Council Chambers – 2:00 pm Chair: Councillor McLean - Pickering 17, 2019.… · Community...

Executive Committee Meeting Agenda

Monday, June 17, 2019 Council Chambers – 2:00 pm

Chair: Councillor McLean

For information related to accessibility requirements please contact: Linda Roberts 905.420.4660 Extension 2928 [email protected]

. Disclosure of Interest

2. Delegations

2.1 Jason Hunt, Director of Legal Services, Corporate Services, Durham Region, Audrey Andrews, Manager of Strategic Partnerships and Initiatives, Social Services Department, Region of Durham, and Christina Henderin, Associate Solicitor, Legal and By-Law Services, Town of Whitby Re: Introduction to the Access to Justice Hub

2.2 Stan Karwowski, Director, Finance & Treasurer and Mike Jones, Supervisor, Taxation Re: Farm Taxation

3. Matters for Consideration

3.1 Director, Community Services, Report CS 06-19 1Beverage Supply Agreement Renewal – Coca-Cola Canada Bottling Limited

Recommendation:

1. That the Mayor and City Clerk be authorized to execute aBeverage Supply Agreement with Coca-Cola Canada BottlingLimited as set out in Attachment 1 to this report, subject tominor revisions as may be required by the Director, CommunityServices and the Director, Corporate Services & City Solicitor;and,

2. That the appropriate City officials be authorized to take thenecessary actions as indicated in this report.

3.2 Director, Community Services, Report CS 08-19 10Quotation No. Q-7-2019 Supply and Delivery of Road Grader with Attachments

Recommendation:

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1. That Quotation No. Q-7-2019 submitted by Toromont CAT in theamount of $361,823.10 (HST excluded) be accepted;

2. That the total gross project cost of $410,555.00 (HST included),including the amount of the quotation, optional equipment(Automated Grade Control system) and other associated costs,and the total net project cost of $369,717.00 (net of HST rebate)be approved;

3. That the Director, Finance & Treasurer be authorized to financethe total net project cost in the amount of $369,717.00 asfollows:

a) the sum of $350,000.00, as provided for in the 2019 CapitalBudget, be increased to $369,000.00, to be financed by theissue of debentures by the Regional Municipality of Durhamover a period not to exceed five years;

b) the balance sum of $717.00 to be funded from propertytaxes;

c) the annual repayment charges in the amount ofapproximately $81,150.00 be included in the annual CurrentBudget for the City of Pickering commencing 2019, or suchsubsequent year in which the debentures are issued, andcontinuing thereafter until the debenture financing is repaid,and any financing cost to be paid out of the Current Budget;

d) the Treasurer be authorized to make any changes,adjustments, and revisions to amounts, terms, conditions, ortake any actions necessary in order to effect the foregoing;

4. That the draft By-law attached to this report be enacted; and,

5. That the appropriate officials of the City of Pickering beauthorized to take the necessary actions as indicated in thisreport.

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3.3 Director, Community Services, Report CS 24-19 18 Gingerbread Co-operative Nursery School (Pickering) Inc. License Agreement Renewal

Recommendation:

1. That the Mayor and City Clerk be authorized to execute aLicense Renewal Agreement with Gingerbread Co-operativeNursery School (Pickering) Inc. as set out in Attachment 1 tothis report, subject to minor revisions as may be required by theDirector, Community Services and the Director, CorporateServices & City Solicitor; and,

2. That the appropriate City officials be authorized to take thenecessary actions as indicated in this report.

3.4 Director, Community Services, Report CS 30-19 26 Community Festivals and Events – Approval of Christmas Market in Esplanade Park

Recommendation:

1. That Council authorize staff to issue a park permit for the use ofEsplanade Park by Graymatter Marketing Solutions from Friday,November 29 to Saturday, November 30, 2019 (inclusive) for aChristmas Market, on terms and conditions satisfactory toDirector, Community Services and Chief Administrative Officer;and,


3.5 Director, Engineering Services, Report ENG 07-19 29 Amendment to Traffic and Parking By-law 6604/05 Inclusion of New Roads and Traffic Controls, Kindwin Subdivision

Recommendation:

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1. That the attached draft by-law be enacted to amend Schedule“2”, Schedule “5”, Schedule “6”, Schedule “7”, Schedule “9” andSchedule “10” to By-law 6604/05 to provide for the regulation ofstopping and parking on highways or parts of highways underthe jurisdiction of the Corporation of the City of Pickering,specifically to provide for the inclusion of new roads and trafficcontrols into the Traffic and Parking By-law; and,


3.6 Director, Engineering Services, Report ENG 08-19 40 Amendments to Traffic and Parking By-law 6604/05 – Various Locations

Recommendation:

1. That the attached draft by-law be enacted to amend Schedule“1”, Schedule “2”, Schedule “6”, Schedule “7”, and Schedule“14”, to By-law 6604/05 to provide for the regulation of stoppingand parking on highways or parts of highways under thejurisdiction of the Corporation of the City of Pickering,specifically to provide for stopping restrictions on SheppardAvenue, parking restrictions on Bainbridge Drive, an all-waystop at the intersection of Pine Grove Avenue and WoodviewAvenue, and Community Safety Zones on Toynevale Road andon Rosebank Road; and,


3.7 Director, City Development & CBO, Report PLN 15-19 55 Sustainable Pickering Year-in-Review

Recommendation:

That Report PLN 15-19 be received for information.

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3.8 Director, Finance & Treasurer, Report FIN 08-19 69 2018 Year End

Recommendation:

1. That the Report to the Executive Committee on the 2018 auditas submitted by Deloitte LLP (Deloitte) be received forinformation;

2. That the 2018 draft Audited Consolidated Financial Statementsfor the City of Pickering be approved; and,

3. That Deloitte LLP be reappointed to provide external auditingservices to the City of Pickering for a 3 year term.

3.9 Director, Finance & Treasurer, Report FIN 09-19 147 Investment Portfolio Activity for the Year Ended December 31, 2018 Ontario Regulation 438/97 under the Municipal Act, 2001

Recommendation:

It is recommended that report FIN 09-19 of the Director, Finance & Treasurer, regarding Investment Portfolio Activity for the Year Ended December 31, 2018, be received for information.

3.10 Director, Finance & Treasurer, Report FIN 11-19 165 Annual Indexing – Development Charges and Seaton Financial Impacts Agreement

Recommendation:

1. That Report FIN 11-19 of the Director, Finance & Treasurer bereceived;

2. That effective July 1, 2019 as provided for in By-law No.7595/17, the Development Charges (the “DCs”) referred to inSchedule “C” of that By-law be increased by 5.2 percent;

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3. That effective July 1, 2019 as provided for in By-law No.7595/17, the DCs referred to in Schedule “D” of that By-law beincreased by an annual indexing of 5.2 percent;

4. That effective July 1, 2019 the payments related to “10 per centSoft Services” as provided for by the Seaton Financial ImpactsAgreement (FIA) dated November 26, 2015 be increased by anannual indexing of 5.2 per cent; and,

5. That the appropriate City of Pickering officials be authorized totake the necessary actions as indicated in this report.

3.11 Director, Finance & Treasurer, Report FIN 12-19 173 Universal City One Developments Inc. – Request to Defer Payment of Development Charges

Recommendation:


2. That, pursuant to By-law 7595/17:

a) the request by Universal City One Developments Inc. todefer the payment of the City’s share of DevelopmentCharges in the amount of approximately $1,739,400 to theearlier of: (i) six months after the commencement offoundation construction at 1474 Bayly Street, Pickering or (ii)when above grade construction at the said address iscommenced, be approved;

b) that the requirements of Section 14(2) of By-law 7595/17 bewaived accordingly and that the date of issuance of the finalbuilding permit will determine the applicable DevelopmentCharge rate and, if the final building permit is issued beforeJuly 1, 2019, that the payment of Development Charges willbe based on the current rate plus interest, be approved;

c) that Universal City One Developments Inc., be required toenter into a Development Charge Deferral Agreement with

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the City on terms satisfactory to the Director, Finance & Treasurer and the Director, Corporate Services & City Solicitor; and,

3. That the appropriate officials of the City of Pickering beauthorized to give effect thereto.

3.12 Director, Finance & Treasurer, Report FIN 13-19 1782019 Final Tax Due Date for Commercial, Industrial, and Multi-Residential Realty Tax Classes

Recommendation:


2. That the Director, Finance & Treasurer be authorized to issuethe final 2019 Tax Bills for Commercial, Industrial and Multi-Residential properties with a due date of September 26, 2019;

3. That the Director, Finance & Treasurer be authorized to makeany changes or undertake any actions necessary, includingaltering the due date, in order to ensure that the tax billingprocess is completed and in order to comply with ProvincialRegulations;


5. That the appropriate City of Pickering officials be authorized totake the necessary actions as indicated in this report.

4. Other Business

5. Adjournment

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From:

Subject:

Marisa Carpino Director, Community Services

Beverage Supply Agreement Renewal - Coca-Cola Canada Bottling Limited- File: A-1440

Recommendation:

Report to Executive Committee

Report Number: CS 06-19 Date: June 17, 2019

1. That the Mayor and City Clerk be authorized to execute a Beverage Supply Agreement withCoca-Cola Canada Bottling Limited as set out in Attachment 1 to this report, subject to minorrevisions as may be required by the Director, Community Services and the Director,Corporate Services & City Solicitor; and,

2. That the appropriate City officials be authorized to take the necessary actions as indicated inthis report.

Executive Summary: Coca-Cola Canada Bottling Limited has an expired Beverage Supply Agreement with the City of Pickering to provide beverage vending services throughout City owned facilities. In recent months, Coca-Cola Canada Bottling Limited has proposed a four year renewal agreement, beginning on July 1, 2019 and ending on June 30, 2023.

The Community Services Department recommends that a renewal agreement be initiated with Coca-Cola Canada Bottling Limited.

Financial Implications: The revenue to be generated from Coca-Cola Canada Bottling Limited during each year of the term includes a $5,750 exclusivity bonus, $500 marketing fund and commissions sales of 20 percent estimated to total $9,600 annually. Year one will also include a signing bonus of $1,500.

Discussion: On June 5, 2013, Coca-Cola Refreshments Canada Company extended its Beverage Supply Agreement with the City of Pickering (dated September 1, 2003) in order for the City to reach the minimum volume of sales commitment specified within the agreement. On November 1, 2018, the minimum volume sale commitment was met allowing for a new beverage supply agreement to be negotiated.

The proposed renewal agreement is for a four year term beginning July 1, 2019 and ending June 30, 2023 and provides exclusivity to Coca-Cola Refreshments Canada Company for beverages sold in City owned and operated facilities including Pickering Civic Complex & Library, Pickering Recreation Complex & Arena, Don Beer Arena, George Ashe Library & Community Centre, East

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cs 06-19

Subject: Beverage Supply Agreement Renewal

June 17, 2019

Page 2

Shore Community Centre, and the Operations Centre. As part of the Beverage Supply Agreement, Coca-Cola Refreshments Canada Company will also provide Full Service Vending machines equipped with state of the art technology, canteen/concession cooler equipment and fountain machine at no additional cost. Furthermore, repair service calls can be made 24/7 with the goal of repairing the equipment within 24 hours.

As most City owned facilities do not include concession stand or snack bar type services, beverage vending machine services are vital to maintain customer health, wellness, and enjoyment while in City facilities. Healthy options are available within the vast product range of Coca-Cola Refreshments Canada Company which includes water, vitamin water, sports drinks, juices, and soft drinks. With an ·aim of sustainable packaging, Coca-Cola Refreshments Canada Company produces lightweight packaging which can be reused or recycled and in some cases, as with bottled water, the packaging integrates plant bottle technology (up to 30 percent plastic derived from plants). Waste Diversion bins are available by vending machines in our facilities to support recycling.

In an effort to encourage and support reusable plastics as an alternative, the City offers water bottle drinking fountains at Don Beer Arena, Pickering Recreation Complex Arena, Pickering Recreation Complex (Gym and Fitness Studios), and George Ashe Library & Community Centre. Additional water bottle filling stations will be installed at the Pickering Recreation Complex as part of the new renovation project and in all newly constructed community centres.

Coca-Cola Refreshments Canada Company is prevalent in the municipal marketplace and, as staff understand it, has similar Beverage Supply Agreements with Ajax, Oshawa, and Clarington. In our case, staff have found the services of Coca-Cola Refreshments Canada Company to be reliable and professional with regularly stocked and serviced vending machines and a diverse product range affording healthy options to our customers. As such, the Director, Community Services recommends that a renewed Beverage Supply Agreement be initiated with Coca-Cola Canada Bottling Limited for a four year term, beginning July 1, 2019 and ending June 30, 2023.

Attachments:

1. Beverage Supply Agreement between Coca-Cola Refreshments Canada Company and theCity of Pickering

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cs 06-19

Subject: Beverage Supply Agreement Renewal

Prepared By:

�vinHayes

Supervisor, Facilities Operations

MC:nm

Recommended for the consideration of Pickering City Council

Approved/Endorsed By:

rpino, MA

June 17, 2019

Page 3

Director, ommunity Services

c{)J �,mi 3, 2-0fj Tony Prevedel, P.Eng. . O -Chief Administrative Officer

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BEVERAGE SUPPLY AGREEMENT

B E T W E E N :

COCA-COLA CANADA BOTTLING LIMITED (“CCCBL”) Legal Department, 335 King Street East TORONTO, Ontario, M5A 1L1

OF THE FIRST PART;

-and-

THE CORPORATION OF THE CITY OF PICKERING (the “Customer”) Pickering Civic Complex One the Esplanade PICKERING, Ontario, L1V 6K7

OF THE SECOND PART.

THIS BEVERAGE SUPPLY AGREEMENT (the “Agreement”) witnesses that the Customer desires to retain the services of CCCBL for the supply of non-alcoholic beverages of any kind or type in all packages and formats (“Beverages”) and CCCBL agrees to provide such services to the Customer under the terms and conditions as follows:

1. Term

The term of this Agreement shall commence on July 1, 2019 and continue until June 30, 2023 (the “Term”), subject to the termination rights of the parties as set out in this Agreement. “Year of the Term” as used in this Agreement shall mean each twelve-month period from July 1 to June 30 in the Term.

