Item - 2015.EX5.6

The Executive Committee recommends that:

1.  City Council direct the City Manager, in consultation with the Chief Executive Officer of the Toronto Transit Commission and the Deputy City Manager and Chief Financial Officer to report back to City Council by the first quarter of 2016 with their recommendation on whether to proceed with a Design-Bid-Build or Design-Build-Finance option for project procurement and that such report also include recommendations with respect to project management, delivery and governance.

2.  City Council authorize the Deputy City Manager and Chief Financial Officer to retain the services of Infrastructure Ontario, and such other advisors that are required to complete the Procurement Options Analysis, at a total cost not to exceed $500,000.

3.  City Council request that the Board of the Toronto Transit Commission continue to structure any contracts for design or other preparatory work for the Scarborough Subway Extension so as to preserve the ability to proceed with whichever procurement and delivery model is recommended to Council following completion of the Procurement Options Analysis.

This report responds to a direction from Council (EX4.17) to examine potential options for the delivery of the Scarborough Subway Extension project (the "SSE").

In particular, the report focuses on an assessment of potential project procurement options. This high-level assessment indicates that the most appropriate procurement approach will be either a traditional Design-Bid-Build ("DBB") approach or a Design-Build-Finance ("DBF") form of Alternative Finance and Procurement ("AFP"). The participation of a private partner in the operations of the project has been ruled out as it is impractical in an extension of an existing subway line.

The existing Collective Bargaining Agreement with TTC unions also explicitly precludes the contracting out of those maintenance activities that are normally undertaken by TTC employees. However, the consideration of some scenarios for the lifecycle maintenance by the private partner of major structural elements of the project may be incorporated within a P3 (Public Private Partnership) screen required as a condition of the federal funding commitment being provided through the New Build Canada Fund. This report recommends that Infrastructure Ontario be retained to advise on the preparation of a POA.

‎In addition to addressing procurement, the report sets out the process that will lead to decisions with respect to the appropriate form of project management and delivery for each stage of the SSE project.

Finally, this report also requests that the Board of the Toronto Transit Commission continue to structure any new contracts for design or other preparatory work for the project so as to preserve the ability to proceed with whichever procurement mode is recommended as a result of the POA. This will allow the project to proceed with no delays during the time the POA is being carried out.