Item - 2020.IE11.7

The Infrastructure and Environment Committee recommends that:

1.  City Council authorize the General Manager, Toronto Water, to finalize negotiations with Veolia Water Canada, Inc. ("Veolia") and enter into and execute a ten (10) year renewal of the Operation, Maintenance and Pellet Marketing Services Agreement between Veolia and the City dated September 24, 2007, as amended by the Amendment Agreement dated March 1, 2010 ("OM&M Agreement"), on amended terms and conditions substantially consistent with the principles outlined in Attachment 1 to the report (December 17, 2019) from the General Manager, Toronto Water, and otherwise on terms and conditions satisfactory to the General Manager, Toronto Water, and in a form satisfactory to the City Solicitor ("Renewal Term Agreement").

This report seeks City Council authority for the General Manager, Toronto Water, to finalize negotiations with Veolia Water Canada, Inc. ("Veolia") and enter into and execute a ten (10) year renewal of the Operation, Maintenance and Pellet Marketing Services Agreement between Veolia and the City dated September 24, 2007, as subsequently amended in 2010 ("OM&M Agreement"), on amended terms and conditions substantially consistent with the principles outlined in Attachment 1 to this report.

The OM&M governs the relationship between the City and Veolia pertaining to the operation and maintenance by Veolia of the Ashbridges Bay Treatment Plant ("ABTP") Pelletizer Facility ("Pelletizer Facility") which was commissioned and put into full-time service in 2009. The services provided by Veolia under the OM&M also include the transportation and marketing of the biosolids pellets (generated by the Pelletizer Facility) to the agricultural sector in south-western Ontario. Unless renewed, the OM&M will expire in February 2020.

Since inception of the OM&M, production volumes and reliability have consistently improved. Also, since 2016, the services provided by Veolia under the OM&M has helped the City to achieve 100 percent beneficial use of the ABTP biosolids. The recommended ten (10) year renewal, which is permitted in the OM&M, subject to the approval of City Council, will ensure continuity of service to 2030. In addition to addressing in principle the proposed renewal and related contract amendments, Attachment 1 includes certain proposed amendments to the OM&M in recognition of the service performance achieved by Veolia to date and the City's need to plan for an eventual replacement facility over the course of this renewal period.