HomeMy WebLinkAboutCAO-10-017 - Amending Agmt - Ontario Realty Corp
REPORT
REPORT TO:
Council
DATE OF MEETING:
April 12, 2010
SUBMITTED BY:
Rod Regier
PREPARED BY:
John McBride
Rod Regier
WARD(S) INVOLVED:
All
DATE OF REPORT: April 9, 2010
REPORT NO.: CAO-10-017
SUBJECT:
AMENDING AGREEMENT WITH ONTARIO REALTY
CORPORATION PERTAINING TO THE NEW KITCHENER
COURTHOUSE.
RECOMMENDATION:
That the Mayor and Clerk be authorized to execute an amending agreement with the Ontario
Realty Corporation acting as agent on behalf of Her Majesty the Queen in Right of Ontario as
represented by the Minister of Public Infrastructure Renewal, said agreement to be to the
satisfaction of the City Solicitor
.
BACKGROUND:
On September 15, 2008 Council authorized the execution of an agreement with the Ontario
Realty Corporation acting as agent on behalf of Her Majesty the Queen in Right of Ontario as
represented by the Minister of Public Infrastructure Renewal for the provision of parking related
to the new Kitchener Courthouse.
The Agreement provided the Province with 185 spaces in the Charles & Benton Garage based
on an occupancy date of Dec 1, 2009. The Province was anticipating obtaining a building permit
for the Courthouse by Dec 1, 2009. Provision was made for an initial payment of $2,000,000
upon signing the agreement and said payment was received. The remainder of the cash in lieu
to address planning requirements for parking in the amount of $4,475,000 was due upon
issuance of the building permit for the courthouse. The Agreement provided for the provision of
an interest payment from the Province to the City, based on the short term investment rate as
amended from time to time, for carrying the outstanding amount from Dec 1, 2009 until the
issuance of the building permit, should the building permit not be issued by December 1, 2009.
REPORT:
The Province is now requesting an amendment to agreement to adjust the timing of the
payments. The Province proposed to pay the City $2,000,000 by Apr 30, 2010 in lieu of any
interest payment and the balance of $2,475,000 to be paid upon substantial completion of the
garage (anticipated being Sept 30, 2010). The short term investment rates have significantly
dropped over the last number of months and therefore earlier receipt of a large portion of the
funds is more beneficial for the City.
FINANCIAL IMPLICATIONS:
Earlier receipt of $2,000,000 gives the City funds sooner than under the original agreement and
it reduces the City’s carrying costs. Finance staff has reviewed this request and support the
approach being proposed.
CONCLUSION:
Staff is in full support of this approach and recommends that the Agreement be so amended.
ACKNOWLEDGED BY:
Lesley MacDonald, Director of Legal Services and City Solicitor