Report
to/Rapport au :
Comité des transports
and Council / et au Conseil
10 August 2009 / le 10 août 2009
Submitted
by/Soumis par : Nancy Schepers, Deputy City Manager
Directrice municipale adjointe,
Infrastructure Services and Community
Sustainability
Services d’infrastructure et
Viabilité des collectivités
Contact/Personne-ressource: Michael Murr, Acting Director/Directeur intérimaire,
Community and Sustainability Services/Services de viabilité et des
collectivités
(613)
580-2424, 25195 michael.murr@ottawa.ca
That Transportation Committee recommend that Council:
1. Approve the City of Ottawa Integrated Street Furniture Policy and Design Guidelines as discussed in this report and set out in Document 1;
2. Approve the release of a Request for Proposal ("RFP") in accordance with the strategy and recommended key terms discussed in this report and direct that no further street furniture elements be separated from the ISFP to ensure the success of the RFP and the resulting program;
3. Limit advertising on street furniture elements to transit shelters and information and way finding kiosks; and
4. Direct staff to report to Council in the first quarter of 2010 on the outcome of the RFP and for final approval of the preferred proponent.
Le Comité des transports recommande au
Conseil :
1.
d’approuver
la politique sur le mobilier urbain de la ville d’Ottawa et les directives
relatives à la conception qui sont abordées dans le présent rapport et
présentées dans le document 1;
2.
d’approuver
la publication d’une demande de proposition (« DP ») conforme à la
stratégie énoncée et aux conditions clés recommandées dans le présent rapport
et d’ordonner qu’aucun élément de mobilier urbain ne soit retiré du Programme
intégré de mobilier urbain (PIMU) afin de garantir le succès de la DP et du
programme en découlant;
3.
de
limiter la publicité aux abribus et aux kiosques d’information et de
signalisation; et
4.
de
charger le personnel de faire rapport au Conseil au cours du premier trimestre
de 2010 sur les résultats de la DP et sur l’approbation finale de l’auteur de
la proposition choisi.
This report represents the third of four key milestones associated with the ISFP. It reports on the work undertaken since February 2009 towards the development of an integrated program for the provision of street furniture elements in the City. Specifically, the report discusses the following:
· City of Ottawa Integrated Street Furniture Policy and Design Guidelines (a document that details the placement and design criteria of street furniture elements)
· RFP strategy
· Results and implications of a business case analysis
· Continued consultations
· Litter and recycling issues
· An organizational unit responsible for the ISFP
Over the previous five months, several
actions have been undertaken in order to complete the work listed above. These
include consultation with a number of public and stakeholder groups through
initiatives such as individual meetings, participation at advisory committee
meetings, and a Design and Functionality Workshop. Staff continue to conduct
best practice reviews and extensive research in order to arrive at the final
stages of this project. In addition, staff have taken the necessary steps to
remove the bicycle parking component from the ISFP, which Council directed at
its 10 February 2009 meeting be excluded from the program.
The report requests the approval of the City of Ottawa Integrated Street Furniture Policy and Design Guidelines document. It describes the design and placement criteria for each element of furniture as well as the role of advertising, advertising exclusivity, and any advertising restrictions. Potential proponents, when submitting their response to the RFPs, must adhere to this document and the Successful Proponent will be required to comply with it for the 20-year contract term. The document will also serve as a reference guide for staff making future decisions related to street furniture. Although bicycle parking was removed from the ISFP, the City will use this policy to guide the design of parking to ensure consistency with all other furniture.
The report also requests the approval of the RFP strategy and recommends that no other street furniture elements be removed from the program. The request for no further removal of furniture elements is in response to the removal of the bicycle parking component. Any further removal of furniture elements will negatively affect the ability of the City to receive quality proposals to the RFP and will significantly diminish revenues received by the City. In addition, it could result in an uncoordinated design of street furniture elements that this program aims to eliminate from our current City streetscapes.
Prior to the completion of this report, an external business case analysis was conducted to determine the effects of the economic downturn on the ISFP and to assess whether the number of street furniture elements and advertising levels proposed through the program creates an attractive proposition to bidders. The study indicated that although the current economic uncertainty will not have a major affect on the project, the amount of advertising on street furniture significantly impacts the success of the program. For this reason, staff recommend that advertising be limited to transit shelters and information and way-finding kiosks. Limiting advertising to these two elements will attract more quality bids, ensure accessibility for small businesses, increase revenue potential, and ensure less visual clutter.
