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City of Toronto




REPORT No. 4

OF THE STRATEGIC POLICIES AND PRIORITIES COMMITTEE

(from its meeting on April 7, 1998,

submitted by Mayor Mel Lastman , Chair)




As Considered by

The Council of the City of Toronto

on April 16, 1998




1

Appointment of Commissioner of Economic Development,

Culture and Tourism



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the confidential communication (April 9, 1998) from the City Clerk respecting the appointment of the Commissioner of Economic Development, Culture and Tourism, which was forwarded to Members of Council under confidential cover.



(City Council on April 16, 1998, had before it, during consideration of the foregoing Clause, the following confidential communication (April 9, 1998) from the City Clerk:



The Strategic Policies and Priorities Committee, at its in-camera meeting on April 7, 1998, recommended to Council that:



(1) Mr. Joseph A. Halstead be appointed Commissioner of Economic Development, Culture and Tourism for a period of three years from the date of Council approval;



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



(3) authority be granted for the introduction of the necessary Bill in Council.)

2

Voluntary Separation Program for Bargaining Unit Employees



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 2 of Report No. 4A of The Strategic Policies and Priorities Committee.)





3

Manson Property at 5421 Lawrence Avenue East



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the confidential transmittal letter (March 11, 1998) from the Budget Committee, respecting the Manson property at 5421 Lawrence Avenue East, which was forwarded to Members of Council under confidential cover.



(City Council on April 16, 1998, had before it, during consideration of the foregoing Clause, the following report (February 6, 1998) addressed to the Scarborough Community Council, from the Commissioner, Scarborough Works and Environment Department:



Purpose:



To identify a process that is private and/or public that will ensure the early and safe demolition of the existing industrial building on the Manson property located on Port Union Road and Lawrence Avenue East in Scarborough, and also to address the issues of site remediation and future land use. The property's address is 5421 Lawrence Avenue East, and is approximately 9.3 hectares in size.



Financial Implications:



The question of funding from City reserves or accounts is addressed separately in a confidential report which is to be considered as Part II of this report.



Recommendations:



That this report be forwarded to Budget Committee as part of the 1998 Corporate budget process and considered in conjunction with Part II. Further, all further reporting be through the Commissioner of Urban Planning and Development.





Background:



Scarborough Council, at its last meeting in 1997, directed the Acting City Manager to report in January 1998 on what action the City can take to expedite the safe demolition of the building and cleanup of the property.



The site at 5421 Lawrence Avenue East, known as the Manson site and formerly as Johns Manville, was opened approximately 50 years ago in February 1948 as a plant for the production of asbestos-related materials. The plant ceased production in February 1995. It is known that the existing building and site contain asbestos material which will require considerable remediation. The land is actually owned by a company that is in receivership and all activities on the site are controlled by the mortgage holder, Penfund Management Limited. Penfund has hired a firm known as Parallel Management Inc. to work with potential developers and identify what work needs to be done on the site, in the short term to ensure that it is secured and safe, and in the long term to address the question of remediation and development. Penfund has an agreement with Yellow Moon Homes (the Conservatory Group), that requires decommissioning of the site and demolition of the building to create a land parcel ready to accept residential land redevelopment.



Yellow Moon Homes had submitted a Zoning By-law change and a Plan of Subdivision which the previous City of Scarborough Council turned down and, as a result, the developer has proceeded to the Ontario Municipal Board for a ruling on their application.



Currently the building is boarded up, the site is fenced off with a chain link fence, and security patrols check the site periodically.



Discussion:



There are several activities going on in the general area surrounding the Manson site that are related to development by the private and public sectors. The Toronto Region Conservation Authority is now proposing to create a waterfront park and are undertaking an environmental assessment at the Port Union Road/Lake Ontario area. The Conservation Authority is buying land that is needed for the waterfront park and the Manson property incorporates a water lot into Lake Ontario which is needed for the Conservation Authority work. The Conservation Authority would like to start work in the fall of 1998, and need to either acquire or expropriate the particular property that is associated with the Manson site. It should be noted that the water lot is not part of the Subdivision Application.



Scarborough Council approved a project known as the Port Union Village Common which is the creation of a Village Centre around an access road to the Lake Ontario waterfront under the CNR tracks. The land necessary to create the Village Common was to be obtained through both land acquisition and by dedication through Plan of Subdivision, part of which was to come from the Manson lands. The City has been negotiating and has acquired the Baker property on the east side of Port Union Road for the Village Common project that was to be matched on the west side of Port Union Road by lands dedicated from the proposed Plan of Subdivision on the Manson lands. There is still property to be acquired on the east side of Port Union Road. See attached plan.

In the latter part of 1997 servicing for a development on the east side of Port Union Road necessitated constructing a sanitary sewer across the southerly portion of the Manson property in an easement, and this involved the removal of asbestos encountered within the limits of the sewer easement.



(1) Community Concerns:



Given the fact that the surrounding communities were very concerned regarding the existence of asbestos in the building and in the ground on the Manson lands, a meeting was arranged in the community on January 19, 1998 to hear the concerns from the three community associations that represent the area, namely the West Rouge Community Association (WRCA), the Centennial Community Recreation Association (CCRA), and the Port Union Village Homeowners Association (PUVHA).



The WRCA would ideally like to see all of the land turned into a park, however they agreed that it does not seem likely. They would like to see the City, the Province, and the Federal Government join forces and take the Manson lands under collective stewardship. They would be prepared to see a section along Lawrence Avenue East used for retail uses to provide a tax base. Secondly, a parking lot should be constructed to service the Village Common and the lakefront development, and lastly, the most polluted portions of the Manson property should be covered in 1.7 metres of soil and just used for park purposes. The WRCA is opposed to residential housing going into any area of the Manson site.



The CCRA acknowledges that it is very unlikely that all of the lands will be turned into park, and that the issue of back taxes and cleanup costs make this a complicated issue. They would like to see the City carry out a baseline audit of the lands to determine a contingency plan and determine which areas of the site can be cleaned up and which areas of the site should be left alone. Their major concern is with public safety, during the current situation with the existing boarded-up building, during the demolition of the building, and during the cleanup of any of the remaining lands. They acknowledge that more retail outlets are needed within their community, and therefore it is possible that the Lawrence Avenue frontage of the Manson site could be used to create this type of development and thus generate funding from the sale of the land and the development which would offset the cost of purchase. Their preference would be for the City to become the stewards of the land through whichever means possible so that the demolition process is controlled totally by a level of government.



The PUVHA would ideally like to see all of the lands used for park, however their main concern is that they do not wish to see the empty factory remaining on the site for the next three or four years. Their feeling was that if a park is not realistic and waiting for it to happen means that the empty factory remains, then they would like to see the land developed so that an early demolition of the building can be achieved.



There are general concerns that the building is old and falling apart, and if any part of the building does collapse then asbestos dust could be freed into the atmosphere and distributed throughout the community. They wanted assurance that the City would be able to take steps to have the building secured and safe and, if necessary, carry out the work itself and bill the landowner.



On January 26, 1998 there was a fire in part of the old existing factory which clearly indicates that the building is a safety hazard in the community and that as far as the public is concerned, the sooner the building is safely demolished, the better.



The community was adamant that there needs to be a methodology for communicating activities for upcoming steps in the process to not only the Community Associations but also to the general public in the area. Similarly, they felt there should be a liaison or ad hoc committee created to address the future uses of the Manson property should it come under the stewardship of the City, and failing that, to address the development proposals and timing by any potential developer.



The CCRA also put forward the suggestion that if the City was to obtain ownership of the site, then the proposed location of the Village Common could be moved westerly onto the Manson property and therefore save any future acquisition costs for the Village Common that were to have occurred on the east side of Port Union road.



To ensure there is continued communication between the community representatives and the City, it was agreed that a meeting will be held on February 23, 1998, at 7.30 p.m. in the Port Union Community Centre Library and that this committee would be called the Manson Site Liaison Committee. It is proposed that the City staff contact person for this project be Lorne Ross, Interim Functional Lead - Planning.



(2) Future Actions:



The developer, Yellow Moon Homes, has taken the application to the OMB, however, no date has been set for the preliminary hearing and therefore there is no indication at the present time as to when a decision will be made by the OMB. The mortgage holder, Penfund, has indicated that they will only spend money developing the site when they know there is approval for the development application. They will not, therefore, pursue the demolition of the building and its associated studies and procedure until they know there is a development approved. Similarly, Penfund will not spend any more money addressing the cleanup of the site to whatever degree required until they know that there is a development that can proceed in order to ensure a return on any investment in site cleanup.



While the existing mortgage owner and their agreement with the developer, Yellow Moon Homes, contemplates residential and commercial development on the site, nothing is proceeding at the moment and presumably until there is an OMB decision, there is always the possibility for other applications to be brought forward.



(3) City of Toronto Involvement in the Process



When the private sector proposes development of land, the municipal level of government gets involved in the planning process, and the servicing of the proposed land use, all as prescribed under the Planning Act. In this particular case the City did not approve the proposal presented to it and therefore the applicant can either submit a revised development proposal or wait for an OMB decision on the current proposal. The City of Toronto would also approve and issue demolition permits for the existing factory building, and while an application was originally submitted by Penfund, no further action is contemplated until they are sure that development can proceed. The City would be retaining, at the developer's expense, a qualified consultant for a peer review of the proposed demolition process and appropriate site cleanup. The Ministry of the Environment will be involved in the remediation plan and the demolition of the existing Manson buildings. To this effect the Ministry of the Environment has written to City staff requesting that they be advised of any action proposed on the site so that they can be involved at the appropriate time.



The City can play one of two roles in the future of the Manson site. It can continue to play a reactive role to whatever happens on the site and use existing legislation and by-laws to control the process and ensure that any work is carried out safely and in accordance with all appropriate legislation. Alternatively, the City can take a proactive approach and attempt to obtain control of the land so that it will be totally responsible for the demolition of the buildings and the cleanup to whatever degree necessary on the remaining part of the Manson site. Whichever option is chosen, there is definitely a need to coordinate with, and communicate to, the residents and businesses that are within the community impacted by any activity on the Manson site.



Conclusions:



As indicated in more detail in Part II of this report, I believe that the City of Toronto should initiate steps to take a proactive approach to solving this issue in the West Rouge Community. It is proposed that Planning staff will take over the role of communicating with the Associations and residents, as well as being the lead contact for the Manson Site Liaison Committee.



Contact Name:



Michael A. Price, P. Eng., FICE, Commissioner, Scarborough Works and Environment,

Telephone: 396-7139, Fax: 396-5684, e-mail: price@city.scarborough.on.ca.)



(Extract from Part II of the confidential report dated February 6, 1998,

addressed to the Scarborough Community Council

from the Commissioner, Scarborough Works and Environment Department.)



Recommendations:



It is recommended that:



(1) the Scarborough Community Council recommend that the City of Toronto take a proactive position to acquire the total Manson property at 5421 Lawrence Avenue East through the initiation of the tax sale process;



(2) that appropriate staff, under the direction of the Commissioner of Urban Planning and Development, report further on the next steps in the process and the estimated cash flow for the scheme; and



(3) that this report, along with Part 1, be forwarded to the Budget Committee to be considered as part of the 1998 Corporate budget process.



(A copy of the Location Plan, referred to in Part I of the foregoing report, is on file in the office of the City Clerk.)



(City Council also had before it, during consideration of the foregoing Clause, the following confidential communication (March 11, 1998) addressed to the Strategic Policies and Priorities Committee, from the City Clerk:



Recommendations:



The Budget Committee on March 9, 1998, recommended to the Strategic Policies and Priorities

Committee, and Council that:



(a) the confidential report (February 6, 1998) from the Commissioner, Works and Environment, Scarborough be adopted subject to recommendation (2) being amended to read as follows:



"2. that appropriate staff, under the direction of the Commissioner of Urban Planning and Development, report further on the next steps in the process and that the land use study be carried out in consultation with the local community associations;";



(b) if the City obtains ownership of this land, it become a corporate asset until it is determined how much is required for the park and what can be sold; and



(c) the Commissioner of Corporate Services report to the Strategic Policies and Priorities Committee at a future date on the rehabilitation process and cost of this activity.



Background



The Budget Committee on March 9, 1998 had before it the following:



(a) letter of transmittal (February 26, 1998) from the City Clerk advising that the Scarborough Community Council, on February 18, 1998, recommended to the Budget Committee, and Council, approval of the following:



(i) (February 6, 1998) report from the Commissioner, Works and Environment, Scarborough, recommending that this report be forwarded to the Budget Committee as part of the 1998 Corporate Budget process and considered in conjunction with Part II; and further, that all reporting be through the Commissioner of Urban Planning and Development Services; and



(ii) (February 6, 1998) confidential report from the Commissioner, Works and Environment, Scarborough, respecting the foregoing; and



(b) facsimile (March 5, 1998) from Mr. David W. Collins, Penfund Management Ltd., regarding a brief summary of some of the financial benefits of developing the Manson site and requesting deferral of the item.



The Scarborough Community Council reports, for the information of the Budget Committee, having directed that the Interim Lead, Real Estate, Scarborough, continue negotiations with the owners of the other properties involved in the Village Common issues.



Councillor Ron Moeser, Scarborough Highland Creek, appeared before the Budget Committee in connection with the foregoing matter.)



(City Council also had before it, during consideration of the foregoing Clause, the following communication (February 26, 1998) addressed to the Budget Committee, from the City Clerk:



Recommendation:



The Scarborough Community Council on February 18, 1998, approved the following reports:



(1) (February 6, 1998) from the Commissioner, Works and Environment, Scarborough, recommending that this report be forwarded to Budget Committee as part of the 1998 Corporate Budget process and considered in conjunction with Part II; and further, that all reporting be through the Commissioner of Urban Planning and Development Services; and



(2) (February 6, 1998) confidential report from the Commissioner, Works and Environment, Scarborough, respecting the foregoing.



The Scarborough Community Council reports, for the information of Budget Committee, having directed that the Interim Lead, Real Estate, Scarborough, continue negotiations with the owners of the other properties involved in the Village Common issues.



Background:



The Scarborough Community Council had before it a Part I report, dated February 6, 1998, from the Commissioner of Works and Environment, Scarborough, and a Part II, confidential report, dated February 6, 1998, from the Commissioner of Works and Environment, Scarborough, respecting the Manson Property at 5421 Lawrence Avenue East.



Mr. William A. Dempsey, Honorary Secretary, Centennial Community and Recreation Association, appeared before the Community Council in connection with the foregoing matter.)



(City Council also had before it, during consideration of the foregoing Clause, communications (April 9, 1998 and April 15, 1998) from Mr. J. P. Beber, Levitt, Beber, Barristers and Solicitors, on behalf of 1144070 Ontario Limited, the owner of 5421 Lawrence Avenue East, Scarborough, requesting City Council to defer consideration of this matter in order to permit his client to make a deputation to the Strategic Policies and Priorities Committee.)





4

Funding Request - Conditions of Mount Royal Park, Montreal,

Quebec Following Ice Storm



(City Council on April 16, 1998, struck out and referred this Clause back to the Strategic Policies and Priorities Committee for further consideration.)



The Strategic Policies and Priorities Committee recommends that:



(1) a grant in the amount of $10,000.00 be provided to the City of Montreal to assist in repairing the damage to Mount Royal Park in Montreal caused by the ice storm;



(2) the grant be deemed to be in the interests of the Municipality;



(3) the necessary funds be provided in the 1998 Operating Budget; and



(4) the Chief Administrative Officer report to the next meeting of the Strategic Policies and Priorities Committee on a policy to guide City Council in responding to disaster situations and providing emergency relief to areas in Canada and/or around the world.



The Strategic Policies and Priorities Committee submits the following communication (Undated) from Nancy Loewen, President and Director, Construction Volunteers Canada, Bénévoles Canadiens du Bâtiment:



Mayor Mel Lastman, City Council, City Administration, members of the general public and media, Good Day. It is good to be back in Ontario after volunteering in Quebec 3 weeks. While I was in Quebec, I stayed in the home of the Mayor of St. Valentin, a community without power for 29 days. It is hard to imagine how these people coped. We are returning to Ontario with a gift from the Mayor of St. Valentin, maple sugar made in a sugar shack for Mayor Lastman. My name is Nancy Loewen, and I am President of a newly-formed charitable organization called Construction Volunteers Canada. I wear many hats including a construction hard hat. I would like to introduce to you one of our 250 construction volunteers, Mr. Al Miley of Al Miley and Associates, tree experts from Markham, Ontario. Mr. Miley and 17 volunteers volunteered in the ice storm in the outskirts of Ottawa. Mr. Miley and two of his climbers recently completed volunteer work in two townships in Quebec. They have seen first-hand the massive destruction not only in Ontario, but also in Quebec.



Another tree arborist from Tree Specialists, Oakville, and myself toured Mount Royal Park in February of this year. Try to visualize oaks in the picnic area of the Park split right down the middle. Visualize the Park's cemetery trees smashed, flowers and dirt on the grave sites overturned, and the Park's wildlife bird sanctuary in ruins. The Tree Specialists was the second volunteer placement in the Park. Prior to them, we placed Juret Construction and an additional volunteer from Toronto in the Park. Our organization has offered assistance to the Salvation Army, E.M.O. (Emergency Measures Ontario), Army, O.P.P., Centre de Coordination de la Sécurité Civile du Québec and many churches throughout Quebec and Ontario. Note: Attachment letter from FCM, their quote "its restoration is a cause warranting support".



We are requesting as a token of unity, generosity, compassion and environmental concern, that the newly amalgamated City of Toronto, as the largest City in Canada and one of the leaders in innovative environmental projects, assist our historical City of Montreal by:



(a) Contributing a donation in the amount of $10,000.00. Because of the implications relative to tax hikes in the new City of Toronto, Construction Volunteers Canada will make every effort to contribute towards the $10,000.00, with Mount Royal Park fundraisers in the New City of Toronto. Our combined donation can be forwarded to the City of Montreal (Ville de Montreal) attention Pierre Bourque, Mayor. The Mayor is an ex officio member of a charity called "Friends of the Mountain, Montreal". This charitable group, whose goal is to protect Mount Royal Park, is trying to raise one quarter of $20 million. The Park is visited by approximately four million people yearly.



Our organization Construction Volunteers Canada has high praise for "Friends of the Mountain". Their high goals are to be commended. However, as with any charity there is no certainty as to the collection of the full proceeds. Because the senior levels of government are involved in several ice storm related matters in Ontario, Quebec and the Maritimes, and the City of Montreal does not have all the financial resources expected, the private sector is trying to raise a significant amount of money. Mount Royal Park is viewed as a historical landmark by people from all over the world who visit it on a repetitive basis.



Note: Because I will be out of province again for approximately one and a half months, volunteering in the aftermath of the ice storm, we are asking the request for a donation be earmarked for budget consideration.



(b) Carefully reviewing funding for ice storm relief in Ontario, Quebec and the Maritimes and if the funding is deemed insufficient or slow forthcoming, that the City of Toronto show leadership and expedite funding by lobbying senior levels of government, especially with respect to the trees which have suffered trauma. (In order to ensure that the wounds created by the ice storm will not decay, it is vital that the correct pruning cuts are made to reduce the amount of decay and this be carried out quickly to ensure survival of our once spectacular trees).



(c) When the City of Toronto reviews the issue of twinning in the amalgamation process, that if the City of Toronto is not twinned with Montreal, they consider twinning with the City of Montreal in their time of crisis, in an effort to promote good will and share resources.



An example of good will and support was expressed during our stay in St. Valentin, Quebec, when St. Valentin's twin sister City from Japan sent delegates to St. Valentin during the ice storm.



We have been told by Friends of the Mountain that Japan has recently made a donation for Mount Royal Park.



In closing, our people worked two months during the ice storm of 1998 and are exhausted, but happy and fulfilled because they derive energy from the disaster victims who encourage and inspire them to promote good will. Because of the positive feedback, I intend to devote the rest of my life to this charity to support our fellow Canadians. I am very proud of our construction crews who never complained when the "going got tough" in complicated and dangerous surroundings.



We are not finished working the ice storm project, and delaying the donation is agreeable to our organization, because we will be returning to help the Quebec farmers, and we are also offering assistance to western New Brunswick. As pointed our earlier in the report, I wear many hats including a construction hard hat, therefore, I will be out of province for approximately one a half months. This should give the Budget Committee plenty of time to review our financial request.



Sincerely on behalf of our Directors and Membership.



The Strategic Policies and Priorities Committee also submits the following communication (March 20, 1998) from Mr. James W. Knight, Executive Director, Federation of Canadian Municipalities (FCM):



Nancy Loewen has asked me to write to you on the matter of the efforts of Construction Volunteers Canada to raise funds to repair damage to Mount Royal Park caused by the January ice storm.



In the midst of the storm, FCM played an important role in communicating the severity of the situation to its members, and in providing them with information on how their resources could be deployed to the afflicted areas.



The response from municipalities across the country was extraordinary. Fund raising campaigns were launched, hydro crews were dispatched and emergency supplies were shipped.



In some cases, individual municipalities offered support to particular communities with which they had a prior partnership or twinning arrangement. In other cases, aid was provided for use in wherever deemed appropriate by local authorities.



Nancy Loewen had asked that FCM might contact its members specifically urging support to Mount Royal Park. Clearly as a national organization with members throughout the affected area, we are not in a position to urge one particular project ahead of another. We can confirm, however, that Mount Royal Park, one of Canada's oldest urban parks, has suffered extreme damage and its restoration is a cause warranting support.



--------



Ms. Nancy Loewen, President & Director, Construction Volunteers Canada, Bénévoles Canadiens du Batiment, appeared before the Strategic Policies and Priorities Committee on April 7, 1998, in connection with the foregoing matter.

--------



(A copy of background information and photographs, appended to the communication from Nancy Loewen, President and Director, Construction Volunteers Canada, Bénévoles Canadiens du Bâtiment are on file in the office of the City Clerk.)



(City Council on April 16, 1998, had before it, during consideration of the foregoing Clause, a communication (April 13, 1998) from the President and Director, Construction Volunteers Canada, providing additional information concerning the request for a donation of $10,000.00 for Mt. Royal Park.)





5

Scholarship Fund - University of Toronto Scarborough College

Ontario Student Opportunity Trust Fund (OSOTF)



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the following motion moved by Councillor Duguid and seconded by Councillor Faubert, which was referred to the Strategic Policies and Priorities Committee by City Council at its meeting held on March 4, 5 and 6, 1998:



"WHEREAS the former City of Scarborough Council decided on September 16, 1997, to commit $1 million to a Scholarship Fund for the University of Toronto at Scarborough College under the Ontario Student Opportunity Trust Fund (OSOTF); and



WHEREAS the former City of Scarborough confirmed this decision on November 25, 1997; and



WHEREAS the $1 million contribution to this Scholarship Fund has been matched by the University of Toronto at Scarborough, and is also to be matched by the provincial government in the same amount; and



WHEREAS the provincial government, represented by the Minister of Municipal Affairs and Housing, appears to be attempting to avoid contributing to the Scholarship Fund as per their obligations under the OSOTF by filing a Notice of Action with the Ontario Court (General Division); and



WHEREAS the current provincial government has exacerbated the need for scholarship funds due to its neglect of post-secondary education in Ontario, where tuition fees have increased by 59.2 percent since 1995, the number of students dependent on OSAP has increased by 59 percent between 1991 and 1997, the post-secondary operating grants have been cut by the provincial government by $400 million, and Ontario now ranks 10th out of 10 provinces in Canada in per capita funding for universities; and



WHEREAS this motion will not involve the expenditure of any funds by the Council of the City of Toronto, as this money has already been approved and expended by the former City of Scarborough;



NOW THEREFORE BE IT RESOLVED THAT the City of Toronto Council confirm the decision taken by the former City of Scarborough Council, which invested $1 million in a Scholarship Fund for the University of Toronto at Scarborough;



AND BE IT FURTHER RESOLVED THAT the Minister of Municipal Affairs and Housing be advised of this resolution, and that the Province of Ontario be requested to immediately contribute its matching funds to the University of Toronto at Scarborough as per their obligations under the OSOTF program."



The Strategic Policies and Priorities Committee reports, for the information of Council, having requested the Chief Administrative Officer to report directly to City Council on April 16 and 17, 1998, on whether or not there are any precedent setting issues inherent in adopting these recommendations and provide with his report, the background information which was before the Council of the former City of Scarborough when it made its decision.



--------











(Communication dated March 4, 1998, addressed to Councillor Duguid

from J. Robert S. Prichard, President, University of Toronto,)



Thank you for informing my office that Council will be giving due consideration to supporting our students in the amount of $1 million. As you know, this matter was twice approved in 1997 by the former City of Scarborough and we look forward to Toronto City Council's reaffirmation of this splendid initiative.



Strengthening student financial aid is a central priority for the University of Toronto, and, on behalf of all the members of the University community, I want to thank you for your support in bringing this matter to Council's attention and approval.



Your Council's support will make a meaningful difference in the lives of our students. Under the University's Ontario Student Opportunity Trust Fund, the City's support will be matched both by the Province and the University of Toronto (both of which are guaranteed) to produce an overall fund of $3 million designated for the University of Toronto at Scarborough.



We look forward to receiving City Council's formal support. If we can be of any further assistance, please do not hesitate to call Mr. Kasi Rao in my office at (416) 978-1940.





6

Development Charges



(City Council on April 16, 1998, amended this Clause by inserting in Recommendation No. (1) embodied in the report dated March 12, 1998, from the Chief Financial Officer and Treasurer, after the words "staff resources", the words ", including staff from both Toronto School Boards, where appropriate,", so that such recommendation shall now read as follows:



"(1) the Chief Financial Officer and Treasurer be authorized to utilize appropriate staff resources, including staff from both Toronto School Boards, where appropriate, and funds of up to $300,000.00 from the North York Development Charges Reserve Fund - Capital Growth Studies, to undertake the requisite background studies pursuant to the Development Charges Act, 1997;".)



The Strategic Policies and Priorities Committee recommends the adoption of the following report (March 12, 1998) from the Chief Financial Officer and Treasurer:



Purpose:



To seek Council authorization to commence the requisite background studies and policy formulation

leading up to the introduction of a comprehensive development charges by-law for the City of Toronto.



Funding Sources, Financial Implications and Impact Statement:



Development charges are used as a mechanism to recover costs of infrastructure improvements necessary to accommodate new development. The philosophy behind these charges is based on the concept that growth ought to pay for itself and that development related costs should not fall on the tax base.



