Report to/Rapport au :

Corporate Services and Economic Development Committee

Comité des services organisationnels et du développement économique

and Council / et au Conseil

14 November 2007 / le 14 novembre 2007

Submitted by/Soumis par : Nancy Schepers

Deputy City Manager/Directrice municipale adjointe

Planning, transit and the Environment/Urbanisme, Transport en commun et Environement

Contact Person/Personne ressource : Rob Mackay, Acting Director, Economic and Environmental Sustainability Branch

Economic Development and Strategic Projects/
Développement économique et Projets stratégiques

(613) 580-2424 x, 22632 Rob.Mackay@ottawa.ca

City Wide

Ref N°: ACS2007-PTE-ECO-0023

SUBJECT:	City of ottawa support for ottawa congress centre redevelopment project
OBJET :	appui de la ville d’ottawa pour le projet dE RÉaménagement du centre des congrès d’ottawa

REPORT RECOMMENDATIONS

That the Corporate Services and Economic Development Committee recommend Council:

1. Support the Ottawa Congress Centre (OCC) planned reconstruction and expansion as a Strategic Priority Initiative and reconfirm City Council’s commitment as per Motion No. 57/4 (Document 1) to provide $25 million for the capital construction costs to be financed by a debenture in that amount;

2. Contribute an additional $15 million as a Strategic Priority Initiative for the OCC’s planned reconstruction and expansion and authorize debt financing in the same amount, subject to Council’s deliberations of the 2008 budget;

3. Withdraw its total funding contribution of $40 million to the OCC project if the City has not received written confirmation that all project funding is secured and a conditional building permit has been released for the project by December 31^st 2008; and

4. Delegate responsibility to the City Manager to negotiate, approve and execute a contribution funding agreement with the OCC upon satisfactory completion of conditions that include but are not limited to the following:

a. The City receiving from the Government of Ontario its assurance, in a form satisfactory to the City, that the Province is the sole owner of the OCC and assumes the continuing full and final financial responsibility for the OCC, as it is currently constituted or any permitted successor thereof.

b. The City receiving written confirmation from the Government of Ontario that it has issued to the OCC $30 million for the reconstruction of the Ottawa Congress Centre in keeping with its previous funding commitment.

c. The City receiving a copy of the fully executed funding agreement between the OCC and the Government of Ontario detailing and committing its additional $20 million contribution to the project.

d. The City receiving a copy of the fully executed funding agreement between the OCC and the Federal Government detailing and committing its $50 million contribution to the project.

e. The City receiving written confirmation from the OCC that sufficient debt financing from their lenders of no less than $30 million to an upset of $40 million, over and above the Municipal, Provincial and Federal Government project funding requested herein, has been unconditionally committed and will be secured by the Government of Ontario for the Ottawa Congress Centre project.

f. The City receiving executed legal agreements between the OCC and organizations such as the Ottawa Airport Authority (OAA) and the Ottawa Gatineau Hotel Association (OGHA) that specifies a combined annual payment with a minimum term of 25 years of $1.5 million that is to be indexed for inflation to ensure the financial sustainability for the OCC operations.

g. The City receiving written assurances from the Government of Ontario together with any necessary approvals by the Minister of Finance in a form satisfactory to the City, that it assumes ultimate ownership of the OCC and that any operational shortfalls and/or debt under the current OCC governance model or under any future governance model of the OCC will be appropriately addressed by the OCC and the Government of Ontario, and not by the City.

h. That a new building design and road design concept for Colonel By Drive be developed by the OCC for review and written approval by both the National Capital Commission (NCC) and the City of Ottawa.

i. That the OCC design meets the requirements of the “Downtown Ottawa Urban Design Strategy”.

j. The City receiving and being satisfied with the terms of the final executed amended and restated lease between the OCC and the Viking Rideau Corporation (VRC) and with the final executed development and Construction Agreement between the same parties, and receiving non-disturbance agreements from all of VRC’s current mortgagees.

k. The City receiving written assurances from the OCC and Province, that they shall not change the use of the facility, or assign or transfer charge or mortgagee, the leasehold interest in all or part of the new facility for the duration of the lease with the VRC, without prior written consent of the City.

l. The OCC demonstrating to the satisfaction of the City that it will use reasonable commercial efforts to achieve LEED (Leadership in Energy and Environmental Design) Silver certification for the Ottawa Congress Centre Building and that Green Roof technology be incorporated where possible.

m. The OCC agreeing to direct 1.5% of the final construction budget (currently estimated at $159 million) for the OCC project towards implementing the City’s Transit Oriented Development Guidelines. Such funding will be used to integrate the downtown transit network, into the Congress Centre project and improve transit services to and from the building.

n. The OCC agree that the release of the City’s funding of $40 million for the project be conditional on all required approvals and/or permits under the Planning Act and Building Code Act for the projects development have been obtained including any required approvals from the Provincial and Federal Governments.

o. The City receiving from the OCC its written confirmation that it shall use a competitive process, as pre-approved by the City, to acquire all equipment, services, supplies and for construction.

RECOMMANDATIONS DU RAPPORT

Que le Comité des services organisationnels et du développement économique recommande au Conseil :

1. d’appuyer la reconstruction et l’expansion prévues du Centre des congrès d’Ottawa (CCO) à titre d’initiative prioritaire stratégique et de reconfirmer l’engagement qu’a pris le Conseil municipal conformément à la motion n^o 57/4 (Document 1) de fournir 25 millions de dollars pour les coûts de construction d’immobilisations qui seront financés par une débenture de ce montant;

2. de fournir 15 millions de dollars supplémentaires à titre d’initiative prioritaire stratégique aux fins de la reconstruction et de l’expansion prévues du CCO, et d’autoriser le financement par emprunt de ce même montant, selon les délibérations du Conseil sur le budget 2008;

3. de retirer la totalité de sa contribution au financement de 40 millions de dollars du projet du CCO si la Ville n’a pas reçu de confirmation par écrit que l’ensemble du financement du projet est garanti et qu’un permis de construction conditionnel sera délivré aux fins du projet d’ici le 31 décembre 2008; et

