COUNCIL MEETINGO 9 APR - 7 '09

0 f ORIGINAL SIGNED BY DIRECTOR OF FINANCIAL SERVICES

Stephen Dickey, Deputy Treasurer

CITY OF KINGSTON

REPORT TO COUNCIL

FlCER

I Report No.: 09-1 15 1

Commissioner Beach, Sustainability & Growth

Commissioner Thurston, Communify Development Services

TO:

FROM:

RESOURCE STAFF:

Mayor 8t Members of Council

Gerard Hunt, Chief Administrative Officer

Stephen Dickey, Deputy Treasurer

DATE OF MEETING: 2009-04-07

SU 6 J ECT: 2009 Budget Update - Agencies and Boards

NIR NIR

EXECUTIVE SUMMARY: When the 2009 operating budget was approved in December 2008 budget estimates were approved for boards and agencies that had not yet submitted their final budgets and that were in the process of completing the 2009 budgets with their respective agency or board. The city has now received these formal requests, This report is provided to update council on the final requests for those agencies and boards. The following commentary explains how these requests will fit within the budget envelopes that have been approved by council without a further increase to the tax requirement for 2009.

RECOMMENDATION: That the final budget requests for those agencies and boards reported herein be received;

That the 2008 surplus associated with services provided by the County of Frontenac be allocated to the 2009 operating budget to close the identified funding gap as presented in this report.

AUTHORIZING SIGNATURES:

CONSULTATION WITH THE FOLLOWING COMMISSIONERS:

I Commissioner Leger, corporate Services I NIR I ~ ~~

Jim Keech, President, Utilities Kingston 1 NIR

COUNCIL MEETINGO 9 APR - 7 '09 REPORT TO COUNCIL

April 7,2009 -Page 2 -

Report No.: 09-115

OPTIONSIDISCUSSION:

The following summarizes the additional information that we now have on the agency budgets.

Cataraqui Region Conservation Authority (CRCA)

The CRCA has submitted its final 2009 municipal budget of $1,533,068. The city's share of the municipal levies is $930,093. This amount generally matches the envelope established by council at $930,090. No adjustment is required for the minor difference.

KFL&A Public Health

The KFL&A board of health approved its 2009 budget on January 28, 2009. The city's share of the overall budget is $3,255,685. This amount is within the approved budget envelope of $3,297,442. It is not necessary to adjust the city's budget now as the surplus of $41,757 will contribute to a savings pool in 2009. This will assist the municipality with budget pressures which may be experienced as a result of the current economic circumstances.

County of Frontenac

Land Ambulance

The county has submitted its 2009 approved budget in the amount of $6,587,075, an increase of .14% from 2008. The city's share of the budget is $5,353,645. The budget envelope is approved at $5,204,487, leaving a gap of $149,158. The county has indicated that it will work with city staff to forecast future year's financial requirements to enable both parties to plan accordingly for budget purposes. We expect that the requests in those years will be below the current year level, mainly due to a move towards a more systematic approach to capital expenditures. This will give us the ability to manage the impact on tax levels.

Fairmount Home

The county has submitted its 2009 budget in the amount of $2,617,537 of which the city's share is $1,779,925. The budget envelope is $1,538,717. The difference of $241,208 is largely made up of capital projects in the amount of $299,238. In 2008 no capital projects were included in their budget. This capital requirement is considered an exception in its magnitude, with future year capital expenditures likely to be much lower. The county has indicated that similar to Land Ambulance it is their intention to work with city's finance staff to develop longer term financial planning forecasts to assist in smoothing financial requirements in the coming years.

The gaps noted above ($149,158 and $241,208) totaling $390,366 can be offset by a 2008 year end surplus of approximately $387,000 for county related services. This will be reported as part of the 2008 year-end report and the 2008 audited financial statements.

EXISTING POLICYIBY LAW:

Not applicable

NOTICE PROVISIONS:

Not applicable

REPORT TO COUNCIL April 7,2009

-Page 3 -

CQUNCIL MEETINGO 9APR - 7 '09 Report No.: 09-115

ACCESSIBILITY CONSIDERATIONS:

Not applicable

FINANCIAL CONSIDERATIONS:

Financial information is included in the body of this report.