At present, development charges are not applied uniformly as a capital financing tool in the City of Toronto. The quantum of the charges, the policies governing exemptions, credits and timing of collection and the alternative methods of exacting development related contributions vary substantially across the new City. As a result, two identical development proposals in different areas of the city are likely to be faced with vastly differing municipal financial requirements.



The provincial government has introduced a new Development Charges Act, which comes into force on March 1, 1998. The enactment of this new legislation is timely in that it provides us the opportunity to comprehensively review the capital needs of the new City of Toronto with a view to both fully utilizing this source of financing and standardizing the myriad of rates and practices across the City.



The amount of work leading up to the implementation of a new development charges by-law is substantial. The process is lengthy, requiring a multitude of background studies, justification of the levies, formulation of policy and consultation with stakeholders. By-laws are subject to appeal to the Ontario Municipal Board.



It is proposed that the requisite background studies be funded from an existing development charge reserve fund specifically established for this purpose. No other funding is required and there are no immediate financial implications on the operating or capital budgets.



Recommendations:



It is recommended that:



(1) The Chief Financial Officer and Treasurer be authorized to utilize appropriate staff resources and funds of up to $300,000.00 from the North York Development Charges Reserve Fund - Capital Growth Studies to undertake the requisite background studies pursuant to the Development Charges Act, 1997;



(2) The Chief Financial Officer be authorized to hire, where necessary, the appropriate consultants to assist with these studies; and



(3) Chief Financial Officer proceed as per the attached Schedule A, with a view to ensuring the appropriate by-laws are in place within the 18 months window provided by the legislation.



Council Reference / Background / History:



N/A



Comments and / or Discussion and / or Justification:



What are "development charges"?



Municipalities have traditionally required that developers either build, or pay for infrastructure services that may be required as a result of new development and re-development. In the past, there has been wide disparity among municipalities in the methodology and practices of recovering capital costs from development. These practices have ranged from the use of lot levies, sewage impost charges, S.37 of the Planning Act (bonus zoning) agreements, secondary plan policies and conditions of zoning or site plan approval.



"Development charges" has a very specific meaning as per the legislation, and in this report is used within that context. Development charges are charges imposed against the development or redevelopment of land to pay for growth-related infrastructure. The Development Charges Act specifies the types of costs that may be included in a charge, and the requirements which must be satisfied for a municipality to be able to levy these charges. Development charges pay for "hard services" such as roads, sewers & watercourses and "soft services" such as recreation facilities, parks development, library services, fire protection and other such services. The charges are intended to recover only capital costs, while it is presumed that the new taxes generated by growth will pay for the operating/on-going maintenance costs related to these services.



Development Charges are levies against new development that are collected under provincial legislation (the Development Charges Act), and appropriate municipal by-laws. New development (in the context of the legislation) means development of vacant lands and/or re-development of previously developed lands. In order to collect development charges, a municipality is required to pass by-laws for the imposition of these charges in accordance with the requirements of the Development Charges Act.



Development Charge Legislation:



The first Development Charges Act became law in November of 1989. The intent of the Act was to rationalize these charges and clearly identify what was and was not collectible in the form of development levies. Most municipalities brought forward appropriate by-laws, and have subsequently updated those by-laws as required by the legislation.



In November of 1996, the provincial government introduced draft development charge legislation that was significantly different from the previous Act. Following many months of consultation and intense debate, the legislation was significantly amended, and eventually received royal assent on December 8, 1997. The regulations to the Act were released on February 18, 1998, and the Lieutenant Governor issued a proclamation naming March 1, 1998, as the day the Act comes into force.



The new legislation is different from the old in the following ways:



Ineligible services (Section 2): The new legislation specifically identifies services for which a municipality may not levy a development charge. These services include cultural or entertainment facilities, tourism facilities, parkland acquisition, hospitals, administrative buildings, waste management services and other services as prescribed in the regulations.



Exemption for industrial development (Section 4): Enlargement of the gross floor area of an existing industrial up to 50 percent will not incur a development charge. Under the old legislation this specific provision did not exist.



Methodology for determining development charges (Section 5): The new legislation is more specific about the methodology for developing standards and calculating the actual charges.



Ten percent reduction in capital costs (Section 5): Capital costs for growth related infrastructure should be reduced by 10 percent before the charges are determined. The following services are exempt from this sub-section; water supply services, including distribution and treatment services; waste water services, including sewers and treatment services; storm water drainage and control services; services related to a highway as defined in subsection 1 (1) of the Municipal Act; electrical power services; police services; fire protection services; and other services as prescribed.



Other differences include longer appeal periods, a revised section on Front Ending Agreements, and extensive transition provisions.



Current Status of Development Charges Within the New City:



Three of the former municipalities in Toronto have development charge by-laws in place under development charge legislation passed in November 1989 - North York, Etobicoke and Scarborough. These by-laws levy different rates, for different types of development. In some cases, local Councils have adopted partial or full exemption of these charges to different classes of development.



In 1997, North York, Scarborough and Etobicoke collectively raised approximately $15 million in development charge revenue. This revenue is restricted in use by legislation and can only be spent on specific services and in the former municipalities in which the charges were imposed. Existing development charge reserve funds currently total in excess of $42 million.

Metropolitan Toronto Council in October 1997 approved a by-law to levy area specific charges to finance the growth-related cost attributed to the Sheppard subway. This by-law was developed for implementation under the new development charge legislation. Schedule B provides a summary of existing charges and practices.



Effective January 1, 1998, Bill 103, the City of Toronto Act, 1997 extended these different development charge by-laws to the new City of Toronto. As a result, different development charges are currently collected within different areas in the new City of Toronto. The new Development Charges Act enables current Development Charges by-laws to continue into force until the end of an eighteen (18) months transition period, that is until September 1, 1999. Staff must undertake substantial work and appropriate background studies in order to develop and justify any recommended development charges.



Under normal circumstances 18 months would be sufficient time to meet the requirements of the new draft legislation. In the new City of Toronto, key decisions will be required fairly early in 1998, for the process to be completed within the time-frame provided by the new legislation. To that end, a work plan and timetable for implementation has been prepared and is attached as Schedule "A".



Why Are Development Charges so Important?



Development charges can play an important role in alleviating some of the financial pressures we are experiencing in the new City of Toronto. The Capital Budget in particular will require serious consideration of alternative funding sources for infrastructure. Development charges are one such source that should be explored within the context of a comprehensive development/re-development plan for the new City of Toronto. A simulation model developed by staff provides a broad order of magnitude estimate of the potential development charge revenues that can be generated in the new City of Toronto. The model estimates potential development charge revenues of $45-$55 million per year.



The preliminary estimates serve only to provide a general measure of the level of revenues that can be raised from this financing source. Revenue estimates will be impacted by a number of policy decisions that Council will have to consider. These include whether or not to provide full or partial exemptions to various classes of property, the degree of competitiveness of the charges relative to other GTA municipalities and the extent to which development charges should be set to recover all eligible growth related costs (ie. the recovery rate).



Conclusions:



This report begins the lengthy process of reviewing future development potential, developing a long-term capital program, gathering data related to service levels, costs and standards and establishing the criteria and principles on which a development charges by-law (or by-laws) should be based. The process requires that staff work in consultation with the development industry and other stakeholders so as to recommend charges that are reasonable, but reflective of the impact of new development/re-development on the city's capital infrastructure.



Contact Name and Telephone Number:



Val Sequeira - Metro Hall: 397-4225, Scarborough: 396-4271

Rob Hatton - Metro Hall: 392-9149

Joe Farag - North York: 395-6706, Metro Hall: 397-4208



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Schedule "A"



Work Program

For Adoption Of A New Development Charge Bylaw

And Related Policies



Phases
Key Elements Time Frame
1. Approval to Commence - SP&P

- Council

Mar/98 - Apr/98
2. Start up - Establish interdepartment D.C. working group (Finance, Planning, Legal, Works, Transportation, etc)

- Retain consultant(s)

- Initial consultation with development/homebuilders industry

Apr/98 - May/98
3. Data Collection - Review existing and uncommitted reserve fund balances

- Growth forecast (res., com., ind., inst.) for 10 yr, 20 yr or OP build-out

- Determination of which services/servicing situations are to be covered under subdivision/consent agreements (outside DCA)

- Average 10 yr service standard determination

- Identification and cost of potential works related to growth

- Review of long term debt and identification of existing facility oversizing

Jun/98 - Sept/98
4. Policy Development - Assessment of Municipal-wide vs area specific D.C.'s

- Analysis of transitional issues related to existing municipal benefits, ineligible municipal services and outstanding debt

- Formulation of DC credit policy and any other relevant agreements or credit provisions including former City by-laws

Aug/98 - Oct/98
5. Development Charges Calculations and Rules - Estimation of costs to meet increases in need for services attributable to development; the required works; existing facility oversizing consistent with services standards

- Calculation of D.C. rates reduced by:

- existing capacity created

- benefit derived by existing development from the increase in service

- anticipated capital grants, subsidies or other contributions

- percentages and capital costs exclusion designated by Act

- formulation of rules for exemptions, phase-in, indexing, charges for re-development, etc.

- Preparation of D.C. background study

Oct/98 - Dec/98
6. Examination of Long Term Capital & Operating Costs - Examine the long term capital and operating costs for capital infrastructure required to service new development. Nov/98 - Jan/99
7. Draft D.C. Background Study - Finalization of draft D.C. background study for review with D.C. Steering Committee/SP&P/Council

- Formulation of preliminary policies re: credits, commencement date, collection timing, etc.

Jan/99 - Feb/99
8. Public Process - Pre-meeting consultations

- Advertisement and holding of Public meetings

- Receipt and consideration of submissions

Mar/99 - May/99
9. Adoption Process - Preparation of public consultation report, including review of options and assessment of impacts Jun/99 - Jul/99
10. Implementation Process - Collections/administration process

- By-law indexation

- Reserve fund reporting requirements

- Notice for former section 13 credits

- Former section 14 credits

Jul/99 - Aug/99









7

Process to Develop an Agreement on Matters of Mutual Interest

Between the City of Toronto and the Greater Airports Authority

to Lester B. Pearson International Airport



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 7 of Report No. 4A of The Strategic Policies and Priorities Committee.)





8

Business Improvement Areas: Interim Administrative Procedures

for 1998 and Municipal Code Amendments for the

(Former) City of Toronto



(City Council on April 16, 1998, amended this Clause by amending Recommendations Nos. (2) and (4) of the Strategic Policies and Priorities Committee to provide that BIA appointments and budgets be reported through the Economic Development Committee.)



The Strategic Policies and Priorities Committee recommends the adoption of the following joint report (March 19, 1998) from the Interim Lead, Economic Development, the Commissioner of Urban Planning and Development and the Chief Financial Officer and Treasurer, subject to the following amendments:



(1) deleting from Recommendation (5)(c) the date "July 31, 1998" and inserting in lieu thereof "August 31, 1998 or the 1st day of the month following the due date" so that Recommendation (5)(c) now reads:



"(c) that BIA advances on the first 50 percent of the net levy be interest free until August 31, 1998 or the 1st day of the month following the due date, and that interest be charged at the rate of prime plus one percent on the portion of advances in excess of 50 percent of the net levy and after August 31, 1998 or the 1st day of the month following the due date, and";



(2) deleting from Recommendation (7) the words and numbers "Section 86.1 of" so that Recommendation (7) now reads:



"(7) The Procedural By-law be amended to authorize the Strategic Policies and Priorities Committee to deal with BIA Boards of Management appointments and the Budget Committee to deal with BIA budgets instead of the Urban Environment and Development Committee.";



(3) renumbering Recommendation (8) and numbering it Recommendation (9); and



(4) inserting a new Recommendation (8) to read as follows:



"(8) Recommendation (7) be deemed notice to amend the Procedural By-law as required by Section 134 thereof."



The Strategic Policies and Priorities Committee submits the following joint report (March 19, 1998) from the Interim Lead, Economic Development, the Commissioner of Urban Planning and Development Services and the Chief Financial Officer and Treasurer:



Purpose:



This report outlines the Business Improvement Area Program and recommends interim administrative procedures and policies for 1998 and process for developing an integrated program across the amalgamated municipality for implementation in 1999.



Funding Sources, Financial Implications and Impact Statement:



No funding is required. Providing interest-free advances to BIAs as has been requested by the Toronto Association of BIAs and as is set out in Recommendation 5© will result in lost revenue to the City in treasury bill interest on investments. It is estimated that the net revenue reduction will be in the range of $8,000.00 to $12,000.00.



Recommendations:



It is recommended that:



(1) City Council request the Minister of Municipal Affairs to amend the meaning of BIA membership set out in Section 220 of the Municipal Act to include all business tenants as well as the assessed owners "of rateable property in the area that is in a prescribed business property class";



(2) to clarify that all business tenants may continue to participate at BIA General Meetings, that authority be granted for the introduction of the necessary Bills to Council to give effect to an amendment to the (former) City of Toronto Municipal Code which will delete subsections A, B, C and D of Section 20-10;



(3) the City Solicitor be authorized to review Section 20 of the former City of Toronto's Municipal Code and to introduce the necessary Bills to Council to bring it into compliance with the amendments made by Bill 106;



(4) the Director of Economic Development be requested to review the administrative practices, services and support that has been provided to BIAs in each of the former municipalities in consultation with the BIAs and the Chief Financial Officer, Solicitor, Auditor, and other staff involved in administrating the program, and report further recommending an integrated BIA program for implementation in 1999;



(5) the following interim administrative procedures be adopted for the BIA program during 1998:



(a) that BIA levies be included on the final realty tax bill in 1998 due to the late delivery of the assessment roll;



(b) that BIAs be permitted to draw advances of up to 75 percent of their net levy following approval of their budgets by Council;



(c) that BIA advances on the first 50 percent of the net levy be interest free until July 31, 1998, and that interest be charged at the rate of prime plus one percent on the portion of advances in excess of 50 percent of the net levy and after July 31, 1998;



(d) that the balance of the net levy be provided to BIA Boards of Management only when collected;



(6) City Council adopt the objective of continuing to serve BIAs with as little disruption as possible during 1998 while the program review is ongoing, and to that end generally continue to provide each BIA with the same services as were previously available in its former municipality;



(7) Section 86.1 of the Procedural By-law be amended to authorize the Strategic Policies and Priorities Committee to deal with BIA Boards of Management appointments and the Budget Committee to deal with BIA budgets instead of the Urban Environment and Development Committee; and



(8) the appropriate City officials be authorized to take the actions necessary to implement the foregoing.



Background:



Business Improvement Areas (BIAs) play a key role in the beautification, safety, maintenance and promotion of retail strips and traditional downtowns across Ontario. The BIA program is governed by provincial legislation (Section 220 of the Municipal Act) and is administered by municipalities. If the majority of businesses in an area are in favour of forming a BIA, the municipality is permitted to pass a by-law so designating the area. This enables the businesses and property owners in an area to contribute to a special levy that can then be used to promote the area as a shopping district and to make improvements to public property. The size of the levy and how it is used is determined by a volunteer Board of Management made up of BIA members and municipal councillors. The people on the Board of Management and the annual budget and levy is approved by Council. The levy is collected by the municipality and turned over to the Board of Management for spending in accordance with the approved budget. Every business property in the area is automatically a member of the BIA and is required to pay its share of the improvement budget.



BIAs do not receive direct funding from the municipality. Most municipalities provide staff support to the program at no charge, and many also contribute grants, physical infrastructure (such as enhanced lighting, flower boxes, decorative brick sidewalks, banners, etc.) and various types of in-kind services (e.g. audit services, office space and services). The amount and type of municipal support provided varies widely across the province.



There are 39 BIAs across the City of Toronto. The largest concentration of BIAs is in the former City of Toronto, as follows:

Toronto 26

North York 0

Scarborough 1

Etobicoke 6

East York 1

York 5



Total - 39



The appended map indicates the general location of the City's BIAs while Appendix A lists all of the City's BIAs and designating by-laws.



As is summarized in Appendix B, Toronto BIAs collectively raised over $3 million from their business members in 1997 -- monies which were reinvested in upgrading the City's commercial districts' appearance and services, holding special events and festivals and in district promotion. About three hundred business representatives served on the volunteer Boards of Management, contributing thousands of hours of time to developing and implementing BIA programs and representing the interests of their neighbourhoods.



The BIA program is widely considered to be a successful commercial area revitalization model and has been emulated around the world. The money and time which the program encourages business to invest in their commercial districts creates a more attractive ambiance along city streets. Local residents enjoy the many free festivals and special events sponsored by BIAs. The enhanced appearance and image of the commercial district contributes to the quality of life in the local community. It also makes the district more attractive to businesses seeking new locations. Local businesses see a return on their investment as people translate their increased enjoyment of the area into increased visits and increased sales. In short, a successful BIA program helps anchor an upward spiral of increased business for local merchants and increased neighbourhood amenity for local residents. It contributes to the local economy by attracting specialty shopping and tourist expenditures, and by helping to make the City an attractive community in which to live and do business.



The BIA program is affected by two major changes that took effect on January 1, 1998:



(1) the changes to the municipal taxation system that were introduced in the province by Bill 106; and



(2) the amalgamation of the City of Toronto.



This report summarizes the implications of these changes, and recommends interim administrative procedures and other actions to reduce their negative impact on the BIA program during 1998.



Comments:



(1) Impact of Bill 106:



Bill 106, the Fair Municipal Finance Act, eliminated the business occupancy tax and the maintenance of a business assessment roll by the Province. This necessitated that it also make a number of changes to the BIA program since the business assessment roll was the basis for determining BIA membership and levies. The amendments and the impact on the BIA program are summarized in the following table:





CHANGE IMPACT
BIA levies were previously billed to business tenants. With business tenancies no longer being included on the assessment roll, BIA levies have become the responsibility of property owners. The BIA levy will be billed to property owners, and landlords will be responsible for paying the levy to the municipality. The municipality should incur significantly lower costs in billing and collecting the BIA levy.
BIA levies are "deemed to be taxes" so that, if not collected, they become a lien on the property. The municipality will now be a secured creditor and the collection of BIA levies is guaranteed. The BIA levy will become virtually 100 percent collectable (however, there may still be a time delay in collections). This contrasts with the current situation where about 15 percent of BIA levies are eventually written off. In many BIAs, it should therefore be possible to reduce the amount of levy required to collect any given budget.
BIA membership previously consisted of all business occupants included on the assessment roll. Bill 106 changed BIA membership so that only commercial property owners and business tenants who are responsible for the payment of realty taxes through their lease arrangements are members. Business tenants who are not responsible for the payment of realty taxes through their lease arrangements are no longer qualified to be BIA members. BIAs traditionally have been made up of all business occupants whether they be tenants or owner-occupants. These have been the interests who have voted to set up BIAs, who served as members on the Board, who determined the improvement program and who paid the BIA levies. Under Bill 106, property owners become new key players in the BIA process.

Tenant businesses are entitled to remain involved only if their leases require that they pay realty taxes. Such leases are rare in small commercial properties such as typify most BIAs. Many people who currently are active BIA leaders are no longer automatic members of the BIA. They may continue to participate only if they are nominated by a BIA member to represent his/her interests.

Landlords are responsible for identifying and informing the City Clerk of those tenants in the business property class who, under their lease are required to pay all or part of the taxes on the property. There is, however, no incentive for landlords to provide this information or recourse if they don't. The municipality and BIA boards of management can no longer readily identify which business tenants are BIA members and which are not.



Although the increased collectability of the BIA levy is welcomed, the Toronto Association of Business Improvement Areas (TABIA) is extremely concerned about the impact that the change in membership may have on the success of the BIA program. It is their experience that absentee property owners usually have not been involved or interested in BIAs. The program has been developed and operated to serve the interests of the business community. TABIA is concerned that property owners and business operators often have been shown to have different priorities. They see a potential for absentee owners to opt for cost-minimization, and to force BIAs into inactivity by overwhelming the business interests and voting down their budgets or initiating dissolution procedures. The fact that a portion of the BIA levy will be charged to vacant floor space may increase this risk.



TABIA's concerns are shared by many BIAs in other parts of the province.



There also are significant administrative complications introduced by the distinction between tenants whose leases do and do not require them to pay their property taxes. The municipalities and boards of management will have to create and maintain their own lists of tenants qualified for BIA membership if they are to keep them informed about BIA activities, notify them about meetings, and verify their eligibility to serve on boards of management. The only way to verify eligibility may be to require that tenants provide copies of their leases to the municipality.



Over the last year, TABIA has devoted considerable energies towards bringing their concerns to the attention of provincial and municipal officials and in proposing alternative solutions. Although the Province declined to make amendments that would secure the participation of all business occupants in BIA programs before Bill 106 came into force, provincial officials did indicate that additional changes to the Municipal Act were contemplated in 1998, and that this would provide an opportunity to address the issue.



Most recently, on February 5, 1998, the Minister of Finance announced that changes would be made to enable all business tenants to become full members of BIAs. He also indicated that legislation would be introduced to enable landlords to recover property tax increases from all tenants regardless of the provisions in their leases.



However, at the present time, BIA membership is still limited to property owners and those tenants whose leases require that they pay realty taxes. After considerable consultation with TABIA, it was determined that the problems this presents for BIAs could be reduced if all business operators could continue to vote on the budget and on which BIA representatives should be on the Board of Management. This is possible under current provincial legislation since the Municipal Act indicates only that BIA Boards of Management must submit to Council budget estimates for the current year. It does not specify how those estimates are to be determined. Nor does it specify how Council should choose which BIA members should be on BIA Boards of Management.



However, the former City of Toronto has set out a more detailed process for holding elections to BIA Boards of Management and approving budgets in Section 20 of its Municipal Code. It requires BIAs to hold General Meetings of the membership at which elections to the Board are held and the annual budgets are approved. It also requires that the Board send a meeting notice to all BIA members by pre-paid post at least ten days before the Meeting. Although these provisions have better ensured that BIAs follow a democratic process and fully inform their membership when making key decisions, they now pose an additional constraint on the ability of business owners who are tenants not required to pay realty taxes to participate in BIAs. Therefore, it is recommended that these provisions be deleted from the Code (Section 20-10 subsections A, B, C and D).



While these provisions can be deleted from the Code, it is not possible to replace them with provisions that would implement the intent that all business tenants continue to be informed and involved in the process as well as BIA members. The problem is that BIA Boards of Management are "Bodies Corporate", and therefore cannot formally be required by legislation to involve people who are not members of the Corporation in their decision-making processes.



This notwithstanding, TABIA's desire that all business operators continue to be involved in electing the Boards of Management and voting on BIA budgets can be achieved if the General Meetings are viewed as giving advice to the Boards of Management and Council. Each Board of Management should officially approve its budget after the General Meeting is over, and final authority to approve the BIA's budget rests with City Council.



The By-laws in effect in Scarborough, Etobicoke, East York and York do not require their BIAs to follow more detailed election and budget approval procedures than are set out in the Municipal Act. Therefore City Council action is not necessary to permit their BIAs to involve all business operators as well as property owners to the extent that they currently do.



Since the Municipal Act indicates that only BIA members and members of Council can be appointed to BIA Boards of Management, any business tenants not required to pay their realty taxes that the membership elects to the Board of Management at a General Meeting will need to be a nominee of a BIA member. Economic Development division staff are verifying the eligibility of all persons elected to BIA Boards, and will ensure that anyone who is not a BIA member as set out in the revised Municipal Act is a person who has been nominated by a BIA member before forwarding their names to Council for approval.



The amendments to BIA membership and procedures introduced by Bill 106 make some subsections of the former City of Toronto's Municipal Code obsolete. It is recommended that the City Solicitor be authorized to review the Municipal Code and make the amendments necessary to bring it into compliance with Bill 106.



(2) Billing the BIA Levy:



Since the BIA levy is now charged to property owners, it can be included as a line item on the realty tax bill. This will significantly reduce the City's costs since it will not be necessary to send out a separate bill or to process separate BIA levy payments.



In 1999 the City may have the option of including all or a portion of the levy on the interim tax bill. This was not possible in 1998 because of the late delivery of the assessment roll. Therefore, it is recommended that the 1998 BIA levy be included on the final realty tax bill. This will delay the collection of funds until several months later than has been the norm. In view of this delay, it is recommended that BIAs be permitted to draw advances of up to 75 percent of their approved budgets in 1998.



In the past, the former City of Toronto charged its BIAs interest at the rate of prime plus one percent on any funds they requested in advance of levy collections. Scarborough, York and Etobicoke provided interest free advances, while East York did not previously provide advances. The Chief Financial Officer recommends that this practice be harmonized in 1998.







At its Annual General Meeting on February 17, 1998, TABIA adopted a motion to request that the City provide advances of up to 50 percent of BIA budgets interest-free in 1998 due to the late billing of the BIA levy. It previously was possible for the City to bill BIA levies in March. Due to the late delivery of the assessment roll, in 1998 the bills will be sent out at least three months later than normal. TABIA questions the equity of requiring BIAs to pay additional interest charges for a delay in receiving funds that is beyond their control.



It is recommended that interest be charged on BIA advances in excess of 50 percent of their net levy at the rate of prime plus one percent.



Providing BIAs with interest free advances is a cost to the City since the receipt of investment interest on those funds is foregone. The cost will depend on the amount of advances requested by the BIAs and the length of time the advances are outstanding. It is recommended that the City put a time limit on the interest free period. July 31, 1998 is suggested since it is expected that payment of two thirds of the levy will be due by this date.



The absolute maximum cost of providing interest free advances until July 31, 1998 will be $16,850.00. This amount will only be incurred if no portion of the levy is collected before July 31 (this is unlikely since the due date for payment of the first one third of the levy is expected to be June 30) and if all BIAs immediately request the maximum interest-free advances. This amount will be reduced to the extent that levy payments are received by the City before July 31 and that BIAs delay or do not request advances or request advances in excess of 50 percent of their levies (and pay interest on those portions). All three of these things are likely to happen, and a more realistic estimate of the cost of providing interest-free advances to BIAs probably is in the $8,000.00 to $12,000.00 range.



It is anticipated that the need for BIA advances will be reduced in the future if the levy or a portion thereof can be included on the interim tax bill. Policy respecting interim billing and the charging of interest on advances are among the issues to be addressed in the review of the BIA program discussed in the following section of the report.



(3) Issues Related to Amalgamation:



It is considered desirable that the BIA program be administered consistently across the new City of Toronto. However, each of the five municipalities within the new Toronto that have BIAs have dealt with them in different ways in the past. Some of the municipalities have their own by-laws governing the program while others do not. Different services are offered and fees charged from area to area. Before an integrated program can be developed, considerably more review and discussion is needed to evaluate which practices are the most efficient and which services are the most cost effective and important to offer within the context of limited resources. Therefore, it is recommended that 1998 be considered a transition year during which BIA practices will be reviewed with the objective of bringing forward recommendations for an integrated program in time for 1999 implementation.