4. de confier au directeur municipal la responsabilité de négocier, d’approuver et de signer un accord de financement sous forme de contribution avec le CCO, y compris les conditions préalables suivantes, qui doivent être abordées avant la signature de l’accord de contribution, sur des questions qui incluent mais qui ne se limitent pas à ce qui suit :

a. La Ville qui reçoit du gouvernement de l’Ontario l’assurance, sous une forme satisfaisante pour la Ville, que la province est le seul propriétaire du CCO et qu’elle assume de façon permanente la responsabilité financière complète et finale du CCO comme il est constitué présentement, ou tout successeur permis correspondant;

b. La Ville reçoive du gouvernement de l’Ontario une confirmation par écrit indiquant qu’il a accordé au CCO 30 millions de dollars pour la reconstruction du Centre des congrès d’Ottawa, conformément à son engagement en matière de financement précédent;

c. La Ville qui reçoit une copie de l’accord de financement dûment signé entre le CCO et le gouvernement de l’Ontario présentant les détails de son montant supplémentaire de 20 millions de dollars qui a été engagé dans le projet;

d. La Ville qui reçoit une copie de l’accord de financement dûment signé entre le CCO et le gouvernement fédéral présentant les détails de son montant de 50 millions de dollars qui a été engagé dans le projet;

e. La Ville qui reçoit une confirmation par écrit du CCO indiquant qu’un financement par emprunt suffisant de leurs prêteurs d’au moins 30 millions de dollars et d’au plus 40 millions de dollars, en sus des subventions publiques, a été engagé sans condition et sera garanti par le gouvernement de l’Ontario pour les coûts de construction d’immobilisations du nouveau Centre des congrès d’Ottawa;

f. La Ville qui reçoit les accords juridiques signés entre le CCO et des organismes tels que l’Administration de l’Aéroport d’Ottawa et l’Association des hôtels d’Ottawa-Gatineau qui précisent un paiement annuel combiné, dont le terme minimal est de 25 ans, de 1,5 million de dollars qui sera indexé à l’inflation, en vue d’aider à maintenir la viabilité financière à long terme des activités du CCO;

g. La Ville qui reçoit du gouvernement de l’Ontario l’assurance par écrit, ainsi que toute autorisation nécessaire du ministre des Finances sous une forme satisfaisante pour la Ville, qu’il assume la propriété ultime et que toute lacune opérationnelle et/ou toute dette en vertu du modèle de gouvernance actuel du CCO ou en vertu de tout modèle de gouvernance futur du CCO sera adéquatement gérée par le CCO et le gouvernement de l’Ontario, et non par la Ville;

h. Qu’un nouveau concept d’aménagement de bâtiment et de la route pour la promenade Colonel‑By soit élaboré pour fins d’examen et d’approbation par écrit par la Commission de la capitale nationale (CCN) et la Ville d’Ottawa;

i. Que le plan d’aménagement du CCO réponde aux exigences de la « Stratégie de conception urbaine du centre-ville d’Ottawa »;

j. La Ville qui reçoit les modalités du bail final modifié et reformulé qui a été signé entre le CCO et la Société Viking de Rideau, et qui en est satisfaite, ainsi que de l’accord d’aménagement et de construction final dûment signé entre les mêmes parties, et qui reçoit des accords anti-nuisance de tous les créanciers actuels de la Société Viking de Rideau;

k. La Ville qui reçoit du CCO et de la province l’assurance par écrit qu’ils ne doivent pas changer l’utilisation de l’installation, ni céder ni transférer au responsable ou au créancier, les intérêts à bail, en tout ou en partie, de la nouvelle installation, pour la durée du bail signé par la Société Viking de Rideau, sans consentement écrit préalable de la Ville;

l. Le CCO qui démontre à la satisfaction de la Ville qu’il fera preuve d’efforts commerciaux raisonnables pour satisfaire aux critères d’homologation de catégorie argent de LEED (leadership en matière d’énergie et d’environnement) pour le bâtiment du Centre des congrès d’Ottawa et que la technologie du toit vert sera utilisée dans la mesure du possible;

m. Le CCO qui accepte de consacrer 1,5 % de son financement total nécessaire au chapitre des immobilisations (159 millions de dollars) à la mise en œuvre des lignes directrices sur l’aménagement axées sur le transport en commun de la Ville. Ces fonds serviront à intégrer le réseau des transports en commun du centre-ville, qui est actuellement traité dans le cadre du projet du Centre des congrès, et à améliorer les services de transport en commun à partir de l’édifice et vers l’édifice;

n. Le CCO accepte que la libération des fonds de la Ville d’un montant de 40 millions de dollars pour le projet soit conditionnelle à l’obtention des approbations et de tous les permis requis en vertu de la Loi sur l’aménagement du territoire et de la Loi sur le code du bâtiment pour l’aménagement des projets, ainsi que toute approbation des gouvernements fédéral et provincial requise.

o. La Ville qui reçoit du CCO la confirmation par écrit qu’il adoptera un processus concurrentiel, ayant été approuvé d’avance par la Ville en vue d’acquérir l’ensemble du matériel, des services et des ressources nécessaires à la construction.

EXECUTIVE SUMMARY

Assumptions and Analysis

An expanded Ottawa Congress Centre (OCC) will allow Ottawa to effectively compete for world-class conventions, meet Ottawa’s needs as a G8 Capital and renew and revitalize the heart the City’s downtown. Over the past decade, several attempts to expand the OCC have been made. The existing facility’s small size of 70,000 square feet of leasable space and deteriorating condition has constrained and limited economic growth and the local tourism industry in the City. On September 2007, under the leadership of a new Chair and President, as well as Board of Directors, the OCC released its redevelopment and business plans for review.

The redevelopment proposal calls for a Tier II convention facility (ranking assigned by event planners based on the City’s population and air access and the size and quality of its primary convention facility). This involves the demolition of the existing facility to be replaced by a vertical and horizontal expansion of two new floors from ground level with over 200,000 square feet of rentable convention and meeting space. The new space will be extended outward to Colonel By Drive and Daly Avenue.

A financial model has been developed for the new facility identifying a total upset project cost of $180 million. This includes construction costs of $159 million and the balance for transition costs, OCC operating losses during the construction period, etc. The financial model requires $140 million in public funding with the balance of costs, estimated between $30 to $40 million as an upset amount, to be financed by the OCC. The public sector contributions are detailed as follows: Federal Government $50 million; Provincial Government 50 million and the City of Ottawa $40 million.

The OCC intends to cease operations and commence demolition by September 1, 2008 for a duration of 6 months. Construction is planned over a 24-26 month period with the facility opening on April 1, 2011 after commissioning.