CONTACTS:

Not applicable

OTHER CITY OF KINGSTON STAFF CONSULTED:

Not applicable

EXHIBITS ATTACHED:

Appendix A - CRCA 2009 Budget Appendix B - KFL&A 2009 Budget Appendix C - County of Frontenac 2009 Budget Appendix D - Downtown Kingston! BIA Levy Estimation 2009

Report 09-115 Appendix A

COUNCIL MEETINGO 9 APR - 7 '09

2009 Budget Summary

Sugar Bush at Little Cataraqui Creek Conservation Area

CATARAQUI REGION CONSERVATION AUTHORITY 1641 Perth Road, EO. Box 160 Clenburnie, Ontario KOI-I 1 SO Phone: (61 3 ) 546-4228 Toll-free (4'1 3 area code) 1 -877-956-CRCA Fax: (613) 547-6474 E-mail: ar:a@c~aatarayuirepion.on.ca Websites: wLvw.c:atarayuircgioti.~~ii.~~ and www.cIeanwatercataiaqui.ca

LUUNLIL Mt;tIINbU Y HrK - / u7

Cafuraqu; Region consemat;on Autho&y - 2009 Budget (Summary)

Municipal Governments General Levy Municipal Governments Special Levy User Fees Other Revenue Provincial and Federal Grants

Total

1 Part D Watershed Stewardship Services I

$1 ,I 92,226 $1 81,562 $456,100 $460,405 $1 16,734

$2,407,02 7

B-2a DWSP Operations Expenses

Revenues (1 00 % Provincial funding)

$625,950

$625,950

February 2009

LUUNLIL MkklINbU YHI'K - / U7

Cahm~qui Region Consenafion Au#botZ#y - 2009 Budge9 ISummarvl

Grants Other Revenues donations, partners and land owners

Total

Regular Project Expenses

$74 1,200 177,500

$1,070,480.00 T r i

February 2009 - 7

COUNCIL MEETINGO 9 APR - 7 w

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Report 09-115 Appendix B

TO: Steve Fox, L & A. County

r FEB 0 3 2009

Elizabeth Savill, County of Frontenac Gerard Hunt, City of Kingston

i P.

FROM: Shannon Hegarty, Financial Officer

DATE: January 29,2009

SUBJECT 2009 Budget Approval

This will confirm that, at its meeting of 28 January 2009 the KFL&A Board of Health approved the 2009 budget. The total budget approved for 2009 was $13,347,428, This represents an overall increase of 3.06% over the budget for 2008 without the Syndromic Surveillance budget included, as it is now 100% fbnded by the ministry. This means a 3.0% increase to the provincial component of the shared budget and a 1.69% increase to the municipal component. The budget increase accounts for negotiated wage and benefit increases, plus addressing other smaller budgetary pressures.

You will recall that once the Board of Health approves the annual mandatory programs portion of the total budget, the municipalities are advised of the cost of supporting KFLA Public Health and, at the same time, a request is made to the provincial Ministry of Health and Long Term Care to provide a grant in support of the budget. Consequently, the total municipal share for the 2009 budget year is $4,936,423.

The amounts allocated to the respective funding municipalities are as follows:

Municioality Municipal Role % 2008s 2009 Amount

Lennox & Addington 35,629 21.30 $1,033,853 $ 1,051,391 Kingston 1 I0,3 27 65.95 $3,201,378 $3,255,685 Frontenac 21,327 12.75 $ 618,849 $ 629,347

These amounts are exclusive of other Health Unit programmes that are 100% funded by’ the provincial Ministry of Health and Long Term Care and other sources. For information purposes, funding for these programmes amounts to an additional $4,838,569.

KTNGSTON, FRONTENAC AND LENNOX & ADDINGI’ON PUBLIC HEALTH

COUNCIL MEETINGU Y APK - 7 w

2

I have also attached the summary sheets for this year’s budget. I trust that this letter provides the information you require for your budgeting purposes. The Board of Health has asked us to contact the municipal treasurers to discuss the appropriate amount for a reserve fund. We will be contacting you shortly to set up a meeting. Should you require any further information, please do not hesitate to contact me at 549-1232 Ext. 1242 or Tony Button at ext. 1265.