2. Exclusivity

During the Term of this Agreement, the parties agree that the Customer shall be obligated to purchase Beverages manufactured, sold or distributed from time to time by or for CCCBL, and/or The Coca-Cola Company (together with their respective wholly owned subsidiaries) and their respective affiliates and licensors (“CCCBL Beverages”) as the exclusive Beverages sold, dispensed, served, sampled and advertised at (i) the buildings and facilities existing as at the commencement of the Term as described in Schedule B, and (ii) any other future buildings and facilities opened after the first day of the Term that are operated, owned, managed or controlled by the Customer, as determined by CCCBL, including any area or retail outlet of such current or future buildings and facilities that is subject to a concession agreement, leasehold, licensing, franchising or any other tenancy interest to or with any third party (collectively, the “Premises”).

3. Payment Terms, Price Increases and Adjustments

3.1. Payment Terms

The Customer agrees, subject to credit approval by CCCBL,to i) pay for CCCBL Beverages and other products at theprices as set out in Schedule A, exclusive of all applicable taxes, levies and deposits (“Prices”), and ii) pay for services supplied by CCCBL in accordance with CCCBL’s standard

trade terms. The Customer agrees that all consideration provided by CCCBL pursuant to this Agreement is contingent on CCCBL receiving payments as they are due for all CCCBL Beverages supplied by CCCBL throughout the Term.

3.2. Price Increases

The Prices shall be subject to increase once per Year of the Term by three and one-half percent (3.5%) effective on or about June 30 each calendar year.

3.3. Extraordinary Price Adjustment

Prices are also subject to an extraordinary price adjustment at any time during the Term, in the event of significant demonstrable increase in cost to CCCBL including without limitation, energy/utility costs (e.g. oil, gas, hydro), direct production, distribution costs, ingredient change, new formulation or raw materials (e.g. aluminium, plastic, sweetener) as determined by CCCBL and shall be effective on thirty (30) days’ notice (provided increases are the same as charged to similar customers purchasing similar volumes under similar circumstances).

3.4. Vend Prices

Prices for CCCBL Beverages sold through machines which store, chill and vend Beverages (the “Vending Equipment”), if applicable, shall be as discussed and notified by CCCBL to the Customer, and shall be subject to change if, as and when deemed necessary by CCCBL.

4. Other Business and Financial Terms

4.1. Lump Sum Exclusivity and Performance Allowance

Provided the Customer is in full compliance with the terms and conditions of this Agreement, CCCBL shall pay to theCustomer a one-time lump sum exclusivity and performance allowance for the Term in the amount of one thousand and five hundred dollars ($1,500.00) (the “LumpSum Exclusivity Allowance”) within thirty (30) days of thelater of the commencement or the execution of this Agreement by the parties. Notwithstanding the foregoing, regardless of the timing of payment, the Lump Sum Exclusivity Allowance will be deemed earned evenly throughout the Term.

4.2. Annual Exclusivity and Performance Allowance

Provided the Customer is in full compliance with the terms and conditions of this Agreement, CCCBL shall pay to theCustomer an annual exclusivity and performance allowancein the amount of five thousand seven hundred and fiftydollars ($5,750.00) for each Year of the Term (the “AnnualExclusivity and Performance Allowance”). The first payment of the Annual Exclusivity and Performance Allowance will

Attachment 1 to Report #CS 06-19

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be made within thirty (30) days of the later of the commencement or the execution of this Agreement by the parties, and thereafter payments will be made within thirty (30) days of the commencement of each Year of the Term.Notwithstanding the foregoing, regardless of the timing of payment, the Annual Exclusivity and PerformanceAllowance will be deemed earned evenly throughout the Term.

4.3. Marketing Fund

Provided the Customer is in full compliance with the terms and conditions of this Agreement, CCCBL shall pay to the Customer an annual marketing fund (the “Marketing Fund”) in the amount of five hundred dollars ($500.00) to support various marketing and/or advertising activities developed collaboratively by the parties to promote the sale of CCCBL Beverages at the Premises during each Year of the Term, including but not limited to point of sale signage and banners, menu boards, publicity contests and other consumer-facing advertising copies or activities.

4.4. Full Service Vending Commissions

In accordance with the exclusive rights of advertising and supply of Beverages granted herein by the Customer, CCCBL shall have the exclusive right to sell Beverages through Vending Equipment and to install, service, stock and collect revenues from such Vending Equipment (“Full Service Vending”). The content of the coin containers in the Vending Equipment shall remain the sole and exclusive property of CCCBL. CCCBL shall collect and be entitled to all revenue obtained in dispensing CCCBL Beverages through the use of the Vending Equipment. Notwithstanding the foregoing, provided the Customer is in full compliance with the terms and conditions of this Agreement, CCCBL shall pay, on a quarterly basis, a vending commission to the Customer on all CCCBL Beverages sold through the Vending Equipment at the rate of twenty percent (20%) of the revenues derived by CCCBL through Full Service Vending at the Premises, including all electronic card sales (as applicable), less goods and services taxes, any other applicable sales taxes and environmental deposit charges (the “Vending Commissions”). CCCBL shall keep accurate books of accounts and records of the revenue figures from the Vending Equipment, in accordance with generally accepted accounting principles, and shall allow the Customer access to these records upon reasonable request.

5. Equipment

The type, quantity and location of the equipment to be provided by CCCBL during the Term and used in the distribution, sale and advertising of CCCBL Beverages at the Premises during the Term, including Vending Equipment (the “Equipment”), shall be as mutually agreed upon by the parties.

The Customer shall sign CCCBL’s standard Equipment loan agreement for each piece of Equipment. In the event of a conflict or

inconsistency between the terms of this Agreement and the terms of CCCBL’s standard Equipment loan agreement, then the terms of this Agreement shall prevail.

Except for malfunctions of deficiencies of the Equipment caused by the Customer’s negligence, willful misconduct or unlawful conduct, as determined by CCCBL, acting reasonably, the Customer undertakes no obligation with respect to the costs of any repairs or replacement of parts, attachments or accessories for the Equipment. CCCBL shall be responsible for, and shall bear the expense of, all labour, parts or other materials required to return the Equipment to good operating order or perform any part of the maintenance or repair obligations of CCCBL hereunder. The Customer shall promptly notify CCCBL of any need for service or repairs using the toll-free telephone number located on the Equipment and shall allow CCCBL to enter the Premises on reasonable notice during regular business hours for the purpose of inspection or performance of maintenance and repair, or necessary replacement or return of the Equipment, as applicable.

The Customer acknowledges that the Equipment shall at all times remain the sole and exclusive property of CCCBL and no person other than CCCBL shall be authorized to repair, service, maintain, replace or relocate any of the Equipment during the Term.

The Customer shall maintain control of the Equipment and administer or manage the operations of the Equipment at all times while it is in the Premises.

CCCBL disclaims any and all express and implied warranties, including without limitation, those of merchantability and fitness for intended use, and CCCBL shall not be liable for any consequential, incidental or indirect damages.

Customer shall use the Equipment solely to refrigerate the CCCBL Beverages, and no other product, perishable or otherwise, shall be placed in such Equipment. Equipment must be available for use during normal hours of operation.

Without prejudice to CCCBL’s other rights under this Agreement, the Customer acknowledges that CCCBL may, at its sole discretion, remove any Equipment which is being used in contravention of this Agreement. In addition, CCCBL reserves the right to remove the Vending Equipment when the volumes do not justify its presence at the Premises, at CCCBL’s discretion.

The parties acknowledge and agree that at all times during the Term, a dedicated outlet connection must be maintained within three (3) feet of the Equipment. Equipment must be connected to an electrical wall socket with required 120 volts/15 amps. The use of an extension cord is strictly prohibited and not authorized under any circumstances.

The parties also acknowledge and agree that any cooler Equipment must be maintained free of obstruction (beside or behind) allowing for ventilation to occur.

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6. Insurance

The Customer shall obtain and maintain throughout the Term public liability insurance/commercial general liability insurance in the minimum amount of two million dollars ($2,000,000) per occurrence and two million dollars ($2,000,000) in the aggregate. The Customer will name CCCBL as an additional insured. The Customer shall furnish to CCCBL a certificate of insurance and shall notify CCCBL without delay of any loss or damage to the Equipment.

7. Confidentiality

The parties agree to take all necessary precautions to maintain the confidentiality of the terms and conditions contained herein. The parties acknowledge that this Agreement may be released pursuant to the provisions of the Municipal Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c.M.56, as amended. This acknowledgement shall not be construed as a waiver of any right to object to the release of this Agreement.

8. Notices

Any notice pursuant to this Agreement, shall be in writing and addressed at the addresses indicated above. Furthermore, the Customer consents to the sending of electronic communications by CCCBL to the Customer and such consent shall continue during and after the expiry of the Term.

9. Representations and Warranties

The Customer represents and warrants, and understands that CCCBL is relying upon such representations and warranties, that:

a. it is in good standing under the laws of its jurisdiction of incorporation, and has all requisite authority to perform allits obligations under this Agreement; and

b. there are no agreements, contracts, arrangements, termsor conditions, written or otherwise that would prevent theCustomer from entering into and complying with the terms of this Agreement.

10. Assignment of Agreement

Neither party may assign this Agreement without the prior written consent of the other party, which consent cannot be unreasonably withheld, conditioned or delayed. A change in the corporate control of either party shall be deemed to be an assignment requiring the consent of the other party.

11. Force Majeure

Neither party shall be liable hereunder for failure to perform so long as such failure occurs for a reason beyond the reasonable control of the non-performing party (i.e. strike, fire, storm, flood, act of any governmental authority, etc.). Performance by either party is suspended for the period of the force majeure event.

12. Taxation

The parties acknowledge that each party shall pay the GST/HST/QST and any other taxes eligible that apply to any payments made under this Agreement. The parties represent that their respective GST/HST/QST registration number(s), as applicable, are as follows:

a. For the Customer: GST/HST number: R108078593

b. For CCCBL:GST/HST number: 121928881 RT0001 QST number: 1003286416 TQ0001

13. Entire Agreement

This Agreement, together with its schedules and the recitals, constitutes the entire agreement of the parties and supersedes all prior communications, understandings and agreements relating to the subject matter hereof, whether oral or written.

14. Termination

If either party shall fail to perform or observe any covenant, condition or agreement to be performed or observed herein and such default continues unremedied for a period of ten (10) days after notice thereof from the other party, then such party may, at its option, terminate this Agreement in its entirety forthwith without prejudice to any other rights it may have in law or equity.

Notwithstanding anything in this Agreement to the contrary, the Customer agrees that if for any reason, including but not limited to any governmental board or regulatory body’s legislation, regulations, guidelines, recommendations or similar announcements or significant changes in the nature or size of the Customer’s business: (i) CCCBL’s advertising and supply rights under this Agreement are affected and CCCBL is requested to limit the sale or availability of any of its Beverages, or (ii) CCCBL is prohibited or prevented from making available or selling any of its Beverages, or (iii) the volume of CCCBL Beverages being purchased and paid for is materially affected, CCCBL shall be entitled, in its sole discretion, to propose to the Customer a reasonable adjustment of CCCBL’s financial obligations to the Customer for the remainder of the Term (and if necessary a refund of a portion of unearned payments). The parties will negotiate such proposed adjustment in good faith for a period of sixty (60) days, but if they are unable to agree, CCCBL shall have the right, at its option, to terminate this Agreement.

In the event this Agreement is terminated for any reason, the following provisions will apply as of the effective date of such termination:

i. the Customer shall surrender the Equipment and allow CCCBL to promptly remove such Equipment; and

ii. the parties shall forthwith calculate, determine and pay all accounts between the parties relating to this Agreement upto the effective date of termination, including, if applicable, a pro-rata reimbursement to CCCBL of all consideration paid in advance to the Customer including, without

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limitation, any payment made to the Customer pursuant to Section 4.

The rights and remedies of the parties as set forth in this Agreement are cumulative and shall in no way be deemed to limit any of the other provisions of this Agreement or otherwise to deny the parties any right or remedy at law or in equity.

15. Miscellaneous

Brands and package formats of CCCBL Beverages are subject to availability and change from time to time, at CCCBL’s sole discretion.

The Customer agrees that it shall not use trademarks of CCCBL Beverages without first obtaining specific written permission from CCCBL.

IN WITNESS WHEREOF the parties hereto, by their respective representatives duly authorized in that behalf, have caused this Agreement to be executed.

THE CORPORATION OF THE CITY OF PICKERING

Per: ____________________________ Name: Title:

Authorized to sign

Date signed:

COCA-COLA CANADA BOTTLING LIMITED

Per: ____________________________ Name: John Stiefelmeyer Title: VP, Operations

Authorized to sign

Date signed:

Approved for execution:

Sales rep.: Jamie Collins-Mullen

___________________ Initials of sales rep.

___________________ Legal Department

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Schedule A

Prices

Brands/ Product description Package Units/ Case Price/ Case SPC

Conversion Rate/ Case

Over-the-counter Beverages (packaged goods)

All brands (carbonated soft drinks) 355 ml cans 12 $5.16 0.5

All brands (carbonated soft drinks) 355 ml cans 24 $10.33 1

All brands (carbonated soft drinks) 500 ml bottles 24 $26.50 1

Fanta 473 ml bottles 12 $13.25 0.5

Monster Java 444 ml cans 12 $24.50 0.5

Monster/ NOS/ Full Throttle 473 ml cans 12 $24.50 0.5

Nestea 500 ml bottles 12 $16.50 0.5

Powerade 591 ml bottles (flat cap) 24 $25.00 1

Powerade 710 ml bottles (sport cap) 12 $17.00 0.5

Dasani 591 ml bottles 24 $14.00 1

Evian 500 ml bottles 24 $30.00 1

Glaceau smartwater 591 ml bottles 24 $30.00 1

Glaceau smartwater sparkling 591 ml bottles 24 $30.00 1

Glaceau vitaminwater 591 ml bottles 12 $18.50 0.5

Minute Maid 355 ml bottles 12 $16.50 0.5

Core Power 340/414 ml bottles 12 $29.00 0.5

Post-Mix Syrup (Fountain)

All brands (carbonated soft drinks) 10 L bag-in-box 1 $32.68 2.642

All brands (carbonated soft drinks) 20 L bag-in-box 1 $65.41 5.284

Nestea/ Fruitopia 20 L bag-in-box 1 $65.41 5.284

Other Products

C02 20 lbs. 1 $26.49 1

APPLICABLE TAXES, LEVIES OR DEPOSITS ARE NOT INCLUDED IN THE PRICE FOR CCCBL BEVERAGES AND SUCH ITEMS ARE SUBJECT TO INCREASE BY CCCBL.