Substantial short and long term economic benefits will be realized including 1500 jobs directly and 4500 jobs indirectly related to the expansion. The City’s investment in a new OCC will positively impact the City’s hotel, retail, restaurant, transportation and entertainment sectors resulting in a conservative, anticipated increase in property tax revenues from the growth of these industries by $19.5 million per year. This investment will leverage $140 million of capital spending on the project from the OCC, Provincial and Federal Governments. Through this spending a major world-class public facility will be developed in Ottawa’s downtown precinct, which will serve as a catalyst for further positive change and revitalization of this important area of the City. This revitalization is inline with the City’s recently completed Downtown Urban Strategy and will accelerate the achievement of key objectives in this document. A Tier II convention centre in Ottawa will assist the City’s global market efforts attracting new investment and skilled workers. As well it is anticipated that the City will now capture a larger percentage of government conventions, which could not be accommodated in the smaller, existing convention centre. It will also stem the flow of other non-government convention centre and meeting room business out of Ottawa and recapture this investment in the City and its economy.

Financial Implications:

On June 25^th 2003 Council approved motion No. 57/4 to provide a contribution of $25 million to the OCC expansion project. The motion also removed previous conditions associated with this project with the exception that written confirmation be received from the Government of Ontario indicating they are sole owner of the OCC. In accordance with this motion, $25 million of debt authority has been established and an account (903640) has been set-up for cash flow purposes.

An additional debt authority for $15 million is required in accordance with the current funding contribution request made by the OCC and its approval will be subject to the outcome of the 2008 budget exercise. Should this funding be approved this amount will be placed in the City’s Strategic Initiatives Fund. This fund is established for Council-directed initiatives identified in the City Corporate Plan and for projects that implement City master plans and the Ottawa 20/20 Plans.

The estimated costs of payments on a $40 million debenture issued by the City at current rates over 25 years would be about $2.9 million.

As well staff have recommended that 1.5 percent of the total capital funding requirements be used towards implementing the City’s transit oriented guidelines, as per recommendation 4(m) of this report, as a means of offsetting these costs and to assist in meeting transit objectives. The City’s Funding Contribution Agreement with the OCC will specify how this money is to be directed towards transit related infrastructure.

Property taxes will not be paid on the expanded OCC building. Under Section 10.1 of the Ottawa Congress Centre Act, 1988, the crown agency is directly exempt from municipal property taxes as long as the facility is used as a convention centre.

Public Consultation/Input

The City’s Economic Strategy, Official Plan and the City’s Corporate Plan that support Ottawa’s status as an international convention and tourism destination, were developed in consultation with the community. As well, the OCC has also undergone extensive consultation with the tourism industry, meeting planners and stakeholders as part of the OCC Redevelopment Feasibility Study initiated earlier this year and completed in September 2007.

A comprehensive communications plan has been developed for the OCC with a set of action plans. The Plan was prepared by GBA communication consultants who have identified key audiences and a communications framework. The communications framework is designed to step up communications as the project rolls out from conception to completion. The OCC is currently undergoing an eight-week campaign with a series of full-page weekly ads in the Ottawa Citizen to communicate the redevelopment proposal to the public.

The Ottawa Chamber of Commerce, the downtown Business Improvement Area Associations, Ottawa Tourism the Ottawa Airport Authority and the Ottawa Gatineau Hotel Association have endorsed the redevelopment proposal.

RÉSUMÉ

Une expansion du Centre des congrès d’Ottawa (CCO) permettra à Ottawa de concurrencer efficacement sur le plan des congrès de classe internationale, répondra aux besoins d’Ottawa à titre de capitale du G8 et renouvellera et revitalisera le cœur du centre-ville. Au cours des dix dernières années, il y a eu plusieurs tentatives d’expansion du CCO. La petite taille de l’établissement actuel (70 000 pieds carrés d’espace louable) et sa condition en détérioration ont freiné et limité la croissance économique ainsi que l’industrie locale du tourisme dans la Ville. En septembre 2007, sous le leadership d’un nouveau président et du Conseil d’administration, le CCO a diffusé ses plans d’activités et de réaménagement pour fins d’examen.

La proposition de réaménagement concerne un centre de congrès de deuxième catégorie (le classement est attribué par les organisateurs de l’événement selon la population de la Ville et l’accès par voie aérienne et selon la taille et la qualité de son centre de congrès principal). Ce réaménagement comprend la démolition de l’établissement actuel, qui sera remplacé par une expansion verticale et horizontale de deux nouveaux étages à partir du niveau du sol comptant plus de 200 000 pieds carrés qui peuvent être loués pour des réunions et des congrès. Les nouveaux locaux seront agrandis vers l’extérieur vers la promenade du Colonel‑By et l’avenue Daly.

Dans le modèle financier qui a été élaboré pour le nouvel établissement, on a attribué 159 millions de dollars pour payer le total des coûts de construction d’immobilisations et d’aménagement et un total de 170‑180 millions de dollars pour payer tous les autres coûts associés au réaménagement, y compris les coûts des RH et les pertes d’exploitation pendant la période de construction. Le modèle financier exige que les 140 millions de dollars de fonds publics et la balance des coûts, évaluée à 30‑40 millions de dollars, soient financés par le CCO. Les contributions du secteur public sont réparties comme suit : gouvernement fédéral – 50 millions de dollars; gouvernement provincial – 50 millions de dollars et la Ville d’Ottawa – 40 millions de dollars.

Le CCO prévoit cesser ses activités et commencer la démolition au plus tard le 1^er septembre 2008 pour une durée de six mois. On prévoit que la construction durera entre 24 et 26 mois et que l’établissement pourra recommencer ses activités le 1^er avril 2011.

Il y aura des retombées économiques considérables à court terme et à long terme, y compris 1 500 emplois directement liés à l’expansion et 4 500 emplois indirectement liés à cette expansion. L’investissement de la Ville dans l’expansion du CCO aura également des répercussions positives pour les secteurs hôtelier, du commerce de détail, de la restauration, du transport et du divertissement de la Ville entraînant une augmentation prévue des recettes tirées des taxes foncières de ces industries de 19,5 millions par année. De plus, l’investissement de la Ville procurera 140 millions de dollars supplémentaires pour construire un important établissement public de classe mondiale dans un secteur clé du centre-ville qui jouera un rôle catalyseur dans l’apport d’autres changements positifs visant à revitaliser le milieu urbain environnant et à stimuler l’aménagement de nouveaux hôtels et de commerces de détail qui contribueront au dynamisme et à la qualité de vie de la Ville.

Répercussions financières :

Le financement de ce projet vient du Fonds pour les initiatives stratégiques de la Ville. Ce fond est établi pour les initiatives demandées par le Conseil déterminées dans le Plan directeur municipal et pour les projets qui mettent en œuvre les plans directeurs de la Ville et les plans d’Ottawa 20/20. Le 25 juin 2003, le Conseil a approuvé la motion n^o 57/4 dans laquelle on accordait une contribution de 25 millions de dollars au projet du CCO et où on éliminait les conditions précédentes du Conseil liées à l’expansion du projet, sauf la condition selon laquelle le gouvernement de l’Ontario doit confirmer par écrit qu’il est le seul propriétaire du CCO. Conformément à cette motion, une autorisation d’emprunt a été établie et on a créé un compte 903640 pour les rentrées de fonds en 2005.

