring plans.

(6) Job-Share Policy:

Several of the former municipalities had a job-share policy in place. The Human Resources Department is developing a common policy for Council's approval. It is an appropriate way to reduce expenditures while allowing flexibility based on changing lifestyle needs of the employees, as long as the operational requirements of the department are considered.

(7) An Appropriate Gapping Policy:

The introduction of an appropriate gapping policy is being assessed in the context of the 1998 Budget. A further report will be submitted to the Budget Committee in the near future. A gapping provision of between 1 percent and 5 percent of expenditures on salaries and wages is being contemplated.

(8) Voluntary Leaves of Absence:

Many of the former municipalities used voluntary leaves of absences over the past several years to generate expenditure savings. It should be noted that these are not permanent savings and cannot be counted on to reduce the ongoing expenditure levels. However, this concept was well supported by employees and, as long as departments were allowed to accept or reject requests based on operational needs, was endorsed by management.

It is recommended that the Commissioner of Human Resources implement a voluntary leave of absence program for 1998.

(9) Accelerated Savings on Benefit Plans Administration:

Staff is in the process of reviewing recommendations from a Benefits Consultant hired through the Toronto Transition Team. It is anticipated that a report will be before the Strategic Policies and Priorities Committee in February or March. The idea of accelerating administrative cost reductions for benefits plans will be contained in that report.

(10) Employee Separation Programs:

It is recommended that the Budget Committee support the funding requirements of the Employee Separation Program that was proposed to the Strategic Policies and Priorities Committee on January19, 1998. This is a critical area where reductions will be generated in the cost of salaries and benefits for several key employee groups.

A separation program for union employees is being developed for consideration by the Strategic Policies and Priorities Committee in February or March. The approval of the Budget Committee for additional funding will be required at that time.

(11) Review of Compensation and Benefit Plans:

The result of a Request for Proposal to review and recommend a new Compensation Scheme for the corporation will be before the Strategic Policies and Priorities Committee on February 24. The consideration of the Budget Committee, for funding approval, will be required.

(12) Re-Training and Re-Skilling Strategy:

Plans and expenditures for a re-training and re-skilling strategy will be placed before the appropriate committees and Council. The strategy will be tailored to the needs of the corporation and employees as a result of 1998 budget initiatives and departmental restructuring plans. Approval of funding by the Budget Committee will be required at the appropriate time.

The Chief Financial Officer and Treasurer will include a provision for the re-training and re-skilling strategy in the upcoming report to the Budget Committee on transition costs.

Longer-term plans for re-training and re-skilling will be included in the Strategic Human Resources Plan to be placed before the Strategic Policies and Priorities Committee in August 1998.

Conclusion:

The initiatives outlined in this report will serve to "freeze" the cost of salaries, wages and benefits while allowing staff and Council time to consider the 1998 budget requirements for these types of expenditures. Further action to reduce costs in these areas will be targeted for completion during, and as a result of, the strategic restructuring initiative.

It is recommended that the Budget Committee support the recommendations contained in this report.

--------

(Motion of Councillor Jakobek)

WHEREAS the City of Toronto is facing a budget shortfall in 1998 as a result of financial pressures and provincial downloading; and

WHEREAS, because of the magnitude and scope of the initiative, the 1998 budget process and schedule will take several months to complete; and

WHEREAS it is important to begin to generate savings in the expenditures of the City to assist with accommodating the pressures on the 1998 Operating Budget; and

WHEREAS the costs of salaries, wages and benefits are a large component of the expenditures of the City;

BE IT THEREFORE RESOLVED THAT:

(1) the Chief Administrative Officer immediately implement a hiring freeze, with the exception of those positions which provide direct, front-line, essential services to the public;

(2) any exceptions made to the hiring freeze for positions in direct, front-line, essential services be approved by the Chief Financial Officer and Commissioner of Human Resources and reported quarterly to the Budget Committee;

(3) Chief Administrative Officer, Chief Financial Officer and Treasurer, and the Commissioner of Human Resources be instructed to submit a report to an early meeting of the Budget Committee on methods to achieve savings in the cost of salaries, wages and benefits;

(4) the report include expenditure reduction proposals and recommendations for:

(a) processes to ensure position and establishment control;

(b) conversion of full-time positions to part-time positions as appropriate based on operational needs;

(c) restrictions on the conversion of part-time positions to full-time positions;

(d) restrictions on the conversion of temporary positions to permanent positions;

(e) a job share policy;

(f) an appropriate gapping policy;

(g) the use of voluntary leaves of absence;

(h) accelerated savings on benefit plans administration;

(i) additional ideas on expenditure reductions for salaries, wages and benefits;

(5) the accelerated implementation of employee separation programs be supported by Council;

(6) the review of compensation and benefit plans be accelerated; and

(7) a report be submitted to the appropriate Standing Committee with respect to plans and expenditures for re-training and re-skilling employees whose positions have been declared redundant.



11

1998 Operating Budget - A Phased Review Approach

(City Council on February 4, 5 and 6, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January 28, 1998) from the Budget Committee:

Recommendations:

The Budget Committee on January 26, 1998, recommended to the Strategic Policies and Priorities Committee that:

(1) the report (January 19, 1998) from the Chief Financial Officer and Treasurer be adopted, which recommended that:

(a) Phase 1 in the budget review process focus on a review of the base budgets and the work of the Transition Team as it relates to the City budget pressures;

(b) Phase 2 in the budget review process focus on the options available to address the $164 million in provincial downloading; and

(2) the target for each Department, Board and Commission be up to 15 percent in cuts, and include those reductions already found by the Transition Team, and that the recommendations be reported back to the Budget Committee by listing the impact of each percentage reduction, such recommendations not to include front line services.

Background:

The Budget Committee had before it a report (January 19, 1998) from the Chief Financial Officer and Treasurer providing an overview of the operating budget pressures and the work to date, and a recommended overall strategy for dealing with the budget.

--------

(Report dated January 19, 1998, addressed to the

Budget Committee from the

Chief Financial Officer and Treasurer)

Purpose:

The purpose of this report is to provide an overview of the operating budget pressures and the work to date and a recommended overall strategy for dealing with the budget.

Recommendations:

It is recommended that:

(1) Phase 1 in the budget review process focus on a review of the base budgets and the work of the Transition Team as it relates to the City budget pressures; and

(2) Phase 2 in the budget review process focus on the options available to address the $164 million in provincial downloading.

Background:

The Provincial Transition Team in co-operation with the staff of the former cities has recently released a preliminary 1998 operating budget based on maintaining property tax stability (zero percent increase) and maintaining service levels that focused on addressing City budget pressures of approximately $150 million.

Discussion:

(1) City Budget Pressures:

City Budget pressures of $150 million were identified, (5.8 percent potential tax increase), resulting from normal year to year pressures. The Transition Team's report identifies actions to address $117million of the $150 million pressures and deemed the remaining $33 million worth of reductions as achievable to essentially offset the normal year to year pressures. This would result in a zero increase to the budget prior to the provincial downloading.

The Budget Committee, as its first priority, will need to focus on identifying the $33 million, in addition to reviewing the recommended $117 million in proposed savings.

(2) Provincial Downloading:

On December 12, 1997, the Province revised its estimates of the cost of downloading to the City to be $164 million. Since August, those costs had been estimated at $66 million. If the downloading had been totally revenue neutral, then the 1998 operating budget would have achieved a zero tax increase.

Council has various options available to address the downloading of costs. These options include offsetting the downloading of the $164 million by: (1) substantially reducing services and/or increasing revenues through new user fees or increased rates; (2) increasing taxes; or (3) accepting the proposed offer of assistance from the Province.

In order for Council to choose between the options, more information concerning the impact of each option needs to be developed. One of the goals of the budget review process will be to develop that information. The other important goal of the review process must be to provide an early review of the $150 million in reductions proposed by the Transition Team required to address the normal City year to year pressures.

A Phased Review:

It is proposed that a two phase review process be undertaken as detailed in Appendix A. Key to addressing the normal year to year pressures is early consideration of the work done in 1997 by the various service review teams, departments and agencies. Failure to address these proposals in a timely fashion will result in reduced savings in 1998. Therefore, it is recommended that the first phase of the process occur in late January and early February. It is proposed that the Budget Committee meet with the individual departments and agencies to review their base budgets and the proposed changes developed in 1997. Once reviewed and approved by the Budget Committee through to Council, departments can begin implementing these changes in order to ensure that the savings are realized as soon as possible in 1998.

It is recommended that Phase 2 of the budget review process focus on considering the options available to address the $164 million in pressures associated with the provincial downloading. Between now and the middle of February, departments and agencies would be required to prepare plans which would present how each area would manage a further reduction in funding. The plans would also tie into the overall plans for amalgamating the former departments. The plans would deal with the reduction in both a one year or two year time frame. Between the middle of February and March, these plans would be presented to the Budget Committee for review and to consider the merits of all of the options and to recommend a strategy to Strategic Policies and Priorities on to the April15 meeting of Council.

Staff would continue meeting with the Province to better define their offer of assistance. Specifically, the terms of the repayment plan, the conditions associated with the plan, the required savings plan, impact on the City's credit rating, the criteria for the use of the plan, etc. all need to be defined and further explored with provincial officials.

Summary:

It is proposed that Phase 1 of the 1998 budget process begin with the work of the Transition Team and with review and development of recommendations and proposals to address City budget pressures of $150 million. The work completed to date needs to continue to finalize the $150 million in savings required to meet a zero increase target for City pressures. It is proposed that Phase 2 of the budget process focus on reviewing all available options that would be necessary to address the $164 million in provincial downloading.

Contact Name:

Shaun Hewitt, 392-5174, Fax No. 392-3649,

Internet: shaun_a._hewitt@metrodesk.metrotor.on.ca

--------

Appendix A

Proposed Budget Review Process (Detailed)

Step Date Action
1 Mid January to Mid February (1) Phase 1 - Budget Committee meets to review work of the Transition Team in meeting the $150 million in City budget pressures. Recommend action to Strategic Policies and Priorities Committee where deemed appropriate to address City budget pressure of $150 million

(2) Individual budgets are presented to the relevant Standing Committees

(3) Phase 2 - Departments and Agencies prepare plans to identify methods to address the $164 million provincial downloading. The plans consider both a one and two year time frame (i.e. 1998 and 1999)

2 Mid February to Mid March Budget Committee considers plans from department/agencies and input from Standing Committees to address $164 million (Phase 2)
3 March Budget Committee hears public deputations on budget with all Members of Council invited to attend
4 Mid March to Early April Budget Committee considers issues raised through deputations, reviews the $164 million plans and other strategies. Develops proposals for Strategic Policies and Priorities Committee and Council
5 April 15 Council review of proposals





The Strategic Policies and Priorities Committee submits the following report (January 29, 1998) from the Chief General Manager of the Toronto Transit Commission:

This is in response to the request made of the TTC at the January 26, 1998, City of Toronto Budget Committee meeting. Since I do not have a copy of the minutes from that meeting, I'd ask that you forward this letter to the appropriate Committee on our behalf.

Specifically, the TTC was requested to provide details on the impact of the following:

(1) A 15 percent Cut in TTC Gross Expenditures:

The report requested details on a cut of 15 percent of gross expenses. This amounts to a cut of over $100 million (15 percent of $692 million) for the TTC Conventional system and almost $6 million (15 percent of $38.1 million) for the Wheel-Trans Budget. Presumably, the intent was for 15 percent cuts to the net TTC budgets. Cuts of that magnitude would be as follows:

($Million) 1997 Subsidy 15% Cut Balance

TTC Operating $160 $24 $136

Wheel-Trans $37.5 $5.6 $31.9

Operating

These figures are the same as the cuts suggested by the Transition Team in its August 12, 1997, letter to the TTC. Our response to these questions remain unchanged, and I have attached a copy of our August 29, 1997, response to them. In addition, I have also attached a November 5, 1997, letter to Wanda Liczyk, City Treasurer, responding to an almost identical suggestion made by her.

(2) Cut 1998 TTC Capital Expenditures from $378 Million to $300 Million:

The 1998 capital expenditures contained in the 1998-2002 TTC Capital Budget approved by the Commission on November 12, 1997, called for a total of $378 million to be spent on non-RTEP (Sheppard Subway and Wilson Yard Expansion) projects.

The Treasurer's January 19, 1998 report to the Budget Committee entitled "1998 Capital Works Program - Preliminary Targets" recommended the following changes:

1998 Capital Expenditures

Commission approved on November 12, 1997 $378 million

less:

(1) Deferral of some 1998 bus purchases (22)

(Based on advice of TTC staff)

(2) Deferral of the Queen's Quay (7)

Connection to the CNE

__________

Recommended by Treasurer $349 million

On January 26, 1998, the Budget Committee requested a report on the implication of cutting that figure to $300 million, while leaving the 1998 Sheppard Subway expenditures unchanged.

The 1996-2000 TTC Capital Program for the first time combined and prioritized all of the Commission's capital needs into one budget. Long-term, comprehensive, reinvestment plans were developed and multi-year budgets prepared based on life-cycle replacement programs, implementation of necessary safety improvements and the need to overcome the effects of previously deferred maintenance/investments.

In approving that budget, the Commission and Metro Council formally adopted the following priorities, highest to lowest, for capital spending relating to the TTC:

(i) state-of-Good-Repair/Safety;

(ii) legislative;

(iii) improvement; and

(iv) expansion.

These priorities remain unchanged to this day. The debate in the fall of 1996 on the final approval of the Sheppard Subway and the acceptance of the 5-year TTC/Metro/MTO Capital Subsidy Agreement combined both the Sheppard Subway and the State-of-Good-Repair Budget into a single budget. Both levels of government reviewed the budgets in detail and agreed in writing to fund both parts.

