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TABLE OF CONTENTS

REPORTS OF THE STANDING COMMITTEES

AND OTHER COMMITTEES

As Considered by

The Council of the City of Toronto

on May 13 and 14, 1998

STRATEGIC POLICIES AND PRIORITIES COMMITTEE

REPORT No. 8

1Appointments to the Boards of Management for Business Improvement Areas and Amendments to the (former Toronto)Municipal Code Chapter 20, Business Improvement Areas(Various Wards)

2Toronto Transit Commission: Need for Expansion of Union Subway Station

3Audit Services

4Committee on the Status of Women

5New Logo for the City of Toronto

6Corporate Management Framework

7Millennium Celebrations and Establishment of a Task Force

8Solid Waste Management Fees

9Toronto Heritage Fund Grant Application -45 South Drive

10Toronto Heritage Fund Grant Application -427 Bloor Street West (Trinity St. Paul's Church)

11Toronto Heritage Fund Grant Application -49 Wellington Street East (Flatiron Building)

12Ad Hoc Requests for City Grants

13Financial Administration of the Cultural Grants Budget

14City of Ottawa Request for Financial Support -International Institute of Municipal Clerks (IIMC) Conference- May, 1999

15Request for Special Meeting of Council to Deal withTax Policy and Tax Rate Matters

16Establishment of an Auditor General's Office

17Other Items Considered by the Committee



City of Toronto

REPORT No. 8

OF THE STRATEGIC POLICIES AND PRIORITIES COMMITTEE

(from its meeting on May 5, 1998,

submitted by Mayor Mel Lastman , Chair)

As Considered by

The Council of the City of Toronto

on May 13 and 14, 1998

1

Appointments to the Boards of Management for Business

Improvement Areas and Amendments to the (former Toronto)

Municipal Code Chapter 20, Business Improvement Areas

(Various Wards)

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the following report (April 21, 1998) from the Commissioner of Economic Development, Culture and Tourism:

Purpose:

Changes to membership of Boards of Management for Business Improvement Areas require Council approval and a by-law amendment. Attached is Schedule A detailing the amendments to (former Toronto) Municipal Code, Chapter 20 and Appendix 1 listing the names of the nominees to be appointed.

Source of Funds:

No funds required. Business Improvement Area operating budgets are raised by a special levy on members and will be brought forward in a separate report for approval.

Recommendations:

"It is recommended that:

(1)in accordance with the elections held at the Business Improvement Area Annual General Meetings, amendments be made to Schedule A Individual Boards of Management, of the (former Toronto) Municipal Code Chapter 20, Business Improvement Areas as set out in the attached Schedule A. These changes are specific to Number of Members and Members Needed for Quorum and are highlighted by "Changes From and To";

(2)Council appoint the nominees listed in Appendix 1 of this report to the Boards of Management for Bloordale Village, Gerrard India Bazaar, Mimico Village, and St. Lawrence Neighbourhood Business Improvement Areas. The term of office is to expire on November 30, 2000, or as soon thereafter as successors are appointed. Each of the named nominees meets the requirements of Section 220 of the Municipal Act, as amended by Bill 106.

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

Comments:

Following the elections held at the Annual General Meetings of Bloordale Village, Gerrard India Bazaar and St. Lawrence Neighbourhood Business Improvement Areas, amendments are required to the number of members and members needed for quorum. These amendments must be reflected in Schedule A Individual Boards of Management of the (former Toronto) Municipal Code Chapter 20, Business Improvement Areas.

Following the election held at the Annual General Meeting of Mimico Village Business Improvement Areas and as per Councils resolution at it's meeting of February 5 & 6, 1998, attached in Appendix 1 are the nominations for appointments to other Business Improvement Areas Boards of Management in the former Area Municipalities.

Conclusions:

These amendments should be reflected in Schedule A, Individual Boards of Management of the (former Toronto) Municipal Code Chapter 20, Business Improvement Areas.

The nominees listed in Appendix 1 of this report should be appointed to the Business Improvement Area, Boards of Management. The terms of office are to expire on November 30, 2000, or as soon thereafter as successors are appointed. Each of the named nominees meets the requirements of Section 220 of the Municipal Act, as amended by Bill 106.

Contact Name:

Ingrid Girdauskas, (tel.) 392-1134, (fax) 392-0675, (e-mail) igirdaus@city.toronto.on.ca

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SCHEDULE A

BUSINESS IMPROVEMENT AREAS

INDIVIDUAL BOARDS OF MANAGEMENT

Name ofBy-lawMembers

Business WhichNumberCouncil MembersNeeded

ImprovementDesignatesofFor

AreaAreaMembersNumberWardQuorum

ChangedChanged

FromToFrom To

Bloordale1995-0688 910 4Davenport 44

VillageTrinity-Niagara

Gerrard 590-811216 1East Toronto77

India Bazaar

St. Lawrence1996-0406 6 8 1Downtown 34

Neighbourhood

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APPENDIX 1

BLOORDALE VILLAGE BIA

Susan Tibaldi425 Margueretta St.

Toronto, Ont. M6H 3S6

Danny GinBank of Nova Scotia

1251 Bloor St. W.

Toronto, Ont. M6H 1N6

Vito PasquarielloVito's Barber Shop

1258 Bloor St. W.

Toronto, Ont. M6H 1N5

Kulwant GillGulmour Restaurant

1274 Bloor St. W.

Toronto, Ont. M6H 1N8

Spiro KoumoudourosHouse of Lancaster

1215 Bloor St. W.

Toronto, Ont. M6H 1N4

Morey Papier106 Thornbrook Crt

Thornhill, Ont. L4J 7X4

GERRARD INDIA BAZAAR BIA

Kanweljit Singh KhoranaKala Kendar (Canada) Ltd.

1440 Gerrard St. E.

Toronto, Ont. M4L 1Z8

S. SenthivelNalli International (Canada)

1447 Gerrard St. E.

Toronto, Ont. M4L 1Z9

Inder JandooSonu Saree Place

1420 Gerrard St. E.

Toronto, Ont. M4L 1Z6

P.S. BajajFashion Plus Imports Ltd.

Roop Shingar

1404 Gerrard St. E.

Toronto, Ont. M4L 1Z4

Balwant S. JajjB.J. Supermarket

1449 Gerrard St. E.

Toronto, Ont. M4L 1Z9

Chandra KantMadras Durbar

1435 Gerrard St. E.

Toronto, Ont. M4L 1Z7

Jitender SinghChandan Fashion

1439 Gerrard St. E.

Toronto, Ont. M4L 1Z7

Sudesh K. BahalBar-B-Que Hut

1449 Gerrard St. E.

Toronto, Ont. M4L 1Z9

Chand KapoorSangeet Indian Cuisine

1424 Gerrard St. E.

Toronto, Ont. M4L 1Z6

Gobind MahataniNucreation Fashions Ltd.

1414 Gerrard St. E.

Toronto, Ont. M4L 1Z4

Gurnam Singh MultanjSkylark Restaurant

1433 Gerrard St. E.

Toronto, Ont. M4L 1Z7

Devindar SharmaSatyam

1445 Gerrard St. E.

Toronto, Ont. M4L 1Z9

Kishor ChatlaniMaharani Fashion

1417 Gerrard St. E.

Toronto, Ont. M4L 1Z7

Kumar AshokIndian Record Shop

1428 Gerrard St. E.

Toronto, Ont. M4L 1Z6

Mohammad Azhar KahnChandni Chowk Restaurant

1430 Gerrard St. E.

Toronto, Ont. M4L 1Z6

MIMICO VILLAGE BIA

John BaggsBank of Nova Scotia

406 Royal York Rd.

Toronto, Ont. M8Y 2R5

Robert BozzoSanRemo Bakery

374 Royal York Rd.

Toronto, Ont. M8Y 2R3

Anthony FalsittaVac Shak Vacuums

396 Royal York Rd.

Toronto, Ont. M8Y 2R5

Ed GallantEd Gallant Service

431 Royal York Rd.

Toronto, Ont. M8Y 2R8

Joe GiovencoGiovenco Shoes

382 Royal York Rd.

Toronto, Ont. M8Y 2R3

William KasselKassel's Pharmacy

396 Royal York Rd.

Toronto, Ont. M8Y 2R5

ST. LAWRENCE NEIGHBOURHOOD BIA

Michael ComstockWine Workshop Ltd.

58 Wellington St. E.

Toronto, Ont. M5E 1T3

Susan BellanFrida Craft Store39 Front St. E.

Toronto, Ont. M5E 1B3

Joseph BronsonPhotography

56 The Esplanade, Ste. 504

Toronto, Ont. M5E 1A7

Bob EisenbergYork Heritage Properties

64 Merton St., Ste. B

Toronto, Ont. M4S 1A1

Stanley JanecekWhitehouse Meats

St. Lawrence Market

93 Front St. E.

Toronto, Ont. M5E 1C2

Sandy KaneLe Papillon

16 Church St.

Toronto, Ont. M5E 1M1

Andrew LaffeyHot House Cafe

35 Church St.

Toronto, Ont. M5E 1T3

2

Toronto Transit Commission: Need for Expansion of

Union Subway Station

(City Council on May 13 and 14, 1998, amended this Clause by:

(1)rescinding Part (2) of the action of the Urban Environment and Development Committee, viz.:

"(2)referred the issue of the development of a crowd control management plan to the Commissioner of Urban Planning and Development Services, with a request that she submit a report thereon to the meeting of the Urban Environment and Development Committee scheduled to be held on June 15, 1998;"; and

(2)adding thereto the following:

"It is further recommended that:

(1)the issue of the development of a crowd control management plan be referred to the Chief General Manager of the Toronto Transit Commission for report thereon to the Urban Environment and Development Committee; and

(2)the Commissioner of Urban Planning and Development Services be requested to submit a report to the Urban Environment and Development Committee addressing the issue of anticipated over-crowding which will impact on the City's road infrastructure as a result of the proposed development in this area, including the stadium for the Toronto Raptors and the Toronto Maple Leafs.")

The Strategic Policies and Priorities Committee recommends that City Council:

(1)establish a special reserve fund for private-sector contributions toward the cost of expanding Union Subway Station;

(2)direct the Chief Administrative Officer, in consultation with the Chief Financial Officer, to establish a mechanism for obtaining funding from the Federal and Provincial governments, GO-Transit, the private-sector including contributions from the 905 area to this fund, as a condition of approval of all new developments which contribute to the overcrowding of the Union Station Subway station; and

(3)refer the following concerns to the Commissioner of Urban Planning and Development Services for consideration at the appropriate time:

(i)the passenger loads and capacity of the Union Station Subway Station; and

(ii)structural and retrofit issues related to all three users at Union Station as well as a Master Plan for future Subway, VIA and GO Transit use.

Recommendations:

The Urban Environment and Development Committee on April 20, 1998, recommended to:

(A)the Strategic Policies and Priorities Committee, and Council, the adoption of Recommendation No.(2) of the Toronto Transit Commission, embodied in the communication dated February 26, 1998, from the General Secretary of the Commission, viz:

"The Commission took the following action:

(2)approved requesting the City of Toronto Council to:

(a)establish a special reserve fund for private-sector contributions toward the cost of expanding Union Subway Station; and

(b)direct City staff to establish a mechanism for obtaining private-sector contributions to this fund as a condition of approval of all new developments within the catchment area of Union Subway Station, including the Railway Lands and Harbourfront; that is, those developments which contribute to the overcrowding of the station;"; and

(B)the Strategic Policies and Priorities Committee that this matter be submitted to the meeting of City Council scheduled to be held on May 13, 1998.

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

(1)requested the Chief Administrative Officer and the Chief Financial Officer and Treasurer to submit a joint report directly to Council, for consideration with this matter on May 13, 1998, demonstrating how the establishment of a special reserve fund for private-sector contributions toward the cost of expanding Union Subway Station, and a mechanism for obtaining such contributions, can be achieved;

(2)referred the issue of the development of a crowd control management plan to the Commissioner of Urban Planning and Development Services, with a request that she submit a report thereon to the meeting of the Urban Environment and Development Committee scheduled to be held on June 15, 1998; and

(3)received the aforementioned communications (March 31, 1998) from Mr. Tom Anselmi, Vice-President and Project Director, Maple Leaf Gardens, Limited, and (April 17, 1998) from the General Secretary, Toronto Transit Commission.

Background:

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

(i)(February 26, 1998) from the General Secretary, Toronto Transit Commission (Commission), advising that the Commission on February 25, 1998, considered report No.(6), entitled "Need for Expansion of Union Subway Station"; and setting out the action taken by the Commission with respect thereto;

(ii)(March 31, 1998) from Mr. Tom Anselmi, Vice-President and Project Director, Maple Leaf Gardens, Limited, in response to the foregoing communication from the General Secretary, Toronto Transit Commission; and respectfully advising that Maple Leaf Gardens, Limited is not prepared to consider contributing to the expansion of Union Subway Station; and

(iii)(April 17, 1998) from the Chief General Manager, Toronto Transit Commission, submitting a letter dated April 17, 1998, addressed to Mr. Tom Anselmi, Maple Leaf Gardens, Limited, in response to Mr. Anselmi's letter of March31, 1998; and urging Maple Leaf Gardens, Limited (MLGL) to reconsider its position regarding a contribution toward a special reserve fund for private-sector contributions toward the cost of expanding Union Subway Station.

--------

(Communication dated February 26, 1998, addressed to the City Clerk

from the General Secretary, Toronto Transit Commission)

At its meeting on Wednesday, February 25, 1998, the Toronto Transit Commission (Commission) considered the attached report, entitled "Need for Expansion of Union Subway Station".

The Commission took the following action:

(1)received the report for information, noting that:

(i)as indicated in the staff report, entitled "TTC's Ability to Serve Multiple Sports Stadiums at Union Station", which was considered by the Commission at its meeting on May 13, 1997, the capacity of Union Subway Station, under realistic operating conditions, is insufficient to accommodate the peak demands which would occur if high-attendance events at both SkyDome and the Air Canada Centre were to conclude at the same time;

(ii)an interim crowd control management plan must be developed, jointly between the Air Canada Centre, SkyDome, Toronto Police, and the TTC, to restrict the volumes of customers entering the station, right at the station entrances, whenever customer demand reaches a critical level;

(iii)the platform area of Union Subway Station should be enlarged as a permanent means of accommodating both the peak customer demand related to stadium events, and the increased weekday peak period demands resulting from intensification and future development near Union Station;

(iv)staff have developed a functional plan for increasing the station capacity which involves constructing a new platform south of the existing subway tracks; this would be a very costly improvement, and additional funding would have to be found outside of the TTC's current Capital Budget for this purpose;

(v)staff will be requesting funds, in the 1999-2003 Capital Budget submission, for the preparation of a detailed design and cost estimate for this expansion;

(2)approved requesting the City of Toronto Council to:

(a)establish a special reserve fund for private-sector contributions toward the cost of expanding Union Subway Station;

(b)direct City staff to establish a mechanism for obtaining private-sector contributions to this fund as a condition of approval of all new developments within the catchment area of Union Subway Station, including the Railway Lands and Harbourfront; that is, those developments which contribute to the overcrowding of the station;

(3)approved requesting Maple Leaf Gardens, Limited to make the initial contribution to this fund in conjunction with its plans to integrate the Air Canada Centre with Union Station itself; and

(4)approved forwarding a copy of this report to City of Toronto Council, the City of Toronto Planning Department, the Chief Administrative Officer of the City of Toronto and Maple Leaf Gardens, Limited.

The Commission also requested the Chair and the Chief General Manager to meet with the Mayor of the City of Toronto to impress upon him the importance of capital needs for Union Station.

The foregoing is forwarded to City Council, the City of Toronto Planning Department, the Chief Administrative Officer of the City of Toronto and Maple Leaf Gardens, Limited for information and appropriate consideration of the requests noted above.

--------

(Toronto Transit Commission Report No. 6, entitled

"Need for Expansion of Union Subway Station".)