BRANDS AND PACKAGE FORMATS SUBJECT TO AVAILABILITY AND CHANGE DURING THE TERM. CCCBL RESERVES THE RIGHT TO CHANGE PRODUCT AND/OR CASE SIZES OR SELL OTHER CCCBL BEVERAGES TO THE CUSTOMER, RESULTING IN POSSIBLE CHANGES TO THE SPC CONVERSION.

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Schedule B

Premises

Pickering Civic Complex – One the Esplanade, Pickering, Ontario, L1V 6K7

Delaney Arena – 1867 Valley Farm Rd., Pickering, Ontario, L1V 3Y7

Don Beer Arena – 940 Dillingham Rd., Pickering, Ontario, L1W 1Z6

Eastshore Community Centre – 910 Liverpool Rd., Pickering, Ontario, L1W 1S6

City of Pickering Library – One the Esplanade, Pickering, Ontario, L1V 6K7

O’Brien Arena – 1867 Valley Farm Rd., Pickering, Ontario, L1V 3Y7

George Ashe Community Centre – 470 Kingston Rd., Pickering, Ontario, L1V 1A4

City of Pickering Recreation Centre – 1867 Valley Farm Rd., Pickering, Ontario, L1V 3Y7

City of Pickering Work Centre – 2570 Tillings Rd., Pickering, Ontario, L1V 2P8

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--C6;Jof p](KERJNG

From: Marisa Carpino Director, Community Services

Subject: Quotation No. Q-7-2019

Report to

Executive Committee


- Supply and Delivery of Road Grader with Attachments- File: A-1440-001-19

Recommendation:

1. That Quotation No. Q-7-2019 submitted by Toromont CAT in the amount of $361,823.10(HST excluded) be accepted;

2. That the total gross project cost of $410,555.00 (HST included), including the amount ofthe quotation, optional equipment (Automated Grade Control system) and otherassociated costs, and the total net project cost of $369,717.00 (net of HST rebate) beapproved;

3. That the Director, Finance & Treasurer be authorized to finance the total net project costin the amount of $369,717.00 as follows:

a) the sum of $350,000.00, as provided for in the 2019 Capital Budget, be increased to$369,000.00, to be financed by the issue of debentures by the Regional Municipalityof Durham over a period not to exceed five years;

b) the balance sum of $717.00 to be funded from property taxes;

c) the annual repayment charges in the amount of approximately $81,150.00 beincluded in the annual Current Budget for the City of Pickering commencing 2019, orsuch subsequent year in which the debentures are issued, and continuing thereafteruntil the debenture financing is repaid, and any financing cost to be paid out of theCurrent Budget;

d) the Treasurer be authorized to make any changes, adjustments, and revisions toamounts, terms, conditions, or take any actions necessary in order to effect theforegoing;


5. That the appropriate officials of the City of Pickering be authorized to take the necessaryactions as indicated in this report.

- 10 -

cs 08-19


June 17, 2019

Page 2

Executive Summary: The Public Works Section, within the Community Services Department, currently utilizes two road graders with attachments for the approximate 100 km of unpaved roads in the northern rural areas of Pickering. The 2009 road grader with attachments (unit #100) was approved for life-cycle replacement in the 2019 Capital Budget.

An advertisement was placed on the City's website. Two companies responded by the closing date of Tuesday, April 9, 2019. The quotation submitted by Toromont CAT for one Caterpillar 140 road grader, has received the highest score from the Evaluation Committee, meets the required specifications, and is recommended for approval.

In accordance with the Purchasing Policy Item 06.11 (c), where the compliant quotation or tender meeting specifications and offering best value to the City is acceptable or where the highest scoring proposal is recommended and the estimated total purchase price is over $250,000.00, the Manager may approve the award, subject to the approval of the Director, Treasurer, CAO and Council.

Financial Implications:

1. Quotation Amount

Supply and Delivery of Road Grader Automated Grade Control System

Total HST (13%)

Total Gross Quotation Cost

2. Estimated Project Costing Summary

Quotation No. Q-7-2019 and Automated Grade Control System GPS/2 Way Radio (Optional price)

Total HST (13%) Gross Project Cost HST Rebate (11.24%)

Total Net Project Cost

$339,869.18 21,953.92

361,823.10 47,037.00

$408,860.10

$361,823.00 1,500.00

363,323.00 47,232.00

$410,555.00 ($40,838.00)

$369.717.00

- 11 -

cs 08-19


June 17, 2019

Page 3

3. Approved Source of Funds2019 Roads Equipment Capital Budget

Description

Supply and Delivery of Road Grader with Attachments

Account Code Source of Funds Available Budget

5319.1901.6178 Debt - 5 years $350,000.00

Property Taxes

Required

$369,000.00

717.00

Total Funds $350,000.00 $369,717.00

Net Project Cost under (over) Approved Funds ($19,717.00)

Discussion: The Public Works Section, within the Community Services Department, currently uses two road graders with attachments. These road graders are used year round to maintain over 100 kms of unpaved roads in north Pickering.

One existing road grader, unit #100, was approved for life-cycle replacement in the 2019 Capital Budget. An Evaluation Committee consisting of Public Works staff met on April 24, 2019 and each committee member evaluated the quotations based on the rated criteria. A combined average score for each quotation was determined as part of Stage II of the evaluation process. Toromont CAT received the highest score.

It has been determined that the optional equipment quoted in the quotation for an Automatic Grade Control system (AGC) be purchased. The AGC system is an essential piece of equipment that will assist the operator in maintaining gravel roads to a higher standard than at present. City staff have done their due diligence to ensure that the AGC system would be a benefit to the City by conversing with other municipalities that currently utilize the system. During these discussions, the benefits of an AGC system included being able to complete the work in a more timely manner with reduced material usage due to the accuracy of the grade control; and, better fuel efficiency with the reduction in work hours and down pressure on the grader required to carry out the task.

After careful review of all submissions received, Public Works staff recommends acceptance of the Quotation No. Q-7-2019 submitted by Toromont CAT for one new road grader with attachment in the amount of $339,869.18 (plus HST) as well as optional pricing for an AGC system for $21,953.92 (plus HST) and that the total net project cost of $369,717.00 (net of HST rebate) be approved.

- 12 -

cs 08-19


Attachments:

June 17, 2019

Page 4

1. Supply & Services Memorandum dated May 3, 20192. By-law to authorize the Supply and Delivery of Road Grader with Attachments project and

the issuance of debentures in the amount of $369,000.00

Supervisor, Municipal Garage

Rob Burlie, P. Eng. Manager, Public Works

MC:nw



ino, MA Director, Community Services

Stan Karwowski, MBA, CPA, CMA Director, Finance & Treasurer

Ray R drigues, CPPB Manager, Supply & Services

rU �3, '2Pl'fTony Prevedel, P. Eng. Chief Administrative Officer

- 13 -

To: Marisa Carpino Director, Community Services

From: Lisa Chang Buyer, Supply & Services

Copy: Administrative Assistant, Community Services Manager, Supply & Services Supervisor, Roads Operations

Subject: Quotation No. Q-7-2019 Supply & Delivery of Road Grader with Attachments Closing Date: Tuesday, April 16, 2019 at 12:00 Noon. File: F-5300-001

REPORT

Memo

April 26, 2019

Quotation Q-7-2019 was advertised on the City's website on March 19, 2019 of which two (2) company(ies) have responded.

Stage I - Mandatory Submission Requirements - determines which submissions satisfy all the mandatory submission requirements and provides Respondents the opportunity to rectify deficiencies. Two (2) proposals proceed to Stage II - Evaluation.

A summary of the Stage II and Ill evaluation results for each quotation is attached.

Toromont CAT is the top ranked respondent with a submitted price of $339,869.18 (HST Excluded).

A budget of $350,000.00 was provided to Supply & Services for this procurement.

In accordance with Appendix D - Request for Quotation Particulars, Item 16 - Insurance, the following documents will be requested from Toromont CAT:

(a) The City's certificate of insurance or approved alternative form shall becompleted by the bidder's agent, broker or insurer.

Please advise if-Supply & Services is to proceed with this task.

In accordance with Purchasing Policy Item 06.04, the authority for the dollar limit as set out below excludes HST.

In accordance with Purchasing Policy, Item 06.11, where the compliant quotation or tender meeting specifications and offering best value to the City is acceptable or where the highest scoring proposal is recommended and the estimated total purchase price is:

(c) Over $250,000, the Manager may approve the award, subject to the approval of theDirector, Treasurer, CAO and Council.

- 14 -

Subject to receipt of approvals on Health & Safety and insurance documents, please provide your recommendation in report form. After receiving Council's approval, an approved "on-line" requisition will be required to proceed.

Please direct all enquiries to Supply & Services. Respondents will be advised in due course.

If you require further information or assistance, do not hesitate to contact me or a member of Supply & Services.

LC Attachments (2)

Page 2 of 2 - 15 -

ACHM!::i\l r #

The Corporation of the City of Pickering

By-law No.

Being a by-law to authorize the Supply and Delivery of One New Latest Model Year Road Grader with Attachments project in the City of Pickering and the issuance of debentures in the amount of $369,000.00

Whereas Section 11 of the Municipal Act, 2001, as amended, provides that a lower-tier municipality may pass by-laws respecting matters within the spheres of jurisdiction described in that Section; and,

Whereas Subsection 401(1) of the Municipal Act, 2001, as amended, provides that a municipality may incur a debt for municipal purposes, whether by borrowing money or in any other way; and,

Whereas Subsection 401 (3) of the Municipal Act, 2001, as amended, provides that a lower-tier municipality in a regional municipality does not have the power to issue debentures; and,

Whereas The Regional Municipality of Durham has the sole authority to issue debentures for the purposes of its lower-tier municipalities including The Corporation of the City of Pickering (the "City"); and,

Whereas the Council of the City wishes to proceed with debenture financing for the Supply and Delivery of One New Latest Model Year Road Grader with Attachments project; and

Whereas before authorizing the Supply and Delivery of One New Latest Model Year Road Grader with Attachments project, the Council of the City had the Treasurer update the City's Annual Repayment Limit, the Treasurer calculated the estimated annual amount payable in respect of such project and determined that such annual amount would not cause the City to exceed the updated limit and therefore, the Local Planning Appeal Tribunal approval is not required as per Section 401 of the Municipal Act, 2001, as amended, and the regulations made thereunder;

And whereas after determining that the Local Planning Appeal Tribunal approval is not required, the Council of the City approved report CS 08-19 on the date hereof and awarded Quotation No. Q-7-2019 for the Supply and Delivery of One New Latest Model Year Road Grader with Attachments project;

- 16 -

BY-LAW NO Page 2

Now therefore the Council of The Corporation of the City of Pickering hereby enacts as follows:

1. That the City proceed with the project referred to as "Supply and Delivery of OneNew Latest Model Year Road Grader with Attachments";

2. That the estimated costs of the project in the amount of $369,717.00 be financed asfollows:

a) the sum of $369,000.00 be financed by the issue of debentures by theRegional Municipality of Durham over a term not to exceed five years; and

b) the sum of $717.00 be funded from property taxes;

3. That the funds to repay the principal and interest of the debentures be provided forin the annual Current Budget for the City commencing in 2019 or such subsequentyear in which the debentures are issued and continuing thereafter until thedebenture financing is repaid.

By-claw passed this 24th day of June, 2019

David Ryan, Mayor

Susan Cassel, City Clerk

- 17 -

--Clpof-

p](KERJNG




Subject: Gingerbread Co-operative Nursery School (Pickering) Inc. - Licence Agreement Renewal- File: A-1440

Recommendation:

1. That the Mayor and City Clerk be authorized to execute a License Renewal Agreement withGingerbread Co-operative Nursery School (Pickering) Inc. as set out in Attachment 1 to thisreport, subject to minor revisions as may be required by the Director, Community Servicesand the Director, Corporate Services & City Solicitor;

2. That the appropriate City officials be authorized to take the necessary actions as indicated inthis report.

Executive Summary: Gingerbread Co-operative Nursery School (Pickering) Inc. has an existing Licence Agreement with the City of Pickering to provide a cooperative nursery program at West Shore Community Centre, for a five year term beginning September 1, 2014 and ending June 30, 2019. Gingerbread Co-operative Nursery School (Pickering) Inc. has requested to renew this agreement for a further five year term beginning September 1, 2019 and ending June 30, 2024.

The Community Service's Department recommends that a renewal agreement be initiated with Gingerbread Co-operative Nursery School (Pickering) Inc.

Financial Implications: The revenue to be generated from Gingerbread Co-operative Nursery School (Pickering) Inc. during the five year renewal term is as follows:

• September 1, 2019 to June 30, 2020: $4,850 incl. HST ($485 incl. HST per month)• September 1, 2020 to June 30, 2021: $4,960 incl. HST ($496 incl. HST per month)• September 1, 2021 to June 30, 2022: $5,070 incl. HST ($507 incl. HST per month)• September 1, 2022 to June 30, 2023: $5,180 incl. HST ($518 incl. HST per month)• September 1, 2023 to June 30, 2024: $5,300 incl. HST ($530 incl. HST per month)

This represents an approximate two percent increase in annual licence fees.

- 18 -

cs 24-19

Subject: Gingerbread Co-operative Nursery School (Pickering) Inc.

June 17, 2019

Page 2

Discussion: On July 14, 2014, Council approved Resolution #260/14 authorizing the execution of a Licence Agreement with Gingerbread Co-operative Nursery School (Pickering) Inc. for the purposes of operating a cooperative nursery program for a minimum of three half days per week from September to June annually at West Shore Community Centre for a five year term beginning September 1, 2014 and ending June 30, 2019.

The use of the West Shore Community Centre for the provision of a cooperative nursery program is a positive and proactive use of this facility and is consistent with the City's mandate to support children and families and to build community.

As such, the Director, Community Services recommends that a renewal agreement be initiated with Gingerbread Co-operative Nursery School (Pickering) Inc. to ren�w the Licence Agreement for a further five year term, beginning September 1, 2019 and ending June 30, 2024.