The 1997-2001 and the 1998-2002 TTC Capital Program both adhere to the approved priorities and represent the current rolling 5-year plan of the on-going system needs. The needs are based on the following:

(i) realistic life cycle budgets;

(ii) implementation of safety improvements; and

(iii) overcoming deferred maintenance.

As noted by Richard M. Soberman, Professor of Civil Engineering University of Toronto, in his report entitled, "The Track Ahead" for an organization with physical assets worth almost $7 billion, annual replacement costs of over $250 million plus should be set aside each and every year simply to cover the cost of replacing or rehabilitating the existing plant. The average expenditures in the 1998-2002 State-of-Good-Repair budget are:

$1.2 Billion = $250 million/year

5 years

The 1998 costs are higher because there is a very large ($143 million) payment on the contract for the delivery of the T-1 Subway cars replacing old H-1 cars.

Simply put, if the City needs to cut $50 million per year out of the TTC's capital budget, follow the capital priorities and cut the $50 million from the lowest priority.

(A copy of the letter dated November 5, 1997, referred to in the foregoing communication, was forwarded to all Members of Council with the agenda, of the Strategic Policies and Priorities Committee special meeting of February 3, 1998, and a copy thereof is on file in the office of the City Clerk.)

The Strategic Policies and Priorities Committee also submits the following communication (February 2, 1998) from the President of Canadian Union of Public Employees (CUPE) Local79:

CUPE Local 79 is the union for 12,000 members working in the former Municipality of Metropolitan Toronto, the former City of Toronto and The Riverdale Hospital.

With the creation of the new City, we are embarking on a challenge in which everyone who works and lives here has a stake. Council must ensure that citizens feel involved and committed to working together in order to tackle issues and find solutions. CUPE Local 79 representatives have a respected history of active participation in the democratic process. We have always followed the budget process with great care and vigilance because of its impact on the programs that we deliver to the public.

The Chief Financial Officer and Treasurer is recommending a two-phased approach to the budget. In fact there are three: implementing the Transition Team's reductions, cutting the remaining $33 million, and the $164 million in reductions due to provincial downloading. This will have a devastating effect on programs. Maintaining services to the community will be the greatest challenge for the new Council. We urge Committee members to reconfirm their commitment to maintaining services to the taxpayers.

Your Chief Administrative Officer has written that "employees are our greatest resource". It is the front-line employees who provide the valuable programs which are so visible to the public. We do not believe that the creation of more temporary and part-time jobs is an appropriate solution to the budget pressures. There is a value and worth to the whole community when employees are reasonably paid and fully employed. There are already too many long-term temporary employees who are without the security of a permanent position.

We fear that the estimates of proposed staff reductions seem to be growing. For those employees who wish to retire or leave the employ of the City, improved exit packages and early retirement incentives will provide an opportunity. Increased accessibility to the Voluntary Leave of Absence program and other similar programs is mutually beneficial. Effective retraining and educational opportunities are key to success in restructuring initiatives.

The former cities have invested billions of dollars in the creation of their infrastructures: they are invaluable long-term assets. Ongoing maintenance and care is required to ensure that their value is retained. Citizens are proud of the quality of our transportation, water and sewage systems.

Toronto is still vital, dynamic and growing -- we have a city that works. Throughout the 1998 Budget debates, we urge Councillors to preserve the integrity of the City's services for present and future generations.



12

1998 Interim Capital Budget - Capital Projects Requiring

Urgent Financing Approval

(City Council on February 4, 5 and 6, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends:

(1) the adoption of the recommendations of the Budget Committee embodied in the following transmittal letter (January 28, 1998) from the Budget Committee; and

(2) that the Toronto Police Service's request to acquire a new Radio Dispatch System, be referred to the Budget Committee for a report back with the 1998 Capital Budget on April 15, 1998.

Recommendation:

The Budget Committee on January 20, 1998, recommended to the Strategic Policies and Priorities Committee that the recommendations contained in the report (January 21, 1998) from the Chief Financial Officer and Treasurer, be amended to read as follows, and the report as so amended, be adopted:

(1) that Appendix "A", be amended by deleting - Project No. 9 - Vehicle Standardization, and the remaining projects in Appendix "A", (tax supported capital works) be given prior authorization in the City's 1998 Capital Budget with City Financing to be provided from the sources indicated;

(2) that Appendix "B", be amended by referring Project No. 35 - Watermain Capital Maintenance back to the Chief Financial Officer and Treasurer for report setting out a complete list of City-wide watermain realign projects, and the remaining projects in Appendix "B", (rate [own sources] supported capital works) be given prior authorization in the City's 1998 Capital Budget with financing to be provided from the agency's own sources;

(3) that the projects in Appendix "C", (transition costs and projects not recommended at this time) continue to be reviewed and refined for inclusion in subsequent and comprehensive reports to the Budget Committee; and

(4) that Appendix "D", which provides the justification pages for the projects being recommended for advance approval, be amended as follows:

(i) by correcting - Project No. A-5 - Park Land Acquisition, so that the funding for the three parcels of land is from the former City of Toronto Park Land Acquisition fund and not from the operating budget or debt;

(ii) by referring Project No. A-5(c) - Park Land Acquisition, 40 Wabash Avenue back to the Budget Committee; and

(iii) by amending Project No. A-5(b) - Park Land Acquisition, so that the sale of 219 Dufferin Street is credited to the Park Land Acquisition Fund.

The Budget Committee reports that is has requested the Chief Financial Officer and Treasurer and the Toronto Police Service to report to the Strategic Policies and Priorities Committee on February3, 1998 on Project A-8 - DSC System Upgrades as follows:

(i) tendering the Intelligence Communication Intercept System;

(ii) details of the $1.75 million; and

(iii) information regarding why this new system does not have to be compatible with the other police service communication system;

The Budget Committee also reports that with respect to Appendix "A", Project No. 9 - Vehicle Standardization, it has requested the Fire Chief to report to the Emergency and Protective Services Committee, on his plan respecting standardization of the fire vehicles, for subsequent report to City Council.

Background:

The Budget Committee had before it a report (January 21, 1998) from the Chief Financial Officer and Treasurer respecting the 1998 Interim Capital Budget and providing a list of capital projects which require urgent financing approval in advance of the 1998 Capital Budget.

--------

(Report dated January 21, 1998, addressed to the

Budget Committee, from the Chief Financial Officer and

Treasurer)

Purpose:

This report provides a list of capital projects which require urgent financing approval in advance of the approval of the 1998 Capital Budget.



Financial Implications:

These projects are, for the most part, the service areas' highest priorities and as such will not impede the Budget Committee's ability to present an affordable 1998 Capital Budget. The table below indicates the financial impact of these approvals on the 1998 capital budget situation. The Target columns are the recommended 1998 Capital Budget Targets, and the Interim columns are the amounts being recommended in this report. The net amount represents the amount which would be financed through a combination of capital from current, other internal sources of revenue, and debt.

Impact of Advanced Approvals on 1998 Capital Budget ($millions)

Target Interim

Gross Net Gross Net

Tax supported (excl. RTEP) 587 315 37 24

Rate supported/RTEP 357 63 14 0

Total 944 378 51 24

Recommendations:

It is recommended that:

(1) the projects in Appendix "A" (tax supported capital works) be given prior authorization in the City's 1998 Capital Budget with City Financing to be provided from the sources indicated;

(2) the projects in Appendix "B" (rate [own sources] supported capital works) be given prior authorization in the City's 1998 Capital Budget with financing to be provided from the agency's own sources; and

(3) the projects in Appendix "C" (transition costs and projects not recommended at this time) continue to be reviewed and refined for inclusion in subsequent and comprehensive reports to the Budget Committee.

Council Reference:

Council, at its meeting of January 6, 1998, adopted a report (December 23, 1997) from the Chief Financial Officer and Treasurer, entitled "Proposed 1998 Capital Budget Process", that outlined a timetable for committee and Council review of the 1998 Capital Budget and included a provision for the consideration of urgent financing for projects that cannot wait until the expected approval date of April 1998. Further, the Strategic Policies and Priorities Committee, at its meeting of January 19, 1998, had before it two communications from the City Clerk:

(1) dated January 13, 1998, submitting a recommendation from the January 12, 1998 meeting of the Urban Environment and Development Committee, with respect to the Transportation capital project, Bathurst Street Bridge over the Toronto Terminal Railways, south of Front Street; and

(2) dated January 15,1998, forwarding a recommendation from the January 13, 1998 meeting of the Emergency and Protective Services Committee, entitled "Radio Communications Switch for the Toronto Police Service" with respect to funding in the amount of $5 million for the replacement of radio switching equipment.

Background:

Each municipality was requested by the Transition Team in the summer, to submit a 1998 Capital Budget and Proposed Capital Works 1999 to 2002. These submissions were to be consistent with the Capital Budget submissions that each municipality would have used to start its capital budget process had there been no amalgamation. These projects were vetted by budget staff and some were subject to an approval process in their respective municipalities.

The recommended 1998 Capital Budget is scheduled to be before the Budget Committee at its meeting of March 31, 1998, for final approval by Council on April 15, 1998. However, certain projects require prior authorization of Council because of an urgent financing requirement. As such, departments and agencies were asked to submit by early January, requests for projects which, in their view, needed earlier financing approvals. There are three types of capital budget submissions in this report requesting advanced approval: those that were in the original capital budget submissions, those that are expected to be transition costs, and other. These requests were reviewed by Finance staff, through meetings with the various service areas to clarify the urgency of the requests.

Discussion:

The projects recommended for urgent financing approval are listed in Appendix A and B (tax and rate supported capital projects, respectively). It should be noted that these projects have not been vetted by any Committee of this Council due to the urgent nature of the requests. For the most part these are projects that were submitted as a part of the capital works program, would be funded in 1998 as high priority items, and have a proven need to be prior authorized.

In some cases the work is in progress and requires additional financing in 1998. In some cases the work is of an urgent nature and requires authorization now to mitigate any damages. In other cases the justification for advanced approval is to give the service area in question an early start in tendering contracts and thereby take advantage of traditionally favourable prices in the construction industry in the early part of the year.

Appendix "C" shows the balance of projects which departments and agencies requested for urgent financing approvals, but which are not being recommended at this time. These include transition projects, such as information technology investments, facility changes or fleet investments, and other projects which require further review. It is felt that more time is required to assess the need for each of these projects to confirm the quantum of funds requested, to analyze potential operating savings, to ensure that there is no duplication between projects, and to allow time for information technology staff, facility management staff and fleet professionals to further review the projects. It should also be noted that, in many cases, projects proposed by a service area involve a service delivered by another component of the corporation.

Appendix "D" consists of the justification sheets for each of the recommended projects in Appendices "A" and "B". These are based on information provided by departments and agencies.

With respect to the two items referred to the Budget Committee from standing committees via the Strategic Policies and Priorities Committee, the Bathurst Street Bridge project has been recommended in this report as part of the Bridge Reconstruction program. Transportation staff have indicated that the timing of the construction season makes early approval necessary and that design work and tender documents are complete. The Police Radio Communications Switch project was considered by the Budget Committee at its meeting of January 20, 1998, wherein the project was referred to staff for a further report. As such, that item will be considered separately and has not been included in this report.

Conclusions:

Approval of the projects in Appendix "A" totalling $37 million gross for tax supported projects will not prejudice the Budget Committee's ability to present a 1998 Capital Budget which is affordable. The total 1998 Capital Budget target for tax supported projects is $587 million on a gross basis, of which approximately $300 million is already committed from financing approvals of previous Councils. In aggregate, the addition of $37 million of advanced approvals of high priority items will have little impact on the flexibility remaining to the Budget Committee to present Council with an affordable 1998 Capital Budget. The recommended rate supported financing approvals total $14 million gross, compared with a total recommended target of $357 million.

Contact Names:

Donald Altman 392-1529 (tel.) 392-6963 (fax)

Len Brittain 392-5380 392-3649

Ross Cuthbert 396-7241 396-5677

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 1

Service Area: Arts, Culture and Heritage

Project Name: Todmorden Mills Heritage Museum and Arts Centre

Description:

Funds identified in long range capital plan for repairs/stabilization of brick roadway, a site feature dating from 1900-1920. The roadway serves as the main vehicular access to the museum and grounds. Work identified for 1998 is part of a three-year plan for the road stabilization that began in 1996.

Justification:

(i) identified for immediate capital work priority in long range capital plan;

(ii) at present, road poses risk to both vehicular and pedestrian traffic;

(iii) no alternatives exist for remedial repairs; and

(iv) long-term preservation of this original site feature requires its repair and maintenance.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Work deferred will result in negative impact to museum and arts centre users and visitors due to site disruption. Loss of program revenue would be expected due to lack of site access during peak season. Window of opportunity for road work is April 1 to 30, 1998 due to program activities and weather constraints. Potential health and deterioration of the road and higher repair costs in the future.

Project Details: $ $

Overall Gross Project Cost 130,000

(total for three-year project (1996-1998))

Previously Approved Financing 80,000

Requested Financing (for 1998) 50,000

1998

Gross Expenditures 50,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 2

Service Area: Arts, Culture and Heritage

Project Name: Marine Museum Redevelopment

Projects: $

Redevelopment 436,753

IT 34,000

Total 470,753

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 2 (a)

Service Area: Arts, Culture and Heritage

Project Name: Marine Museum Redevelopment

Description:

245 Queen's Quay West, North Building

Retrofit and installation of exhibits in the north building located on Toronto's waterfront. Heritage Toronto has been working toward the relocation of the Marine Museum from the Stanley Barracks location to the waterfront since 1988. The current facility being land-locked by parking lots limits the potential of the program. The Canada Ontario Infrastructure Works Program (COIW) funding of $1.5 million started the first phase of the project as an Interpretive Centre on Spadina Pier. Prior to construction of the new building, the Board of Heritage Toronto decided to investigate other opportunities including the purchase of the Dredge "Primrose" and, most recently, relocation to Pier4 North Building.