Pour répondre à la proposition actuelle, une autorisation d’emprunt supplémentaire de 15 millions de dollars est maintenant exigée de la Ville.

Les coûts estimés des paiements sur une débenture de 40 millions de dollars à 4,5 % sur 25 ans représenteraient environ 2,7 millions de dollars. Le personnel a recommandé que 1,5 % du financement total nécessaire au chapitre des immobilisations (159 millions de dollars) soit consacré à la mise en œuvre des lignes directrices axées sur le transport en commun de la Ville, conformément à la recommandation 4(m) du présent rapport, comme moyen de compenser ces coûts et pour aider à atteindre les objectifs en matière de transport en commun.

Aucun autre impôt foncier ne sera réalisé à la suite de l’expansion proposée du CCO. En vertu de l’article 10.1 de la Loi sur le Centre des congrès d’Ottawa, l’organisme d’État est directement exempté des impôts fonciers municipaux tant et aussi longtemps que l’établissement est utilisé à titre de centre de congrès.

Consultation publique/commentaires

La Stratégie économique, le Plan officiel et le Plan directeur de la Ville, qui appuient la situation d’Ottawa en tant que destination internationale pour les congrès et le tourisme, ont été élaborés en consultation avec la collectivité. De plus, le CCO a fait de nombreuses consultations avec l’industrie du tourisme, les planificateurs de réunions et les intervenants dans le cadre de l’Étude de faisabilité sur le réaménagement du CCO qui a été menée plus tôt cette année et qui s’est terminée en septembre 2007.

On a élaboré pour le CCO un plan de communication approfondi ainsi qu’une série de plans d’action. Le plan a été préparé par les conseillers en communication de GBA, qui ont déterminé les publics clés et un cadre de communication. Le cadre de communication est conçu de façon à accroître les communications au fur et à mesure que le projet passe de la conception à l’exécution. Le CCO fait actuellement l’objet d’une campagne de huit semaines dans le cadre de laquelle il y a publication d’une série d’annonces publicitaires hebdomadaires d’une page dans le Ottawa Citizen dans le but de communiquer la proposition de réaménagement au public.

La Chambre de commerce d’Ottawa, les associations de la zone d’amélioration commerciale du centre-ville, Tourisme Ottawa, l’Administration de l’Aéroport d’Ottawa et l’Association des hôtels d’Ottawa-Gatineau appuient la proposition de réaménagement.

BACKGROUND

An expanded Ottawa Congress Centre (OCC) for the nations capital has long been recognized by the local tourism industry, the community and the City as an important way to better market Ottawa as a premiere Tier II Convention destination. The facility would serve as a catalyst for business growth and investment, positive urban design and would assist in revitalizing Ottawa’s downtown. Due to the existing facility’s small size of 70,000 square feet of leasable space (Tier III) and deteriorating condition, it has been unable to attract medium and large-sized conventions. This has served to reduce its economic impact limiting revenues in 2007 to approximately $8.5 million. In comparison to competing Canadian convention facilities in similar sized cities, the OCC is by far the smallest facility ranking behind Edmonton, Calgary, Quebec City, Winnipeg and Halifax.

Over the past decade, several attempts to expand the OCC have been made. The previous effort was initiated in January 2000, with a business case supporting the expansion. The business case envisaged a Tier II convention facility having a vertical expansion over the existing facility resulting in a five-storey building. This was substantially higher than what is currently permitted under existing zoning regulations. By 2003, funding commitments from the Province of Ontario ($30 million – Super Build Millennium Partnership Program), the Government of Canada ($30 million – Canada Strategic Infrastructure Fund) and the City of Ottawa ($25 million) were secured. The City’s approval was based on Motion 57/4 (Document 1), dated June 25, 2003 rescinding previous conditions concerning the hotel and expansion of the Rideau Centre, but conditional upon the Provincial Cabinet confirming sole ownership and responsibility for any cost overruns and budgetary shortfalls of the OCC.

A review of the previous project identified many challenges including: inflexible OCC lease arrangements with the Viking Rideau Corporation (VRC); escalating construction costs; shared parking revenue issues; a challenging redevelopment plan involving an elaborate and costly steel bridge over the existing facility which was to remain in operation during the construction period; and a new floor plate that would end up being problematic for medium-sized conventions.

This led to the Government of Ontario cancelling the planned expansion in February 2006, followed by the Federal Government terminating their funding agreement in June of that same year. The City’s funding contribution agreement was never executed, as it was conditional upon receiving finalized funding agreements from the Federal and Provincial Governments and between the OCC and the VRC. Despite the cancelled expansion plans, all three levels of government encouraged a renewed effort under a new OCC management board with a challenge to address the constraints faced by the previous initiative and a mandate to establish a new solution.

In May 2007, under the leadership of a new Chair and President as well as a Board of Directors, a Feasibility Study on the Re-development of the OCC was commissioned. The new OCC Board established a deadline of September 2007 to find a resolution and a way forward. As part of the feasibility study, the board undertook a site option analysis to set a benchmark for affordability and identify a redevelopment solution. Options evaluated included the existing site with an alternative site at Lebreton Flats. Feedback was received from meeting planners and industry representatives who rated the existing site as a far superior location that can generate a significantly higher economic impact with larger operating revenues.

On September 12th, 2007, the Board of Directors approved the feasibility study and its supporting business case. This work calls for the demolition of the existing building and the construction of a larger, state of the art convention facility. The new convention centre would have 200,000 square feet of rentable space including a clear span, 100,000 square foot, column free convention room that would eclipse the current larger meeting room in the existing convention centre by approximately 57,000 sq feet. The Centre would be enabled with the latest technology, energy efficient design elements and would be open for use by 2011. It would renew, revitalize and become a signature project within the heart of the City’s downtown.