Recommendations:

It is recommended that the Commission:

(1)receive this report for information, noting that:

(a)as indicated in the staff report, entitled "TTC's Ability to Serve Multiple Sports Stadiums at Union Station", which was considered by the Commission at its meeting on May 13, 1997, the capacity of Union Subway Station, under realistic operating conditions, is insufficient to accommodate the peak demands which would occur if high-attendance events at both SkyDome and the AirCanada Centre were to conclude at the same time;

(b)an interim crowd control management plan must be developed, jointly between the Air Canada Centre, SkyDome, Toronto Police, and the TTC, to restrict the volumes of customers entering the station, right at the station entrances, whenever customer demand reaches a critical level;

(c)the platform area of Union Subway Station should be enlarged as a permanent means of accommodating both the peak customer demand related to stadium events, and the increased weekday peak period demands resulting from intensification and future development near Union Station;

(d)staff have developed a functional plan for increasing the station capacity which involves constructing a new platform south of the existing subway tracks; this would be a very costly improvement, and additional funding would have to be found outside of the TTC's current Capital Budget for this purpose;

(e)staff will be requesting funds, in the 1999-2003 Capital Budget submission, for the preparation of a detailed design and cost estimate for this expansion;

(2)request City of Toronto Council to:

(a)establish a special reserve fund for private-sector contributions toward the cost of expanding Union Subway Station;

(b)direct City staff to establish a mechanism for obtaining privatesector contributions to this fund as a condition of approval of all new developments within the catchment area of Union Subway Station, including the Railway Lands and Harbourfront; that is, those developments which contribute to the overcrowding of the station;

(3)request Maple Leaf Gardens, Limited to make the initial contribution to this fund in conjunction with its plans to integrate the AirCanada Centre with Union Station itself; and

(4)forward this report to the City of Toronto Council, the City of Toronto Planning Department, the Chief Administrative Officer of the City of Toronto, and Maple Leaf Gardens, Limited.

Background:

In April, 1997, in reaction to the announcements by Maple Leaf Gardens, Limited and the Toronto Raptors Basketball Club to build separate new stadiums close to Union Station, TTC staff conducted a review of Union Subway Station and its ability to serve the surge demands on the subway system from the SkyDome and one other stadium.

At its meeting on May 13, 1997, the Commission considered the staff report, entitled "TTC's Ability to Serve Multiple Sports Stadiums at Union Station", which advised that, if a new stadium and SkyDome both held high-attendance events which ended at the same time, Union Subway Station, under realistic operating conditions, would be unable to accommodate an unrestricted volume of customers choosing to take transit.

Staff concluded that an interim crowd control management plan would have to be developed to restrict customers from entering the station whenever customer demand were to reach a critical level. Further, in order to provide a more permanent solution to this problem, and to accommodate the future growth in demand from continuing intensification and development of the area, the capacity of the station's platform would have to be increased.

This report provides an update on the matter.

Discussion:

As noted in the attached May 13, 1997 report, Union Subway Station, which is the focal point for transit travel to/from the downtown stadium area, is the worst station in the TTC system for serving large volumes of customers. Its platform is unusually small and disjointed; there are very narrow spaces adjacent to the stairways and escalators leading to and from the platform; escalators deliver customers into very constrained platform areas; and passenger movement is significantly limited by the presence of elevators, escalators, stairways, and structural supports.

The passenger demand versus capacity problem is two-fold. The analysis in the previous report focused primarily on the surge demands which would result from coincident events at two sports stadiums. This remains a concern as the Air Canada Centre proceeds. There are similar concerns with Union Station's ability to accommodate the projected increases in transit use in this area on a typical weekday. Extensive developments planned in the surrounding areas, such as those recently approved on the Molson lands, the Grand Adex mega-development in the Railway Lands, and ongoing development in the Harbourfront area, all promise to add to the demands on Union Station, eventually, and push it past its practical capacity.

TTC staff have done preliminary design work pertaining to the expansion of Union Subway Station and recommend constructing a new subway platform, south of the existing tracks, which would be dedicated for use by customers waiting to travel north via the Yonge Subway line. The existing centre platform could then be dedicated entirely for use by customers traveling north via the University Subway Line.

A very preliminary estimate of the cost of this station expansion is $40 million. The TTC's current capital budget does not include any funding for the expansion of Union Subway Station. Given the serious financial pressures facing the City of Toronto, and the fact that there will be no further contributions to the TTC's capital program from the Province, it will be necessary to look for new sources of funding, from the logical beneficiaries of an efficient and safe Union Station, to supplement whatever funding the City of Toronto may be able to provide.

It is recommended that a special reserve fund be established for the expansion of Union Subway Station. Recognizing that Maple Leaf Gardens Ltd. will be integrating the Air Canada Centre with Union Station, and given the increased levels of activity in Union Subway Station which will result from this new development, it would be appropriate that Maple Leaf Gardens Ltd. be requested to make the initial contribution to that fund in conjunction with their planned improvements.

In addition, City of Toronto staff should be requested to develop a mechanism whereby approval of future developments in the downtown would be conditional on a contribution to this fund. Although, in the past, City staff have avoided the use of special development levies, there may be strategies which would not result in any additional costs to developers. For example, the Railway Lands Transportation Study (September, 1995), discussed a strategy whereby any contribution to transit made by a developer could be offset through a reduction in the amount of parking required by the municipal by-law. Alternatively, current development charges could include an amount earmarked for this project. Such strategies could be used to obtain contributions for the expansion of Union Subway Station while, at the same time, helping to achieve the relatively high transit market share which is projected for future development in this area and which is appropriate for an area of such high density.

Summary:

Union Subway Station is the focal point for transit travel to/from the downtown area. It is the worst station in the TTC system for serving large volumes of customers because its platform is unusually small and disjointed, with many features which constrain customer movement and distribution.

If the Air Canada Centre and SkyDome were to both hold high-attendance events which were to end at the same time, Union Subway Station, under realistic operating conditions, would be unable to accommodate an unrestricted volume of customers choosing to take transit.

There are many planned or in-progress developments, in the area surrounding Union Station, which will add to the typical weekday demands on the station and which will, eventually, push it past its practical capacity.

The only long-term solution to this capacity problem is to expand the platform capacity of this station by constructing a new subway platform, south of the existing tracks, which would be dedicated for use by customers waiting to travel north via the Yonge Subway line. Such an expansion would cost an estimated $40 million which is not included in the TTC's current Capital Budget.

Given known funding constraints at the City of Toronto, and in the absence of any further capital funding from the Province, it would be appropriate, and likely necessary, to obtain some proportion of the funds for such an expansion from new developments within the Union Subway Station catchment area, which would be the logical beneficiaries of an expanded, efficient, and safe subway station. Maple Leaf Gardens, Limited, builders of the new Air Canada Centre, which will be directly connected to the Union Station, should be the first contributor to a special reserve fund for the expansion of Union Subway Station.

--------

(Toronto Transit Commission Report dated May 13, 1997,

entitled "TTC's Ability to Serve

Multiple Sports Stadiums at Union Station.")

Recommendations:

It is recommended that the Commission:

(1)receive this report, and the accompanying discussion paper, for information, noting that:

(a)staff support the development of stadiums in the downtown core as a means of increasing TTC ridership and transit market share;

(b)staff support the enlargement of the Union Station platform area to accommodate growing customer demand on the station, and to support future development and intensification;

(c)additional funding for expansion of the station must be found outside of the TTC's current Capital Budget. The stadium currently under consideration is just one contributor to the demand at Union Station;

(d)an interim crowd control management plan must be developed, jointly between the stadiums, Metro Police, and the TTC, to restrict the volume of customers entering the station, right at the surface-level entrances, whenever customer demand reaches a critical level;

(e)Union Subway Station, which is the focal point for transit travel to/from the downtown stadium area, is the worst station in the TTC system for serving large volumes of customers because its platform is unusually small and disjointed, with very narrow spaces adjacent to stairways and escalators, escalators which deliver customers into very constrained areas, and passenger movement significantly limited by the presence of elevators, escalators, and stairways;

(f)if a new stadium is built close to Union Station, and that stadium and SkyDome hold high-attendance events at the same time, the percentage of customers using transit to get to and from the stadiums will increase from current levels because traffic congestion in the area would be severe and parking would be costly and difficult to find;

(g)if the stadiums were relatively full and the events end at the same time, then, under realistic operating conditions, the customer demand at UnionStation in a peak 20-minute period following the end of the events would exceed the practical and safe capacity of the stairways, escalators, and subway platform at Union Station;

(h)in a situation of continual heavy demand, which would be generated by two concurrent stadium events, a delay in subway service of even onetotwo minutes, which is manageable during normal peak period operation on weekdays, would create a dangerous overcrowding condition on the constrained subway platform of Union Station; and

(2)request that a copy of the report be forwarded to Metropolitan Toronto Council, City of Toronto Council, the Metropolitan Toronto Planning Department, the City of Toronto Urban Development Services, Maple Leaf Gardens, Limited, The Toronto Raptors Basketball Club, and SkyDome Corporation.

Background:

The TTC supports and encourages development and intensification in existing transit corridors to increase ridership and improve public transit's share of travel in the city.

The construction of stadiums in downtown Toronto is an opportunity for the TTC to provide enhanced public transit in support of local development.

The 40-year-old Union Station will reach a capacity limit, under certain operating conditions. This will necessitate expansion of the platform area in order to provide safe and convenient public transit, and to accommodate further development and intensification in the surrounding area.

Maple Leaf Gardens, Limited and the Toronto Raptors Basketball Club have both announced their intention to build new stadiums close to Union Station. At least one new stadium will be built, and this means that two major stadiums - SkyDome and a new stadium- will be within a relatively close distance of Union Subway Station.

It is appropriate to review the TTC's ability to effectively and safely serve the customer demand which could be generated by two such stadiums close to Union Station.

Discussion:

The attached discussion paper presents a number of possible scenarios of stadium events and the resulting customer demand which would occur at Union Subway Station, under a number of explicit assumptions regarding stadium attendance, transit market share, supplemental service arrangements, and the physical constraints of Union Subway Station.

The paper concludes that Union Subway Station, which is the focal point for transit travel to/from the downtown stadium area, is the worst station in the TTC system for serving large volumes of customers because its platform is unusually small and disjointed.

If a new stadium is built close to Union Subway Station, and that stadium and SkyDome hold high-attendance events which end at the same time, then Union Station, under realistic operating conditions, would be unable to accommodate the volume of customers choosing to take transit.

Under conditions of a constant high volume of customers entering the station, such as from two concurrent stadium events, even small delays to subway train service can quickly result in unsafe crowding conditions on the platform at Union Subway Station. If the TTC were serving the customer demand from two stadium events, and any service delays were to occur, then, under every tested volume of customer demand, demand would exceed station capacity, and overcrowding in the station would occur - at increasing levels of danger and risk to customers.

Union Station is one of the least suitable platforms to handle surge passenger loads. In order to accommodate any future growth in demand as a result of area development/intensification, the configuration of the station must be improved.

(Discussion Paper, entitled

"TTC's Ability to Serve Multiple Sports Stadiums at Union Station".)

Introduction:

This report discusses the ability of the TTC to carry the highly-concentrated customer demands which could be generated by two major events ending at the same time, in the immediate vicinity of Union Subway Station: one at a new stadium and one at SkyDome.

Major Assumptions:

(a)Facilities and Capacity/Attendance:

SkyDome - 50,000 customers; New Stadium - 20,000 customers.

(b)Situation Which Would Generate Highest Level of Customer Demand:

Two events conclude at the same time: one at SkyDome, and one at New Stadium.

(c)Stadium Clearance Times:

20 minutes.

(d)Pattern of Customer Arrivals at Union Subway Station:

Because the proposed New Stadium is relatively close to Union Station, all transit customers from this stadium would arrive at Union Station, at an even rate, within a 20-minute period following the conclusion of an event. Because SkyDome is further from Union Station and requires customers to walk a greater distance, in a worst case, 75 percent of SkyDome customers who are destined for Union Station would arrive there within this same 20-minute period.

(e)Percentage of Stadium Customers Who Travel by Transit:

Based on the TTC's most recent ridership counts, 16 percent of people attending a SkyDome eventtravel by subway (13.6 percent to/from Union Station and 2.4 percent to/from St.AndrewStation), and 20 percent of people attending an event at the current Maple Leaf Gardens travel by subway. These transit market shares are explicitly altered in the scenarios which are discussed in this paper.

(f)Direction of Subway Travel from Union Station:

It is assumed that, of all customers using the subway from Union Station, the majority travel north via the Yonge subway line. The exact distribution between the Yonge line and the University-Spadina line varies slightly according to the scenario under discussion.

(g)Time of Day of Events:

If two stadium events were to conclude at the same time, this would most likely occur later in the evening on weekdays or Saturdays. This situation would be unlikely to occur during the afternoon peak period on a weekday, based on historical observations regarding the time of major stadium events in Metro Toronto.

Other minor assumptions are stated explicitly, where applicable, in the scenarios which follow.

Possible Scenarios of Stadium Events and

Resulting Customer Demand at Union Subway Station:

Scenario 1:One Event at New Stadium; Existing Transit Market Share:

In this scenario, 20 percent of New Stadium customers would use the subway, resulting in a peak demand of 4,000 customers within 20 minutes.

Scenario 2:Two Concurrent Stadium Events; Existing Transit Market Share:

In this scenario, 13.6 percent of SkyDome customers, and 20 percent of New Stadium customers, would use the subway. This would result in a demand of 9,100 customers within a 20-minute period at Union Station.

Scenario 3:Two Concurrent Stadium Events; Higher Transit Market Share:

Simultaneous major events at two stadiums which are very close to each other would be expected to make driving to these events much less desirable, because parking would be costly and difficult to find, and traffic congestion in the area would be severe. This would result in more people using transit to get to the stadiums in the area. The percentage of customers who would use transit would be increased to 17 percent to/from SkyDome, and to 25 percent to/from New Stadium. This would result in a demand of 11,400 customers at Union Station within a 20-minute time period.

Scenario 4:Two Concurrent Stadium Events; Even Higher Transit Market Share:

In the near future, a number of the parking facilities in the downtown stadium area may be replaced by development, resulting in a further increase to transit's share of this travel market. The percentage of customers who would use transit under this scenario would be increased to 20 percent to/from SkyDome and to 30 percent to/from New Stadium. This would result in a demand of 13,500customers at Union Subway Station within a 20-minute period.

Customer Capacity at Union Subway Station:

The TTC's ability to accommodate extremely large volumes of customers within a very short time period (defined here to be a constant, highly-concentrated level of demand over a 20-minute period of time, following which customer demand would gradually diminish) is governed by four major factors:

(a)the capacity of turnstiles, and stairs and escalators;

(b)the capacity or standing room available on the subway platform;

(c)the train capacity which can be operated through the station; and

(d)uncontrollable operational problems which can reduce the capacity of any of these components, but especially train capacity.

(i)Turnstiles, and Stairways and Escalators:

The existing collectors' booths and turnstiles at Union Station would be supplemented by customer service "crash" gates which would expedite fare collection. Collectively, with all collectors' booths, turnstiles, and supplemental crash gates in operation, the number of customers who could be served through these facilities would exceed the capacity of the stairways and escalators at UnionStation. There are four stairways and three escalators between the mezzanine level and the subway platform. With all three escalators operating down to the subway platform, and assuming a minimal volume of customers traveling in the opposing upward direction on stairways, it would be possible to have 600 customers per minute travel down to the subway platform level.

(ii)Subway Platform Capacity:

In very crowded conditions, such as would be expected to occur with customer demand from two concurrent stadium events, each customer would be able to occupy less platform space than would be the norm during, say, an afternoon peak period situation. In this crowded condition, each customer would occupy approximately 0.5 square metres of platform space and, assuming that customers are relatively well-distributed over the entire platform area, the current platform at UnionStation could theoretically accommodate approximately 1,400customers. This is shown in Exhibit1, in which each of the "dots" represents a person standing on the platform. If all stairways and escalator two leading to the platform were operating at capacity, the platform would become fully occupied within two minutes and 20seconds.

Union Station is the worst station in the TTC system for serving large volumes of customers. The platform at Union Station is very small and disjointed, and features very narrow spaces adjacent to stairways and escalators, and escalators which deliver customers to physically-constrained sections of the platform. The inefficient platform layout makes it difficult, even under moderately crowded conditions, for customers to move along the platform to try to fill up less crowded areas. Therefore, under heavy-demand conditions, crowding is likely to occur very quickly near stairways and escalators. This means that the practical capacity of the platform would be lower than the rated capacity mentioned above and shown in Exhibit 1.