City Council and Transition Team approval were given in June 1997 for the redevelopment of the Marine Museum into the Pier 4 site as supported by a business plan "Re-establishment of the Marine Museum as a Waterfront Interpretive Centre on Toronto's Waterfront", prepared by the Economic Planning Group.

This request outlines City Council funding approval for 1997 and 1998 budget cycles. The Canada Ontario Infrastructure Works Program supports this project.

Justification:

This project is supported by a comprehensive Business Plan approved by the former City of Toronto Council in 1997. Work on the project is well underway and the opening day has been announced as July 1, 1998.

Consequences of deferring Project Approval (until April 1998 or thereafter):

This project is the result of a considerable investment of resources, including other former City of Toronto departments and funding from the Canada Ontario Infrastructure Works Program. Deferring completion of the project will result in loss of considerable investment, implications of not fulfilling obligations of the COIW grant, and a significant cost in termination of contracts, returning the building for use for alternate purposes, and determining the future of the Marine Museum and its collection.

Project Details: Capital Only

$000s $000s

Overall Gross Project Cost 1,329,573 (a)

Previously Approved Financing 893,000 (b)

Requested Financing 436,573

1997 1998 Total

Capital Only:

Gross Expenditures 734,844 594,729 1,329,573

External Revenues:

Federal 203,281 19,385 222,666

Provincial 203,281 19,385 222,666

Available Reserve Funding 0 0

(a) does not include restoration of the tug Ned Hanlan.

(b) phase one project costs for video, project management and exhibit work amount to $332,000.00.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 2 (b)

Service Area: Arts, Culture and Heritage

Project Name: Marine Museum Redevelopment

Description:

(I) 245 Queen's Quay West, North Building

(ii) Purchase and installation of equipment to service the connection of the relocated Marine Museum (the Pier Project) to the existing Heritage Toronto serves

Justification:

The new Marine Museum site will be opening on July 1, 1998 and a result of considerable investment of resources, including other former City of Toronto departments and funding from the Canada Ontario Infrastructure Works Program. The computerization program is required by April 1, 1998 to meet the operational and revenue targets of this heritage attraction.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Deferring completion of the project will result in loss of considerable investment, implication of not fulfilling obligations of the COIW grant, and a significant cost in termination of contracts, returning the building for use for alternate purposes, and determining the future of the Marine Museum and its collection.

Project Details: $

Overall Gross Project Cost 34,000

Previously Approved Financing 0

Requested Financing 34,000

1998

Gross Expenditures 34,000

External Revenues 0

Available Reserve Funding 0

--------



1998-2002 Capital Works Program

Capital Project Information Summary

A - 3

Service Area: Parks and Recreation

Project Name: Pool Capital Maintenance

Projects: $

Alderwood Pool 200,000

Scadding Pool 150,000

Total 350,000

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 3 (a)

Service Area: Parks and Recreation

Project Name: Pool Capital Maintenance

Sir Adam Beck Multi-use Facility - Ph. 2 (Ph. 1 in progress)

Description:

Ph. 2 of the Sir Adam Beck Multi-use Facility project involves the replacement and upgrade of the pool piping at the existing Alderwood Pool which is one component of the Multi-use Facility. In concert with replacing the piping work on the deck, drains, gutters and rails will be performed. (The renovation of the pool change-rooms and the replacement of the pool filtration system are components of Ph. 1 of the project which was previously approved as a 1997 project and is currently in progress.)

Justification:

The existing cast iron piping which is now over 40 years has corroded internally. Rust from the pipes is periodically blown into the pool affecting the water clarity/quality. The rust build-up in the pipes over the years has also decreased the flow rate of the water by 15-20 percent and as a result, the system is operating at 75-80 percent efficiency and decreasing yearly. The filtration system (mechanical room equipment) for the pool is being replaced with a high rate sand filter system as part of a previously approved project (Ph. 1). This system will provide a four-hour run over rate as required by code instead of the current 5-8 hours.

Without replacing the pool piping the benefit of replacing the filtration system and increasing the flow rate will not be fully realized as the new system will not be able to run at capacity without dislodging more rust particles and increasing the pressure on the pipes which may cause underground leaks. As well as replacing the piping, it is also proposed that the overflow gutter be replaced with a Skimmer System to prevent water from going directly to waste (estimated at 4,000 gallons daily). Installing the Skimmers, piping, inlets and a single pump system will all decrease current operating costs.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The installation of the new filtration system (Ph. 1) is the first part of a two-part project, with the piping replacement being the second part. In order to obtain maximum efficiency of the new equipment, new Skimmers, inlets and related piping are all required.

We are requesting early approval for this project in order that it can be implemented with the filtration system replacement which is being done as part of the 1997 Sir Adam Beck project.

If the pool piping replacement is deferred the pool will require a shutdown of at least six weeks on top of the 3-month shutdown which is required for the 1997 project and the related revenue will be lost.

Project Details: $ $

Overall Gross Project Cost 200,000

Previously Approved Financing 0

Requested Financing 200,000

1998

Gross Expenditures 200,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 3 (b)

Service Area: Parks and Recreation

Project Name: Pool Capital Maintenance

Scadding Court Swimming Pool Replacement



Description:

The Scadding Court site is part of program that was developed to renovate or reconstruct existing deteriorated swimming pool facilities. Scope of work entailed repair and upgrade of filtration piping and pool decking. Renovation to the small swimming pool is currently underway; the construction company is on site. This construction company has already submitted a bid price for the large pool. Funds for renovation of the large pool are being requested.

Justification:

Replacement of mechanical systems is necessary before the commencement of spring programs. Immediate processing is necessary to allow for a reasonable project timeframe to meet with program scheduling. Filtration piping is badly deteriorated. Its condition poses a flood threat to the rest of the facility.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Immediate project approval will allow for continuous service to the public and reduce threat of damage to the rest of the facility.

Project Details: $ $

Overall Gross Project Cost 150,000

Previously Approved Financing 0

Requested Financing 150,000

1998

Gross Expenditures 150,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 4

Service Area: Parks and Recreation

Project Name: Pool Expansions

Lord Dufferin Swimming Pool - PH1

Description:

Funds are required for completion of Phase 1 of the construction a replacement swimming pool facility at Lord Dufferin Public School. The Board of Education is responsible for project and construction management.

Justification:

Construction is currently in progress. Phase 1 of the project ($700,000.00) was approved by City Council and FAB recommended that funding be found within the capital budget to meet our requirements in 1997. Funds of $230,000.00 have already been committed to the project in 1997.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The pool is in very poor condition, which has resulted in numerous shutdowns. Other pools in the area are currently operating at capacity.

Project Details: $

Overall Gross Project Cost 2,500,000

Previously Approved Financing 230,000

Requested Financing 470,000

1998

Gross Expenditures

External Revenues

Available Reserve Funding

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 5

Service Area: Parks and Recreation

Project Name: Park Land Acquisition

Projects: $

TRCA 4 Wynnview Cr. 250,000

41R Dundonald 475,000

40 Wabash 175,000

Total 900,000

See attached for details

1998-2002 Capital Works Program

Capital Project Information Summary

A - 5 (a)

Service Area: Parks and Recreation

Project Name: Park Land Acquisition

TRCA 4 Wynnview Cr.

Description:

Requesting immediate approval of $250,000.00 from the Parkland Requisition Reserve in order to enable the TRCA to finalize the purchase of No.4 Wynnview Court prior to March 2, 1998 closing of the property purchase option.

Justification:

This property occupies a strategic location along the Toronto waterfront between Rosetta McClain Gardens Park and Scarborough Heights Park. The acquisition will preserve this strategic property as public land which will afford the opportunity to link the two aforementioned parks by an integrating trail.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Property could be sold to private interests which would preclude the integration of public waterfront properties and linked trail opportunities.

Access across the waterfront in this area would then rely on using roadways which poses safety concerns. It is noted that the TRCA has approved this acquisition subject to Toronto's approval to fund 50 percent of cost.

Project Details: $

Overall Gross Project Cost 250,000

Previously Approved Financing 0

Requested Financing 250,000

1998

Gross Expenditures 250,000

External Revenues 0

Available Reserve Funding 0

--------



1998-2002 Capital Works Program

Capital Project Information Summary

A - 5 (b)

Service Area: Parks and Recreation

Project Name: Park Land Acquisition

41R Dundonald Street

Description:

Funds are required for acquisition of this property. This property is immediately adjacent to existing city owned parkland and allows for the opportunity of expansion.

Justification:

This project was approved by both City Council and FAB. FAB approval was conditional on the funds being provided from the sale of city property at 219 Dufferin Street. However, the closing of this sale is delayed due to environmental concerns and is scheduled for later this year. This will be too late to comply with the closing date set out in the purchase agreement for 41R Dundonald Street which is currently February 5, 1998.

Consequences of deferring Project Approval (until April 1998 or thereafter):

High priority consequence of not completing the transaction will be that the property could be sold to another purchaser.

Project Details: $

Overall Gross Project Cost 475,888

Previously Approved Financing 0

Requested Financing 475,888

1998

Gross Expenditures 475,888

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 5 (c)

Service Area: Parks and Recreation

Project Name: Park Land Acquisition

40 Wabash Avenue

Description:

An offer of purchase has been made by the City for this property. Immediate funding of $50,000.00 is required to perform soil testing analysis. If soil testing analysis indicates the property is suitable for purchase, then a deposit of $125,000.00 will be required. Full City funding is approved contingent on the sale of a city property, however, the closing date of the sale of this other property will occur too late for needed funding

Justification:

Request for this project is to permit compliance with the contract and to make the stipulated deposit. This project was approved by both City Council and FAB.

Consequences of deferring Project Approval (until April 1998 or thereafter):

As per the purchasing agreement, the City has a 90 day decision period to assess and decide on the feasibility of this site for purchase.

Project Details: $

Overall Gross Project Cost 1,462,000

Previously Approved Financing 1,462,000

Requested Financing 175,000

1998

Gross Expenditures

External Revenues

Available Reserve Funding

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 6

Service Area: Parks and Recreation

Project Name: Arena Capital Maintenance





Projects:

$

Trinity Bellwoods 700,000

McGregor Arena 500,000

McGregor Park Recreation Centre 250,000

Total 1,450,000

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 6 (a)

Service Area: Parks and Recreation

Project Name: Arena Capital Maintenance

Trinity Bellwoods

Description:

This 35 year old artificial ice rink floor located in Trinity Bellwoods Park is scheduled for replacement in 1998 as part of a program that encompasses the long term replacement of artificial ice rink refrigeration equipment floor and floodlighting in order to reduce continuous repair and is essential for safety and to keep facilities open and usable.

Justification:

Consulting engineers have prepared a report indicating that this rink requires immediate replacement and is the #1 priority among 27 artificial ice rinks. The consultant advises that conditions at this rink constitute a public hazard. Authority to proceed is required at this time to enable construction to be completed prior to the program season.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Consequences of deferring project approval would lead to service reduction as the ice rink will not be ready for public use for the 1998/99 season. The deteriorated piping in this ammonia feed rink poses a risk of injury to staff and patrons.



Project Details: $

Overall Gross Project Cost 700,000

Previously Approved Financing

Requested Financing 700,000

1998

Gross Expenditures 700,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 6 (b)

Service Area: Parks and Recreation

Project Name: Arena Capital Maintenance

McGregor Arena

Description:

New rink boards, painting, flooring, etc. in the arena

Justification:

With the pool and (6 (c)) arena projects being completed together, the building will be fully modernized and maintenance free for years to come. Cost efficient to do this project with the main pool project.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Current maintenance costs will continue. Furthermore, if early approval is not granted the project can not take place this year so as to tie-in to the pool work currently under construction.

Project Details: $

Overall Gross Project Cost 500,000

Previously Approved Financing

Requested Financing 500,000

1998

Gross Expenditures 500,000

External Revenues

Available Reserve Funding

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 6 (c)

Service Area: Parks and Recreation

Project Name: Arena Capital Maintenance

McGregor Park Recreation Centre



Description:

Construction currently in progress. Additional funding for the pool renovation.

Justification:

Funding for the McGregor Park Recreation Centre project was reduced (by $297,208.00 as per developer agreement) from its original $3,920,000.00 Section 37 funding (see 1997 Capital Budget, Project #9270-0). It is anticipated that approximately $250,000.00 in alternative funding will be required to finance the completed project.

The source of the alternative funding for the McGregor Park Recreation Centre will come from "previously" approved Works & Environment Capital Levy by reducing the 1997 Landfill Survey Project No. 8580-0 by $250,000.00.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Reduced scope of work for the pool renovation contract which is now under construction and this is not practical.

Project Details: $

Overall Gross Project Cost 250,000

Previously Approved Financing 0

Requested Financing 250,000

1998

Gross Expenditures 250,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 7

Service Area: Police

Project Name: Migration of Mugshot System

Description:

The purpose of this project is to replace the obsolete and failing hardware used by the Service's mugshot application. This application is critical to the Service's business; it photographs individuals during the booking process; the bank of photos is then used to generate lineups, for witness viewing and suspect identification.