The following summarizes the new Ottawa Convention Centre project:

New OCC Building

• To remain at the current downtown location next to the Rideau Centre

• 200,000 square feet of rentable space, with over 100,000 square feet of contiguous column free space to meet the demands of large conventions
• Estimated 340,000 square feet total size
• 3+ floor level design solution
• Demolition of existing building except sub-grade levels.
• Alignment of floors with the Rideau Centre and its roof top park.
• Total capital construction cost of $159.4 million
• LEED (Leadership in Energy and Environmental Design) Silver Certification

OCC Financing

• Government of Canada $50 million
• Government of Ontario $50 million ($30 million previously committed and with the OCC from - Millennium Partnership Initiative Fund)
• City of Ottawa $40 million ($25 million previously committed)
• Ottawa Congress Centre $30 to $40 million (new debt financing required)
• Total upset limit of project costs $180 million (accounts for contingencies, operating losses during construction, development charge fees, building permit fees, planning approval fees, and HR transition costs)

Business Model

• OCC construction debt financing to be secured by the Government of Ontario.
• Construction contract to be a design/build guaranteed “maximum price” contract to manage risk of cost overruns.

• New target markets (medium and large conventions/tradeshows) that yield highest economic benefit.
• Various revenue sources including a financial sustainability payment of $1.5 million from organizations such as the Ottawa Airport and the Ottawa Gatineau Hotel Association. (currently under negotiation).
• Revenues projected from the operations of the OCC and other sources to reach approximately $17 million in 2012 to $28 million by 2020 (source: OCC business plan).
• Annual operating surpluses net of debt servicing and life cycle contributions will provide sufficient cash flow to service project debt.
• Property tax exemption through the Ottawa Congress Centre Act.

Governance Model

• The OCC is a Crown Agency with the majority of Board members appointed by the Province.
• Provincial approval required for any borrowing.

• Investigating governance model transformation alternatives (e.g. Ottawa Airport Authority) to secure a broader business mandate and expansion of board representation.

Urban Environment

• Realignment of Colonel-By Drive to accommodate new development.
• Building design will accommodate linkage solution to Government Conference Centre, National Art Centre, Rideau Centre and Mackenzie King Bridge
• The public realm rebalanced in favour of pedestrians
• Canal Frontage enhancements (e.g. landscaping and pedestrian pathways)

Lease

• OCC has negotiated a new 80-year lease with the Viking Rideau Centre (VRC). VRC is the landlord and owner of the land (3.45 acres) and building envelope.
• Permits effective ownership
• Redefined land area includes air and subsurface rights.
• Permits internal renovations without consent from the VRC (unless impacting on Rideau Centre systems, building or lands) and will allow up to 3 additional refurbishments or redevelopments of the congress centre building after the first 20 years of the lease.
• Rent of land for $1 per year
• Ancillary uses permitted (e.g. business centre, coffee shop)
• Dispute resolution process through Joint Steering Committee to manage construction interface between the OCC and the Rideau Shopping Centre.

Schedule

• Commence demolition September 1st, 2008 for 6 months
• Construction 24-26 months
• Open April 1, 2011

HR Plan

• Carefully constructed HR Strategy including severance costs and an outplacement program to assist employees with their job search in the 3^rd quarter of 2008 (approximately 400 positions)
• Rehiring to commence in January 2011 to allow for training period of new and returning employees.

DISCUSSION

The City of Ottawa has consistently supported the expansion of the OCC and continues to support Ottawa as an international convention and tourism destination. These commitments have been reinforced through policy priorities in the City’s Economic Strategy and the City of Ottawa Official Plan as well as the City’s strategic economic advisory group (The Ottawa Partnership - TOP) who advised the Province as recently as April 2007 of their continued support for this new facility. As a G8 capital and fourth largest metropolitan area in Canada, the size of Ottawa’s primary meeting and convention centre space is inadequate. Ottawa continues to turn away medium and large sized conventions and events due to lack of capacity. This creates a competitive disadvantage and an under-performing local tourism sector, which is the third largest business sector in Ottawa.

Economic Impact

In 2005, more than 180,000 people used the OCC with at least 80,000 patrons coming from other parts of Canada, the United States and the rest of the world. An expanded Ottawa Congress Centre is expected to nearly double out-of-town delegates per year and will attract new visitors, skilled workers, business and cultural events.

It is not only the visitor attraction and significant economic impact that the OCC will generate that is important, but also how a new facility, in a key downtown location within the City, will serve as a catalyst for positive physical and quality of life enhancements. A new OCC will attract new investment, businesses and jobs to the downtown core which will assist the City revitalize and improve the physical appearance of this area. This will attract more tourism spending and cause new taxes to be generated that can be directed at some of the social issues in this area. More direct action on the social issues in the downtown area is currently being discussed with the Ward Councillor and the OCC. These ideas are at a preliminary stage and will be expanded upon at a later date. Through the City’s $40 million investment, an additional $140 million will be leveraged from the Federal and Provincial Governments on the facility. This will result in a major public facility that will benefit the Ottawa economy and the downtown precinct.

In 2007, an economic impact study was completed on behalf of the OCC by the Market Research Corporation, which documents the following benefits:

· 1500 construction jobs directly related to the OCC expansion

· 4500 jobs indirectly related to the OCC expansion

· 80,000/year of additional out-of town guests to the Ottawa Gatineau Region once the OCC is expanded. Based on a new total of 160,000/year of out-of-town guests, users of this larger facility will generate:

o demand for 660,000 room nights of accommodation on an annual basis

o $110 million in annual revenues for the hotel sector (2,669 FTE’s)

o $19 million in sales for the retail sector (158 FTE’s)

o $15 million in revenues for restaurants and bars (189 FTE’s)

o $3.9 million in revenues for the local taxi industry, car rental and other transportation components.

· Approximately 1400 additional hotel rooms will be required for a total of 2800 rooms

· $51 million in Federal and Provincial income taxes during the construction phase

· Ongoing annual Federal income taxes of $26.5 million

· Ongoing annual Provincial income taxes of $17.4 million

· Total ongoing annual Municipal taxes of $19.5 million of which approximately $9 million will be generated from the anticipated expansion of Ottawa’s retail, restaurant, bar, hotel, service commercial industries to serve the new OCC delegates.

In summary, there will be significant short-term construction and ongoing permanent economic benefits for the City due to the OCC expansion. The short- term impact of spending $159 million in Ottawa will be significant. As stated above the construction of the facility will stimulate over 6000 new jobs during the construction period. New construction of this magnitude triggers broad economic multipliers resulting in many new goods and services to be purchased in the community.

Ottawa as a G8 capital will have a new convention centre facility that it can showcase to the world. The City will gain a competitive edge in the international convention centre business and will be well positioned to compete against other Canadian Cities who are currently planning and building new convention centres facilities as a means of boosting their economic prosperity.