The report also discusses litter and recyclable collection related to the ISFP. Based on direction received during the 10 September 2008 Council meeting, the City will assume the responsibility of managing on-street litter and recycling receptacles. Staff envision this being done through a Request for Tender prior to the implementation of the ISFP.
A report will be brought to Committee and Council in the first quarter of 2010 for final approval of the preferred proponent. At this time, additional information on the organizational unit responsible for the ISFP will be provided.
Le présent rapport constitue la troisième des
quatre étapes jalons du Programme intégré de mobilier urbain (PIMU). Il rend
compte des travaux entrepris depuis février 2009 dans le cadre de l’élaboration
d’un programme intégré destiné à fournir divers éléments de mobilier urbain sur
le territoire municipal.
Plus précisément, ce rapport traite
de ce qui suit :
·
Le document intitulé City of Ottawa Integrated
Street Furniture Policy and Design Guidelines (Politique de la Ville d’Ottawa
sur le mobilier urbain intégré et directives relatives à la conception) (un document qui explique en détail
les critères de conception et de mise en place des éléments de mobilier urbain)
·
La
stratégie pour la demande de proposition
·
Les
résultats et les répercussions pour la réalisation d’une analyse de
rentabilisation
·
La
poursuite des consultations
·
Les
problèmes concernant les contenants à ordures et à recyclage
·
L’unité
organisationnelle responsable du PIMU
Plusieurs mesures ont
été entreprises au cours des cinq mois précédents afin de réaliser les tâches
énumérées ci-dessus. Nous avons notamment mené des consultations auprès d’un
certain nombre de groupes de membres du public et de parties intéressées, au
moyen de rencontres individuelles, en participant aux rencontres des comités
consultatifs et en ainsi qu’à un atelier sur la conception et la
fonctionnalité. Le personnel poursuit ses recherches et l’examen des pratiques
exemplaires en vue de finaliser ce projet. De plus, le personnel a pris les
mesures nécessaires pour retirer l’élément aire de stationnement pour vélos du
PIMU, élément que le Conseil avait recommandé d’exclure du programme à sa
réunion du 19 février 2009
Dans le rapport, on demande l’approbation du
document City of Ottawa Integrated
Street Furniture Policy and Design Guidelines (Politique de la Ville
d’Ottawa sur le mobilier urbain intégré et directives pour la conception).
Il définit les critères de conception et de mise en place pour chaque élément de mobilier ainsi que le
rôle de la publicité, de l’exclusivité publicitaire et de toutes restrictions
relatives à la publicité. Les auteurs de proposition potentiels, lorsqu’ils
présenteront leur réponse à la demande de proposition, doivent se conformer aux
critères énoncés dans ce document. De plus, l’auteur de proposition qui sera
choisi devra s’y conformer pour les 20 années du contrat. Le document servira
également de référence lorsque le personnel devra prendre des décisions
relatives au mobilier urbain. Bien que l’élément aire de stationnement de vélo
ait été retiré du PIMU, la ville utilisera cette politique pour guider la
conception du stationnement afin d’assurer l’uniformité avec tous les autres mobiliers.
Dans le rapport, on demande également
l’approbation de la stratégie portant sur
la demande de proposition; de plus, on recommande qu’aucun autre élément
de mobilier urbain ne soit retiré du programme. Cette demande de ne pas retirer
des éléments de mobilier est faite en réponse au retrait de l’aire de
stationnement de vélos du programme. On croit que tout autre retrait d’élément
de mobilier découragerait la présentation de soumissions de qualité en réponse
à la demande de proposition de la Ville et se traduirait par une baisse
importante de revenus pour la Ville. De plus, avec d’autres retraits, il existe
un risque que la conception des éléments mobiliers manque d’uniformité,
problème que le programme vise justement à éliminer du paysage urbain actuel.
Avant la finalisation du présent rapport, une
analyse de rentabilisation externe a été effectuée pour évaluer les
conséquences de la récession sur le PIMU et déterminer si le nombre d’éléments
de mobilier urbain et les niveaux de publicité proposés dans le cadre du
programme constituent une proposition attrayante pour les soumissionnaires.