Justification:

The system was implemented in 1993 on NeXT hardware. This hardware has been used 24 hours a day since implementation, and is beginning to fail on a regular basis. The hardware is no longer manufactured, and a maintenance contract beyond May 1998 cannot be secured with the vendor (COMNETICS). When the contract ends, the vendor will no longer search for replacement parts for this system.

Alternative 1:

Migrate to a standard workstation with the NeXTStep operating system. The overall cost for this option is approximately $325,000.00. The risk of this alternative is that the lifespan of the NeXTStep operating system is also questionable. In addition, this system cannot be supported internally, and maintenance costs will continue (current costs are $25,000.00 per year).

Alternative 2 (recommended):

Migrate to a standard workstation with the Windows NT operating system. The cost of this option is $450,000.00, which includes workstations, the software license, and implementation services. Support for the hardware will then be available within TPS.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The vendor requires approximately six months to convert the application. The later the start date, the greater the risk of having hardware failures that cannot be resolved. Should this occur, TPS would be required to revert back to a manual process to take photographs and record descriptors of arrested persons. This would lengthen each booking significantly, and it would make it extremely difficult to use the information for suspect identification.

Project Details: $ $

Overall Gross Project Cost 450,000

Previously Approved Financing 0

Requested Financing 450,000

1998

Gross Expenditures 450,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 8

Service Area: Police

Project Name: DSC System Upgrades

Description:

The purpose of this project is to upgrade the hardware and software used for the Service's specialized Intelligence Communications Intercept System. The Intelligence Unit provides these services to all investigative units in TPS.

Justification:

The system was acquired in 1993. A maintenance contract cannot be secured past June 1998, as parts for a number of critical components are no longer available. In addition, the system cannot handle the current workload. Some investigative projects have been on waiting lists for up to four weeks. If the Toronto Police Service is to continue to provide specialized Intelligence communications services, the system will have to be upgraded.

Alternative 1:

Leave the present system intact. The system may have to be shut down shortly after June 1998 (as soon as any critical component requires replacement). TPS will have to obtain these specialized services from the RCMP in Newmarket. Each project would cost approximately 40 percent more than running it in Toronto, and the lead-time in starting each project would be increased.

Alternative 2 (recommended):

Upgrade the existing equipment. This new configuration will enable Intelligence Services to handle the TPS workload. It will also eliminate potential loss of evidence and increase efficiencies in the case preparation process. The cost of this option is $1,750,000.00. This includes the hardware, software, installation and training. The vendor has committed that maintenance costs for the upgraded system will not increase over present levels.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The vendor requires 120 days to perform the upgrade (i.e., if funding is made available by February, the project can be completed before support for the old system stops). This would limit any potential loss of functionality or data.

Project Details: $

Overall Gross Project Cost 1,750,000

Previously Approved Financing

Requested Financing 1,750,000

1998

Gross Expenditures 1,750,000

External Revenues

Available Reserve Funding

1998-2002 Capital Works Program

Capital Project Information Summary

A - 9

Service Area: Fire

Project Name: Vehicle Standardization

Description:

During 1997, the City of Toronto signed contracts for vehicles that are now under construction and can be converted to the new multi-purpose standards. Three are aerial vehicles under construction with Smeal Fire Apparatus in Nebraska. This request is to convert the apparatus to quints which will provide for more effective use and versatility across the new City. Also identified are six pumpers with Fort Garry Fire Trucks, five of which that can still be converted to rescue pumpers.

Justification:

Conversion of the above apparatus will allow for greater versatility across the new city, rather than a restricted area. The only alternative is that of not converting these vehicles. This option would restrict the assignment of the vehicles and limit the effectiveness to certain geographic areas.

Cost for the aerial conversions is $159,000.00; cost for the rescue pumper conversions is $30,000.00.

Consequences of deferring Project Approval (until April 1998 or thereafter):

If these vehicles are not converted during construction, they will be delivered as is, and in use for 10-15 years thereby delaying the City's multi-purpose concept.

Project Details:

Overall Gross Project Cost 189,000

Previously Approved Financing 0

Requested Financing 189,000

1998

Gross Expenditures 189,000

External Revenues 0

Available Reserve Funding 0

1998-2002 Capital Works Program

Capital Project Information Summary

A - 10

Service Area: Facilities Management

Project Name: Old City Hall

Description:

The Old City hall asset preservation program is a continuation of a program started in 1997 as a result of two condition surveys carried out by C.A. Ventin and Nelson Wong Architects Inc. which recommended major building systems to be reviewed and replaced as well as a program of life-cycle costing implementation to ensure longevity and the health and safety of the occupants and visitors to the facility.

Justification:

The condition surveys indicated the Old City Hall required a major investment by Metro to address deficiencies and replacement cycles to major building systems such as roofs, building envelopes, building structure, H.V.A.C. systems, fire and life safety, and mechanical and electrical systems.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Severely disadvantage the public who are required to attend Court and offices of the Provincial Court system - will jeopardize future lease revenue. Will have a serious effect on the future lease revenue; the facility will continue to deteriorate and expose the occupants and visitors to risk; will not be ready for the 1999 centenary of this important landmark. This request allows for continuation of work currently under way.

Project Details: $

Overall Gross Project Cost 5,891,000

Previously Approved Financing 1,495,000

Requested Financing 1,051,000

1998

Gross Expenditures 1,051,000

External Revenues 0

Available Reserve Funding 0

1998-2002 Capital Works Program

Capital Project Information Summary

A - 11

Service Area: Facilities Management

Project Name: Other Buildings Capital Maintenance

Projects: $

Pape Recreation Centre 20,000

Alan Gardens 80,000

666 Eglinton Ave. W. 35,000

Total 135,000

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 11 (a)

Service Area: Facilities Management

Project Name: Other Buildings

Pape Recreation Centre

Description:

953 Gerrard Street East (Pape Recreation Centre). Replace electrical panels in boiler room. Replace "rusted out" electrical panels which could potentially be unsafe. Panels currently are overheating.

Justification:

Occupant and Building Safety.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Potential for fire/accident due to present condition of panels. These panels must be removed and new ones installed in a dryer location.

Project Details: $

Overall Gross Project Cost 20,000

Previously Approved Financing 0

Requested Financing 20,000

1998

Gross Expenditures 20,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 11 (b)

Service Area: Facilities Management

Project Name: Other Building

160 Gerrard Street East (Alan)

Description:

160 Gerrard East, install fall arrest system on greenhouses and dome.

Justification:

Required by legislation

Consequences of deferring Project Approval (until April 1998 or thereafter):

Must be installed prior to start of rehabilitation work planned for 1998.

Project Details: $

Overall Gross Project Cost 80,000

Previously Approved Financing 0

Requested Financing 80,000

1998

Gross Expenditures 80,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 11 (c)

Service Area: Facilities Management

Project Name: Other Buildings

666 Eglinton Avenue West, Area Buildings and Inspection Office

Description:

Replace air conditioning

Justification:

Will not be able to provide air conditioning during upcoming summer months if early approval is not forthcoming (existing unit is beyond repair).

Consequences of deferring Project Approval (until April 1998 or thereafter):

Operational efficiency at local Buildings and Inspections Office.

Project Details: $

Overall Gross Project Cost 35,000

Previously Approved Financing 0

Requested Financing 35,000

1998

Gross Expenditures 35,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 12

Service Area: Facilities Management

Project Name: 1200 Lansdowne Avenue

Description:

1200 Lansdowne Avenue, replace pool ceiling.

Justification:

Support structure is decayed.

Consequences of deferring project approval (until April 1998 or thereafter):

Consultant's Report and recommendation to replace as soon as possible because of potential structure failure.

Project Details: $

Overall Gross Project Cost 65,000

Previously Approved Financing 0

Requested Financing 65,000



1998

Gross Expenditures 65,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 13

Service Area: Facilities Management

Project Name: Casa Loma, 1 Austin Terrace

Description:

Casa Loma, 1 Austin Terrace, masonry repairs

Justification:

Required to replace loose masonry. Consultant's reports on file.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Potential hazard to the public.

Project Details: $ $

Overall Gross Project Cost 900,000

Previously Approved Financing 0

Requested Financing 900,000

1998 Future Years

Gross Expenditures 900,000 15,200,000

External Revenues 0

Available Reserve Funding

--------



1998-2002 Capital Works Program

Capital Project Information Summary

A - 14

Service Area: Solid Waste Management

Project Name: Keele Valley Development

Description:

The Keele Valley Landfill Site is located in the City of Vaughan, and currently serves the waste management needs of the Regions of York and Durham and the new City of Toronto. Since disposal operations began on November 28, 1983, more than 20 million tonnes of waste have been landfilled. Current projections estimate that Keele Valley's capacity will be exhausted by the year 2002.

The Keele Valley Development project provides the design and construction of the infrastructure and engineered environmental controls required for the management of the 100 hectare landfill site which will contain approximately 25 million tonnes of solid waste at capacity. Activities from 1998 to 2002 include provision for site services, clay liner monitoring, inspection and maintenance of leachate collection systems, expansion of leachate recirculation systems, purge wells, odour control and water monitoring systems, as well as the progressive final restoration of completed areas of the landfill site and the borrow areas.

Justification:

Certificate of Approval requires that this work be done.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Deferring project approval until April 1998 or thereafter would result in insufficient funding for the Keele Valley Capital Works Project. Therefore, no further expenditures related to this project could be undertaken.

Failure to incur the necessary expenditures would result in this project being in contravention of the condition of the Certificate of Approval and subject to prosecution for violation of the Environmental Protection Act.

Project Details: $ $

Overall Gross Project Cost 106,046,000

Previously Approved Financing * 87,223,000

Requested Financing * 700,000

1998 Future Years

Gross Expenditures 3,712,000 14,412,000

External Revenues 0 0

Available Reserve Funding 0 0

Note: * The requested funding of $700,000.00 is in addition to the recommended funding transfer of $1,373,000.00 funding from the Recycling Project SW660 to the Keele Valley Development Project SW165. This recommended transfer was approved by the Treasurer of the Municipality of Metropolitan Toronto in December 1997.

A report requesting Council's approval of this transfer will be submitted in February 1998.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 15

Service Area: Transportation

Project Name: Bridge Reconstruction Program

Projects:

$

Lawrence/Humber 2,500,000

Bloor/Dundas 750,000

Dundas/Etobicoke Creek 1,000,000

Don Mills/Don River 2,600,000

Bathurst/Railway 2,161,173

Total 10,011,174

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 15 (a)

Service Area: Transportation

Project Name: Bridge Reconstruction Program

Lawrence/Humber

Description:

Lawrence Avenue/Humber River - East of Scarlett Road - Major Bridge Rehabilitation.

Justification:

Bridge requires major rehabilitation - elements have reached end of service life.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Work requires seven months to complete. Any delays in the schedule would affect our ability to complete the work this year.

Project Details: $ $

Overall Gross Project Cost 2,500,000

Previously Approved Financing 0

Requested Financing 2,500,000

1998 Future Years

Gross Expenditures 2,500,000 0

External Revenues 0 0

Available Reserve Funding 0 0

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 15 (b)

Service Area: Transportation

Project Name: Bridge Reconstruction Program

Bloor/Dundas

Description:

Bloor Street/Dundas Street Bridge - Major Bridge Rehabilitation.



Justification:

Bridge requires major rehabilitation - elements have reached end of service life.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Work requires five months to complete. It is important to complete this work in good weather conditions, particularly the bridge waterproofing membrane. Early contracts result in attractive prices and to delay this work would further compress an already short construction season.

Project Details: $ $

Overall Gross Project Cost 750,000

Previously Approved Financing 0

Requested Financing 750,000

1998 Future Years

Gross Expenditures 750,000 0

External Revenues 0 0

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 15 (c)

Service Area: Transportation

Project Name: Bridge Reconstruction Program

Dundas/Etobicoke Creek

Description:

Dundas Street/Etobicoke Creek - Major bridge rehabilitation work to be done in cooperation with City of Mississauga.

Justification:

Bridge requires major rehabilitation - elements have reached end of their service life.



Consequences of deferring Project Approval (until April 1998 or thereafter):

(I) Work requires six months to complete.

(ii) Scheduled jointly with City of Mississauga.

(iii) Delay in award may affect ability to complete this project before winter.

Project Details: $ $

Overall Gross Project Cost 2,000,000

Previously Approved Financing 0

Requested Financing 1,000,000

1998 Future Years

Gross Expenditures 2,000,000 0

External Revenues 1,000,000 0

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 15 (d)

Service Area: Transportation

Project Name: Bridge Reconstruction Program

Don Mills/Don River

Description:

Rehabilitation Don Mills Road/Don River and Don Mills Road/CNR Bridges south of Overlea Boulevard.

Justification:

Bridge requires major rehabilitation - elements have reached end of their service life.

Consequences of deferring Project Approval (until April 1998 or thereafter):

(I) Work requires six months to complete.

(ii) Delay in award may affect ability to complete this project before Winter.

Project Details: $ $

Overall Gross Project Cost 2,600,000

Previously Approved Financing 0

Requested Financing 2,600,000 1998 Future Years

Gross Expenditures 2,600,000 0

External Revenues 0 0

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 15 (e)

Service Area: Transportation

Project Name: Bridge Reconstruction Program

Bathurst/Railway

Description:

Bathurst Street Bridge over Toronto Terminal Railways south of Front Street.

Deck Replacement, Major Rehabilitation.

Contract recommended for award at January 12, 1998 Urban Environment and Development Committee.

Justification:

Bridge requires major rehabilitation, streetcar tracks require replacement.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Require contract to begin early February 1998 in order to reopen bridge by June 14, 1998 to handle summer traffic demands.

Construction requires all traffic including streetcars to be prohibited from using bridge between February and June 1998.