(iii)Subway Train Capacity:

As discussed under the earlier section, entitled "Major Assumptions", the highest level of customer demand would be most likely to occur later in the evening on weekdays or Saturdays. After 9:30p.m. on weekdays, and after 9:50 p.m. on Saturdays, the scheduled interval between trains at Union Station, heading northbound via Yonge, is six minutes (effective September, 1997). This means that, over a 20-minute period, three subway trains would be scheduled to pass through UnionStation in each direction. In response to an expected very high level of customer demand, additional non-scheduled "standby" trains would be stored off the main line and held in readiness to go into service at the appropriate times to serve customers at Union Station. Including these extra "standby" trains, it would theoretically be possible to operate eight trains, in the peak direction, through Union Station over a 20-minute period. Each subway train can reasonably carry approximately 1,200customers, and each of the standby trains would arrive at Union Station with no customers on board; the regularly-scheduled trains would be assumed to arrive at Union Station with five percent of their capacity already occupied by customers.

Eight subway trains in the peak direction over a 20-minute time period would be equal to a train every 2 feet and 30 inches, on average. This is approximately the same interval between trains as is operated on the Yonge-University-Spadina Subway line during the AM peak period, and it is the practical limit of subway train capacity under the current physical configuration of the TTC's subway system. Current daily operating experience would indicate that this frequency of service is rarely sustainable, without an interruption or gap, over a significant period of time.

(iv)Uncontrollable Operating Problems:

Two operational problems, which cannot be easily controlled, could affect the capacity of the station and the volume of customers which could move through it:

(1)if an escalator were to break down, then the escalator's capacity would be reduced to that of an equivalent-width stairway. This would reduce the total stairway and escalator capacity, leading down to the subway platform, from 600 people per minute to 550 people per minute; and

(2)a subway train could be delayed or could experience a mechanical failure. A delay could occur reasonably easily, given that the operation of a train every 2 feet and 30 inches, on average, in the peak direction, would be done on a non-scheduled basis, requiring that trains be dispatched from special holding tracks at just the right moment, and slotted in-between the regularly-scheduled subway trains. A delay in subway service of as little as one minute, in a situation of continual heavy customer demand, would result in significant overcrowding on the subway platform, as customers would continue to arrive on the platform at a faster rate than train capacity could carry them out of the station. This is illustrated in Exhibit 2 which shows that, with virtually any delay or gap in the planned service level of 2 feet and 30 inches, the build-up of crowds on the platform would quickly exceed the capacity of the platform at Union Station.

This situation of platform overcrowding due to service delays would be especially bad at Union Station because the platform is in the centre, between the two tracks, and is, therefore, "shared" between customers heading in either direction. So, if a service delay were to occur in one direction, customers waiting to travel in that direction would quickly fill up the platform space, making it impossible for customers wishing to travel in the other direction to get onto the platform. A delay in one direction, then, would effectively block off customer travel in the other direction.

In the event of a mechanical failure of a train, with the possible consequence that one or more of the trains designated to serve the station during the peak 20-minute period would be unable to do so, there would be a significant loss of customer-carrying capacity, and customer demand at the station would exceed the train capacity during this period.

If either of these type of service incidents were to occur, the result would be a dangerous level of overcrowding on the subway platform.

Comparison of Customer Demand and Union Station Capacity:

The tables on the pages following Exhibit 2 compare the volume of customers which would be expected to use Union Station under different stadium event scenarios, and the capacity of different components of Union Station, in three cases:

(a)ideal operating conditions, where maximum train capacity over the 20-minute peak period is achieved;

(b)where a small operating problem occurs, such as a mechanical failure on one of the trains, resulting in the loss of one train's worth of capacity in the 20-minute peak period; and

(c)where a larger operating problem occurs, such as a mechanical failure on one of the trains which, in turn, blocks the two trains behind it, resulting in the loss of three train's worth of capacity in the 20-minute period.

Comparison of Union Station Capacity

and Customer Demand Generated by Stadium Events

Case A - Optimum Operating Conditions: Maximum Train Capacity

Scenario Projected

Event-Related Customer

Demand in

Peak 20 Minutes

Customer Capacity at Union Subway Station

in Peak 20 Minutes

Subway

Trains

To

University

To

Yonge

Total Via A

University

Via B

Yonge

Stairs and

Escalators

@ 600/min.

Station

Platform

Capacity

1 1,400 2,600 4,000 5,800 9,400 12,000
2 2,400 6,700 9,100 5,800 9,400 12,000 Capacity of 1,400 persons; fully occupied in two minutes

20 seconds.

3 3,050 8,350 11,400 5,800 9,400 12,000
4 3,600 9,900 13,500 5,800 9,400 12,000

Case B - Small Operating Problem: Loss of One Train's Capacity

Scenario Projected

Event-Related Customer

Demand in

Peak 20 Minutes

Customer Capacity at Union Subway Station

in Peak 20 Minutes

Subway

Trains

To

University

To

Yonge

Total Via A

University

Via C

Yonge

Stairs and

Escalators

@ 600/min.

Station

Platform

Capacity

1 1,400 2,600 4,000 5,800 8,200 12,000
2 2,400 6,700 9,100 5,800 8,200 12,000 Capacity of 1,400 persons; fully occupied in

two minutes

20 seconds.

3 3,050 8,350 11,400 5,800 8,200 12,000
4 3,600 9,900 13,500 5,800 8,200 12,000

Scenarios:

(1)20 percent of New Stadium customers use transit.

(2)13.6 percent of SkyDome, 20 percent of New Stadium customers use transit.

(3)17 percent of SkyDome, 25 percent of New Stadium customers use transit.(4)20 percent of Sky Dome, 30 percent of New Stadium customers use transit.

Train Capacity:

(A)Three scheduled trains plus two standby trains; arriving scheduled trains are fivepercent occupied.

(B)Three scheduled trains plus five standby trains; arriving scheduled trains are five percent occupied.

(C)Three scheduled trains plus four standby trains; arriving scheduled trains are five percent occupied.

(D)Three scheduled trains plus two standby trains; arriving scheduled trains are five percent occupied.

Station Capacity Exceeded. Potentially Unsafe Crowding Conditions.

Case C - Bigger Operating Problem: Loss of Three Trains' Capacity

Scenario Projected

Event-Related Customer

Demand in

Peak 20 Minutes

Customer Capacity at Union Subway Station

in Peak 20 Minutes

Subway

Trains

To

University

To

Yonge

Total Via A

University

Via D

Yonge

Stairs and

Escalators

@ 600/min.

Station

Platform

Capacity

1 1,400 2,600 4,000 5,800 5,800 12,000
2 2,400 6,700 9,100 5,800 5,800 12,000 Capacity of 1,400 persons; fully occupied in two minutes

20 seconds.

3 3,050 8,350 11,400 5,800 5,800 12,000
4 3,600 9,900 13,500 5,800 5,800 12,000

Scenarios:

(1)20 percent of New Stadium customers use transit.

(2)13.6 percent of SkyDome, 20 percent of New Stadium customers use transit.

(3)17 percent of SkyDome, 25 percent of New Stadium customers use transit.

(4)20 percent of Sky Dome, 30 percent of New Stadium customers use transit.

Train Capacity:

(A)Three scheduled trains plus two standby trains; arriving scheduled trains are five percent occupied.

(B)Three scheduled trains plus five standby trains; arriving scheduled trains are five percent occupied.

(C)Three scheduled trains plus four standby trains; arriving scheduled trains are five percent occupied.

(D)Three scheduled trains plus two standby trains; arriving scheduled trains are five percent occupied.

Station Capacity Exceeded. Potentially Unsafe Crowding Conditions.

The tables show that Union Station should be able to handle the customer demand which would be generated by a single event at New Stadium (Scenario 1).

If two major stadium events were held concurrently, the significant traffic congestion and the increased demand and cost for parking spaces would result in a higher transit market share, so Scenario 3 would be the most likely scenario in these tables. Under this scenario, if subway service were operating perfectly at maximum capacity, as in the "Case A" table, the capacity of Union Station would just match customer demand, even with the special supplemental measures mentioned earlier, including additional crash gates for fare collection, operating all escalators down to the subway platform level, and operation of additional standby trains up to the maximum capacity of the subway system. For this to work, all of these conditions would have to apply:

(a)customers arrive relatively consistently and evenly-distributed over the peak 20-minute time period;

(b)all components of Union Station (the turnstiles, gates, stairways, escalators, and platforms) are used to their maximum capacity which, in turn, is premised on customers distributing themselves relatively evenly over the length of the platform; and

(c)subway trains arrive evenly spaced over the 20-minute period, and there are no delays in service or other unforeseen problems.

However, realistically, it is unlikely that all of these conditions would apply simultaneously. The biggest risk would be the occurrence of a train-related problem, such as a delay or mechanical failure similar to what customers may experience during normal peak period travel on the TTC. In the second table, entitled "Case B", a very small operating problem is introduced into the picture: the loss of one train's worth of capacity during the peak 20 minutes. All numbers have been held constant in that table, except for the subway train capacity via the Yonge line, which has been reduced. As a result, in Scenario 3, the carrying capacity in the peak direction becomes less than the customer demand in that same direction, and this would lead to overcrowding on the subway platform.

In the "Case C" table, where a mechanically-disabled train blocks the following two trains from entering the station, the customer demand, under even the most modest of two-event demand assumptions (Scenario 2), significantly exceeds the train capacity which would be provided through the station. If the transit market share were larger than present (Scenario4 of Case C), the loss of service due to mechanical problems would result in the customer demand to travel north via the Yonge line being almost twice as large as the train capacity, and crowding on the platform would be at a dangerously high level.

Under conditions of a constant high volume of customers entering the station, if a service delay were to occur, it would be very difficult to slow down the flow of customers into the subway station. Given that the Union Station platform would fill up in just over two minutes, a delay of even one minute in the arrival of a subway train would cause the subway platform to be at almost 150 percent of capacity. The constrained and disjointed nature of this platform would make this level of platform occupancy a dangerous situation. The charts in Exhibit 3 show how even small delays to subway train service can quickly result in unsafe crowding conditions on the platform at Union Subway Station.

It is not known how often two stadium events would be held at the same time. This would depend on co-ordination between the different stadium operators regarding the scheduling of their events; however, even such co-ordination could be ineffective in achieving staggered adjournment times because the duration of sporting events, concerts, and other attractions are often unpredictable.

Conclusions:

Union Subway Station, which is the focal point for transit travel to/from the downtown stadium area, is the worst station in the TTC system for serving large volumes of customers because its platform is unusually small and disjointed, with very narrow spaces adjacent to stairways and escalators, escalators which deliver customers into very constrained areas, and passenger movement significantly limited by the presence of elevators, escalators, and stairways.

If a new stadium is built close to Union Subway Station, and that stadium and SkyDome hold high-attendance events which end at the same time, Union Station, under realistic operating conditions, would be unable to accommodate the volume of customers choosing to take transit. This would happen despite TTC measures to augment customer capacity through use of crash gates and additional standby trains. Any service, scheduled or supplementary, is subject to unpredictable and uncontrollable delays or problems; this is particularly true when operating trains only 2'30" apart.

Under conditions of a constant high volume of customers entering the station, even small delays tosubway train service can quickly result in unsafe crowding conditions on the platform at UnionSubwayStation.

If the TTC were serving the customer demand from two stadium events, and any service delays were to occur, then, under every tested volume of customer demand, demand would exceed station capacity, and overcrowding in the station would occur - at increasing levels of danger and risk to customers.

In the longer term, the configuration of Union Station would have to be improved. TTC staff have done some preliminary design work pertaining to the expansion of Union Station's mezzanine, and the construction of a new platform, south of the existing tracks, which would be dedicated for use by customers traveling north via the Yonge Subway line. This expansion has been estimated to cost $40million.

This report has been prepared based on a number of explicit assumptions. A more thorough analysis of possible stadium event scenarios and resulting customer demand at Union Station is required in order to determine what improvements to Union Station are necessary to ensure safe accommodation of the very high levels of customer demand associated with concurrent stadium events.

--------

(Communication dated March 31, 1998, from

Mr. Tom Anselmi, Vice-President and Project Director,

Maple Leaf Gardens, Limited)

I am in receipt of a copy of a letter to the City dated February 26, 1998, from the General Secretary of the Toronto Transit Commission, which attached TTC reports dated February 25, 1998, and May13, 1997, respectively.

The letter requests the City of Toronto to establish a mechanism for obtaining private sector funding for the expansion of Union Subway Station and, further, that Maple Leaf Gardens, Limited should be requested to make the initial contribution to the fund as a result of the proposed Air Canada Centre/Union Station development.

The attached TTC reports indicate the capacity/demand problem is a result of potential surge demand from two sports stadiums with coincident events and from the extensive developments planned for surrounding areas such as Harbourfront, the Railway Lands and Grand Adex. The May 13, 1997, report, however, was written on the basis of, and debated at a time when the Maple Leafs were considering a separate arena from the Air Canada Centre and concerns at that time were about a second downtown arena in addition to the SkyDome stadium. The May 25, 1997, report recommends that Maple Leaf Gardens, Limited should make the initial contribution because of a perceived increase in activity in Union Station as a result of the proposal to integrate the Air Canada Centre with Union Station; however, there is nothing to substantiate such an assumption.

If expansion to Union Subway Station is required in the future to accommodate further downtown development, this expansion should be financed through an increase to the TTC capital program, similar to the Scarborough RT and the North York City Centre Stations. We are of the opinion that public sector investment should be used to attract development as opposed to a new private sector "tax" which discourages it.

Notwithstanding the ultimate policy decision by the City, it is our position that the Air Canada Centre, the redevelopment of Union Station and/or the integration of the two projects is not responsible for the under-capacity of Union Subway Station in its larger context.

Our position is based on the following:

(1)the station was built approximately 40 years ago when downtown density was dramatically different;

(2)the Air Canada Centre already went through a rigorous approval process and was required to make significant infrastructure capital investments, all of which have been honoured. The expansion of Union Subway Station was not included at that time;

(3)capacity of the Air Canada Centre is 20,000 of which approximately 6,000 (30 percent) will arrive by transit. Most events are in the evening (7:00 p.m. to 7:30 p.m. start time and 10:00p.m. to 10:30 p.m. finish). These demands are significantly less, and at a different time, than peak rush hour demand;

(4)the SkyDome was not assessed a contribution to the expansion of Union Subway Station at the time of its development even though it is a significantly higher contributor (capacity50,000--modal split 40 percent) than an arena. The SkyDome development did, however, contribute extensively to other forms of infrastructure;

(5)a comparison of the 1998 Raptor and Leaf schedules with the SkyDome event schedule indicates little overlap, even without any co-ordination. By co-operating in the selection of start and finish times of coincident events, the risk of coincident events exiting at the same time can be essentially eliminated;

(6)a variety of crowd control measures an be implemented to reduce the impact in the unlikely event that events at the Air Canada Centre and the SkyDome exit at the same time; and

(7)the redevelopment of Union Station will not significantly increase activity at Union Station. Additional floor space will not be created and the impact of the redevelopment will be insignificant when compared to the proposed increases in capacity being suggested by GOTransit, and other transportation tenants at Union Station.

Accordingly, we respectfully advise that Maple Leaf Gardens, Limited is not prepared to consider contributing to the expansion of Union Subway Station.

--------

(Communication dated April 17, 1998, from the

Chief General Manager, Toronto Transit Commission)

Attached is an April 17, 1998 letter from myself to Mr. Tom Anselmi, Vice-President and Project Director of Maple Leaf Gardens, Limited. It is a response to Mr. Anselmi's letter which is listed as Item No. (1)(a) on the City Urban Environment and Development Committee meeting scheduled for Monday, April 20, 1998.

Please make arrangements for the attached letter to be considered at the same time the Committee addresses Item No. (1)(a).

--------

(Communication dated April 17, 1998, addressed to

Mr. Tom Anselmi, Vice-President and Project Director,

Maple Leaf Gardens, Limited, from the

Chief General Manager, Toronto Transit Commission)

Thank you for your letter of March 31, 1998, in which you state that Maple Leaf Gardens, Limited is not prepared to consider contributing financially to the expansion of Union Subway Station.

The decisions to locate the Air Canada Centre, SkyDome, and a host of other large developments near Union Station were clearly driven, to a large extent, by the superior accessibility provided to that area by the public transportation systems which operate out of Union Station. The Air Canada Centre location has been made more desirable, convenient, and valuable by the huge amounts of public money which have been invested over time developing high-quality transportation infrastructure there.

Union Subway Station, a critical part of that infrastructure, is now being outgrown by the increasing demands which are being placed on it by the intensification of development in the area. The subway station platform is already uncomfortably crowded during peak commuting hours and during heavily-attended events at SkyDome. The demand which will be placed on the station by the AirCanada Centre is one of the additional factors which will result in the station being inadequate to meet the transportation needs of the area over the coming years.