L’étude conclut que bien que l’incertitude économique n’aura pas d’incidence
importante sur le projet, la quantité d’éléments publicitaires permis sur le
mobilier urbain aura une influence significative sur le succès de ce programme.
Pour cette raison, le personnel recommande que la publicité soit limitée aux
abribus et aux kiosques d’information et de signalisation. Le fait de limiter
la publicité à ces deux éléments constitue un argument de force pour attirer
des propositions de qualité, assure l’accessibilité aux petites entreprises,
augmente le potentiel de revenus et réduit grandement le fouillis visuel.
Le rapport aborde également la question de la
cueillette des ordures et des matières recyclables relativement au PIMU. Selon
les directives reçues au cours de la réunion du 10 septembre 2008 du Conseil,
la Ville assumera la responsabilité de la gestion des contenants à ordure et à
recyclage installés sur la rue. Le personnel prévoit que cet aspect sera réglé
au moyen d’une demande de soumission avant la mise en œuvre du PIMU.
Un rapport sera présenté au Comité et au
Conseil au premier trimestre de 2010 pour l’approbation finale du proposant
choisi. À cette date, on fournira également des renseignements supplémentaires
sur l’unité organisationnelle qui sera responsable du PIMU.
Overview
This
report represents the third of four key milestones associated with the
ISFP. These milestones include the approval
of three legislative reports and the issuance of a RFP to design, install, and
maintain street furniture elements in Ottawa’s right of way.
At its meeting of 10 September 2008, Council approved the first report, entitled Integrated Street Furniture Program - Guiding Principles and Work Program (ACS2008-PWS-DCM-0001). This report provided the foundation for the development of the ISFP. As part of this report, Council approved a set of guiding principles upon which the program would be based. The principles were to be further developed in consultation with the community and best practice research. Staff were directed to report back on the results of consultation along with recommendations regarding specific furniture elements and levels of advertising. The guiding principles were approved as:
· Improve the Streetscape and Preserve Street Identity
· Provide a service
·
Enhance a service
·
Ensure and encompass Accessibility,
Environmental Sustainability, Safety and Technological Innovation (approved at
February 11, 2009 meeting)
· Improve Coordination
· Offset capital and operating costs
· Generate Revenue
At its meeting of 11 February 2009, Council approved a second report entitled Integrated Street Furniture Program- Project Update and Way Forward (ACS2009-ICS-ECO0008). The report details the results of public consultation and best practice research.
Research
and consultation results suggested the addition of a guiding principle to
reflect accessibility, the environment, and technology advances. The report
also details the elements for inclusion in the program and on which of those
elements advertising should be permitted. The following elements are to be
included in the ISFP:
· transit shelters
· litter and recycling receptacles
·
multiple
publication boxes
· benches
· information and way-finding kiosks
Of
these elements, advertising is to be permitted only on transit shelters,
information and way-finding kiosks, and bicycle parking. Where numerous
elements are clustered in one location, only one element would be permitted to
contain advertising. Council also carried a motion to remove bicycle parking
from the program and directed staff to reconsider advertising on litter and
recycling receptacles and benches.
The second report also discusses:
· the advertising-based funding model upon which the ISFP will operate;
· advertising permissions and exclusivity; and
· the requirement for an extension in the implementation of the program to July 2011.
The
extension was approved based on the state of the economy and the need to
further assess the ISFP business case. Staff also reported on consultations
that took place with proponents and the public, both of whom reached a
consensus that the City should be responsible for litter and recycling
collection for the duration of the program. Upon confirmation of this
direction, staff was also asked to investigate coordinating the litter and
recycling collection with the yellow bag program.
Actions Taken
In accordance with Council approval and direction, the following actions have taken place since the last ISFP report in February 2009:
·
Contract Extension Negotiations. At its meeting of 11 February 2009,
Council approved the request for extension of the current ISFP contracts by an
additional year to 1 July 2011. The need for the extension is based on numerous
factors including economic uncertainty, proponent feedback, and the importance
of furniture design. To this end, staff is presently negotiating with current
street furniture contractors to extend existing contracts by one year to ensure
that the City maintains an appropriate supply of furniture until the new ISFP
is implemented. Council and all Business Improvement Areas (BIAs) have been
consulted on their interim furniture needs.
·
Completion of the Policy and Design
Guidelines. This document, entitled City of
Ottawa Integrated Street Furniture Policy and Design Guidelines, will be
included as an appendix to the ISFP RFP.
