Item - 2020.GL15.11

The General Government and Licensing Committee:

1. In accordance with Section 71-11.1C of the City of Toronto Municipal Code Chapter 71 (Financial Control By-Law), authorized the City Solicitor to amend the retainer with Osler, Hoskin & Harcourt LLP, by increasing the value from $900,000 to $1,200,000, net of all applicable taxes and charges and increase the value on Purchaser Purchase Order 6035311 by the same amount.

As part of the City of Toronto's ongoing efforts to merge the City-sponsored legacy pension plans into the Ontario Municipal Employees Retirement System, the law firm of Osler, Hoskin & Harcourt LLP was retained in 2012, with an expected completion of services date of April 1, 2017, in the amount of $150,000.  As the required Regulations to facilitate these mergers were not released by the Provincial government until November 2015, Osler's services were further required and Council authority was obtained in May 2017, extending that date to April 1, 2020 and increasing the retainer amount to $450,000.   

At the July 3, 2018 Government Management committee meeting, a further amendment to increase the Osler's retainer amount from $450,000 to $900,000 was approved, with an anticipated completion date of April 1, 2020.

As of January 2020, the City had successfully completed the merged with the Ontario Municipal Employees Retirement System of four City-sponsored legacy pension plans, and had commenced the next phase of officially winding-up/terminating the pension plans and distributing the remaining assets (surplus), as required by Provincial Regulation.  Each step in the current phase has required reports, applications, and other documentation to be filed with and approved by the Financial Services Regulatory Authority of Ontario. Osler's has continued to be a valued partner for the City in providing guidance and direction to this complex task involving the plan actuary, and member counsel as well.

However, due to some unexpected complexities including the COVID-19 emergency measures, which affected the original timelines, the Retainer Agreement period was extended from April 1, 2020 to December 31, 2020 to enable completion of the work, by letter dated May 12, 2020, from the City Solicitor.  At that time, no change in retainer amount was anticipated.

By July 15, 2020, it became apparent that the amount authorized by Council in 2018 was insufficient to complete the merger finalization including wind-up/termination and distribution of surplus, for all four City-sponsored legacy pension plans and as well, that despite everyone's best efforts, additional time beyond December 31, 2020 was required for the final conclusion of these steps. 

The continued guidance and direction of Osler's to complete this complex matter would be of significant assistance to City staff as this multi-year process is brought to a conclusion. It would not be prudent to go out to market to retain a new firm, which would not have the history and familiarity that Osler's does with this ongoing matter.  This would create delay and additional cost to the City.

Osler's has estimated that an additional $300,000 is required to bring this matter fully to a close by March 31, 2021.