Board Meeting - February 2, 2005

H. Moscoe (Chair), J. Mihevc (Vice-Chair), B. Ashton, B. Balkissoon, A. Giambrone, Mayor D. Miller, P. Li Preti and D. Shiner (Commissioners), R. Ducharme (Chief General Manager), V. Rodo (General Manager – Executive & General Secretary), G. Webster (General Manager – Operations), J. Sepulis (General Manager - Engineering & Construction), L. Hilborn (Deputy General Manager – Corporate), P. Buttigieg (Chief Accountant – Financial Services), D. Presley (Chief Accountant – Capital Accounting), M. Anders (Marketing Research Director), W. Buffett (Assistant General Secretary) and F. Stanois (Co-ordinator - Secretariat Services) were present.

H. Moscoe was in the Chair.

Councillor D. Soknacki, Councillor S. Carroll and Councillor S. Watson were also present.

J. Di Lallo and R. Graham, Budget Services, City of Toronto were present.

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1. Review of TTC Budget Committee Minutes – January 17, 2005

On Motion Of Vice-Chair Mihevc, The Commission Approved The Minutes From The TTC Budget Committee Meeting Held On Monday, January 17, 2005.

2. Motion Re: Cancellation of Contract Y45-1 Key Station Accessibility – York Mills Station

SEE ITEM NO. 3 FOR MINUTE.

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3. Review of TTC Budgets

Councillor Soknacki, Chair, City of Toronto Budget Advisory Committee provided an overview of the Budget Advisory Committee’s financial objectives and decisions in relation to the TTC’s Capital and Operating Budgets.  Specifically, the Budget Chair noted that he was prepared to recommend the following to the City Budget Committee to reduce the requested cuts to the TTC Capital Budget from $47 million to $27 million:

1) Increasing City Debt by $10 million; and

2) Reducing other Non-TTC City Capital Programs by $10 million.

Mayor Miller provided a verbal update concerning the recent announcement by the Federal Government to provide municipalities across Canada with a portion of Federal Gas Tax revenues to fund sustainable and environmental infrastructure, including public transit,    noting that it seems reasonable to budget on receiving an additional $10 million in Federal Gas Tax contributions to the City in 2005 (increasing the budget allotment from $33 million to $43 million).

V. Rodo, General Manager – Executive & General Secretary summarized that between the extra Federal Gas Tax contribution and the $20 million recommended by the Budget Chair, the TTC still needs to come up with $17 million to balance the TTC Capital Budget in 2005.  He then gave an overhead slide presentation responding to the Operating and Capital Budget cuts (Attachment A) requested by the City Budget Advisory Committee.

Vice-Chair Mihevc Moved That The Commission Adjust The Operating And Capital Budgets, As Listed Below; And Further That These Adjustments Be Presented To The City Budget Advisory Committee At Its Meeting On Friday, February 4, 2005:

2005 TTC Operating Budget

TTC Operating Subsidy Request – BAC Approved Jan. 27/05 / $228.6M
      
Ridership Increase - 424M TO 426M / (3.2)  

Gapping Increase On Administrative Positions / (0.15)

Property Tax Reduction / (1.2)

Hiring Deferrals / (0.15)

Total Reductions To Be Directed To TTC Capital Budget / (4.7) / (4.7)

TTC Revised Operating Subsidy Request / $223.9M

2005 TTC Capital Budget

• Project 505 Russell Carhouse Platform Modifications / $ 0.8

• Project 513 Overhead Speed Doors – Arrow/Eglinton / 1.2

Duncan

• Project 571 On-Grade Paving – Kennedy, Hillcrest / 2.0

• Project 639 Structural Paving – Design / 0.5

• Project 891 Office Space Management – Inglis 4th Floor / 1.0

• Project 1083 Purchase Auto Non-Revenue Vehicle / 0.3

• Project 1139 Vehicle Engineering – Removal 3 Air  / 0.1

Compressors

• Project 605 Transit Shelters And Loops / 1.5

• Project 629 Wilson Traffic Separation  / 1.4

• Project 1125 Fire Ventilation Upgrade –  Deceleration / 1.4

Second Exits

Total Capital Deferrals / $10.2M

Vice-Chair Mihevc Also Moved That Contract Y45-1 Key Station Accessiblity – York MillsStation Be Deferred Due To A Lack Of Funding.

The overall impact of these items is as follows:

BAC Capital Reduction Target / $95.0M

- Cash Flow Reductions / (45.0)

- York Mills Elevator Deferral / (3.0)

- Increased City Debt / (10.0)

- Reduction in Non-TTC City Programs / (10.0)

- Increased Federal Gas Tax / (10.0)

- TTC Operating Budget Cuts Directed / (4.7)    

- To TTC Capital Budget

- Additional TTC Capital Deferrals / (10.2)

- Sub Total / $(92.9)

- Balance / $ 2.1M

Commissioner Balkissoon Moved That City Finance Staff Be Requested To Reconsider The Budget Shortfall And Look At Ways Of Taking TTC Fixed And Vehicle Assets And Debenturing Them Over A Different Timeframe So That The Required Financing Is More In Line With The Actual Lifecycle Of The Assets.

Due To Time Constraints, Commissioner Balkissoon Moved The Following:

1. That The Meeting Be Adjourned;

2. That The Meeting Reconvene At 12:30 p.m. On Thursday, February 3, 2005 For Further Consideration Of The Motions Put Forward; And

3. That The City Of Toronto’s Chief Financial Officer And Treasurer Be Invited To Attend At That Time.

The Motion By Commissioner Balkissoon Carried.

The meeting adjourned at 2:05 p.m.

The meeting reconvened in Committee Room 1, Toronto City Hall, 100 Queen Street West, Toronto, Ontario on Thursday, February 3, 2005 at 12:40 p.m.

J. Mihevc (Vice-Chair), B. Ashton, B. Balkissoon, D. Shiner, A. Giambrone and S. Bussin (Commissioners), V. Rodo (General Manager – Executive  & General Secretary), G. Webster (General Manager – Operations), J. Sepulis (General Manager - Engineering & Construction), L. Hilborn (Deputy General Manager – Corporate), B. Leck (General Counsel), M. Roche (Chief Financial Officer), M. Anders (Marketing Research Director), W. Buffett (Assistant General Secretary) and F. Stanois (Co-ordinator - Secretariat Services) were present.

Vice-Chair Mihevc was in the Chair.

Councillor D. Soknacki, Councillor S. Carroll and Councillor S. Watson, City of Toronto were also present.

J. Pennachetti, Chief Financial Officer & Treasurer, City of Toronto was present.

J. Di Lallo and R. Graham, Budget Services, City of Toronto were present.

3. Review of TTC Budgets (Cont’d)

Vice-Chair Mihevc advised that this meeting was a continuance from yesterday.

V. Rodo, General Manager – Executive & General Secretary gave an overhead slide presentation (Attachment B) outlining the previous day’s deliberations.

A question and answer period then ensued between the Commission and staff from the City and TTC.

At 1:40 p.m., there being no quorum, the meeting adjourned.  The following members were recorded as being in attendance:

Vice-Chair Mihevc

Commissioner Giambrone

Commissioner Bussin

Commissioner Ashton   

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