Its purpose is to provide potential proponents with furniture design and
placement requirements for their bid submissions. It will also be used
throughout the duration of the ISFP contract to guide future furniture design
and placement decisions. This document is attached as Document 1 and is
discussed in more detail later in this report.
·
Removal of Bicycle Parking. At its meeting of 11 February 2009, Council carried a motion to
remove the bicycle parking component from the ISFP. Staff has taken this
direction and will exclude bicycle parking from the ISFP RFP. A separate RFP
specific to bicycle parking with advertising will be issued at a later date.
The bicycle parking RFP will require the successful proponent to design parking
elements that adhere to the Policy and Design Guidelines identified in this
report to ensure that they complement and properly integrate with the ISFP
furniture elements.
·
Completion of Business Case
Analysis. In light
of the current state of the economy and to ensure due diligence, an external
assessment was completed to advise staff on the ISFP business case. The purpose
of this analysis was to determine the achievability of the expectations of the
ISFP and, based on the results, provide recommendations for the design of an
RFP that is attractive to bidders. The analysis also informed the development
of the Policy and Design Guidelines and the RFP. The specific results of this
analysis and implications are discussed later in this report.
· Continued Consultations. Consultation with external stakeholders continues to be one of the key success factors of this program. Accordingly, individual consultation has taken place with each BIA in order to fully appreciate their needs. In addition, various Advisory Committees, the Arts and Design Community, the National Capital Commission, Police Services as well as experts on accessibility and internal staff, were all consulted on the development of the City of Ottawa Integrated Street Furniture Policy and Design Guidelines document.
Purpose of Report
The purpose of this report is to recommend approval of the following:
· the City of Ottawa Integrated Street Furniture Policy and Design Guidelines document;
· the RFP strategy, its recommended key terms and its release and;
· the street furniture elements that will contain advertising.
The report also details the results of the business case analysis, responds to outstanding litter and recyclable collection issues, and discusses the addition of an organizational unit responsible for the implementation and ongoing operations of the ISFP.
City of Ottawa Integrated Street Furniture Policy and Design Guidelines
Purpose of the Guidelines
Recommendation #1 - Approve the City of Ottawa Integrated Street Furniture Policy and Design Guidelines as discussed in this report and set out in Document 1.
Development of the Guidelines
At its
meeting of 11 February 2009, Council approved both the
guiding principles and the street furniture elements that form the basis of the
ISFP.
The guidelines are based on the results of recommendations gathered at focus group sessions involving various stakeholder groups. These sessions took place October 2008. The stakeholders were consulted on the guiding principles of the program along with the street furniture elements listed for inclusion in the ISFP.
The City also hosted a Design and Functionality Workshop on 17 February 2009. In this workshop, City of Ottawa staff, Ottawa’s professional design community, Police Services, the National Capital Commission, and experts on accessibility participated and offered ideas and opinions on furniture design, placement, and functionality. Several draft versions of the document were also distributed to staff and Advisory Committees for feedback. Many of the ideas generated at the workshop and suggestions received from draft reviews are included as part of the guidelines.
RFP Strategy
RFP Overview and Process
Staff
has developed an RFP for the ISFP for release in September 2009. Together with
the City of Ottawa Integrated Street Furniture Policy and Design Guidelines and
the results of consultation, the RFP details the requirements and
specifications of the program for proponents. The first part of the second
recommendation of this report is that Council authorize staff to issue an RFP:
Recommendation # 2 (First
Part) – Approve the release of a Request for Proposal (“RFP”) in accordance with the strategy and
recommended key terms discussed in this report.
The
following table outlines the timelines associated with the release and
evaluation of the RFP.
No Further Removal of Elements from the ISFP RFP
Recommendation #2 (Second Part) - and direct that no further street furniture elements be separated from the ISFP to ensure success of the RFP and the resulting program.
Inventory Replacement and Growth
Evaluation Criteria
The proposals received in response to this competitive bid process will be evaluated against mandatory submission requirements as well as criteria in the following three rated areas:
· qualifications
· technical, functional, and design
· financial
Proposals are required to achieve a minimum grade in each rated criteria in order to receive further consideration. The percentage score within each rated criteria has been aligned to the approved guiding principles of the program. For example, one of the highest rated guiding principles was the importance of improving the streetscape and one of the lowest rated guiding principles was revenue generation. Therefore the scoring on the quality of the furniture should outweigh the scoring of the revenue generated. As such, the financial points allocated are worth 25% of the proponents overall score, and as a result, the highest revenue proposal may not be the selected proponent.
