Item - 2025.GG23.18

The General Government Committee recommend that:

1. City Council authorize the General Manager, Toronto Water, to negotiate and execute a Non-Competitive Procurement contract with Fer-Pal Construction Ltd., for Urgent Watermain Cured-in-Place Pipe Lining at various locations in Ward 6, in the amount of $6,000,000 net of all applicable taxes ($6,105,600 net of Harmonized Sales Tax recoveries) from the date of award to May 31, 2026, subject to terms and conditions satisfactory to the General Manager, Toronto Water, and in a form acceptable to the City Solicitor.

The purpose of this report is to request City Council authority to enter into a non-competitive contract with Fer-Pal Construction Ltd., for Urgent Watermain Cured-in-Place Pipe Lining at various locations in Ward 6.

The commissioning of the Downsview transmission main earlier this year has increased water pressure in the area, causing breaks in watermains with deteriorated condition. This indicates that portions of the existing infrastructure cannot handle the higher pressure. If these watermain condition issues are not addressed promptly, it could significantly impact both public infrastructure and customer service.

To prevent additional watermain and service breaks, water pressure in the affected areas has been temporarily reduced until the structural integrity of the distribution system can be improved through Cured-in-Place Pipe lining. Pressure levels must be restored to support the future growth of Downsview. Therefore, the Cured-in-Place Pipe structural lining of watermains in Ward 6, originally planned for 2026, must be advanced to 2025.  The total value of the work identified for advancement to the 2025 is estimated at $11.8 million (net of Harmonized Sales Tax recoveries). Fer-Pal Construction Ltd. is currently completing similar work in Wards 3, 4, and 5), and unspent funds of $5.8 million under that contract will be used to initiate the work in Ward 6. To complete the full scope of work in 2025, Toronto Water is requesting authority to award a non-competitive contract to Fer-Pal for the remaining balance of $6,000,000, net of all taxes and charges ($6,105,600 net of Harmonized Sales Tax recoveries) from the date of award to May 31, 2026.

Due to seasonal constraints, this construction work must be completed by November 2025, leaving Toronto Water with insufficient time to conduct a competitive procurement process and complete the construction work. While the watermain lining will be completed in 2025, this contract will also support the associated road and boulevard restoration work, which is scheduled for completion in spring 2026.

Non-competitive procurements may be undertaken where both the proposed procurement and supplier can be justified in good faith based on an exception set out in Toronto Municipal Code Chapter 195, Procurement. These procurements will be proceeding under the exception code related to time constraints where due to the urgency for the delivery of a good and service, time does not permit the competitive solicitation processes and the City has determined in good faith that both the proposed procurement and the selected supplier, along with the terms and conditions of the contract are beneficial to the City (Toronto Municipal Code, Chapter 195, Procurement, Section 7.1B.).

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.