The objectives of the review are to develop a program which (a) supports the ability of BIAs to contribute towards the economic health of the City; (b) provides the required municipal administrative support efficiently and economically; and (c) encourages BIA Boards to be accountable to their members. The issues and services that will be addressed include:



(a) election and budget approval procedures;

(b) the role of the municipality in monitoring Board practices and expenditures;

(c) policies and procedures respecting audits, access to insurance coverage, billing and collecting the levy transferring funds to the BIAs, and the charging of interest on advances;

(d) procedures for forming new BIAs;

(e) the need to maintain a list of businesses in BIAs;

(f) the need for a municipal BIA by-law;

(g) the provision of municipal services to BIAs and the charging of fees; and

(h) the provision of commercial revitalization and economic development advice and assistance to BIAs, and municipal expenditures on special grants and services (e.g. municipal contributions to streetscape improvements).



It is recommended that the review be co-ordinated by Economic Development staff, in consultation with the BIAs and all other staff who are involved with administering various aspects of the program.



While this review is underway, it is recommended that each BIA continue to be served in accordance with past practices. The Boards will then be in a better position to plan their budgets and programs knowing (for example) that the municipality will or will not pay for banner installations or the planting of trees in 1998 if that was the practice in the past.



Notwithstanding this general approach, the process for securing Council approval of the BIA Boards of Management and budgets and levies can be harmonized immediately without affecting service to the BIAs. Section 86.1 of the Procedural By-law indicates that BIA Board appointments and budgets be reported to Council through the Urban Environment and Development Committee. However, this is the only aspect of the BIA program that is dealt with by that Committee. The remainder of the economic development program reports to Council through the Strategic Policies and Priorities Committee. It would be more efficient for staff and probably more rationale for Committee members if the Strategic Policies and Priorities Committee were to deal with BIA Board appointments as well as other aspects of the program. Staff in the Finance Department are of the view that BIA budgets should be reviewed by the Budget Committee instead of the Urban Environment and Development Committee. It is recommended that the Procedural By-law be so amended.



Conclusions:



BIAs play a significant role in helping the City maintain a healthy community and economy. It is important that their effectiveness not be undermined by the changes that have been made to the property tax system and structure of municipal government. The interim administrative procedures and program review set out in this report are intended to serve this objective.



Contact Name:



Judy Morgan; phone number 392-1003; fax number 392-0675; E-mail address jmorgan1@city.toronto.on.ca



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Appendix A



Business Improvement Areas



Name of BIA Designating By-law



City of Toronto:



Bloor-Bathurst-Madison 1995-0688

Bloor By The Park 117-87

Bloorcourt Village 495-79

Bloordale Village 150-76

Bloor West Village 30-86

Bloor-Yorkville 302-87

Corso Italia 807-83

Danforth by the Valley 611-86

Dovercourt Village 549-84

Eglinton Way 662-86

Elm Street 171-85

Forest Hill Village 8-79

Gerrard India Bazaar 590-81

Greektown on the Danforth 319-86

Harbord Street 555-85

Hillcrest Village 808-83

Junction Gardens 8-73

Little Italy 497-85

Old Cabbagetown 1-82

Parkdale Village 497-78

Queen/Broadview Village 263-80

Roncesvalles Village 169-90

St. Clair Gardens 59-85

St. Lawrence Neighbourhood 1994-0572, as amended by 1996-0406

Upper Village 810-83

Yonge/Queen-Dundas 531-86





City of Etobicoke:



Lakeshore Village 2702

The Kingsway 2968

Mimico by the Lake 1985-286

Village of Islington 1986-130

Village of Long Branch 1987-20

Mimico Village 1997-210



City of Scarborough:



Kennedy Road 18758

Borough of East York:

Pape Village 25-86



City of York:



Weston 2245-75

Upper Village (York) 3298-96 as amended by 3370-96

Mount Dennis 2012-74

York-Eglinton 3964-81 as amended by 2605-92

Keele-Eglinton 3652-97



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Appendix B

Summary of Business Improvement Areas and

1997 BIA Levies by Area Municipality





Municipality
Business Improvement Area Name 1997 BIA Levy Total 1997

BIA Levies

City of Toronto Bloor/Bathurst-Madison $20,000



$2,655,015
Bloor by the Park $36,500
Bloor West Village $240,660
Bloor-Yorkville $920,000
Bloorcourt Village $52,000
Bloordale Village $30,030
Corso Italia $160,000
Danforth by the Valley $56,650
Dovercourt Village $4,035
Eglinton Way $119,700
Elm Street $8,000
Forest Hill Village $19,300
Gerrard India Bazaar $40,000
Greektown on the Danforth $186,795
Harbord Street $22,500
Hillcrest Village Inactive
Junction Gardens $78,510
Little Italy $79,860
Old Cabbagetown $153,500
Parkdale Village $96,000
Queen/Broadview Village $84,000
Roncesvalles Village $61,975
St. Clair Gardens Inactive
St. Lawrence Neighbourhood $50,000
Upper Village (Toronto) $135,000
Yonge/Queen-Dundas Inactive
City of Etobicoke Lakeshore Village $33,775 $195,008
The Kingsway $111,233
Mimico by the Lake $0
Village of Islington $0
Village of Long Branch $50,000
Mimico Village $0
City of Scarborough Kennedy Road $225,708 $225,708
Borough of East York Pape Village $36,000 $36,000
City of York Weston $50,000

$105,000
Mount Dennis Inactive
York-Eglinton Inactive
Keele-Eglinton New
Upper Village (York) $55,000
Total - All BIAs $3,216,731


Mayor Lastman declared his interest in the foregoing matter and stated that the general nature of his interest is that his son is the President of the Kennedy Road Business Improvement Area.



(Mayor Lastman, at the meeting of City Council on April 16, 1998, declared his interest in the foregoing Clause, in that his son is the President of the Kennedy Road Business Improvement Area.)





9

Terms of Reference - Audit Committee



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the recommendation of the Audit Committee embodied in the following transmittal letter (March 25, 1998) from the Audit Committee:



Recommendation:



The Audit Committee on March 24, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the Terms of Reference for the Audit Committee set out in the report (March 4, 1998) from the City Auditor.



The Audit Committee reports, for the information of the Strategic Policies and Priorities Committee, and Council, having requested the Chair of the Audit Committee to place a notice of motion on the agenda for the Council Meeting to be held on April 16, 1998, requesting Council to:



(1) reconsider its decision made at its meeting held on January 2, 6, 8 and 9, 1998, to appoint three members to the Audit Committee;

(2) increase the size of the Audit Committee to a membership of five; and

(3) authorize the introduction of the necessary Bill in Council to amend Procedure By-law No. 23-1998 to give effect thereto.



Background:



On March 24, 1998, the Audit Committee had before it a report (March 4, 1998) from the City Auditor, setting out Terms of Reference for the Audit Committee and recommending that the size of the Committee be increased to five. The Audit Committee approved the Terms of Reference recommended and also to increasing the membership of the Committee, but recognized that changing the membership would require the re-opening of a previous decision of Council. A notice of motion therefore will be placed on the agenda for the Council Meeting to be held on April 16, 1998, by the Chair of the Committee.



--------



(Report dated March 4, 1998, addressed to the

Audit Committee from the City Auditor)



Recommendations:



It is recommended that:



(1) the Terms of Reference of the Audit Committee as outlined in this report be adopted; and



(2) the composition of the Audit Committee be increased from three members to five members.



Background:



The Toronto Transition Team in its December 1997 report, recommended the formation of an Audit Committee. The report indicated that "An Audit Committee should be formed once a year, or as required, to arrange for and receive on behalf of Council, the annual external audit of the City's books. This committee would be required only for this function, and would not have ongoing duties. We suggest a committee of three Councillors, who are not chairs of standing committees, chairs of community councils or members of the Budget Committee."



In addition, the Transition Team recommended that the "annual attest audit should be done by an external auditor hired by an Audit Committee of Council and the City should have an internal audit function to provide audit services to the Corporation."



Comments:



Audit Committees in both the private and the public sector have a wide range of responsibilities. These responsibilities relate to both the attest audit process and the internal audit function. The report of the Transition Team indicates that the role of the Audit Committee should be restricted to the attest audit only. The Transition Team's recommendation is inconsistent with the practice in both the private and public sector and consequently, is inappropriate. In order to operate effectively, the role of the Audit Committee at the City of Toronto should encompass the activities of both the attest and the internal auditor.



The responsibilities of the Audit Committee in terms of the attest audit and the internal audit are as follows:



(1) The Responsibilities of the Audit Committee in relation to the Attest Auditor:



The Municipal Act requires that City Council appoint an auditor to audit the financial statements of the municipality and its local boards. The term of the appointment is to be for five years or less.



The auditor's prime duties are prescribed by the Ministry but, in addition, the auditor may also undertake such duties as may be required by Council, or any local board, that do not conflict with the duties prescribed by the Ministry.



The Audit Committee should meet with the attest auditor at least twice during the annual audit cycle. The first meeting should relate to the actual planning of the attest audit. The second meeting should be to receive the auditor's report on the annual financial statements. Additional meetings may be called by either party.



Planning Meeting:



The first meeting, probably in September/October of each year, should focus on reviewing the auditors' audit plan. The planning meeting should:



(1) Provide the attest auditor the opportunity to present:



(a) the proposed scope of audit work;

(b) areas to which he or she intends to give particular attention;

(c) any anticipated areas of difficulty with the upcoming audit;

(d) any changes in audit approach; and

(e) any change in prescribed duties.



(2) Provide the Audit Committee with the opportunity to advise the Auditor of any areas of concern that the Committee would like him or her to address during the audit, and discuss any additional fees this may involve.



Meeting on Presentation of Auditor's Report:



The second essential meeting should be when the financial statements and the auditor's report on those statements are presented. The auditor's management letter, including management's responses to significant points raised, would also be presented and reviewed at the same time.



It is management's responsibility to prepare and present the financial statements. It would be usual for the City Treasurer to review the financial results and significant features of the financial statements with the Committee.



It is the attest auditor's responsibility to express an opinion on the financial statements prepared by management based on his or her audit. The auditor's opinion represents an assurance that the financial statements fairly present the financial position of the City at year end and the results of the year's operations, in accordance with appropriate accounting principles.



The auditor will normally present to the Committee the highlights of the audit and any significant observations or recommendations he or she wishes to make. The Committee ought also to hear management's responses to the points raised.



(2) The Responsibilities of the Audit Committee in Relation to the Internal City Auditor:



The key responsibilities of the Committee and suggested guidelines in connection with the City Auditor are outlined below.



Three-Year Audit Work Plan:



The Office of the City Auditor should operate on the basis of a three-year work plan, reviewed and updated annually. Since this plan determines where audit resources are utilized, it is critical that the Audit Committee ensure that the plan addresses areas of importance and reflects the requirements of the Audit Committee, Council and Senior Management.



The following steps are suggested:



Audit Committee Input:



The Audit Committee should review with the City Auditor a preliminary draft of the 3 year audit work plan. Key questions that should be addressed in this review are:



(1) Has the Office of the City Auditor developed an adequate description of all areas that could be subject to audit?



(2) What basis has been used to determine the risks associated with each potential audit area?



(3) How has the City Auditor arrived at the particular selection of audit projects that appear in the preliminary draft plan? What will, as a result, not be audited in the next three years?



(4) What input has Council, the Chief Administrative Officer and other senior management staff and the Attest Auditor had into this preliminary draft?



(5) Is there appropriate coordination between the internal and attest auditors?



The Audit Committee, based on these considerations, should be in a position to determine if it wishes other audits to be included in the work plan, and should direct the City Auditor accordingly.



Changes to the Work Plan by the Audit Committee or Council:



As a matter of practice, the Audit Committee may at any time direct the City Auditor to undertake an audit or review not included in the work plan. The City Auditor will not undertake projects at the request of individual Members of Council.



Services to Management:



The City Auditor should be viewed as providing a constructive service to management as well as to Committee and Council. In this regard, it is imperative that the Chief Administrative Officer and senior management have available an audit resource to address ongoing concerns identified by staff. Consequently, the City Auditor's work plan should be flexible to the extent that there are resources available to address such concerns. Many of these concerns would be resolved at the senior management level and would not necessarily result in the preparation of a formal report.



Audit Reports:



The City Auditor is required to prepare and present a report to the Audit Committee on the completion of each audit in his work plan, setting out his findings and recommendations. The report should also contain management's comments on the City Auditor's recommendations.



In reviewing each audit report, the Audit Committee might consider the following:



(1) Are the recommendations in the audit report appropriate in the light of the audit findings?



(2) Are management's responses and proposed actions appropriate and sufficient?



(3) Has management addressed the findings and recommendations from previous audits?



(4) What additional directions, if any, does the Committee wish to give?



(5) Are there related issues, not covered in the audit report, that are of concern to the Committee?



(6) Does the City Auditor plan to do a follow-up audit?



(7) Are there any unresolved issues between management and the City Auditor? What are the implications?



Meetings:



The Audit Committee should meet at least on a quarterly basis. Additional meetings may be held as deemed necessary by the Chair of the Committee or as suggested by the attest or internal auditor. During the transition process, it is recognized that more regular meetings may be required.



Composition of the Audit Committee:



An Audit Committee consisting of three members is inadequate, particularly in the context of its wide ranging responsibilities. A three member committee does not serve to recognize the importance of the role of the committee, particularly when viewed in relation to the size of the new City. Audit Committees generally work best when they comprise a blend of different skills and business experience. It is suggested that an Audit Committee of five members could generally provide this blend. Various research has indicated that in practice, an Audit Committee of five members is the most common number in terms of effectiveness.



Conclusion:



The responsibilities of the Audit Committee as suggested by the Toronto Transition Team are inadequate and should be amended to encompass the activities of both the attest and the internal auditor, as outlined in this report. In addition, the composition of the Audit Committee should be expanded from three members to five members to more accurately reflect the importance of the responsibilities of the Committee.



Contact Name and Telephone Number:



Jeffrey Griffiths, 392-8461





10

Audit Services



(City Council on April 16, 1998, struck out and referred this Clause to the Audit Committee for further consideration.)



The Strategic Policies and Priorities Committee recommends the adoption of the recommendation of the Audit Committee embodied in the transmittal letter (March 25, 1998) from the Audit Committee.



The Strategic Policies and Priorities Committee reports, for the information of Council, having referred the restructuring of the Audit Department, as proposed in the joint report (February 6, 1998) from the Chief Administrative Officer, City Auditor and Chief Financial Officer and Treasurer, to the Budget Committee and the budget process, to allow City staff to meet with representatives of CUPE Local 79 to see if the cost savings can be realized with as few staff reductions as possible.



The Strategic Policies and Priorities Committee submits the following transmittal letter

(March 25, 1998) from the Audit Committee:



Recommendations:



The Audit Committee on March 24, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, that:





(1) the following recommendations of the Toronto Transition Team in connection with the delivery of audit services be approved:



(a) that the City should have an internal Audit function to provide ongoing audit services to the Corporation; and



(b) that the annual attest audit should be done by an external auditor hired by an Audit Committee of Council;



(2) the City Auditor and the Chief Financial Officer and Treasurer be given authority to proceed with a Request for Proposal in relation to the annual attest audit for the fiscal years 1998 to 2002 inclusive;



(3) the Chief Financial Officer and Treasurer establish a staff committee, including the City Auditor, to review the proposals and make recommendations to the Audit Committee concerning the selection of external auditors; and



(4) the Chief Administrative Officer and the City Auditor work with the Chief of Police and the General Manager of the Toronto Transit Commission to examine what opportunities there may be to consolidate audit functions.



The Audit Committee reports, for the information of the Strategic Policies and Priorities Committee, and Council, having referred the restructuring of the Audit Department, as proposed in the joint report (February 6, 1998) from the Chief Administrative Officer, City Auditor and Chief Financial Officer and Treasurer, back to the City Auditor and requested that:



(a) dialogue be commenced with representatives of CUPE Local 79 as soon as possible;

(b) every effort be made to introduce a redeployment program for staff to be streamlined; and

(c) when he reports back to the Audit Committee, a proposed organization chart for the new Audit Department be included.



Background:



On March 24, 1998, the Audit Committee had before it a joint report (February 6, 1998) from the Chief Administrative Officer, City Auditor and Chief Financial Officer and Treasurer, on the provision of audit services to the new City of Toronto.



The Audit Committee also had before it communications from the following:



(a) Mr. Denis Casey, Acting President, CUPE Local 79; and

(b) Mr. John Woods, Auditor of the former City of Toronto.



The following persons appeared before the Audit Committee on March 24, 1998, in connection with this matter:



- Mr. Denis Casey, Acting President, CUPE Local 79

- Ms. Ann Dembinski, Second Vice-President, CUPE Local 79



--------



(Joint Report dated February 6, 1998, addressed to the

Audit Committee from the Chief Administrative Officer,

City Auditor and Chief Financial Officer & Treasurer,)



Recommendations:



(1) That the recommendation of the Toronto Transition Team in connection with the delivery of audit services be approved;



(2) That the City Auditor and the Chief Financial Officer & Treasurer be given authority to proceed with a Request for Proposal in relation to the annual attest audit for the fiscal years 1998 to 2002 inclusive;



(3) That the Chief Financial Officer & Treasurer establish a staff committee including the City Auditor, to review the proposals and make recommendations to the Audit Committee concerning the selection of external auditors; and



(4) That the City Auditor be given authority to proceed with the restructuring of the Audit department as proposed in this report.



Background:



The December 1997 report of the Toronto Transition Team recommended that:



(1) the annual attest audit should be done by an external auditor hired by an Audit Committee of Council; and



(2) the City should have an internal audit function to provide ongoing audit services to the Corporation.



Annual attest audits required under the Municipal Act were conducted by internal staff at the former municipalities of Metropolitan Toronto and the City of Toronto. Attest audits at the former Cities of North York, Scarborough, York and Etobicoke, as well as the Borough of East York were conducted by an external auditor. Internal audit work was conducted by staff at the former Metropolitan Toronto and the former Cities of Toronto and Scarborough. In general terms, other audit related work at the former Cities and the Borough of East York were contracted out to the private sector on an as needed basis and were not a part of an ongoing audit plan or cycle.



The recommendation of the Transition Team represents an audit arrangement which exists in all municipalities in Canada (except Montreal), the former Metropolitan Toronto and the former City of Toronto, a majority of municipalities in the U.S., as well as in major corporations in the private sector.



In order to evaluate the appropriateness of the Transition Team's recommendation, it is important to understand the difference between the two audit processes.



Annual Attest Audits:



Attest audits are designed to permit the expression of a professional opinion on a set of financial statements. The opinion states whether the operations and financial position of the municipality have been presented fairly in compliance with accounting policies generally accepted for municipalities. Under present municipal legislation, statutory attest audit requirements comprise a high level annual audit of the financial statements of the municipality and its agencies, boards and commissions. These audits are designed to give assurance that the financial statements being audited are not materially misstated and that they do not contain inaccuracies or misrepresentations of a magnitude which could significantly mislead a reader of those statements. The auditor determines what is material and this determination impacts significantly on the extent of audit work which is conducted.



Annual attest audit requirements for the City of Toronto will involve the expression of an audit opinion on the following sets of financial statements:



Consolidated Financial Statements of the City of Toronto

City of Toronto Hydro Commission

Toronto Transit Commission

Metropolitan Toronto Coach Terminal, Inc.

TTC Insurance Company Limited

TTC Pension Fund Society

TTC Sick Benefit Association

City of Toronto Sinking Funds

City of Toronto Waterworks System

City of Toronto Library Board

Toronto District Heating Corporation

City of Toronto Parking Authority

Metropolitan Toronto Pension Fund

Metropolitan Toronto Police Benefit Fund

Metro Police Supplemental Pension Benefits Trust Funds

City of York Employees Pension and Benefit Funds

City of Toronto Pension Plan

Toronto Fire Department Superannuation and Benefit Funds

Board of Governors of Exhibition Place

Canadian National Exhibition Association

Canadian National Exhibition Association Foundation

Hummingbird Centre for the Performing Arts

City of Toronto Zoo

City of Toronto Board of Health

Metropolitan Toronto Housing Company Limited

Cityhome

City of Toronto Trust Funds

North York Performing Arts Centre Corporation

City of Toronto Historical Board

Toronto Economic Development Corporation

St. Lawrence Centre for the Arts

The Metropolitan Toronto Convention and Visitors Association

Canada's Sports Hall of Fame



In addition to the above, the Attest Auditor is also required to provide opinions on a significant number of provincial subsidy claims which include the following Homes for the Aged:



Albion Lodge

Bendale Acres

Carefree Lodge

Castleview Wychwood Towers

Cummer Lodge

Fudger Home

Kipling Acres

Lakeshore Lodge

Seven Oaks

True Davidson Acres



Under present legislation, the Attest Auditor is also required to provide audit opinions on approximately 35 Business Improvement Area financial statements. In addition, the Auditor of the former City of Toronto has also provided opinions on approximately 15 Community Centres and Arenas. Audit opinions will also be required on various miscellaneous subsidy claims relating to the Ambulance Division, as well as the Housing Companies.



The extent of the above audit work is significant. In order to minimize attest audit costs, discussions with the Province are underway in connection with the audit requirements of the Business Improvement Areas, in order to ascertain whether or not detailed audits are required. In addition, the audit requirements relating to the Community Centres and Arenas are currently being reviewed. It is suggested therefore, that audit requirements relating to the Business Improvement Areas and the Community Centres and Arenas be excluded from the request for proposal process.







Internal Audits:



Due to the fact that statutory attest audits are carried out at a high level, they provide limited value to the municipality in a proactive management capacity other than assurance of the absence of material error in the reported financial results and financial position. While a management letter may be a product of such an audit, it will not reflect observations based on a systematic and reasonably detailed review of all or even all major program activities of the municipality. Where municipal programs do not have the capacity to generate material dollar value errors, they will likely receive little attention during the mandated audit. Unless specifically requested, the attest audit will not generally address areas which are not considered material, even though they may be politically sensitive. As a consequence, the attest audit provides little support to the governance process. It will not contain any significant evaluation of individual program areas or reported program results unless contracted for specifically apart from the regular audit fee.



All major municipalities in Canada and the US have counterbalanced this deficiency by the extension of audit processes to a more detailed level. This extension is conducted by internal audit staff. The size and complexity of the City of Toronto will make it more difficult for Council to exercise good governance over activities than was the case in any one of the amalgamating municipalities. Consequently, the need for an independent evaluation of program activities reported results and internal control processes will assume even greater importance in ensuring appropriate accountability of management of the City to Council. Thus, there is a need for additional audit processes covering all major program areas within the City if Council, the Chief Administrative Officer and Senior Management is to be in an informed position to make critical decisions related to these programs and the manner in which they are carried out. Certain areas are specifically targeted for audit in a more in-depth manner than would normally occur during an attest audit. They can be targeted for a number of reasons, such as representing or reflecting:



(a) Major cost Centres with potential savings;



(b) Major problem areas to the Corporation;



(c) Specific problems in process, organization or function;



(d) Part of a specific audit cycle approved by Council based upon a structured risk analysis process; and



(e) Areas where fraudulent activities is suspected.



When properly conducted, such reviews can cause or influence departments, commissions and local boards to function more effectively, efficiently and economically. Such actions can result in tangible as well as intangible benefits. Tangible benefits are measurable in financial terms, e.g., staff savings, increased revenue and costs avoided because of audit findings. Intangible benefits cannot be fully or readily measured in financial terms, e.g., improved services to the public, strengthened internal control systems to prevent and detect irregularities, avoidance of fraud and streamlined procedures.



Transitional Audit Requirements:



During the first six months or so, the internal audit function will include a process related to transitional issues. The transitional requirements relate to the termination of operations of the six area municipalities and Metro and the consolidation of those activities into the new City of Toronto. Each of the seven individual municipalities presently has appointed a statutory attest auditor for the 1997 fiscal year. Each auditor is required to report on the financial results of the municipality they have been appointed to audit.



The City Auditor is currently completing the audit of the 1997 financial statements of the former Municipality of Metropolitan Toronto including its local boards, agencies and commissions, as well as coordinating the audit process for the other six amalgamated municipalities.



Comments:



The outsourcing of the attest audit is standard practice at the municipal level and the private sector in both Canada and the US. The reasons for this particular method of delivery of audit services are as follows:



(1) Auditor Independence:



The very purpose and nature of an attest audit is to obtain the independent opinion of the auditor. Independence can be defined as the state of not being influenced or controlled by others in matters of opinion or conduct; thinking or acting for oneself; not subject to another's authority or jurisdiction; and autonomous.



The auditors' opinion on the financial statements increases users' confidence in those financial statements. It is the independent nature of this review and report on management's representations on their financial statements that gives rise to the increased confidence.



The Institute of Chartered Accountants of Ontario "Rules of Professional Conduct" state that the auditor "shall hold himself free of influence, interest, or relationship which impairs his professional judgment or objectivity" or appears to do so to the reasonable observer. This statement reflects the two facets of independence: independence in fact, and independence in appearance. Independence in fact and appearance may best be achieved through engaging an external auditor.



(2) Efficient Use of Resources:



Attest audit opinions on all municipal financial statements are required by April 30 of the following year. This deadline is imposed by the Province of Ontario and the preparation of financial statements by that date at the latest is important. For instance, the Public Sector Accounting and Auditing Board (PSAAB) of the Canadian Institute of Chartered Accountants, in its pronouncement relating to general standards of financial statement presentation requires that financial statements must be issued on a timely basis. PSAAB further states that the usefulness of financial information diminishes as time elapses. In view of the number of financial statements requiring audit opinions by April 30, it is not possible to staff the department to a level which accomplishes this objective and at the same time, keep the same level of staff productive for the balance of the year.



(3) Outsourcing of the Attest Audit allows the Internal Audit function to focus on value added issues:



The outsourcing of the attest audit allows the City Auditor to focus on the pursuit of more value added issues, particularly in the area of value for money projects. The pay back in this area is significantly greater than attest audit work the major focus of which relates to a high level audit of a set of financial statements. The amount of time available for this work would be reduced depending on the level of assistance provided to the external auditors and any attest type work the



City Auditor may be asked to perform on entities such as Community Centres and Business Improvement Areas.