Given the complex nature of this project and the level of acceptance required for successful implementation of this new program, specific evaluation teams will be formed with both internal staff, external experts, and stakeholders best qualified to evaluate the required steps. A lead from Supply Management and the Fairness Commissioner will attend all evaluation sessions; however, they will not be involved in the scoring process.
The following outlines the categories for review, the overall objectives for each, and the evaluation teams:
· Mandatory Submission Requirements. This step confirms whether the proponent has provided the mandatory documents as stated and required by the City. City staff in Supply Management will use a pass/fail scale for this assessment. Examples of Mandatory Submission Requirements include a Bid Deposit, independent third party evidence of the Proponent’s ability to obtain the Performance Security, and Insurance stipulated in the RFP document.
· Qualifications Evaluation. This step serves to evaluate the documents received under the aforementioned Mandatory Submission step as well as other criteria such as the relevant experience of the Proponent’s proposed team and its financial capability to undertake a program of this magnitude. It is anticipated that this review team will consist of staff from Finance, Planning and Growth Management, Public Works, Infrastructure Services, and an external accounting firm.
· Technical, Functional, and Design Review. Criteria evaluated in this step include conformance with Council’s approved guiding principles, the specified technical requirements, and the Policy and Design Guidelines. Special attention will be paid to accessibility requirements, suitability to the intended purpose, quality control procedures, accessibility for small businesses, levels of customization and operations and maintenance plans. It is anticipated that staff from Infrastructure Services, Public Works, Transit Services, Planning and Growth Management, and Environmental Services will participate in the evaluation of this step.
In addition to the Technical, Functional and Design review team, an independent Design Jury comprised of local urban designers, planners, architects, artists, landscape architects, industrial designers, and one BIA representative will also review the design submissions and award the points associated with the Design section. The Design Jury will be aided in their evaluation by the Technical Evaluation Team’s Evaluation Summary (excluding scoring) to ensure that the Technical and Functional requirements scored by the latter are factored into their assessment. For example, the Design Jury may prefer the litter and recycling receptacle design of a proponent, but the technical evaluation may have identified non-compliance with accessibility requirements.
The Design Jury will evaluate criteria such as the scale of the proposed furniture, modularity, coordination of elements, capability for customization and branding, construction materials and finishes, and adaptability to future new technologies.
· Financial Evaluation. The evaluation conducted in this step may include awarding points to each proposal’s minimum guaranteed revenue to the City schedule as well as the percentage of gross revenue payable to the City. This review team will be comprised of representation from Finance, and Risk Management and may include the external accounting firm identified in the qualifications team.
Selected Proposal
The proposal
selected as best meeting the City’s requirements will be brought forward to
City Council in February 2010 for approval to proceed with negotiating a final
form of legal agreement. This step will see the City and proponent undertake
limited negotiations within a specified time period the final terms and
conditions of the proposal and legal agreement, based on the ISFP Agreement
appended to the RFP as discussed further below. Should an agreement not be
reached within the specified time period, the City reserves the right to
approach and deal with another responsive proponent.
ISFP Legal Agreement
A form of agreement (the ISFP Agreement) describing
the ISFP to be undertaken by the successful proponent with the City will be
included as an appendix to the RFP. While the ISFP Agreement appended to the
RFP will be substantially in its final form, the RFP will invite proponents
responding to the RFP to provide comments and suggested revisions to the ISFP
Agreement that they might consider as important or necessary for consideration
by the City.
While the City would not be obligated to accept any
or all of these comments and/or suggested revisions, it would consider them
before negotiating and settling the final form of the ISFP Agreement with the
successful proponent. As a condition to responding to the RFP, each proponent
must confirm its agreement to enter into a final ISFP Agreement on
substantially those terms and conditions as are contained in the ISFP
Agreement. It is believed that providing proponents with a final form or
near-final form ISFP Agreement with the RFP will accelerate, simplify, and
limit the negotiations needed for completion of a final form of ISFP Agreement
with the successful proponent. This
strategy was successfully employed by the City of Toronto when it undertook its
recent procurement process for its Integrated Street Furniture Program.