The Air Canada Centre, and the other major developments which were mentioned in the February25,1998, TTC report, will benefit significantly from the availability of high-capacity, high-quality transit service at Union Station. These beneficiaries, including Maple Leaf Gardens, Limited, should be prepared to contribute to the improvement of this station to ensure that the needs of your customers are met, as well as those of the visitors, shoppers, and commuters which will make your investment in Union Station more valuable.

The City of Toronto recently approved a development charges by-law which will apply a per-square-foot charge to developments within the zone of influence of North York Centre Subway Station and of stations along the new Sheppard Subway Line. This is intended to recapture the significant additional value which accrues to developments near subway stations. The strength of this argument is undeniable. It is on this basis that we have requested the City of Toronto Council to establish a special reserve fund for private-sector contributions towards the cost of expanding Union Subway Station. We intend to pursue this at City Council, and I urge you to reconsider your position regarding a contribution toward such a reserve fund, in light of the significant convenience and benefits which transit will bring to your customers and the significant value which transit adds to your investment.

(A copy of Exhibits 1, 2 and 3, referred to in the foregoing TTC Discussion Paper, entitled "TTC'sAbility to Serve Multiple Sports Stadiums at Union Station", is on file in the office of the City Clerk.)

3

Audit Services

(City Council on May 13 and 14, 1998, amended this Clause by adding thereto the following:

"It is further recommended that the City Auditor be requested to:

(1)submit a report to the Audit Committee on alternate work possibilities for affected Bargaining Unit staff; and

(2)submit a report to the next meeting of Council to be held on June 3 and 4, 1998, through the Audit Committee, on the efforts made to accommodate the 30 employees affected within the Corporation.")

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations of the Audit Committee embodied in the following transmittal letter (April22, 1998) from the Audit Committee:

Recommendation:

The Audit Committee again recommends that:

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

(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.

At its meeting held on April 21, 1998, the Audit Committee had before it a communication (April21, 1998) from the City Clerk advising that at its meeting held on April 16, 1998, City Council:

(A)had before it Clause 10 of Report No. 4 of the Strategic Policies and Priorities Committee, headed "Audit Services";

(B)had struck out the aforementioned Clause; and

(C)had referred the Clause back to the Audit Committee for further consideration.

The Audit Committee recommends the adoption of its previous recommendation as set out in Clause No. 10 of Report No. 4 of The Strategic Policies and Priorities Committee.

--------

(Communication dated April 21, 1998, addressed to

the Audit Committee from the City Clerk)

City Council, at its meeting held on April 16, 1998, had before it Clause No. 10 of Report No. 4 of the Strategic Policies and Priorities Committee, headed "Audit Services".

Council directed that the aforementioned Clause be struck out and referred to the Audit Committee for further consideration.

--------

(Clause No. 10 of Report No. 4 of the Strategic Policies

and Priorities Committee headed, "Audit Services")

The Strategic Policies and Priorities Committee recommends the adoption of the recommendation of the Audit Committee embodied in the transmittal letter (March25, 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;

(c)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 ReportApril 15

Issue of Request for ProposalApril 20

Response to Request for ProposalMay 1

Selection of Attest AuditorsMay 15

Council Approval of Attest AuditorsJune 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).

--------

(Communication dated May 1, 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. As directed by both the Audit and Strategic Policies and Priorities Committee, we have met with the City Auditor and would like to share our concerns with Committee members.

The City Auditor has stated that he is not contracting-out the attest audit to save money. CUPE Local 79 believes that this is probably true. Given the extent of the work to be done and the lack of any precise figures on its cost, there is little doubt that the private firms will end up charging far more than the $1.75 million which has been budgeted.

The City Auditor says that the key issue is the independence of the auditor. He says that bond rating agencies have raised this matter. We have stressed that these queries have had no impact the same bond agencies continue to give the City excellent ratings.

The City Auditor says that the proposed new Municipal Act recommends that the auditor of a municipality shall not be an employee of the municipality. In our view, the recommendation does not mean that the attest audit has to be contracted-out. The auditor could hold an independent office and still have staff do the work. This is because the terms of the office guarantee independence. There are many examples. Judges are independent of the Attorney General's Office and yet their staff working in the courts are provincial employees.

It is important to note that the Act is still in draft form; it was not mentioned in the recent Throne Speech and many believe that it will not be passed.

The City Auditor is reporting at a later date on the new structure of the Audit Department. It makes no sense to decide upon a structure after you have deleted thirty people's jobs and lost their collective expertise. After contracting-out, more highly paid managers will be performing the internal audit work. At a time when the City is decreasing the number of managerial staff, there will be not front-line workers in this department.

The remaining work of carrying out internal audits is more important than ever. The extent and adequacy of management and procedural controls throughout the City are still unknown. There are seven separate systems in place and no uniform standards. Front-line staff, with the knowledge and experience gained from working in the municipal area, should be provided the training to do this essential work.

Union members have been carrying out audit work for over fifty years and there has never been a question of the department's integrity or independence. CUPE Local 79 urges members of the Committee to reject recommendations to contract-out the attest audit function.

(City Council on May 13 and 14, 1998, had before it, during consideration of the foregoing Clause, the following communication (April 15, 1998) addressed to Councillor David Miller from the City Auditor:

Thank you for your letter dated April 14, 1998. I appreciate the opportunity to respond to your concerns prior to the Council meeting of May 13, 1998.

I apologize for the length of my response which is necessitated by the complexity of the issue. Prior to answering each of your questions, I'd like to provide you with the following background information.

The reasons for contracting out the attest audit function was not based on the premise that to do so would reduce audit costs. The question of contracting out at both the former City of Toronto and the former Metropolitan Toronto has been an issue which has surfaced from time to time over the years. It should be noted that the attest audit of the other amalgamating municipalities has always been contracted out.

The contracting out of the external audit function at the new City of Toronto was based on two major factors:

(a)Audit Independence; and

(b)the difficulties in staffing the new City Audit Department to meet provincially imposed reporting deadlines.

(a)Audit Independence:

The question of audit independence has been an issue raised in the past by the bond rating agencies in terms of an employee providing an audit opinion on his employer's financial statements. This situation to the best of my knowledge exists in only one other municipality in North America (City of Montreal). In the private sector, this situation, again to the best of my knowledge, does not exist.

The Province has appeared to address this issue in the proposed new Municipal Act. In section 270 relating to the appointment of an attest auditor, the proposed Act specifically states that "Despite any Act, the auditor of a municipality shall not be an employee of the municipality or of a local board of the municipality." The eventual passing of this new Municipal Act would legislate the contracting out of the attest audit.

(b)The difficulties in staffing the new City Audit Department to meet Provincially imposed reporting deadlines:

Attest audit opinions on all municipal financial statements in Ontario are required by April 30 each year. The preparation of financial statements as soon as possible after the year end is important. The Public Sector Accounting and Auditing Board (PSAAB) of the Canadian Institute of Chartered Accountants in its pronouncements 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. At the former Metro Toronto and the former City of Toronto, difficulties have been encountered in meeting these deadlines. At Metro for instance, even though consolidated financial statements have been issued by April 30, a number of the financial statements from local boards, agencies and commissions have been delayed beyond this date. In the case of the City of Toronto, this delay has over the years been significantly longer.

If the Department was to staff to a level to meet these deadlines, excess staff would be available subsequent to April 30. These staff would generally be "clerical attest" auditors with skill sets in this function only. The type of work contemplated for the new Audit Department would not require such skill sets.

Having provided you with the above background information, the answers to your specific questions are as follows:

(1)Due to the above factors, there was never an attempt made to justify the retention in-house of the "external" audit from a cost/benefit perspective. This issue was discussed with both the Chief Administrative Officer and the Chief Financial Officer and Treasurer. From a practical perspective, due to both the independence issue, as well as the staffing issue, the retention of the external audit was not considered a viable alternative and consequently, no cost-benefit analyses were conducted.

(2)In 1997, the total in-house costs relating to the audits of the former City of Toronto and the former Municipality of Metropolitan Toronto were $3,502,000.00 on a gross basis and $2,310,000.00 on a net basis after billings to certain local boards, agencies and commissions. The recoveries of $1,192,000.00 are accounted for as an expense in the budgets of the respective local boards, agencies and commissions and are shown as a recovery in the budgets of the Audit Departments. On a total basis, the costs to conduct the audits of the former City of Toronto and the Municipality of Metropolitan Toronto were therefore $3,502,000.00.

It is difficult to compare 1997 costs to the Department's proposed 1998 budgets due to the fact that included in 1998 are salary costs relating to the 1997 attest audits presently being conducted by my staff and staff of the former City of Toronto. In this context, it is more meaningful to compare 1997 costs to a proposed budget for 1999 when certain transition costs no longer exist. This comparison is as follows:

1997 CostsInternalExternalTotal

Metropolitan Toronto2,300,000115,0002,415,000

City of Toronto1,202,000150,0001,352,000

City of North York - 153,000 153,000

City of Scarborough 408,000 87,000 495,000

City of Etobicoke - 95,000 195,000

City of York - 79,000 79,000

Borough of East York - 61,000 61,000

3,910,000 840,0004,750,000

Anticipated 1999 Costs

City of Toronto1,747,0001,750,000 3,497,000

The amount of $1,750,000.00 included in the anticipated 1999 costs is an estimate of the external audit costs for the new City of Toronto and its local boards, agencies and commissions. This estimate is derived from my experience in the private sector, my current knowledge of the public accounting profession, as well as comparisons to other municipal organizations. I have discussed this estimate with the Chief Financial Officer and Treasurer, who has similar private sector experience. She concurs that this is a reasonable estimate. Obviously, the only way we will be able to firm up this figure is by issuing a proposal call.

(3)I am attempting to locate audit costs for Air Canada, Canadian Airlines and Canada Trust. Even though the financial statements of each of the above are available to the public, the information contained in the financial statements is not detailed enough to provide information relating to audit costs. Nevertheless, I will attempt to locate this information as quickly as possible.

It should, however, be noted that the comparison of audit costs between various entities is difficult even though entities may be of similar size. Audit costs depend on a number of issues such as:

-number of locations;

-complexity of operations;

-adequacy of administrative controls;

-number of audit opinions required; and

-the assistance provided by an internal audit function.

In my private sector experience, I have encountered many situations where relatively small corporations incurred much higher audit costs than larger corporations.

(4)The 1997 external costs for the City of Toronto and Metropolitan Toronto represent fees paid to public accounting firms engaged in joint audits with the audit departments of the City and Metro. In the case of the City, the joint audit arrangement related to Toronto Hydro and in the case of Metro, represented similar arrangements with the Toronto Transit Commission.

In the case of the TTC, the issue as to why such an arrangement existed was the subject of a report by the TTC a year or so ago. The Commission accepted staff's recommendation that the hiring of an external auditor, working jointly with the Metro Auditor had a number of advantages even though this was not the most efficient arrangement.

I hope I have answered your questions to your satisfaction. Again, I would be pleased to discuss this issue with you at your convenience.)

(City Council also had before it, during consideration of the foregoing Clause, communications from the following individuals, urging Members of Council to reject the recommendation to contract-out the attest audit function:

(i)(May12, 1998) from Mr. Sid Ryan, President, and Mr. Brian O'Keefe, Secretary-Treasurer, Ontario Division, Canadian Union of Public Employees (CUPE); and

(ii)(May 11, 1998) from Mr. D. Casey, Acting President, CUPE Local 79.)

(City Council also had before it, during consideration of the foregoing Clause, a communication (May4, 1998) from Councillor Kyle Rae, Downtown, submitting correspondence dated April 30, 1998, from Ms. Rosie Schwartz, Toronto, suggesting that an in-house audit department cannot be independent of political pressures.)

4

Committee on the Status of Women

(City Council on May 13 and 14, 1998, adopted this Clause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (April 6, 1998) from the Chair of the Committee on the Status of Women:

Recommendations:

(1)that the Committee on the Status of Women's participation at the annual general meeting of the National Action Committee on the Status of Women be confirmed as outlined in the report (April 6, 1998) from the Committee of Women's meeting of March 26, 1998; and

(2)that City officials be authorized to take appropriate action to give effect to the foregoing.

Comments:

At its meeting on March 26, 1998, the Committee on the Status of Women decided to continue its participation in the annual general meeting of the National Action Committee on the Status of Women which will be held in Ottawa from June 5th to 7th, 1998. The Committee also requested that two representatives attend the conference.

Participation in this conference will provide the Committee with an opportunity for information exchange with other women's organizations working on similar issues across Canada. Participation will also enhance the advisory role which the Committee provides to Council.

Transportation and accommodation costs are estimated at $900.00. Provision for the Committee's participation was provided in Account 10-350 of the Equal Opportunity Section, Human Resources Division.

5

New Logo for the City of Toronto

(City Council on May 13 and 14, 1998, amended this Clause by adding thereto the following:

"It is further recommended that:

(1)the Chief Administrative Officer be requested to develop a marketing strategy, such strategy to include the development of appropriate products (e.g. pens, cups, ties, pins, etc.) using the new City of Toronto logo;

(2)the City Solicitor be requested to take the appropriate action to register the Design Proposal as an official mark of the City of Toronto under the Trade Marks Act , and the City Clerk be authorized to expend the necessary funds required for such registration; and

(3)the appropriate City officials be authorized and directed to take the necessary action to give effect thereto, including the execution of any required documentation.")

The Strategic Policies and Priorities Committee recommends that:

(1)Design Proposal "C" be selected as the Logo of the new City of Toronto; and

(2)City staff look at the possibility of a clearer definition of the "T" in Design Proposal "C".

The Strategic Policies and Priorities Committee submits the following report (April 24, 1998) from the Chief Administrative Officer:

Purpose:

To propose the adoption of a new logo for the City of Toronto.

Financial Implications:

The new logo will be applied upon the consumption of existing supplies and acquisition or replacement of existing equipment. No extraordinary costs will be incurred.

Recommendations:

That the Strategic Policies and Priorities Committee recommend one of the three proposed logos to City Council.

Background:

In 1997 a word mark was developed for the use of the Transition Team and the new City, until a final logo proposal could be considered. This is the word mark in current use. Since the fall of 1997, there has been an extensive process of consultation with citizens (through two focus groups), design professionals external to the City, the Chairs of the Community Councils and the Mayor, to develop three proposals for City Council's consideration.

Comments:

Through this process of selection of designs for consideration, the creative design staff of the former municipalities developed approximately sixty designs. Two of the proposed designs are new and the third is essentially the logo of the former City of Toronto, with minor modification. The latter design is included since there has been expressed opinion that it is an effective, modern logo.

All three logos include a representation of the City Hall. Other designs that did not include City Hall were considered. It is the conclusion of those reviewing the designs, that given City Council's decision regarding the location of the seat of government and the recognized symbolism of the building, its inclusion in the final design is desirable.

The adoption of a logo for a municipality is a complex matter. Not only must a logo work in a variety of media and situations, is also part of a much larger strategy for corporate recognition through a visual identity program carried throughout the whole organization. Other logos may be developed as a sub-set of the corporate logo for use in particular programs, strategies, or for other purposes, but they should form part of an integrated visual identity program. To this end, staff will bring back to City Council a Visual Identity Program which will establish policy for the use of the City's new corporate symbols.

Conclusion:

Each of the logos presented for consideration and selection portray the City as a modern, progressive city, and any selection will effectively function well in a Visual Identity Program.

Contact Name:

Doug Reid, 392-8937 or Syd Baxter, 392-3769.

Insert Table/Map No. 1

new logo for the city of toronto

Insert Table/Map No. 2

new logo for the city of toronto

Insert Table/Map No. 3

new logo for the city of toronto

(City Council on May 13 and 14, 1998, had before it, during consideration of the foregoing Clause, a communication (May 12, 1998) from Councillor Chris Korwin-Kuczynski, High Park, forwarding some of the many submissions he received during a design competition he held respecting the logo for the new City of Toronto.)

6

Corporate Management Framework

(City Council on May 13 and 14, 1998, amended this Clause by inserting in Recommendation No.(4) embodied in the report dated April 27, 1998, from the Chief Administrative Officer, after the words "Chief Financial Officer and Treasurer", the words "to the Budget Committee", so that such recommendation shall now read as follows:

"(4)the Chief Administrative Officer, in conjunction with the Chief Financial Officer and Treasurer, report to the Budget Committee on a revised budget submission format and review process;".)