Yours truly,

Shannon I&& Financial Officer

C.C. Dr. I. Gemmill T. Button

I

COUNCIL MEETINGO 9 APR - 7 ‘09

2009 COST- SHARED BUDGET

PROVINCIAL CONTRIBUTION (EST.P/o) see note below

MUNICIPAL FUNDING

$1 3,347,428

$8,411,005 0.63

4,936,423 0.37

MUNICIPAL % Of The S VALUE $ increase % +J- ROLL Munlc. Portlon over 2008

LENNOX & ADDINGTON

KINGSTON

FRONTENAC

3,629 21.30% S1,051,391 17,538 1.69%

110,327 65.95% $3,255,685 54,307 1.69%

MOHLTC Cost Shared Programs Mandatory programs 8,31S,629 Vector- Borne Diseases (VED) 95,376

Total 8,411,005

100 % MOHLTC Funding Research & Education (PHRED) 274,692 fnfection Control 51 1,500 Children In Need of Treatment 146,992 Small Drinking Water Systems 245,800

Syndromic Surveillance Project 11 5.000 - prior year shared funding

TOW Provincial Grant 9,704989

COUNCIL MEETINGO 9 APR - 7 UY

CHRONIC DISEASE & INJURY PREVENTION ADULT HEALTH Salaries and Benefits Operating

CHRONIC DISEASE & INJURY PREVENTION: SCHOOL HEALTH & TOBACCO Salaries and Benefits Operating

FAMILY HEALTH Salaries and Benefits Operating

DENTAL PROGRAM Salaries and Benefits Operating Children In Need of Treatment

INFECTIOUS DISEASE PREVENTION Salaries and Benefits Operating Needle Exchange Program Transfer

ENVIRONMEMAL HEALTH Salaries and Benefits Operating

RESEARCH AND EDUCATION Salaries and Benefits Operating

TOTAL BUDGET FOR OPHS PROGRAMS

1,755,267 137,780

1,619,634 72.202

1,289,873 66.075

460,771 18i8OO

230.000

1,615,326 24,537

219.320

1,893,047

1,691,836

1,355,948

709,571

1,859,183

780,969 12,531

793,500

691,673 22,459 71 4,132

$ 9,017,217

COUNCIL MEETINGO 9 APR - a '09

OFFICE OF THE MEDICAL OFFICER OF HEALTH Salaries and Benerds 624,195 Operating 20.098

CORPORATE SERVICES Salaries and Benefits Operating

TOTAL CORPORATE SERVICES

TOTAL PROGRAM AND CORPORATE SERVICES

Legal Fees Board Honoraria Board Conferences Board Travel Staff Association Donations Remembrances & Annual Meeting

TOTAL BOARD COSTS

1,691,041 350,100

644,293

2,041,141

2,685,434

11,702,651

40,000 7,000 3,600 2,000 2,500 5,000 5,000

COUNTY OF FRONTENAC 2009 Budget

128,728 601,647 472,919 367.38q 0 0 0 100,00?~

-104,651 -488,989 -384,338 367.26% -24,077 -1 12,658 -88,581 367.90%

100.00% 0 . O 0 .... .-

' .:,;: : ".?;

L< I

. . . . . . . . . . . 'i,,

3 IO ;

100.00%; . . 0 0 212,000 405,000 193,000 91 .we/, 79,250 127,500 48,250 . 60.88%

291,250 532,500 241,250 ' 82.83%

0 0 , Q O.OQP& 232,000 405,000 173,000 74.5iyf

10,000 200,000 r9b;doo . . . . . 1900.06@

Land Ambulance Services 2008-2009 Budget

2008 Budget 2009 Budget Variance $ s $ %

LAND AMBULANCE SERVICES REVENUE

Provlndaf -Ministry of Health and Long Term Care 5,900.026 6,120,657 220,631 3.74% Sale of Vehicles and Defibrillators TOTAL Revenue