(4) Improved Access to specialized skills and audit technology:



The skills available to a major private sector public accounting firm will likely be of benefit to the City Auditor, particularly in relation to specialized technical knowledge. For example, if the City Auditor requires technical advice on Internet Fire walls on a particular project, this expertise would likely be available from resources within the firm of the attest auditor as opposed to having an expert on staff in a permanent basis.



Staffing Implications:



The 1998 budget of the Audit Department has been based on the recommendations of the Transition Team. However, it is important to note that the 1998 budget year will include work relating to the 1997 attest audit. Due to the outsourcing of the attest audit function, staffing levels will likely be reduced from 50 to 20 by June 30, 1998. Current staffing levels are as follows:





Former*

Metro

Toronto

Former

City of

Toronto

Former

City of

Scarborough





TOTAL
EXCLUDED
City Auditor

1

1

1

3

Directors

1

1

Acting Directors

2

2

Managers

4

3

7

Acting Managers

1

1

2

Project Co-ordinators

10

3

3

16

Administrative Asst.

1

1

Executive Secretary

1

1

19

9

5

33

UNION
Auditor 2

1

1

Audit Clerk 3

4

4

Audit Clerk 5

4

4

Senior Auditor

-

4

4

Auditor

-

2

2

Clerk 2

1

1

2

10

7

17

GRAND TOTAL

29

16

5

50







*Includes the transfer of staff from the Internal Control Division of the Finance Department of the former Metro.



Proposed staffing levels under the new structure will be as follows:



City Auditor 1

EDP Manager 1

Managers 3

Project Coordinators 5

Auditors 9

Executive Secretary 1

20



Of the staff reductions required, it is anticipated that only two individuals will qualify for early retirement. In addition, the department has one temporary employee on staff.



In view of the change in the type of work required, the structure of the Audit Department in the new City of Toronto will likely comprise of staff with professional designations, the majority of whom are currently excluded personnel. There are a number of union staff who possess accounting designations, and as such, will qualify for positions under the new structure. In view of the department's required access to confidential records throughout the Corporation including personnel records, as well as the issue of independence, it is anticipated that staff of the restructured department will all be excluded. This is the general practice in audit departments throughout Canada and the US.



The proposed staff level of 20 is based on an estimate of the potential work load of the department. Benchmark comparisons have been made with other municipalities across Canada and the US, in order to determine the appropriateness of such staff levels. Specific comparisons are as follows:





Municipal

Operating

Budget

Internal

Audit

Costs

Internal Audit Costs

as a % of Municipal

Operating Budget

000's

CANADA
City of Toronto

$6,000,000

$1,747,000

0.03

Ottawa/Carleton

1,100,000

587,000

0.05

Calgary

820,000

1,113,000

0.14

Edmonton

706,000

962,000

0.14

Winnipeg

683,000

627,000

0.09

Ottawa

316,000

600,000

0.19

U.S.
New York

33,400,000

11,520,000

0.03

Los Angeles County

14,300,000

7,700,000

0.05

Houston

4,500,000

740,000

0.02

San Francisco

3,200,000

1,200,000

0.04

Detroit

2,400,000

2,400,000

0.10

Seattle

1,830,000

700,000

0.04







It is difficult to accurately project staff requirements particularly when viewed in relation to potential audit projects brought about by the unprecedented amalgamation of seven municipalities. This level will be constantly evaluated over the next 12 to 18 months, particularly in the context of project requirements. It should be noted that internal audit costs as a percentage of the Municipal Operating Budget will be amongst the lowest in North America at 0.03 per cent.



Budgetary Impact of Restructuring:



As indicated earlier, the 1998 budget of the Audit Department has been prepared on the basis of the recommendations of the Transition Team. The 1998 budget, however, includes costs relating to the completion of the 1997 audits of the amalgamating municipalities so is not representative of a normal year's operating expenditures. In this context, the budgetary impact has been based on a projected 1999 budget. A comparison of costs between 1997 and 1999 is as follows:



1997 Total estimated audit costs of amalgamating municipalities including

local boards, agencies and commissions $4,750,000.00



1999 Estimated attest audit costs of the new City $1,000,000.00

Estimated attest audit costs for local boards, agencies and commissions $750,000.00

Internal audit costs $1,747,000.00



Estimated Total Audit Costs of the new City $3,497,000.00



Reduction in audit costs (26 percent) $1,253,000.00



It is difficult to accurately estimate attest audit costs which are generally affected by:



(a) The complexity and size of the operations;

(b) The number of individual audit opinions that must be issued;

© The materiality level used in designing the audit work;

(d) The adequacy of management and procedural controls; and

(e) The assistance provided by an internal audit function.



(1) The Complexity and Size of the Operations:



From a mandated audit standpoint, complexity relates to how many revenue, expenditure and other accounting systems and sub-systems exist within the organization. In the case of the New City, the expenditure and revenue process will have a number of major aspects which will require individual attention. These will include for example, the Police Services Board, the administration of General Welfare Assistance, the issue and control of parking tags, the collection and control of parking tag revenues, tax revenue including the collection thereof, and other fees and services charges. The magnitude of certain of the revenue items is significant. The total taxation revenue, for example, will be almost $2.7 billion. In the case of fees, service charges, investment income and miscellaneous income, the total revenue is almost $1.3 billion.



(2) The Number of Individual Audit Opinions that must be Issued:



The extent of audit work must be designed specifically to ensure that the financial statements are not materially misstated. Consequently, when an individual audit opinion is required on any component of the organization, additional audit work over and above work on the organization as a whole has to be done, as well as specific work related to the actual production of the audit opinion. Because of the City's size and range of programs, far more individual opinions will be required than for other governments.



The extent of the required audit opinions at the New City of Toronto is an issue that requires resolution. This area is currently being reviewed.



(3) The Materiality Level Used in Designing the Audit Work:



One of the most significant and least understood issues relating to the audit process is the materiality level used in an audit. A definition of materiality in an audit context is as follows:



"The magnitude of an omission or misstatement or the aggregate thereof that, in the light of surrounding circumstances, makes it probable that the judgement of a reasonable person relying on the financial statements would have been changed or influenced by such omission or misstatement or the aggregate thereof."



In performing audit work, auditors have to ensure that they have done sufficient work to ensure that financial statements are not materially misstated. A determination of what is material in a financial statement audit context is not an entirely straightforward process and is dependent on a number of issues such as audit risk and the size and complexity of the organization.



The lower the materiality level used, the more audit work has to be performed. This does not mean simply extending the test processes but also involves reviewing more areas of the operation.



(4) The Adequacy of Management and Procedural Controls:



The extent of audit work is also governed by the adequacy of management and procedural controls. An initial evaluation of such controls is important prior to a determination of the extent of audit testing. Additional audit work will be required if internal controls are weak. This will be a critical issue during the early stages of the New City particularly as new controls are introduced to the administrative processes. The City Auditor is currently conducting ongoing control reviews at various locations throughout the City.



(5) The Assistance provided by an Internal Audit Function:



Cooperation and coordination between the external and the internal auditor are essential in order to avoid duplication and reduce the overall costs of both types of audits. Specific assistance can be provided by the internal auditor during the attest audit. The extent of the assistance provided would be mutually agreed between both parties in consultation with the audit committee. The cooperation between the two groups can be mutually beneficial provided the internal auditing function is not viewed as an extension of the attest audit and the internal auditor is not viewed as a permanent resource of the external auditor.



Proposed Timetable:



It is anticipated that all 1997 attest audits will be completed by June 30, 1998, and that the restructuring of the audit function will be in place by that time. The 1998 budget of the department has been compiled on this basis.



A specific timetable relating to the proposal process is as follows:



Council Approval of Report April 15

Issue of Request for Proposal April 20

Response to Request for Proposal May 1

Selection of Attest Auditors May 15

Council Approval of Attest Auditors June 3



Outsourcing of the Internal Audit Function:

While the outsourcing of the financial attest audit is by far the most common method of service delivery for the majority of municipalities in Canada and the US, the outsourcing of the internal audit function to the best of our knowledge, has not occurred in any municipality in Canada. In addition, we are not aware of any significant outsourcing in the US. The US National Association of Local Government Auditors has over 250 municipalities as members which would seem to indicate that the vast majority of US major municipalities have a significant internal audit resource. However, it should also be noted that municipalities which do not have an internal audit function contract out specific audit projects on an as needed basis. This, however, is not a substitute for an effective internal audit function which includes an ongoing evaluative audit process, particularly in the case of an organization, the size and complexity of the new City of Toronto.



Current audit staff at the new City of Toronto have significant municipal experience and a unique perspective gained through their ability to see all parts of the municipality. It is this broad integrational view that gives audit staff its uniqueness and enhances its ability to effectively add value to the organization - whether that value be in the improvement of controls or through the identification of operational risks and potential solutions. These advantages would be lost if an internal audit process was contracted out to a third party. Further, there would be significant new start up costs to bringing new employees up to speed to perform internal auditing in the municipality.



There is also an argument that outsourcing providers will command an ever increasing premium for their services. It is possible that the outsourcing municipality will become dependent on the service of the outsourcing provider. As the dependency increases, the municipality becomes vulnerable to pricing increases as the outsourcer assumes more of a monopoly position especially if the provider gains more "institutional" knowledge about the municipality. The counter argument is that:



(a) there are other outside providers; and

(b) long term pricing agreements can be reached.



Nevertheless, in spite of the above, there may be instances where it makes sense to "partner" with an outside provider, particularly when outside expertise is required on technical issues such as EDP security for example. In actual fact, the department is currently working with an external consultant in relation to security issues pertaining to the Client Identification Benefits System in the Social Services Division of Community Services. Rather than staff the department with a wide range of technical expertise, the outsourcing of specific audit related functions may be more appropriate, and in fact, should be accepted practice.



Proposed Contract with the Attest Auditor:



The Municipal Act provides that the contract term relating to the hiring of an attest audit should be no longer than five years. In view of the significant up front investment required by the attest auditors in an organization as complex and as large as the City of Toronto, it is suggested that consideration be given to awarding a contract for a five-year period. This practice is not unusual in the municipal sector in regard to the awarding of audit contracts. In addition, it is likely that the annual fee for a term of five years would be less than a term of say three years.



The Audit of the Auditor:



A frequently asked question relating to any internal audit function is "Who audits the Auditor?". This is a valid question as the auditor should be subjected to the same level of scrutiny/accountability as the entities audited.



The Audit Department would be subjected to the same attest audit process as other departments at the City. However, as indicated previously, attest audits by external public accountants are conducted at a high level and depending on the scope of the audit, little specific work would be conducted on many of the smaller departments, including the Audit Department. In order to compensate for this, it is suggested that the City Auditor be subjected to a peer review process.



The City Auditor is a member of the Canadian Municipal Comprehensive Auditors Association (CMCA) and the US based National Association of Local Government Auditors (NALGA). An important component of each organization is a formalized peer review process which encourages members to participate in an arrangement whereby different audit organizations review the operations of other member organizations. The CMCA has prepared guidelines for the Professional Practice of Municipal Internal Auditing, pertaining to independence, professional proficiency, scope of audit work, performance of audit work and management of the internal audit office. In addition, NALGA has prepared a quality control review guide and members have been organized and trained to conduct peer reviews of audit organizations.



It is anticipated that the City of Toronto Auditor would participate in the peer review process of either the CMCA or NALGA.



In addition, in the early 1980's, the members of the Institute of Chartered Accountants of Ontario approved the introduction of a program whereby every member practicing public accounting in Ontario would be inspected.



The main purpose of practice inspection is to ensure that all members in the practice of public accounting maintain an appropriate level of professional standards. Primarily, the practice inspection program is intended to be educational - to help practitioners improve their professional standards, where necessary. Essentially, through a review of current accounting and audit engagement files, practice inspection identifies where a practicing member may require assistance in maintaining prescribed professional standards. The practice inspection program does not set new standards. Rather, the standards that a member is expected to maintain are those prescribed by the Canadian Institute of Chartered Accountants Handbook and the Institute of Chartered Accountants in Ontario Handbook.



Where the City Auditor is engaged in the practice of public accounting, the City Auditor should be subject to Practice Inspections.



Conclusions:



The restructuring of the audit function will result in a reduction of staff from 50 to 20. Assuming the estimate of fees of $1,750,000.00 relating to the outsourcing of the attest audit is reasonable, the restructuring will also result in an annualized savings of approximately $1,253,000.00 from the audit function that existed prior to amalgamation. In addition, the new City of Toronto will have an audit resource 100 percent devoted to value added projects, a situation which did not exist in all of the individual amalgamating municipalities.



Contact Names and Telephone Numbers:



Jeffrey Griffiths, 392-8461

Wanda Liczyk, 392-8773



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(Communication dated March 20, 1998,

addressed to the Audit Committee from Denis Casey,

Acting President, Local 79, Canadian Union of Public Employees)



This report proposes changes to the Audit Department. It recommends that the attest audit responsibilities be contracted out and that the rest of the audit functions be carried out by managerial staff only.





This is a disappointing and shocking statement about the new City's view of the value and worth of its 25,000 front-line staff. CUPE Local 79 represents unionized employees from the former Municipality of Metropolitan Toronto and the former City of Toronto. Our members have been carrying out attest and internal audits for both former Corporations for over fifty years. These employees are part of a long tradition of neutrality and independence which has ensured an open and democratic process.



The proposed internal audit budget will be the lowest in Canada (on a percentage basis). But the new City is bigger and more complicated than ever before. We know that each former municipality has widely differing policies and procedures which must be integrated. There are necessary and unavoidable costs when undertaking such an enormous task for the first time. The budget must reflect these realities, otherwise the value -- and integrity -- of the audit process is at risk, as is our responsibility to the taxpayer.



The new work plan for the remainder of the audit functions is disturbingly vague. It would appear that only certain areas will be audited. The extent and adequacy of management and procedural controls throughout the City are unknown. During this period of change and attempted harmonization, decisions about these important matters should be made by City staff who understand the Corporation. It makes no sense to reduce the department by sixty percent before the true extent of the work level has been determined.



Only 20 staff will be left in the department and they will all be excluded from union membership. At a time when the Corporation is emphasizing the need to flat-line and decrease management levels, there will be no front-line workers in this department. Confidentiality is not a reason to exclude them: their integrity and respect for the confidentiality required to perform this independent function have never been in question.



It is proposed that the new Audit Department will employ only those with professional designations, such as CA (Chartered Accountant) or CGA (Certified General Accountant). There has always been a practice that combinations of education, training and experience are considered as equivalencies. There are front-line employees who have the technical expertise and experience gained from working on the job. Some have been with local government and Audit for more than twenty years. The lack of recognition of their acquired skills is an insult to the commitment they have made to the Corporation. The introduction of credentialism is a step backwards in achieving employment equity in the City.



Local 79 urges Audit Committee members to reject this report. The contracting out of the attest audit, exclusion of union members from the new Audit Department, and introduction of credentialism are serious issues, whose impact will have far-reaching implications on the City's finances and labour relations. Instead, we ask you to affirm your support of union and management staff working together to provide responsible and sufficient audit services to the City.



--------



(Report dated March 16, 1998, addressed to the

Audit Committee from the Auditor of the former City of Toronto)



Recommendation:



It is recommended:



(1) That City Council confirm the following responsibilities, which have been duties of the City Auditor of the City of Toronto prior to amalgamation, shall continue to be responsibilities of the City Auditor (and not responsibilities of external auditors hired to report on the Corporation's financial statements) for 1998 and future years:



(a) the receipt of confidential minutes of third party organizations which have agreed to provide minutes of their board meetings to the City Auditor;



(b) the accessing and examination of the books, records and other information of third parties providing goods or services to the City, who have agreed in their contracts with the City to make such information available to the City Auditor; and



(c) the audit for compliance with the terms and conditions of licences and permits issued by the City, or persons or organizations which have received such a licence or permit.



Background:



In accordance with the recommendations of the Transition Team, as adopted by City Council, the City is to have both an internal audit services function headed by a City Auditor, and to have external auditors appointed by City Council to audit the annual financial statements of itself and its local boards.



Over the past years there have been put in place by the former City of Toronto, arrangements or conditions which refer to the City Auditor, providing for that person to receive confidential information on a regular basis, or to have access to the books and records of specific persons or organizations. In addition, relating to permits and licences issued by the City as part of municipal governance, it had been found useful for the City Auditor on occasion to audit for compliance with the terms and conditions of such permits and licences.



This report suggests it would be appropriate and useful for City Council to determine publicly how those kinds of responsibilities shall be exercised this year and in future. This is because the external auditors will be appointed in accordance with legislative provisions, set out in the Municipal Act, requiring municipalities to appoint auditors. In the absence of a clear determination by City Council that "City Auditor" in such agreements refers to the head of its internal audit services unit, a concerned organization might choose to deal only with the legislatively appointed external auditors. This might be onerous for such auditors, and perhaps costly and of uncertain effect for the City.



Comments:



Where the City has continuing interests in the plans and operations of third party organizations, such as the Toronto Arts Council or the Toronto Harbour Commission, such that the parties have made binding arrangements to provide their minutes of meetings to the City Auditor but not for publication, it would be best for this information to continue to be provided to an official within the municipal corporation having continuing high level knowledge of the City's affairs. The information does not have to be accessed in the course of auditing the City's financial statements, so there is no problem for external auditors if this kind of arrangement is continued with the City Auditor.



Where it is standard practice in every consultant agreement and every grant agreement with the City to provide for the City Auditor to have access to books and records of the signators to such agreements, it would clearly be most practical and most economical to continue to understand such references are to the City Auditor and not to the external auditors. Similarly, where leases include rents based on gross receipts or other factors and provide for the City Auditor to have access to lessee's books and records, it will be most practical and economical to continue to understand the leases referred to the City Auditor and not the external auditors.



In the many cases where the City might like to have a third party audited for compliance with the terms and conditions of permits to hold activities on City owned property, or for compliance with terms of other licences, then again it is most practical and economical to ask the City Auditor to do such checking, rather than external auditors.



However, there are cases where there are trust funds held by the City, which it is appropriate to audit and report on, at least once a year. Those would be attest auditors, certifying the accuracy and completeness of financial records maintained by the City itself. Here it is best and most certain to have the external auditors include such trust funds in their audits of City financial statements. No suggestion is made in this report to do otherwise.



Because the City intends to appoint external auditors for certain purposes, and these auditors could reasonably be understood to be, when appointed, the auditor of the city, this report recommends that City Council make a clear-cut decision on three areas of responsibility, to have them continued by the head of the City's internal audit services unit.



Respectfully submitted for your information and consideration.



The Strategic Policies and Priorities Committee also submits the following communication (April 6, 1998) from Mr. Denis Casey, Acting President, Canadian Union of Public Employees, Local 79:



This report recommends that the attest audit responsibilities of the Audit Department be contracted out and that the rest of the audit functions be carried out by managerial staff only. At its meeting of March 24, 1998, the Audit Committee supported the contracting-out of the attest audit.



This report is a disappointing and frightening signal to the 25,000 unionized employees in the new City of Toronto. At a time when the Corporation is proclaiming its goal of decreasing management levels in all areas, this department will have no front-line workers.



CUPE Local 79 represents union employees from the former Municipality of Metropolitan Toronto and the former City of Toronto. Our members have been carrying out attest audits for both former Corporation for over 50 years. Their integrity and respect for the confidentiality required to perform this independent function have never been questioned.



We are opposed to the contracting-out of the attest audit. We believe that its importance and value to the City are under-estimated. City staff who understand the complexities of municipal government should be carrying it out. Having experienced staff ensures compliance with municipal procedures, by-laws, City policies and federal and provincial regulations.



The extent and adequacy of management and procedural controls throughout the City are still unknown. Presently there are seven separate systems in place. There are no uniform standards. In the former City and Metro, front-line staff carry out attest audits and document and evaluate internal controls. But the range of internal controls in five of the former municipalities is unclear. If these controls are weak then the report acknowledges that "additional audit work will be required". It also confirms that even with the introduction of outside auditors, much assistance by City staff will be needed.



Yet all the expertise of the front-line staff who carried out this valuable work in the former City of Toronto and Municipality of Metropolitan Toronto will be lost as a result of the recommendation to contract-out. Instead, unionized staff will be replaced with more highly paid managers, without the same level of familiarity and experience in field work.



The auditing of the agencies, boards and commissions is not being included in this proposal. This work generated $1.2 million in recoveries in 1997. It is not clear will be left to carry it out in the future.



During this period of change and attempted harmonization, Councillors should be wary of having the cheapest internal audit budget in Canada (on a percentage basis). The new City is bigger and more complicated than ever before. There are necessary and unavoidable costs when undertaking such an enormous task for the first time.



The City has knowledgeable staff who are experienced in dealing with the complexities of municipal audits. Local 79 urges Members to reaffirm the Corporation's commitment to the value and worth of its front-line staff. We ask you to reject the recommendation to contract-out the attest audit function.



--------



Mr. Denis Casey, Acting President, CUPE Local 79, appeared before the Strategic Policies and Priorities Committee on April 7, 1998, in connection with the foregoing matter:



(City Council on April 16, 1998, had before it, during consideration of the foregoing Clause, a communication (April 15, 1998) from the Acting President, Canadian Union of Public Employees, (CUPE) Local 79, expressing concerns regarding the contracting out of audit services.)





11

Resolution - Business Education Tax Rate in Ontario



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 11 of Report No. 4A of The Strategic Policies and Priorities Committee.)





12

Provincial Property Tax System



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 12 of Report No. 4A of The Strategic Policies and Priorities Committee.)





13

Proposed New Municipal Act - Ministry of Municipal Affairs

and Housing Consultation Document



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 13 of Report No. 4A of The Strategic Policies and Priorities Committee.)



14

Toronto City Council's Response to Draft

Greater Toronto Services Board Act



(City Council on April 16, 1998, amended this Clause by adding thereto the following:



"It is further recommended that City Council request the Provincial government to integrate all GO Transit Board functions within the mandate of the Greater Toronto Services Board.")



The Strategic Policies and Priorities Committee recommends the adoption of the following report (April 2, 1998) from the Chief Administrative Officer:



Purpose:



The purpose of this report is to recommend a formal Toronto City Council response to the provincial government's draft legislation for the establishment of a Greater Toronto Services Board (GTSB).



Funding Sources, Financial Implications and Impact Statement:



The recommendations in this report have no financial implications.



Recommendations:



It is recommended that:



(1) Council support the establishment of a GTSB as constituted in the Proposed Greater Toronto Services Board Act released by the Minister of Municipal Affairs and Housing on March 12, 1998 subject to the following recommendations and comments;



(2) The provincial government be requested to amend Part I of the Proposed Greater Toronto Services Board Act to vest authority in the GTSB to do any or all of the following:



(a) prepare a GTA urban structure plan and master plans for major inter-regional infrastructure, for example, sewer, water, and transportation;



(b) allocate Provincial funding to GTSB member municipalities for inter-regional projects and programs consistent with the GTA urban structure and infrastructure master plans;



(c) approve, or appeal to the approval authority, environmental assessments for major inter-regional infrastructure based on consistency with the GTA urban structure and infrastructure master plans; and



(d) support or appeal land use decisions to the approval authority, including the Ontario Municipal Board, based on consistency with the GTA urban structure and infrastructure master plans;



(3) the provincial government be requested to review the relationship of GT Transit to the GTSB with a view to ensuring that their respective responsibilities and powers in regard to the design, construction and operation of the regional transit system are clearly defined and distinct. This review should include consideration of the option of increasing the City of Toronto's representation on GT Transit to 50 per cent;



(4) Council inform the Minister of Municipal Affairs and Housing that the City of Toronto opposes the method of levy apportionment based on weighted assessment, as set out in clause 19 (2) of the Proposed Greater Toronto Services Board Act, and request the provincial government to work with City staff to identify alternative approaches to levy apportionment by the GTSB;



(5) that the provincial government amend the proposed Greater Toronto Services Board Act by removing the GTSB's power to directly access financial markets;



(6) this report be forwarded to Mr. Alan Tonks, the Minister of Municipal Affairs and Housing, all Regional and Area Municipal Councils in the GTA and the Council of the Regional municipality of Hamilton-Wentworth as the City of Toronto's response to the proposed Greater Toronto Services Board Act; and



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



Council Reference/Background/History:



In February, 1995 the previous provincial government established the Greater Toronto Area (GTA) Task Force with a mandate to make recommendations on a wide range of matters including governance of the GTA. The Task Force released its final report in January, 1996, in which it recommended the elimination of the Metro and regional governments and the establishment of a GTA authority.



A provincial review panel, chaired by Libby Burnham, reported on May 6, 1996 that there was very little consensus on the GTA Task Force recommendations other than on the need for co-ordination in the GTA. Subsequently, on May 30, 1996, the provincial government established the Who Does What Panel, chaired by David Crombie. The Panel reviewed the distribution of responsibility for delivery and funding of the full range of municipal services and examined municipal finance and governance. The Panel submitted its recommendations to the Minister of municipal Affairs and Housing in a series of letters throughout the summer and fall of 1996. With respect to GTA governance, the Panel recommended the creation of a Greater Toronto Services Board, elimination of the regional municipalities and consolidation of member municipalities into strong cities including a strong urban core for the GTA.



The provincial government responded to these recommendations with the introduction of Bill 103, the City of Toronto Act, on December 17, 1996. At the same time, the Minister of Municipal Affairs and Housing announced the appointment of Mr. Milt Farrow as Special Advisor on the formation of a Greater Toronto Services Board. Mr. Farrow was asked to undertake consultation and advise the Minister on: the GTSB's powers; how it should be governed; what types of services it should concern itself with; how it should be funded; and what relationship it should have with municipalities, the public and the province.



Mr. Farrow released his final report, entitled "Getting Together," on June 18, 1997. Mr. Farrow proposed that a GTSB be set up as a statutory corporation. All upper, lower and single tier municipalities in the GTA would be members. Hamilton-Wentworth would be a member only with respect to the GTSB's involvement in GO Transit. The GTSB's decision-making and executive arm would be a 28 member Executive Committee, half of whose membership would initially be drawn from the new City of Toronto. Three representatives from Hamilton-Wentworth would be added to the Executive Committee when issues relating to GO Transit were on the agenda. The Executive Committee would receive input from and link to the GTSB's membership through an Urban Issues Advisory Committee and a Rural Issues Advisory Committee. All member municipalities would sit on one of these two committees.