Project Details: $ $

Overall Gross Project Cost 2,161,173

Previously Approved Financing 0

Requested Financing 2,161,173

1998 Future Years

Gross Expenditures 2,161,173 0

External Revenues 908,000 0

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 16

Service Area: TTC

Project Name: Traction Power / Substation Electrical Rebuild

Description:

The Commission owns 50 substations (two of which have been decommissioned), 30 breaker rooms and rents 4 Toronto Hydro substations for the supply of both traction and AC power.

The 1998 schedule consists of design work, rebuild of TTC rented substations by Toronto Hydro forces, the design and rebuild of Warden and Islington to eliminate environmental (water and condensation) and insulation breakdown problems, and an engineering study to identify and specify additional substation overhaul requirement.

Justification:

The existing substation electrical equipment has developed defects over the years. The equipment is obsolete, and parts are not available for proper maintenance. The old units were not built according to the latest industrial and safety standards, and their operation is subject to failure.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Failure of the obsolete equipment could inhibit its normal operation, resulting in substation shutdown, potential safety hazards to maintenance personnel and disruption to revenue services.

Project Details: $

Overall Gross Project Cost 1,360,000

Previously Approved Financing 0

Requested Financing 1,360,000

1998 Future Years

Gross Expenditures 350,000 1,010,000

External Revenues 263,000 757,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 17

Service Area: Toronto Transit Commission

Project Name: Power Distribution/Electrical Systems

Projects: $

SRT Power Rail Heaters 400,000

Greenwood Yard Lighting 300,000

Security Lighting - Stations 300,000

Total 1,000,000

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 17 (a)

Service Area: TTC

Project Name: Power Distribution / Electrical Systems

SRT Power Rail Heaters



Description:

To replace the non-functioning power rail heaters which have reached their 10-year life expectancy.

Justification:

Long stretches of power rail heaters on the northbound rails are not functioning as they have reached their designed life expectancy of 10 years. This affects the operation of the system during winter when ice builds up on the rails and can make power pickup impossible thus stopping service. As a result, delays occur which in turn cause inconvenience to our patrons. The use of glycol as an alternate is not recommended, as it is not environmentally acceptable.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Continued service delays and inconvenience to patrons.

Project Details: $

Overall Gross Project Cost 400,000

Previously Approved Financing 0

Requested Financing 400,000

1998 Future Years

Gross Expenditures 200,000 200,000

External Revenues 100,000 100,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 17 (b)

Service Area: TTC

Project Name: Power Distribution / Electrical Systems

Greenwood Yard Lighting

Description:

To replace and upgrade the existing yard lighting including feeder cables. Most of the existing yard lighting was installed during the construction of the yard 32 years ago, and now is in disrepair. A lighting survey conducted by Safety Department in November 1996 concluded that lighting levels were below current industry standards and recommended the upgrading of the lighting system.

Justification:

(I) Existing yard lighting fixtures have deteriorated beyond economical repair;

(ii) Lighting levels are below TTC and Illumination Engineering Society (IES) design standards;

(iii) Lighting installations do not conform to present Electrical Safety Code and pose a safety hazard to maintenance personnel; and

(iv) Light fixtures are not energy efficient.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Reduction in service personnel safety and productivity as existing light fixtures deteriorate further.

Project Details: $

Overall Gross Project Cost 300,000

Previously Approved Financing 0

Requested Financing 300,000

1998 Future Years

Gross Expenditures 150,000 150,000

External Revenues 75,000 75,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 17 (c)

Service Area: TTC

Project Name: Power Distribution / Electrical Systems

Security Lighting - Stations

Description:

To provide security lighting at various subway stations.

Justification:

In 1997, Corporate security audits were conducted at nine stations in addition to Kennedy Station which was audited in 1996. The project should reduce the risk of security and criminal incidents at identified locations and assist customers in their ability to see and identify someone if an incident occurs.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Potential for continued security incidents against customers and employees, negative perception of security in these areas, and loss of community support in continuing audit process.

Project Details: $

Overall Gross Project Cost 300,000

Previously Approved Financing 0

Requested Financing 300,000

1998 Future Years

Gross Expenditures 150,000 150,000

External Revenues 75,000 75,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 18

Service Area: Toronto Transit Commission

Project Name: Communications

Projects: $

Security System Upgrade 40,000

C.I.S. Signpost Transmitter 355,000

Total 395,000

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 18 (a)

Service Area: TTC

Project Name: Communications

Security System Upgrade

Description:

To facilitate radio communications by installing a radio base in the Patten Building Security Pod as well as a review and upgrade of the Security Pod layout and workstation to ensure appropriate workplace conditions.

Justification:

Installation of a radio base station, to replace reliance on hand held radios, will facilitate and improve the quality of radio communications while increasing the efficiency of security operations.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Protective Security Officers at the Patten Building will continue to work in cluttered workplace, contributing to inefficiency, low employee morale and increased risk of injury.

Project Details: $

Overall Gross Project Cost 40,000

Previously Approved Financing 0

Requested Financing 40,000

1998

Gross Expenditures 40,000

External Revenues 20,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 18 (b)

Service Area: TTC

Project Name: Communications

C.I.S. Signpost Transmitter

Description:

CIS signposts are used to verify the location of surface vehicles as part of the CIS system. The purpose of this project is to upgrade the CIS 10.05 Ghz transmitting signposts to 10.5 Ghz. This will be done by retrofitting a new oscillator diode in the 714 existing transmitting signposts.

Justification:

Existing transmitting signposts are 15 years old surpassing the 10-year life expectancy of the main component - the oscillator diode. Also, due to a recent ruling by the Department of Industry, the Commission would have to pay a licensing fee of $68.00 per sign post per year or $48,522.00 per year in total if we continue to use the 10.05 Ghz frequency. It is possible the 10.5 Ghz frequency range is exempt from licensing fees and staff are in the process of confirming this with the Department of Industry. Should the ruling not be favourable, it may be necessary to withdraw this project.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Transmitting signposts will have to be replaced as they fail, causing communication disruptions for the CIS system. As well, the Commission will incur $48,554.00 licensing fees for the existing signposts per year of deferral of project.

Project Details: $

Overall Gross Project Cost 355,000

Previously Approved Financing 0

Requested Financing 355,000

1998 Future Years

Gross Expenditures 125,000 230,000

External Revenues 63,000 115,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 19

Service Area: Toronto Transit Commission

Project Name: Signal System

Projects: $

Flashing Red Aspects 1,500,000

Event Recorders at Signal Interlockings 367,000

Modifications to permit facing Route Selections 48,000

Total 1,915,000

See attached for details.

1998-2002 Capital Works Program

Capital Project Information Summary

A - 19(a)

Service Area: Toronto Transit Commission

Project Name: Signal System/Flashing Red Aspects

Description:

At the present time, a red signal aspect can have two meanings:

(i) stop and stay; and

(ii) timed signal ("grade timed")

This can be confusing to the train operators if they forget the previous signal indication.

Justification:

Implementation will improve safety, bring the existing signal system to a state of good repair and provide an appropriate migration path to Automatic Train Control (ATC) in the future.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Deterioration of the performance of the existing signal equipment, and exposure to the risk that could result from failure of vital signalling components.

Project Details: $

Overall Gross Project Cost 1,500,000

Previously Approved Financing 0

Requested Financing 1,500,000

1998

Gross Expenditures 1,500,000

External Revenues 750,000

Available Reserve Funding 0

1998-2002 Capital Works Program

Capital Project Information Summary

A - 19(b)

Service Area: Toronto Transit Commission

Project Name: Signal System/Provide Event Recorders at Signal Interlockings

Description:

Design Signal System interface for 30 interlockings, procure event recorders and modems, implementation and testing in 1998. Implementation and testing in 1999.

Event recorders are electronic devices which allow discrete information to be recorded and stored for future playback. When interfaced into the signal system, the event recorder time stamps and records the time that a change in state occurs in a signal function, thus enabling a historical record of the events occurring in the interlocking (in real time) to be saved and replayed on a Personal Computer. Presently the terminal stations (Kipling, Kennedy, Finch and Downsview) have permanently wired event recorders c/w modems at all interlocking relay rooms in the subway. Procurement and installation of event recorders at all interlockings will provide signal system operating data which can be used to analyze subway operation and provide a basis for signal system component replacement, as well as a means of accumulating data for the Facilities Management System. Implementation of event recorders at all interlockings will make subway operating data more readily available to supervisory and maintenance staff. This data will assist supervisory staff in directing maintenance personnel to areas where immediate maintenance attention can assist in avoiding delays in the subway operation, or resolving ongoing operational issues.

Justification:

Implementation will improve safety, bring the existing signal system to a state of good repair and provide and appropriate migration path to Automatic Train Control (ATC) in the future.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Deterioration of the performance of the existing signal equipment, and exposure to the risk that could result from failure of vital signalling components.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 19 (c)

Service Area: Toronto Transit Commission

Project Name: Signal System Modifications to Permit Facing Route Selection

Description:

Add facing route selection capability to the existing subway signal system at 9 interlockings located throughout the subway and provide the remote control and indication of the affected signals at Transit Control. This project will increase the flexibility of the signal system by providing the ability of staff at Transit Control to re-route trains in order to service additional platforms at times when delays occur on the line which prevent through routing to a terminal station.

Justification:

(i) increase subway reliability and headway adherence benefitting customers and ridership; and

(ii) reduces occurrence of platform over-crowding - a safety hazard.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Delayed implementation, lost opportunity savings.

Project Details: $

Overall Gross Project Cost 48,000

Previously Approved Financing 0

Requested Financing 48,000

1998

Gross Expenditures 48,000

External Revenues 24,000

Available Reserve Funding 0

Project Details: $ $

Overall Gross Project Cost 367,000

Previously Approved Financing 0

Requested Financing 367,000

1998 Future Years

Gross Expenditures 215,000 152,000

External Revenues 108,000 76,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 20

Service Area: TTC

Project Name: Finishes

Duncan Receiving Bay Modification



Description:

Converting the existing interior receiving bays at General Stores, Shipping and Receiving - Duncan Building to exterior bays by filling in existing interior bays Nos. 2 and 3, thereby relocating the loading dock edges to the exterior.

Justification:

This project will provide the extra receiving space required to effectively and safely marshall, process and distribute the increased volume of material receipts. This modification will also enable the General Stores section to achieve and maintain its dock-to-stock target for goods received and eliminate potential work-place hazards due to material congestion of the shop floor. In addition, the project will greatly reduce atmospheric pollution and will reduce collisions with overhead doors.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Delayed implementation, lost efficiency opportunity.

Project Details: $

Overall Gross Project Cost 150,000

Previously Approved Financing 0

Requested Financing 150,000

1998

Gross Expenditures 150,000

External Revenues 75,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 21

Service Area: TTC

Project Name: Equipment

Control Thermostat Replacement

Description:

Replacement of existing controls with set-back thermostats will enable proper temperature and time of operation control of HVAC equipment, resulting in heating and other related energy cost savings. Centralized control will further enable monitoring/control for better resource utilization.

Justification:

Set-back thermostats will provide proper control of temperature and time of operation to meet Occupational Health and Safety Act requirements, without wastage of heating fuel and other related energy consumption. The Commission will assume a break-even point in five years.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Wastage of heating fuel and other related energy consumption will continue, with increase in operating cost as a consequence.

Project Details: $

Overall Gross Project Cost 354,000

Previously Approved Financing 0

Requested Financing 354,000

1998 Future Years

Gross Expenditures 101,000 253,000

External Revenues 50,000 127,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 22

Service Area: TTC

Project Name: Yards & Roads

Control Troughs & Duct Bank

Description:

To replace and stabilize existing cable troughs and duct bank on the northbound mainline through Wilson Yard.

Justification:

Because of unstable soil conditions, the cable troughs for power and signals are sliding down the embankment placing the cables under stress.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Cables will break resulting in a loss of power and communications, therefore resulting in a shutdown of service.

Project Details: $

Overall Gross Project Cost 600,000

Previously Approved Financing 0

Requested Financing 600,000

1998

Gross Expenditures 600,000

External Revenues 300,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 23

Service Area: TTC

Project Name: Bridges and Tunnels

Station Leak Remediation Program

Description:

To implement a comprehensive station leak remediation program to reduce maintenance costs of structural members, station finishes, electrical fixtures and improve station aesthetics, reduce cost of claims and potential injuries.

Justification:

On average approximately $374,000.00 per annum is spent on remedial repairs to address the effects of station leakage problems (excluding claims). This station leak remediation program is necessary to ensure that water leakage problems do not cause further deterioration of expansion/construction joints, major structural member and station finishes to a point that they jeopardize the safety of the traveling public and have a negative effect on ridership due to the impacts on station appearance.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The structure and its subsystem will continue to deteriorate at an accelerated rate, compromising the safety, structural integrity of subway stations and compromising the safety of our patrons.

Project Details: $ $

Overall Gross Project Cost 1,086,000

Previously Approved Financing 0

Requested Financing 1,086,000

1998 Future Years

Gross Expenditures 593,000 493,000

External Revenues 296,000 247,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 24 (a)

Service Area: Toronto Transit Commission

Project Name: Buildings and Structures, Yonge/Bloor Platform Projection

Description:

Expenditure required to close out the project

Justification:

Request reflects project final close-out costs.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Payment of final project costs would be delayed.

Project Details: $

Overall Gross Project Cost 23,310,000

Previously Approved Financing 23,192,000

Requested Financing 118,000

1998

Gross Expenditures 118,000

External Revenues 88,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 24 (b)

Service Area: Toronto Transit Commission

Project Name: Buildings and Structures, Harvey Shop renovation

Description:

Rehabilitation of D.W. Harvey Shop to upgrade the facility to present standards. The work includes Building Structure and Systems rehabilitation as well as facility production improvements.