The Strategic Policies and Priorities Committee recommends the adoption of the following report (April 27, 1998) from the Chief Administrative Officer:

Purpose:

This report outlines a framework for corporate management plans and introduces the new management processes to be developed.

Financial Implications:

There are no financial implications related to the recommendations in this report.

Recommendations:

It is recommended that:

(1)the corporate management framework outlined in this report be approved;

(2)the Chief Administrative Officer report to the Strategic Policies and Priorities Committee on terms of reference for a strategic planning process, including Council member involvement and coordination with other major corporate planning initiatives;

(3)the Chief Administrative Officer report on multi-year program planning;

(4)the Chief Administrative Officer in conjunction with the Chief Financial Officer report on a revised budget submission format and review process; and

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

Background:

Many sound management practices were in place in the seven former municipalities; however, many of these approaches and systems are not compatible and the new City is now faced with a patchwork of management tools. Managers need the right tools to carry out their responsibilities in an effective and accountable manner, and Council needs assurance that the appropriate systems and processes are in place.

To achieve consistent management practices across the corporation, common management planning and control processes are required. A framework has been developed to provide a context for the design and development of several related management processes, as outlined below.

Corporate Management Framework:

Management processes are established at various levels of the organization to meet different corporate and program management objectives. A hierarchy of management processes will be developed, and will involve input from the departments and key corporate functions. From the broadest to the most specific, these processes include:

(i)strategic planning and a vision for the City;

(ii)multi-year program plans with a focus on core programs;

(iii)annual operating plans and budgets; and

(iv)individual performance and accountability.

A number of elements, while not new management concepts, will receive increased emphasis within the corporation's management processes. These elements include: a service recipient focus, outcome-based performance indicators and measures, continuous improvement, and accountability. These elements are generally applicable to all management processes at all levels of the organization.

Components of the Framework:

(1)Strategic Plan for the City:

Recommendation 1 of the Transition Team's final report proposed that the new City Council should consult with citizens and staff on a mission statement. Mission and vision statements are normally formulated through a strategic planning process. Strategic plans identify a preferred future state, establishing a shared vision and setting direction. They are normally visionary and long term in nature, covering a 10-25 year time horizon. The process for developing a strategic plan is as important as the resulting product, and involves broad community and stakeholder input and consultation.

The strategic plan for the City of Toronto will function as the overall plan for the future of the City, both for the corporation and for the community that it serves, providing the policy infrastructure for city-building. It guides service delivery and informs other planning processes and priority-setting initiatives. To serve as an effective management tool, the strategic plan also includes high-level indicators of success (e.g., quality of life indicators and general targets regarding population, the economy or service priorities). This permits monitoring of the level of success achieved in implementing the plan.

Development of the strategic plan itself will occur through a Council-driven process, and the commitment of Councillors will be important to its success. The strategic plan provides a vision of the future of the City, but it will also allow members of Council to look back at what they have accomplished over each term of Council.

This will be a significant undertaking for the City, and clear terms of reference are essential. The CAO will consult interested members of Council in developing the terms of reference for the strategic plan. Senior staff will also be involved in the development of the terms of reference.

Other plans of a strategic nature may also be prepared for policy fields or for cross-corporate matters. Such plans are closely related to the City's strategic plan and may be considered companion documents. Examples include the social plan and the development of environmental strategies. These plans need to be coordinated and integrated with the City's strategic plan. A report on the terms of reference for the strategic planning process will be submitted to the Strategic Policies and Priorities Committee in the near future, and will also address this matter.

(2)Multi-year Program Plans

Multi-year program plans will have a medium-term outlook, with a 3 to 5 or even 10 year horizon depending on the rate of change in the operating environment and the nature of the capital program. Program plans set priorities, define roles and identify how programs implement the strategic plan. Each plan defines units of service, establishes relevant performance measures, identifies targets for service levels, sets objectives regarding service improvements, and broadly identifies anticipated resource and capital investment requirements and timeframes. The focus is on service accomplishments in terms of results or outcomes rather than inputs consumed or products generated. The applicability of alternate service delivery methods would also be reviewed within the context of the program planning process.

Many of the City's programs and functions had developed plans in the past, some of which were of a one-off nature while others formed part of a recurring planning process. These program plans were often developed for different purposes, with variations in approach and scope ranging from setting goals or clarifying roles to forecasting demand or identifying appropriate service delivery strategies.

While these planning efforts are all valid, a more structured approach is necessary in order for program planning to form an effective component of the corporate management framework. Therefore, in addition to addressing relevant operational issues, future program plans will also have to satisfy traditional "business planning" requirements. The CAO will develop and report on a corporate process and specific requirements for multi-year program planning.

(3)Annual Operating Plans and Budgets

All services prepare annual operating budgets, a requirement to secure funds to cover operating expenditures. Different budget presentation formats, contents and processes were in place in the seven former municipalities and an interim process was put in place to facilitate the development of the City's first budget for 1998. It is desirable to re-examine appropriate budget process and submission requirements, within the context of the corporate management framework as well as existing and future financial systems and information management processes.

Operating plans and budgets will be prepared annually, covering the up-coming fiscal year plus a further one-year outlook or forecast, and will be a requirement for all programs and functions. This is a key step in operationalizing aspects of the multi-year program plans and identifying short-term operating strategies. Operating plans and budgets will establish annual objectives, propose service levels for the coming year and outline planned service improvements. They will also address program performance for the previous fiscal year and identify anticipated program performance in the coming year in relation to indicators and measures defined in the multi-year program plans.

The CAO in conjunction with the Chief Financial Officer will develop and report on revised requirements for operating plan and budget submissions. A review of Council's budget-setting process will also be included in the report with recommendations for a 1999 process.

(4)Performance Development and Appraisal

The first three components of the corporate management framework were concerned with the direction and the performance of the organization and its core programs. Development and appraisal of individual performance is another, more specific, management process.

Staff responsibilities should flow from program plans. Just as operating plans and budgets operationalize multi-year program plans, mechanisms are required to allocate objectives for program deliverables to employees. Objectives, workplans and performance contracts may be used to translate annual operating plans and budgets into responsibilities at the staff level. Performance development and appraisal, in turn, provides a process to hold employees accountable for their performance. Performance development and appraisal will encompass a number of relevant employee skills and competencies.

Conclusions:

To ensure that the corporation functions as a well-performing organization, a corporate management framework is being established. The framework includes four key management processes which are being developed: a strategic planning process, multi-year program plans, annual operating plans and budgets, and an employee performance development and appraisal process. The CAO will be reporting further on these individual management processes as appropriate.

7

Millennium Celebrations and Establishment of a Task Force

(City Council on May 13 and 14, 1998, amended this Clause by adding thereto the following:

"It is further recommended that Councillors Ashton and Korwin-Kuczynski be advised of Councillor Kinahan's interest in serving on the Millennium Task Force.")

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations in the following report (April 21, 1998) from Councillors Ashton and Korwin-Kuczynski:

Purpose:

This report outlines the need and a process for the City of Toronto to begin preparations for events for the year 2000. This report addresses primarily the process for developing and co-ordinating the events anticipated to take place throughout the year. The 1999 New Year's Eve event itself will be organized separately and outlined in a later report.

Funding Sources, Financial Implications, and Impact Statement:

The City will operate its millennium activities principally with internal seconded staff, but anticipates that it will rely on some contracted services to assist in the year 2000 activities. Authority is requested to expend up to $50,000.00 over the period May-August, 1998, for services relating to the design and co-ordination for the year-long celebrations. Costs and sponsorships for the New Year's Eve event will be estimated by the Special Events Group, and a proposal for that event will be forthcoming in a report in September, 1998.

Recommendations:

It is recommended that:

(1)a Millennium Task Force be struck to plan Toronto's role in the year long activities for the Year 2000, with representation from Council and relevant operating departments, with project management and staff support being seconded from within the City;

(2)the City provide an office and secretarial support to the Task Force until September 1, 1998, at which time the role and activities of the Task Force will be re-evaluated. The City also approve an allocation to the Task Force of $50,000.00 for operating costs and any contracted services over the period ending September 1, 1998;

(3) any Task Force expenditures for outside services be secured by a contract or Memorandum of Understanding for the services to be supplied, accompanied by a set of specific deliverables; and

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

Discussion:

Virtually all major cities in the world are considering plans for the year 2000. Cities and populated areas will be the focus for many of the activities and events surrounding the celebrations. At the very least, cities will need to be aware of the many activities and plans, so that they can co-ordinate emergency services, street closures, etc. Most cities also feel a responsibility to encourage high quality in the many celebrations that will occur throughout the year, as well as to help plan events and disseminate information.

It is therefore important that Toronto establish a process whereby interested groups within the community can:

(i)access information about how to plan their events;

(ii)obtain information about other millennium events; and

(iii)find out about publicizing their events.

In this respect, a City of Toronto Millennium Task Force should be established to undertake the planning for this process. This Task Force should have representation from Council, and from relevant departments to include Special Events, Economic Development, Parks and Recreation, Culture, and Community Services. Other departments will clearly need to be consulted, including Police and Emergency Services, and Transportation.

A number of other groups and initiatives relating to planning and celebrating the year 2000 already exist. One of these is 'Toronto 2000' which has representation on its Board from such critical groups as Tourism Toronto, the Board of Trade, and the Toronto Hotel Association. It may be appropriate for the City to contract certain services from such groups, who can help access sponsorships and mobilize community groups.

There is a need to begin work quickly as a number of ideas and events are already being planned by outside groups. It is therefore desirable to be able to commit some resources right away to help support the activities of the Task Force. Exact requirements by the Task Force are uncertain at this time, but operating costs and contracts may approach $50,000.00 over the period ending September1, 1998.

Any financial agreements between the City as represented by the Millennium Task Force and outside agencies or firms will be accompanied by a contract or Memorandum of Understanding (MOU) with specific deliverables attached.

Conclusion:

The City must begin work very soon if it is to provide an effective co-ordinating role with the many community groups that wish to plan events for the year 2000. The Special Events Office has already begun proposals and strategies for the official City of Toronto Millennium celebrations for New Year's Eve 1999, and will be reporting to Council for an endorsement of this activity in September, 1998.

It is therefore recommended that the City immediately appoint a Task Force with the representation as proposed earlier to deal with the year-long events. Members of the Task Force will be selected by Councillors Ashton and Korwin-Kuczynski, and the Mayor's Office. One of the Task Force's first activities will be to determine what it can best deal with in the short term, and what activities are more effectively undertaken by outside groups.

We therefore recommend that the City allocate up to $50,000.00 to support the work of the Millennium Task Force until September, 1998. The Task Force will determine what expenditure on outside expertise is appropriate, up to the level indicated, and the specific deliverables that it expects, secured by a contract or MOU. We also recommend that the City provide an office and secondments for project management and secretarial support to the Task Force.

Contact Name:

Philip Fontaine, Economic Development, 392-3378.

Jaye Robinson, Special Events, 395-7310.

8

Solid Waste Management Fees

(City Council on May 13 and 14, 1998, amended this Clause by:

(1)deleting from Recommendation No. (1) embodied in the report dated April 6, 1998, from the Interim Functional Lead, Solid Waste Management, the figure "$53.59" and inserting in lieu thereof the figure "$55.00", so that such recommendation shall now read as follows:

"(1)the solid waste management fee at the Keele Valley landfill be increased to $55.00 per tonne effective November 1, 1998;"; and

(2)adding thereto the following:

"It is further recommended that the Commissioner of Works and Emergency Services be requested to advise the private sector that further changes will be recommended by the Works and Utilities Committee, following submission of a report by the Commissioner of Works and Emergency Services on waste disposal options.")

The Strategic Policies and Priorities Committee again recommends the adoption of the report (April 6, 1998) embodied in Clause No. 16 of Report No. 4 of The Strategic Policies and Priorities Committee, from the Interim Functional Lead for Solid Waste Management.

The Strategic Policies and Priorities Committee submits the following communication (April30, 1998) from Councillor Disero:

The members of the Works and Utilities Committee, at a strategy session held on April 27, to discuss waste management matters, considered the issue of solid waster management fees, which was before City Council at its meeting on April 16, 1998, contained in Clause No. 16 of Report No. 4 of the Strategic Policies and Priorities Committee, and which was referred back to the Works and Utilities Committee for further consideration.

In order for this matter to be considered by Council as expeditiously as possible, it is requested that this matter be placed on the agenda for the meeting of the Strategic and Policies and Priorities Committee of May 5, 1998.

--------

(Communication dated April 21, 1998, addressed to the

Works and Utilities Committee, from the City Clerk)

City Council, at its meeting held April 16, 1998, had before it Clause 16 of Report No. 4 of The Strategic Policies and Priorities Committee, head "Solid Waste Management Fees".

Council directed that the aforementioned Clause be struck out and referred back to the Works and Utilities Committee for further consideration.

--------

(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 (April6,1998) 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.

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 (March25, 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.

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(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 TheFinancial 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 $1.2million 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.

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The Strategic Policies and Priorities Committee also had before it a communication dated April6,1998, 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.

9

Toronto Heritage Fund Grant Application -

45 South Drive

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (May 4, 1998) from the Municipal Grants Review Committee:

Recommendation:

The Municipal Grants Review Committee on May 4, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the attached report (March 31, 1998) from the Managing Director, Toronto Historical Board, respecting the Toronto Heritage Fund Grant Application for 45South Drive.

The Municipal Grants Review Committee reports, for the information of the Strategic Policies and Priorities Committee, having requested the Managing Director of the Toronto Historical Board to report to the Municipal Grants Review Committee:

(a)on the scope of the Toronto Heritage Fund grants program;

(b)providing a list of those who have received grants under this program, including commitments of all previously approved funds and whether such funds were spent; and

(c)on the public's knowledge of the program.

--------

(Communication dated April 23, 1998, addressed to the

Municipal Grants Review Committee from the City Clerk)

Recommendation:

The Community and Neighbourhood Services Committee on April 23, 1998, referred to the Municipal Grants Review Committee the attached report dated March 31, 1998, from the Acting Managing Director, Heritage Toronto, respecting the Toronto Heritage Fund Grant Application for 45 South Drive.

--------

(Report dated March 31, 1998, addressed to the

Community and Neighbourhood Services Committee from the

Managing Director, Toronto Historical Board)

Purpose:

To assist the owner to complete necessary restoration to the exterior of this designated property with a grant from the Toronto Heritage Fund.

Funding Sources, Financial Implications and Impact Statement:

Funds are provided through the Toronto Heritage Fund.

Recommendations:

It is recommended that:

(1)the Toronto Heritage Fund Application for 45 South Drive for a matching sum of up to $5,000.00 be approved;

(2)the grant be conditional on the owner entering into a Restoration Grant agreement prepared by the City Legal Department in consultation with the Managing Director, Toronto Historical Board; and

(3)the owner ensure that the Board's support for the project is suitably recognized.

Background:

This property is designated under Part IV of the Ontario Heritage Act by By-law No. 547-86, adopted by Toronto City Council on August 11, 1986.

On September 18, 1997, Ms. Louise Mac Donald, Mac Donald Design Build Inc., acting for the owner of the property located at 45 South Drive, applied for a Toronto Heritage Fund grant for the restoration of the exterior of the building.

Comments:

The proposed work consists of cleaning and restoring exterior brick; restoration of the front door, including hardware and the door surround; and installing new copper eaves-troughs and down spouts. The estimated cost for the work is $20,000.00.

Staff considers the proposed work necessary for the continued preservation of the property.

Contact Name:

Marisa Williams, Toronto Historical Board, Telephone: (416) 392-6827, ext. 240,

Fax: (416) 392-6834.

10

Toronto Heritage Fund Grant Application -

427 Bloor Street West (Trinity St. Paul's Church)

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (May 4, 1998) from the Municipal Grants Review Committee:

Recommendation:

The Municipal Grants Review Committee on May 4, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the attached report (April 24, 1998) from the Managing Director, Toronto Historical Board, respecting the Toronto Heritage Fund Grant Application for 427Bloor Street West (Trinity St. Paul's Church).

--------

(Report dated April 24, 1998, addressed to the

Municipal Grants Review Committee from the

Managing Director, Toronto Historical Board)

Purpose:

To assist the owner to complete necessary restoration of the north-east tower roof with a grant from the Toronto Heritage Fund.

Funding Sources, Financial Implications and Impact Statement:

Funds are provided through the Toronto Heritage Fund.