Attachments: 1. Draft Licence Agreement for Gingerbread Co-operative Nursery School (Pickering) Inc.,

2019-2024

Prepared By:

Kevin Hayes Supervisor, Facilities Operations

MC:nm


Tony Prevedel, P.Eng. Chief Administrative Officer


Marisa rpino, MA Director, Community Services

- 19 -

HM N #

This Licence Agreement is made as of July 1, 2019

Between:

The Gingerbread Co-operative Nursery School (Pickering) Inc.

(the "School")

- and -


(the "City")

0 REPORT#£.5..c94-/9

Whereas the City owns the community centre known as the West Shore Community Centre at 1011 - 1015 Bayly Street in the City of Pickering (the "Community Centre"); and

Whereas the School wishes to use the Community Centre and associated facilities for the purpose of operating a co-operative nursery school; and

Whereas the City is prepared to grant a licence to the School to permit the School to use the Community Centre and associated facilities for such purpose;

Now Therefore the City and the School agree as follows:

Licence

1. The City grants to the School a licence to occupy and use the Community Centreand associated facilities for the purpose of operating a co-operative nurseryschool on the terms and conditions set out in this Licence (the "Purpo_se").

2. The School shall also be permitted to. use the Community Centre one (1) eveningor weekend day in each year of the Term for· fund raising efforts, provided suchdates are requested in advance in writing to the City and are subject toavailability and approval by the City.

Term

3. The City grants to the School the right to use the Community Centre andassociated facilities for the Purpose during the months of September to June,both inclusive, each year throughout the term of this Licence commencing onSeptember 1, 2019 and ending _on June 30, 2024 (the "Term").

- 20 -

Gingerbread Co-op Nursery School Licence Agreement Page 2

4. Either the School or the City may terminate this Licence without cause prior tothe expiry of the Term by giving 90 days written notice to the other.

Fees

5. During the first year of the Term (September 1, 2019 to June 30, 2020), theSchool shall pay to the City the fixed sum of $4, 850.00 (including HST) in ten(10) equal monthly payments of $485.00 (including HST) payable on the 1st dayof each month of September to June, both inclusive. During each subsequentyear of the Term, the School shall pay to the City the fixed sums listed below inten (10) equal monthly payments payable on the 1st day of each month ofSeptember to June, both inclusive.

Year Two (September 1, 2020 - June 30, 2021) Year Three (September 1, 2021 - June 30, 2022) Year Four (September 1, 2022 - June 30, 2023) Year Five (September 1, 2023 - June 30, 2024)

$4,960.00 (including HST) $5,070.00 (including HST) $5,180.00 (including HST) $5,300.00 (including HST)

6. The School shall provide ten (10) post-dated cheques prior to the start of eachyear of the Term, payable to the City, in the amounts set out in Section 5.

Operation

7. The School shall,

(a) comply strictly with all applicable laws, by-laws, rules and regulationsgoverning the operation of the School;

(b) operate the school for a minimum of three (3) days and a maximum of five(5) days per week from 8:00 am to 12:30 pm during the months ofSeptember to June, both inclusive, each year throughout the Term;

(c) ensure that its operations conclude by 12:30 pm on any given operatingday to facilitate the use of the Community Centre and associated facilitiesfor other purposes;

(d) prior to September 1st each year of the Term, notify the City in writing ofwhich three (3) to five (5) days of the week it will operate during theensuing year of the Term;

(e) in the event that the School elects to operate for more than three (3) daysper week within a given year during the Term, pay an additional fee in theamount of $150 per month (including HST) for each additional day ofoperation (over and above the minimum of three (3) days per week);

(f) provide and pay for all personnel and supplies required by it for thePurpose;

2

- 21 -


(g) obtain all necessary permits, licenses and approvals that may be requiredin connection with the operation of the school; and

(h) maintain the Community Centre in a clean, sanitary and attractivecondition satisfactory to the City throughout the Term and, at the end ofthe Term, repair or replace any damages to the Community Centre saveand except reasonable wear and tear, at its sole cost and expense.

8. The City shall provide,

(a) all necessary electrical power, heat and other utilities;

(b) equipment storage cupboards; and

(c) a kitchenette facility for the purpose of providing light snacks for Schoolstaff and children.

9. The City assumes no responsibility to the School and shall not be liable for anyloss or damage incurred by the School arising from temporary or unavoidableinterruption of the supply of electrical power, heat or other utilities due to anycause whatsoever. The City shall use reasonable diligence to restore any suchservices whenever they are interrupted.

Insurance

10. The School, at its own expense, shall provide,

(a) comprehensive general public liability insurance, identifying the Cityas an additional insured, including coverage for personal injury,contractual liability, tenant's legal liability, non-owned automobileliability, death and property damage, on an occurrence basis withrespect to the business carried on at the Community Centre andthe School's use and occupancy of the Community Centre, withcoverage for any one occurrence or claim of not less than$5,000,000, which insurance shall protect the City in respect ofclaims by the School as if the City was separately insured; and

(b) a certificate of insurance coverage in a form satisfactory to the City,which insurance coverage shall be kept in full force and effectthroughout the Term.

11. The School shall not do or omit or permit to be done anything that causes anyinsurance premium of the City to be increased, and if any insurance premiumshall be so increased, the School shall pay to the City forthwith upon demand theamount of such increase. If notice of cancellation or lapse shall be givenrespecting any insurance policy of the City or if any insurance policy shall be

3

- 22 -


cancelled or refused to be renewed by an insurer by reason of the use or occupation of the Community Centre, the School shall forthwith remedy or rectify such use or occupation upon being requested to do so in writing by the City and if the School shall fail to do so the City may, at its option, terminate this Licence forthwith by notice to the School and the School shall immediately vacate the Community Centre.

Liability and Indemnification

12. The School shall indemnify and save harmless the City from and against any andall actions, losses, damages, claims, costs and expenses (including, wi_thoutlimiting the generality of the foregoing, all claims for personal injury, death and/orproperty damage) and also damages arising from any breach of this Licence bythe School or from any act or omission of the School or those for whom theSchool is at law responsible in or around the Community Centre and associatedfacilities arising from the School's use and occupation of the Community Centreand associated facilities. The City shall not be liable for any loss or damage toany property belonging to the School or to any other persons or for any injury toany person while such person or property is in or around the Community Centreand associated facilities, unless such loss, damage or injury is caused directly bythe negligence of the City, or those for whom the City is at law responsible.

Default

13. If at any time the School is in default in the performance of any of the obligationsunder this Licence and such default continues for fifteen (15) days after thereceipt by the School of notice from the City setting out the particulars of suchdefault, the City shall have the right to terminate this Licence forthwith andthereupon all the rights of the School under this Licence shall immediately ceaseand the City shall not be liable for payment to the School of any moneyswhatsoever by reason of such termination.

General

14. The City shall have the right to enter the Community Centre at any time for anyreason provided all reasonable efforts are made to minimize any disruption tothe School's use of the Community Centre.

15. The School shall not exhibit or allow to be exhibited on the exterior of theCommunity Centre any sign, notice, notice board, painting, design oradvertisement without the prior consent of the City.

16. The School shall not alter, add to or vary in any way any part of the CommunityCentre without the prior approval of the City.

17. This Licence shall not be assignable by the School without the consent of theCity, which consent may be arbitrarily refused.

4

- 23 -


18. This Licence shall enure to the benefit of and be binding upon the parties andtheir respective successors and permitted assigns.

19. No amendment to this Licence shall be effective unless it is in writing and signedby both parties.

20. (1) Any notice to the City under this Licence shall be in writing and shall bedelivered to the following address:

Pickering Civic Complex One The Esplanade Pickering, Ontario L 1V 6K7

Attention: City Clerk

(2) Any notice to the School under this Licence shall be in writing and shall bedelivered to the following address:

Gingerbread Nursery SchoolPO Box 427, Stn MainPickering, ON L 1V 2R7

Attention: President

(3) Notice shall be sufficiently given if delivered in person or sent byregistered mail or sent by facsimile transmission during normal businesshours on a business day.

(4) Each notice sent shall be deemed to have been received on the day itwas delivered or on the third (3rd) business day after it was mailed.

(5) The parties may change their address for notice by giving notice to theother in the manner provided in this Section.

21. The recitals to this Licence are true in substance and fact and are. incorporated herein.

22. Should any provision or provisions of this Licence be illegal or notenforceable, it or they shall be considered separate and severable fromthis Licence and its remaining provisions shall remain in force and bebinding upon the parties hereto as though the said provision or provisionshad never been included.

5

- 24 -

Gingerbread Co-op Nursery School Licence Agreement

23. The headings in this Licence have been inserted as a matter ofconvenience and for reference only and in no way define, limit or enlargethe scope of meaning of this Licence nor any of the provisions hereof.

Page 6

24. This Licence and any information or documents that are provided hereunder maybe released pursuant to the provisions of the Municipal Freedom of Informationand Protection of Privacy Act, R.S.O. 1990, c.M.56, as amended. Thisacknowledgement shall not be construed as a waiver of any right to object to therelease of this Licence or of any information or documents.

In Witness Whereof the City and the School have signed this Licence as of the date first written above.

Gingerbread Co-operative Nursery School (Pickering) Inc.


David Ryan, Mayor


6

- 25 -

/°./ i ---L-U,fj oo---

1 KE R1 NG


Subject: Community Festivals and Events



- Approval of Christmas Market in Esplanade Park- File: A-1440-001

Recommendation:

1. That Council authorize staff to issue a park permit for the use of Esplanade Park byGraymatter Marketing Solutions from Friday, November 29 to Saturday, November 30, 2019(inclusive) for a Christmas Market, on terms and conditions satisfactory to Director,Community Services and Chief Administrative Officer; and,


Executive Summary: The Community Festivals and Events Policy CUL 070 (the "Policy") outlines the criteria, guidelines and processes by which requests to host private and/or public events in City Parks are received and considered for approval. Prospective applicants are supported by the Community Events staff team and the Community Festivals & Events Manual which provides key information, timelines and required documentation to apply for events in City parks.

As per section 05.02(b) in the Policy, the permitting of Esplanade Park for public events is subject to the approval of Council. Therefore, the purpose of this report is to seek Council endorsement of the Christmas Market proposed to take place at Esplanade Park on Friday, November 29 from 6 pm to 9 pm and Saturday, November 30, 2019 from 10 am to 9 pm. The Market will coincide with the Tree Lighting event on Friday, November 29th

, and organizers will operate independently on Saturday, November 30th .

Financial Implications: Applicants are responsible to coordinate and operate all aspects of their events including marketing, event organization and operation, set up, and clean up according to the terms and conditions set out by the City of Pickering. The City of Pickering will work closely with the organizers to plan and execute the event on Friday evening which takes part during the City's Tree Lighting. Applicants are also responsible for all costs associated with application fees including park permit fees, table rentals, garbage/recycling receptacles, etc. (as per the Summary of Fees and Charges Schedule) and the costs associated with paid duty police officers and/or contracted security guards as required by the City.

PC

- 26 -

cs 30-19


June 17, 2019

Page 2

For events with attendance greater than 1,000 guests, City staff are in attendance to oversee weather and emergency operations, check that conditions of the agreements are being met, and to provide a City staff contact during event operations. To be clear, in-kind City staff resources are contributed with each event in order to facilitate and support the event planning, implementation, set up and clean up. Total value of in-kind support for this event is estimated at $5,200.00.

Discussion: As per section 05.02(b) of the Policy, staff are required to seek Council approval for event applications proposed to operate in Esplanade Park. Graymatter Marketing Solutions has submitted an application to host a Christmas Market in Esplanade Park on Friday, November 29, 2019 from 6 pm to 9 pm and Saturday, November 30, 2019 from 10 am to 9 pm which includes event set up and clean up.

Open to all ages, the Christmas Market will feature a variety of craft vendors, food trucks, alcoholic beverages in enclosed tasting areas, entertainment, games and a horse drawn carriage ride. Organizers are seeking sponsorships in order to offer a light display tunnel through the middle of Esplanade Park. A portion of the proceeds from the festival will be donated to a local charity, Dreams & Wishes. The aim of the charity is to preserve and create childhood memories by fulfilling 'dreams and wishes' made by children and families deemed underprivileged and in need at the holiday season.

As part of their two day permit, Graymatter Marketing Solutions is requesting access to electrical, water, picnic tables, restroom facilities, and garbage units. The Coordinator, Community Partnerships has met with the organizer to identify costs based on their event request. City staff from applicable Departments (Community Events Committee) have reviewed this two day event request and also supports the event, in principle, subject to the following event/festival requirements being met by the applicant during the event planning process:

• terms and conditions of the City of Pickering Community Events Partnership Agreement• proof of five million dollars in liability insurance• proof of Liquor Licence• City approval of vendor listing• electrician onsite to oversee all electrical hook-ups• adherence to City traffic management plan for event• road occupancy permit• Region of Durham permit for water hook-up and inspection• rentals and event equipment and supplies• fire inspection for all vendors• building permit for all structures exceeding 600 square feet• locates completed for all staked and grounded equipment• Region of Durham community festival coordinator and vendor permits• rental of all required portable restroom and hand-washing stations• rental and installation of all required perimeter fencing• submission of site plan and emergency response plan• adherence to the City's Emergency Weather Standard Operating Procedure• hiring of site security and police officers to monitor event operations

- 27 -

cs 30-19


June 17, 2019

Page 3

About Graymatter Marketing Solutions - Graymatter Marketing Solutions is a full-service marketing and communications firm, established in Pickering for the past seven years, with experience in all aspects of strategic development including branding of business, print and online strategies, relationship building, event planning, website creation, electronic marketing and social media, all key to strong brand growth. Graymatter has 25 years' experience in the marketing and publishing world working with companies like Avon Canada and Kraft Canada as well as continuing to create and publish custom material such as Durham Region's MOVE magazine, Ontario's Navigate Magazine, and soon to launch, Your City, the City of Pickering's first custom publication.

Graymatter Marketing Solutions Event Planning Team strives to make each event a success from beginning planning stages through to execution. They have created successful open house events for multiple businesses in Durham Region to launch their business and showcase their space into the public eye. Graymatter have also organized corporate events and conferences for organizations such as VRA Canada, Emergency Nurses of Ontario and Avon Canada Foundation. Hundreds of people attend these events.

