Item - 2025.GG21.12

The General Government Committee recommends that:  

1. City Council grant authority to the Executive Director, Environment, Climate and Forestry to approve the invoices provided pursuant to the Producer Service Agreement between the City of Toronto and Circular Materials Ontario, effective June 30, 2023 in the amounts indicated in the Confidential Attachment 1 to the report (April 28, 2025) from the Executive Director, Environment, Climate and Forestry, and the Chief Procurement Officer, as well as any future invoices under the Producer Services Agreement, to a total spend of $1,000,000.

2. City Council direct that Confidential Attachment 1 to the report (April 28, 2025) from the Executive Director, Environment, Climate and Forestry, and the Chief Procurement Officer, remain confidential in its entirety, as it contains financial information supplied in confidence to the City of Toronto, which, if disclosed, could reasonably be expected to prejudice significantly the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization.

The purpose of this report is to request City Council authority to enter into a non-competitive contract with Circular Materials Ontario, a Producer Responsibility Organization, for services provided to manage the City of Toronto's producer obligations as set out under Ontario Regulation 391/21: Blue Box, for 2025 fee payments with an option to renew the contract for an additional one-year term. The non-competitive contract will be for an initial one (1) year term with an option to renew for one (1) additional year. This non-competitive will ensure compliance with the Provincial Regulation for payment of fees.

A Producer Responsibility Organization is an organization registered with the Resource Productivity and Recovery Authority to provide collection, material recovery, and administration services to producers of designated wastes as an alternative to establishing a management system of their own. For producers of Blue Box materials, services provided by a Producer Responsibility Organizations enable them to meet their regulatory obligations to manage all the designated packaging, printed paper and packaging-like products that they supply into the Ontario marketplace.

The City of Toronto entered into a Producer Services Agreement with Circular Materials Ontario in 2023 to ensure its compliance with Provincial regulation. The decision to pursue a non-competitive procurement was due in part to the limited timeline for the Province's transition to Extended Producer Responsibility and the City's associated timeline constraints to execute on transition requirements. At the same time the City determined that it was advantageous to enter into an agreement with Circular Materials Ontario as they are the administrator of the Common Collection System for the Blue Box Program. Furthermore, Circular Materials’ dominant position in the Ontario marketplace, along with the existing contractual arrangement with the City as Circular Materials’ recycling service provider during the transition period from July 1, 2023 to December 31, 2025, made Circular Materials the preferred Producer Responsibility Organization for managing the City’s obligations.

City Council approval is required in accordance with Toronto Municipal Code Chapter 195 - Procurement, where the current request exceeds the Chief Procurement Officer's authority of the cumulative five year commitment under Article 7, Section 195-7.3 (D) of the Procurement By-Law or exceeds the threshold of $500,000 net of Harmonized Sales Tax allowed under staff authority as per Toronto Municipal Code Chapter 71, Financial Control, Section 71-11A.