Item - 2025.IE24.10

The Executive Director of Environment, Climate and Forestry recommends that:

1. City Council direct the Executive Director of Environment, Climate and Forestry to begin a phased approach to increase insourcing of tree maintenance services, to target an equal balance between self performed and contracted service delivery.

Environment, Climate and Forestry is committed to the continued implementation of tree maintenance service improvements as recommended by the Auditor General in their report entitled "Getting to the Root of the Issues: A Follow Up to the 2019 Tree Maintenance Services Audit".

Improvements have been focused on strengthening processes and increasing productivity and service quality to drive a more effective and efficient tree maintenance operation. Progress to date includes improved contract language and management practices, increased oversight of Urban Forestry Operations, and timely responses to complaints.

In line with these improvements, Environment, Climate and Forestry continues to focus on the quality of its tree maintenance services through a multi-faceted review of operational practices. As reported to the Infrastructure and Environment Committee in the Tree Maintenance Review Update (2024), an external review was conducted in 2023 by Ernst and Young with a focus on service quality enhancements. Ernst and Young recommended a pilot project to evaluate service quality improvements and cost reductions achievable through insourcing of tree maintenance services.

In response to this recommendation, Environment, Climate and Forestry completed a quality service pilot in 2024 that evaluated the most effective service model to deliver tree pruning and small tree removal services. The results of the pilot and subsequent cost analysis show similar quality, productivity and operating costs between insourced and outsourced tree maintenance crews. A key difference is that insourced crews offer greater operational flexibility than outsourced crews, in that insourced crews can be re-directed and customized quickly and easily to respond to changing priorities in real time.

Based on the results of the pilot, Environment, Climate and Forestry recommends a phased approach to insourcing tree maintenance services, beginning with staff position conversions to optimize crew role assignments, enabling deployment of five additional insourced tree maintenance crews in 2026. The phased approach will be monitored to assess impacts to service levels, with an eventual target of providing equal levels of insourcing and outsourcing, to achieve a better balance between self performed and contracted service delivery. 

Further to the quality service pilot, Environment, Climate and Forestry is currently undertaking a comprehensive third-party review with Beacon Environmental Ltd., examining existing tree maintenance programs, including staff training and qualifications, and aligning with industry standards for tree pruning. This work incorporates engagement sessions with key industry and public stakeholders and a jurisdictional best practices review. The project will conclude in the second quarter of 2026 with a framework of improvements to strengthen reactive and proactive tree maintenance services.

This report recommends a phased approach to increase insourcing of tree maintenance services. The first phase of this approach optimizes existing staff resources to increase the number of insourced tree maintenance crews by five, converting five full time Arborist 2 positions into five full time Leadhand Arborist positions. Future phases of insourcing will likely require the creation of new Arborist positions and capital budget consideration necessary to purchase additional bucket trucks, chippers, tools and equipment.

There is no immediate financial impact on the 2025 Operating and Capital budget as a result of the first phase of increased insourcing of tree maintenance services.

Any financial impact identified as part of future phases of this approach will be treated as a new investment or enhancement to an existing program during future budget process and prioritized against other critical capital and operating City-wide priorities, subject to affordability, outcomes, and achievability.

The chief financial officer and treasurer has reviewed this report and agrees with the information as presented in the financial impact section.