Recommendations:

It is recommended that:

(1)the Toronto Heritage Fund Application for 427 Bloor Street West (Trinity St. Paul Church) for a sum of up to $35,000.00 to support restoration of the north-east tower roof be approved;

(2)the grant be conditional on the Board of Trustees entering into a Restoration Grant Agreement prepared by the City Legal Department in consultation with the Managing Director of the Toronto Historical Board; and

(3)the Trustees ensure that the Board's involvement in the project is suitably recognized.

Background:

This property is designated under Part IV of the Ontario Heritage Act by By-law No. 166-80, passed by City Council on February 4, 1980.

On February 6, 1998, William W. Small, Chair, Board of Trustees, Trinity St. Paul's United Church, wrote requesting a grant from the Toronto Heritage Fund to cover costs for (1) re-roofing both towers with red clay tile masonry, (2) new gutters and down spouts, (3) masonry repointing on both towers, and (4) repair of decorative woodwork at a total cost of $135,000.00.

At its meeting of April 22, 1998, the Toronto Historical Board adopted the staff recommendation that this property receive support from the Toronto Heritage Fund.

Comments:

The Church's Board of Trustees is undertaking a five-year restoration and renovation program. The work is being funded through a capital fund raising campaign, with pledges paid over five years. Because the funding will be spread out, the work has been carried out in phases. Five phases have been identified. In 1996-1997, Phases I and II were completed with the support of Toronto Heritage Fund grants of $7,000.00 and $25,000.00, respectively. The church entered into a Heritage Easement Agreement with the City of Toronto last year.

This application is for Phase III and is a request for a Toronto Heritage Fund grant of $35,000.00. The scope of work proposed by the architect is as follows:

The work will entail re-roofing both tower roofs with red clay tile and shaped metal hip detailing to match the roof over the centre entrance. We will request an alternate price for the use of red slate on both roofs, red slate likely being more historically accurate, but our estimating research so far suggests that that the cost of slate will be beyond the budget. The roof work will also include new gutters and down pipes, or in the case of the north-east tower, spigots. In addition, we propose that complete repointing of the masonry take place on the east face of the south-east tower as it is exhibiting deterioration. As well, the upper area, all four sides, of the north-east tower will be repointed, as will the stones at the sides of the entry steps. Finally, the work will include making good any deteriorated woodwork, including the south-east entry doors, and refinishing the same. There is to be a moderate bit of glazing work to be carried out on both towers.

The Toronto Historical Board views the work as necessary to ensure the continued preservation of the building. Staff recommends that continued support is warranted given the site's high visibility and diverse community programing.

However, we are concerned that the proposal states that the original red slate of the south-east and north-east towers is to be replaced with clay tile. The architect's objective is to create a uniform roof. We recommend the conservation and repair of the existing red slate roof or replacement in kind and that the issuance of the grant be conditional on this.

The grant therefore would help make good the existing roofing on the north-east tower. We understand that the cost of replacing the roof in red slate exceeds $70,000.00.

Staff recommends that a grant of $35,000.00 support the restoration of the significant architectural feature of the red slate roofing at the north-east tower.

Contact Name:

Winston Bridgman, Toronto Historical Board, Tel: (416) 392-6827, ext. 238/Fax: (416) 392-6834.

11

Toronto Heritage Fund Grant Application -

49 Wellington Street East (Flatiron Building)

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (May 4, 1998) from the Municipal Grants Review Committee:

Recommendation:

The Municipal Grants Review Committee on May 4, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the attached report (April 24, 1998) from the Managing Director, Toronto Historical Board, respecting the Toronto Heritage Fund Grant Application for 49Wellington Street East (Flatiron Building).

--------

(Report dated April 24, 1998, addressed to the

Municipal Grants Review Committee from the

Managing Director, Toronto Historical Board)

Purpose:

To assist the owner to complete necessary restoration as part of a four year phased restoration project.

Funding Sources, Financial Implications and Impact Statement:

Funds are provided through the Toronto Heritage Fund.

Recommendations:

It is recommended that:

(1)the Toronto Heritage Fund Application for 49 Wellington Street East for a sum of up to $25,000.00 dollars be approved;

(2)the grant be conditional on the owner entering into a Restoration Grant Agreement prepared by the City Legal Department in consultation with the Managing Director of the Toronto Historical Board; and

(3)the owner ensure that the Toronto Historical Board's support for this project is suitably recognized.

Background:

The Gooderham Building, also known as the Flatiron Building, was designated under Part IV of the Ontario Heritage Act by By-law No. 534-75, passed by City Council on November 26, 1975. The property is also subject to an Ontario Heritage Foundation Heritage Easement Agreement, registered on September 9, 1977.

On February 10, 1998, Michael McClelland on behalf of David Walsh, the property owner, wrote requesting a grant from the Toronto Heritage Fund to assist with a restoration project phased over four years. The proposed work consists of repair and replacement of copper gutters and flashing at the roof, dormers and corner turret. Masonry repointing and brick replacement are also included. The estimated total cost for all phases is $438,500.00. The first phase work totals $57,884.00.

Comments:

The owner is undertaking a four-year phased restoration project. The scope of work for the first phase, scheduled to commence this summer, includes roof flashing and masonry conservation concentrated on the corner tower and first 5 meters along the north and south walls.

This grant application exceeds the $10,000.00 limit which normally requires the owner to enter into a heritage easement agreement with the City. However, as this property is already subject to a provincial heritage easement agreement, staff does not believe a separate City Agreement is needed. A letter of acceptance in principle to the work from the Ontario Heritage Foundation is attached for the record.

Prior to any work taking place, both the Ontario Heritage Foundation and Heritage Toronto staffs will review and approve the detailed specifications. This work is critical to maintaining the distinctive appearance of the corner turret of the building. Staff of Heritage Toronto believes that the high public profile of this landmark building warrants the recommended grant amount for the first phase and expects to look favourably on proposed future phases.

Contact Name:

John Blumenson, Toronto Historical Board, Tel: (416) 392-6827, ext. 242/Fax: (416) 392-6834.

(A copy of the letter of acceptance referred to in the foregoing report is on file in the office of the City Clerk.)

12

Ad Hoc Requests for City Grants

(City Council on May 13 and 14, 1998, amended this Clause by adding thereto the following:

"It is further recommended that staff of the Public Health Department, in consultation with appropriate City staff, be requested to see if the equipment previously used to measure the noise at the Toronto Island Airport could be made available to assist with the measurement of noise at Pearson Airport.")

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (May 4, 1998) from the Municipal Grants Review Committee:

Recommendation:

The Municipal Grants Review Committee on May 4, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the attached report (April 27, 1998) from the Commissioner of Community and Neighbourhood Services respecting the process for responding to the ad hoc requests for grants.

The Municipal Grants Review Committee reports, for the information of the Strategic Policies and Priorities Committee, having agreed to hear deputations from organizations requesting ad hoc grants during the grants appeals process and prior to final recommendations being forwarded to the Strategic Policies and Priorities Committee.

--------

(Report dated April 27, 1998, addressed to the

Municipal Grants Review Committee from the

Commissioner of Community and Neighbourhood Services)Purpose:

To date, the Municipal Grants Review Committee has received five ad hoc requests for grants (described below). The constraints on the Committee's ability to respond to ad hoc requests are described and an interim approach to such requests is proposed in this report.

Funding Sources, Financial Implications and Impact Statement:

There is no funding source for ad hoc requests within the 1998 global grants budget of $45,160,000.00 recommended by the Budget Committee.

Recommendations:

It is recommended that:

(1)the process for responding to ad hoc requests for grants described in this report be adopted;

(2)all members of Council be informed of the process for responding to ad hoc requests for grants; and

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

Council Reference/Background/History:

The Municipal Grants Review Committee (M.G.R.C.) was established by City Council at its March4,5,6,1998, meeting to:

(a)"develop an integrated Municipal Grants Policy for implementation in 1999; and

(b)for the 1998 interim grants process only, ...be used as the appeal mechanism, to hear and respond to deputations by applicants..."

Since the establishment of the M.G.R.C., a number of issues have been referred to the Committee, either by the Budget Committee or individual Councillors, that have clarified the Committee mandate to include all grants related issues. Through the Budget Committee process a combined grants budget composed of established grant programs and line item grants was referred to the M.G.R.C. One time ad hoc allocations made by the former seven municipalities in 1997 were not carried forward in the 1998 budget. One of the difficult tasks which has fallen to the M.G.R.C. has been to respond to ad hoc requests for grants without having a defined budget or contingency fund for this purpose.

Ad hoc grants include requests that do not fall within the mandate of an existing grants program as well as requests that do fall within an existing program but have not applied through the regular grants processes. There have been five requests for ad hoc funding made either directly to City Councillors and referred to the M.G.R.C., or made directly to the Committee. At its first meeting, the Committee agreed that it would not consider requests made directly to the Committee without first referring the requests to staff for comment.

Comments and/or Discussion and/or Justification:

Budget Constraints:

The Budget Committee has referred the combined listing of City grants, totalling $45,160,000.00 to the M.G.R.C. The combined grants budget at this time does not contain any provisions for ad hoc or one time requests. This figure includes sustaining and project funding programs offered by the seven former Municipalities, but, as directed by the Budget Committee, the one time grants made in 1997 were not included. The Budget Committee directed that the M.G.R.C. could consider one time requests but would have to find the required funding within the total grants envelope of $45,160,000.00.

In addition, given the status quo approach to allocations in 1998 directed by Council, there will be little, if any, flexibility within each grant program or line item allocation. Staff are reporting that in all grants programs, based on the requests already received through established application processes, requests exceed the available funds.

Should the M.G.R.C. decide to recommend requests for ad hoc grants and the required funding not be available within the existing grants envelope, a request to Council for additional funds would be required.

Issues and Ad Hoc Requests:

The following is a list of requests or issues raised to the M.G.R.C. as of April 24, 1998, and the disposition of same.

(1) Portuguese Day Festivities 1998:

A request for $10,000.00 to cover costs associated with the Portuguese Day Festivities to take place in Trinity-Bellwoods Park was referred to the M.G.R.C. by the Toronto Community Council. This event has received funding from contingency in the past from the former City of Toronto. The majority of costs are associated with City services such as Parks and Recreation costs and policing. The event is scheduled for June 10, 1998.

This request has been referred to Parks and Recreation staff.

(2)Etobicoke Federation of Ratepayers and Residents Association (EFRRA) Airport Committee:

The EFRRA Airport Committee has requested $37,750.00 for sound monitoring equipment to determine the noise levels from Pearson Airport. The Etobicoke Federation of Ratepayers and Residents Association (EFRRA) members state that the "noise measurement at Pearson by the GTAA is antiquated, inadequate and under control of the operator and is subject to question."

Senior levels of Government have responsibility in this regard through the Provincial Ministry of the Environment and the Federal Ministry of Transportation. Public Health staff will assist the organization in raising their concerns with the appropriate bodies.

(3)Weston Minor Hockey League:

Councillor Nunziata informed the M.G.R.C. that the agency request should be increased to $25,000.00 due to increased fees for ice time.

Recreation staff are reviewing the agency request for funding and will report to the M.G.R.C. regarding the allocation to this agency at the June 1, 1998, Committee meeting.

(4)York West Seniors Centre:

Councillor Nunziata clarified that the increased grant request for York West Seniors Centre is to cover the increased rent charged by the Metropolitan Toronto Housing Company Limited.

The appropriate agency review staff have been informed of this clarification and will address the issue in the 1998 Community Services Grants Allocation Report to M.G.R.C. in June.

(5)Canada's Walk of Fame:

Canada's Walk of Fame is a special event recognizing celebrated Canadians with stars on the King Street side walk in the Theatre District. The organizing group is requesting $25,000.00 in matching funding to develop the Walk of Fame.

This request has been referred to Economic Development for comment. Although this initiative was endorsed by the former City of Toronto, funds were not included in the 1998 budget for this request.

(6)Queering the Nation Conference:

Councillor Rae has referred a request for $10,000.00 to support a national conference at York University to take place during Pride Week 1998.

The issue of how hospitality/special event functions are administered has been raised with the relevant staff. Staff will raise this request with Special Events to see if it could be considered as a hospitality/special event function.

(7)Kensington Youth Theatre and Employment Skills (KYTES):

Kensington Youth Theatre and Employment Skills (KYTES) is a unique youth employment program which has requested additional core funding to address a funding shortfall (no specific amount requested).

Kensington Youth Theatre and Employment Skills (KYTES) has applied for funding under the Toronto Arts Council, Community Services Grants Program, and the Drug Prevention Program. In addition, the Agency is an approved training provider under Ontario Works. Staff will report on the KYTES request through the 1998 Community Services Grants Allocations Report in June, 1998.

(8)Gay Games Bid:

Councillor Rae has referred a request for deficit funding of $12,000.00 for the unsuccessful 2002 bid and support for the 2006 Bid. Municipal grants programs do not provide deficit funding. Pending a report from staff, should the M.R.G.C. wish to support this request, it will need to vary existing grants practice and request additional funding from Council. The request has been referred to Economic Development and Recreation for comment.

(9)Hospital Grants:

Councillor Duguid raised a question with respect to the grants to Hospitals included in the Listing of Municipal Grants. These allocations are related to property taxes and will be addressed in the overall review of Municipal grants. Council direction to take a status quo approach to grants allocations will result in an inequitable treatment of hospitals in 1998 (reflecting the inequitable funding arrangements under the former Municipalities in 1997).

(10)Funding for Canada Day Events:

The Special Events Unit has responsibility for the administration of Canada Day Events and will provide a report on planning, funding, and administration of Canada Day Events to the M.G.R.C. for information.

Interim Ad Hoc Grant Process:

A number of ad hoc requests for grants have been made. It is difficult for the M.G.R.C. to consider ad hoc requests prior to consideration of applicants who have requested funds through the regular grants process. As outlined in the report titled "Appeals Process", also before Committee, eight allocations reports containing the allocation recommendations made under the various grants programs will be before the M.G.R.C. at the June 1 and 2, 1998, meeting.

Several of the ad hoc requests are time sensitive in that the funds are requested for activities occurring in late May or June. However, without a specific budget for one time, ad hoc allocations, consideration on such requests may disadvantage organizations who have already applied for funding through the established grants programs.

All ad hoc requests to date have been referred to staff for review and comment. Where the request falls within the mandate of a specific grants program it has been referred to the relevant staff for comment. Where it does not fit with an existing area, it will be reviewed by Social Development staff. For the June 1 and 2, 1998, M.G.R.C. meeting, staff will provide an assessment of whether or not the request falls within the City's mandate, an initial review of the need for City funding and whether or not funds are available (in the absence of a budget for ad hoc requests, it is unlikely that funding will be available).

In the situation where an ad hoc request does fall within the City mandate and the need for funding is clear, but funds are not available, the M.G.R.C. will be required to determine whether or not a recommendation goes forward to Strategic Policies and Priorities to identify additional grants funding in order to support the ad hoc request. In addition, the M.G.R.C. must decide whether or not it will permit organizations making a request for an ad hoc grant to make deputation to the Committee before making a recommendation to the Strategic Policies and Priorities Committee.

Communication Plan:

Once the proposed process for responding to ad hoc grants requests is established by the M.G.R.C. and approved by the Strategic Policies and Priorities Committee and Council, staff will undertake to communicate the process to all members of Council. In addition, the process will be communicated to any organization wishing to make a request for an ad hoc grant.

Conclusions:

Where possible, one time requests have been referred to the appropriate department or service area either for consideration or with a request for a report back to the M.G.R.C. There is no funding for one time requests within the 1998 global grants budget.

The development of the Municipal Grants Policy will address the issue of ad hoc grant requests. In the absence of the Municipal Grants Policy, it is recommended that the interim ad hoc grants process described above be adopted.

Contact Name:

Chris Brillinger: 392-8608.

(City Council on May 13 and 14, 1998, had before it, during consideration of the foregoing Clause, the following report (May 12, 1998) from the City Clerk:

Recommendation:

That Clause No. 12 of Report No. 8 of The Strategic Policies and Priorities Committee be amended by adding to the recommendation of the Committee the following:

"and that staff of the Public Health Department see if the equipment previously used to measure the noise at the Toronto Island Airport could be made available to assist with the measurement of noise at Pearson Airport.".

