June 14, 1999

To:Policy and Finance Committee

From:Chief Administrative Officer

Subject:Contracting of Consulting Services in 1998

Purpose:

The purpose of this report is to summarize the consulting services contracted by City Departments, Agencies, Boards and Commissions in 1998. Our report on contracting and consulting services will be submitted on an annual basis.

Financial Implication:

There are no financial implications.

Recommendations:

It is recommended that this report be received for information.

Council Reference/Background/History:

The Budget Committee at its meeting on January 13, 1999 requested that the Chief Administrative Officer report back to the Budget Committee at its meeting of June 22, 1999 on the hiring of outside Consultants City wide, including Agencies, Boards and Commissions.

Comments and Discussion:

In order to comply with the requirements of the Budget Committee all City Departments, Agencies, Boards and Commissions were contacted and asked to provide details on the consulting services they contracted in 1998.

The information provided included the name of the consultant, description of the work, date consultant contracted and the total value of the contract including all taxes.

A listing of all consulting services contracted in 1998 by the Departments, Agencies, Boards and Commissions is attached to this report as Appendix 'A'.

Amalgamation, Transition and Restructuring Initiatives:

In 1998 there were a total of 35 consulting contracts issued for amalgamation and transition matters having a total value of $2,913,912.05. These contracts related to the retention of external consultants to assist in the major aspects of administrative amalgamation, including (1) organizational restructuring of management levels and (2) the service integration/rationalization initiatives of departments. This work was in response to a Council directive for external expertise, advice, objectivity and validation of amalgamation activities.

These expenditures have been previously reported to the Budget Committee in a report dated April 6, 1999 regarding external consulting expenditures relating to Amalgamation.

Total Number and Value of Consulting Contracts:

In 1998 a total of 928 consulting contracts, inclusive of amalgamation, transition and restructuring consulting contracts, were issued by the Departments, Agencies, Boards and Commissions having a total value of $29,102,869.36 including all taxes.

Of this total, 760 contracts were issued by City Departments, representing 81.90 % of all contracts. These contracts had a total value of $18,945,496.59 representing 65.10 % of all expenditure on 1998 consulting contracts.

Of the total number of consulting contracts, 168 were issued by the Agencies, Boards and Commissions, representing 18.10 % of all contracts. These contracts had a total value of $10,157,372.77 representing 34.90 % of all expenditure on 1998 consulting contracts. This information is captured in Appendix B, Table 1.

Consulting Contracts Compared to Total Budget:

The $29,102,869.36 spent on consulting services in 1998 by City Departments and Agencies, Boards and Commissions represents 0.43 % of the total 1998 Capital and Operating Budget of $6.8 Billion (Operating being $5.6 billion and Capital being $1.2 billion).

Number of Firms and Relative Value of Contracts:

City Departments, Agencies, Boards and Commissions issued a total of 928 contracts for consulting services to a total of 424 different firms in 1998.

As shown in Appendix B, Table 2, in 1998 a total of 424 firms performed consulting contracts for the City Departments, Agencies, Boards and Commissions. A total of 106 firms or 25.00 % of the total number of firms receiving consulting contracts had contracts totalling $5,000.00 or less. A total of 288 firms or 67.92 % of the total number of firms receiving consulting contracts had contracts totalling between $5,000.01 and $250,000.00. A total of 17 firms or 4.01 % of the total number of firms receiving consulting contracts had contracts totalling between $250,000.01 and $500,000.00. A total of 12 firms or 2.83% of the total number of firms receiving consulting contracts had contracts totalling between $500,000.01 and $1,000,000.00. A total of 1 firm or 0.24 % of the total number of firms receiving consulting contracts had a contract totalling between $1,000,000.01 and $2,500,000.00.

Contract Values as a Percentage of Overall Consulting Expenditure:

As shown in Appendix B, Table 3, in 1998 there were 928 consulting contracts issued. Of these 374, or 40.30% of the contracts had an individual value of up to $5,000.00 for a total of $ 892,938.18 representing 3.07 % of the 1998 total gross consultant expenditure. Of the 928 consulting contracts issued, 538 contracts or 57.97 % of the contracts were valued at between $5,000.01 and $250,000.00 for a total of $19,880,557.18 representing 68.31% of the total gross consultant expenditure. Of the 928 consulting contracts issued, 10 contracts or 1.08 % of the contracts were valued at between $250,000.01 and $500,000.00 for a total of $3,328,384.00 representing 11.44 % of the total gross consultant expenditure. Of the 928 consulting contracts issued, 5 contracts or 0.54 % of the contracts were valued between $500,000.01 and $1,000.000.00 for a total of $3,290,990.00 representing 11.31 % of the total gross consultant expenditure. Of the 928 consulting contracts issued, 1 contract (issued by Toronto Transit Commission) or 0.11 % of the contracts was valued at between $1,000,000.01 and $2,500,000.00 for a total of $1,710,000.00 representing 5.88 % of the total gross consultant expenditure.

Purchase of Services:

The contracts included in this report are for consulting services only and do not include contracts for the purchase of services, such as soil testing, medical professionals, translation services, etc. made by City Departments, Agencies, Boards and Commissions.

Breakdown of Consulting Services Contracted in 1998:

City Departments:

Chief Administrator's Office issued 41 contracts, inclusive of amalgamation, transition and restructuring consulting contracts, for consulting services having a value of $2,997,749.55 including all taxes. Contracted consulting services for the Chief Administrator's Office include for the most part consultants for various Departmental amalgamation and rationalization of services studies, various corporate/strategic direction initiatives and concession operation review.