Justification:

Request reflects project final close-out costs.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Payment of project costs would be delayed.

Project Details: $

Overall Gross Project Cost 14,851,000

Previously Approved Financing 13,301,000

Requested Financing 1,550,000

1998

Gross Expenditures 1,550,000

External Revenues 775,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 25

Service Area: Toronto Transit Commission

Project Name: Buildings and Structures, Spadina Subway Extension

Description:

Final close-out costs associated with extending the subway north from Wilson Station to new station at Sheppard Avenue and Allen Road (Downsview Station).

Justification:

Project approved and undertaken in 1992.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Outstanding work and resolution of deficiencies identified on the project will not be addressed.

Project Details: $

Overall Gross Project Cost 123,349,000

Previously Approved Financing 123,249,000

Requested Financing 100,000

1998

Gross Expenditures 100,000

External Revenues 75,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 26

Service Area: Toronto Transit Commission

Project Name: Streetcar Overhaul, ALRV Axle Replacement

Description:

A four year project to replace all ALRV axles as a result of corrosion damage.

Justification:

See deferral impact.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Vehicles will become unavailable for service.

Project Details: $ $

Overall Gross Project Cost 2,400,000

Previously Approved Financing 0

Requested Financing 2,400,000

1998 Future Years

Gross Expenditures 600,000 1,800,000

External Revenues 450,000 1,300,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 27

Service Area: Toronto Transit Commission

Project Name: Non-Revenue Vehicles, Five Vehicles for Various Departments

Description:

This project includes:

(i) two trailers to transport skid steer loaders to various Streetcar work locations;

(ii) one crew cab pick-up truck and one van for the Signal Construction Project; and

(iii) one 3+ 3 crew cab pick-up truck for regularly scheduled and budgeted preventative, maintenance work on all bridges and the SRT.

Justification:

The current method of relocating Bobcats is time consuming and only allows for the relocation of one Bobcat at a time. Furthermore, Bobcats can be secured from theft if returned to a secured area after use each day.

As a result of work on the signal system, the construction workforce was increased and consequently so was the need for crew cabs projects.



Consequences of deferring Project Approval (until April 1998 or thereafter):

Lost opportunity for increased productivity, disruption of capital work efforts, and maintenance objectives will be jeopardized.

Project Details: $

Overall Gross Project Cost 116,000

Previously Approved Financing 0

Requested Financing 116,000

1998

Gross Expenditures 116,000

External Revenues 116,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 28

Service Area: Toronto Transit Commission

Project Name: Tools and Shop Equipment

Description:

This project covers the purchase of:

(i) the Russell Carhouse Wheel Lathe Control,

(ii) the modifications to the Roncesvalles Carhouse hydraulic hoist,

(iii) VXI Event Logging equipment,

(iv) a Freon (R134-A) recovery unit, and

(v) Pallet (skid) Racking and one PROTEMA mini-lift for Greenwood Stores.

Justification:

Justification for each of the components is as follows:

(I) the current lathe controls and associated display equipment and software malfunction on a regular basis which calls for much unnecessary and costly breakdown maintenance. Lathe downtime greatly impacts wheel maintenance scheduling, and downtime costs;

(ii) this modification will enable the carhouse to complete repairs to ALRV and CLRV streetcars which are currently transported to Harvey Shop for repair;

(iii) facilitates isolation of intermittent streetcar faults, reducing component exchanges, diagnostic time and increasing both reliability and availability of vehicles;

(iv) allows the Commission to replace the (R-12) Freon with the environmentally friendly Freon (R134-A) to comply with current legislation (Bill 189-94) and maintain a responsible corporate image;

(v) Pallet (skid) Racking addresses sustained increased demand from users which have caused increases in levels of inventory;

The Mini-Lift has become necessary since approximately 75 percent of the storage area at Greenwood involves lifting materials in lots weighing up to 200 lbs. to storage location heights of 8 feet.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Lost opportunity for increased quality and productivity of Streetcar Operations.

Project Details: $

Overall Gross Project Cost 481,000

Previously Approved Financing 0

Requested Financing 481,000

1998

Gross Expenditures 481,000

External Revenues 481,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 29

Service Area: Toronto Transit Commission

Project Name: Revenue and Fare Handling Equipment

Refurbish 525 Fareboxes

Description:

Rebuild 525 fareboxes for installation on surface vehicles.

Justification:

Fareboxes being removed from decommission surface vehicles are not suitable for installation on rebuilt vehicles. The cost of replacement with new fareboxes is more than twice the cost of rebuilding.

Consequences of deferring Project Approval (until April 1998 or thereafter):

There will be insufficient fareboxes to equip our surface vehicle fleet unless the damaged fareboxes are reinstalled as is or rebuilt to an acceptable standard.

Project Details: $

Overall Gross Project Cost 451,000

Previously Approved Financing 300,000

Requested Financing 151,000

1998

Gross Expenditures 151,000

External Revenues 151,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 30

Service Area: Toronto Transit Commission

Project Name: Computer Equipment and Software

Projects: $

Year 2000 Project 3,253,000

System Updating 2,700,000

Facilities Maintenance Project 795,000

Total 6,748,000

See attached for details.

--------



1998-2002 Capital Works Program

Capital Project Information Summary

A - 30 (a)

Service Area: Toronto Transit Commission

Project Name: Computer Equipment and Software

Year 2000 Project

Description:

The purpose of this project is to prepare all computer systems and corporate technologies for multi-century dates processing (i.e. change all 2-digit year fields to 4-digit year fields, as required).

Justification:

This project is required to keep existing computer systems functional through the year 2000.

Consequences of deferring Project Approval (until April 1998 or thereafter):

A variety of system malfunctions will occur if this project is significantly delayed.

Project Details: $

Overall Gross Project Cost 4,463,000

Previously Approved Financing 1,210,000

Requested Financing 3,253,000

1998

Gross Expenditures 3,253,000

External Revenues 1,773,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 30 (b)

Service Area: Toronto Transit Commission

Project Name: Computer Equipment and Software

System Updating (SMS/CMS/VMS)



Description:

This project involves evaluating, selecting and implementing a common work order system for maintenance of the TTC's revenue vehicle fleet. An "off the shelf" client server based maintenance application will be selected and implemented in order to replace the existing systems used to maintain subway vehicles, buses and streetcars. These systems include the Subway Maintenance System (SMS), the Carhouse Maintenance system (CMS) for streetcars, and the Vehicle Maintenance System (VMS) for the bus fleet.

Justification:

Proceeding with the implementation of an integrated vehicle work order system will eliminate the need for the Subway Maintenance System - Rehabilitation project ($1,065,000.00) budgeted in the 1997 -2001 program. Also, the forecasted operating savings of $200,000.00 annually associated with reducing the spare component inventory will still be achieved, commencing in 1999 after this new system has been implemented.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Since the current SMS and CMS systems are not Year 2000 compliant, delaying the implementation of this project may ultimately result in the need to first rehabilitate the SMS and CMS systems regardless. Valuable opportunity to development a common work order system concurrently with the new maintenance procedure manuals being developed in Operations will be missed.

Project Details: $ $

Overall Gross Project Cost 2,700,000

Previously Approved Financing 0

Requested Financing 2,700,000

1998 Future Years

Gross Expenditures 840,000 1,860,000

External Revenues 420,000 930,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

A - 30 (c)

Service Area: Toronto Transit Commission

Project Name: Computer Equipment and Systems

Facilities Maintenance System



Description:

This project involves implementing a Facilities Maintenance System (FMS) in the Electrical and Communications sections of the Signals/Electrical/Communications Department. An FMS system based on the MAXIMO software application was designed, developed and successfully implemented in the Signals section in 1997.

Justification:

This project creates the ability to track equipment failures and maintenance activities at a level according to specific equipment detail. The Coroner's Jury Due Diligence Checklist included a recommendation on the implementation of computerized systems to identify and analyze maintenance and defect trends. This recommendation is also tied into the requirement for a comprehensive, predictive and preventative maintenance practice. These issues can only be addressed by developing a work order system that capture defects, problems and maintenance activities at a detailed level.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Continued inadequate and restricted ability to monitor, document and schedule work for both the Electrical and Communications sections personnel. The opportunity to constructively reduce the number of work order backlogs in the Electrical and Communication sections will be deferred.

Project Details: $ $

Overall Gross Project Cost 795,000

Previously Approved Financing 0

Requested Financing 795,000

1998 Future Years

Gross Expenditures 455,000 340,000

External Revenues 228,000 70,000

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 31

Service Area: Parking Authority

Project Name: Electronic Parking Equipment Purchase



Description:

Purchase of electronic on-street parking equipment.

Justification:

To install meters at new strategic locations and replace obsolete mechanical meters with electronic equipment to readily facilitate rate changes and hours of operation. Electronic meters/pay and display equipment accommodate all denominations of coin as well as provide audit capabilities.

The purchase will be funded from combined reserves.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Failure to meet projected revenue targets.

Project Details:

$ $

Overall Gross Project Cost 7,000,000

Previously Approved Financing 0

Requested Financing 3,825,000

1998 Future Years

Gross Expenditures 3,825,000 3,175,000

External Revenues 0 0

Available Reserve Funding 3,825,000 3,175,000

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 32

Service Area: Toronto Economic Development Corporation

Project Name: Capital Improvements

Projects: $

Basin Street Extension 164,384

Infrastructure Improvements 25,000

63 Polson St. 15,625

Total 205,009

See attached for details.

1998-2002 Capital Works Program

Capital Project Information Summary

B - 32 (a)

Service Area: TEDCO

Project Name: Economic Development

Basin Street Extension

Description:

Western limit of existing Basin Street to Cherry Street; Don Roadway south of Commissioners Street.

Construction of one kilometre of new road and services constructed to municipal standards linking Basin Street and Cherry Street and upgrade of Don Roadway, south of Commissioners Street.

Justification:

Job creation - Construction; 78 person years; Long term: 1,815 jobs.

Creation of public access to development site and existing sites.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Delay in first phase contract award.

Delay in attraction of new investments; runs counter to marketing effort in place.

Project Details: $ $

Overall Gross Project Cost 5,166,733

Previously Approved Financing 1,766,416

Requested Financing 164,384

1998 Future Years

Gross Expenditures 1,711,700 3,233,933

External Revenues 1,711,700 3,233,933

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 32 (b)

Service Area: TEDCO

Project Name: Infrastructure Improvements

Description:

Funding for projects identified in TEDCO's Strategic Plan whose timing may change in response to market opportunities, discussion/agreements with third parties and emergency requirements.

Justification:

Infrastructure improvements to allow for new developments in response to the market; unexpected emergency repairs.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Market opportunity lost; delay in attraction of new investments. Delay in repairing damaged infrastructure; worst case, dangerous situation.

Project Details: $ $

Overall Gross Project Cost 7,938,848

Previously Approved Financing 200,000

Requested Financing 25,000

1998 Future Years

Gross Expenditures 100,000 7,838,847

External Revenues 100,000 7,838,847

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 32 (c)

Service Area: TEDCO

Project Name: Economic Development

Polson Street Building

Description:

Tenant improvements; repair and maintenance of multi-tenant building.



Justification:

Job creation - Construction: 16 person years; Long term: 40 jobs

Provision of small industrial/office space.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Delay in leasing to new tenants and/or renewing tenants; deterioration of the building

Project Details: $ $

Overall Gross Project Cost 1,348,810

Previously Approved Financing 1,296,032

Requested Financing 52,778

1998 Future Years

Gross Expenditures 15,625 62,500

External Revenues 15,625 62,500

Available Reserve Funding 0 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 33

Service Area: Toronto Harbour Commission

Project Name: Leslie St. Landfill

Description:

Construction of Leslie St. Headland.

Justification:

The T.H.C. has an ongoing obligation to develop this site.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The T.H.C. will not be fulfilling its obligation.



Project Details: $

Overall Gross Project Cost

Previously Approved Financing

Requested Financing

1998

Gross Expenditures 280,000

External Revenues 280,000

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 34

Service Area: Water Supply

Project Name: Water Connections

Description:

Supply and installation of water meters for residential, commercial and industrial customers that request a new water service at various locations throughout Scarborough. This is necessary to ensure their water consumption can be accurately registered and billed.

Justification:

Policy - To 100 percent meter the water consumption of all customers (Scarborough).

Cost/Benefit - New water services and meters are installed at the customer's request. Water meter costs are recovered through the water rates and funded by the capital budget. By tendering for all water meters required in 1998, the overall unit cost of meters is reduced due to the volume of the purchase and savings in administration of purchasing costs.

Alternatives - Not install water meters or purchase a small volume of water meters on a monthly basis at an increased cost.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Presently, SPUC has a one-month inventory of meters which will last until early February/98. Deferring approval will result in un-metered water services and customers receiving estimated water bills which negatively affects customer satisfaction, revenue collection and the cost of billing. Installing water meters has proven effective in raising customers awareness of efficient water use.

Project Details:

$ $

Overall Gross Project Cost 4,700,000

Previously Approved Financing 0

Requested Financing 350,000

1998 Future Years

Gross Expenditures 940,000 3,760,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 35

Service Area: Water Supply Program

Project Name: Watermain Capital Maintenance

Description:

Cement mortar lining of deteriorated iron mains to improve the structural integrity of the pipe and improve the quantity and quality of water transmission.

Justification:

Unlined watermains result in high iron and rusty coloured water. This can exceed standards and cause customer complaints. Also the unlined watermains can result in lower service pressures potentially affecting customer satisfaction and fire fighting ability. Replacement of the watermain is generally more expensive and only used when otherwise required.

