Item - 2024.GG14.19

The General Manager, Transportation Services recommends that:  

1. City Council authorize the General Manager, Transportation Services, to negotiate, enter into and execute an agreement with Hillside Media Communications Limited ("Proposed Revenue Share Agreement"), in substantial accordance with the terms and conditions described in Confidential Attachment 1 to the report (June 17, 2024) from the General Manager, Transportation Services.

2. City Council direct that Confidential Attachment 1 to the report (June 17, 2024) from the General Manager, Transportation Services remain confidential until such time as final Agreement between the City and Hillside Media Communications Limited is fully executed by all parties as it contains a position, plan, procedure, criteria or instruction to be applied to any negotiations to be carried on by or on behalf of the City, and that the final Agreement between the City and Hillside Media Communications Limited be made public subject to applicable law, once it has been fully executed by all parties.

3. City Council direct the revenues from the Agreement to the Public Realm Reserve Fund XR1410 drawn upon annually to provide funding for neighbourhood beautification and other physical public realm improvements. 

This report recommends that the City enter into an agreement with Hillside Media Communications Limited ("Hillside") for a revenue sharing arrangement relating to 14 topiary signs within a portion of the rail corridor defined as the Oakville Subdivision adjacent to, and visible, from the F.G. Gardiner Expressway ("Proposed Revenue Share Agreement").

Currently, Hillside has a 10-year revenue sharing agreement with the City, administered through Transportation Services, under which Hillside pays a specific portion of the revenues to the City; and, also provides the City with the direct benefit of using a specific topiary sign (the "Toronto Sign") along with the maintenance and upkeep thereof. The revenue sharing agreement also obligates Hillside to operate two of the 14 topiary signs with sign content that advertises or promotes charities, approved by the City, at no cost to the City.

The current agreement is set to expire on September 23, 2024. It is the opinion of the General Manager, Transportation Services, that a new revenue sharing agreement, should be agreed to and executed by the City.  It is proposed that the new revenue sharing agreement require a combination of financial payments and provision of services similar to the current Agreement. 

Under the current Agreement, Council approval is required to continue the exemption from Chapter 771, Taxation, Third Party Sign Tax of the City of Toronto Municipal Code.

Under the proposed Revenue Share Agreement, the City will receive annual financial payments to the City starting in 2025 of approximately $21,750.00, which will increase in accordance with the annual increase rate as defined by which is the percentage change in Statistics Canada's Toronto Consumer Price Index (All Items), as calculated by the Chief Financial Officer and Treasurer.

Under the Proposed Revenue Share Agreement, the exemption of these 14 signs from the City's Third Party Sign Tax will result in a reduction to the revenues which would otherwise be collected by the City's Third Party Sign Tax in the amount of approximately $50,050.72 in 2025, which is also subject to similar annual adjustments. However, in addition to the revenue share payment that the City will receive in direct payment, the City will also receive specific services by Hillside, specifically the provision and maintenance of the Toronto Sign.

The Chief Financial Officer and Treasurer has reviewed this report and agrees with the financial impact information.