Mr. Farrow recommended that, initially, the GTSB should have four primary roles. These would be:



(1) development of a comprehensive, long-term Infrastructure Co-ordination Strategy for the GTA;



(2) provision of a discussion forum and liaison with all levels of government;



(3) resolution of inter-regional servicing issues when consensus among municipalities cannot be reached in areas such as water and sewage treatment, inter-regional transit and watershed management. The GTSB would implement decisions and allocate costs; and



(4) operation of GO Transit and development of a long-term, post collection waste management strategy for the GTA.



On December 11, 1997 the Toronto Transition Team released its Final Report, in which it recommended that the new Toronto City Council, "recognizing that Greater Toronto is one economic, social and environmental region, should impress on the Province the importance of creating the Greater Toronto Services Board (GTSB) as soon as possible to provide a forum for building a strong city-region in partnership with other municipalities in the Greater Toronto Area."



The Transition Team proposed that the GTSB should have a mandate "to coordinate city-region growth and infrastructure investments and take joint action on such shared interests as watershed planning and development of a solid waste strategy."



On March 12, 1998, the provincial government published draft legislation to provide for the establishment of a GTSB. The Minister of Municipal Affairs and Housing announced that the government intends to introduce a Bill for First Reading in the spring sitting of the Legislature. An information bulletin from the CAO, enclosing a message from the Minister of Municipal Affairs and Housing, a news release announcing the draft legislation, and a backgrounder describing the highlights of the draft legislation, was circulated to all Members of Council on March 13, 1998.



The province has appointed Mr. Alan Tonks, former Chair of the Toronto Transition Team and Metro Council, to moderate a review of the draft legislation. The Minister of Municipal Affairs and Housing has requested all municipalities in the GTA to provide comments on the draft legislation to Mr. Tonks.



This report recommends a formal Toronto City Council response to the draft legislation.



Comments and/or Discussion and/or Justification:



Under the proposed legislation, the GTSB is established as a corporation without share capital. It is not a municipality and is explicitly stated not to be a local board The objects of the GTSB are two-fold:



(i) to promote co-ordinated decision making among municipalities in the GTA; and



(ii) to supervise the management of the Greater Toronto Transit Authority ("GT Transit") and allocate the costs of that authority, in accordance with the Act.



The powers of the GTSB in respect of these two roles are summarized in the Appendix to this report.



Establishment of a Greater Toronto Services Board:



The GTA Task Force, Burnham Review Panel, Who Does What Panel, Milt Farrow Final Report and the Final Report of the Toronto Transition Team all concluded that there is the need for an institution to deal in a unified and coordinated way with the problems facing the GTA. Legislation to create the GTSB is a step in the right direction.



Other forums to discuss GTA issues do exist. These include the GTA Mayors' and Regional Chairs' Committee and the Greater Toronto Coordinating Committee under the auspices of the provincial Office for the Greater Toronto Area. These forums have generally only been successful where the Councils of the affected municipalities could reach a mutually beneficial agreement, often with provincial subsidies provided as an incentive. They have failed to resolve major issues related to growth management in the GTA. In addition, they lack formal powers or even the formal accountability structures to be persuasive.



The GTSB will provide a more balanced forum for the debate of GTA issues. Its representative structure and legislated mandate will provide a more accountable means for setting and addressing the region-wide agenda than groups such as the GTA Mayors' and Regional Chairs' Committee. It is recommended that Council support the establishment of a GTSB as constituted in the Proposed Greater Toronto Services Board Act released by the Minister of Municipal Affairs and Housing on March 12, 1998 subject to the following comments.



Growth Management Issues:



Ensuring that growth proceeds in a manner that respects the natural environment and provides for efficient, cost effective use of infrastructure and public resources is a primary challenge for the GTA. Effective growth management in the GTA requires coordinated decision making in the provision of infrastructure and services and development of land. This, in turn, requires that problems be identified and addressed in the context of the GTA as a whole and that there be authority to implement the recommended actions.



Under Part I of the draft legislation, the powers of the GTSB (other than in respect of GO Transit) are advisory in nature. The GTSB will have the power to "promote", "advise", "act as a liaison", "facilitate" and "provide a mechanism", but not to implement or compel implementation of its decisions. Therefore, the extent to which decisions of the Board relating to growth management are implemented will be dependent on the adoption of the decisions by the affected municipalities.



To some degree, this inherent weakness in the GTSB may be mitigated if decisions or other strategies of the Board are recognized in other processes, for example, provincial policy statements or consideration of planning issues by the Ontario Municipal Board (OMB). Because of its legislated mandate, this is more likely to occur with resolutions by the GTSB than other existing ad hoc committees. However, it is not certain to happen.



The GTSB's powers under Part I need to be enhanced to make it more likely that the decisions of the GTSB will result in coordinated growth management, including greater coordination in infrastructure use and investments and economic development in the GTA. It is recommended that the provincial government be requested to amend Part I of the Proposed Greater Toronto Services Board Act to vest authority in the GTSB to do any or all of the following:



(a) prepare a GTA urban structure plan and master plans for major inter-regional infrastructure, for example, sewer, water, and transportation;



(b) allocate Provincial funding to GTSB member municipalities for inter-regional projects and programs consistent with the GTA urban structure and infrastructure master plans;



(c) approve, or appeal to the approval authority, environmental assessments for major inter-regional infrastructure based on consistency with the GTA urban structure and infrastructure master plans; and



(d) support or appeal land use decisions to the approval authority, including the Ontario Municipal Board, based on consistency with the GTA urban structure and infrastructure master plans.



GT Transit Authority:



The draft legislation proposes the creation of an initial seven member GT Transit Authority as a separate but subsidiary body to the GTSB. The legislation sets out the respective roles of each with respect to the operation of GO Transit. Although the GTSB clearly has authority in regard to budget matters, the draft legislation appears to assign almost identical responsibilities to both boards, with respect to the operation of GO Transit. This leads to a concern that the distinctions between their responsibilities in regard to design, construction and operation of the regional transit system may become blurred in practice.



While many of their responsibilities are similar, the proposed composition of the GTSB and the GT Transit Authority are very different. For matters related to GO Transit, the GTSB will have 31 members, 14 from the City of Toronto, 14 from the 905 Regions, 2 from Hamilton-Wentworth, and a Chair. Initially, the GT Transit Authority will comprise seven members, one each from the City of Toronto, the four GTA regional municipalities and Hamilton-Wentworth and a Chair. After its initial term the Authority may consist of six or seven members depending on the election of the Chair. In either case the City of Toronto will have only one vote on the Authority.



The different composition of the two agencies creates a significant potential for political conflict. There may be a number of substantive issues on which the City and the 905 Regions adopt different positions. Based on their respective membership composition, the Transit Authority may vote in favour of 905 interests and the GTSB in favour of City interests. For example, the 905 Regions may support increased express train service with fewer stops within the City. However, as the City is responsible for almost 50 percent of the operating deficit it may support the opposite position. It would be appropriate for City representation on the GT Transit Authority to be proportional to its representation on the GTSB.



It is recommended that the provincial government be requested to review the relationship of GT Transit to the GTSB with a view to ensuring that their respective responsibilities and powers in regard to the design, construction and operation of the regional transit system are clearly defined and distinct. This review should include consideration of the option of increasing the City of Toronto's representation on GT Transit to 50 per cent.



Financing Issues:



The draft legislation's provisions concerning the GTSB's ability to finance its proposed responsibilities give rise to several issues. These issues include the manner in which the GTSB apportions costs and is able to levy a charge against member municipalities, and implications for the management of debt.



Ability to Levy the Member Municipalities:



While the draft legislation does not provide the GTSB with the authority to tax directly, it proposes that the GTSB would levy against the Regions of Durham, Halton, Peel and York and the City of Toronto an amount sufficient to pay the estimated operating costs of the GTSB. These levies would be apportioned among the GTA municipalities in accordance with the legislation and the monies owed by the GTA municipalities under this levy would constitute debt of the municipalities.



With respect to GT Transit, the GTSB would be able to impose two levies on its member municipalities (including the Region of Hamilton-Wentworth):



(i) to cover the amount by which the cost of operations and non funded liabilities exceed revenues; and



(ii) for the cost to the GTSB of capital borrowing for GT Transit.



These levies would constitute debt of the member municipalities.



Levy Apportionment:



The method of levy apportionment, as set out in clause 19(2) of the draft legislation, would be based upon the total weighted assessment of each of the member municipalities in proportion to the total weighted assessment of the GTA. This method bears no relation to the issue of affordability and ability to pay or to the amount of service that would be utilized by the residents of a municipality. If this method is used to apportion debt obligations and debt charges, it could have negative implications for Toronto's could impair credit rating since the City could be responsible for a level of debt that is in excess of its capacity and impair the City's ability to issue debt for other projects.



In time, if the GTSB's role evolves to encompass a broader range of responsibilities, the balance of whose benefits are broadly distributed across the GTA, including the City of Toronto, a system of levy apportionment based on weighted assessment may make sense. At present such an approach is not in the City's best interest. It is recommended that Council inform the Minister of Municipal Affairs and Housing that the City of Toronto opposes the method of levy apportionment based on weighted assessment, as set out in clause 19 (2) of the Proposed Greater Toronto Services Board Act, and request the provincial government to work with City staff to identify alternative approaches to levy apportionment by the GTSB.



Borrowing for Capital Purposes:



The draft legislation provides for the GTSB to be permitted to borrow for GT Transit's capital requirements (not including operating) with the passage of a by-law by a 2/3 majority of the Board. Clause 47 (c) establishes that the GTSB has the power to borrow money to fund the capital requirements of GT Transit and issue debentures, subject to the Ontario Municipal Board Act. Under clause 47 (d), the GTSB also has the authority to direct one or more member municipalities to pay money to GT Transit in respect of its capital requirements and it is assumed that these municipalities will probably be issuing debt to finance these contributions. Thus, it appears that the legislation is contemplating a two-stage procedure whereby the GTSB will require its members to issue debt to provide some initial start-up capital and will then enter the financial markets on its own behalf in the future after it has had an opportunity to establish some credibility with potential investors and the credit rating agencies.



Until it becomes clearer how the GTSB's role within the GTA is going to evolve, it should not have direct borrowing powers as these could bring instability to financial markets and impair the flexibility of member municipalities with respect to the issuance of debt. Therefore, it is recommended that the provincial government amend the proposed Greater Toronto Services Board Act by removing the GTSB's power to directly access financial markets. Instead, the Board should determine its capital financing requirements and request funding from the member municipalities which would have the flexibility to raise the funds from reserves, current operations or the issuance of debt. This method could create more flexibility for the members who would not be subject to paying future debt charges which they cannot control and could substitute various forms of capital depending upon their individual circumstances. This would require the GTSB to have some "levying powers" as provided for in the draft legislation..



Conclusions:



Numerous studies have concluded that there is a need to recognize that the GTA is an integrated and inter-dependent social and economic city-region. These studies have pointed to the need to coordinate the planning and development of infrastructure across the GTA. The proposed Greater Toronto Services Board Act represents the culmination of many years of research and much debate. The debate has been punctuated by many disagreements, some of them profound.



Milt Farrow attempted to reconcile these disagreements in his 1997 proposal for a GTSB. The draft Act provides for a more modest version of the GTSB than that proposed by Mr. Farrow. Comments by some municipalities suggest that even this compromise model goes too far for them.



The proposed GTSB may not be perfect, but it is a starting point and should be supported. It presents a window of opportunity to establish a representative political body that has a legislated mandate to begin to deal with GTA issues. It has taken many years to reach this stage. If the opportunity to create the GTSB is not grasped now, it may not be available for many more years. Yet the problems of uncoordinated growth and inefficient investment in the GTA and their implications for the City of Toronto and, ultimately, the entire city-region, will not disappear.



It is recommended that this report be forwarded to Mr. Alan Tonks, the Minister of Municipal Affairs and Housing, all Regional and Area Municipal Councils in the GTA and the Council of the Regional municipality of Hamilton-Wentworth as the City of Toronto's response to the proposed Greater Toronto Services Board Act.



Appendix



Powers of the Greater Toronto Services Board

(as proposed in draft legislation of March 12, 1998)



Under the legislation, the Board is established as a corporation without share capital. It is not a municipality and is explicitly stated not to be a local board. While it is a corporation, only certain provisions of the Corporations Act (for example, relating to retention of documents and the keeping of records and accounts) apply. The objects of the Board are two-fold:



(a) to promote co-ordinated decision making among municipalities in the GTA, and



(b) to supervise the management of the Greater Toronto Transit Authority ("GT Transit") and allocate the costs of that authority, in accordance with the Act.



The Board's Powers other than in respect of the GT Transit:



As the explanatory notes to the draft legislation indicate, it is not intended that the Board be another level of government and it would not have direct taxation authority. Its powers in respect of the first object stated above, as enumerated in the draft Act, would be to:



(a) promote coordinated decision-making among and develop advisory strategies for municipalities within the GTA with respect to the provision of infrastructure and the optimal use of infrastructure;



(b) advise municipalities within the GTA with respect to making major infrastructure investments;



(c) act as a liaison among the municipalities within the GTA and between municipalities within the GTA and other municipalities, the Government of Ontario or the Government of Canada;



(d) facilitate the efficient and cost-effective resolution of matters of intermunicipal concern within the GTA, if asked to do so by the affected municipalities;



(e) provide a mechanism for the co-ordination of economic development within the GTA; and



(f) promote co-ordinated decision-making among and develop advisory strategies for municipalities within the GTA with respect to the administration and costs of their social assistance and social housing programs.



In general, as is clear from the list of enumerated powers, the powers are advisory or in the nature of facilitation and there is no ancillary approval function nor any other governmental by-law making or directory power which can implement any decision of the Board. While it is stated that the Board has the powers of a natural person for the purpose of carrying out its objects and authority (allowing it, for example, to enter into contracts relating to the above), this would not extend to any governmental power mandating actions to be taken by others. By explicit provisions, the natural person power is stated, among other matters, not to include the ability to incur a debt or to impose fees or charges unless specifically provided for.



The extent to which the Board's advisory strategies could be implemented, therefore, would be dependent on the extent to which such strategies are given recognition under other processes (for example, within Provincial policy statements or planning considerations by the OMB under the Planning Act).



The exceptions to the lack of any governmental by-law making powers of the Board are the statutory directives that the Board must pass by-laws relating to remuneration of the chair, reimbursement of members and a levy by-law against the City of Toronto and the Regions of Durham, Halton, Peel and York ("GTA municipalities") sufficient to cover the Board's operating costs. The levy is apportioned among the GTA municipalities and is separate from any levy in respect of GT Transit.



Certain provisions in the Municipal Act, Municipal Conflict of Interest Act and Municipal Freedom of Information and Protection of Privacy Act are made applicable to the Board. Examples are:



(a) powers to be exercised by by-law;



(b) the requirement for open meetings;



(c) delegation of administrative matters to committees or employees;



(d) fixing the fiscal year;



(e) retention of documents; and



(f) provision for issuance of debentures, making of investments and maintaining reserve funds.



In respect of the last example, the Board is by a specific provision deemed a municipality for the purpose of any the pertinent financial restrictions made by regulation under the Municipal Act.



Given the nature of the enumerated powers given to the Board under this part of the legislation, it is questionable why its powers must be exercised by by-law as opposed to resolution.



GT Transit and the Board:



Under Part II of the draft legislation, a two tier system for operation and supervision of the regional transit system is established. GT Transit is established by the proposed Act. Its powers are operational (for example, to acquire equipment and construct the system). The Board's powers are supervisory (for example, approving routes, frequency of service and establishing fares) as well as financial (e.g., approving GT Transit budgets, issuing debentures, levying the necessary funds from member municipalities).



The objects of GT Transit are listed as:



(a) To operate a regional transit system serving the regional transit area and serving other municipalities from time to time by agreement.



(b) To operate local transit systems within the regional transit area, or parts of such systems, under agreements between the Board and the municipality within which each local transit system is operated.



(c) To exchange information on operational and design matters and integrate services with other transit systems.



(d) To perform the duties and exercise the powers imposed or conferred on GT Transit under this or any other Act.



The Board's powers for the purpose of supervision are to:



(a) approve, with the modifications it considers appropriate, the annual operating and capital budgets submitted to it by GT Transit;



(b) apportion the costs of GT Transit, including the Board's cost of borrowing for the purposes of GT Transit, among the member municipalities;



(c) borrow money for, and pay such money to, GT Transit in respect of its capital requirements and issue debentures for the debt, subject to the Ontario Municipal Board Act;



(d) direct one or more member municipalities to pay money to GT Transit in respect of its capital requirements;



(e) provide for the design, construction and operation of the regional transit system;



(f) study, or cause to be studied,



(i) the design and operation of the regional transit system,



(ii) the fare structure and service schedules of the regional transit system, and



(iii) the operational integration of the regional transit system with local transit systems within or outside the regional transit area;



(g) approve the approximate location, routes and frequencies of the transit services to be provided;



(h) approve the fares that shall be charged for transit services;



(i) approve the fees that shall be charged for the provision of parking;



(j) enter into agreements with municipalities in the regional transit area with respect to the operation of local transit systems, or parts of such systems, within those municipalities; and



(k) enter into agreements with upper tier and single tier municipalities outside the regional transit area for the provision of transit services by GT Transit to those municipalities;



The power of the Board to apportion among the member municipalities, to issue debentures and to direct any member municipality to pay money to GT Transit in respect of its capital requirements requires a two-thirds vote of those present at a meeting.



For the purpose of carrying out its object, the Board may also:



(a) facilitate the operational integration of the regional transit system and local transit systems in the regional transit area; and



(b) facilitate the resolution of conflicts with respect to transit issues between GT Transit, municipalities and operators of local transit systems.



The Strategic Policies and Priorities Committee also submits the following resolution (March 11, 1998) addressed to The Honourable Mike Harris, Premier of Ontario, from the Regional Clerk of The Regional Municipality of Durham:



Honourable Sir, at their meeting held on March 11, 1998, the Council of the Regional Municipality of Durham passed the following resolution:



"That the following resolution passed by the previous Council (1994-1997) of the Regional Municipality of Durham on July 2, 1997, be reaffirmed by the 1997 - 2000 Council:



(1) That the Honourable Al Leach, Minister of Municipal Affairs and Housing, be advised that:



(i) The Region of Durham does not support the establishment of a Greater Toronto Services Board for the purpose of managing, delivering or generating capital for service infrastructure and, in essence, functioning as a form of government;



(ii) if the Province creates the Board, the Region of Durham recommends it be solely limited to providing long-term strategic planning; co-ordinating inter-regional servicing; providing a forum for discussion with all levels of government; and, resolving inter-regional disputes through facilitation and mediation. Accordingly, the Board's mandate must be directed to deal with inter-regional issues and not be involved with decision-making on the provision of local infrastructure;



(iii) if established, representation on the Executive Committee of the Board should be limited in number and include active involvement of the Province; and all GTA municipalities should be represented on the associated Advisory Committees;



(iv) Any proposed changes to a Greater Toronto Services Board's mandate and related enabling legislation must be subject to public consultation and due process;



(v) if established, the Region of Durham be assigned one additional member on the Executive Committee of the Greater Toronto Services Board; and



(2) that a copy of Joint Report No. 97-J-9 be sent to the Honourable Mike Harris, the Honourable Al Leach, all Durham MPP's, the Area Municipalities in the Region of Durham, the Regions within the Greater Toronto Area, and AMO."



Enclosed, for your information, is a copy of Report No. 97-J-9 as previously sent to you.



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(A copy of the Report No. 97-J-9, referred to in the resolution dated March 11, 1998, from The Regional Municipality of Durham, has been forwarded to all Members of Council with the agenda of the Strategic Policies and Priorities Committee for its meeting on April 7, 1998, and a copy thereof is also on file with the City Clerk.)





15

Municipal Referendum Legislation



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the following report (April 6, 1998) from the City Clerk:



Purpose:



This report gives Council a preliminary overview of the Province's proposed new legislation on municipal referendums and requests Council to urge the Province to extend its 30-day public consultation period.



Recommendations:



It is recommended that:



(1) the Honourable Tony Clement, Minister of Transportation, be requested to extend the 30-day time limit for public consultation on the government's proposed new legislation on municipal referendums; and



(2) the City Clerk, in consultation with the Chief Administrative Officer and the City Solicitor, report further on the proposed legislation to the May 13, 1998, Council meeting through the Strategic Policies and Priorities Committee.



Background:



On March 16, 1998, the Honourable Tony Clement, Minister of Transportation, released a consultation paper on municipal referendum legislation, and announced that for the next month he will tour the Province and consult with citizens about the government's proposal.



The consultation paper sets out a framework for municipal referendums, including:



(1) Procedures for the initiation of binding referendums by both municipal councils and their voters.



(2) Criteria for referendum questions.



(3) Rules to encourage full and accurate disclosure to the voters of the costs of implementing each referendum proposal.



(4) Designation of municipal clerks as having over-all responsibility for administering municipal referendums.



(5) Provisions to allow clerks access to the advice and expertise of the provincial Referendum Commission in making their decisions.



(6) Opportunities for appeals to the Ontario Municipal Board on any decision restricting the initiation or implementation of a referendum.



(7) Rules regarding spending and contribution limits, financial reporting and audit powers in order to equalize the public's access to referendums and to prevent referendums being abused by persons with unlimited financial resources.



(8) Requirements for municipalities to implement the results of binding referendums where at least 50 percent of eligible voters have cast ballots and at least 50 percent of the votes cast are in favour of the result.



(9) Requirements for municipalities to implement the results of a binding referendum only to the extent of the estimated cost which was set out on the ballot.



The proposed referendum legislation has major implications on municipal governance and the role of elected officials. Referendums may be held on their own or at the same time as a municipal election. There is a significant cost to administer each referendum. In addition, a number of issues and questions pertaining to the procedures, criteria and rules need to be addressed. Staff have only recently received the consultation paper and have not had an opportunity to undertake a full review. Council is requested to urge the Province to extend its 30-day consultation period. The Association of Municipalities of Ontario is currently reviewing the proposed legislation and has also requested the Province to extend its time line for consultation.



Conclusion:



This report gives a preliminary overview of the Province's proposed new legislation on municipal referendums. The proposed legislation has significant political, administrative and cost implications. This report recommends that City Council urge the Province to extend its 30-day consultation period to give municipalities sufficient time to respond; and requests the City Clerk, in consultation with the Chief Administrative Officer and the City Solicitor to report further on the proposed legislation to the next meeting of the Strategic Policies and Priorities Committee. A copy of the Consultation Paper entitled "Municipal Referendum Framework" is on file in the office of the City Clerk.



Contact Name:



Denis Kelly, Interim Lead, Elections and Legislative Services, 392-8019.



--------



(Memorandum dated April 3, 1998, addressed to the

Members of the Strategic Policies and Priorities Committee

from Councillor Joan King)



I am chairing a task force at AMO which is reviewing both the draft Municipal Act and the proposed Referendum legislation. Members of the task force have many concerns about municipal referendum and have recommended that the Board of AMO not support the proposed Municipal Referendum Framework. For your information, I am enclosing the material that was before the task force.



I am also including the letter which I sent to Minister Tony Clement.



--------



(Letter dated March 31, 1998, addressed to the

Honourable Tony Clement, Minister of Transportation,

from Councillor Joan King)



As a member of Council in the City of Toronto and as Vice-President of AMO, I am very concerned with the time frame you have given for the public consultation process for the Municipal Referendum Framework Consultation Paper.



The next scheduled meeting of the City of Toronto Council is April 16, 1998. There is insufficient time to prepare a report for Council.



I urge you to reconsider the thirty day deadline for comments concerning the referendum issue with a request that the deadline be extended.



(The material referred to in Councillor Joan King's communication, which was before the task force at AMO, was forwarded to all Members of Council under separate cover on April 8, 1998, and a copy thereof is also on file in the office of the City Clerk).



(City Council on April 16, 1998, had before it, during consideration of the foregoing Clause, a communication (April 15, 1998) from Councillor Joan King, Seneca Heights, advising that the Association of Municipalities of Ontario's (AMO's) Municipal Act Task Force has spent considerable time discussing the draft Municipal Referendum Framework; and submitting a document (April 3, 1998) entitled "Draft Provincial Referendum Act and the Proposed Municipal Referendum Framework", which outlines the Task Force's preliminary comments on the implications of municipal and province-wide referenda.)





16

Solid Waste Management Fees



(City Council on April 16, 1998, struck out and referred this Clause back to the Works and Utilities Committee for further consideration.)



The Strategic Policies and Priorities Committee recommends the adoption of the report (April 6, 1998) from the Interim Functional Lead for Solid Waste Management:



Purpose:



The purpose of this report is to consider all the issues related to adjusting the current Solid Waste Management (SWM) fees at the transfer station and landfill facilities operated by the City of Toronto.



Funding Sources, Financial Implications and Impact Statement:



The City of Toronto currently charges a SWM fee for the disposal of Industrial Commercial Institutional (ICI) private sector waste of $70.00 per tonne at seven transfer stations and $50.00 per tonne at the Keele Valley landfill.



It is estimated that if the City of Toronto implements the recommended fees structure the net annual revenue for the City will increase by approximately $770,000.00.





Recommendations:



It is recommended that:



(1) the solid waste management fee at the Keele Valley landfill be increased to $53.59 per tonne effective November 1, 1998;



(2) the solid waste management fee at all seven City of Toronto transfer stations be reduced to $65.00 per tonne effective May 1, 1998;



(3) the Functional Lead for Solid Waste Management report back to the Works and Utilities Committee by May 1, 1999, on the implementation of the fees structure in recommendation numbers 1 and 2; and



(4) the Functional Lead for Solid Waste Management and the Chief Financial Officer and Treasurer report back to the Budget Committee and the Strategic Policies and Priorities Committee by August 1, 1998, on the funding of 3Rs initiatives through the use of solid waste management fees and the creation of a solid waste management reserve fund.



Council Reference/Background/History:



On March 8, 9, and 10, 1994, the Metropolitan Toronto Council adopted, as amended, Clause No. 1 of Joint Report No. 2 of the Management Committee and The Works Committee establishing SWM fees of $50.00 per tonne at the landfill, and $70.00 per tonne at transfer stations.



On December 18, 1996, Metro Council adopted Clause No. 1 of Report No. 30 of the Financial Priorities Committee authorizing execution of an agreement with Browning Ferris Industries (BFI) for the haulage and disposal of solid waste from the City of Toronto (formerly Metropolitan Toronto).



On February 11, 1998, the Works and Utilities (WU) Committee requested the Interim Functional Lead for SWM to report on increasing the current SWM fee at the Keele Valley Landfill to cover costs.



