Item - 2021.EX25.7

The Executive Committee recommends that:

1. City Council approve the renewal of the following:

a. the line of credit guarantee issued by the City on behalf of the Toronto Symphony Orchestra to its lender in the amount of $5,000,000 (inclusive of all interest payable by the Toronto Symphony Orchestra) for a three-year period commencing on November 1, 2021 and ending October 31, 2024; and

b. the capital loan issued by the City on behalf of the Lakeshore Arena Corporation in the amount of $4,047,660 (interest payments only) for a further one-year period commencing on November 1, 2021 and ending October 31, 2022.

This report provides an annual update on the City's loan and loan guarantee portfolios for the year ending in 2020.

The City currently guarantees three operating lines of credit and eight capital loan guarantees under Council approved policies for line of credit and loan guarantees for cultural and community-based organizations.  In addition to the guarantees, the City currently has outstanding a total of seven direct loans:  six to City agencies and corporations, plus one to an external organization.  All loans and guarantees are in good standing as at the 2020 year end.

The effects of COVID-19 and related closure of many of the not-for-profit and City agency venues associated with these loans and guarantees occurred in  the 2020 calendar year and continue to the date of this report.  The City has monitored the status of these loans and guarantees.  As at December 31, 2020, some of the loans have been permitted to defer required payments by lenders due to lack of sufficient cash flow due to COVID related business closures.  Allowable deferred payments are not considered a default on the loan. 

Currently at this point in 2021, these loans remain in good standing. The entities subject to this report have been staying current for the most part by adjusting operations to contain costs and through the receipt of financial assistance measures such as federal and provincial support programs and/or lender authorized payment deferrals, or by accessing associated existing debt service reserves and a line of credit to fund loan payments.

The City will continue to monitor and bring forward any necessary actions for Council consideration that may arise from any future loan servicing deficiencies.  At this time COVID closures still exist, however no immediate actions surrounding any changes in loan terms are required.  This does not however preclude that future actions may become necessary to ensure the long term viability of loan servicing under these loans and guarantees should any conditions change such as the provision of financial supports and/or potential re-opening revenue streams.  Such reporting will occur as necessary.

This report recommends extending a line of credit guarantee with a not-for profit performing arts group for an additional three year term as well as extending the loan term for a City loan to a City services corporation for an additional one year term.