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HomeMy WebLinkAboutCS 16-02 CiÚI o~ 78 REPORT TO THE FINANCE & OPERATIONS COMMITTEE Report Number: CS 16-02 Date: August 6, 2002 From: Gillis A. Paterson Director, Corporate Services & Treasurer Subject: Establishment of the Ontario Transit Renewal Reserve Fund (OTRRF) Recommendation: It is recommended that Report CS 16-02 from the Director, Corporate Services & Treasurer be received and that: 1. Council authorize the submission by the Ajax Pickering Transit Authority (APT A) to the Provincial Ministry of Transportation for funding under the Ontario Transit Renewal Program; 2. Council approve the establishment of the Ontario Transit Renewal Reserve Fund; 3. the Mayor and Clerk be authorized to execute any agreements between the Province of Ontario and the City of Pickering related to the Ontario Transit Renewal Program; 4. the attached By-Law be read three times and passed; and, 5. the appropriate officials of the City of Pickering be authorized to take the necessary actions to give effect thereto, Executive Summary: Not applicable Financial Implications: The receipt of this grant for one third funding for these vehicles will have a positive impact upon the 2002 financial picture for APT A and the participating municipalities. At the time of reviewing the 2002 budget none of several potential sources of external funding could be confirmed. Therefore, the 2002 Budget for APT A included the expenditures for these vehicles and the funding from the municipalities from the redirected GO Transit funding transferred from the Region of Durham to Pickering and Ajax. Report CS 16-02 Date: August 6, 2002 79 Subject: Establishment of the Ontario Transit Renewal Reserve Fund Page 2 Now that we are reasonably certain of funding for these vehicles under this program application to the Ministry of Transportation can now be made. If successful, it will mean that less funds need to be transferred from Pickering to APT A leaving money in the Transit Reserve to assist in funding the 2003 capital requirements for APTA. Background: In January of this year, the Province released its report entitled "Strategic Transportation Directions" that outlined its transportation strategy for the Central Ontario region. The Province's report acknowledged the importance of transit as a crucial element to the Province's economic success and also stated that the Province is committed in providing $9 billion investment over ten years for transit funding. Under this program, Ajax Pickering Transit Authority (APTA) will receive one third funding for the purchase of any public transportation vehicle or for any major vehicle refurbishment. For this program, a "public transportation vehicle" is defined as a street car, bus or trolley bus used for public transportation. As the program title indicates, this program can only be used for transit vehicle replacement and not for transit fleet expansion. APT A received notification that they are able to receive funding in the amount of $873,126 under the Ontario Transit Renewal Program (OTRP). (City of Pickering's share of this grant would be approximately $436,563.) As a requirement of the OTRP grant, the City of Pickering has to establish a separate reserve fund, to be known as the Ontario Transit Renewal Reserve Fund. The current application covers $575,000 for conventional transit (3 buses) and $90,000 for specialized transit. Further application will be made for the balance of the funding once more details are forthcoming from the Province. The OTRP funds will be administered through the establishment of a Reserve Fund under the Municipal Act. The operation of this fund will be governed by the attached by-law, The By-Law will be governed by the provisions of the Municipal Act, and Regulations thereunder, specifically Section 163(2) regarding the establishment of the Reserve Fund and Section 167 regarding the investment of funds. The funds will be accounted for separately, invested conservatively, reported on as a separate fund and subject to the annual audit. Attached, please find for your information, the letter from the Ministry of Transportation and the draft Letter of Agreement between the City of Pickering and the Province of Ontario regarding the Ontario Transit Renewal Program. Also attached is a letter from APT A to the Ministry of Transportation making application for the funding. Ajax is taking similar actions and setting up a Reserve Fund. Report CS 16-02 Date: August 6, 2002 80 Subject: Establishment of the Ontario Transit Renewal Reserve Fund Page 3 Attachments: 1. 2. Ontario Transit Renewal Reserve Fund By-Law Draft Letter of Agreement Between the Province of Ontario and City of Pickering Regarding the Ontario Transit Renewal Program Letter from Ministry of Transportation dated June 21,2002 Letter dated July 31,2002 from APTA to the Ministry of Transportation 3. 4. Prepared By: Approved I Endorsed By: ,~~.