25,000 11,000 -14.000 -56.00% 6,s 2 5,O 2 6 6,131,667 206,631 3.49%

EXPENSE Service Delivery (2008 Includes Approved Enhancement) 11.287.301 1 1,616,146 328,845 2.91 % Cross Border Transfer I Other Projects Reserve Transfer - Vehicle Replacement Reserve Transfer - Equipment Rep\acement Reserve TOTAL Direct Service

Net Operating Expense

0 0 0 0.00% 0 175.000 175,000 100.00%

348,000 355,500 7,500 2.16% 164,750 248,655 83,905 50.93%

11,800,051 12,395,301 595,250 5.04%

5,875,025 (5,263.644 388,619 6.62% Net Capital Expenditure - New and 2008 projects 702,670 217,020 -485,650 -69.11% TOTAL Ambulance before Enhancement 6,577,695 6,480,664 ':9+,03'1;j: ;>,xi., > , -1.48%

., . . . . . .

Enhancement 0 106,411 106,411 100.00% , . . '. ,. .....

Net Ambulance with Enhancment 6,577,696 6,687,075 9,379 . 0.14% J . . . . ~ . .

City of Uingston 81.275% est 5,384,436 5,363,645 -30,%91 -0.57% . . . . . . . . . . . .....

Frontenac 18.725% est ( 18.141% in 2008) 1,193,260 1,233,430 40,170 3.37%

Ambulance Capital 2008 Projects Brought Forward Transfer from Reserve City of Kingston - Retained Surplus County - Transfer from Working Capital Reserve Net 2008 Project Brought Forward

Revenue Ministry Funding MECF funding Transfer - Vehicle Replacement Reserve Transfer - Equipment Replacement Reserve

Expenditure Vehide - New Vehcile - Replacment Equipment - New Equipment - Replacement 89,250 127.500 38,250 42 86%

331,250 732,500 401,250 121 .I 3%

Major Capital Projects 662,670 0 -662,670 -1 00.00% Shared Projects 0 17.020 17,020 100 00% Net Capital 702,670 217,020 -485,650 -69.11%

i i

Page 18 , I

February 11, 2009 .f'=

COUNCIL MEETINGO 9 APR - 7 '09

COUNTY OF FRONTENAC 2009 Budget

Fairmount Home for the Aged

Summary of Revenue and Expenditures

Revenue Provincial - Operations Provincial - Nurse Practitioner Provincial Subtotal

Residents - Accommodation Fees

Revenue Subtotal Before Municipal Contribution

Transfers - RQSeNeSfReSeNe Funds

Current Expense

Program and Support Services Direct Nursing and Personal Care Nurse Practitioner Nursing and Personal Care Adminisiration Raw Food Dietaly Services Housekeeping Services Laundry and Linen Services Building and Property Facility Costs General and Adrninislrative Current Expense Subtotat

Capital Expenses

HeatinglWater System Capital Projects (MECF) City Share of Surplus Retained County Share of Surplus Retained

Total

2008-2009 Budget 2008 Budget 2009 Budget Variance

4362,224 4,688,612 326388 7.4aq0 58,325 60,075 ? ,750 3 00%'

4,420,549 4,748,687 328,138 7.42%

2,700,737 2,753,064 52,327 1.94%

7,121,286 7.501,751 380.465 5 34%.

12,150 5,200 -6,950 -57 20%

381,995 41 2,151 30,l 7 89% 3,986,366 4.287,768 301,402 7.56%

109,937 11 5,534 5.597 . 5.09% 1,280,210 1,227,819 -52,391 -4 09%

327,040 334.048 7,008 2 14% 833,940 883,322 49,382 552,225 544,738 210,510 206,935 416,656 492,890 371,933 383,951 12,018 3 23% 873,090 859,274 -13,815 -1 58%

9,343,903 9,748,430 404,527 4 33%

* ,

62,800 90,200 27,400 43.63%

0 299,238 299,238 100.00% ,-100.00% 0 -9,098 -9,098

0 -4,282 -4,282 -'IOO.OO% 9,406,703 10,124,488 717,785 7.63%

Municipal Contribution 2,273,267 2,617,537 344,270 1 5.1 4% City of Kingston Share 1,545,821 I .779,925 234.104 15 14% County of Frontenac Share 727,445 837,612 110.166 15.14%

Page 20 February I I , 2009

COUNCIL MEETINGU Y AI" - / UY Report 09-115 Appendix D

~ O W ~ ~ O W N KINGSTON!

