Information previously distributed / Information distribué auparavant

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1 M E M O / N O T E D E S E R V I C E Information previously distributed / Information distribué auparavant TO: MAYOR AND MEMBERS OF COUNCIL DESTINATAIRE : Maire et membres du Conseil FROM: Gord MacNair, Director, Corporate Real Estate Office, Corporate Services Department EXPÉDITEUR : Gord MacNair, Bureau des biens immobiliers municipal, Direction générale des services organisationnels CONTACT: Gord MacNair, Director, Corporate Real Estate Office, Corporate Services Department , ext gord.macnair@ottawa.ca PERSONNE RESSOURCE : Gord MacNair, Directeur, Bureau des services immobiliers municipaux , poste gord.macnair@ottawa.ca DATE: APRIL 24, avril 2018 FILE NUMBER: ACS2018-CSD-CRE-0007 SUBJECT: STAGE 1 OTTAWA LIGHT RAIL TRANSIT PROJECT STATUS OF EXPROPRIATIONS AND REAL ESTATE TRANSACTIONS OBJET : ÉTAPE 1 DU PROJET DE TRAIN LÉGER D OTTAWA ÉTAT DES EXPROPRIATIONS ET DES TRANSACTIONS IMMOBILIÈRES In follow-up to the April 3, 2018 Finance and Economic Development Committee meeting, this memo provides an update on the status of expropriations and real estate transactions for the Stage 1 Ottawa Light rail Transit (OLRT) Project and the expected timing for the reporting of the details of these matters to Finance and Economic Development Committee and City Council.

2 BACKGROUND On March 6, 2012, Council carried Motion No. 18/3, a copy of which is attached as Schedule A to this memorandum. At that time, Council determined that, in order to protect the City s negotiating position with respect to property acquisitions for the Stage 1 OLRT Project, it is in the best interest of the City that staff report the details of real estate transactions and expropriations related to the Stage 1 OLRT Project to the Finance and Economic Development Committee and City Council once the City has secured all property required for the Stage 1 OLRT Project. The rationale for this approach is that the publication of the details of property transactions and the settlement of expropriation claims before all property is acquired and claims for compensation are settled is that this information could prejudice the City s position in its remaining negotiations and proceedings relating to outstanding claims under the Expropriations Act relating to the Stage 1 OLRT Project. STATUS OF EXPROPRIATIONS AND PROPERTY ACQUISITION FOR STAGE 1 OLRT In response to requests for an update on the status of expropriations and real estate transactions for the Stage 1 OLRT Project, and the expected timing for the reporting of the details of these matters to Finance and Economic Development Committee and City Council, staff have assembled the following information: The City initiated expropriation proceedings and/or negotiations to acquire property interests from approximately 70 property owners in connection with the Stage 1 OLRT Project; Approximately 10 expropriation claims remain outstanding. These claims are expected to proceed through formal mediation and possibly arbitration commencing in the year following revenue service for the Confederation Line. The City has entered into complex framework and construction agreements with owners of property required for integrated station entrances in six (6) locations. The majority of these agreements provide for the negotiation of entrance connection agreements and real estate transfer agreements following the substantial completion of the station entrances. These agreements are currently in negotiation and are expected to be concluded over the next year. The City has also entered into a number of agreements with institutions, Crown corporations, federal agencies and departments of the federal government with respect to property required for the Stage 1 OLRT Project. A number of these agreements provide for the grant of temporary licenses to permit the construction of the Stage 1 OLRT Project but require the preparation of reference plans based on the final dimensions of stations and other LRT infrastructure as well as the exchange of updated appraisals following completion of the Stage 1 OLRT Project, with

3 transactions to be completed in In some instances, the agreements also permit these entities to advance claims for additional compensation for a period of approximately one year following revenue service. The time required to resolve compensation claims relating to expropriations and property acquisitions can vary depending on whether or not formal arbitration is required. Based on information currently available, staff anticipates being in a position to provide a report to Finance and Economic Development Committee and City Council with respect to expropriations and real estate transactions for the Stage 1 Project OLRT in Notwithstanding the above, where it is possible to do so without jeopardizing the City s financial interests, staff have provided a summary of costs associated with acquisitions and expropriations required for the Stage 1 OLRT Project in advance of the presentation of the report to Finance and Economic Development Committee and City Council. For example, on December 22, 2016, staff reported to Council the total cost of completing the land assembly required for the Maintenance and Storage Facility (MSF) on Belfast Road following the settlement of all outstanding claims under the Expropriations Act relating to that component of the Stage 1 OLRT Project. An extract from the December 22, 2016 Memorandum to Council is attached at Schedule B. Please don t hesitate to contact me if you have any questions. Original signed by: Gord MacNair CC: Senior Leadership Team Attachment: Schedule A - Motion No. 18/3 Schedule B - Extract from December 22, 2016 Memorandum to Council

