Item - 2025.GG22.12

The General Government Committee recommends that:  

1. City Council grant authority to the Chief Technology Officer, in accordance with Sections 195-6.6 and 195-8.5 of the Toronto Municipal Chapter 195 (Procurement), to amend purchase order number 47015457, commencing from the date of award for a seven (7) year period, with one 2-year extension and one subsequent 1-year extension, for up to a total potential 10-year term for the total amount set out in Confidential Attachment 1 to the report (June 3, 2025) from the Chief Technology Officer and the Chief Procurement Officer, subject to terms and conditions acceptable to the Chief Technology Officer and generally in accordance with the terms of the existing agreement.

2. City Council adopt the confidential instructions to staff in Confidential Attachment 1 to the report (June 3, 2025) from the Chief Technology Officer and the Chief Procurement Officer.

3. City Council direct that Confidential Attachment 1 to the report (June 3, 2025) from the Chief Technology Officer and the Chief Procurement Officer, remain confidential at this time as it pertains to criteria to be applied to negotiations carried on or to be carried on by or on behalf of the City of Toronto and be made public at the discretion of the Chief Procurement Officer following the execution of the Contract authorized by recommendation 1. 

This report requests City Council authority to amend purchase order number 4701547 (the "Contract") with Bell Canada, a Canadian supplier. The amendment will add five (5) years to the contract duration and update the total ten year cost. The City is intentionally pursuing a contract amendment five years prior to expiry to strategically leverage favorable terms and rates, accelerate and complete planned technology modernization, and reduce ongoing maintenance costs through the use of industry-standard solutions. The City is unable to achieve these benefits under the existing Contract.

The Contract supports the operation of the City's telecommunication and networking systems, including network cabling installation and completion of state of good repair projects, and advances the City's Integrated Telecommunications Infrastructure modernization strategy.

The City's Integrated Telecommunications Infrastructure strategy is a roadmap to modernizing the City's communication environment, which provides the necessary infrastructure required for basic and modern communication within the organization, and to the public, to provide effective municipal services. This includes phone lines (digital and traditional landlines), City contact centre platforms and support and internet connections at City buildings.

The City competitively procured the Contract that powers this communication environment with Bell Canada in 2010 for an initial five (5) year term; it then extended the Contract in 2015 and 2020, under City Council authority. In 2020, the amendment included an additional five (5) year term plus five (5) 1-year option terms to 2030, with a requirement for the City to re-negotiate rates for these option terms annually.

To continue the implementation of the Integrated Telecommunications Infrastructure strategy, City staff are requesting City Council authority to award an amended Contract with the supplier for ten years (to 2035) and update the total spend award over the term. This approach provides the best value to the City as it removes the risk of annual rate increases by locking in favorable rates for the next decade and enables the City to accelerate and complete in-flight and planned modernization initiatives with the existing supplier. Should the extensions no longer be required, the City retains the authority to forgo executing them without rate penalties.

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