Community and Neighbourhood Services issued 133 contracts for consulting services having a value of $2,253,453.52 including all taxes. Contracted consulting services for Community and Neighbourhood Services include for the most part consultants for Homelessness Initiative Program, property management services, program modifications to the Tenant Management and Registry System, professional health services , technical consultants (i.e., mechanical, structural) for various properties and medical/dental/social programs.

Economic Development, Culture and Tourism issued 91 contracts for consulting services having a value of $875,597.42 including all taxes. Contracted consulting services for Economic Development, Culture and Tourism include for the most part consultants for playground health and safety, environmental strategies, landscape/design architects and technical consultants (i.e., engineering, architectural) for various properties.

Urban Planning and Development Services issued 13 contracts for consulting services having a value of $189,731.32 including all taxes. Contracted consulting services for Urban Planning and Development Services include for the most part consultants for tourism analysis, computer Licensing Information System, public relations, parking standards and task force on Taxi cab industry.

Works and Emergency Services issued 215 contracts for consulting services having a value of $8,300,542.40 including all taxes. Contracted consulting services for Works and Emergency Services include for the most part consultants for Keele Valley litigation, bio-solids program, technical consultants (i.e., engineering, geotechnical) for various properties, project design/supervision and soil investigation.

Corporate Services issued 164 contracts for consulting services having a value of $3,574,122.38 including all taxes. Contracted consulting services for Corporate Services include for the most part consultants for employee assistance programs, computer consultant for Records and Archives, arbitration/negotiation services, compensation study and technical consultant (i.e., architectural, mechanical) for various properties.

Finance issued 3 contracts for consulting services having a value of $754,300.00 including all taxes. Contracted consulting services for Finance include consultants for employee benefits review, unfunded liabilities evaluation and a development charges study.

Agencies, Boards and Commissions:

The decision to contract with consultants is an operational matter. In the case of most major City Agencies, Boards and Commissions, the Council has delegated to the Boards of Directors the authority to approve such matters. Council may, however, establish policy and required administrative practices for most Agencies, Boards and Commissions (excepting a few governed under separate statute).

Board of Governors of Exhibition Place issued 50 contracts for consulting services having a value of $945,504.92 including all taxes. Contracted consulting services for the Board of Governors of Exhibition Place include for the most part consultants for technical consultants (i.e., engineering, structural) for various properties, media planning, stadium demolition and landscaping.

Toronto Police Services issued 30 contracts for consulting services having a value of $505,171.45 including all taxes. Contracted consulting services for Toronto Police Services include for the most part consultants for benefit administration, labour relations, Y2K compliance, design consultant for Horse Palace, Workplace Safety Insurance Board and systems consultant for parking enforcement.

Toronto Transit Commission issued 49 contracts for consulting services having a value of $6,869,084.00 including all taxes. Contracted consulting services for the Toronto Transit Commission include for the most part consultants for technical consultants for various properties, traffic study/management, trackwork design, production and maintenance support for Materials Management Systems, computer/Y2K consultants and technical assistance for financial, payroll and human resource systems.

Toronto Zoo issued 14 contracts for consulting services having a value of $694,732.62 including all taxes. Contracted consulting services for the Toronto Zoo include for the most part consultants for capital funding review and analysis, technical consultants (i.e., architectural, engineering) for various exhibits/buildings and sponsorship sales.

The Hummingbird Centre for the Performing Arts issued 13 contracts for consulting services having a value of $91,211.07 including all taxes. Contracted consulting services for the Hummingbird Centre of the Performing Arts include for the most part consultants for development Department, technical consultants (i.e., electrical, fire curtain) for various projects and strategic planning.

Toronto and Region Conservation Authority issued 112 contracts for consulting services having a value of $1,051,668.71 including all taxes. Contracted consulting services for the Toronto and Region Conservation Authority include for the most part consultants for Legal plan review, technical consultants (i.e., engineers, architectural) for various properties and preparation and survey of reference plans.

Next Steps:

I will continue to report to the Policy and Finance Committee annually, on consultant activities of the previous year in order to keep the Policy and Finance Committee informed on the consultants contracted by City Departments, Agencies, Boards and Commissions.

In future reports, in addition to the details provided in Appendix 'A', attached, I will be able to separate the consultants contracted by City Departments, Agencies, Boards and Commissions into six major categories: Technical, Systems Development, Research and Development, Management, Legal and Communications.

It is not possible to separate the consultants contracted in 1998 into the aforementioned categories as the City Departments, Agencies, Boards and Commissions were not directed to compile information in this manner for consultants they contracted in 1998. I will instruct all City Departments and request all Agencies, Boards and Commissions to compile the information as categorized above for consultants they contract in 1999 and will include the details in future reports to the Policy and Finance Committee.

Future reports will also be able to compare the data on consulting contracts issued by City Departments, Agencies, Boards and Commissions from year to year. This will not only indicate the major categories of consulting services contracted by the City Departments, Agencies, Boards and Commissions but will also analyze any trends in the use of consultants by the City Departments, Agencies, Boards and Commissions.

Conclusion:

This report details the consulting services contracted by the City Departments, Agencies, Boards and Commissions during the year 1998 and should be received for information. I will continue to provide reports to the Policy and Finance Committee each year on an ongoing basis to report on the consulting services contracted by City Departments, Agencies, Boards and Commissions and to compare the contracting of consulting services activity to previous years activity.

Michael R. Garrett

Chief Administrative Officer