It is recommended that the ISFP Agreement would
include, but not be limited to, the following key terms:
·
The term of
the ISFP Agreement will be 20 years.
·
The ISFP
will be proponent-run subject to certain City-mandated protocols (such as a
supplier code of conduct, equity and diversity policies, and ethical purchasing
policies).
·
The design,
installation, and maintenance of the ISFP will be based on predetermined
protocols.
·
Local
business advertising provisions will be addressed.
·
The City
will be entitled to five percent of advertising space for public service
advertising.
·
The City
will be entitled to share in gross revenues of the advertising component of the
ISFP, with a minimum annual amount guaranteed in respect of such share.
·
A fixed
amount of the City’s development costs will be reimbursed by the successful
proponent.
·
The
successful proponent will maintain adequate performance security to guarantee
its obligations under the final ISFP Agreement.
·
The ISFP
Agreement may be terminated by the City for breach thereof by the successful
proponent, following a reasonable opportunity for the successful proponent to
remedy such breach. The ISFP Agreement may also be terminated upon payment by
the City to the successful proponent of a fixed fee (to be determined and
possibly following the elapse of part of the term).
·
Any
disputes under the ISFP Agreement will be settled by informal negotiation by
the parties, followed by mediation by an expert appointed by the parties, and
then by arbitration, if required. Arbitration in respect of matters that are
less than a fixed monetary threshold value will be final and binding on the
parties.
·
At the
midpoint of the ISFP Agreement, the proponent may be required to submit a
proposal to modernize or retrofit the existing street furniture elements should
advancements in materials or technology deem it worthwhile.
·
During the
term of the ISFP Agreement, ownership of all existing and new street furniture
elements will rest with the successful proponent. Upon termination or expiry of
the Agreement, ownership of all right, title, and interest in the street
furniture elements and unique street furniture element designs will be
transferred to the City. This will ensure that at the end of the Agreement the
City will own the furniture.
Preferred Proponent
Upon completion of
the Proposal Evaluations in the RFP process, staff will return to Council in Q1
2010 for final approval of the preferred proponent.
Upon approval, staff
will commence the limited contract negotiations with the preferred proponent as
outlined above and work with it to prepare for the installation and maintenance
of the furniture.
Business Case Analysis
The
purpose of the external business case analysis is to determine the impact of
the current economic downturn on the ISFP and to assess whether the number of
street furniture elements and advertising levels proposed through the program
creates an attractive proposition to bidders. The analysis also examined the
consequences of removing the bicycle component from the ISFP, which was
discussed in the RFP section of this report, and the effect of separate
advertising programs administered by the City on the ISFP.
The
results of this analysis directed the content development of the City of
Ottawa Integrated Street Furniture Policy and Design Guidelines document,
the RFP, and more specifically, the second and third recommendations of this
report.
R.E. Millward and
Associates completed this assessment through the guidance of an advertising
consultant with former experience in the Canadian outdoor advertising market.
The highlights of the study and its impact on the City of Ottawa’s
Integrated Street Furniture Policy and Design Guidelines, the
RFP, and resulting recommendations are discussed in the next sections.
The ISFP RFP and Current Economic Uncertainty
At its 11 February 2009 meeting, Council agreed to delay the implementation of the rollout of furniture by one year, to 1 July 2011 in order to study the potential impacts and decreased value placed by proponents on the City street furniture assets during an economic downturn.
Although the state of the economy cannot be ignored, the business case analysis indicated that the proposed new implementation target date is an appropriate time to release the RFP. The new schedule provides proponents with ample time to respond to the RFP and allows more time for the economy to improve. Many sources have noted that we have already begun to experience positive changes in our economy. This is a 20-year program that presents a long-term investment for proponents who will be required to account for market fluctuations in their proposals.
Proposed Street Furniture Elements and Level of Advertising
To ensure that the proposed scope of work provided to proponents in the RFP is feasible and maximizes value to the City, staff also requested an analysis pertaining to the number of street furniture elements to be rolled-out during the 20-year term and the amount of advertising to be included on the elements.
The results of the analysis suggest that the number of street furniture elements proposed by the City is adequate; however, bidders will be more inclined to bid on the RFP if the amount of advertising is limited. For this reason, the following recommendation is being made:
Recommendation #3 - Limit advertising on street furniture elements to transit shelters and information and way-finding kiosks.