Consequences of deferring Project Approval (until April 1998 or thereafter):

This work must be completed between March and November due to weather restrictions. Also, there are only four or five contractors presently capable of undertaking this type of work. Therefore, tendering must be done strategically and begin early in order to ensure optimal pricing. To continue with this multi-year priority program, early financing approval is required. Deferral would result in higher costs or an inability to complete the work resulting in delayed improvements to water quality and service.

Project Details: $

Overall Gross Project Cost 76,325,000

Previously Approved Financing 0

Requested Financing 6,950,000

1998

Gross Expenditures 17,721,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 36

Service Area: Water Pollution Control

Project Name: Sewer Improvements

Description:

Quantitative and qualitative flow monitoring and flow tracing for optimum efficiency. Purchase of monitoring equipment.

Justification:

Condition of Approval from M.O.E.E.

To validate intendant function.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Must commence with the start up of the facility so adjustment can be made by construction contracts, within the contracted maintenance period.

Project Details: $ $

Overall Gross Project Cost 400,000

Previously Approved Financing 0

Requested Financing 100,000

1998 Future Years

Gross Expenditures 200,000 200,000

External Revenues 100,000 100,000

Available Reserve Funding 0 0

1998-2002 Capital Works Program

Capital Project Information Summary

B - 37

Service Area: Water Pollution Control

Project Name: New Sewers

Toronto

Description:

Construction of sewers at various locations (Annette Street, Scott Street and Scott Lane).

Justification:

The funds requested for 1998 are required for the construction of sewers at various locations to improve roadway drainage and divert storm flows from the sanitary sewer system and the treatment plant. Prior authorization of funds, in the amount of $750,000.00 gross which constitutes 50 percent of the gross 1998 authorization requirement, is requested to allow for the early tender of the Annette Street Reconstruction Work.

The construction of the Annette Street sewer is required in 1998 because of defects of the sewer and the need to maintain drainage services to residents and business. The early tendering of the Annette Street project (e.g., January 1998) is necessary in order to complete the project in time to allow the scheduled road reconstruction on Annette Street to be completed in 1998.

Consequences of deferring Project Approval (until April 1998 or thereafter):

The scheduled road reconstruction on Annette Street may not be completed in 1998 if approval of the Annette Street sewer construction is deferred until April 1998 or thereafter.

Project Details: $ $

Overall Gross Project Cost 6,500,000

Previously Approved Financing 0

Requested Financing 750,000

1998 Future Years

Gross Expenditures 1,500,000 5,000,000

External Revenues 0 0

Available Reserve Funding 750,000 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 38

Service Area: Water Supply

Project Name: Engineering Studies

Description:

This project will provide a full schedule of infrastructure requirements, using emerging optimization technologies to meet long term water demands within City of Toronto and the southern part of Region of York. This will include development of a computer model of the distribution system and field calibration of the model. The model will be the basis of network analysis with optimization methods applied to infrastructure changes to identify the best solution. Also included will be a high level assessment of a Greater Toronto Area (GTA) wide water services strategy to identify potential linkages and their costs and benefits between the systems in the City of Toronto, York, Peel and Durham Regions. The study will be carried out by a consultant, managed jointly by staff from City of Toronto and Region of York. The cost of the study will be cost-shared on an equal basis with the Region of York.

Justification:

The Toronto water supply system, in its current form, is a large integrated system comprised of four (4) filtration plants, 18 pumping stations, 10 major storage reservoir, four (4) elevated tanks and 487kilometres of water main. The system provides treatment, storage and distribution of water within the City and Region of York, servicing 2.75 million people. To meet changing service demand, long term master plans, historically revised at five-year intervals, have been prepared.

The most recent of these is the 1995 Water Supply Joint Study (WSJS) completed in conjunction with the Region of York. This study addressed production and distribution requirements. Infrastructure requirements to meet demand projections to the year 2011 in the City and provide 259 megalitres per day (ML/d) average day to the Region of York were identified. The total Capital costs for the necessary work is in the order of $250,000,000.00.

Studies of this nature are driven largely by two components, the first being water demand projections, the second being modelling technologies which identify the production and distribution infrastructure necessary to meet projected demands. Projecting demands, particularly within the City, is more difficult as the traditional growth patterns are not applicable. Metro has generally seen primary development completed throughout its areas. Further, water demand in the City and the Region of York is affected by changes in level and type of employment (eg. there is less water intensive industry). The basis of the previous study, the 1995 WSJS, was for average day supply of 259 ML to the Region of York which would only meet a portion of their projected demand. Region of York long term demand projections have recently been revised downward as indicated in their long term water project Master Plan. Also, within the City, projected employment population levels have not materialized. This will likely result in less increase than previously allowed for to the Metro base demand. Also, modelling and optimization technologies have developed rapidly in recent years. This provides an opportunity to develop a more detailed system model, input of current demand projections and apply optimization techniques which analyze a very large number of options before identifying solutions. As a result of new demand projections in the Region of York and the City, coupled with new optimization technologies, there would likely be a basis for an increase to the 259ML/d volume allowed for as supply to the Region of York in the 1995 WSJS. Any change would be subject to overall cost benefit analysis and other factors.

Recent provincial legislation will result in changes to water supply within the new city area, and the formation of GTSB will provide other alternatives which may result in more effective water supply options. Specifically, the new city will allow full integration of the water supply network and the GTSB would allow interconnections to other neighbouring regions. A Joint Optimization Study would allow for this and may identify more optimum infrastructure changes than those previously identified. A high level assessment of the potential impact of GTSB interconnected services is also prudent at this time.

An alternative to this study would be to defer or cancel the study. This would require either proceeding with major planned Capital Works or deferring them until the study is completed. This would negate potential savings or result in an inability to meet demand. Also this would not proactively address issues concerning the New City and the GTA.

Consequences of deferring project approval (until April 1998 or thereafter):

Deferring the project would result in construction of less than optimal infrastructure, excessive costs or inadequate service delivery.

Project Details: $ $

Overall Gross Project Cost 2,163,000

Previously Approved Financing 1,602,000

Requested Financing 498,000

1998 Future Years

Gross Expenditures 504,000 157,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 39

Service Area: Water Pollution Control

Project Name: Wastewater Treatment



Projects: $

Ozone System 177,000

Pumps 245,000

Ventilation System 250,000

Total 672,000

See attached for details.

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 39 (a)

Service Area: Water Pollution Control

Project Name: Replacement of Ozonator

Description:

The existing ozone system is about twenty years old and is in need of replacement. The system is located in the Ozone House located above the aeration tanks. The present system consists of two 120 lbs/day units and it is proposed that one of these units will be replaced with a new 85 lbs/day ozonator. The unit can be installed by the vendor with the assistance of plant personnel. Being a sewage treatment plant near residential areas, the system is needed to treat the odorous gases given off by the aeration tanks. This will minimize the complaints about the nuisance from the nearby communities.

Justification:

In order to minimize complaints from neighbours, and threat of charges from MOEE, the odour control system is needed to treat the off-gases emitted by the aeration tanks. The present system for tanks 1 to 9 is past its useful life and is in need of replacement.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Good relationship of this facility with the neighbouring residences is of utmost importance. The reliable operation of the odour control equipment will ensure this harmony, and will minimize or eliminate encounters with MOEE enforcement personnel.



Project Details: $

Overall Gross Project Cost 137,907,000

Previously Approved Financing 91,351,000

Requested Financing 177,000

1998

Gross Expenditures 177,000

External Revenues 0

Available Reserve Funding 0

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 39 (b)

Service Area: Water Pollution Control

Project Name: Wastewater Treatment

Main Treatment Plant Pumping Station

Description:

The pumps and drives of the raw sewage pumps in the T-Building, which operate without upstream screens, are failing due to large pieces of debris going through the pumps. Some casings and impellers have been damaged by this debris. Due to their large capacity and the fact that these pumps were manufactured in Europe, the replacement and spare parts for the pumps and their drives are expensive, and their purchase cannot be accommodated under the plant operation budget.

Justification:

The five pumps in T-Building normally handle approximately 55 percent of the total incoming flow to the plant, or 100,000 m3/d. Usually, two pumps are run with two pumps on stand-by, and one pump being repaired. Large pieces of debris going through the sewer system have caused deterioration of the pumps. With a complete breakdown of the pumps, the mid-Toronto interceptor would have to be put into gravity mode, resulting in an increase in combined sewer overflow during wet weather events. This would lead to a reduction in near shore water quality.

Consequences of deferring Project Approval (until April 1998 or thereafter):

Risk of increasing the volume of combined sewer overflows due to loss of the pumps

Project Details: $

Overall Gross Project Cost 137,907,000

Previously Approved Financing 91,351,000

Requested Financing 245,000

1998

Gross Expenditures 245,000

External Revenues

Available Reserve Funding

--------

1998-2002 Capital Works Program

Capital Project Information Summary

B - 39 (c)

Service Area: Water Pollution Control

Project Name: Wastewater Treatment

Ventilation System - Biosolids Loading Facility

Description:

The project will involve the evaluation, design and installation of a ventilation system in the biosolids loading facility. The facility is used for the storage and loading of dewatered biosolids to transport trucks for removal off site. The facility is located on the south side of the incineration complex. The system will eliminate complaints from staff and the public, and eliminate potential charges from both the MOEE and MOL for emission to atmosphere and safety violations. The project will be a contract tender.

Justification:

There have been complaints by plant workers since the building started operations in the summer of 1996, as well as odour complaints by the public. The potential for a work stoppage and intervention by the enforcement authorities is present.

Consequences of deferring project approval (until April 1998 or thereafter):

The installation of an improved odour control system is the only alternative. No action option will likely cause more complaints and work stoppages, resulting in possible charges by the MOEE and MOL.

Project Details: $

Overall Gross Project Cost 514,431,000

Previously Approved Financing 510,282,000

Requested Financing 250,000

1998 Future Years

Gross Expenditures 245,000 606,000

External Revenues

Available Reserve Funding

The Strategic Policies and Priorities Committee also submits the following report (January29,1998) from the Chief of Toronto Police Service:

Subject: Capital Projects Requiring Urgent Financing Approval

Recommendation:

That the Strategic Policies and Priorities Committee receive the additional information requested for project A-8: Detective Support Command System Upgrades; and for project A-9: Mugshot system upgrade.

Background

Specific information was requested by the Budget Committee at its meeting on January 20, 1998, for Project A-8 on:

(i) the tendering of the Intelligence Communications Monitoring System;

(ii) details of the $1.75 million project cost; and

(iii) why the recommended system does not have to be compatible with other police service communication systems.

Responses to these specific questions are contained in the report that follows. The report also contains additional information about the Mugshot system upgrade project.

Intelligence Communications Monitoring System Upgrade:

Background:

The mandate of the Technical Support Section of Intelligence Services is to provide the Toronto Police Service (TPS) with lawful electronic surveillance applications in support of investigations. The investigations supported range from thefts and property damage to the criminal conspiracies of organized criminal groups. The Unit is responsible for activities which include interceptions, information storage, monitoring and transcribing, case preparation and court playback. The Unit consists of ten permanent staff and temporary staff which can number up to seventy at any given time, depending upon the workload.

Monitoring is the investigative technique of last resort; without the evidence gained from this process, there could be no charges laid in investigations that require it. In addition to the RCMP and the OPP, most large police agencies in the province have their own monitoring units.

In 1996, the Unit provided over 400 interceptions for 49 separate projects. On average, monitoring lasts approximately 60 days, resulting in 50 active monitoring projects per month. With the present configuration, backlogs can occur; some projects have had to wait up to 4 weeks for service. TPS has had to use the services of the RCMP approximately 6 times in 1997. In each case, project costs were approximately 40 percent due to the long-distance costs for the lines, and travel time required of the investigators. In addition, the Service is frequently called upon to provide this function to outside police agencies and has great difficulty meeting their demand.

The current system and equipment were acquired in 1993 (from the same vendor supplying the RCMP), to enable the Section to handle the communications technologies that were introduced at that time. It also enabled the Section, by switching from tapes to audio disks, to save over $50,000.00 annually in staff time required for transcribing.

The system is quite complex; the configurations required to accurately capture, record, and transcribe information are specialized, and much of the hardware and software has been customized or specially built to support this function.

At this time, the system is largely based on configurations that have since become obsolete. It can no longer meet the monitoring needs of the Service, and requires an upgrade if TPS is to continue performing this function. An example of the system's obsolescence is its inability to monitor digital signals that have been adopted by carriers such as Clearnet and Fido. Finally, there are some components of the system which are not year 2000 compliant.

In addition to functional obsolescence and capacity limitations, the system now also suffers from lack of serviceability. The vendor has advised TPS that as of June 1998, they will no longer be able to support a number of critical components in the system due to the unavailability of parts. These include the optical disk jukeboxes and optical disk drives, the database itself, and several components in the microcomputer (386) workstations. The system also does not have a capability for disk mirroring (real time backups), which would avoid loss of data (evidence) in the event of disk failure or corruption. There has recently been such a failure; it did result in loss of evidence which jeopardized the investigation for which the monitoring was taking place.

Alternatives Considered:

(1) Outsource monitoring services (e.g. to the RCMP): Experience has demonstrated that monitoring projects cost approximately 40 percent more than in-house costs, when the service is purchased from the RCMP. In addition, monitoring projects can be time sensitive, rendering control of priority for service a key consideration. External agencies such do not have the capacity to service the work volume from TPS.