Levy Estimation 2009

D FIC

2390 Flowers $39,605

2690 Street Decorations $43,207

3630 Downtown Maintenance $20,603

Subtotal

$1 52,685

2334 Meetings, Planning & Training $8,660

251 0 Office Supplies & Miscellaneous $1 2,975

3010 Occupancy - Office Rent & Utilities $42,595

3520 Professional Services, Fees, Subscriptions $12,210

2650 Office Equipment & Services $1 7,360

7030 Contingencies $5,095

3340 Special Events $1 35,500

3340 Market Square Based Events & Programs $91,000

3591 Salaries/Benefits, Professional Development $85,500

OMlC DEVE 10 SalarieslBe

361 0 Recruitment $14,000

361 0 Retention $22,000

361 0 Growth/Municipal Liaison $1 5,000

Subtotal $1 18,720

. . .Admin\Accounting\Budgets ReportsY2009P009 Levy Estimation.xls

Approved by the Board of Management of Downtown Kingston, December 10, 2008

COUNCIL MEETINGO 9 APR - 7 ’09

Commissioner Beach, Sustainabilify 8, Growth

Commissioner Thurston, Communify Development Services

Commissioner Leger, Corporate Services

Jim Keech, President, Utilities Kingston

COUNCIL

~~~~~~ ~

NIR

NIR

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Uti I it ies Kingston I Report No.: 09-132 I

TO: Mayor and Council

FROM:

RESOURCE STAFF:

Jim Keech, President and CEO, Utilities Kingston

Jim Keech, President and CEO, Utilities Kingston

DATE OF MEETING: 2009-04-07

SUBJECT: Naming Conventions for Water Treatment Facilities

EXECUTIVE SUMMARY:

At the Council meeting of March 3, 2009, Council approved the naming of the sewage/waste water plants as ‘Waste Water Treatment Plants”. Following this approval, Council questioned if the name of “water treatment plants” should be changed to avoid confusion. After discussion with staff in the treatment group, we are recommending these facilities continue with the name ABC ‘Water Treatment Plant”.

RECOMMENDATION:

THAT facilities used to produce potable water will have the suffix Water treatment plant”; and

THAT the following names be approved: Point Pleasant Water Treatment Plant, King Street Water Treatment Plant and Cana Water Treatment Plant and City Gate Regulating Station.

AUTHORIZING SIGNATURES:

ORIGINAL SIGNED BY PRESIDENT& C.E.O., UTIUTI& KlNGSiON Jim Keech, President and CEO, Utilities Kingston

ATlVE OFFICER CONSULTATION WITH THE FOLLOWING COMMISSIONERS:

REPORT TO COUNCIL. 2009-04-07 - Page 3 -

COUNCIL, MEETINGO 9APR - 7 '09 Report No.: 09-132

OPTlONSIDlSCUSSlON :

The Executive Summary is self-explanatory.

EXISTING POLICYIBY LAW: NIA

NOTICE PROVISIONS: NIA

ACCESSIBILITY CONSIDERATIONS: NIA

FINANCIAL CONSIDERATIONS: NIA

CONTACTS: Jim Keech, President and CEO, Utilities Kingston - 613-546-1 181, Extension 2217

OTHER CITY OF KINGSTON STAFF CONSULTED: NIA

EXHIBITS ATTACHED: NIA

COUNCIL MEETINGO 9 APd - 7 j09

I e

,A rn CITY OF KINGSTON L= REPORT TO COUNCIL - I ReDortNo.: 09-128 1

TO:

FROM:

RESOURCE STAFF:

DATE OF MEETING:

SUBJECT:

Mayor and Council

Denis Leger, Commissioner, Corporate Services

Speros Kanellos, Director, Real Estate & Construction Services

April 7,2009

Municipal Accommodation Strategy

EXECUTIVE SUMMARY:

This report seeks Council’s approval to pursue the city’s Master Accommodation Plan (MAP) for permanent accommodation. Given that the city is in the third year of a five year lease term in the British Whig Building, the city is at a decision point on whether or not to proceed now to implement the recommendations of the MAP, which called for an administrative centre owned by the city to be secured in the downtown core within a short distance of City Hall. The MAP recommends that in order to fill all medium to long term space requirements, the city pursue ownership space options rather than conventional lease arrangements.

This report further outlines the timing, financial and process considerations for moving forward, and an analysis of the’risks of proceeding now versus in 2012. Staff is recommending the commencement of an RFP process and the allocation of capital budget to pursue this strategy that will take the city from leasing to owning an administrative centre.

In the strategic planning session of Council held in September 2008, the major projects report forecasted this expenditure to occur in 2010. The timing associated with the recommendations in this report coincides with that forecast and does not compromise the city’s financial capacity to proceed with other identified major projects. The report is before Council at this time due to the time sensitivity of exploring options.