The WU Committee on March 25, 1998, referred the report entitled, "Solid Waste Management Fees," dated March 20, 1998, from the Interim Functional Lead for Solid Waste Management to the Strategic Policies and Priorities (SPP) Committee for consideration at its meeting on April 7, 1998, for submission to Council for consideration at its meeting on April 16, 1998.



The WU Committee requested the Commissioner of Works and Emergency Services to submit a further report to the Strategic Policies and Priorities Committee on:





(1) the following motions:



(i) that the solid waste management fee at the Keele Valley Landfill site be increased to $53.59 per tonne;



(ii) that the solid waste management fee at the Bermondsey and Scarborough Transfer Stations be reduced from $70.00 to $65.00 per tonne; and



(iii) that such fees become effective immediately, and be implemented initially for a six-month period, with an interim report to be submitted to the Works and Utilities Committee.



(2) the issue of transfer station fees and the means by which the City will enforce measures to prevent illegal dumping;



(3) the status of utilization of transfer station capacities; and



(4) the capacity of the Keele Valley Landfill site.



Discussion:



Extending the Life of the Keele Valley Landfill Site



The City of Toronto has entered into an agreement with BFI for the transport and disposal of a minimum of 250,000 tonnes of waste annually from the City of Toronto to a private landfill in Michigan. The City pays BFI $53.59 per tonne (GST exempt) for this service. The rationale for entering into the BFI contract was to extend the life of the landfill by one year, until the year 2002, in order to allow time for our Environmental Assessment (EA) process to provide long-term disposal solutions for the City.



Transfer Station Utilization:



In a previous report on the capacity and utilization of the transfer station network presented to the former Metro Toronto Environment and Public Space Committee on June 7, 1995, Works Department staff wrote that, "In the future, we project higher utilization of transfer stations for mixed waste..." and, "Increases in the diversion of waste from landfill will represent new challenges for transfer stations, but not a significant decline in utilization." The amount of mixed waste transferred through the transfer stations network in 1997 (941,871 tonnes) was up 10.5 percent over 1995 (842,853 tonnes). In addition, the amount of diversion materials transferred through the network in 1997 (202,723 tonnes) was up 11.5 percent over 1995 (179,505 tonnes). We are projecting that the tonnes of mixed waste and diversion materials managed through our transfer stations will continue to grow in the future. We estimate that we have capacity within our transfer stations to manage the small amount of tonnes projected to be received in any of the six pricing scenarios presented later in this report. The marginal cost for managing any additional mixed waste materials at our transfer stations is approximately $2.00 per tonne (excluding haulage costs) therefore further utilization of our transfer facilities makes good business sense at this time.



Alternative Pricing Structures for SWM Fees:



The City of Toronto currently charges Industrial, Commercial, Institutional (ICI) sources a SWM disposal fee of $50.00 per tonne for waste received at the Keele Valley Landfill and $70.00 per tonne at the seven transfer stations. The estimated allocation of waste tonnes for 1998 based on maintaining the status quo for SWM fees is shown on Table 1. The estimated revenue generated from all SWM fees for waste, wood chips and clean fill that has been included in the 1998 operating budget submission is $35,879,000.00.



The following pricing alternatives have been considered for the SWM fees:



(i) Alternative No. 1 - Increase only the landfill SWM fee for ICI sources to $53.59 per tonne. Rationale: Match the fee the City is paying to BFI.



(ii) Alternative No. 2 - Increase the landfill SWM fee for ICI sources to $53.59 per tonne, plus decrease the SWM fee for ICI sources to $65.00 per tonne at the Bermondsey and Scarborough transfer stations in order to export all additional tonnes of waste received at those transfer stations to Michigan through the use of the BFI agreement.

Rationale: The BFI agreement limits the shipment of City waste to Michigan through the use of only the Scarborough and Bermondsey transfer stations.



(iii) Alternative No. 3 - Increase the landfill SWM fee for ICI sources to $53.59 per tonne, plus decrease the SWM fee for ICI sources to $65.00 per tonne at all 7 transfer stations. All additional tonnes of waste received by the City's facilities would be disposed of at the Keele Valley landfill.

Rationale: Match the fee the City is paying to BFI by adjusting the landfill SWM fee and offset any lost revenue from the increased landfill fee by lowering the SWM fee charged at transfer stations.



(iv) Alternative No. 4 - Increase the landfill SWM fee for ICI sources to $53.59 per tonne plus decrease the SWM fee for ICI sources to $65.00 per tonne at all seven transfer stations. The equivalent of all additional tonnes of waste received by the City's facilities would be disposed of at the BFI landfill by redirecting collection vehicles carrying municipal waste away from the five transfer stations to the Bermondsey and Scarborough transfer stations without impacting collection costs.

Rationale: Do not impact the existing life expectancy of the Keele Valley landfill.



(v) Alternative No. 5 - Decrease the SWM fee for ICI sources to $65.00 per tonne at all 7 transfer stations. All additional tonnes of waste received at all seven of the City's transfer stations would be disposed of at the Keele Valley Landfill.

Rationale: Maximize the net revenue received by the City.



(vi) Alternative No. 6 - Decrease the SWM fee for ICI sources to $65.00 per tonne at all seven transfer stations. The equivalent of all additional tonnes of waste received by the City's facilities would be disposed of at the BFI landfill by redirecting, as required, collection vehicles carrying municipal waste away from the five transfer stations to the Bermondsey and Scarborough transfer stations without impacting collection costs.



Table 1 shows a summary of all the pricing alternatives considered including the financial and operational impacts that arise out of each alternative.



We are recommending the implementation of pricing alternative No. 3 for the SWM fees at landfill and transfer stations for the following reasons:



(1) The landfill SWM fee matches the price the City pays BFI to export its waste to Michigan.



(2) It has virtually no impact on the life expectancy of the Keele Valley landfill site.



(3) It creates minimal traffic impact on the streets surrounding our transfer stations as the additional 75,000 tonnes of waste materials entering our transfer station network will be spread out amongst the seven stations as opposed to going to two stations as is the case in alternative No. 2.



(4) With the exception of alternative No. 5 it results in the largest benefit to the net budget ($769,680.00).



(5) The relatively small (7 percent) increase of the landfill SWM fee will have no impact on illegal dumping within the City of Toronto. This clandestine practise might actually be lessened with the decrease of the SWM fee at our seven transfer stations which are all located within the boundaries of the City of Toronto.



In our opinion alternative No. 3 is the preferred option for generating revenue and maintaining the present level of disposal at the Keele Valley landfill site. However, if the SPP Committee would like to maximize the net annual revenue received by the City, alternative No. 5 could be considered. A negative consequence of choosing alternative No. 5 is that the life expectancy of the Keele Valley landfill is decreased by approximately 1.4 months. Should the SPP Committee wish to maximize the life of the Keele Valley landfill, alternative No. 2 could be considered. A negative consequence to choosing this alternative is that our net budget could be increased by approximately $1,760,000.00 annually since 70,000 tonnes of waste disposal is redirected from the Keele Valley site to the BFI landfill in Michigan.



We believe that our present SWM fees are competitive with the marketplace; consequently, it is difficult to predict with precision what impacts the restructuring of our SWM fees will have on the City's finances and operations, and the waste management marketplace as a whole. As a result, we have been conservative in determining the impact on our net budget. The former Municipality of Metropolitan Toronto made a commitment to the Solid Waste Management Industry Consultation Committee that six months notification of a pricing structure change would be given. Therefore, the increase in the landfill SWM fee should not be implemented until November 1, 1998, whereas the decrease in the transfer station fee could be made effective May 1, 1998 to allow the private sector to take advantage of our reduced fee immediately. During the next 12 months we will converse with the solid waste management industry on the impact the City's SWM fee changes have had on the private sector. We propose to forward a report to the WU Committee by May 1, 1999, providing all the relevant details to allow further consideration of this issue at that time.



We are also recommending that consideration be given to placing any net expenditure/revenue surplus that is generated in the disposal operations sub program in the Solid Waste Management budget for 1998, and in subsequent years, in a waste management reserve fund, with accruing interest, to finance waste diversion programs and lessen the impact of the increasingly higher cost of disposal in the future. Details for the establishment and contribution to the fund would be developed with the Chief Financial Officer and Treasurer and a subsequent report would be sent to the Budget Committee and the SPP Committee by August 1, 1998, for its consideration.



Conclusions:



Increasing the SWM fee from $50.00 per tonne to $53.59 per tonne at the Keele Valley landfill will match the price paid by the City of Toronto to BFI Ltd. to dispose of a minimum 250,000 tonnes of waste annually in Michigan. It is anticipated that this marginal price increase, while increasing the revenue received for each tonne of ICI waste disposed at Keele Valley, will result in a diversion of private ICI paid waste away from the landfill. Decreasing the SWM fee from $70.00 per tonne to $65.00 per tonne at the transfer stations is estimated to attract an additional 75,000 tonnes of ICI waste annually to the transfer stations. The additional tonnage received at the transfer stations will be offset by the reduced ICI tonnage at the Keele Valley landfill site, however, the net financial impact will be an increase in revenue of approximately $770,000.00 annually and virtually no impact on the life expectancy of the Keele Valley landfill.



There should be no impact on illegal dumping within the City of Toronto as a result of the SWM fees restructuring. A waste management waste reserve should be implemented to fund waste diversion programs to lessen the City's dependence on disposal.

Contact Name:



Angelos Bacopoulos, P. Eng., Director - Solid Waste Management Division, Metro Hall, Phone: (416)392-8831, Fax: (416) 392-4754, E-Mail: angelos_bacopoulos@metrodesk.metrotor.on.ca



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Table 1



Estimated Impact of Alternatives



Impact Status Quo

*L/F fee $50.00

**T.S. fee $70.00

Alternative 1

*L/F fee $53.59

**T.S. fee $70.00

Alternative 2

Landfill fee $53.59

Transfer fee $70.00

Except Bermondsey/

Scarborough $65.00

Alternative 3

*L/F fee $53.59

**T.S. fee $65.00

Alternative 4

*L/F fee $53.59

**T.S. fee $65.00

Alternative 5

*L/F fee $50.00

**T.S. fee $65.00

Alternative 6

*L/F fee $50.00

**T.S. fee $65.00

Annual ICI Tonnes

at Transfer Stations

114,000 134,000(1) 189,000(3) 189,000(6) 189,000(6) 189,000(8) 189,000 (8)
Annual Total Tonnes

at Transfer Stations

944,000 964,000 1,019,000 1,019,000 1,019,000 1,019,000 1,019,000
Annual ICI Tonnes disposed

at Keele Valley Landfill

362,000 292,000(2) 292,000(4) 292,000(7) 292,000(7) 337,000(9) 337,000 (9)
Annual Total Tonnes disposed

at Keele Valley Landfill

1,501,000 1,451,000 1,431,000 1,506,000 1,501,000 1,551,000 1,501,000
Annual Total Tonnes disposed

at BFI Landfill (250,000

tonnes minimum)

260,000 260,000 335,000(5) 260,000 265,000 260,000 310,000
Impact on Life of

Keele Valley Landfill

N/A increases life by

approx. 1.4 months

increases life by

approx. 2 months

decreases life by

approx. 4 days

no impact decreases life by

approx. 1.4 months

no impact
Impact on Annual

Expenditures

N/A -117,600 +3,614,850 +1,083,600 +1,252,350 +1,440,000 +3,127,500
Impact on Gross Annual

Revenues

N/A -1,051,720 +2,124,400 +1,853,280 +1,853,280 +3,055,000 +3,055,000
Impact on Net Budget N/A +934,120 +1,490,450 -769,680 -600,930 -1,615,000 +72,500



*L/F = Landfill **T.S. = Transfer Station



(1) compared to status quo 20,000 tonnes come from Keele Valley landfill.

(2) compared to status quo 20,000 tonnes go to City transfer stations and 50,000 tonnes go to private sector facilities.

(3) compared to status quo 50,000 tonnes come from the Keele Valley landfill and 25,000 tonnes come from new ICI customers and go to the Scarborough and Bermondsey transfer stations.

(4) compared to status quo 20,000 tonnes go to private sector facilities and 50,000 tonnes go to the Scarborough and Bermondsey transfer stations.

(5) compared to status quo an additional 75,000 tonnes go from the Scarborough and Bermondsey transfer stations to the BFI landfill.

(6) compared to status quo 50,000 tonnes come from the Keele Valley landfill and 25,000 tonnes come from new ICI customers and are spread evenly throughout the seven City transfer stations.

(7) compared to status quo 20,000 tonnes go to private sector facilities and 50,000 tonnes go to the City's seven transfer stations.

(8) compared to status quo 25,000 tonnes come from Keele Valley and 50,000 tonnes come from new ICI customers.

(9) compared to status quo 25,000 tonnes go to the City's transfer stations.



The Strategic Policies and Priorities Committee also submits the following transmittal letter (March 25, 1998) from the Works and Utilities Committee:



Recommendation:



The Works and Utilities Committee on March 25, 1998, referred the report dated March 20, 1998, from the Interim Functional Lead for Solid Waste Management to the Strategic Policies and Priorities Committee for consideration at its meeting on April 7, 1998, for submission to Council for consideration at its meeting on April 16, 1998.



The Works and Utilities Committee reports, for the information of the Strategic Policies and Priorities Committee, having requested the Commissioner of Works and Emergency Services to submit a further report to the Strategic Policies and Priorities Committee on:







(1) the following motion by Councillor Shiner:



"(I) That the solid waste management fee at the Keele Valley Landfill Site be increased to $53.59 per tonne;



(ii) that the solid waste management fee at the Bermondsey and Scarborough Transfer Stations be reduced from $70.00 to $65.00 per tonne; and

(iii) that such fees become effective immediately, and be implemented initially for a six-month period, with an interim report to be submitted to the Works and Utilities Committee.";



(2) the issue of transfer station fees and the means by which the City will enforce measures to prevent illegal dumping;



(3) the status of utilization of transfer station capacities; and



(4) the capacity of the Keele Valley Landfill Site.



Background:



The Works and Utilities Committee on March 25, 1998, had before it a report (March 20, 1998) from the Interim Functional Lead for Solid Waste Management respecting the solid waste management fees charged at landfill sites and transfer stations; and recommending that:



(a) the solid waste management fee at the Keele Valley Landfill Site be increased to $53.59 per tonne; and



(b) the fee change become effective six months following approval of Council.



Mr. Lenny Campitelli, President, J and F Waste Systems Inc., appeared before the Works and Utilities Committee in connection with the foregoing matter.



--------



(Report dated March 20, 1998, addressed to the

Works and Utilities Committee from the

Interim Functional Lead for Solid Waste Management.)



Purpose:



The purpose of this report is to report on increasing the current Solid Waste Management (SWM) fee at the Keele Valley Landfill Site.



Funding Sources, Financial Implications and Impact Statement:



The City of Toronto currently charges a fee for solid waste disposal of $70.00 per tonne at transfer stations, and $50.00 per tonne at the Keele Valley Landfill Site. In 1998, the expected revenue from SAM fees is $31.3 million. If the City of Toronto marginally increases the fee at Keele Valley by $3.59 to match the Browning Ferris Industries Ltd. (BFI) fee of $53.59 per tonne, the increase in revenue resulting from the fee increase will probably be offset by a loss of revenue in the Industrial/Commercial/Institutional (ICI) customer base at Keele Valley.



It is estimated that this new fee structure will decrease net revenue for the City by $775,000.00.



Recommendations:



It is recommended that:



(a) the solid waste management fee at the Keele Valley Landfill Site be increased to $53.59 per tonne; and



(b) the fee change become effective six months following approval of Council.



Council Reference/Background/History:



On March 8, 9, and 10, 1994, the Metropolitan Council adopted, as amended, Clause No. 1 of Joint Report No. 2 of The Management Committee and The Works Committee establishing SAM fees of $50.00 per tonne at the landfill, and $70.00 per tonne at transfer stations.



On December 18, 1996, Metropolitan Council adopted Clause No. 1 of Report No. 30 of The Financial Priorities Committee authorizing execution of an agreement with BFI for the haulage and disposal of solid waste from the City of Toronto (formerly Metropolitan Toronto).



On February 11, 1998, the Works and Utilities Committee requested the Interim Functional Lead for Solid Waste Management to report on increasing the current SAM fee at the Keele Valley Landfill to cover costs.



Discussion:



The City of Toronto currently charges ICI sources a SAM disposal fee of $50.00 per tonne for waste received at the Keele Valley Landfill and $70.00 per tonne at the seven transfer stations. The estimated allocation of waste tonnes for 1998 based on maintaining the status quo for SAM fees is shown on Sketch No. 1.







Extending Life of Keele Valley Landfill Site:



The City of Toronto has entered into an agreement with BFI for transport and disposal of waste from the City of Toronto to a private landfill in Michigan. The City pays BFI $53.59 per tonne (GST exempt) for this service. The City has entered into this agreement with BFI to reduce the waste tonnage entering the Keele Valley Landfill. This is a short-term solution to increase waste disposal capacity and to extend the life of the Keele Valley Landfill until a long-term disposal arrangement is in place. In 1997, the estimated cost for disposal of waste at the Keele Valley Landfill was approximately $16.00 per tonne, which includes operating costs, capital costs and perpetual care costs.



The rationale for entering into the BFI contract was to extend the life of the landfill by one year to allow time for our Environmental Assessment (EA) process on alternative disposal mechanisms. Therefore any change in fees should not add to the amount of material going to the Keele Valley Landfill.



It is worth noting that two other Regional Municipalities in the Greater Toronto Area with landfill sites discourage the ICI sector from using their facilities by charging high SAM fees. Peel currently charges $80.00 per tonne and Halton charges $133.00 per tonne.



A marginal fee increase at the Keele Valley Landfill to match the BFI fee of $53.59 may cause ICI waste generators to seek out lower priced private sector SAM facilities for the disposal of their waste. This may effectively offset revenues resulting from the fee increase of $3.59 per tonne. However, a diversion of any amount of waste from the Keele Valley Landfill increases the site life and hence allows additional time to select alternative disposal options. Based on this scenario, the estimated allocation of waste tonnes on an annual basis is shown on Sketch No. 2.



Increasing Revenue to the City:



The City receives revenue from the SAM fees it charges the ICI sector at its facilities. Since there are private sector alternatives, raising our rates may decrease the volume of ICI tonnage received and hence our revenue will decrease.



We estimate that reducing the SAM fees at the transfer stations will attract additional tonnage, and will compensate for the reduced revenue as a result of increasing the landfill SAM fee, thereby allowing for an overall increase in SAM fee revenue. This would result in an increase in tonnage going to the Keele Valley Landfill via the transfer stations.



The additional tonnage could be diverted from Keele Valley to Michigan through the use of the BFI contract, however, this will require considerable system adjustment since BFI only hauls from two of the seven transfer stations.



The best option for generating revenue and maintaining the present level of disposal at the Keele Valley Landfill is to combine an increase in the fee at the Keele Valley Landfill with a reduction in the fee at the transfer stations.



It is estimated that lowering the SAM fee at the transfer stations to $65.00 per tonne will attract 50,000 tonnes of ICI waste originally destined for Keele Valley and an additional 25,000 tonnes of new ICI waste. The increased ICI waste at the transfer stations will approximately offset the reduced tonnage expected at Keele Valley due to the SAM fee increase at the landfill. Under this scenario the additional 5,000 tonnes received at our facilities will be shipped to Michigan through the BFI contract. It is estimated that net revenue will increase by approximately $1.2 million on an annual basis. Based on this scenario the estimated allocation of waste tonnes on an annual basis is shown on Sketch No. 3.



In order to change our pricing structure, the former Municipality of Metropolitan Toronto made a commitment to the Solid Waste Management Industry Consultation Committee (SWMICC) that six months notification of a pricing structure change would be given. In view of this commitment, it is recommended that the fee increase to $53.59 be made effective six months following authorization by Council.



Conclusions:



Increasing the SAM fee from $50.00 per tonne to $53.59 per tonne at the Keele Valley Landfill will match the price paid by the City of Toronto to BFI to dispose of 250,000 tonnes of waste annually to Michigan. It is anticipated that this marginal price increase, while increasing the revenue received for each tonne of ICI waste disposed at Keele Valley, will result in a diversion of private ICI paid waste and will reduce net revenue to the City by an estimated $775,000.00.



Decreasing the SAM fee from $70.00 per tonne to $65.00 per tonne at the transfer stations is estimated to attract an additional 75,000 tonnes of ICI waste to the transfer stations. The additional tonnage received at the transfer stations will be offset by the reduced ICI tonnage at the Keele Valley Landfill Site and an additional shipment of 5,000 tonnes to Michigan through the BFI contract. Therefore there will be no effect on the remaining life of the landfill.



It is estimated that by increasing the SAM fee at Keele Valley to $53.59 per tonne and lowering the SAM fees at the transfer stations to $65.00 per tonne will increase net revenue by approximately $1.2 million for the City.



Given that the rationale for entering into the BFI contract was to extend the life of the Keele Valley Landfill Site by one more year, we are reluctant to recommend any option that increases the annual tonnage to the landfill.



Contact Name:



Angelos Bacopoulos, Director - Solid Waste Management, Metro Hall, Phone: (416) 392-8831, Fax: (416)392-4754, E-Mail: angelos_bacopoulos@metrodesk.metrotor.on.ca .



Insert Table/Map No. 1

sketches 1, 2, 3 - solid waste management division



Insert Table/Map No. 2

sketches 1, 2, 3 - solid waste management division



Insert Table/Map No. 3

sketches 1, 2, 3 - solid waste management division



(Communication dated March 2, 1998, addressed to

the Commissioner of Works and Emergency Services,

from Councillor Bossons)



I am advised, not for the first time, that fees at private transfer stations have risen. However, the fees at City of Toronto transfer stations and the Keele Valley Landfill Site have not risen in recent memory.



This should be of concern for two reasons: The City's landfill will grow full faster than preferable; the City is missing out on revenues.



I would ask that staff responsible for landfill report on the rates currently charged elsewhere and make recommendations for adjustments of the City's fees. I acknowledge that, at Metro, there was an agreement with the waste hauling industry that Metro would not hike its deposit fees at short notice.



--------



The Strategic Policies and Priorities Committee also had before it a communication dated April 6, 1998, from Mr. Arthur Potts, Municipal Affairs Consulting, which has been circulated to all Members of Council under separate cover on April 8, 1998, and a copy thereof is also on file in the office of the City Clerk.





17

A New Official Plan for the City of Toronto



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the recommendation of the Urban Environment and Development Committee embodied in the following transmittal letter (March 27, 1998) from the Urban Environment and Development Committee:



Recommendations:



The Urban Environment and Development Committee on March 23 and 24, 1998, recommended to the Strategic Policies and Priorities Committee:



(1) the adoption of Recommendation No. (1), embodied in the attached report (March 11, 1998) from the Commissioner of Planning and Urban Development Services, subject to striking therefrom all the words following the words "City of Toronto"; so that such Recommendation shall read as follows:



"(1) It is recommended that Council seize this opportunity to develop its new Official Plan for the City of Toronto.";



(2) that, should the estimated funding of $250,000.00 not be provided as part of the 1998 Transition Costs, the Commissioner of Planning and Urban Development Services be requested to submit a report to the Urban Environment and Development Committee demonstrating how these funds will be accommodated within the budget process;



(3) that, in addition to "capital works, height, form and density of buildings, use of land and provision of transportation services", the new Official Plan for the City of Toronto should include social and environmental goals and criteria to create a comprehensive framework for planning;



(4) that the following Council-appointed Task Forces and Committee be requested to forward to the Urban Environment and Development Committee their recommendations regarding the proposed new Official Plan and the Official Plan work plan:



- Access and Equity Action Plan, Race Relations, Disability and Human Rights, and Ethno-Canadian Issues Task Force:

- Homeless Strategy Task Force;

- Task Force to Develop a Strategy for Issues of Concern to the Elderly;

- Environment Task Force;

- Children's Action Committee; and

- Task Force on Community Safety;



(5) that the consultation process be modified:



(a) to reflect the need to address social and environmental issues in the new Official Plan;



(b) and expanded to allow sufficient access to the public; and



(c) to give the Council-appointed Task Forces and Committee, referred to in Recommendation No. (4), above a formal role in the consultation process to focus the public input on critical social and environmental issues;



(6) that the "ambitious" one-year work plan and schedule be extended to a two-year timeframe in order to allow for more thorough analysis and public consultation;



(7) that a Task Force, comprised of Members of Council, be established to oversee Phase One of the new Official Plan development and the consultation process; and



(8) that this matter be forwarded to Council for consideration at its meeting scheduled to be held on April 16, 1998.



The Urban Environment and Development Committee reports, for the information of the Strategic Policies and Priorities Committee, and Council, having requested the Commissioner of Planning and Urban Development Services to submit a report directly to Council on April 16, 1998, should there be any further considerations with respect to the new Official Plan for the City of Toronto.



--------



(Report dated March 11, 1998, addressed to the

Urban Environment and Development Committee from the

Commissioner of Urban Planning and Development Services.)



Purpose:



To present a proposal for producing a new Official Plan for approval.



Funding Sources, Financial Implications and Impact Statement:



Funds of $250,000.00 have been requested by the Department as part of the 1998 Transition Costs.



Recommendations:



It is recommended that:



(1) Council seize this opportunity to develop its new Official Plan for the City of Toronto and adopt the work plan and schedule outlined in this report; and



(2) the Urban Environment and Development Committee endorse this report and refer it to the Strategic Policies and Priorities Committee for consideration.



Council Reference/Background/History:



In its report, entitled "New City, New Opportunities", the Toronto Transition Team recommended that "An early priority of the Urban Environment and Development Standing Committee should be the preparation of a new Official Plan for the City for adoption during the first term of Council."



The Toronto Area Planning Commissioners, in their brief to the Transition Team, recommended that the new Council adopt a new Official Plan within its first term of office.



Why Do We Need a New Plan?



A new Council in a new City needs its own vision and blueprint for the future. This is an opportunity to begin a new city with a new and clear direction to guide city development and to set Council's priorities.



The initial benefit is for Members of Council, the community and staff to become involved together in a city-building process that will help to develop a common purpose and identity. The experience of defining a new City collectively is almost as important as the resulting product itself.



The new Official Plan will permit Council to provide consistent direction to the corporation. It will focus on goals and the policies and the means required to achieve them. It will identify features of the City which are to be enhanced, problems which need to be overcome, and the opportunities which are available.



The Toronto urban region is the pre-eminent economic engine in Canada. We compete with Boston, Montreal, Chicago, Atlanta, Barcelona, Munich and other world cities. Now Members of Council and the administration can work together to produce innovative ideas which will improve our ability to deal with problems and opportunities.