The reasons for this recommendation are twofold and include the need to limit the amount of outdoor advertising in Ottawa and Ottawa’s position in the advertising market.
First, it is important to understand that more advertising does not necessarily equate to more revenue for the City or to the advertising company. In fact, the opposite is true in that the greater the number of advertisements in the public realm, the less effective each ad. More advertisements create visual clutter and resultantly, the customer’s attention becomes lost and the ads become ineffective in reaching their desired audience. Stated differently, the market becomes saturated with outdoor advertising and the result is outdoor advertising that is less successful and less valuable.
In looking at the total number of ad faces in the Canadian market, Ottawa indexes at the highest. Compared to Vancouver that has 1.34 ad faces/1000 people and Toronto with 1.03 ad faces/1000 people, Ottawa places first in the country with 1.36 ad faces/1000 people. There are currently numerous street level advertising venues in Ottawa that all compete for the same audience and equally contribute to visual clutter. These include ads on litter and recycling receptacles, benches, bicycle parking units, four sided pillars in parking lots, and media storefront signs. Not all of these ads contribute to City revenue. Of these elements, the ones that currently provide revenue to the City include litter and recycling receptacles, benches, bicycle parking units, and transit shelters. Only transit shelters provide a significant amount of revenue to the City and at present they have the lowest occupancy rates of ads. The other elements provide negligible amounts of revenue but have high occupancy rates that contribute to increased clutter.
Second, Ottawa is the sixth-ranked city in Canada in the advertising market. By industry standards this makes Ottawa a “B” city. During an economic downturn, advertising dollars are generally reduced in B markets and focus is typically directed to the top two or three markets in the country. This suggests that in order to attract quality bids, Ottawa must ensure that it has an attractive business case relative to the top three markets.
Based on these research results, it is anticipated that limiting advertising to two key street furniture items (transit shelters and information and way-finding kiosks) results in an RFP that is more attractive to proponents. For the ISFP, this research indicates that less advertising is required and of the advertising that is needed that it be included on elements that provide the most significant return (transit shelters) and those that that create the least amount of clutter (information and way-finding kiosks). Moreover, proponents will be required to describe how advertisements on transit shelters and information and way-finding kiosks will be accessible to local business advertising.
Limiting advertising to these two elements also ensures less visual clutter on the streets, which adheres to the program’s guiding principles, and as previously stated, creates more revenue for the City. Transit shelters are the medium through which the most revenue is generated so it makes sense to advertise on these elements and to elevate the number of ads that currently sit at low occupancy rates. Furthermore, public consultations with all stakeholders have shown that advertisements in transit shelters are a commonly accepted practice. Again, we will ensure through the RFP process that small businesses will have access and opportunity to participate in the ISFP.
Other City Advertising Initiatives
There are a number
of advertising initiatives with upcoming RFPs in the City including the bicycle
parking program, billboard advertising program, bus advertising, and transit
station advertising. All of these programs are outdoor advertising initiatives,
which have the ability to affect the success of each other given that outdoor
advertising revenue is not unlimited. Increasing outdoor advertising space at
the street level does not necessarily generate additional revenue to the City,
as discussed in the analysis of advertising research presented earlier.
As stated in the
business case evaluation, the current Ottawa market for outdoor advertising
does not support a strong business case for additional outdoor media at this
time. As a result, it is intended that the City release the upcoming RFPs for
the various advertising initiatives at different times and inform proponents of
the timing of the remaining initiatives. It is also recommended that the ISFP
RFP be released first. Unlike the other RFPs, the ISFP RFP provides both a
revenue source to the City along with assets over a 20-year term, while the
other RFPs simply provide revenue.
Further to this,
through research it has been found that the economies of market packaging in
similar media forms, such as on bus advertising and transit station
advertising, is important in the media sales process. This means that it is
important to package advertising with similar opportunities, for example when
someone rides the bus they will view the ads on the bus, they will also view
ads once they get to the transit station, therefore advertisers could structure
a continued theme for their ad campaigns. With this in mind, it is intended
that the RFPs for transit stations and transit vehicles be combined, since both
venues reach the same audience as the riders exposed to the interior of the bus
also pass through the transit stations.