Qualitative Improvements

Staff and KPMG have undertaken a review of the OCC financial model and business plan and benchmarked the current proposal against the previous development constraints to ensure they have been addressed. The new Board of the OCC have presented a vision and implementation plan on the basis of a detailed feasibility study with the goal of identifying previous constraints and to identify a way forward. The results of this analysis can be summarized as follows:

Previous Financial Model

The previous financial model established a project budget requirement of $94.5 million and was based on the following funding contributions:

• Federal Government - $30 million
• Provincial government - $30 million
• City of Ottawa - $25 million
• Viking Rideau Corporation - $4 million
• Ottawa Congress Centre - $5.5 million in debt financing.

An additional $31.5 million was also required for the extensive refurbishment of the existing facility bringing the total project amount to $126 million.

For comparative purposes, the new OCC Board requested Hanscomb Cost Consultants this year to assess the current cost of the previous plan. Hanscomb is an international firm specializing in cost planning, control and value management services. Hanscomb concluded that should the Board go ahead with the previous design, the final costs would be much higher. Some of these costs related to the complexity of the proposed structure and its height, its interface with the existing Rideau Centre, the use of costly steel structure elements, new earthquake code requirements and scheduling uncertainties.

Current Financial Model

The OCC Board’s current vision and financial model is predicated on shutting down the existing facility, removing most of the internal elements and rebuilding a larger convention centre. To undertake this work, a capital construction and fit-up budget of $159 million will be required.

The breakdown to meet the capital construction and fit-up cost component is as follows:

• Federal Government - $50 million (36% of public sector funding),
• Provincial Government - $50 million (36% of public sector funding)
• City of Ottawa - $40 million (29% of public sector funding)
• The OCC – $19 million to be used to address the balance of capital and fit-up costs

The OCC’s share of the capital costs ($19 million) and an additional upset amount of between $10 to $20 million for project/transition related costs are to be financed by the OCC through the Ottawa Congress Centre’s operating revenues and from other sources related to the City’s Tourism industry and airport.

Federal and Provincial Funding Source

The source of the Federal and new Provincial Government contributions is unknown at this time. Federal funding for this project may be provided from the $4 billion Canada Strategic Infrastructure Fund (CSIF). This is one of many specific funding programs that reside under the Government of Canada’s “Building Canada” $33 billion infrastructure plan. The CSIF is designed for projects of major federal and regional significance that enhance quality of life and promote economic activity including tourism. Federal funding from the CSIF would not detract from Federal funding support to municipal infrastructure projects (local roads and bridges) supported by the $17 billion Gas Tax Fund under the same umbrella “Building Canada” infrastructure plan. Provincial funding in the amount of $30 million has already been received by the OCC. This money and its interest will be directed into the project once it receives approval. The funding source of the additional $15 million requested from the Province is not known at this time.

Given the current vision for a Tier II convention facility starting in 2008, the OCC and Hanscombe’s analysis has resulted in an order of magnitude increase in project costs from the previous proposal. Cost increases that are proposed to be shared with the funding partners will cover elements such as: construction inflation; demolition costs; and revenue loss for the closed operations during the demolition/construction period. Other transition costs will be the responsibility of the OCC and Province.

Municipal Fees and Charges

All development charges, building permit fees and other planning permit fees and approvals valued at approximately $4 to $4.5 million, will be paid for by the OCC.

Revenues and Private Sector Contributions

Operating and debt servicing for the OCC loan will be repaid from the revenues generated from a larger Tier II facility that will attract new business from the Canadian convention market, U.S. convention market for association and corporate business, international convention market, and the North American consumer and trade show market. In addition, the OCC is seeking revenue opportunities from the airport and tourism industry.

Specifically, private sector support in the amount of $1.5 million is being negotiated with organizations such as the Ottawa Gatineau Hotel Association (OGHA) and the Ottawa Airport Authority. Agreements are currently being negotiated and are to be completed prior to the execution of the City’s Contribution Funding Agreement. These funds will help offset the OCC’s debt repayment and ongoing operations.

PriceWaterhouseCoopers compiled financial projections of operating and capital costs for the reconstruction on behalf of the OCC. PriceWaterhouseCoopers concluded that based on their pro forma, which includes OCC event and tourism revenues, the new centre is estimated to generate $17 million in 2012 increasing to $28 million by 2020. This will result in annual operating surpluses starting in 2013 of $.5 million rising to $4.3 million by 2020. The operating surpluses and cash flow will be used to service the project debt.

The City hired KPMG to undertake an independent evaluation of the business plan. KPMG has indicated that the financial forecasts are reasonable and within the range likely to occur. However there remains some risk that these projections may not materialize and under the proposed structure, the Government of Ontario as owner of the facility would be impacted. To mitigate this risk, staff have included a recommendation in the report that speaks to the Province identifying that it will continue to “own” or demonstrate financial responsibility for OCC debts despite a possible change in the governance structure of the OCC.

Architecture and Engineering

The current proposal would demolish the existing facility except for the sub-grade levels. A new convention facility will then be constructed which aligns the OCC floor levels with the Rideau Centre and the roof top park. A design and construction agreement between the OCC and the VRC will address all building interface issues.

The current architecture requires a new vertical and horizontal expansion from ground level with over 200,000 square feet of rentable convention and meeting space. Over 100,000 square feet of contiguous convention space will be available on one floor (see Document 2). The vertical expansion will be an addition of two new floors. The horizontal expansion will be accomplished by extending the existing floor plates on two levels outward toward Colonel By Drive and Daly Avenue. The existing B1 and B2 Levels will also be extended outwards horizontally. Overall, the present design is much more in keeping with the City’s height limits and zoning requirements and can be addressed through the Committee of Adjustment.

Transportation

The new redevelopment option includes a proposed realignment of Colonel By Drive resulting in a one lane northbound cross section, south of Daly Avenue, in front of the convention centre with an enhanced pedestrian and landscaped environment. The planned road realignment is also intended to address current aggressive traffic conditions that are contributing to an unfriendly pedestrian environment along Colonel By Drive. This will also allow for upper level projections of the building over what is now the existing Colonel By roadway to achieve the floor space needed for the new facility.

On behalf of the OCC, Delcan has conducted a traffic analysis with support from Stantec Engineering. Solutions to assess the proposed realignment have been examined. The conclusion was that the existing two lane northbound cross section can be reduced, south of Daly Avenue, while maintaining acceptable traffic operations at the Colonel By/Daly Avenue intersection.

The City’s Traffic and Operations Branch have conducted an initial review of the narrowing of Colonel By Drive northbound from two lanes to one lane as proposed. In summary, northbound p.m. and a.m. traffic along Colonel By Drive is controlled by the intersection at Rideau and to a much lesser extent at the traffic signal at Daly Avenue. Consequently, as Rideau Street is the controlling intersection and serves as the bottleneck, the assessment to date is that the reduction of Colonel By Drive to one lane going north, south of Daly Avenue, will simply create a longer queue in the single lane, south of Daly Avenue, rather than distributed over two lanes. Provided there is a right-turn lane approaching Daly Avenue of adequate length and this intersection has appropriate signalization, the number of northbound lanes south of that point will not negatively impact on existing traffic patterns.