The seven existing Official Plans were adopted in a different political situation and the assumptions and policies of these plans would need to be reviewed in any case in light of the changes brought about by amalgamation. This provides the opportunity for the new City Council to provide clear and consistent policy directions. Matters of City-wide importance need to be distinguished from those of more local or community concern. A clear policy initiative needs to be determined to deal with Greater Toronto Area issues.



The New Official Plan:



The new Official Plan must identify and build on the City's strengths. It must seize the opportunities provided by a new single City administration. It must focus on the physical structure, built form, design and beauty of the City. The Plan can be a vehicle to incite civic interest and passion and to create pride in the manner in which the city develops.



The new Official Plan must be policy-driven. Policies should be meaningful and deal with the real choices and decisions that Council must make. The new policies should be relevant; they should deal with matters within the scope and power of City Council. They must be useable and facilitate Council's decision-making regarding infrastructure improvements: capital works, height, form and density of buildings, use of land and provision of transportation services.



The new Official Plan will provide the context for dealing with development applications and local plans. It will help to guide capital budget spending in accordance with the preferred vision for the new City.



The new Official Plan will complement work being undertaken by the City in a variety of disciplines. It will be guided by policy directions emanating from the Social Development Strategy and the Environmental Task Force while at the same time providing input to these projects. Collectively, these different initiatives will provide a comprehensive set of policies to guide the decisions of Council and to direct the activities of the City departments.



The Planning Process:



Existing local Official Plans are essentially composed of three parts. The first part includes policies of what the Council wishes to achieve or to avoid. The second part contains land use regulations which are cross-referenced to a multi-coloured land use map. The third part consists of a number of site specific amendments. The proposal in this report is to deal at this time only with the first part of the local Plans and with all of Metroplan.



The new Official Plan Policies will be produced in two steps.



In step one, the overall planning framework will be produced in 1998. It will deal with the structure of the City. Areas of change, stability, and redevelopment will be identified. Priorities will be determined.



Once a new set of Objectives and Policies has been adopted by Council, the second step, undertaken in early 1999, will be to incorporate those policies into the Official Plan and to repeal Metroplan and the redundant policies in the six local Official Plans.



Land use regulations and designations in the six existing local Official Plans will be reviewed later in 1999, after approval of the overall policy framework. At that time, these designations will be simplified, integrated into a common format, and made consistent with the overall planning policies.

Work Plan and Schedule:



The schedule proposed is very ambitious and is based on providing Council with the ability to adopt new policies and to set priorities by the end of this year. The actual Official Plan amendments would be passed early in 1999. Overall, the schedule responds to the challenge of producing a new Official Plan within one year.



(a) Phase 1: Background Research:



The first phase of the work, to be completed between June and August of this year, is to collect and analyze plans, information and studies already undertaken and to update these with the latest statistics available.



Review, analyze and summarize existing Official Plan policies and other Toronto planning studies, particularly those carried out for Metroplan and CityPlan'91. We need to know who we are as a city, how we got here and where we are going, i.e., the historical dynamic.



Undertake research to document, analyze and present trends affecting Toronto, particularly spatial changes within the Greater Toronto Area. This step will include employment changes, retail trends, demographic changes, redevelopment pressures and socio-economic and ethnic patterns.



Review planning documents and processes in other comparable cities. We need to know the issues, actions, programs and success stories from other jurisdictions.



Identify Toronto's strengths, weaknesses, and opportunities and create a preliminary list of built form and land use issues.









(b) Phase 2: Consultation and Input:



The second phase of the work, to be completed by September 1998, is to gain input from the public and to consult with Members of Council and senior staff to obtain a consensus on the directions for the new Plan.



Design the public input process, which may include topic-specific groups to ensure the constructive involvement of a broad range of audiences, and begin public input as soon as Council approves the work plan. The media needs to be involved, as should various organizations and institutions.



Convene a meeting in late June or early July 1998 on the theme: "What is this thing called 'Toronto' and where is it going?" This will be an off-site, all-day meeting of interested Members of Council, senior staff, retained consultants and senior provincial officials. We will review where we are and where we are going, and determine issues, goals and values. We will also identify possible policies and directions for further work.



After the June (or July) meeting, we will consolidate the results of the meeting, the input from the public, and the review of other cities' successes and approaches. There will be a preliminary determination of the desirable city structure and the relationship between land uses and infrastructure requirements. This will include a review of the need for land for future employment purposes and possible strategies for dealing with vacant, obsolete industrial areas.



(c) Phase 3: Preparation of a Planning Framework:



The third phase is to produce the Planning Framework for the Official Plan for adoption by Council before the end of 1998.



The theme of a September, 1998 meeting will be "A draft framework for Toronto's planning policies". This will be an off-site, all-day meeting of those present at the June 1998 meeting plus, where appropriate, representatives of other cities or agencies to present alternate solutions. There will be a review of the draft policies and the planning framework and a discussion regarding the production of the public document.



A report, entitled "A Planning Framework for Toronto's Official Plan", will be sent to the Urban Environment and Development Committee on November 2, 1998, for public comment.



A revised and final report will be sent to the Urban Environment and Development Committee on November 30, 1998, and to Council in December, 1998 for approval as Council's Policies related to the built form of the City.









(d) Phase 4: From a Planning Framework to an Official Plan--1999:



The final phase of producing a policy-driven Official Plan will be to undertake the public hearing process required by the Planning Act and to incorporate Council's policy directions as part of the City of Toronto's Official Plan.



Prepare specific amendments necessary to repeal Metroplan and to remove contrary and redundant policies from existing Official Plans. This will be undertaken in conjunction with the adoption of the new planning framework.



Public presentations of the proposed Official Plan policies will be made to Community Councils and public interest groups.



Notice will be given of the statutory public meeting to incorporate the Planning Framework as the City's Overall Planning Policies in the Official Plan. Public hearings will be held in April or May 1999 by the Urban Environment and Development Committee prior to consideration of the Official Plan by City Council.



Insert Table/Map No. 1

new official plan - preliminary public consultation work program



Staffing Expenses:



The proposed work plan can be carried out with existing staff resources. A number of work plan items, previously approved by the pre-amalgamation Councils, can be incorporated into this Official Plan Review. Other items can be deferred until after the new Official Plan is approved.



Expenses associated with this work plan relate to such matters as undertaking outside studies, inviting external experts and representatives of other North American cities to Toronto, advertising and running a number of information sessions, and preparing and printing proposals and final reports.



Conclusions:



A common planning framework for making decisions concerning the built form of the City can and should be undertaken in 1998. Once completed as Council's vision for the future, the planning framework can be incorporated into the Official Plan early in 1999. Conflicting and redundant policies in the six local Official Plans and all of Metroplan can then be repealed at that time.



Contact Name:



Mr. Kenneth Whitwell, York Civic Services Office, 394-2610; fax: 394-2782.





18

Request for Change of Quorum -

Municipal Grants Review Committee



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the recommendation of the Municipal Grants Review Committee embodied in the transmittal letter (March 31, 1998) from the Municipal Grants Review Committee:



Recommendation:



The Municipal Grants Review Committee on March 31, 1998, during discussion of its mandate, recommended to the Strategic Policies and Priorities Committee, and Council, that its quorum be reduced from five members to four members, in the interest of pursuing the work of the Committee, and having regard to the concerns expressed by members with respect to the conflicting number of meetings that they are expected to attend.



19

Increase in Property Tax Reassessment



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 19 of Report No. 4A of The Strategic Policies and Priorities Committee.)





20

Contract No. T-23-98: City of Toronto Roads at Four Locations



(City Council on April 16, 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 (April 1, 1998) from the Budget Committee:



Recommendation:



The Budget Committee on March 31, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the recommendations of the Urban Environment and Development Committee, wherein it is recommended that the report (March 2, 1998) from the Interim Functional Lead, Transportation, be adopted.



Background:



The Budget Committee on March 31, 1998, had before it a letter of transmittal (March 24, 1998) from the Urban Environment and Development Committee advising that the Committee on March 23 and 24, 1998 recommended the adoption of the report (March 2, 1998) from the Interim Functional Lead, Transportation, regarding Contract No. T-23-98 for the resurfacing of roads at four locations in the City of Toronto.



--------





(Transmittal letter dated March 24, 1998 addressed to the

Budget Committee from the

Urban Environment and Development Committee)



Recommendations:



The Urban Environment and Development Committee on March 23 and 24, 1998, recommended to the Budget Committee, the Strategic Policies and Priorities Committee, and Council:



(1) the adoption of the report dated March 2, 1998, from the Interim Functional Lead, Transportation, regarding Contract No. T-23-98 for the resurfacing of City of Toronto roads at four locations; and



(2) that this matter be forwarded to Council for consideration at its meeting scheduled to be held on April 16, 1998.



The Urban Environment and Development Committee reports having referred the joint communication (March 20, 1998) from Mrs. Helen Hansen and Mrs. Joan Doiron, Toronto Pedestrian Issues Sub-Committee, and the newspaper articles filed by Mrs. Hansen, to the Pedestrian Issues Sub-Committee of the Metropolitan Cycling and Pedestrian Committee for consideration.



Background:



The Urban Environment and Development Committee had before it a report (March 2, 1998) from the Interim Functional Lead, Transportation, recommending that:



(1) Contract No. T-23-98, for the resurfacing of City of Toronto roads at four locations, be awarded to D. Crupi and Sons Limited who submitted the lowest price bid in the amount of $2,892,366.33;



(2) the appropriate City of Toronto officials be directed to take necessary action to give effect thereto; and



(3) in the event that the 1998-2002 Capital Works Program is not approved by Council at its April 15, 1998 meeting, pre-budget and project financing approval in the amount of $3,227,366.33 be granted for this project in order that the project may commence in late April, 1998.



The Committee also had before it a joint communication (March 20, 1998) from Mrs. Helen Hansen and Mrs. Joan Doiron, Toronto Pedestrian Issues Sub-Committee, urging, with respect to items of resurfacing of roads, new traffic control signals and other road changes, that full consideration be given to the safety of pedestrians and other non-motorized road users.



Mrs. Helen Hansen, Toronto Pedestrian Issues Sub-Committee, appeared before the Urban Environment and Development Committee in connection with the foregoing matter.



--------



(Report dated March 2, 1998 addressed to the

Urban Environment and Development Committee from the

Interim Functional Lead, Transportation)



Purpose:



To award a contract for the resurfacing of Toronto roads at four locations.



Funding Source:



The Department's proposed 1998-2002 Capital Works Program includes an amount of $6,523,000.00 under Project No. C-TR496, Road Resurfacing. Contract No. T-23-98 forms part of that program, and the estimated total project cost, including other costs, is $3,227,366.33, which consists of:



(1) Bid Price Amount $2,892,366.33



(2) Other Costs (estimate): 335,000.00

(a) quality control testing

(b) traffic signage and pavement markings

(c) bicycle proof catch basin frames and covers

____________



Total Project Cost $3,227,366.33



The Capital Budget for the City of Toronto, which includes this project, is scheduled to be approved by Council at its meeting on April 15, 1998. Funding will be available in Capital Account No. C-TR496, Road Resurfacing, with concurrent approval of the 1998 Capital Budget and project financing by City Council.



The Treasurer has previously certified that financing can be provided under the updated Debt and Financial Obligation Limit and that it falls within Corporate Debt Guidelines.



Recommendations:



It is recommended that:



(1) Contract No. T-23-98, for the resurfacing of City of Toronto roads at four locations, be awarded to D. Crupi and Sons Limited who submitted the lowest price bid in the amount of $2,892,366.33;



(2) the appropriate City of Toronto officials be directed to take necessary action to give effect thereto; and



(3) in the event that the 1998-2002 Capital Works Program is not approved by Council at its April 15, 1998 meeting, pre-budget and project financing approval in the amount of $3,227,366.33 be granted for this project in order that this project may commence in late April, 1998.



Comments:



On February 26, 1998, the City Clerk's Department opened tenders for:



Contract No.T-23-98 Resurfacing of City of Toronto Roads at Four Locations

Number Name $ Amount



2 D. Crupi and Sons Limited $2,892,366.33

5 Gazzola Paving Limited 2,915,395.30

4 Pave-Al Limited and Orlando Corporation 2,961,253.19

7 Warren Bitulithic Limited 2,987,584,39

1 Fermar Paving Limited, Fermar Asphalt Ltd., 3,003,165.93

Fermar Crushing and Recycling Ltd.

6 Sentinel Paving and Construction Ltd. 3,294,279.30

3 Brennan Paving and Construction Ltd. 3,342,724.87

8 Graham Bros. Construction Ltd. 3,377,623.96



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 Treasurer regarding the surety company which issued the Bid Bond and Agreement to Bond.



Scope of Work:



This contract includes crack repairs, scarifying, grinding, concrete repairs, catch basins, and asphalt overlay on the following roads:



(1) Eglinton Avenue--Black Creek Drive to Weston Road;



(2) O'Connor Drive--Woodbine Avenue to Sandra Road;



(3) Rexdale Boulevard--460 metres west of Highway No. 27 to 320 metres west of Humberwood Boulevard; and



(4) W. R. Allen Road--Sheppard Avenue to Overbrook Place.



Conclusion:



Contract No. T-23-98 should be awarded to D. Crupi and Sons Limited who submitted the lowest price bid for this Contract.



Contact Name and Telephone Number:



Mr. R. Burlie, P. Eng., Manager of Resurfacing, Construction Branch, Metro Hall Office, 392-8322.





21

Replacement of Lighting on the F.G. Gardiner Expressway

from the Humber River to the Don Valley Parkway



(City Council on April 16, 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 (April 1, 1998) from the Budget Committee:



Recommendations:



The Budget Committee on March 31, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the recommendations of the Urban Environment and Development Committee, wherein it is recommended that the report (February 23, 1998) from the Interim Functional Lead, Transportation, be adopted.



Background:



The Budget Committee on March 31, 1998, had before it a letter of transmittal (March 24, 1998) from the Urban Environment and Development Committee advising that the Committee on March 23 and 24, 1998 recommended the adoption of the report (February 23, 1998) from the Interim Functional Lead, Transportation, regarding the replacement of lighting on the F.G. Gardiner Expressway, from the Humber River to the Don Valley Parkway.



--------



(Letter of Transmittal dated March 24, 1998 addressed to the

Budget Committee from

Urban Environment and Development Committee)



Recommendations:



The Urban Environment and Development Committee on March 23 and 24, 1998, recommended to the Budget Committee, the Strategic Policies and Priorities Committee, and Council:



(1) the adoption of the attached report dated February 23, 1998, from the Interim Functional Lead, Transportation, regarding the replacement of lighting on the F. G. Gardiner Expressway, from the Humber River to the Don Valley Parkway; and



(2) that this matter be forwarded to Council for consideration at its meeting scheduled to be held on April 16, 1998.



--------



(Report dated February 23, 1998, addressed to the Budget Committee

from the Interim Functional Lead, Transportation)



Purpose:



To obtain Council authority to carry out the staged replacement of the existing lighting systems on the F. G. Gardiner Expressway, from the Humber Bridges to the Don Valley Parkway (DVP).



Funding Sources:



The Department's proposed 1998-2002 Capital Works Program includes an amount of $65.82 million under Project No. C-TR180, F. G. Gardiner Expressway, Parkway to Humber. The replacement of the Gardiner Expressway lighting forms part of that program and the estimated total project cost is $9.0 million, of which $2.5 million is anticipated to be spent in 1998. Funding is currently available in Capital Account No. C-TR180, and the Treasurer has previously certified that financing can be provided under the updated Debt and Financial Obligation Limit and that it falls within Corporate Debt Guidelines.



Recommendation:



It is recommended that, subject to the approval of the 1998-2002 Capital Works Program, authority be granted to undertake the replacement of the lighting systems on the F. G. Gardiner Expressway, from the Humber Bridges to the Don Valley Parkway, at an estimated cost of $9.0 million.



Background:



The F. G. Gardiner Expressway (FGGE) is the last Expressway link in the original Metropolitan Toronto Roads System which has not undergone a replacement of its lighting systems. Many elements of the existing lighting systems on the FGGE date from the original installations carried out in the 1960s. They, therefore, predate the lighting systems on the Don Valley Parkway (DVP) and the Allen Road, both of which have already been replaced or are in the process of being replaced. For reasons identified in this report, it is now necessary to replace the FGGE lighting systems.



The lighting systems on the FGGE service two different physical configurations. These are the "at-grade" section from the Humber River to east of Dufferin Street and the elevated, structural section from east of Dufferin Street to the proposed new termination of the Expressway approximately 200 metres east of the DVP.



In the at-grade section of the Expressway, the existing (original) system comprises conventional lighting poles located within the raised, curbed median of the Expressway between steel beam guide rails mounted on timber posts. These poles carry extended support arms and luminaries which illuminate the two directions of travel. The system in this section requires replacement for two reasons. The first is because of widespread deterioration of the underground wiring circuits. The second is the need to reconfigure the Expressway median to current highway geometric and safety standards concurrently with the resurfacing of this section of the Expressway, which is scheduled for 1999. The existing raised median configuration, with curbs and steel beam guide rails, will be replaced by New Jersey type concrete traffic safety barriers which will match the median type on the elevated portion of the Expressway. This redesign of the median will require the relocation of light poles from the median to new locations outside of the Expressway pavement. The new lighting system must be constructed and in operation prior to removal of the old lighting system.



The existing wiring feeding the at-grade section is in very poor condition. Most of the approximately 250 fixtures are still fed by the original direct buried wiring, which is rapidly deteriorating. In recent years, the maintenance contractor has been required to repair approximately 14 faults annually related to underground circuit burndowns. Because these faults can be repaired only during Expressway closures for other purposes, there have sometimes been extended periods during which some lights were not working. These repairs have become more frequent and would soon oblige us to replace the entire power feed circuits, even without the scheduled roadway resurfacing and median reconfiguration.



On the elevated section of the FGGE, east of Dufferin Street, most of the existing fixtures are still equipped with the original luminaries and replacement parts are no longer available. As a result, the entire lighting fixture must be replaced whenever there is a failure at a cost of $400.00 plus installation costs, lane closure costs and public inconvenience. In 1996 and 1997 there were approximately 100 failures of this type.



Considered separately, the existing power circuit feeds in the elevated section of the Expressway are relatively new and are not causing undue maintenance difficulties. Nevertheless, there are serious problems with the lighting systems in this section as follows:



(1) the old poles are in various stages of deterioration due to their age;



(2) the system is still fed by Toronto Hydro under the old, inefficient 120-volt distribution network;



(3) the system does not have the benefit of the available technology, hardware and shielded luminaries used in modern, effective and safe highway lighting systems; and



(4) the problems of failing and obsolete original luminaries in this section cannot be satisfactorily resolved by simply continuing to replace them with newer type heads, either one by one as they fail, or in one concentrated operation during a scheduled maintenance closure of the Expressway. The replacement lighting heads we have had to use to fit the old fixtures are different from the modern luminaire type that we are using elsewhere on our expressways and intend to use on the at-grade section of the FGGE. They do not incorporate the effective shielding features that prevent excess light spillage. They could not be transferred and refitted to the new type of pole we are bringing into service without added difficulty and extra cost of fabricating non-standard or custom hardware and fittings. This would also result in an inconsistent, ill-matched appearance and complicate future maintenance.



Discussion:



In 1996, the former Metro Transportation Department issued a Request for Proposals from consultants to conduct an Environmental Assessment Study for Replacement of the Gardiner Expressway Lighting. Six proposals were received and competitively evaluated. As a result, the firm of Fenco MacLaren Inc., Consulting Engineers, was engaged to carry out the assignment.



The F. G. Gardiner Expressway Lighting Replacement Environmental Assessment Study, as a safety-related improvement, was carried out in accordance with the requirements of Schedule "B" of The Class Environmental Assessment for Municipal Road Projects (the Class EA). The Class EA describes a planning and public consultation process, which was approved by the Ministry of the Environment and Energy (MOEE) in June 1993. In due course, the Environmental Study Report is filed on the public record for 30 days according to the requirements of the Class EA. During this period, affected municipalities, members of the public, interest groups or government agencies may request that the status of the project be changed or "bumped-up" from a Class EA to an Individual Environmental Assessment. The Minister of the Environment and Energy determines whether or not to grant a bump-up request. If the bump-up is granted, the project may not proceed until an Individual Environmental Assessment is prepared by the proponent and approved by the Minister. If the bump-up is not granted, or if no objections or bump-up requests are received during the 30-day filing period, the project is automatically approved under the Environmental Assessment Act and may proceed.



The F. G. Gardiner Expressway Lighting Replacement EA Final Report was completed in early summer 1997, and, on July 19, 1997, was placed on the public record for the required 30-day review period. During this period, the Minister of the Environment and Energy received one request for a bump-up and this request was denied. As a result, this project may now proceed subject to Council approval.



The Study recommends that the new system for the at-grade section of the Expressway (except where insufficient space is available within the property corridor, as noted below), should consist of high mast poles with shielded luminaries, similar to the system in place on sections of the Don Valley Parkway. In this system, one high mast pole can replace from eight to ten conventional poles. The shielding of the luminaries effectively prevents spillage of lighting beyond limits that can be precisely adjusted and controlled. The high mast poles will be off the roadway in open space just to the south of the Expressway and will be able to light the entire Expressway from the south side. This location will also greatly simplify both the new construction and future maintenance of the high mast poles since both will be able to occur without interfering with traffic flows. In two stretches of the at-grade section, there is insufficient space within the corridor for high mast poles. These are from west of Ellis Avenue to the Humber Bridges and for approximately 350 metres west from the Jameson Avenue/Dunn Avenue Interchange. In these two areas, conventional poles will be installed on both sides of the roadway.



It is intended to proceed with Phase 1 of this project in 1998, which includes:



(a) twenty conventional poles from Windermere Avenue to Ellis Avenue;



(b) fifteen high mast poles from Ellis Avenue to approximately 350 metres west of Dowling Avenue;



(c) a group of 36 conventional poles located on both sides of the roadway from 350 metres west of Dowling Avenue to the west side of the interchange at Jameson Avenue/Dunn Avenue; and



(d) five more high mast poles at the interchange at Jameson Avenue/Dunn Avenue which will replace nearly 50 conventional poles on the FGGE and its interchange ramps at that location.



The substantial reduction in the number of poles achieved by using high mast poles will greatly reduce visual clutter and lighting maintenance operations on the Expressway around the Humber Bay. The 20 high mast poles proposed will do the work of almost 200 conventional poles that would otherwise be needed. In addition, landscaping measures have been identified to introduce plant materials around the installations to reduce their visual impact on other space users at ground level.



The design for the stretch west of Windermere Avenue to the Humber Bridges will be included in contracts of the Humber Bridges Project scheduled for implementation in 1998 and 1999.



On the elevated section of the FGGE, from east of Dufferin Street to the future termination of the Expressway east of the DVP, it is not possible to use high mast poles due to both insufficient corridor property and physical/structural constraints. Instead, the new lighting system in the elevated section will use new conventional poles mounted on the elevated structure in a similar way to the original system. The new poles and shielded heads will match those being used elsewhere on the Expressway network. Contracts for this work will be tendered in 1999 to 2000.



Conclusions:



The lighting systems on the F. G. Gardiner Expressway must be replaced, principally as a result of general deterioration and obsolescence.



The proposed upgrades to the lighting system on the FGGE are intended to achieve the same objectives pursued in similar work carried out earlier on the Don Valley Parkway and the Allen Road. These are:



(1) replacement of obsolete and deteriorated installations requiring excessive repairs and maintenance;



(2) standardization of lighting systems and hardware throughout the Expressway network for ease and economy of operation and maintenance, and assured availability and interchangeability of parts;



(3) standardization of power supply, throughout the amalgamated municipal hydro system, at a 347-600 volt, three-phase distribution network for economical, efficient, uniform and reliable service;



(4) standardization of lighting type to high-pressure sodium (HPS) lamps for effective, economical illumination and proven performance;



(5) incorporation of state-of-the-art technology in providing effective, safe, and economical illumination of the Expressways with effective shielding to prevent light spillage into adjacent areas;



(6) the ability to carry out installation and maintenance of high mast poles without disrupting traffic; and



(7) reduced visual clutter along the Expressway and reduction of visual impacts of the installations at ground level by the use of strategically-placed plantings.



The study and preferred scheme should be approved and the construction of the project should be authorized.



Contact Name:



Mr. Barry I. Craig, P. Eng., Manager of Roads, Construction Branch, Metro Hall Office, 392-8312.





22

St. Lawrence Centre for the Arts - Request to Withdraw Funds

from the Capital Improvement Fund



(City Council on April 16, 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 (April 1, 1998) from the Budget Committee:



Recommendation:



The Budget Committee on March 31, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, that the request from the St. Lawrence Centre for the Arts to withdraw funds in the amount of $52,000.00 from the Centre's Capital Improvement Fund be approved.





Background:



The Budget Committee on March 31, 1998, had before it a communication (March 12, 1998) from Mr. David G. Wallett, General Manager, St. Lawrence Centre for the Arts requesting the withdrawal of funds in the amount of $52,000.00 from the Centre's own Capital Improvement Fund.



Mr. David G. Wallett, General Manager, St. Lawrence Centre for the Arts, appeared before the Budget Committee in connection with the foregoing matter.



--------



(Communication dated March 12, 1998, addressed to the

Budget Committee from the

General Manager, St. Lawrence Centre for the Arts)



Prior to 1995, the St. Lawrence Centre's operating budget carried a line item for Property and Technical Improvements. For fiscal 1995, and succeeding years, the Budget Review Committee ruled that purchases and expenses that had come under that line item should more properly be drawn from the Centre's own Capital Improvement Fund. Accordingly, we would like to request that the St. Lawrence Centre for the Arts be allowed to withdraw up to Fifty-Two thousand Dollars ($52,000) from the Capital Improvement Fund in fiscal 1998 for items in this category.



The use of these funds will be for the following express purposes:



(1) an amount of up to $7,300.00 to replace the programme sound system in the Jane Mallett Theatre;

(2) an amount of up to $1,000.00 to renovate the Jane Mallett Theatre control booth;

(3) an amount of up to $6,500.00 to replace Stage Lighting fixtures in the Jane Mallett Theatre;

(4) an amount of up to $2,000.00 to replace the Closed Circuit T.V. monitoring system;

(5) an amount of up to $2,500.00 to acquire a remote control for Bluma Appel Theatre lighting;

(6) an amount of up to $3,600.00 to replace one pair of black velour stage curtains;

(7) an amount of up to $2,000.00 to acquire air tools for scenery fit-ups;

(8) an amount of up to $6,000.00 to replace Front of House staff uniforms;

(9) an amount of up to $1,500.00 to replace carpeting in the accounting offices;

(10) an amount of up to $2,600.00 to acquire additional equipment for the hard of hearing system;

(11) an amount of up to $6,000.00 to upgrade LAN (Local Area Network); and

(12) an amount of up to $11,000.00 to acquire a wireless communication system.