Attachments: n/a

Prepared By:

Tanya Rye Supervisor, Cultural Services

MC:tr



pino ommunity Services

d)J ��, 20 /'1


- 28 -

--Ciijj of-P 1 (KER J NG

From: Richard Holborn Director, Engineering Services

Subject: Amendment to Traffic and Parking By-law 6604/05


Report Number: ENG 07-19 Date: June 17, 2019

- Inclusion of New Roads and Traffic Controls, Kindwin Subdivision- File: A-1440

Recommendation:

1. That the attached draft by-law be enacted to amend Schedule "2", Schedule "5", Schedule"6'', Schedule "7", Schedule "9" and Schedule "1 0" to By-law 6604/05 to provide for theregulation of stopping and parking on highways or parts of highways under the jurisdiction ofthe Corporation of the City of Pickering, specifically to provide for the inclusion of new roadsand traffic controls into the Traffic and Parking By-law; and


Executive Summary: In an effort to keep the Traffic and Parking By-law 6604/05 up to date and current, Engineering Services staff are proposing updates to Schedule "2", Schedule "5", Schedule "6", Schedule "7", Schedule "9" and Schedule "1 0", specifically for the inclusion of new roads and traffic controls in the Kindwin subdivision.

Financial Implications: The installation of all posts and signs can be accommodated within the Current Roads Budget. There is no direct cost to the Municipality related to the recommendations of this report.

Discussion: In an effort to keep the Traffic and Parking By-law 6604/05 up to date and current, Engineering Services staff are proposing updates, specifically for the inclusion of new roads and traffic controls within the Kindwin subdivision.

The proposed updates to By-law 6604/05 includes updates to Schedule "2", Schedule "5", Schedule "6'', Schedule "7", Schedule "9" and Schedule "10", which are described in detail in the following sections. The roads and traffic controls are shown in Attachment 1.

- 29 -

ENG 07-19

Subject: Amendment to Traffic and Parking By-law 6604/05 Kindwin Subdivision

Additions to Schedule "2", No Parking

June 17, 2019

Page 2

The following locations are new restrictions and are currently signed using temporary "no parking" signs and posts. These parking restrictions are proposed to be added to Schedule "2".

• south side of Usman Road from Brock Road (north intersection) to Saffron Drive (northintersection)

• south side of Usman Road from Brock Road (south intersection) to Saffron Drive (southintersection)

• east side of Usman Road from Saffron Drive (north intersection) to Saffron Drive (southintersection)

• north side of Magenta Road along the full limit• both sides of Azure Mews along the full limit• north side of Jade Street along the full limit• south side of Jade Street from Azure Mews to 10 metres east thereof

Additions to Schedule "5", Prohibited Turns

The following locations have been signed to prohibit turning movements and are proposed to be added to Schedule "5". These locations represent turns onto laneways where the width and design of the roadway presents a challenge for two-way traffic and therefore has been designated as one-way. In addition, these locations were previously requested by the Region of Durham to operate as one-way due to difficulties with garbage pick-up if the road was to remain with two-way traffic.

• Magenta Road at Azure Mews, westbound right turn is prohibited• Azure Mews at Magenta Road, northbound through is prohibited

Additions to Schedule "6", Through Highways

A 'through highway' is defined as a road or portion of road to which vehicular traffic from intersecting roads are required by law to stop before entering or crossing. The following roads are new through highways and are proposed to be added to Schedule "6".

• Usman Road - Full Limit• Saffron Drive - Full Limit• Azure Mews - Full Limit

- 30 -

ENG 07-19 June 17, 2019


Schedule "7", Stop Signs

Page 3

All stop signs are currently placed on the minor street at all intersections and are listed below. There are no all-way stop locations proposed. The following stop locations have been added, are illustrated in Attachment 1, and are listed in the draft by-law amendment in Attachment 2.

• Jade Street at Usman Road, stop sign on Jade Street• Magenta Road at Usman Drive, stop sign on Magenta Road• Magenta Road at Azure Mews, stop sign on Magenta Road• Saffron Drive at Usman Road (north intersection), stop sign on Saffron Drive• Saffron Drive at Usman Road (south intersection), stop sign on Saffron Drive• Sunflower Road at Saffron Drive (north intersection), stop sign on Sunflower Road• Sunflower Road at Saffron Drive (south intersection), stop sign on Sunflower Road

Schedule "9", Speed Limits and Schedule "1 O", Heavy Traffic Prohibited

Schedule "9", Speed Limits and Schedule 10, Heavy Traffic Prohibited are applicable to all new roads within this development, namely Azure Mews, Usman Road, Magenta Road, Jade Street, Sunflower Road, and Saffron Drive.

Posted speed limit signs for 40 km/h are currently installed on these streets. Signs prohibiting heavy vehicles are currently located on Usman Road at both the north and south intersections with Brock Road as these are the only 2 entrance points into the subdivision, no other signs restricting heavy traffic is required.

The proposed Traffic and Parking By-law 6604/05 Amendment for Schedule "2", Schedule "5", Schedule "6'', Schedule "7", Schedule "9" and Schedule "1 0" is provided in Attachment 2.

Attachments:

1. Area Traffic Controls Kindwin Subdivision2. Draft By-law Amendments to Schedule "2", Schedule "5", Schedule "6'', Schedule "7",

Schedule "9" and Schedule "1 0" to By-law 6604/05.

- 31 -

ENG 07-19


Prepared By: Approved/Endorsed By:

Nathan Emery orn, P.Eng.

June 17, 2019

Page 4

Coordi tor, Traffic Operations Di ctor, Engineering Services .

---:>

ScottB�� Manager, Capital Projects & Infrastructure

NE:mjh


u � 3, 2-01 '7


- 32 -

)

Engineering Services Department

SCALE; PLOT DATE:

NTS May, 2019

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- 33 -


By-law No.

Being a by-law to amend By-law 6604/05 providing for the regulating of traffic and parking, standing and stopping on highways or parts of highways under the jurisdiction of the City of Pickering and on private and municipal property.

Whereas By-law 6604/05, as amended, provides for the regulating of traffic and parking on highways, private property and municipal property within the City of Pickering; and

Whereas, it is deemed expedient to amend Schedule 2, Schedule 5, Schedule 6, Schedule 7, Schedule 9 and Schedule 10 to By-law 6604/05 to provide for the regulation of parking restrictions and stop signs on highways or parts of highways under the jurisdiction of the Corporation of the City of Pickering, specifically to provide for the inclusion of new roads and traffic control into the Traffic and Parking By-law.


1. Schedule 2 to By-law 6604/05, as amended, is hereby further amended theretoby the following:

Column 1

Highway

Add

Azure Mews

Jade Street

Column 2

Side

Both

North

Schedule 2

No Parking

Column 3

Limits (From/To)

Full Limit

Full Limit

Column 4

Prohibited Times or Days

Anytime

Anytime

- 34 -

By-law No.

Column 1

Highway

Add

Jade Street

Magenta Road

Usman Road

Usman Road

Usman Road

ATTACHMENT# o'l-, TO REPORT#�N _:7 o? - IC,::2

Page 2

Column 2

Side

South

North

South

South

East

Schedule 2

No Parking

Column 3

Limits (From/To)

Column 4


Azure Mews to 10 metres Anytime east thereof

Full Limit Anytime

Brock Road (R.R.1) Anytime (north intersection) to Saffron Drive (north intersection)

Brock Road (R. R. 1) Anytime (south intersection) to Saffron Drive (south intersection)

Saffron Drive (north Anytime intersection) to Saffron Drive (south intersection)


Column 1

Highway or Intersection

Add

Azure Mews@ Magenta Road

Column 2

Direction

Schedule 5

Prohibited Turns

Column 3

Turns Prohibited

Northbound Through

Column 4


Anytime

- 35 -

By-law No·.

Column 1

Highway or Intersection

Add

Magenta Road @ Azure Mews

Schedule 5

Prohibited Turns

Column 2

Direction

Westbound

Column 3

Turns Prohibited

Right

Page 3

Column 4


Anytime


Column 1

Highway

Add

Azure Mews

Saffron Drive

Usman Road

Column 2

Schedule 6

Through Highways

Limits (From/To)

Full Limit

Full Limit

Full Limit

- 36 -

ATTACHMENT# d---. "TO REPORT# £Nf) 01- 19

By-law No. _tf_of (£ Page 4


Column 1

Highway

Add

Schedule 7

Stop Signs

Column 2

Compulsory Stop Facing Traffic

Jade Street @ Usman Jade Street, eastbound Road

Magenta Road@ Usman Magenta Road, eastbound Drive

Magenta Road @Azure Magenta Road, westbound Mews

Saffron Drive @ Usman Saffron Drive, westbound Road (north intersection)

Saffron Drive@ Usman Saffron Drive, westbound Road (south intersection)

Sunflower Road@ Saffron Sunflower Road, northbound Drive (north intersection)

Sunflower Road @ Saffron Sunflower Road, southbound Drive (south intersection)

- 37 -

By-law No. Page 5


Column 1

Highway

Add

Azure Mews

Jade Street

Magenta Road

Saffron Drive

Sunflower Road

Usman Road

.Column 2

Limits

Full Limit

Full Limit

Full Limit

Full Limit

Full Limit

Full Limit

Schedule 9

Speed Limits

Column 3

Speed

40 km/h

40 km/h

40 km/h

40 km/h

40 km/h

40 km/h


Column 1

Highway

Add

Azure Mews

Jade Street

Magenta Road

Saffron Drive

Sunflower Road

Usman Street

Schedule 10

Heavy Traffic Prohibited

Column 2

Limits (From/To)

Full Limit

Full Limit

Full Limit

Full Limit

Full Limit

Full Limit

- 38 -

tN'{J o-;;.- I 9 ff==-=��a,

By-law No. Page 6

By-law passed this 24th day of June, 2019.

David Ryan, Mayor


- 39 -

-Cd!J of

p](KER]NG

From: Richard Holborn Director, Engineering Services


Report Number: ENG 08-19 Date: June 17, 2019

Subject: Amendments to Traffic and Parking By-law 6604/05 - Various Locations - File: A-1440

Recommendation:

1. That the attached draft by-law be enacted to amend Schedule "1 ", Schedule "2", Schedule"6", Schedule "7", and Schedule "14", to By-law 6604/05 to provide for the regulation ofstopping and parking on highways or parts of highways under the jurisdiction of theCorporation of the City of Pickering, specifically to provide for stopping restrictions onSheppard Avenue, parking restrictions on Bainbridge Drive, an all-way stop at theintersection of Pine Grove Avenue and Woodview Avenue, and Community Safety Zones onToynevale Road and on Rosebank Road; and


Executive Summary: In response to concerns by Municipal Law Enforcement staff and area residents, and to promote safety around schools, Engineering Services staff are proposing the following updates to Schedule "1", Schedule "2", Schedule "6",Schedule "7", and Schedule "14" to Traffic and Parking By-law 6604/05.

1. Changing the "No Parking" restrictions to "No Stopping" restrictions on the north side ofSheppard Avenue from Whites Road to 150 metres east thereof due to vehicles stopping in the"No Parking" area while waiting for students at Dunbarton High School

2. Implementation of parking restrictions on Bainbridge Drive along the outer curve due todifficulty maneuvering the curve when vehicles are parked along it.

3. Implementation of an all-way stop at the westerly intersection of Pine Grove Avenue andWoodview Avenue due to complaints of increasing traffic volumes, pedestrians crossing andsightlines. The municipal all-way stop warrant has been met for this intersection.

4. Addition of Community Safety Zones near the existing schools on Toynevale Road andRosebank Road in the South Rosebank neighbourhood.

Financial Implications: The installation of all posts and signs can be accommodated within the Roads Current Budget.

- 40 -

ENG 08-19

Subject: Amendment to Traffic and Parking By-law 6604/05 Various Locations

June 17, 2019

Page 2

Discussion: In response to concerns by Municipal Law Enforcement staff and area residents, and to promote safety around schools, Engineering Services staff are proposing the following updates to the Traffic and Parking By-law 6604/05:

Replacement of a No Parking zone with a No Stopping Zone on a portion of Sheppard Avenue is recommended

Municipal Law Enforcement staff contacted Engineering Services staff and requested that a portion of the existing parking restrictions on the north side of Sheppard Avenue east of Whites Road be replaced with stopping restrictions. This was recommended by staff due to many vehicles stopping for pick-up and drop-off of students from Dunbarton High School at this location, which is currently posted as "No Parking" at any time. It is difficult for Municipal Law Enforcement staff to issue tickets for motorists parked but sitting in their vehicle with the engine running in a "No Parking" area.

Engineering Services staff investigated this request and found that vehicles that are stopped on the north side of Sheppard Avenue east of Whites Road create many safety concerns, namely:

• Sightline concerns as this section of road is on a hill and vehicles stop too close to theintersection with Whites Road

• Vehicles travelling westbound (including school buses) have to drive around stopped vehiclesand when there is a queue of vehicles on Sheppard Avenue at the signalized intersection withWhites Road the left turn lane often gets blocked.

After receiving this request from staff, a secondary complaint from a resident in the area was received by Engineering Services through the Customer Care Centre.

Based on the investigation, Engineering Services staff recommend changing the "No Parking" restrictions to "No Stopping" restrictions on the north side of Sheppard Avenue from Whites Road to 150 metres east thereof.

This change will not negatively impact surrounding residents as parking restrictions are already in place and the residences on Sheppard Avenue have long driveways that can accommodate at least four vehicles.

The proposed change from parking restrictions to stopping restrictions are shown graphically in Attachment 1. The draft by-law amendment to Schedule "1", No Stopping, and Schedule "2", No Parking of By-law 6604/05 is presented in Attachment 5.

Staff will continue to monitor this section of road and will bring a recommendation to further extend the stopping restrictions on Sheppard Avenue near Dunbarton High School if required.

- 41 -

ENG 08-19


June 17, 2019

Page 3

Addition of a No Parking Zone on Bainbridge Drive at the curve is recommended

Municipal Law Enforcement staff contacted Engineering Services staff and requested that parking restrictions be placed along the curve on Bainbridge Drive citing difficulty with maneuvering the bend with vehicles parked along this section of road.