þ--- ,- ~ , . - Stan Karwowski Manager, Finance & Taxation ~~c~ 'lfillis A. Paterson Director, Corporate Services & Treasurer GAP:vw Attachments Copy: Chief Administrative Officer Recommended for the consideration of Pickering City Council ", ATTACHMENT#-L TO REPORT# Cs- ICo - ð.:L THE CORPORATION OF THE CITY OF PICKERING 81 BY-LAW NO. /02 Being a by-law to provide for the establishment of a Reserve Fund to be known as the Ontario Transit Renewal Reserve Fund. WHEREAS under the Municipal Act, R.S,O., 1990 as amended, Section 163(2) and 252, the Council of the City of Pickering may establish and maintain a reserve fund for any purpose for which it has authority to expend funds. WHEREAS the City of Pickering passed By-Law 5873/01 to execute the transit system merger agreement between the Corporation of the Town of Ajax and the Corporation of the City of Pickering that established the Ajax Pickering Transit Authority. WHEREAS it is desirable for the City of Pickering to establish such a reserve fund for the purpose of receiving funding from the Ontario Transit Renewal Fund and for the paying of transit related expenses as defined in the Ontario Transit Renewal Agreement. NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE CITY OF PICKERING HEREBY ENACTS AS FOLLOWS: 1. The establishment of a reserve fund known as the Ontario Transit Renewal Reserve Fund is hereby authorized. 2. The Ontario Transit Renewal Reserve Fund shall consist of such moneys paid by the Province for the specific purpose of transit fleet renewal together with the investments made and earnings derived there from. 3. The Ontario Transit Renewal Reserve Fund shall be used for the purpose of paying expenses related to transit renewal as defined under the Ontario Transit Renewal Agreement. 4. This By-Law shall come into force on the date of its enactment. BY-LAW read a first, second and third time and finally passed the September, 2002. day of Wayne Arthurs, Mayor Bruce Taylor, Clerk " " 82 ATTACHMENT #...L. TO REPORT # ...C.5. J ~ ... D :l [Note: Insert date.], 2002 [Note: Information regarding the Municipality] Attention: LeQal Clerk RE: Letter of Agreement between Her Majesty the Queen in right of the Province of Ontario, represented by the Minister of Transportation (the "Ministry") and the [Note: Name of the Municipality] (the "Municipality") Related to Renewal Funds to Be Provided by the Ministry to the Municipality under theOTRP (this "Letter of Agreement") This Letter of Agreement is in response to the Municipality's request to the Ministry for financial assistance under the OTRP with regard to the purchase of transit vehicles. In consideration of the mutual covenants and agreements contained in this Letter of Agreement and the Guidelines and Requirements - Ontario Transit Renewal Program 2002 (the "Guidelines and Requirements") which have been reviewed. and are understood by the Municipality and are hereby incorporated by reference. and other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged), the Ministry and the Municipality covenant and agree as follows: . 1. In recognition of the Municipality's need to replace ageing transit vehicles and the Municipality having entered into a binding agreement with a manufacturer for the purchase of such vehicles (the "Agreemenf'), the Ministry agrees to provide renewal funds to the Municipality in the amount of [Note: Amount], in accordance with and subject to the terms set out in this Letter of Agreement and the Guidelines and Requirements. 2, The Municipality agrees that it shall provide a copy of the Agreement to the Ministry prior to the payment of any renewal funds by the Ministry under this Letter of Agreement and that the terms of the Agreement must comply with the requirements under the Guidelines and Requirements, The Municipality agrees that the renewal funds are to be deposited in a capital reserve account by the Municipality and are to be used only in accordance with the Guidelines and Requirements, 3, -- 2 83 4. The Municipality understands and agrees that the renewal funds represent the full extent of the Ministry's and Province's financial contribution towards the major refurbishment and replacement of transit vehicles and that no additional funds will be provided by either the Ministry or the Province for such purposes to the Municipality for the year 2002, If the Municipality is satisfied with and accepts the terms and conditions of this Letter of Agreement, please secure the required signatures for the four enclosed copies of this Letter of Agreement and return two fully signed copies to the undersigned for the Ministry's record, Once the Ministry has received the signed copies together with a copy of the Agreement, the Ministry will make arrangements for the payment of the renewal . funds to the Municipality. . Yours very truly, Norman W, Sterling Minister of Transportation I have read and understand the terms of this Letter of Agreement, as set out above, and by signing below I am signifying the Municipality's consent to be bound by these terms, CORPORATION OF THE [Note: Name of the Municipality.] Per: Date: Mayor/Reeve Per Date: City Clerk .