The accumulated balance of the Capital Improvement Fund as of December 31, 1997, is $1,312,908, a net increase of $168,983.00 over the past twelve months.



Thank you for your attention.

23

Contract No. T-20-98: Don Valley Parkway Bridge over

Bloor Street Ramp, Structure Rehabilitation



(City Council on April 16, 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 (April 1, 1998) from the Budget Committee:



Recommendation:



The Budget Committee on March 31, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the recommendations of the Urban Environment and Development Committee, wherein it is recommended that the report (March 3, 1998) from the Interim Functional Lead, Transportation, be adopted.



Background:



The Budget Committee on March 31, 1998, had before it a letter of transmittal (March 24, 1998) from the Urban Environment and Development Committee advising that the Committee on March 23 and 24, 1998 recommended the adoption of the report (March 3, 1998) from the Interim Functional Lead, Transportation, regarding Contract No. T-20-98 for structural rehabilitation of the Don Valley Parkway Bridge over the Bloor Street Ramp.



--------



(Transmittal letter dated March 24, 1998 addressed to the

Budget Committee from

Urban Environment and Development Committee)



The Urban Environment and Development Committee on March 23 and 24, 1998, recommended to the Budget Committee, the Strategic Policies and Priorities Committee, and Council:



(1) the adoption of the attached report dated March 3, 1998, from the Interim Functional Lead, Transportation, regarding Contract No. T-20-98 for structural rehabilitation of the Don Valley Parkway Bridge over the Bloor Street Ramp; and



(2) that this matter be forwarded to Council for consideration at its meeting scheduled to be held on April 16, 1998.



--------



(Report dated March 3, 1998, addressed to the

Urban Environment and Development Committee

from the Interim Functional Lead, Transportation.)



Purpose:



(1) to award a contract for the rehabilitation of the bridge on the Don Valley Parkway over the Bloor Street ramp; and



(2) to lower the speed limit on the expressway in the work zone area during construction.



Funding Source:



The Department's proposed 1998-2002 Capital Works Program includes an amount of $5,800,000.00 under Project No. C-TRO29, Don Valley Parkway Rehabilitation. Contract No. T-20-98 forms part of that program, and the estimated total project cost, including design, supervision and other costs, is $2,360,732.82, which consists of:



(1) Bid Price Amount $2,051,752.82



(2) (a) Design 64,800.00

(b) Construction supervision, 27 weeks at $5,340.00 per week (estimate) 144,180.00



(3) Other Costs (estimate): 100,000.00

(a) quality control testing

(b) traffic signage

(c) expressway closures

(d) materials supplied by Transportation ____________



Total Project Cost $2,360,732.82



The Capital Budget for the City of Toronto, which includes this project, is scheduled to be approved by Council at its meeting on April 15, 1998. Funding is currently available in Capital Account No. C-TR029, Don Valley Parkway Rehabilitation. The Treasurer has previously certified that financing can be provided under the updated Debt and Financial Obligation Limit and that it falls within Corporate Debt Guidelines.



Recommendations:



It is recommended that:



(1) Contract No. T-20-98, for the rehabilitation of the bridge on the Don Valley Parkway over the Bloor Street Ramp, be awarded to Grascan Construction Ltd. and Torbridge Construction Ltd. who submitted the lowest price bid in the amount of $2,051,752.82;



(2) commencing the first day of construction on the Don Valley Parkway (expected to be May 1, 1998) and terminating on the last day of construction (expected to be September 29, 1998), the speed limit be lowered to 60 kilometres per hour at the following locations:



(a) northbound Don Valley Parkway, from a point 400 metres south of the bridge over the Bloor Street ramp to a point 550 metres north of the bridge; and

(b) southbound Don Valley Parkway, from a point 1600 metres north of the bridge over the Bloor Street ramp to a point 450 metres south of the bridge;



(3) the appropriate by-law(s) be amended accordingly;



(4) the appropriate City of Toronto officials be directed to take necessary action to give effect thereto; and



(5) in the event that the 1998-2002 Capital Works Program is not approved by Council at its April 15, 1998 meeting, pre-budget approval in the amount of $2,360,732.82 be granted for this project in order that this project may commence in May;



Comments:



On January 22, 1998, the City Clerk's Department opened tenders for:



Contract No. T-20-98 - Don Valley Parkway Bridge over the Bloor Street Ramp Structure Rehabilitation



Number Name $ Amount



3 Grascan Construction Ltd. and Torbridge Construction Ltd. $2,051,752.82

5 Dufferin Construction Co. $2,171,387.81

6 Bridgecon Construction Ltd. $2,183,332.26

2 Belor Construction Ltd. $2,200,273.10

4 Soncin Construction Corporation $2,286,039.58

1 G. Tari Limited $2,330,035.96

7 Brennan Paving and Construction Ltd. $2,473,570.36

8 Armbro Construction Ltd. $2,484,173.40

9 Underground Services Ltd. $2,966,029.30



Tenders Nos. 2 and 8 contained minor errors in the extension of the unit prices. The revised figures are shown above. Tender No. 6 submitted by Bridgecon Construction Ltd. is considered to be informal since they did not include a price for one of the items in Schedule A of the Form of Tender.



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 rehabilitation work involves the complete replacement of the concrete bridge deck and the repair of the substructure.



It is anticipated that the construction activities on this project will extend from May 1, 1998 to September 29, 1998. During this period, there will be lane restrictions within this section of the Don Valley Parkway. As a result, a lowering of the speed limit to 60 kilometres per hour is recommended to maintain a safe work zone during the construction period.



Conclusion:



Contract No. T-20-98 should be awarded to Grascan Construction Ltd. and Torbridge Construction Ltd. who submitted the lowest price bid for this Contract.



Contact Name and Telephone Number:



Mr. L. Rach, Toronto Transportation, Metro Hall Office, 392-5344.





24

Use of Parks Levy Funding for St. Clare School



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends that prior approval be granted for funds in the amount of $10,000.00 to be allocated from the Parks Levy funding received in 1997 to match funds being provided by the Toronto Catholic School Board and members of the local community for improvement to St. Clare School yard.



The Strategic Policies and Priorities Committee submits the following transmittal letter (April 3, 1998) from the Toronto Community Council:



Recommendation:



The Toronto Community Council requests the Strategic Policies and Priorities Committee to give consideration to the following recommendation from the Toronto Community Council, and to forward its recommendation to City Council for its meeting to be held on April 15, 1998:



"That prior approval be granted for funds in the amount of $10,000.00 to be allocated from the Parks Levy funding received in 1997 to match funds being provided by the Toronto Catholic School Board and members of the local community for improvements to the St. Clare School yard."



Background:



The Toronto Community Council on April 2, 1998 had before it a communication (April 2, 1998) from Councillor Disero, respecting Use of Parks Levy Funding for St. Clare School.



--------



(Communication dated April 2, 1998, addressed to

the Toronto Community Council, from

Councillor Disero)



City Council authorized the use of Parks Levy funds for local improvements in 1997. Subsequently, the Board of Management authorized the expenditure of these funds on a number of projects in the ward and work is proceeding on them.



The Toronto Catholic School Board is prepared to provide $10,000.00 to the improvement of the grounds/parkette at St. Clare School, 124 Northcliffe Boulevard.



This money would be contingent upon the City providing matching funds for a total budget of $20,000.00. I am proposing to use available parks levy funds for this $10,000.00, as the Board wishes to begin work on this site later this month.



Recommendation:



That funds in the amount of $10,000.00 be allocated from the Parks Levy funding received in 1997 to match funds being provided by the Toronto Catholic School Board and members of the local community for improvements to the St. Clare School yard.





25

Property Assessment and Tax Policy System



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 25 of Report No. 4A of The Strategic Policies and Priorities Committee.)



26

1997 Levy on Public Hospitals, Universities and

Colleges and Correctional Institutions



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends the adoption of the recommendation embodied in the following transmittal letter (April 6, 1998) from the Chair of the Assessment and Tax Policy Task Force:



Recommendation:



On behalf of the members of the Assessment and Tax Policy Task Force who were present on April 6, 1998, I am forwarding the following recommendation to the Strategic Policies and Priorities Committee for consideration:



That the Province of Ontario be requested to change the legislation for public hospitals, universities and colleges, and correctional institutions so that these properties pay their fair share of Municipal Property Tax according to their assessed value, and that the Province also be requested to provide the necessary funding to these institutions.



Background:



The Assessment and Tax Policy Task Force, having regard for the fact that no quorum was present at the specified time and in view of the fact that notice had been placed in the newspaper that a public hearing would be held on the Property Assessment and Tax Policy System recently implemented by the Provincial Government, heard presentations from the public on this matter and continued to meet informally and to discuss this and other matters.



The members of the Assessment and Task Policy Task Force who were present had before them a report (April 2, 1998) from the Chief Financial Officer and Treasurer providing information regarding the 1997 levy for public hospitals, universities and colleges and correctional institutions in the City of Toronto. The grants received by municipalities are not based on property assessment and tax rates but rather a flat rate of $75.00 per rated capacity as specified in the Municipal Act.

As Chair of the Assessment and Tax Policy Task Force, I am forwarding the abovementioned recommendation to the Strategic Policies and Priorities Committee for consideration.



--------









(Report dated April 2, 1998, addressed to the

Assessment and Tax Policy Task Force from

the Chief Financial Officer and Treasurer)



Purpose:



The purpose of this report is provide the Task Force with information regarding the 1997 levy for public hospitals, universities and colleges and correctional institutions in the City of Toronto. The grants received by municipalities are not based on property assessment and tax rates but rather a flat rate of $75.00 per rated capacity as specified in the Municipal Act.



Recommendation:



It is recommended that this report be received for information.



Comments:



Public hospitals, university and colleges and correctional institutions in Ontario are exempt from paying property tax. However, Section 157 of the Municipal Act allows municipalities to annually levy up to a maximum of $75.00 for each provincially rated hospital bed (public hospitals); $75.00 for each full time student (universities and colleges); and, $75.00 for each resident place (correctional institutions). The capacity figures for these institutions which are used by municipalities for this levy are determined by the Province and forwarded to municipalities by the Ministry of Municipal Affairs. The grants are paid by the Provincial Government.



The total 1997 levy for these institutions in each of the former municipalities of Metropolitan Toronto was as follow:

1997 Levy for Public Hospitals, University /Colleges, and Correctional Institutions (Based on $75 per rated capacity)
Municipality Capacity Levy
East York 1,160 $87,000
Etobicoke 13,257 $994,275
North York 40,266 $3,019,950
Scarborough 15,044 $1,288,300
Toronto 59,576 $4,468,200
York 1,081 $81,075
TOTAL 130,384 $9,938,800


The provisions in the Municipal Act for the levy have not been changed for 1998. As a result, the Province will continue to pay a grant to municipalities for these types of institutions based on $75.00 per rated capacity.



Staff have completed a preliminary review of the new CVA assessments but have not been able to confirm whether the data provides a complete list all of these types of properties. However, the CVA for properties identified totals $3.7 billion. The application of the 1998 preliminary residential tax rate of for municipal share only (0.78 percent of the total 1.24 percent) results in a total tax of $29 million. Since the Province does not pay grants for the education costs, that portion of the rate is excluded. As grants for these properties have never been based on their assessed values, it may be necessary to confirm the validity of the CVA figures with Ministry of Finance staff.



Since Section 157 of the Municipal Act specifically excludes grants being based on tax rates, the amount to be derived from hospitals, colleges and correctional institutions will continue to be based on the $75.00 flat levy unless legislation is amended.



This report is for information.



Contact Name:



Paul Wealleans, Phone: 392-6955, Fax: 392-0364.





27

Independent Review of Provincial Current Value Assessments



(City Council on April 16, 1998, deferred consideration of this Clause to the Special Meeting of Council to be held on Tuesday, April 28, 1998.)



(See Clause No. 27 of Report No. 4A of The Strategic Policies and Priorities Committee.)





28

Multilateral Agreement on Investment



(City Council on April 16, 1998, adopted this Clause, without amendment.)



The Strategic Policies and Priorities Committee recommends:



(1) the adoption of the following motion moved by Councillor Augimeri and seconded by Councillor Miller, which was referred to the Strategic Policies and Priorities Committee by City Council at its meeting held on March 4, 5 and 6, 1998:



"WHEREAS the federal government is in the process of negotiating the Multilateral Agreement on Investment (MAI) with the 29 member countries of the OECD, with the intention of having a signed agreement by September 1998; and



WHEREAS the citizens of the City of Toronto have had little access to information and informed debate on the Multilateral Agreement on Investment, and its implications at the federal, provincial and local levels; and



WHEREAS there are potential negative impacts of a Multilateral Agreement on Investment on the lives and livelihoods of the residents of the City of Toronto, especially small businesses; and



WHEREAS the draft of the MAI treaty further extends the provisions of the Free Trade Agreement and NAFTA in both the 'National Treatment' and 'Performance Requirements' provisions, which will impact on the entire Municipal, University, School and Hospital sector, and specifically on the City of Toronto's ability to implement purchasing policies and practices that favour local Toronto based businesses and suppliers; and



WHEREAS the MAI treaty, as drafted, would stop municipalities from limiting the use of property by foreign companies, which could have the effect of restricting Council's right to set planning By-laws;



NOW THEREFORE BE IT RESOLVED THAT the City of Toronto urge the Government of Canada to consult widely and in depth with the people of Canada, especially and including, the soliciting of detailed responses from municipal councils, before taking any further action on the Multilateral Agreement on Investment.";

(2) that the Government of Canada be advised that the City of Toronto is opposed to the Multilateral Agreement on Investment and requests that further negotiations cease and desist immediately; and

(3) that the City of Toronto endorse the position taken by the Federation of Canadian Municipalities that the Prime Minister of Canada be petitioned to have the chief negotiator for the Multilateral Agreement on Investment file a permanent and explicit exemption in the Agreement limiting its application to areas of federal jurisdiction, and that City Council's action, together with the supporting material from the Federation of Canadian Municipalities be circulated to:



(a) all municipalities in Canada with a population of over 50,000 and to the Association of Municipalities of Ontario for support;



(b) all MPs representing the City of Toronto with the request that they endorse the City's action and that their responses as to whether or not they endorse Council's actions, and their respective names, be:



(i) forwarded to the Federation of Canadian Municipalities annual meeting; and



(ii) be made available to the public;



(c) the Consulates of the other member countries of the OECD.



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The Strategic Policies and Priorities Committee submits the following communication (March 3, 1998) from Mr. R. W. Pritchard, General Manager of Corporate Services and City Clerk of the Corporation of the City of Kitchener:



This is to inform you that the Council of the Corporation of the City of Kitchener at its regular meeting held on Monday, March 2, 1998, passed the following resolution, namely:



"WHEREAS the federal government is in the process of negotiating the Multilateral Agreement on Investments with the 29 wealthiest countries in the world with the intention of having a signed agreement by September 1998; and



WHEREAS concerns about the agreement have already been raised by 565 organizations, with representatives in 70 countries around the world; and



WHEREAS the citizens of the City of Kitchener have had little access to information and informed debate on the Multilateral Agreement on Investments, from the federal government, and the mainstream media on its implications locally, provincially, federally and globally;



THEREFORE BE IT RESOLVED that the Corporation of the City of Kitchener urge the Government of Canada to suspend negotiations on the Multilateral Agreement on Investments until it has consulted more widely and in depth with the people of Canada, especially and including, the soliciting of detailed responses from municipal councils and their citizens; and further,



That the appropriate City staff be directed to discuss this issue with local MPs and to prepare a report on the implications of this Agreement on municipal government; and further,



That a copy of this resolution be sent to local MPs, the Federation of Canadian Municipalities, the Association of Municipalities of Ontario and Ontario cities having a population greater than 50,000."



The Strategic Policies and Priorities Committee also submits the following communication (April 1, 1998) from Mr. Denis Casey, Acting President, Canadian Union of Public Employees, Local 79:



A motion has been proposed which resolves that the City of Toronto urge the federal government to hold widespread consultation with Canadians on the Multilateral Agreement on Investment (MAI) before taking any further action.



The Multilateral Agreement on Investment is an international agreement, currently being negotiated with the member countries of the Organization for Economic Cooperation and Development (OECD). There is growing and widespread opposition to the treaty by many individuals and organizations. They fear that it will further expand the power of multi-national corporations, guaranteeing them an open market and access to all areas of the Canadian economy.



The MAI is an important issue for municipalities because it will have an impact on some policies and practices currently in effect. Under the MAI treaty, municipalities would not be able to favour local companies over international firms when awarding contracts. In the past, Toronto governments have always recognized the economic importance of supporting local business whenever possible. This is how we have built a strong community. In addition, the MAI would limit municipalities' rights to set some planning policies, and their ability to act in a wide range of other areas. Clearly municipal governmental concerns have not been an important factor in shaping the MAI.



City Councils in Kitchener, Windsor, Woodstock, Owen Sound and Tecumseh have all passed resolutions calling on the federal government to hold public hearings. We urge members of this Committee to join with these cities by supporting the proposed motion.



--------



The Strategic Policies and Priorities Committee also had before it the following material respecting the Multilateral Agreement on Investment (MAI) which has been circulated to all Members of Council under separate cover on April 8, 1998, and copies thereof are on file in the office of the City Clerk:



(i) (March 3, 1998) from Mr. R.W. Pritchard, General Manager of Corporate Services and City Clerk, City of Kitchener;

(ii) (April 2, 1998) from Ms. Helen Hansen and Mr. Robert Hansen;

(iii) (April 1, 1998) from Ms. Anne Hansen;

(iv) (April 1, 1998) from Mr. Denis Casey, Acting President, C.U.P.E. Local 79;

(v) (April 4, 1998) from Mr. Fred Roy, Willowdale Unitarian Fellowship, Social Action Committee;

(vi) (April 7, 1998) from Dr. Rose Anne Dyson, Steering Committee Member, People Against the MAI (PAMAI);

(vii) (April 7, 1998) from Ms. Linda Torney, President, Labour Council of Metropolitan Toronto and York Region;

(viii) (April 7, 1998) from Mr. Robert Olsen;

(ix) (undated) from Councillor Augimeri;

(x) (April 6, 1998) from Mr. Morry Smith;

(xi) (April 7, 1998) from Ms. Colleen Burke and Ms. Mary Roufail;

(xii) (April 7, 1998) from Mr. Brent Patterson;

(xiii) (April 7, 1998) from Mr. Richard Troy;

(xiv) (April 7, 1998) from Mr. Brian Milani, Research Coordinator, Eco Materials Group; and

(xv) (April 7, 1998) from Marjaleena Repo, obo Citizens Concerned About Free Trade, together with a copy of the Spring 1998, edition of a publication titled "True North".



--------



The following persons appeared before the Strategic Policies and Priorities Committee at its meeting held on April 7, 1998, in connection with the foregoing matter:



- Mr. Brent Patterson

- Mr. Bob Olsen

- Dr. Rose Dysan, o.b.o. People concerned about the MAI (PAMAI)

- Mr. Terry Gardner, o.b.o. Science for Peace

- Mr. Morry Smith

- Mr. Richard Troy

- Ms. Sarah Dopp

- Ms. Mary Roufail, o.b.o. the Women's Task Group of Stop MAI - Toronto

- Ms. Colleen Burke, o.b.o. the Women's Task Group of Stop MAI - Toronto

- Mr. Paul Hellyer, President, Waterfront Ratepayers' Association

- Mr. Brian Milani

- Ms. Marjaleena Repo, o.b.o. Citizens concerned about Free Trade

- Mr. Michael Baxter, o.b.o. Regent Park United Church

- Mr. John Valleau

- Ms. Helen McNeill



The following members of Council also appeared before the Strategic Policies and Priorities Committee at its meeting held on April 7, 1998, in connection with the foregoing matter:



- Councillor Augimeri

- Councillor Layton



(City Council on April 16, 1998, had before it, during consideration of the foregoing Clause, a communication (April 7, 1998) from Ms. F. Deller, Policy Analyst, Federation of Canadian Municipalities, advising that the Multilateral Agreement on Investment (MAI) is on the agenda for the Big City Mayors Caucus to be held on April 24 and 25, 1998, in Toronto, and forwarding background material outlining concerns regarding the impact of the MAI on municipal governments.)



(City Council also had before it, during consideration of the foregoing Clause, a communication (April 1, 1998) from Ms. A. Hansen, Toronto, in support of the resolution to urge the Canadian government to consult widely with Canadians and with municipalities before taking any further action on the Multilateral Agreement on Investment.)





29

Other Items Considered by the Committee



(City Council on April 16, 1998, received this Clause, for information.)



(a) Canadian Auto Workers (Caw) Campaigns To Keep Tariff On New Imports



The Strategic Policies and Priorities Committee reports having referred the communication (February 12, 1998) from the Clerk of the City of Brampton to the Economic Development, Culture and Tourism Committee for consideration and a report to Council:



(i) (February 12, 1998) from the Clerk of the City of Brampton requesting the City of Toronto to supports its resolution requesting the federal government to reverse its recent decision on auto parts and cease any action, legislative or otherwise, that would lead to the elimination of auto tariffs on vehicle assembly and fully commit to protect the principles of the auto pact.



(b) Resolution - Association Of Municipalities Of Ontario (AMO)



The Strategic Policies and Priorities Committee reports having received the communication (February 3, 1998) from the Chief Administrative Officer of the District Municipality of Muskoka:



(i) (February 3, 1998) from the Chief Administrative Officer of the District Municipality of Muskoka, requesting endorsement of a resolution passed by the Council of The District Municipality of Muskoka at its meeting on February 2, 1998, advising the Association of Municipalities of Ontario (AMO) that AMO does not and shall not represent the views or opinions of their municipality in negotiations with the Province of Ontario.



(c) Labour Relations Strategy



The Strategic Policies and Priorities Committee reports having received a confidential presentation given by Mr. Harold Ball, Director of Labour Relations, on a labour relations strategy.



(d) City of Toronto 1998 Capital Budget - North York Community Council (March 26, 1998)



The Strategic Policies and Priorities Committee reports having referred the transmittal letter (April 1, 1998) from the Budget Committee to the Chief Administrative Officer for a report back to the Strategic Policies and Priorities Committee on Terms of Reference for a complete review of fees and service levels throughout the new City of Toronto:



(i) (April 1, 1998) from the Budget Committee recommending to the Strategic Policies and Priorities Committee, and Council, that:



(1) the following recommendations of North York Council be endorsed:



(a) the establishment of a User Fee Task Force no later than the end of the next meeting of Council scheduled for April 16, 1998, and that it be mandated to deliver to Council for consideration at its meeting of October 1, 1998, recommendations on the user fee structure for the City of Toronto; and



(b) the appointment of Councillor Mammoliti as Chair of the Task Force; and



(2) the terms of reference for this User Fee Task Force be forwarded to the appropriate Standing Committee.



(e) Cities Of Tomorrow Forum



The Strategic Policies and Priorities Committee reports having received the report (March 12, 1998) from the City Clerk, reporting as requested by City Council at its special meeting on February 12, 1998, on the actions taken by the former Metropolitan Chairman on holding a Constitutional Conference with the Cities of Vancouver and Montreal:



(i) (March 12, 1998) from the City Clerk, summarizing the actions taken by the former Metropolitan Chairman on holding a Constitutional Conference with the Cities of Vancouver and Montreal.











Respectfully submitted,

MEL LASTMAN,

Chair

Toronto, April 7, 1998





(Report No. 4 of The Strategic Policies and Priorities Committee, including additions thereto, was adopted, as amended, by City Council on April 16, 1998.)







TABLE OF CONTENTS



REPORTS OF THE STANDING COMMITTEES

AND OTHER COMMITTEES





As Considered by

The Council of the City of Toronto

on April 16, 1998




STRATEGIC POLICIES AND PRIORITIES COMMITTEE

REPORT No. 4



Clause Page

1 Appointment of Commissioner of Economic Development,
Culture and Tourism 2248

2 Voluntary Separation Program for Bargaining Unit Employees 2249

3 Manson Property at 5421 Lawrence Avenue East 2249

4 Funding Request - Conditions of Mount Royal Park, Montreal,
Quebec Following Ice Storm 2256

5 Scholarship Fund - University of Toronto Scarborough College
Ontario Student Opportunity Trust Fund (OSOTF) 2259

6 Development Charges 2261

7 Process to Develop an Agreement on Matters of Mutual Interest
Between the City of Toronto and the Greater Airports Authority

to Lester B. Pearson International Airport 2269

8 Business Improvement Areas: Interim Administrative Procedures
for 1998 and Municipal Code Amendments for the
(Former) City of Toronto 2269

9 Terms of Reference - Audit Committee 2283

10 Audit Services 2288

11 Resolution - Business Education Tax Rate in Ontario 2307

12 Provincial Property Tax System 2307

13 Proposed New Municipal Act - Ministry of Municipal Affairs
and Housing Consultation Document 2307

14 Toronto City Council's Response to Draft
Greater Toronto Services Board Act 2308

15 Municipal Referendum Legislation 2320

16 Solid Waste Management Fees 2323

17 A New Official Plan for the City of Toronto 2338

18 Request for Change of Quorum -
Municipal Grants Review Committee 2346

19 Increase in Property Tax Reassessment 2347

20 Contract No. T-23-98: City of Toronto Roads at Four Locations 2347

21 Replacement of Lighting on the F.G. Gardiner Expressway
from the Humber River to the Don Valley Parkway 2351

22 St. Lawrence Centre for the Arts - Request to Withdraw Funds
from the Capital Improvement Fund 2356

23 Contract No. T-20-98: Don Valley Parkway Bridge over
Bloor Street Ramp, Structure Rehabilitation 2358

24 Use of Parks Levy Funding for St. Clare School 2361

25 Property Assessment and Tax Policy System 2362

26 1997 Levy on Public Hospitals, Universities and
Colleges and Correctional Institutions 2363

27 Independent Review of Provincial Current Value Assessments 2365

28 Multilateral Agreement on Investment 2365

29 Other Items Considered by the Committee 2370

 

   
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