Item - 2024.EP13.3

The Board of Governors of Exhibition Place:

1.  Approved the Proposed 2025 Above the Line Capital Works State-of-Good-Repair Budget (Sections A and B of Appendix A) of $22.131 million with $22.016 million funded by debt and $0.114 million funded by recoveries from CNEA, as part of the ten year (2025-2034) proposed program submission to the City of Toronto.

2.  Approved the Proposed 2025 FIFA 2026 non-Exhibition Place managed project in the amount of $27.478 million funded by City Capital Financing Reserves and Federal contribution funds.

3.  Directed the Chief Executive Officer to submit the 2025 Budget and any changes or directions by the Board to the City Financial Planning Division as part of the 2025 Budget Process.

Toronto, being North America’s 4th largest City is home to Exhibition Place. The site currently hosts 1,761 events annually with approximately 5.5 million visitors per year for exhibitions, conventions, events, and entertainment, and we are moving towards becoming a 365-day destination for an impressive range of activities. It is important to note that Exhibition Place is pedestrian friendly, and we are visited by our neighbours to the north, from across the country and around the world.

Exhibition Place vision is to become Canada’s premier destination for conventions, exhibitions, events, and entertainment. We are a unique site in North America, and our goal is to transform Exhibition Place into an intimate space that facilitates unimpeded movement of people.

On June 18, 2024, the City’s Chief Financial Officer and Treasurer provided supplementary instructions for all City Divisions and Agencies with the preparation of the 2024 Capital Works Budget as Part of the Ten-Year Submission.

Exhibition Place Managed Projects

Supporting the City objective of minimizing debt funding, Exhibition Place staff have worked towards minimizing debt funding for Exhibition Place new projects, also taking into consideration inflationary pressures, and supporting our vision. The change from 2024 to 2025 10-year Capital Plan excluding carry-forward is a year-over-year change of $11.636 million over the 10 years.

Third Party Projects

In early 2023, the City entered into a management agreement with Maple Leaf Sports and Entertainment (MLSE) for activities in support of Toronto’s hosting of FIFA World Cup 2026. This includes, but not limited to major upgrades to the City-owned soccer stadium at BMO Field. Given that this City project is on the Exhibition Place grounds, it was agreed by MLSE and the City that the financial process / cash flow would flow through Exhibition Place’s 10-Year Capital Plan. This will be a significant project as the annual cash flow funding requirement for the capital infrastructure needs to bring the stadium to FIFA operational standards as reported over the period 2023-2026 will be approximately $90.047 million in project cost. From the previous 10-year capital budget submission the total project cost has increased by $17.347 million. The City is working with the Federal government regarding their financial commitments to share costs.

Overview

Overall, our 10-year Capital Plan for Exhibition Place is $258.084 million with $190.926 million for Exhibition Place managed projects and the remaining $67.158 million for 3rd party managed projects relating to FIFA World Cup 2026.

Throughout the budget process Exhibition Place staff worked closely with City FPD in developing the budget. The City practice for 2025 allocation of funds is still based on the Board capacity to spend but is linked more closely to the City's ability to fund the projects with debt.

Annually, staff review the 10-year capital plan; this annual review procedure allows Exhibition Place to adjust its current State-of-Good-Repair (SOGR) program each subsequent year based on changing and operational needs, building/audit assessments, legislative changes, mandates, and priorities.

Exhibition Place staff have submitted the 2025 Capital Works Budget to City FPD to meet the City Manager September 10, 2024, deadline; however, due to the budget submission schedule, City FPD understands that the budget is subject to Board approval and that the Board therefore reserves the right to make changes to the Capital Works Budget content. Exhibition Place staff will notify the City of any changes or directions made by the Board.

In accordance with City guidelines for capacity to spend, the City's ability to fund, building assessments and SOGR priority, a total of $49.609 million net program is recommended for 2025 Capital budget. This includes:

1.  New Projects for a total amount of $19.956 million cash flow in 2025 (Section 'B' in Appendix A) as follows:

a.  $0.231 million for Food Building projects ($0.200 million for replacing overhead doors and $0.031 million for fire alarm system upgrade); 50 percent of which are to be funded by CNEA, as per the Board's Master Agreement sharing provisions with CNEA.

b.  $19.725 million for various upgrades within existing buildings, parking lots and roads grounds wide, all funded by debt.

2.  Previously Approved cash flow of $2.175 million in 2025 (Partial Section 'A' in the Appendix A) as follows:

a.  $0.550 million previously approved 2025 cash flow for Emergency Generators Upgrades at various buildings (additional cash flow request for 2026 is $2.000 million).

b.  $0.625 million previously approved 2025 cash flow for substation consolidation and upgrades.

c.  $1.000 million adjusted previously approved 2025 cash flow for replacement of high voltage priority feeders (cash flow for 2026 is $2.000 million and cash flow adjustment request for 2027 is $2.000 million).

In summary, the total budget cash flow for Above the Line Capital Program 2025 (Sections A and B in Appendix A) including New Projects, Previously Approved and Carry Forward is $22.131 million.

Even with the additional funding being recommended, the Net Accumulated SOGR Backlog at the end of 2025 for Exhibition Place stands at $77.404 million.

3.  The 2025 capital cash flow for Non-Exhibition Place managed projects (Section C) include FIFA 2026 capital project of $27.478 million.

Capital Needs Constraints

In addition to the $258.084 million required for the 10-year above the line capital works program, there exists $129.900 million of capital projects that are below the line. The term 'below the line' refers to projects not approved but that have capital needs or more specifically projects that their capital needs cannot be accommodated within the City capital plan even though the Board have the capacity to deliver. The projects under these constraints for Exhibition Place in the 10-year plan consist of $54.900 million for the Festival Plaza Development and $75.000 million for the Industry Building renovation.