(2) Discontinue use of monitoring: The mandate of Detective Support Command is to provide cost effective investigative support services to the organization. The implementation of this project is in keeping with this mandate, and specifically with that of Intelligence Services to provide specialized investigative surveillance support services to all units of the Service, and to other law enforcement agencies as approved by the Unit Commander. The provision of monitoring services directly supports several 1997 Corporate Goals and Objectives approved by the Police Services Board. These include enhancing public safety through strengthening of enforcement activities, co-ordination of investigative personnel, and improved crime information and analysis.

(3) Maintain the existing system as is, with its functional gaps and capacity limitations: The vendor has been approached on two separate occasions to extend the maintenance contract beyond June 1998, until June 1999. In each case the vendor has responded that there are some components of the system that simply cannot be supported beyond 1998, and that the costs of those that can approach the costs of replacement with current technology.

(4) Tender for a new system: The field of communications monitoring is highly specialized. In addition to the unique technical requirements for such a system, the tender would include the requirement to be compatible with the RCMP, to provide a seamless conversion of existing data, and to handle the volume of traffic TPS deals with. TPS is aware of those limited competing systems available on the market today and of their capabilities. TPS estimates that a complete replacement system would cost in excess of $2M. In addition, the introduction of a completely new system would require a substantial effort in staff training and in conversion of data, without any noticeable added benefit. As the tender requirements would not result in meaningful alternatives, TPS has elected not to consider a vendor change at this time.

(5) Upgrade (largely replace) the existing system: This is the recommended option based upon the Service mandate, and cost considerations.

Deliverables and Objectives:

The proposed system will meet the operational needs of the unit, and provide the following features:

(i) Voice capture;

(ii) Mirrored storage to avoid loss of data;

(iii) Restoring and transcribing facilities; and

(iv) Production of audio recordings onto compact disks for court.

TPS has detailed information on all the system components; due to the sensitive nature of this project, these details are not for public release. The information can be made available in a confidential session.

The specific objectives are to:

(i) Replace all obsolete hardware and software components with technology that will provide a minimum of a 3 year life for continued monitoring service;

(ii) Be operational no later September 1998 in order to minimize disruption potential to the existing service;

(iii) Remain compatible with the RCMP system for co-operative and redundancy capability;

(iv) Remove risks of loss of evidence currently inherent with the lack of disk mirroring; and

(v) Ensure backward compatibility with the current system to enable access to prior data sets.

Part 6 of the Criminal code (Privacy Act) states that it is against the law for someone to divulge the contents of a recorded conversation. Technical Support must be able to demonstrate that this information can absolutely not be accessed by a third party. It is essential that this system be self-contained, without direct links to other current or future TPS systems, such as Case Management. Should a future requirement arise for information integration, the underlying database technology and information protocols are compatible with existing TPS standards.

The vendor will continue to develop additional functionality and options for this system. TPS will review each of these options and those of any competing vendors as the business needs of the Technical Support Unit evolve.

Costs:

The projected Capital costs for the project, inclusive of taxes, are as follows:

Capture system, audio management system, central storage $900,000
Monitoring and transcribing workstations with audio capture software and hardware $470,000
Court playback and other recording facilities $320,000
Installation and Training $60,000
Total $1,750,000



The full cost breakdown is available in the vendor's ten page upgrade quote. The requirement for internal labour will be minimal (approximately 2 months over the duration of the project).

The ongoing maintenance of this system will not exceed the current cost of $210,000.00, which is funded out of the operational budget.

TPS is in the process of establishing a formal chargeback process to handle monitoring services provided to other police agencies. Any chargeback fees will be used to offset the maintenance cost identified above; it is expected that they will be negligible.

The upgrade of this system requires the construction, customization and low-level testing of many components. The vendor has indicated this process will require 120 days after approval to proceed. If the project is deferred, there continues to be an ongoing risk of encountering hardware failures that cannot be resolved as there is no maintenance contract past June1998. Once these failures occur, there is an immediate risk of loss of evidence; following this, the Section would have no option but to shut down monitoring services. This would have a significant negative impact on ongoing and future investigations.

Benefits:

The primary benefit of this investment is the ability to sustain a business function which is considered core to the Policing business. Should the investment be approved, there are additional benefits that the new system will provide to the work process. These include:

(i) Elimination of potential loss of evidence;

(ii) Ability to monitor newer communications technologies;

(iii) Improved efficiency in case preparation;

(iv) Elimination of 500 hours of temporary staff time for transcribing;

(v) Additional capacity to meet project demand;

(vi) Ability to provide monitoring services to outside agencies as required; and

(vii) Improved ability to meet disclosure demands.

Project Milestones:

The vendor will perform the installation, system testing, conversion, and deliver training. Within TPS, the Technical Support section of Intelligence Services will be performing user acceptance testing; the role of C&T is limited to managing the vendor on behalf of the user. Key project milestones will be as follows:

Milestone Date
Command and Board approval

Capital funding approved

Jan 1998

Feb 1998

Equipment delivery May 1998
Training May 1998
System Implementation and Data conversion June 1998
TPS acceptance Sept 1998
Project complete Sept 1998



Migration of the RICI Mugshot System

Background:

The RICI mugshot system supports a core function of the Toronto Police Service (TPS) under the authority of the Identification of Criminals Act. It captures photographs and descriptors of arrested persons during the booking process at eight central lockups across the City. This information is stored in a central database and can then be retrieved to create lineups, for witness viewing, and for suspect identification. The system captures approximately 200 images per day, which represents over 70,000 captured images each year. At present, it contains over 500,000 images, of which 300,000 are purely digital.

The Bail and Parole Reporting Centre relies heavily on the images in this system to correctly identify reportees. In addition, TPS provides hundreds of lineups each month to other polices agencies.

The system was installed in early 1992 on NeXT hardware. The implementation resulted in the elimination of 25 clerical positions (to enter physical descriptors of arrested persons), and 5 photo-processing technicians (to process the 35mm negatives).

At the time, the NeXT platform offered superior image processing; there was no equivalent functionality available on an Intel platform, which was and still is the TPS standard. Even today, there are very few vendors who offer this type of functionality for a police organization that processes over 70,000 images per year.

NeXT hardware has since become obsolete; it is no longer manufactured and component parts are consistently failing. The only company in North America still willing to provide maintenance for this hardware can now only locate replacement parts with great difficulty; as a consequence TPS can no longer secure a maintenance contract beyond May, 1998. When there is a hardware failure, divisions must go to one of the other lockups (which already have a full workload) until the component can be replaced. Extra officers must be mobilized for prisoner transportation. In addition, the wait at the booking station can prevent prisoners from reaching court on time, which impacts court procedures.

In addition to resolving the reliability issue, the proposed upgrade will also enable other benefits to be realized. Although the software has the functionality TPS requires, much of this (e.g., generating lineups) remains a centralized function due to the limitations of the hardware and operating system. Divisions are therefore required to process all mugshots through Forensic Identification Services located at Police Headquarters. This process is extremely inconvenient and time-consuming for both police officers and witnesses.

Alternatives Considered:

(1) Shut down the present system: TPS is required by the Identification of Criminals Act to photograph offenders charged with indictable offenses and dual procedure offenses. To continue this function, TPS would have to revert to a manual photography system using 35 mm cameras. In addition to the loss of functionality, this would be a very costly option; new photographic equipment and supplies would cost at least $200,000.00; 30 additional staff would be required for an annual cost of $1,200,000.00; training in the manual process would take up 480 person days of operational staff. It is not known at this time whether the 300,000 digital images could even be converted to negatives or whether they would be lost.

(2) Tender for a new Mugshot application: TPS is aware of the few competing systems that are available on the market. The RICI system meets the functional requirements of this organization. Regardless of the system acquired, there will be a workstation cost of $250,000.00 to replace the NeXT workstations. A new system would require the replacement of all components of the application, not just the portion that runs on the desktop. There would be a substantial effort required to convert all the current data, and to retrain the staff, without any noticeable added benefit. As a result, TPS has elected not to consider a vendor change at this time.

(3) Migrate the application to a standard workstation with the NeXTStep operating system: The cost for this option is approximately $325,000.00 for workstations, software licenses, and installation services. Support for the operating system would have to be provided externally, as it is not known at all to TPS. In addition, the lifespan of the NeXTStep operating system is itself questionable. Both the industry in general and the system vendor are adopting NT as a standard. This could only be an interim step.

(4) Migrate to a standard workstation with the Windows NT operating system. The cost of this option is $450,000.00, which includes workstations, the software license, and implementation services. There is no change required for the current server or database hardware or software. Support for the hardware and the operating system will then be available within TPS. This is the recommended option, based on cost considerations and the requirements of the Service.

Deliverables and Objectives:

The project will:

(i) upgrade the client portion of RICI (the part of the application that runs on the desktop) to run under the NT operating system, which is the standard desktop operating system of the new City;

(ii) replace all NeXT workstations ( in the Forensic Identification Unit and in the central lockups) with standard workstations that have enhanced video cards for image processing (supplied by the TPS vendor of record); and

(iii) leave the hardware and software used for the for the server and database intact, as they are not affected by this upgrade.

The proposed upgraded system from the vendor will enable lineups to be created directly at the central lockups. Further, as the RICI mugshot application will be converted to run under the Windows NT operating system on a standard workstation, support can readily be provided by internal Computing and Telecommunications staff. These workstations will then be part of the Lifecycle Management Program, under which workstations are actually leased and regularly upgraded.

This will represent a savings of approximately $25,000.00 per year in hardware maintenance costs, which were funded out of the operational budget.

The workstations running the Mugshot application will then be able to use other standard software available at TPS.

Costs:

The projected Capital costs for the project, inclusive of taxes, are as follows:

Replacement workstations $250,000
Software conversion $125,000
Implementation Services $75,000
Total $450,000



The vendor is prepared to deliver a system ready for user acceptance testing in June 1998 conditional on an early February approval to proceed. If the project is deferred, there continues to be an ongoing risk of encountering hardware failures that cannot be resolved as there is no maintenance contract past May 1998. Once these failures occur, as TPS is required by law to provide this function, there will be no option but to have to immediately move to implement alternative 1 (i.e. purchase photographic equipment and supplies, hire temporary staff, etc.) at a significant cost to the organization.

The RICI mugshot system is in its sixth year of operation; it is anticipated that this investment should provide TPS with another five years of functionality.

Project Milestones:

The vendor is responsible for the client software migration. TPS is responsible for hardware acquisition, user acceptance testing, implementation and training. Key project milestones will be as follows:

Milestone Date
Command and Board approval January 1998
Capital funding approval February 1998
System delivery June 1998
User Acceptance Testing July 1998
Implementation and Training September 1998
Project complete September 1998



The Strategic Policies and Priorities Committee also submits the following report (February2, 1998) from the Chair of the Budget Committee:

Subject: Toronto Police Service Request to Acquire a New Radio Dispatch System

Purpose:

To consider the above-noted request within the context of the City's 1998 Capital Budget.

Recommendation:

That the matter of the acquisition of a new Radio Dispatch System for the Toronto Police Service be referred to the Budget Committee for a report back with the 1998 Capital Budget on April 15, 1998.

--------

Councillor Rae, (Ward 24 - Downtown), declared his interest in the foregoing matter insofar as it pertains to 41R Dundonald Street, "Capital Project Information Summary" - A - 5(b), as he resides in close proximity to the subject property.

(Councillor Rae, at the meeting of City Council on February 4, 5 and 6, 1998, declared his interest in that portion of the foregoing Clause pertaining to Project A-5(b) - Park Land Acquisition - 41R Dundonald Street, as he resides in close proximity to the subject property.)



13

Other Items Considered by the Committee

(City Council on February 4, 5 and 6, 1998, received this Clause, for information.)

(a) City of Toronto Administrative Structure

The Strategic Policies and Priorities Committee reports having received the following transmittal letter:

(i) (January 29, 1998) from the City Clerk advising that the Special Committee to Review the Final Report of the Toronto Transition Team on January 28, 1998, amongst other things, concurred with Recommendation No. (2) embodied in the report dated January 22, 1998, from the Chief Administrative Officer, viz:

"(2) this report be forwarded, for information, to a special meeting of the Strategic Policies and Priorities Committee to be held prior to the February 4, 1998, Council meeting."

(b) Motion - No Increase in Taxes for three years

The Strategic Policies and Priorities Committee reports having referred the following transmittal letter from the Budget Committee back to the Budget Committee for consideration as part of the 1998 budget process:

(i) (January 28, 1998) from the Budget Committee recommending:

(a) that the motion from Councillors Minnan-Wong and Mammoliti requesting that there be no increase in taxes for three years and that a public referendum be held before increasing the mill rate, which City Council at its meeting on January 2, 6, 8 and 9, 1998, referred to the Budget Committee for consideration, be received; and

(b) the Budget Committee establish as an objective for the 1998 Budget a "zero" tax increase with maintenance and protection of all current levels of service to the public, subject to the reality of provincial operating and capital downloading.

(c) Ratification of Senior Staff

The Strategic Policies and Priorities Committee reports having recommended to City Council the adoption of the following report (February 2, 1998) from Mayor Mel Lastman:

(i) (February 2, 1998) from Mayor Mel Lastman recommending the ratification of senior staff.

Respectfully submitted,

MEL LASTMAN,

Chair

Toronto, February 3, 1998

(Report No. 2 of The Strategic Policies and Priorities Committee, including additions thereto was adopted as amended by City Council on February 4, 5 and 6, 1998.)

 

   
Please note that council and committee documents are provided electronically for information only and do not retain the exact structure of the original versions. For example, charts, images and tables may be difficult to read. As such, readers should verify information before acting on it. All council documents are available from the City Clerk's office. Please e-mail clerk@city.toronto.on.ca.

 

City maps | Get involved | Toronto links
City of Toronto 1998-2001