Based on the preliminary review undertaken, staff are satisfied that the concept of narrowing Colonel By Drive can be implemented without compromising the operation of the area road network. A roundabout at Colonel By Drive and Daly was also identified as a possible alternative for the Daily/Colonel By intersection. The specifics and details need to be pursued and planned by the OCC through the City’s and NCC’s Development Approvals process.

Downtown Urban Design Guidelines\NCC Core Sector Policies

The urban design strategy created jointly by the City and the NCC applies to the downtown precinct in which the OCC is located. The proposed Congress Centre will be subject to design review by the City’s Downtown Design Review Panel. However, due to restrictive covenants that have been placed on the Congress Centre/Rideau Centre complex, the ultimate design authority for this project will be the NCC. The NCC also has ultimate authority to any modifications to Colonel By Drive as an NCC Parkway.

The role of the City’s design review panel will be to provide comments to the NCC for their consideration in giving NCC design approval. In this regard, the NCC will also assess the project in the context of the NCC Core Sector policies. Parks Canada will also have input as it governs the operations of the Rideau Canal as a world heritage site.

Concerns expressed with the previous design as stated by the National Advisory Committee on Planning Design and Realty (ACPDR) pertained to: the large size of the building envelope; the pedestrian arrival experience; protection of views to the Rideau Canal and Parliament; and reinforcement of Colonel By Drive as a ceremonial route with landscape treatment on both sides.

Similar to the transportation review, the National Capital Commission (NCC) and the City of Ottawa have agreed to join forces to ensure a consistent approach to the design solution and to work closely with ACPDR. At present, plans are still in the concept design stage and the OCC is seeking approval on fundamental design elements that will make this a success prior to going into schematics.

Present objectives for ACPDR are consistent with those expressed on the previous proposal. Initial comments have been that the redevelopment of the Congress Centre should be designed to serve as a catalyst for key fundamental urban design changes in the vicinity and that OCC should ensure that the proposal responds to the following design considerations:

§ Rebalance the public realm in favour of pedestrians (public domain sidewalks and gracious forecourt to main entrance).

§ Recognize the location as a Capital entry and consider views to the Parliament and Chateau Laurier.

§ Enhances the Rideau Canal Frontage (vegetation and trees in a viable growth medium).

§ Consider appropriateness for planned pedestrian linkages to Government Conference Centre, National Arts Centre, Mackenzie King Bridge and Sparks Street.

An overall design solution will be articulated by the National Advisory Committee on Planning Design and Realty (ACPDR) and considered prior to final NCC directives. This is scheduled to be addressed and finalized in advance of any contribution funding agreements.

Lease with Viking Rideau Centre

At present, the $1.00 annual lease between the OCC and the VRC is similar to a retail tenant lease limiting the OCC to a prescribed space and requires the VRC support to make any alterations or to obtain a leasehold mortgage. Effective ownership was identified as a necessity to permit the OCC to finance debt, carry out its business and control its future. Overall, the previous development plan was severely hindered due to the inflexibility of the lease and had no process for resolving disputes.

Negotiations for a new long-term land lease began in June 2007 and continued to September 2007. A long-term 80-year land lease is being finalized by the OCC and the VRC. The new lease redefines air and sub-surface rights and addresses any redevelopment or internal changes in the future. It will also permit the OCC to obtain a leasehold mortgage, permit ancillary uses, and allow internal renovations and a dispute resolution process leading to mediation. As part of this lease, a design development and construction agreement will be required between the two organizations to spell out how redevelopment will take place.

As a condition of approval, the City is asking for a copy of the finalized lease to ensure the terms of the lease are satisfactory to the City as well as to review issues pertaining to the design, development and construction agreement.

Governance Model

The OCC is a Crown Agency as defined under the Public Service Act and in accordance with the Ottawa Congress Centre Act, 1988. This means that the OCC is governed by a Board of Directors accountable to the Ontario Ministry of Tourism but administratively independent of the Government of Ontario in its day-to-day operations. Generally, operations are not funded by the Government but the Government of Ontario is the “owner” and ultimately accountable for any financial liabilities or debts that the OCC attracts. Given the Government of Ontario’s long-term exposure to liability as owner, it has a vested interest in ongoing funding strategies presented by the OCC that will minimize its risk. This includes considering an alternative governance model such as that of the Ottawa Airport Authority, if it could be proven to enhance economic success and sustainability of the OCC. If an alternative governance model were to be pursued similar to the Ottawa Airport Authority, changes to the Ottawa Congress Centre Act would be required that may no longer leave the OCC as a Crown Agent. In any alternative governance model, the OCC would have to remain non-profit to retain its tax-exempt status.

If an alternative governance model is pursued by the OCC, it will take time and must be proven to be beneficial. In the interim, the Government of Ontario will be required to provide parent guarantees to support the construction debt financing of the OCC. This requires authority issued by the Ontario Cabinet (Ontario Financing Authority Section 28) to provide security to the lender as if it were provincial debt. As well, to ensure the City is widely protected from any substantial future changes to the Ottawa Congress Centre Act, the City will be seeking written assurances from the Government of Ontario that it will continue to “own” and/or satisfactorily demonstrate financial responsibility for OCC debts under existing or future governance models as a component of the City’s funding contribution agreement.

LEEDS (Leadership in Energy and Environmental Design) Silver Certification

With staff’s support and encouragement, OCC intends to undertake a triple bottom line approach on this project treating social (discussions currently underway with the Ward Councillor and OCC) and environmental considerations on an equal footing with economic considerations. On the environmental front advanced environmental design and construction will be incorporated into the redevelopment to meet a number of objectives including:

§ Minimizing greenhouse gas emissions;

§ Water efficiency to reduce consumption and address storm water run-off; (e.g. green roof technology)

§ Healthy Indoor environment through ventilation, daylight and building materials;

§ Restoration of green space at ground level and on the roof top;

§ Recycling and waste reduction program

§ Environmental Procurement Policies and priorities; and

§ Energy efficiency and renewable energy

Parking

The Design and Construction Agreement between the OCC and the VRC will deal with parking and building interface issues with the Rideau Centre. This is a mechanism developed in response to previous constraints between the two parties concerning shared parking and construction issues. Under the City of Ottawa Comprehensive Zoning By-law, all the parking provided by the Rideau Centre can be used to satisfy the parking of both the Congress Centre and the Rideau Centre. Irrespective of the zoning by-law, the City’s Official Plan policies support reduced parking in the downtown. S.2.3.1 (Policy 42) of the Official Plan states that - "The City maintain the following strategic objectives related to parking: a) To provide short-term parking that supports the vital interests of local businesses/ institutions and tourism destinations; b) To limit the supply of long-term parking to levels that balance the needs of automobile users with the City's transit ridership objectives, while minimizing spill-over parking in residential areas; c) To minimize the amount of land devoted to parking uses through shared parking arrangements and the use of parking structures.