Engineering Services staff has previously investigated parking restrictions on Bainbridge Drive, at the request of Durham Region Transit, from Kingston Road south to the curve with a letter being sent to all residents along this section of road back in May 2015. The letter asked for feedback regarding parking restrictions on the east side of the road, from Kingston Road south to the curve. Only 2 residents respond.ed to the survey and they did not feel that this was an issue, specifically stating that residents do not park on the east side of the road, only the west side occasionally, and not around the curve. This information was provided to Durham Region Transit and no further action was taken at that time.

After receiving the new request to investigate this from Municipal Law Enforcement staff, Engineering Services staff conducted numerous site visits at various times of the day and different times of the week, and found that there are vehicles parking along the curve, and on the west side of the road at times. Engineering Services staff also agree with Municipal Law Enforcement staff that the curve can be difficult to maneuver when vehicles are parked on it.

Therefore based on the investigation, Engineering Services staff recommend implementing parking restrictions on Bainbridge Drive along the outer curve. Engineering Services staff will continue to monitor the parking in the area and, if required, will propose parking restrictions along the inner curve if it proves to be problematic in the future.

The proposed addition of parking restrictions are shown graphically in Attachment 2. The draft bylaw amendment to Schedule "2", No Parking of By-law 6604/05 is presented in Attachment 5.

An all-way stop at the westerly intersection of Pine Grove Avenue and Woodview Avenue is recommended

Area residents have requested City of Pickering staff to investigate the installation of an all-way stop control at the westerly intersection of Pine Grove Avenue and Woodview Avenue. Safety concerns have been expressed, specifically in regards to an increase in vehicle traffic, vehicle speed, sightlines at the intersection, and pedestrians crossing the intersection north and south on Pine Grove Avenue.

In response to these concerns, Engineering Services staff completed a review of the westerly intersection at Pine Grove Avenue and Woodview Avenue. City staff's review of the intersection included the following:

• collection of pedestrian and vehicle volumes and completion of municipal all-way stop warrantsat the intersection

• observations of vehicle and pedestrian traffic

• review of existing signs and pavement markings- 42 -

ENG 08-19 June 17, 2019

Subject: Amendment to Traffic and Parking By-law 6604/05 Various Locations Page 4

To determine if an all-way stop control is required at the westerly intersection of Pine Grove Avenue and Woodview Avenue, staff completed municipal all-way stop warrants, in accordance with the City's 2003 Safer Streets Traffic Management Strategy. The City's All-way Stop Warrant calculates whether an all-way stop control is required taking vehicle volumes into consideration.

The City's warrants for all-way stop at the westerly intersection of Pine Grove Avenue and Woodview Avenue were met with Warrant 2: Minimum Vehicle Volume being satisfied. This warrant is a reduced standard approved in the City's 2003 Safer Streets Traffic Management Strategy at 70% of the Provincial All Way Stop Warrant. Sightlines at the intersection were also reviewed, and considered to be acceptable, based on the City's all-way stop warrant requiring a minimum of 60 metres for a roadway with a design speed of 50 km/h (posted 40 km/h).

Engineering Services staff contacted 11 homeowners on May 21, 2019 in the direct vicinity of the intersection that would be the most impacted of the placement of an all-way stop at this location. Out of the 11 residents contacted, 3 were opposed to the installation of the all-way stop.

A letter was sent to residents in the area at the end of May 2019, including the 11 residents that were surveyed on May 21, 2019, giving notification that the recommendation would come before the Executive Committee meeting in June 2019, and if approved would go to the regular Council meeting in June for approval.

It is important to note that Engineering Services staff is not recommending the all-way stop to control speeds, but is recommending the all-way stop because it meets the City's warrant, as described in the 2003 Safer Streets Traffic Management Strategy, based on traffic volumes for an all-way stop. Also, it is recognized that the closest all-way stop to this location is approximately 200 metres away centerline to centerline at the intersection of Pine Grove Avenue and Oakburn Street. This distance is considered acceptable between two all-way stops with one intersection not interfering with the operation of the other intersection.

In summary, based on the results of the vehicle and pedestrian count with the City's All-way Stop Warrant being met, Engineering Services staff recommend the placement of an all-way stop control at the intersection of Pine Grove Avenue and Woodview Avenue.

The proposed all-way stop control at the westerly intersection of Pine Grove Avenue, and Woodview Avenue is shown graphically in Attachment 3. The draft by-law amendment to Schedule "6'', Through Highways, and Schedule "7", Stop Signs of By-law 6604/05 is presented in Attachment 5.

Addition of Community Safety Zones on Toynevale Road and Rosebank Road are recommended

In June of 2018, a review of all schools for the possible implementation of Community Safety Zones was completed by Engineering Services staff. At that time three additional Community Safety Zones were implemented and one was extended. It was noted in the June 2018 report ENG 11-18 that staff would continue to address the need for additional Community Safety Zones, as a tool for addressing traffic safety, and will provide updates to By-law 6604/05 as required.

- 43 -

ENG 08-19 June 17, 2019

Subject: Amendment to Traffic and P�:trking By-law 6604/05 Various Locations Page 5

The purpose of a Community Safety Zone, is to indicate to the motorist that they are within a zone where fines can be increased through a special designation under the Highway Traffic Act. Community Safety Zones are typically placed on sections of roadway where public safety is of special concern.

Based on the June 2018 review, Engineering Services staff recommended that Community Safety Zones be installed on collector and local municipal roads where the following criteria is met:

• where an existing school zone is present

• where, through traffic studies, the 85th percentile speed of vehicles is at least 10 km/h greaterthan the posted speed limit during the school's peak pick-up and drop-off times, or, in an areawhere non-compliance of an existing traffic control is recognized

Based on this criteria, it is recommended that two Community Safety Zones be added to the following two roads.

Road Toynevale Road

Rosebank Road

Limits Rougemount Drive to Rosebank Road

Toynevale Road to Dahlia Crescent/Cowan Circle

Adjacent School Blaisdale Montessori School

Rosebank Road Public School

The South Rosebank Resident Community Group, which makes up this area, has been advised of staff's recommendation to implement Community Safety Zones on these two sections of roads and are supportive of these additions.

The proposed Community Safety Zones on Toynevale Road and Rosebank Road are shown graphically in Attachment 4. The draft by-law amendment to Schedule "14", Community Safety Zones of By-law 6604/05 is presented in Attachment 5.

Attachments:

1. Proposed Stopping Restrictions, Sheppard Avenue2. Proposed Parking Restrictions, Bainbridge Drive3. Proposed All-way Stop Location, Pine Grove Avenue and WoodviewAvenue4. Proposed Community Safety Zones, Toynevale Road and Rosebank Road5. Draft By-law Amendments to Schedule "1 ", Schedule "2", Schedule "6", Schedule "7",

Schedule "14", to By-law 6604/05.

- 44 -

ENG 08-19


Prepared By: Approved/Endorsed By:

1�L/ Nathan mery orn

June 17, 2019

Page 6

Coordi tor, Traffic Operations · ector, Engineering Services

Manager, Capital Projects & Infrastructure

NE:mjh


u �3, zo/7Tony Prevedel, P.Eng. Chief Administrative Officer

c.Si)\ D . I Scott Booker ~

I

I

- 45 -

Legend

ATTACHMENT# __ TO REPORT# Erv fJ O 8 - ( 9

_ __.,_of f

Proposed Stopping Restrictions . . . ■ ■ ■ ■ ■ 1(to replace existing parking restnct1ons)

Existing Stopping Restrictions __ (with days/times)

Existing Parking Restrictions


NTS PLOM;;,

2019

Proposed Stopping Restrictions Sheppard Avenue

-C0Jo/

PJ(KERJNG

- 46 -


NTS May, 2019

ATTACHMENT#._2-_ TO REPORT# _ __.[_of _ _.__

, Proposed 1 Parking Restriction

�f" i

Proposed Parking Restriction Bainbridge Drive

-�-/P1CKERING

EN~ 08- I Cf

- 47 -


PtDTCM.TE:

NTS May, 2019

ATTACHMENT#. __ 3_ 0 REPO # __ £_,-Jf-J O e - ' 9

___ , of ____ _

Proposed All-way Stop

Woodview Avenue and Pine Grove Avenue - Westerly Intersection

-Ci�•J

PlCKERlNG

- 48 -


NTS May, 2019

ATTACHMENT# '-i OREPORT# £rJ<ry DB - IC,

I of __ _

Proposed Community Safety Zones Toynevale Road and Rosebank Road

-u�,/

pJ(l(ERJNG

- 49 -


By-law No.

Being a by-law to amend By-law 6604/05 providing for the regulating of traffic and parking, standing and stopping on highways or parts of highways under the jurisdiction of the City of Pickering and on private and municipal property.

Whereas By-law 6604/05, as amended, provides for the regulating of traffic and parking on highways, private property and municipal property within the City of Pickering; and

Whereas, it is deemed expedient to amend Schedule 1, Schedule 2, Schedule 6, Schedule 7, and Schedule 14 to By-law 6604/05 to provide for the regulation of parking restrictions and stop signs on highways or parts of highways under the jurisdiction of the Corporation of the City of Pickering, specifically to provide for the inclusion of new stopping and parking restrictions, a new all-way stop at the intersection of Pine Grove Avenue and Woodview Avenue and new Community Safety Zones.



Schedule 1

No Stopping

Column 1 Column 2 Column 3 Column 4

Highway Side Limits (From/To) Prohibited Times or Days

Add

Sheppard Avenue North Whites Road (R.R.38) Anytime to 150 metres east thereof

- 50 -

By-law No. Page 2


Schedule 2

No Parking

Column 1 Column 2 Column 3 Column 4

Highway Side Limits (From!To) Prohibited Times or Days

Delete

Sheppard Avenue North Whites Road to Anytime Fairport Road

Add

Bainbridge Drive West and 280 metres south of Anytime South Kingston Road to

350 metres south of Kingston Road

Sheppard Avenue North 150 metres east of Anytime Whites Road (R.R.38) to Fairport Road


Column 1

Highway

Delete

Pine Grove Avenue

Column 2

Schedule 6

Through Highways

Limits (From!To)

The south limit to Oakburn Street, Oakburn Street to Westcreek Drive, Westcreek Drive to Altona Road

- 51 -

By-law No.

Column 1

Highway

Add

Pine Grove Avenue

ATTACHMENT#...2-. ·-oREP , u EI\JG, 06-1 q

Column 2

_...,_3_of S-- Page 3

Schedule 6

Through Highways

Limits (From/To)

The south limit to Woodview Avenue (west intersection), Woodview Avenue (west intersection) to Oakburn Street, Oakburn Street to Westcreek Drive, Westcreek Drive to Altona Road


Column 1

Highway

Add

Pine Grove Avenue@ Woodview Avenue (West intersection)

Schedule 7

Stop Signs

Column 2

Compulsory Stop Facing Traffic

Pine Grove Avenue, eastbound and westbound

_._ i CYO --

- 52 -

By-law No.

ATTACHMENT# S- .. TO REPORT# � N (7 0 8 - I q

Lf of S' Page 4


Column 1

Highway

Add

Rosebank Road

T oynevale Road

Schedule 14

Community Safety Zones

Column 2

Limits (Fromffo)

Toynevale Road to Dahlia Crescent/ Cowan Circle

Rougemount Drive to Rosebank Road

Column 3


Anytime

Anytime

~--

- 53 -

By-law No. Page 5


David Ryan, Mayor


- 54 -

-C�o/

p](KER]NG

From:

Subject:

Kyle Bentley Director, City Development & CBO

Sustainable Pickering Year-in-Review File: D-7300

Recommendation:

1. That Report PLN 15-19 be received for information.


Report Number: PLN 15-19 Date: June 17, 2019

Executive Summary: A Sustainable Pickering Year-in-Review has been created to provide a high level, reader-friendly summary to highlight awards, events, programs and projects. The document promotes the City of Pickering and our partners' effort and serves to inspire others to connect with us and get involved. Going forward, the Year-in-Review will be released annually in the first quarter. The Year-in-Review will be posted online and promoted through social media.

Financial Implications: Not applicable.

1. Discussion

The City of Pickering's award winning sustainability efforts span many areas of interest from energy, pollinators, waste, local food, sustainable development, community engagement, and more. City staff have developed a comprehensive set of tools to communicate these efforts including the website, social media, eNewsletters, events, Measuring Sustainability Report, Pickering 101, and presentations to external groups. In an era when our community members are busier than ever, it is important to utilize a variety of outreach opportunities. The Sustainable Pickering Year-in-Review provides a reader-friendly synopsis of activities a_nd metrics where applicable.

Attachment

1. 2018 Sustainable Pickering Year-in-Review

- 55 -

PLN 15-19

Subject: Sustainable Pickering Year-in:..Review

Prepared By:

Chantal Whitaker, BESc (Hons), CSR-P Supervisor, Sustainability

CW:ld



CORP0227-07/01 revised


(0P4 Kyle Bentley, P. Eng.

June 17, 2019

Page 2

Director, City Development & CBO

- 56 -

2018

pickering.ca/sustainable

Attachment 1 to Report # PLN 15-19

Sustainable Pickering Year-in-Review

- 57 -

Table of Contents

A Message from our CAO ......................................................................................................................................... 1

Awards and Accolades .............................................................................................................................................. 2

Enhancing the natural environment .................................................................................................................. 3

Helping our pollinators ............................................................................................................................................. 4

Engaging with our community .............................................................................................................................. 5

Reducing our waste .................................................................................................................................................... 7

Becoming more energy efficient .......................................................................................................................... 8

Looking towards the future .................................................................................................................................... 9

Year-in-Review

- 58 -

.

A Message from our CAO Page I 1

I am proud to present the City's first Sustainable Pickering, Year-in-Review for 2018. This opportunity allows us to showcase key sustainability highlights and accomplishments from 2018.

Ensuring the long-term social, environmental, economic and cultural health of the City remains a corporate priority, and over time, our sustainability program has evolved to meet the growing needs of our organization and community.

I am proud to say that we are a recognized leader of many award-winning initiatives, and invite you to reflect on our collective achievements, and be inspired on how together, we are forging a path toward a more sustainable future

Tony Prevedel Chief Administrative Officer

Year-in-Review

- 59 -

Awards and Accolades Page 12 ----~~~~~~~-=-------_-_-....:::;:-..:::::---_-_-_-_-_-_--=----=--=--=--=--=--=--=--=--=--=--=-=---=================----__J Smart Commute Gold Designation

The City was awarded the Metrolinx Smart

Commute Gold Workplace Designation for our

efforts in promoting and supporting sustainable

travel options for staff, such as carpooling and

biking to work.