4 SCHEDULE A MOTION FED 18/03 Moved by Councillor P. Hume WHEREAS the City is in the process of acquiring property required for the Ottawa Light Rail Transit (OLRT) project, for which an overall budget has been set for the acquisition of property; and WHEREAS, on May 25th, 2011, City Council approved a delegation of authority to the City Manager to approve real estate transactions having a value of up to $2,000,000, including offers under the Expropriations Act; and WHEREAS Council motion 24/2 provided for expedited approvals of settlements for expropriation claims in excess of $2,000,000 relating to the OLRT project; WHEREAS there may be instances where either a real estate transaction or an offer under the Expropriations Act with a value exceeding $2,000,000 will be required in order to secure property required for the OLRT project; and WHEREAS, in order to meet the OLRT project accelerated schedule, it is in the best interest of the City to provide for delegated authority to approve all real estate transactions, or offers under the Expropriations Act, with respect to property acquisitions for the OLRT project which are in accordance with the requirements of the City s approved Real Property Acquisition Policy; and WHEREAS, in order to protect the City s negotiating position with respect to property acquisitions for the OLRT project, it is in the best interest of the City that staff report the details of real estate transactions and expropriations related to the OLRT project to the Finance and Economic Development Committee and City Council once the City has secured all property required for the OLRT; THEREFORE BE IT RESOLVED THAT the Deputy City Manager, Planning and Infrastructure, be delegated the authority to advance all real estate transactions or offers under the Expropriations Act, for property required for the Ottawa Light Rail Transit (OLRT) project, where they are in accordance with the requirements of the Real Property Acquisition Policy and with the concurrence of the ward Councillor and the Mayor; and BE IT FURTHER RESOLVED THAT staff report the details of real estate transactions and expropriations related to the Ottawa Light Rail Transit (OLRT) project and approved by delegated authority to the Finance and Economic Development Committee and City Council after all property required for the project has been secured by the City. CARRIED

5 SCHEDULE B To / Destinataire Mayor and Members of Council File/N de fichier G00-11 From / Expéditeur Subject / Objet Marian Simulik, General Manager, Corporate Services and City Treasurer Total Cost of the Confederation Line (Stage 1) Light Rail Transit Project Date: December 22, 2016 The purpose of this memorandum is to provide the Mayor and Members of Council with an updated summary of the total direct and indirect costs associated with Stage 1 of the Confederation Line Light Rail Transit Project (Stage 1 LRT Project), as requested on December 1, 2016 during the Audit Committee review of the Auditor General s 2017 Workplan. This is an update to the memo sent May 9, 2016 to Mayor and Councillors in response to a request made during the Audit Committee s review of the Auditor General s 2016 Workplan. CONFEDERATION LINE CONSTRUCTION With respect to property acquisition, part of the discussion at the Audit Committee meeting concerned the numbers and details of each land purchase arising from Stage 1 of the OLRT Project. The subject and strategy around the property acquisitions for the Stage 1 LRT Project were set out in the December 2012 report and also referenced in two other key reports to the Finance and Economic Development Committee (FEDCO) and Council. Specifically, on May 25th, 2011, Council approved a report from FEDCO entitled, Ottawa s Light Rail Transit (OLRT) Project Schedule Acceleration and Procurement Option Selection. That report included the following recommendation regarding property acquisition: Direct staff to accelerate the acquisition of properties for the OLRT project by: Beginning the expropriation process, where required, to accelerate the construction of the OLRT project pursuant to Section 4 of the Expropriations Act; and

6 Increasing the property acquisition delegated authority limit as outlined in Table 1 in this report. This report noted that, in order to meet Council s accelerated schedule for the OLRT Project, the property acquisition process would need to be streamlined. On March 28 th, 2012, Council approved a second report on this matter entitled, OLRT Design Improvements Update. During the consideration of this matter at FEDCO on March 6 th, 2012, Members approved an amendment to acquire property for this Project with respect to the delegation of authority in [Motion Fed 18/03]: Through this motion, Council has approved the increased delegated authority for property acquisitions to meet the accelerated schedule for the OLRT Project, and also expressly set out the public disclosure mechanism regarding same. In the interim, staff can provide the following summary with regard to the Maintenance and Storage Facility (MSF) as it is deemed to be a singular component of the land assembly for the OLRT Project. In effect, the land assembly concerning the MSF is now complete and involved 12 owners and 19 tenants of commercial and industrial buildings on Belfast Road. The total cost to acquire these properties was approximately $58 million, which was consistent with staff s budgetary estimates, and is included in the total $2.130 billion budget for Confederation Line construction. This figure includes market value plus all settlement costs such as, but not limited to, disturbance damages, legal fees and appraisal costs. In accordance with the above-noted direction, all remaining costs and details of the property acquisition for the OLRT Project will be reported to FEDCO and Council once the City has secured all required lands for the entire Project. If you require further information with respect to the information in this memorandum, please feel free to contact either, Isabelle Jasmin, Deputy Treasurer, Corporate Finance, at ext , or myself at ext Marian Simulik, General Manager, Corporate Services and City Treasurer / Directrice générale et Trésorière municipal, Services généraux