In addition, during its upcoming 2009/2010 capital budget deliberations, Council will be presented with concept plans for the phased-in construction of a new operationslfleet facility at 701 Division Street and the expansion of the administrative/operations facility at 121 1 John Counter Boulevard.

RECOMMENDATION:

THAT Council direct staff to develop and issue an RFP for a turn-key design-build project to accommodate the city’s main administrative offices in city-owned space; and

REPORT TO COUNCIL.

Commissioner Thurston, Community Development Services

Commissioner Leger, Corporate Services

COUNCIL MEETINGO 9 APR - 7 '09 Report No.: 09-128

d ,/

April 7,2009 - Page 2 -

~ ~ ~ ~~

Jim Keech, President, Utilities Kingston

THAT Council approve a initial budget of $500,000, funded from the municipal capital reserve fund, for project management, architectural, engineering and cost consultants, legal fees, in-house project management and contingency allowances to be incurred from now until the signing of the design-build contract; and

J

THAT the upcoming capital budget for 20091201 0 include sufficient allocation for the project.

AUTHORIZING SIGNATURES:

1 ORIGINAL SIGNED BY COMMISSIONER I Denis Leger, Commissioner, Corporate Services

O R I S 1 6 N F n V E OFFICER Gerard Hunt, Chief Administrative Officer

CONSULTATION WITH THE FOLLOWING COMMISSIONERS:

Commissioner Beach, Sustainability & Growth

(N/R indicates consultation not required)

COUNCIL MEETINGO 9 APR - 7 ‘09 REPORT TO COUNCIL. Report No.: 09.128

April 7,2009 - Page 3 -

OPTIONSIDISCUSSION:

The following sections of this report summarize the history of the Master Accommodation Plan (MAP) recommendations, lease vs. ownership options as well as timing & process considerations, risk management and financial strategy.

Histow: The City of Kingston approved the recommendations of the MAP on February 3,2004, with the following motions passed by City Council:

THAT City Hall be retained and repurposed to accommodate governance and greafer public use, and; THAT an administrative centre of approximately 60,000 sq. ff. be developed in the downtown core, and; THAT the Montreal Sfreef facilify be configured fo handle all social service functions, and; THAT the Counter Sfreef facilify be retained with its core purpose as fhe locafion of Ufilifies Kingsfon and Customer Service Centre, and; THAT the Midland Avenue facilities be prepared for sale in the next 3 to 5 years, and; THAT staff be direcfed fo invesfigafe the feasibilify, time lines and fhe financial plan associafed with achieving the above recommendations for Council’s considerafion.

In 2006 the city proceeded to move towards an interim strategy, which was consistent with the long term strategic direction of the MAP. The interim strategy focused the general administrative functions of the municipality in the downtown core and created a development hub at 121 1 John Counter Boulevard.

In order to meet the objective for an administrative centre in the downtown core, the city, through a competitive process, entered into a lease agreement to occupy three floors of the British Whig Building (BWB). Accordingly, certain functions at City Hall were relocated to the BWB. Concurrently, the city’s Midland Avenue offices were closed and its functions were relocated to the John Counter Boulevard development hub and the BWB. The leasing of the British Whig Building brought the city one step closer to its long term strategic direction of developing and owning an administrative centre in the downtown core.

City Hall is a national historic site and a heritage showpiece for the city. Its central location is convenient for councillors and citizens, and supports the city’s downtown core vision. The MAP recommended that City Hall be repurposed to focus on three primary functions: governance, governance support space and public uselmeeting space. Governance, for the purpose of the MAP report, includes the offices of the Mayor, Chief Administrative Officer and Commissioners, their support staff, Council Chambers and the Clerk and Legal Departments. Through a functional programming exercise, staff and Council will have the opportunity to revisit these principles.

Lease vs. Ownership

In May 2006, Council authorized the Mayor and Clerk to execute an agreement with Kincore Holdings Ltd. for the leasing of 24,087 sq. ft. of office space at the British Whig Building (BWB), at an annual base rent of $14 per sq. ft. for a term of five years starting September 1 , 2006, with options to renew for two additional five-year terms.