Background:

On May 5, 1998, the Strategic Policies and Priorities Committee had before it a transmittal letter (May 4, 1998) from the Municipal Grants Review Committee recommending that the process for responding to ad hoc requests for grants outlined in the report (April 27, 1998) from the Commissioner of Community and Neighbourhood Services be adopted. One of the requests was from the Etobicoke Federation of Ratepayers and Residents Association Airport Committee for a grant of $37,750.00 for sound monitoring equipment to determine the noise levels from Pearson Airport.

The following is the disposition of this request by the Municipal Grants Review Committee:

"Senior levels of Government have responsibility in this regard through the Provincial Ministry of the Environment and the Federal Ministry of Transportation. Public Health staff will assist the organization in raising concerns with the appropriate bodies."

When recommending adoption of all of the recommendations of the Municipal Grants Review Committee, the Strategic Policies and Priorities Committee also requested the staff of the Public Health Department to see if the equipment used to measure noise at the Toronto Island Airport could be made available to assist with the measurement of noise at Pearson Airport. This recommendation was inadvertently omitted from the recommendation in the Clause.)

13

Financial Administration of the Cultural Grants Budget

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (May 4, 1998) from the Municipal Grants Review Committee:

Recommendation:

The Municipal Grants Review Committee on May 4, 1998:

(1)recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the report (April 16, 1998) from the Commissioner of Economic Development, Culture and Tourism, respecting the financial administration of the Cultural Grants Budget; and

(2)received the report (April 21, 1998) from the President of the Toronto Arts Council and the communication from Ms. Susan Robinson, Resident, Cedar Ridge Studio Gallery.

Background:

The Municipal Grants Review Committee had before it the following reports and communication:

(a)(April 24, 1998) from the City Clerk advising that the Budget Committee on April 20, 1998, referred to the Municipal Grants Review Committee a report dated April 16, 1998, from the Commissioner of Economic Development, Culture and Tourism recommending that:

(1)the amount of $7,285,118.00, based on a flatlined Cultural Grants budget, be assigned to the Toronto Arts Council for the allocation of Cultural Grants in the former City of Toronto once the budget is approved by Council;

(2)the payment of that amount follow the disbursement schedule outlined in this report; and

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

(b)(April 21, 1998) from Ms. Anne Collins, President, Toronto Arts Council respecting disbursements to the Toronto Arts Council; and

(c)(undated) from Ms. Susan Robinson, President, Cedar Ridge Studio Gallery, advising that the Board of Directors and Members of the Cedar Ridge Studio Gallery request that support be given to the:

(1)current recommendation for a freeze to the entire cultural grants budget (to be administered by the Toronto Arts Council, the Etobicoke Municipal Arts Commission and the Culture Office, City of Toronto) at the 1997 level; and

(2)Toronto Arts Council request for $250,000.00 in order to extend in 1998 the four grants programs in support of individual artists beyond the former City of Toronto borders so that artists across the City have an opportunity to access these important programs.

--------

(Communication dated April 21, 1998, addressed to

the Municipal Grants Review Committee, from

the Budget Committee)

Recommendation:

The Budget Committee on April 20, 1998, reports having referred the report (April 16, 1998) from the Commissioner of Economic Development, Culture and Tourism, to the Municipal Grants Review Committee.

Background:

The Budget Committee on April 20, 1998, had before it a report (April 16, 1998) from the Commissioner of Economic Development, Culture and Tourism, regarding the financial administration of the 1998 Cultural Grants Budget.

--------

(Report dated April 16, 1998, addressed to the

Budget Committee from the

Commissioner of Economic Development, Culture and Tourism)

Purpose:

Upon the approval of the 1998 Cultural Grants budget, a portion of that budget is to be paid to the Toronto Arts Council for allocation of Cultural Grants in the former City of Toronto under the terms of the TAC grant agreement with the City. This report sets out the level and disbursement schedule for that payment.

Funding Sources, Financial Implications and Impact Statement:

There are no funding implications of this report.

Recommendations:

It is recommended that:

(1)the amount of $7,285,118.00, based on a flatlined Cultural Grants budget, be assigned to the Toronto Arts Council for the allocation of Cultural Grants in the former City of Toronto once the budget is approved by Council;

(2)the payment of that amount follows the disbursement schedule outlined in this report; and

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

Council Reference/Background/History:

At its meeting of February 4 and 5, 1998, Council approved a report, entitled "Administration of Municipal Grants Programs." This report set out the following process for the administration and assessment of Arts and Culture Grants in 1998:

(a)the Toronto Arts Council (TAC) shall receive and review applications originating in the former City of Toronto under the terms of its grant agreement with the City of Toronto;

(b)staff (of the Culture Office) shall receive and review all other applications, including applications from organizations previously funded by Metro and not the TAC, including the major regional cultural institutions; and

(c)under the terms of its 1994 grant agreement with the former City of Toronto, approval of allocations and the review of appeals have been delegated to the Toronto Arts Council.

Comments and/or Discussion and/or Justification:

Based on an analysis of cultural grant allocations in 1997, the TAC allocation of the 1998 Cultural Grants budget should be $7,285,118.00. This would allow the Toronto Arts Council to administer its grants program, including the funding that was previously available from Metro to TAC applicants.

The Toronto Arts Council's agreement with the City of Toronto requires a disbursement schedule to be determined at the time the budget is approved. The following payment schedule would allow the Toronto Arts Council to allocate grants in its various programs in a timely manner:

February 1988 (Interim Allocation) $ 1,496,631.00 (received)
May 11, 1998 5,154,406.00
August 1, 1998 436,581.00
October 1, 1998 197,500.00
TAC Total 1998 $ 7,285,118.00

These figures are based on a flatline total Cultural Grants budget of $11,879,898.00. Any reduction to the overall Cultural Grants Budget originating from final Council decision should be applied proportionally to the total TAC allocation, and split over the three remaining payments. Any increase to the Cultural Grants Budget designated for the Toronto Arts Council should be applied to the final payment of October 11, 1998.

Conclusions:

This allocation schedule assumes a 1998 Cultural Grants budget equal to the 1997 base budget. The allocation of funds to the Toronto Arts Council would allow them to carry out their share of the responsibility for administering the 1998 Cultural Grants, as approved by Council in February 1998. The Treasurer has reviewed this schedule and is in full concurrence.

Contact Name:

Kathleen Sharpe, 392-55225/ FAX: 392-3355, m._kathleen_sharpe@metrodesk.metrotor.on.ca.

--------

(Communication dated April 21, 1998, addressed to

the Municipal Grants Review Committee, from

Ms. Anne Collins, President, Toronto Arts Council)

Background:

This report recommends the necessary disbursements to the Toronto Arts Council in order for it to allocate grants in its existing area of jurisdiction in a timely manner.

Recommendation:

It is recommended that:

(1)The 1998 allocation for Toronto Arts Council's cultural grants budget be confirmed at $7,285,118.00 which comprises the following amounts:

Cultural Grants Program - former City of Toronto$4,726,198.00*

Cultural Grants Program - former Metro Toronto$2,598,920.00

Reduce amount per CAO's April 2, 1998 report

on the Caribbean Cultural Committee($40,000.00)

Total 1998 Allocation$7,285,118.00

(2)The cultural grants budget be disbursed to the Toronto Arts Council according to the following schedule:

February(Actual to date)$1,496,631.00

May 11$5,154,406.00

August 1$ 436,581.00

October 1$ 197,500.00

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

Comments:

City Council in approving on January 2, 6, 8 and 9, 1998, the final report of the Transition Team on an interim basis, approved Recommendation 103 which provides that the Toronto Arts Council should continue to allocate grants within its existing area of jurisdiction.

Many organizations have received cultural grants in the past from both their local municipality and Metro. As there now exists only one level of government in the new amalgamated Toronto, organizations which in 1997 received grants from both the Toronto Arts Council and Metro Culture Division will in 1998 receive one grant from the Toronto Arts Council which is based on the combined total of their 1997 local municipal grants plus their Metro grant. In order to properly respond to the existing need in its area of jurisdiction, Toronto Arts Council is requesting a 1998 cultural grants budget of $7,575,118.00 which combines the 1997 TAC budget of $4,976,198.00 with $2,598,920.00 representing that portion of the former Metro Toronto cultural grants budget for which Toronto Arts Council has jurisdiction in 1998.

* This amount does not include $250,000.00 from the former City of Toronto's 1997 Cultural Grants Program which has been submitted as a separate request to enable TAC to extend individual grants program city-wide.

--------

(Communication Undated, addressed to the

Municipal Grants Review Committee, from Ms. Susan Robinson,

President, Cedar Ridge Studio Gallery)

I am writing to you on behalf of the Board of Directors and Members of Cedar Ridge Studio Gallery to request that you:

(1)support the current recommendation for a freeze to the entire cultural grants budget (to be administered by the Toronto Arts Council, the Etobicoke Municipal Arts Commission and the Culture Office, City of Toronto) at the 1997 level; and

(2)support the Toronto Arts Council request for $250,000.00, in order to extend the 1998 the four grants programs in support of individual artists beyond the former City of Toronto borders so that artists across the city have an opportunity to access these important programs.

As you are aware Cedar Ridge has played a major role in the arts community of Scarborough for many years. You have always been very supportive of our endeavours and we of yours. We are once again asking for your support to retain funding for the arts. Until such time as the Transition Team recommendations have been implemented it is most important that funded programs are allowed to continue.

A few facts to ponder:

(i)of all GTA employment, 10.5 percent is in arts and culture;

(ii)Cultural tourism contributes $1 billion in revenue to Toronto;

(iii)as a result of a strong cultural sector, Fortune Magazine continues to recognize Toronto as one of the ten most desirable places in which to live and work;

(iv)culture creates community and gives Toronto its unique character making it one of the best cities on the continent; and

(v)municipal investment in the arts through grants is an effective and efficient method of supporting one of this City's bedrock industries.

We thank you for your consideration of this request when you are voting for the arts budget. In Scarborough arts and culture have always been a vibrant part of the community and we hope with your support it will continue to be.

14

City of Ottawa Request for Financial Support -

International Institute of Municipal Clerks (IIMC) Conference

- May, 1999

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (May 4, 1998) from the Municipal Grants Review Committee:

Recommendation:

The Municipal Grants Review Committee on May 4, 1998, recommended to the Strategic Policies and Priorities Committee, and Council, the adoption of the attached report (March 23, 1998) from the City Clerk requesting a grant in the amount of $10,000.00 to the City of Ottawa to help defray the costs of hosting the 1999 Conference of the International Institute of Municipal Clerks.

(Communication dated April 27, 1998, addressed to the

Municipal Grants Review Committee from the City Clerk)

Recommendation:

The Budget Committee on March 30 and March 31 and April 2 and 3, 1998, recommended that the report (March 30, 1998) from the City Clerk requesting a grant in the amount of $10,000.00 to the City of Ottawa "to help defray the costs of hosting the 1999 Conference of the International Institute of Municipal Clerks", be referred to the Municipal Grants Review Committee for consideration.

Background:

The Budget Committee on March 30 and March 31 and April 2 and April 3, 1998, had before it a letter of transmittal (March 30, 1998) from the Corporate Services Committee wherein the Committee on March 30, 1998, submitted to the Budget Committee, without recommendation, having regard that all motions put and voted on lost, a report (March 23, 1998) from the City Clerk recommending that:

(1)City Council approve a grant of $10,000.00 to the City of Ottawa, to help defray costs of hosting the 1999 Conference of the International Institute of Municipal Clerks;

(2)the grant be deemed to be in the interest of the municipality; and

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

--------

(Communication dated March 30, 1998, addressed

to the Budget Committee, from

the Corporate Services Committee)

Recommendation:

The Corporate Services Committee submits the report (March 23, 1998) from the City Clerk to the Budget Committee without recommendation having regard that all motions put and voted on lost.

Background:

The Corporate Services Committee on March 30, 1998, had before it a report (March 23, 1998) from the City Clerk recommending that:

(1)City Council approve a grant of $10,000.00 to the City of Ottawa, to help defray costs of hosting the 1999 Conference of the International Institute of Municipal Clerks;

(2)the grant be deemed to be in the interest of the municipality; and

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

--------

(Report dated March 23, 1998, addressed to the

Corporate Services Committee from the

City Clerk)

Purpose:

To request Council approval of a grant of $10,000.00 to the City of Ottawa, to help defray costs of hosting the 1999 Conference of the International Institute of Municipal Clerks.

Funding Sources, Financial Implications and Impact Statement:

Funds for this purpose are included in the 1998 Operating Budget. This investment will benefit the City of Toronto's economy by generating approximately $400,000.00 in tourism revenue.

Recommendations:

It is recommended that:

(1)City Council be requested to approve a grant of $10,000.00 to the City of Ottawa, to help defray costs of hosting the 1999 Conference of the International Institute of Municipal Clerks;

(2)the grant be deemed to be in the interest of the municipality; and

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

Background:

On June 26, 1995, the Council of the former City of Toronto adopted the recommendation of its Executive Committee (Clause 16 of Report No. 17 of the Executive Committee) that, subject to the availability of funds, the next Council (elected in November, 1997) be requested to make a grant in 1998 of $10,000.00 to the City of Ottawa to help defray costs of hosting the 1999 Conference of the International Institute of Municipal Clerks. This was to be conditional upon the City of Toronto being designated as an official post-conference tour destination. Confirmation has since been received that Toronto has been selected as one of two post-conference tour locations. Since financial commitments could not be made by the previous Council on behalf of the newly-created amalgamated City of Toronto, this matter was held in abeyance, but it is now appropriate to seek Council approval.

The City of Ottawa will also be seeking grants from other Canadian municipalities for this conference.

Comments:

In 1999, Ottawa will be hosting the annual conference of the International Institute of Municipal Clerks (I.I.M.C.). Up to 2,000 delegates will attend. The majority will be from the United States, but many will be from other parts of Canada and from the United Kingdom, Australia, Israel, Africa and other countries. The City of Ottawa was advised by the Ottawa Tourism Authority and the Province of Ontario, that the Conference will generate about $4.2 million for Ontario. Toronto has been included as one of two post-conference tour destinations. It is estimated that approximately 500 delegates will visit Toronto for three days. Tourism Toronto estimates that the City of Toronto's economy would benefit by about $400,000.00 in accommodation, meals, shopping, visits to the City's tourist attractions, taxis, etc.

Since the City of Ottawa must begin arrangements for the conference, prior approval of these funds is being sought, ahead of Council approval of the Operating Budget.

Conclusion:

The grant of $10,000.00 will help defray costs of hosting the 1999 Conference of the International Institute of Municipal Clerks, held in the City of Ottawa. It is deemed to be in the interest of the City of Toronto.

Contact Names:

Syd Baxter: 392-3769

Naomi Joel: 392-4374

(A copy of Clause 16 of Report No. 17 of the former City of Toronto Executive Committee, adopted by City Council on June 26 and 27, 1995, referred to in the foregoing report, was forwarded to all Members of Council with the agenda of the Municipal Grants Review Committee for its meeting on May 4, 1998, and a copy thereof is on file in the office of the City Clerk.)

15

Request for Special Meeting of Council to Deal with

Tax Policy and Tax Rate Matters

(City Council on May 13 and 14, 1998, adopted this Chause, without amendment.)

The Strategic Policies and Priorities Committee recommends:

(1)the adoption of the following motion of Councillor Adams embodied in the transmittal letter (May 4, 1998) from the Assessment and Tax Policy Task Force:

"BE IT RESOLVED THAT a Special Meeting of City Council be held on June22 and 23, 1998, to deal with tax policy and tax rate matters;

AND BE IT FURTHER RESOLVED THAT, in order to accommodate this Special Meeting of Council, the meeting of the Corporate Services Committee, scheduled to be held on June 22, 1998, be rescheduled to June 29, 1998, and the meeting of the Budget Committee, scheduled to be held on June 23, 1998, be rescheduled to the afternoon of June 29, 1998; and

AND BE IT FURTHER RESOLVED THAT a Special Meeting of the Strategic Policies and Priorities Committee be held on June 17, 1998, to consider the report of the Assessment and Tax Policy Task Force for report thereon to Council."

(2)that the Budget Committee meet on June 19, 1998, at 2:00 p.m. to approve the levying amounts and corresponding tax rates by-law; and

(3)that the Strategic Policies and Priorities Committee meet on June 22, 1998, at 9:00 a.m. to transmit the Budget Committee recommendations to Council on June 22 and 23, 1998.