The City’s Parking Management Strategy has also instigated changes to the City’s comprehensive zoning by-law reducing parking requirements for long-term parking where specific criteria are satisfied that contribute to walking, cycling and transit use and for uses within 600 metres of a transit station.

To ensure the current parking in the Rideau Centre is maintained and available over the long term, the VRC will be renovating its red garage, which provides a parking supply of approximately 700 spaces. Renovation activity is scheduled for January 2008.

Mass Transit Planning

The City is currently investigating the feasibility of a tunnel under the downtown to accommodate transit demands. An Environmental Assessment (EA) is being initiated to identify potential constraints and opportunities for a tunnel. An underground transit station at or near the OCC site is a viable option that will be considered through the EA. The City also recently approved Transit Oriented Development Guidelines for new development. These guidelines provide direction to the design and review processes for plans of subdivision, site plan control, rezoning and Official Plan Amendments and encourage an approach that blends transit with urban planning and provides context for detailed site-specific planning, design and engineering solutions.

In this case, the guidelines are particularly pertinent to the quality and design of the public realm including spaces along public sidewalks and internal pedestrian walkways leading to and from transit stops or stations. Consequently, all expansion plans shall address the principles of the transit Oriented Development Guidelines, particularly if the City proceeds with an underground transit system in the downtown or identifies an alternative mass transit solution. This requires an appropriate identification of funds by the OCC for implementing planning and design solutions. The City is specifying 1.5 % of the final construction budget of the OCC for purposes of implementing measures that will appropriately facilitate linkages to a transit station at or near this location.

CONSULTATION

The City’s Economic Strategy, Official Plan and the City’s Corporate Plan, developed in consultation with the community and The Ottawa Partnership (TOP) support Ottawa’s status as an international convention and tourism destination. The OCC has also undergone extensive consultation with the tourism industry, meeting planners and stakeholders as part of the OCC Redevelopment Feasibility Study initiated earlier this year and completed in September 2007.

A comprehensive communications plan has also been developed for the OCC with a set of action plans. The Plan was prepared by GBA communication consultants who have identified key audiences and communications framework. The communications framework is designed to step up communications strategically, effectively and immediately to see the project through from conception to completion. The OCC is currently undergoing an eight-week campaign with a series of full-page weekly ads in the Ottawa Citizen to communicate the redevelopment proposal to the public.

The Ottawa Chamber of Commerce, the downtown Business Improvement Area Associations, Ottawa Tourism the Ottawa Airport Authority and the Ottawa Gatineau Hotel Association and Algonquin College have endorsed the redevelopment proposal.

FINANCIAL IMPLICATIONS

On June 25^th 2003 Council approved motion No. 57/4 to provide a contribution of $25 million to the OCC expansion project. The motion also removed previous conditions associated with this project with the exception that written confirmation be received from the Government of Ontario indicating they are sole owner of the OCC. In accordance with this motion, $25 million of debt authority has been established and an account (903640) has been setup for cash flow purposes.

An additional debt authority for $15 million is required in accordance with the current funding contribution request made by the OCC and its approval will be subject to the outcome of the 2008 budget exercise. Should this funding be approved this amount will be placed in the City’s Strategic Initiatives Fund. This fund is established for Council-directed initiatives identified in the City Corporate Plan and for projects that implement City master plans and the Ottawa 20/20 Plans.

The estimated costs of payments on a $40 million debenture issued by the City at current rates over 25 years would be about $2.9 million.

As well staff have recommended that 1.5 percent of the total capital funding requirements be used towards implementing the City’s transit oriented guidelines, as per recommendation 4(m) of this report, as a means of offsetting these costs and to assist in meeting transit objectives. The City’s Funding Contribution Agreement with the OCC will specify how this money is to be directed towards transit related infrastructure.

No additional property taxes would be realized as a result of the proposed OCC expansion itself. Under Section 10.1 of the Ottawa Congress Centre Act, 1988, the crown agency is directly exempt from municipal property taxes as long as the facility is used as a convention centre.

To ensure the public funding for this project is expended in an open, transparent and fair way, staff have required the OCC undertake a competitive process, pre-approved by the City for the acquisition of all equipment, services, supplies used in the building and during the construction.

SUPPORTING DOCUMENTATION

Document 1 – Motion 57/4

Document 2 – Design Concept Plans

DISPOSITION

The Planning, Transit and the Environment Department will prepare a letter to be sent to the Federal and Provincial governments under the Mayor’s signature indicating the City’s support for the Ottawa Congress Centre Project.

Legal Services will initiate preparation of a Funding Contribution Agreement to be executed by the City Manager when all of the recommendations in this report are satisfied.

MOTION 57/4 DOCUMENT 1

Moved by Councillor G. Hunter

Seconded by Councillor J. Harder

WHEREAS the City of Ottawa had made its support for the Congress Centre expansion conditional on equivalent funding from the Federal and Provincial governments and on a sizeable contribution from the private sectors;

AND WHEREAS those contributions have now been secured and are on the table;

AND WHEREAS the Congress Centre expansion plans are well developed and ready to proceed while transit expansion plans are not as well advanced;

THEREFORE BE IT RESOLVED that Ottawa City Council re-affirm its commitment from March 27, 2002 and March 26, 2003 to provide a contribution of $25 million for the expansion of the Ottawa Congress Centre, to be paid by a debenture in that amount, that will be re-paid by the incremental tax revenue generated by the expansion of the Ottawa Congress Centre;

AND further be it resolved that this contribution be provided to the Ottawa Congress Centre upon the receipt of a building permit for the project by the Ottawa Congress Centre;

AND FURTHER BE IT RESOLVED that previous conditions be rescinded but that the City’s commitment remain conditional upon Provincial Cabinet confirming its sole ownership of the Ottawa Congress Centre, and confirming that it has full and sole financial responsibility for any cost overruns, budgetary shortfalls and any and all other financial obligations relating to the Ottawa Congress Centre.

CARRIED

CONCEPT DESIGN PLANS DOCUMENT 2