As the city is currently in its third year of the five year lease agreement at the BWB, which expires on August 31, 201 1 , Council may now wish to pursue the development of permanent administrative accommodations, rather than exercise a five-year option to renew in the year 201 1 that would run until August 2016.

Pursuant to the terms of the lease, the city has two options to renew. The first renewal option is for a second term of five years with an increase in lease cost from the current net rate of $14 per square foot to $18 per square foot. The second renewal option is for a third term of five years at $22 per square foot.

COUNCIL MEETINGO 9 APR - 7 ’09 Report No.: 09-128 REPORT TO COUNCIL.

April 7,2009 - Page 4 -

The City’s Master Accommodation Plan (MAP) recommended that the city acquire ownership of its administrative space. This recommendation was based on the long term financial benefit of owning property rather than leasing. Ownership would also provide the opportunity for environmental benefits of a LEED building, and a higher level of accessibility than might otherwise be available through a lease.

The current rent at the BWB would be used to pay down part of the debt in a city-owned facility. It is in the city’s best long-term interest to own its own administrative facility based on the stability of known long-term financial commitments of debt issuance and equity. Ownership would also provide the benefits of corporate identity and civic presence through building signage and better control over facility design, image and maintenance. A city-owned facility in the downtown ensures a stable long-term location.

Timing & Process Considerations Staff has determined that there are two options - to continue to lease for now and exercise the first 5-year renewal option in 201 1 or to actively begin the process of having dedicated space built to accommodate our downtown administrative needs.

The two options are summarized as follows:

Option 1 : Council opts to postpone the project and continue to lease for now: 0 No further action is required at this time. 0 Before February 28th, 201 1 , exercise the 5-year lease renewal option at the BWB. 0 In 2012, reconsider the strategy of leasing or owning our downtown municipal accommodations.

Option 2: Council opts to pursue an ownership strategy: 0 The time constraints would require immediate action in order to avoid having to exercise the first 5-year lease option in

the BWB. Hire appropriate professional expertise on a sole-source basis as required to meet the timelines and as per the provisions of the purchasing bylaw. The consultants, in cooperation with staff, will develop the detailed program requirements and design standards, the RFP documents, the contract documents and a preliminary budget and schedule, and evaluate the RFP submissions. Costs for this scope of work and the additional in-house project management costs are estimated at $500,000. All consulting contracts will be in phases. The detailed program requirements and design standards will include:

o The project vision o Artist’s renderings o Current and long-term floor area requirements. Planning will be to a 40 to 50-year time horizon. o Space planning and adjacency diagrams o Detailed room requirements o Specifications for furniture, fixtures, materials & finishes, power & communications, signage, AN, security o Standards for structural, mechanical and electrical systems, elevators, landscape and civil site work o Accessibility standards o LEED requirements.

Issue an RFP in the fall of 2009 for a turn-key design-build project based on the detailed program of requirements. In order that the August 201 1 deadline not disqualify certain projects or properties that would take longer to develop (such as the North Block properties) swing space may be required. Handle the RFP as a two-stage process. In stage 1, the proponents present their team’s qualifications, along with a preliminary design and budget. In stage 2, the shortlisted proponents present more in-depth work to help in the evaluation process.

0 Evaluate the proposals;

0

REPORT TO COUNCIL.

COUNCIL MEETINGO 9APR - 7 ’09 Repofi No.: 09.128

April 7,2009 - Page 5 -

Subject to Council approval, contract with the successful proponent for the turn-key project by December 2009. 0 Depending on the time frame, to proceed with a standard design and construction process, or fast track it by