Smart Commute Gold Designation Award

EcoBusiness Network Leadership Award

The City received the Leadership Award from

Ecobusiness Network for its dedication to

environmental leadership and overall impact

reduction within community. The City

demonstrated leadership in sustainability

through various initiatives such as coordinating

the Pickering Farmers' Market, undertaking

natural environment enhancements and other

projects.

Leadership Aw ard from Ecobusiness Network

Named World's Smart21

Communities of 2017 and 2018

Pickering was named a Smart21 Community for

2017 and 2018 by the Intelligent Community

Forum. These awards recognized Pickering's

commitment to creating a more connected,

engaged, inclusive, and sustainable City.

Pickering City Hall

Lighting - Largest Savings Award

The City proudly accepted the 'Lighting -

Largest Savings Award' from Powering Up

Durham. This award recognized a number of

our sustainable initiatives including the

conversion of over 7,000 streetlights to LED, as

well as City facility lighting retrofits.

Largest Savings Award from Powering Up Durham

Year-in-Review

- 60 -

Enhancing the natural environment Page I 3

Take Pride in Pickering Tree Planting

The City of Pickering, in partnership with Ontario

Power Generation, Toronto and Region

Conservation Authority, and Environmental

Stewardship Pickering hosted two tree-planting

events in Duffin Heights and the Waterfront

Trail. 100 attendees joined together to plant 600

trees and pick up litter. Educational and

interactive displays taught residents about the

importance of conservation, biodiversity and

keeping the community clean.

Planting trees in Duffin Heights

Picking up litter in Duffin Heights

20-Minute Pickering Makeover

Over 2,500 people participated in the

14th annual 20-Minute Pickering Makeover to

help beautify the community. Thank you to the

many community groups, schools, businesses

and residents that picked up litter from City

streets and parks.

Lake Ontario Atlantic Salmon Release

The City of Pickering, in partnership with the

Pickering Public Library, Ontario Federation of

Anglers and Hunters and Ontario Ministry of

Natural Resources, supported a salmon

hatchery at the Central Library. Students and

library patrons were able to observe and learn

about the Atlantic salmon and the importance

of biodiversity. The hatchery resulted in the

release of 97 Atlantic salmon into Duffins

Creek.

Atlantic salmon hatchery at Pickering Public Library

Releasing Atlantic salmon into Duffins Creek by the Claremont Nature Centre

Year-in-Review

- 61 -

Helping our pollinators Mayors' Monarch Pledge

As part of the Mayors' Monarch pledge, the City

provided garden training workshops to teach

people how to maintain healthy pollinator

gardens that are designated as Monarch

Waystations. A Monarch exhibit was featured at

both City Hall and the Pickering Museum Village.

The City also helped prepare a butterfly-shaped

garden in Claremont, which is now designated as

a Monarch Waystation through the International

Monarch Waystation Registry.

Pollinator garden training session at Rick Hull Memorial Park

Designated Monarch Waystation at Pickering Museum Village

Page I 4

Whitevale Garden Project

The City assisted the Whitevale Arts and

Culture Centre with expanding a pollinator

garden at their Centre using funds from the

City of Pickering's Community Grant Program

and the Retired Teachers Association Fund.

City staff were able to assist with construction

of the site, selection of plant material, a

landscape plan, and planting. The garden is

now designated as an official Monarch

Waystation.

Local Partnership to Enhance

Pollinator Habitat

Canada Bread Company Limited funded and

planted 300 pollinator-friendly plants in Ernie

L. Stroud Park through its Good Neighbour

program, to help naturalize a previously

mowed area and help local pollinator species.

Dunbarton High school students helped plant

the garden.

Canada Bread Company Limited funds pollinator-friendly planting

Year-in-Review

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Engaging with our community Page Is

Sustainable Pickering Day

The 13th annual Sustainable Pickering Day, in

partnership with the Pickering Town Centre,

brought the community together to raise

awareness about sustainability in Pickering. The

event focused on local food, natural environment,

and gardening. Over 400 visitors shopped the

indoor Farmers' Market, and spoke with experts

on gardening, trees and energy. They also had

the opportunity to recycle unwanted garments

and e-waste.

Toronto and Region Conservation Authority's interactive booth at Sustainable Pickering Day

Attendees speaking to City's energy expert at Sustainable Pickering Day

Environment Day

The City of Pickering, in partnership with Ontario

Power Generation and Toronto and Region

Conservation Authority, celebrated Environment

Day at St. Elizabeth Seton Catholic School. Over

100 students and parents enjoyed an

educational, fun-filled day with nature-related

crafts, an interactive display from Parks Canada,

and the viewing of the award winning film,

'Backyard Wilderness' to end the night.

Pickering Farmers' Market

The Pickering Farmers' Market provided an

opportunity for residents to purchase fresh

produce, baked goods, meats, and handcrafted

jewelry from local farmers and businesses. The

market helped support the local community,

while encouraging healthy and environmentally

friendly foods and goods. Residents enjoyed

weekly live entertainment and themed event

days such as Healthy Living, 55+, and Energy

Awareness, and Mutts at the Market.

Residents buying fresh produce at Pickering Farmers' Market

Year-in-Review

- 63 -

.

Engaging with our community Page I 6

Enhancement project through Celebrating

Sustainable Neighbourhoods program

The Celebrating Sustainable Neighbourhoods

program is about connecting with members of

the community to spark a positive change -

environmentally, socially or economically.

In 2018, SoRo Good Neighbours won the $10,000

community enhancement prize and revitalized

Rick Hull Memorial Park through interpretive

signs, tables, pollinator plantings and trees.

Dunbarton High School won the $3,500 runner

up prize and enhanced Alex Robertson Park and

Ernie L. Stroud Park with interpretive signs about

Shinrin-Yoku and invasive species.

The City was proud to have the Hon. Elizabeth

Dowdeswell, Lieutenant Governor of Ontario

take part in celebrating the outstanding

contributions of its community members

Shinrin-Yoku interpretive sign at Alex Robertson Park

Pickering Blooms Garden Celebration

As part of the City of Pickering Blooms

program, Pickering residents were invited to

celebrate the art of gardening and a season of

beautiful gardens in Pickering. Attendees were

able to learn helpful tips on how to maintain a

healthy garden.

Pickering 101

The Pickering 101 program provided an

opportunity to present the City's sustainability

efforts to participants, highlight opportunities

to get involved, and help build a culture of

community engagement. The program

educated residents on how municipal

government works and gave them an

opportunity to build relationships with City

staff.

Pollinator garden, interpretive sign and reclaimed ash tree bench at Rick Hull Memorial Park

Accessible tables with shade cover at Rick Hull Memorial park Year-in-Review

- 64 -

Reducing our waste Dog Waste Diversion Program

As of 2018, the Dog Waste Diversion Program

was available in 16 parks across Pickering. A total

of 5.2 tonnes of dog waste was collected and

delivered to a facility that converted it into

electricity, heat, and nutrient dense fertilizer.

Dog waste diversion station in Millennium Square

Household Hazardous Waste and

Electronic Waste Collection

During the 2018 collection event, in partnership

with the Region of Durham, Pickering residents

dropped off 10.49 tonnes of electronic and

hazardous waste, free of charge. Residents were

also able to drop off non-perishable food items

for the local food bank.

Page I 7

Compost Giveaway

In partnership with the Region of Durham,

Pickering hosted its annual compost giveaway.

At this popular event, 1,100 residents were able

to pick-up free compost made from the

organics collected through Durham's curbside

green bin and yard waste programs.

Battery Recycling Program

This program allows residents to drop off their

batteries at the Pickering Recreation Complex,

Pickering Central Library, George Ashe and

East Shore Community Centres. The batteries

are stored and then picked up to be responsibly

recycled.

Batteries collected at Pickering Recreation Complex

Milk Bag recycling program

Pickering's staff-driven Milk Bag program

collects clean milk bags from Pickering staff for

delivery to local community groups that collect,

weave, and send completed bed mats to

poverty-stricken areas throughout the world.

Year-in-Review

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Becoming more energy efficient Page I 8

Street Light Conversion to LED

The City of Pickering converted over 7,000

streetlights to Light Emitting Diode (LED)

lighting, through its light conversion project.

The new street lights consume less energy, have

a longer lifetime, and offer increased safety. A

$642,282.35 cheque was presented to the City

from Veridian as part of the Save on Energy

Rebate program. The City will also save

$690,000 per year in combined electricity and

maintenance costs.

LED streetlights initiative

Encouraging Residential Participation

The City's energy conservation initiatives align

with its' Corporate Energy Management Plan.

Actions have resulted in financial savings, as

well as a reduction in greenhouse gas emissions.

However, upon learning of the limited

residential participation in the utilities' energy

and money saving programs, the City partnered

to develop and implement a comprehensive

promotional strategy to increase awareness to

households, including low-income.

Energy Retrofit Projects

As part of Pickering's commitment to energy

efficiency, LED lighting retrofits were completed

in three Pickering facilities: Pickering Recreation

Complex, Pickering City Hall, and the Eastshore

Community Centre. The Pickering Recreation

Complex also added building automation systems

and upgraded their boilers to help save energy.

New Electric Vehicles & Charging

Stations

The City added two electric vehicles to our fleet

as well as four electric vehicle charging stations.

Benefits of the new electric vehicles include

improved air quality, cost savings, low

maintenance, and reduced greenhouse gas

emissions.

Electric vehicle charging stations

City of Pickering electric vehicle at charging station

Year-in-Review

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Looking towards the future Page I 9

Measuring progress towards sustainability

The Measuring Sustainability Report updated

statistics on key indicators of sustainability in the

City. A total of 52 indicators were grouped into

five categories of Healthy Environment, Healthy

Economy, Healthy Society, Responsible

Development, and Responsible Consumption.

These measurements help drive future progress

in meeting our evolving sustainability objectives.

Durham Community

Climate Adaptation Plan

Pickering joined in the development of the

Durham Community Climate Adaptation Plan to

help Durham Region identify the impacts of

climate change and how these changes relate to

the vulnerability of specific areas in the region.

The Region of Durham, local municipalities, and

other organizations are now participating in

program implementation.

Sustainable~ PICKERING

- C/fl'i

p](KER]NG

Measuring Sustainability Report

Durham Community Energy Plan

Pickering participated in the development of a

Durham Community Energy plan. The plan

strives to improve energy efficiency, reduce

energy use and greenhouse gas emissions,

while encouraging green energy solutions at

the local level. This will establish groundwork

for future growth and development, energy

generation, delivery and use. The plan is

expected to be complete in late 2019.

In 2019, the City of Pickering will continue its longstanding commitment to create a more sustainable community. Join us on the journey to become one of the most sustainable cities in Canada. There are many fun and inspiring ways to make Pickering a better place environmentally, socially and economically. To learn how you can get involved visit: pickering.ca/sustainable

Year-in-Review

- 67 -

https://www.pickering.ca/en/sustainability.aspx

We welcome your comments, questions, and suggestions. Please contact the City's Sustainability staff at

[email protected].

Alternate formats available upon request at 905.683.7575 or [email protected].

Year-in-Review

- 68 -

mailto:[email protected]

mailto:[email protected]

--Ci�o/-

p](KERJNG

From: Stan Karwowski Director, Finance & Treasurer

Subject: 2018 Year End

Recommendation:

Report to

Executive Committee Report Number: FIN 08-19

Date: June 17,2019

1. That the Report to the Executive Committee on the 2018 audit as submitted byDeloitte LLP (Deloitte) be received for information;

2. That the 2018 draft Audited Consolidated Financial Statements for the City ofPickering be approved; and

3. That Deloitte LLP be reappointed to provide external auditing services to the Cityof Pickering for a 3 year term.

Executive Summary: Attached to this report is the auditor's Report to Executive Committee on the 2018 audit and the draft Audited Consolidated Financial Statements for the year ended December 31, 2018. The auditor has provided an unmodified audit report on the financial statements. This means that the financial statements present fairly, in all material respects, the financial position of the City and its operations, changes in its net financial assets and its cash flows in accordance with Canadian public sector accounting standards. The auditor did not identify any significant deficiencies during the audit to formally report to Council.

Under section 296 of the Municipal Act, 2001, Council must appoint an auditor, licensed under the Public Accounting Act, 2004, for a period not to exceed 5 years. The current auditor, Deloitte, was last appointed in 2016 for a 3 year term. As the term ends with the 2018 year end audit, it is recommended the firm be reappointed for a 3 year term.

Financial Implications: The Balance Sheet has net financial assets increasing by approximately $2.1 million which means that the City is capable of meeting its financial commitments. The accumulated surplus increased by $21.6 million over prior year primarily due to an increase in the net book value for tangible capital assets. Again this year, total expenditures came in under budget as staff continue to maintain tight control over their operating budgets.

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FIN 08-19


June 17, 2019

Page 2

The revenues reported in the Consolidated Statement of Operations are the combined revenues for operating and capital purposes. As a result, variances between budget and actual may arise due to the timing of approval in the capital budget as compared to the actual receipt of funds/recognition of revenue.

Overall, the City's financial position is healthy and strong and the City is able to meet its financial commitments.

In regards to the reappointment of the auditors, there will be no additional costs beyond the budgeted amount included in the 2019 Current Budget as the auditor has indicated they would be willing to hold their audit fees at the 2018 level for the 3 year term.

Discussion: The audit of the consolidated financial statements for the year ended December 31, 2018 has been completed. The auditor's Report to Executive Committee is included as Attachment 1. This Report, prepared by Deloitte, summarizes its findings from the December 31, 2018 audit and comments on significant matters regarding the audit.

Appendix 1 provides a summary of communication requirements which Deloitte is required to bring to Council's attention. The independence letter in Appendix 2 confirms that Deloitte is independent from the City. Appendix 3 is the draft management representation letter which is provided by the City to the auditors. This letter indicates that the financial statements are management's respo!lsibility and that management has provided and disclosed all necessary information to ensure that the financial statements are not materially misstated. This letter will be signed by the appropriate authorities upon approval of the financial statements.