\TTACHMENT #---3- TO REPORT#...Œ.../G:, ,- 0.;1 8 4Mln,stry of Transportation Mlnlstère des Transports @ Ontario Policy, Planning and Standards Division 301 Floor, Ferguson Block 77 Wellesley st. West Toronto, Ontario, M7A 1Z8 Tel: (416) 327-8521 Fax: (416) 327-8746 i., JUN 'l 1 1002 Mr. Wayne Arthurs Mayor City of Pickering/Ajax 1 The Esplanade Pickering, ON L 1V 6K7 Dear Mayor Arthurs: I am pleased to enclose the Guidelines and Requirements for the 2002 Ontario Transit Renewal Program, which is a key part of the new provincial transit investment plan announced by the Premier on September 27, 2001. \_/ The 2002 funding allocation for (Pickering/Ajax) is $873,126. The attached Guidelines will provide your staff with the necessary information and reporting process to access your allocation of renewal funds this year. You will note in the attached guidelines that the province is prepared to make full payment of a municipality's 2002 allocation into a municipally created capital reserve account based on the submission of a signed bus replacement acquisition order. This will assist municipalities in niakingany progress payments or signing costs that may be incurred this year. With these funds being maintained in a capital reserve account it is our hope that this will further encourage municipalities to proceed with bus replacement programs. We will also be investigating alternative procurement and financing approaches which we hope will provide municipalities with some additional tools to facilitate replacement of their transit fleets. Ontario municipalities have continued to express their need to replace ageing transit fleets which contribute to higher operating costs, increased emissions, reduced service reliability and delays in achieving system accessibility. As a result, the program will target the replacement and refurbishment of municipal transit fleets over the first few years of the program. and will reduce the municipalities' share of capital investment in these fleets by sharing up to one-third of the cost of ongoing vehicle replacement. '-/ .,./2 http:{{www.mto,gov,on.ca ."'. _u"...- .. -2- Staff from the ministry's Inter-Regional Transit Office will be available to assist transit staff from your municipality in answering questions about eligibility and the necessary reporting requirements to access the 2002 allocation of renewal funds and to determine your municipality's eligibility for 2003 transit renewal funds, ,¡,. Yours sincerely, ~Ji£ -<- o:L.: Fareed M, Amin Assistant Deputy Minister Enclosure \....../ cc: Mr. Ted Galinis, General Manager, Town of Ajax/Pickering /' The Honourable Norman W. Sterlir9, Minister of Transportation , 1. , . . , 0 85 '. ( c AJAX PICKERING ~ AUTHORITY ATTACH M ENT # L TO REPORT # C:::. I' ~ (J;l Ajax Pick~ring Transit Authority 110 Westney Road South Ajax, ON Canada LiS 2CB Fareed M. Amin Assistant Deputy Minister of Transportation Policy, Planning and Standards Division Ferguson Block, 3rd Floor 77 Wellesley St. West Toronto, Ontario M4A 128 July 31, 2002 Dear Fareed Amin, Acting on behalf of the Town of Ajax and City of Pickering we are responding to the Guidelines and Requirements for the 2002 Ontario Transit Renewal Program (OTRP) application. As requested, we will be creating separate Capital Reserve Funds for the 2002 funding allocation of $873,126, to be split equally by each Municipality (50% of the full amount). Two separate reports will go before each respective Council for approval and creation of the Reserve Funds. Approval for the attached By-law requests is expected no later than September 30, 2002. Renewal funding payments for the Ajax Pickering Transit Al!thority (APTA) are to be administered by APT A Treasurer, Gil Paterson, on behalf of APT A. Enclosed please find the OTRP foTITIS r¡;;quired for the July 31 s1 submission. Also attached is the contract to purchase three (3) Orion V vehicles that was executed on June 5th, 2002; and the signed bus overhauls replacement acquisition order fot four buses, executed on July 11 th, 2002. We look forward to further clarification concerning the process regarding approved funding allocation for APT A's initial submission, Should you have any questions or conéerns, please do not hesitate to contact me. Sincerely, ed Galin' , General Manager Ajax Pic ering Transit Authority Copy: Regional Councillor Maurice Brenner, Co-Chair, APT A Board of Management Regional Councillor Jim McMaster, Co-Chair, APT A Board of Management Mayor Wayne Arthurs, City of Pickering Mayor Steve ~atjsh, Town of Ajax Thomas J. Quinn, Chief Administrative Officer, City of Pickering Richard Parisotto, Chief Administrative Officer, Town of Ajax Neil Killens; Deputy General Manager, APT A Gil Paterson; Treasurer, APT A Greg Kirkbride, Director of Finance, Town of Ajax Pete Coghill, Ministry of Transportation ;:~('r-,.1.~-:- ,'::-A ", .. ,- ~'- - ~', .. "" "