As approved in the second report, advertising exclusivity in the right of way will be granted to the ISFP proponent; therefore, if Council is considering any other elements for advertising in the future, this new advertising initiative must be offered the first right of refusal to the ISFP proponent.
Continued Consultation
Beyond the consultation processes outlined in previous reports, extensive consultation has taken place with the BIAs to address the ISFP. Two group meetings were held in the fall of 2008, individual meetings were held with each BIA in early January/February 2009, a follow-up presentation was made to the Business Advisory Committee in March and June 2009, and a further BIA meeting was held in late June 2009. During individual meetings, the majority of BIAs indicated their support of this program. All are in agreement that advertising should be limited to transit shelters and information and way-finding kiosks only. BIAs commonly expressed the need to ensure customization of the furniture in order to represent distinctiveness within their community. Within the RFP, specifications will be included requesting that proponents provide details on the level of customization, where possible. It was also understood that there are other ways to mark uniqueness other than through furniture such as bollards, tree guards, lighting, banners, planters, and pavement markings.
Those BIAs with recent street furniture installed as part of an infrastructure renewal project will not have their furniture changed, nor will those receiving furniture installations up to July 2011. Going forward, any new infrastructure renewal projects will use the suite of ISFP furniture. It was also expressed from the BIAs that upon lifecycle renewal for recently installed furniture that a section at a time be replaced rather than an ad hoc approach. In other words, a block width of furniture will be replaced at once; not simply a bench or transit shelter as needed.
During consultation, one BIA indicated a desire to have its own design selected for future furniture. Given the guiding principles of the ISFP, the cost savings and operational challenges with multiple pieces of furniture and their replacement parts, the City will not fund separate designs. If a separate suite of furniture is desired, the cost to purchase, install, and maintain the furniture will become the responsibility of the BIA. If a BIA chooses this route, transit shelters would be exempt and would remain the City’s asset and design.
As indicated in the RFP evaluation process, given their interest in ensuring the design and levels of customization suit their diverse needs, the BIAs have requested, and staff support the inclusion of one of their members on the design jury.
Litter and Recyclable Collection
As per the Direction to Staff arising from the 10 September 2008 Council Meeting, the City will assume the responsibility of emptying and disposing of the contents of on-street litter and recycling receptacles. Staff anticipates offsetting the cost of this program through the ISFP revenues, although the extent of the revenues will not be known until the completion of the RFP process in the latter part of 2009. Should the ISFP revenues not be sufficient to sustain the litter and recycling collection program, a budget pressure would be identified through the 2011 budget process.
Staff envision a Request for Tender being issued by the City to award a contract for the collection and disposal of the contents of litter and recycling receptacles for the ISFP. This would allow the City to accurately report and track gross metrics associated with litter and recyclables, such as tonnes collected and tonnes recycled.
The cost of operating this program is dependent on many factors such as:
· Determination of the most effective collection method. In other words, should collection be done by stream or by receptacle and sorted later? The preferred collection method will also determine the type of collection truck needed. (Note: the use of three-stream trucks is no longer a common practice.)
· Determination of the public’s perception to the preferred collection.
· Setting cost-effective collection routes based on varied collection frequencies.
Staff will work closely with the successful litter and recycling collection proponent to improve and encourage the amount of recycling. As directed from the second ISFP report, staff will examine the processes of other City related litter and recycling collection programs to determine the most efficient way to operate this new service.
ISFP Organizational Unit
Once the RFP process
is finished and a winning proponent is selected, a new organizational unit will
be established to ensure the successful rollout and ongoing operations of the
ISFP. When staff return to Council in Q1 2010, information on the new structure
will be provided.
There
are no legal/risk management impediments to implementing the recommendations in
this report. That being noted, it will nevertheless be important that, as with
other high profile and/or significant procurement processes undertaken by the
City, proponents respect and adhere to the process and requirements set out in
the City’s Request for Proposal. In turn, the City has an obligation to conduct
a fair, open and impartial procurement process. A Fairness Commissioner will
oversee the City’s procurement process and will be able to provide guidance as
required as the process unfolds.
The
ISFP is on target and does not foresee any need for additional funding to
support this project.
Document 1 City of Ottawa Integrated Street Furniture Policy and Design Guidelines
Subject to the approval of this report, staff will issue the ISFP RFP in September 2009 and will report to Council in the first quarter of 2010 on the outcome of the RFP and for final approval of the preferred proponent.