The Strategic Policies and Priorities Committee submits the following transmittal letter (May4, 1998) from the Assessment and Tax Policy Task Force:

Recommendation:

The Assessment and Tax Policy Task Force on May 4, 1998, recommended to the Strategic Policies and Priorities Committee and City Council, the adoption of the following motion of Councillor Adams:

"BE IT RESOLVED THAT a Special Meeting of City Council be held on June 22 and 23,1998, to deal with tax policy and tax rate matters;

AND BE IT FURTHER RESOLVED THAT, in order to accommodate this Special Meeting of Council, the meeting of the Corporate Services Committee, scheduled to be held on June22, 1998, be rescheduled to June 29, 1998, and the meeting of the Budget Committee, scheduled to be held on June 23, 1998, be rescheduled to the afternoon of June 29, 1998; and

AND BE IT FURTHER RESOLVED THAT a Special Meeting of the Strategic Policies and Priorities Committee be held on June 17, 1998, to consider the report of the Assessment and Tax Policy Task Force for report thereon to Council."

The Task Force reports that it has approved the following schedule for its future meetings:

Tuesday, May 12, 19989:30 a.m.

Tuesday, May 26, 19982:00 p.m

Friday, June 12, 19989:30 a.m.

Monday, June 15, 19989:30 a.m. (if necessary)

Tuesday, June 16, 19989:30 a.m. (if necessary)

Comments:

The Assessment and Tax Policy Task Force had before it a report (April 14, 1998) from the Chief Financial Officer and Treasurer providing an updated process for the development of a tax implementation plan for Council; and a motion by Councillor Adams requesting that a Special meeting of Council and a special meeting of the Strategic Policies and Priorities Committee be scheduled to deal with tax policy and tax rate matters.

16

Establishment of an Auditor General's Office

(City Council on May 13 and 14, 1998, struck out and referred this Clause back to the Audit Committee for further consideration, in conjunction with the previously requested report from the City Auditor regarding the City of Ottawa model.)

The Strategic Policies and Priorities Committee reports having received the following transmittal letter (April 22, 1998) from the Audit Committee:

Recommendation:

That City Council adopt, in principle, the establishment of an Auditor General's office and:

(1)request the Chief Administrative Officer and the City Auditor to prepare a report on the timing and establishment of an Auditor General's office; and

(2)include the Agencies, Boards and Commissions under the purview of such office.

On April 21, 1998, the Audit Committee had before it a report (April 2, 1998) from the City Auditor on the establishment of an Auditor General's Office.

The above recommendation of the Audit Committee is forwarded to the Strategic Policies and Priorities Committee for consideration and recommendation to Council.

--------

(Report dated April 2, 1998, addressed to the

Audit Committee from the City Auditor)

Recommendation:

It is recommended that this report be received for information.

Background:

On March 24, 1998, the Audit Committee adopted the following motion by Councillor Minnan-Wong:

"WHEREAS the City of Toronto is the fifth largest city in North America, with a budget in excess of six billion dollars, and is bigger in size than many provinces; and

WHEREAS given the massive size of the new government, it is becoming increasingly difficult to monitor the spending and administration of the City of Toronto; and

WHEREAS an Auditor General's Office can take a proactive approach in suggesting which City departments and branches are functioning effectively and where improvements can be made; and

WHEREAS there are currently Auditors General in both the Federal and Provincial Governments; and

WHEREAS this proactive approach will improve service delivery and keep taxes down; and

WHEREAS the City of Toronto needs an independent watchdog that will report directly to Council; and

THEREFORE BE IT RESOLVED that staff be directed to prepare a report for consideration at the next meeting of the Audit Committee on the establishment of an Auditor General's Office, similar to those in the Federal and Provincial governments."

Comments:

Auditor General of Canada:

The Auditor General of Canada reports functionally and administratively directly to Parliament. The mandate of the Auditor General is set out in the Auditor General Act which came into force in 1997. The Act outlines the duties of the Auditor General as follows:

"To make such independent examinations and inquiries as he considers necessary and, based on them, to report on whether or not there were significant deficiencies in the management control systems and practices in the audited entity during the period under examination: thereby providing reasonable assurance, where possible, that:

(i)public assets are safeguarded and controlled;

(ii)transactions are lawful and proper;

(iii)financial, human and physical resources are managed with due regard to economy and efficiency, and procedures are in place to measure and report the effectiveness of the programs.

To call attention to anything that he considers to be of significance and of a nature that should be brought to the attention of the House of Commons, to communicate his findings and observations to management of the audited entity and to make any constructive recommendations he may have.

To maintain the status of his Office and share its expertise with Canadian and international colleagues.

To manage his Office with due regard for economy, efficiency and effectiveness, ensuring professional and administrative competence and adherence to applicable government policies."

Provincial Auditor of Ontario:

The Audit Act of Ontario contains similar provisions to the Auditor General Act, and as such, the reporting relationship and duties of the Provincial Auditor generally parallel those of the Auditor General.

The City Auditor:

The City Auditor reports on a professional basis to the Audit Committee, and on an administrative basis to the Commissioner of Corporate Services.

The proposed mandate of the Audit Department was included in a submission to the Budget Committee of the City and included the following:

(i)"To conduct operational audits, defined as evaluating the management of public funds and resources from a standpoint of economy, efficiency and effectiveness. Recommend operating improvements;

(ii)To examine and evaluate the adequacy of the City's systems of internal control, both financial and operational;

(iii)To evaluate the procedures used by management to measure and report on program effectiveness. A review of the results of such programs or activities will include an evaluation relating to the results or benefits achieved and whether the programs or activities are meeting established objectives;

(iv)To examine problem areas brought to the attention of the City Auditor by Council and senior management. To act as an ongoing resource to senior management;

(v)To carry out special assignments ranging from consulting work to investigating suspected fraud or wrongdoing;

(vi)To determine whether or not applicable sections of by-laws, regulations and management directives, etc., have been complied with, as well as applicable federal and provincial legislation;

(vii)To co-ordinate the financial internal audit activities with the external auditors of the City to ensure the efficient and economical use of audit resources; and

(viii)To conduct attest audits as appropriate."

The proposed mandate of the City Auditor is in many respects similar to the one which exists at both the Federal and Provincial Auditor level. Consequently, the type of work being conducted at the City level parallels that of the Auditor General and the Provincial Auditor. In addition, the selection of an area for audit is based on similar criteria as currently exists at the Federal and Provincial levels. In general terms, the City Auditor during his selection of audit projects would consider the following:

(a)the significance of an entity or activity;

(b)major cost centres with potential savings;

(c)major problem areas to the Corporation;

(d)specific problems in process, organization or function;

(e)part of a specific audit cycle approved by Council;

(f)political sensitivity;

(g)public sensitivity; and

(h)management competence, etc.

Each of these criteria would be factored into an audit plan which would form the basis for audit work over a predetermined cycle. This process exists at both the Federal and Provincial level.

As can be seen from the above, there are distinct similarities between the audit process at the City and the Federal and Provincial governments, particularly in the type of work conducted, as well as the selection of the audit work to be done.

The major difference between audit functions, however, relates to the degree of independence afforded the Auditor General, the Provincial Auditor and the City Auditor. Both the Auditor General and the Provincial Auditor are completely independent of the government and its administration. While independence in an audit function is of critical importance, a similar degree of independence at the City level would not be in the best interest of the effective management of the municipality. One of the benefits of the current audit arrangements relates to the department's relationship with both the City Audit Committee and management. It is particularly important during the transition process that the City Auditor work closely with both the Committee and management to address issues of mutual concerns. Even at this early stage in the evolution of the City, this relationship is assuming significant importance when viewed in the context of the requests for specific audit work by the Budget Committee. The development of the City Auditor's annual work plan will provide the flexibility for such projects.

The Chief Administrative Officer, as well as senior management requires an independent resource to address audit and financial related concerns on an ongoing basis. Because of its broad overview of the corporate picture, Audit Departments are generally called upon to provide advice and consultation on a wide range of issues, including accounting and procedural concerns, as well as broad operating and policy issues. It is important that this resource continue to be available to the senior corporate management staff.

Adopting the Auditor General reporting model would compromise the benefits management receives from its audit function. Assisting management in resolving problems, as well as providing assistance in implementing change is one of the benefits of the current audit arrangements. Due to the fact that the Auditor General and the Provincial Auditor are required to remain completely independent, they do not generally provide the degree of advice and assistance often required by management to ensure changes and improvements are successfully implemented.

Conclusion:

The mandates of the Auditor General's Office, as well as the Ontario Provincial Auditor's Office are similar in many respects to the mandate proposed for the City Auditor's Office. Consequently, the type of work conducted by the Department will parallel that of the Federal and Provincial Auditors. The ongoing independence of the City audit function is served through its relationship with the Audit Committee. The terms of reference outlined in the City Auditor's report to the Committee dated March 4, 1998, clearly articulate the responsibilities of the Committee in relation to the City Auditor. In addition, the same report indicates that 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. This process is best served by the current audit arrangements. It is recognized, however, that as the City evolves over the next number of years, the audit process may require further review and refinement. This report does not recommend an Auditor General reporting model for the City.

Contact Name and Telephone Number:

Jeffrey Griffiths, 392-8461.

17

Other Items Considered by the Committee

(City Council on May 13 and 14, 1998, received this Clause, for information.)

(a)Contract No. T-42-98: Don Valley Parkway Resurfacing at Two Locations

The Strategic Policies and Priorities Committee reports having referred the transmittal letter (April 22, 1998) from the Urban Environment and Development Committee to the Budget Committee with the request that it report back to Council with its report on the $9.1 million Capital Project:

(April 22, 1998) from the Urban Environment and Development Committee recommending adoption of recommendations regarding Contract No. T-42-98 for the resurfacing of the Don Valley Parkway at two locations.

(b)Auditor's Report and Financial Statements of the Metropolitan Toronto Convention and Visitors Association for the year ended December 31, 1997

The Strategic Policies and Priorities Committee reports having received the Auditor's Report and Financial Statements of the Metropolitan Toronto Convention and Visitors Association for the year ended December 31, 1997:

(April 2, 1998) from the City Auditor forwarding the Auditor's Report and Financial Statements of the Metropolitan Toronto Convention and Visitors Association for the year ended December 31, 1998, copies of which were forwarded to all Members of Council with the Agenda of the Audit Committee meeting held on April 21, 1998.

(c)Property Tax Rebates for Charitable and Similar Organizations

The Strategic Policies and Priorities Committee reports having received the following communications with respect to Property Tax Rebates for Charitable and Similar Organizations, since this matter was dealt with by City Council at its meeting held on May 1, 1998:

(i)(April 22, 1998) from the Assessment and Tax Policy Task Force;

(ii)(April 8, 1998) from Gowling, Strathy & Henderson, Barristers & Solicitors;

(iii)(April 27, 1998) from Brian Bowes, CMA, Manager of Finance, Writers Guild of Canada;

(iv)(April 27, 1998) from Ellen Anderson, Creative Spirit Art Centre;

(v)(April 27, 1998) from Esther Vise, Toronto Women's Bookstore;

(vi)(April 23, 1998) from Peter Clutterbuck, Co-Director, Community Social Planning Council of Toronto and Chair, Community Voices of Support; and

(vii)(April 27, 1998) from Nigel F. Byars, Chartered Accountants of Canada.

(d)Phase-In Policy Respecting the Residential Property Class

The Strategic Policies and Priorities Committee reports having referred the transmittal letter (April 22, 1998) from the Assessment and Tax Policy Task Force as amended by its further letter (May 4, 1998) to a special meeting of the Strategic Policies and Priorities Committee being scheduled in June, 1998, to deal with tax policy and tax rate matters:

(a)(April 22, 1998) from the Assessment and Tax Policy Task Force, advising that on April 20, 1998, it:

(i)recommended that the Provincial Government be requested, when implementing Current Value Assessment to use a moving average of assessed value ultimately using three different years of assessment; and

(ii)requested the Chief Financial Officer and Treasurer to report on (1) providing the figures and impact of allowing the decreases and phasing in the increases; (2) immediate implementation of Current Value Assessment instead of phase-in for those low-income seniors and disabled persons whose property tax decrease; and (3) the effect of establishing a threshold of $333.00 for the implementations of either increases or decreases.

(b)(May 4, 1998) from the Assessment and Tax Policy Task Force advising that on May4, 1998, that it was amending its letter (April 22, 1998) to submit the Phase-In policy respecting the Residential Property Class, without recommendation.

(e)Impact of Current Value Assessment on the Toronto Transit Commission (TTC)

The Strategic Policies and Priorities Committee reports having referred the request set out in the communication (March 27, 1998) from Vincent Rodo, General Secretary of the Toronto Transit Commission:

that the City of Toronto petition the Province of Ontario to exempt TTC properties from realty assessment when used for transit functions,

to the Commissioner of Finance and Treasurer for a report back to the next meeting of the Strategic Policies and Priorities Committee and request that she look at all options, including how Hydro properties are valued:

(April 22, 1998) from the Assessment and Tax Policy Task Force, advising that on April 20, 1998, it recommended to the Strategic Policies and Priorities Committee that the communication (March 27, 1998) from the General Secretary, Toronto Transit Commission be received.

(f)Coat of Arms for the City Of Toronto

The Strategic Policies and Priorities Committee reports having:

(1)referred the report (April 28, 1998) from the Chief Administrative Officer back to staff and requested the City Clerk to co-operate with the Chief Herald's Office to facilitate input from Members of Council and eventually the public via the Community Council Chairs; and

(2)directed that the new Coat of Arms for the new City of Toronto contain a component of each of the former municipalities, if possible, and that a large component include recognition the City's aboriginal heritage.

(April 28, 1998) from the Chief Administrative Officer proposing a Coat of Arms for the City of Toronto prepared by the Chief Herald of Canada.

(g)Comments on Proposed New Municipal Act Provisions

The Strategic Policies and Priorities Committee reports having received the report (April 27, 1998) from the Chief Administrative Officer and Commissioner of Economic Development, Culture and Tourism and the report (May 1, 1998) from the City Solicitor and Chief Administrative Officer, regarding modifications to the proposed new Municipal Act, in view of the position taken by City Council when it considered Clause 13 of Strategic Policies and Priorities Committee Report No. 4, on May 1, 1998.

(i)(April 27, 1998) from the Chief Administrative Officer and Commissioner of Economic Development, Culture and Tourism commenting on the proposed new Municipal Act from an economic development perspective; and

(ii)(May 1, 1998) from the City Solicitor and the Chief Administrative Officer, setting out further modifications to the new Municipal Act.

(h)Cement Lining of Cast Iron Pipe Within the City Of Etobicoke - Fer-Pal Construction Ltd.

The Strategic Policies and Priorities Committee reports having considered matters relating to the award of Contracts Nos. EB9801WS and EB9802WS referred in Clause No.4 of Report No. 4 of the Works and Utilities Committee and reports having:

(1)received the communication (April 29, 1998) from Councillor Disero forwarding correspondence (April 29, 1998) from Fer-Pal Construction Ltd.;

(2)received the transmittal letter (April 30, 1998) from the Works and Utilities Committee advising that in Clause No. 4 of its Report No. 4 it is recommending to Council on May 13 and 14, 1998, the award of Contracts Nos. EB9801WS and EB9802WS; and

(3)requested the Commissioner of Corporate Services, in consultation with the appropriate staff, to review the tendering process and documentation used throughout the Corporation with a view to providing for a more open process in the future.

(i)(April 29, 1998) from Councillor Disero, referring the correspondence (April27,1998) from the President and Vice-President, Fer-Pal Construction Ltd. respecting the decision of the Works and Utilities Committee with respect to tenders.

(ii)(April 30, 1998) from the City Clerk advising of the action taken by the Works and Utilities Committee in the award of Contracts Nos. EB9801WS and EB9802WS for watermain cleaning and cement lining at various locations in the Etobicoke District.

Mr. Shaun McKaigue of Fer-Pal Construction Ltd. appeared before the Strategic Policies and Priorities Committee at its meeting held on May 5, 1998.

(Refer to Clause 4 of Report No. 4 of the Works and Utilities Committee.)

(i)Service Levels and User Fees

The Strategic Policies and Priorities Committee reports having requested the Chief Administrative Officer to report to its next meeting as to the process and timetable for the establishment of service levels and user fees.

Respectfully submitted,

MEL LASTMAN,

Chair

Toronto, May 5, 1998

(Report No. 8 of The Strategic Policies and Priorities Committee, including additions thereto, was adopted, as amended, by City Council on May 13 and 14, 1998.)

 

   
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