overlapping phases wherever possible. 0 Staff will develop a contingency plan in case the new space is not available by August 201 1.

The entire RFP process, including the procurement of consultants, programming, space planning, design development, specifications, proposal call, evaluation of proposals, negotiation and contract signing, is expected to take 8 to 9 months. With an April 2009 start, the City should be in a position to issue an RFP in the fall, and sign a contract with a designlbuild proponent by December 2009. The length of time needed for design, permits and approvals, site work and construction will depend on the selected site as well as the size and complexity of the project.

Risk Management There are risks to proceeding now, and also risks to waiting.

If the City proceeds now and any slippage in the schedule occurs at any stage of the process this will result in the new space not being ready when the current BWB lease expires. Should that occur, the City would have to either exercise the 5-year lease renewal option or find temporary accommodations.

If the projected is postponed until 2012 some of the options for suitable accommodation close to City Hall may no longer be available.

Financing Strategy It is estimated that the cost associated with this project will be in the $300 per square foot range. The estimated requirement of 40,000-50,000 square feet will mean a total expenditure in the range of $12,000,000 to $15,000,000. The financing strategy will include a combination of pay as you go financing from reserve funds and the issuance of long term debt. Assuming the issuance of $10,000,000 in long term debt financing, which is well within the city’s debt capacity, an annual payment of approximately $650,000 would be required. The city currently pays approximately $340,00O/year for approximately 24,000 square feet in rent at the BWB. If the City were to exercise its first five-year renewal option in 201 1 , the annual lease payment would increase to approximately $450,000.

In the strategic planning session of Council held in September 2008, the major projects report forecasted this expenditure to occur in 2010. The timing associated with the recommendations in this report coincides with that forecast and does not compromise the city’s financial capacity to proceed with other identified major projects.

EXISTING POLlCYlBY LAW:

There is no existing policy or by-law with this report.

NOTICE PROVISIONS:

There is no notice provisions required for this report.

ACCESSIBILITY CONSIDERATIONS:

The City needs to determine the accessibility standards to be included in the detailed program of requirements in the RFP. Consideration should be given to using the City of London accessibility standards for new construction. These standards are

COUNC~L MEETINGO 9 APR - 7 '09 REPORT TO COUNCIL. Report No.: 09-128

April 7,2009 - Page 6 -

ACCESSIBILITY CONSIDERATIONS:

The City needs to determine the accessibility standards to be included in the detailed program of requirements in the RFP. Consideration should be given to using the City of London accessibility standards for new construction. These standards are based on universal design principles, and go well beyond the requirements of the Ontario Building Code. They have been adopted by several other municipalities.

FINANCIAL CONSIDERATIONS:

It is in the city's best long-term interest to own its own administrative facility based on the stability of known long-term financial commitments of debt issuance and equity. The current base rent of approximately $340,00O/year at the BWB, which in 201 1 would increase to approximately $450,000 could be used to pay down part of the debt on a city-owned facility.

The cost of the work required to take us from now to the award of a design-build contract is estimated at $500,000. The budget includes fees for project management, architectural, engineering and cost consultants, legal fees, in-house project management, and contingency allowances.

CONTACTS:

Speros Kanellos, Director, Real Estate & Construction Services Debra Krakow, Project Manager, Real Estate & Construction Services

61 3- 546-4291 ext. 31 33 613-546-4291 ext. 3120

OTHER CITY OF KINGSTON STAFF CONSULTED:

Alan McLeod, Senior Legal Counsel Lanie Hurdle, Director of Recreation & Leisure Services Sheila Kidd, Director of Corporate Assets Operations Nancy Taylor, Vice President of Utilities Kingston

EXHIBITS ATTACH ED:

None