June 1, 1999
To:Community Services Committee
From:Commissioner of Community & Neighbourhood Services
Subject:Capital Loan Guarantee for Earl Haig Community Day Care Centre
to Develop a Child Care Centre
Purpose:
The purpose of this report is to seek Council approval for the City of Toronto to provide a loan guarantee for Earl Haig
Community Day Care Centre to develop a child care centre.
Funding Sources, Financial Implications and Impact Statement:
The former Metropolitan Toronto Council established Criteria for Capital Loan Guarantees for non-profit child care
programs in the report "Capital Loan Guarantee for John Wanless Child Care Program" adopted June 1, 1994. This report
proposes that the City of Toronto guarantee a loan of $1 million for the development of a child care program at 1671
Queen Street. While the City would not be providing direct funding to this project the City would need to meet
requirements for certification under the established debt and obligation limit.
Recommendations:
It is recommended that:
1) subject to sufficient performance safeguards, the City of Toronto guarantee a capital loan of up to $1,000,000 to be
arranged by Earl Haig Community Day Care Centre;
2) the nature and terms of the guarantee, including any requirement for potential certification under the established debt
and obligation limit, be subject to the concurrence of the Treasurer, City Solicitor and the Commissioner of Community
and Neighbourhood Services; and
3) the appropriate City Officials be authorized to take the necessary action to give effect thereto.
Council Reference/Background/History:
Earl Haig Community Day Care Centre is proposing to develop a new child care facility named the Beach and Child
Family Centre at 1667-1671 Queen Street East. The proposed centre will serve 113 children from birth to school age. Earl
Haig Organizations currently operates the Earl Haig Community Day Care Centre which serves 136 children from birth to
12 years of age. The organization has a history of 18 years of service to the community and has had a subsidy contract with
the municipality since 1981.
The proposed new location offers the opportunity to significantly increase the service available to infants and toddlers. The
organization, while operating in a fiscally solvent position does not have sufficient funds to pay for the construction costs
of the new facility. The Province of Ontario no longer funds major capital costs of child care development. As a result,
there have been significant barriers to the growth of child care services in support of the principles of service equity.
The former Metropolitan Toronto Council approved loan guarantees for Allenby Day Care Centre, John Wanless Child
Care, and Charlottetown Blvd Child Care and established criteria for Capital Loan Guarantees in a report adopted by
Council June 1, 1994
Comments and/or Discussion and/or Justification:
The Earl Haig organization has submitted a business plan to the Department in support of its application of a City Loan
Guarantee. The construction costs will be funded through a loan and the loan payments will be financed through parent
fees. In order to successfully obtain a loan from a commercial lender, the organization requires a loan guarantor. A
preliminary review by Departmental officials of the centre's financial plan has been completed. Further discussions with the
operator and the Treasurer will continue to refine the business plan but the preliminary analysis indicates that the plan is
viable.
It is expected that this project will meet the established criteria for loan guarantees.
Conclusions:
The Department recommends that Council approve a loan guarantee for Earl Haig Community Day Care Centre subject to
sufficient safeguards and in accordance with the established criteria.
Contact Name:
Brenda Patterson
Director, Contract and Quality Compliance
Children's Services Division
Tel.: 392-3319
patterso@csis.csis.csd.metotor.on.ca
General Manager of Children's Services
Commissioner of Community & Neighbourhood Services