The scope of the audit does not include an in-depth evaluation of all systems or internal controls, however, the auditors may report on matters that come to their attention during the course of their review. No significant matters came to their attention to report and therefore a management letter has not been issued. During the course of any audit, auditors may find misstatements that may or may not be adjusted due to materiality. For 2018, there is an uncorrected misstatement related to the overstatement of the amortization expense. As part of the implementation of asset management, some of the useful life estimates for tangible capital assets were identified to be adjusted. For example, the vehicles' useful life was adjusted from 5 to 7 years to better reflect the City's actual retention period. This has been an ongoing process and as at December 31, 2018 there are still a few asset categories remaining to be completed which resulted in an overstatement of the amortization expense.

The draft Audited Consolidated Financial Statements are included as Attachment 2. These statements are the responsibility of management and have been prepared by City accounting staff under the direction of the Director, Finance & Treasurer. The auditors are responsible to express an opinion on these Consolidated Financial Statements based on their audit. An unmodified audit report has been issued which means the auditors have indicated that in their opinion, the consolidated financial

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FIN 08-19


June 17, 2019

Page 3

statements are fairly presented, in all material respects. In other words the City has a clean report. The Consolidated Financial Statements include the activities of the City of Pickering Public Library Board. The City's investment in Veridian Corporation is accounted for on a modified equity basis, which means the City includes its share of Veridian's income or loss in the Consolidated Financial Statements.

The Consolidated Financial Statements are prepared on the full accrual basis in accordance with Canadian Public Sector Accounting Standards (PSAS), which includes reporting tangible capital assets. Tangible capital assets, such as land, building, infrastructure and equipment are capitalized (recorded) at cost on the Statement of Financial Position (Balance Sheet) and amortized (depreciated, except for land) over their estimated useful lives in current operating expenses. The Statement of Financial Position includes tangible capital assets under the non-financial asset section and shows in Accumulated Surplus. This is different than the City's budget, which notes these capital items as expenditures.

Statement of Financial Position (Balance Sheet)

Financial assets are those assets which could provide resources to discharge existing liabilities or finance future operations. The City's financial assets increased by approximately $15.9 million which is offset by an increase in liabilities of $13.8 million. This resulted in an increase in net financial assets of $2.1 million over the prior year which means the City is able to meet its financial commitments.

Non-financial assets include tangible capital assets which is the net book value (cost less accumulated amortization) of City-owned assets including land, buildings, roads, bridges and sidewalks infrastructure, storm sewer infrastructure, furniture and fixtures, vehicles and equipment. Non-financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations. Note 10 of the Financial Statements provide a summary of the City's tangible capital assets. The December 31, 2018 gross book value of assets is $492.6 million and, after adjusting for amortization, the net book value of the assets is $259.9 million. In other words, the City has consumed a substantial amount of the life of its assets. Future capital budgets have taken into consideration the investment into and the maintenanc� of the City's infrastructure base as a financial priority.

Statement of Operations (Income Statement)

Revenue reported includes both operating and capital. Therefore, variances between budget and actual may arise due to the timing of approval in the capital budget as compared to the actual receipt of funds/recognition of revenue. This is clearly illustrated with development charges and contributions earned line item.

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FIN 08-19


June 17, 2019

Page 4

The budget amount primarily represents development charge (DC) funding of 2018 capital projects. The actual amounts reported reflect DC funding for capital projects approved in prior year budgets because of the timing difference between when a project is approved in the budget and when it actually commences.

Actual expenses are under budget in most of the functional areas, which illustrates City staff's commitment to controlling expenditures. However the General Government line shows a significant underage as a result of the timing of budget to actual for the new Financial System. The budget approval was received in 2018 however the implementation is occurring in 2019.

The capital budget expenditures do not show on the Statement of Operations as capital expenditures. For those expenditures that meet the definition of a tangible capital asset (TCA), the cost is reported on the Statement of Financial Position (Balance Sheet). Only a portion of the asset's cost is included as an amortization expense each year over the life of the asset in the operating expenses reported on the Statement of Operations. The amortization expense is included in operating expenses for the asset's respective functional category. For example, amortization on a fire truck is included under the Protection to Persons and Property category. Capital budget expenditures that do not meet the TCA definition are included as operating expenses under the appropriate functional category.

The budget figures reported need to reflect the change in reporting for capital budget expenditures to be compliant with Public Sector Accounting Standards. Note 18 of the City's consolidated financial statements reflect the changes made to the 2018 Council approved budget to put it on a basis consistent with the full accrual basis of accounting. This means excluding capital expenditures that are deemed tangible capital assets and including amortization.

Accumulated Surplus

The components that make up the Accumulated Surplus are disclosed in Note 11 of the City's consolidated financial statements and are summarized below. An accumulated surplus is the amount by which all assets (financial and physical) exceed all liabilities. It must be emphasized that these amounts are not surplus funds in the traditional sense. In other words, there is no City bank account that has a balance of $403.3 million. An accumulated surplus indicates that the City has net resources (financial and physical) that can be used to provide future services. What primarily contributes to this balance are the net tangible capital assets of approximately $259.9 million and the City's equity in Veridian Corporation of approximately $84.6 million.

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FIN 08-19


The accumulated surplus is comprised of the following:

Operating fund Capital fund Reserves and reserve funds Equity in Veridian Corporation Tangible capital assets Note Receivable Post employment benefits liability WSIB benefit liabilities Internal loans Net long-term liabilities

Reappointment of Auditors

2018

$ 125,247 20,701,530 73,871,965 84,628,856

259,879,354 3,530,086

(6,081,194) (1,917,179) (1,986,799)

(29,418,973) $403,332,893

2017

$ 125,237 25,169,415 73,136,645 81,505,144

240,256,987 3,796,946

(5,430,656) (1,862,876) (3,595,241)

(31,412,982) $381,688,619

June 17, 2019

Page 5

Deloitte was last appointed to conduct the statutory audits for the 2016 to 2018 fiscal years. Experience in the public sector, specifically municipalities, range of other services available and knowledge of the client are important considerations for appointment of an auditor. Deloitte is one of the largest public accounting firms in Canada and has vast experience within the municipal sector. They provide a variety of _auditing, accounting and advisory services to a number of municipalities including 6 of the 8 local municipalities and the Regional Municipality of Durham. The services provided by Deloitte have clearly demonstrated proficiency in the municipal environment, particularly Public Sector Accounting Board (PSAB) standards and guidelines. Their comments and assistance is always relevant and practical. Based on experience to date, the firm has provided an excellent level of service at a reasonable cost. Deloitte has agreed to hold their fee at the 2018 level for the full 3 year term. Staff is recommending that Deloitte be reappointed for a 3 year term.

Attachments:

1. Auditor's Report to Executive Committee on the 2018 Audit2. 2018 Draft Audited Consolidated Financial Statements

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FIN 08-19


Prepared By:

Kristine Senior, CPA, CA Manager, Accounting Services



June 17, 2019

Page 6


Stan Karwowski, MBA, CPA, Director, Finance & Treasurer

- 74 -

Deloitte.

I I

F The Corporation of the City of Pickering

Report to the Executive Committee on the 2018 Audit June 17, 2019

- 75 -

Deloitte.

May 29, 2019

Private and confidential

To the Members of Executive Committee


1 The Esplanade

Pickering ON Ll V 6K7

Report on audited annual financial statements

Dear Executive Committee Members:

Deloitte LLP 400 Applewood Crescent Suite 500 Vaughan ON L4K 0C3 Canada

Tel: 416-601-6150 Fax: 416-601-6151 www .deloitte.ca

We are pleased to submit this report on the results of our audit of the consolidated financial statements of the City of Pickering (the "City") and the financial statements of related City entities for the 2018 fiscal year. This report summarizes the scope of our audits, our findings and reviews certain other matters that we believe to be of interest to you.

We expect to issue our Independent Auditor's Reports on the financial statements of the City, the City of Pickering Library Board (the "Library") and the City of Pickering Trust Funds (The "Trust Funds"), upon approval of the financial statements. Our audits were conducted in accordance with the Audit service plan dated September 11, 2018.

This report is intended solely for the information and use of the Executive Committee, management, and others within the City and is not intended to, and should not be, used by anyone other than these specified parties. Accordingly, we disclaim any responsibility to any other party who may rely on it.

We would like to express our appreciation for the cooperation we received from management and the employees of the City with whom we worked to discharge our responsibilities. We look forward to discussing this report summarizing the outcome of our audit with you and to answering any questions which you may have.

Yours truly,

Chartered Professional Accountants Licensed Public Accountants

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The Corporation of the City of Pickering I Table of contents

Table of contents

Our audits explained

Areas of audit risk

Significant accounting practices, judgments and estimates

Other reportable matters

Appendix 1 - Communication requirements

Appendix 2 - Independence letter

Appendix 3 - Draft management representation letter

1

4

6

8

9

11

13

© Deloitte LLP and affiliated entities.

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The Corporation of the City of Pickering I Our audits explained

Our. audits explained

This report summarizes the main findings arising from our audits.

1

Audit scope and terms of engagement

We were engaged to perform the audits of the City's, Library's, and Trust Fund's Financial Statements as at, and for the year ended, December 31, 2018 (the "Financial Statements") prepared in accordance with Canadian Public Sector Accounting Standards ("PSAS") for the City and the Library Board and Canadian Accounting Standards for Not-For-Profit Organizations for the Trust Funds. Our audits were conducted in accordance with Canadian Generally Accepted Auditing Standards ("Canadian GAAS").

The terms and conditions of our engagement are described in the Master Services Agreement dated October 28, 2016 and confirmation of changes letter dated August 23, 2018.

Scope and terms of engagement Materiality

Materiality

Audit risks

Through our risk assessment process, we have identified the audit risks. These areas of risk of material misstatement and our related audit responses are described in the 'Areas of audit risk' section of this report.

Audit risks

We are responsible for providing reasonable assurance that your financial statements as a whole are free from material misstatement.

Our materiality was determined as follows:

• Consolidated financial statements for the City - approximately 3% of expenses,

• City of Pickering Public Library Board - approximately 3% of expenses, and

• City of Pickering Trust Funds - approximately 3% of fund balances.

We agreed to inform you of any uncorrected misstatements detected during the audit which were greater than a clearly trivial amount of 5% of materiality and any misstatements that are, in our judgment, qualitatively material. In accordance with Canadian GAAS, we asked that any misstatements be corrected.


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2

Status and outstanding matters Uncorrected misstatements

We expect to be in a position to render our Independent Auditor's Reports on the financial statements of the City, the Library Board, and the Trust Funds following their approval, and the completion of the following procedures:

The only misstatement aggregated by us during the current year's audit results from revised estimates related to the useful lives of tangible capital assets. Some capital assets' useful lives were updated, however, some asset classes still made use of old useful life estimates in the determination of current year amortization. This is consistent with our finding in the prior year and the continuation of management's efforts towards updating useful lives of all tangible capital assets. This has resulted in an overstatement of amortization expense and understatement of the net book value of tangible capital assets by approximately $920,133 in the current year ($1.27 million in the prior year).

• Receipt of signed management representations letters

• Receipt of legal responses, and

• Update of our subsequent events procedures.

Status and outstanding matters

Going concern

Going concern

Management has completed its assessment of the ability of the City, the Library Board and the Trust Funds to continue as a going concern and in making its assessment did not identify any material uncertainties related to events or conditions that may cast significant doubt upon the City's, the Library Board's or the Trust Funds' ability to continue as a going concern. We agree with management's assessment.

Internal controls Uncorrected

misstatements Uncorrected disclosure

misstatements

Internal controls

During the course of our audits, we examined certain of the accounting procedures and internal controls related to the financial reporting processes at the City and the Library Board. As a result of this examination, we did not identify any significant deficiencies in internal control.

Uncorrected disclosure misstatements

In accordance with Canadian GAAS, we request that all disclosure misstatements be corrected. There are no significant disclosure misstatements aggregated by us during the current engagement and pertaining to the latest period presented to report.


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3

Fraud risk

A summary of the results of our audit procedures designed to address the risk of material misstatement in the financial statements relating to fraud is provided in the 'Areas of audit risk' section of this report.

Fraud risk Significant accounting

practices, judgments and estimates

Significant accounting practices, judgments and estimates

Accounting estimates are an integral part of the financial statements prepared by management and are based on management's current judgments. These judgments are normally based on knowledge and experience about past and current events, assumptions about future events and interpretations of the financial reporting standards.

See pages 6 and 7 for further details.

Independence

We have developed appropriate safeguards and procedures to eliminate threats to our independence or to reduce them to an acceptable level. We confirm that we have complied with relevant ethical requirements regarding independence. Our annual independence letter is included in Appendix 2.

Independence Conclusion

Conclusion

In accordance with Canadian GAAS, our audits were designed to enable us to express an opinion on the fairness of the presentation of the financial statements prepared in accordance with Canadian Public Sector Accounting Standards ("PSAS") for the City and the Library Board and Canadian Accounting Standards for Not-For-Profit Organizations for the Trust Funds.

No restrictions have been placed on the scope of our audits. In performing the audits, we were given full and complete access to the accounting records, supporting documentation and other information requested.

We expect to issue unmodified Independent Auditor's Reports on the financial statements of the City, Library Board and Trust Funds for the year ended December 31, 2018 once the outstanding items, referred to previously in this report, are completed satisfactorily and the financial statements are approved.


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The Corporation of the City of Pickering I Areas of audit risk

Areas of audit risk

Revenue recognition*

Audit risk

Canadian GAAS includes the presumption of a fraud risk involving improper revenue recognition. (Revenue/deferred revenue).

Management override of controls*

Audit risk

Under Canadian GAAS, it is the responsibility of the management, with the oversight of those charged with governance, to place a strong emphasis on fraud prevention and detection. Oversight by those charged with governance includes considering the potential for override of controls or other inappropriate influence over the financial reporting process.

Management override of controls is present in all entities. It is a risk of material misstatement resulting from fraud and therefore is considered as a significant risk.

Our audit response

• Certain revenue streams are a presumed area of audit risk. Wetested the design and implementation of controls in theserevenue streams and performed substantive analytic proceduresand detailed testing in these areas, and

• Substantive testing to determine if restricted contributions (i.e.,development charges), and government transfers had beenrecognized as revenue in the appropriate period. (Revenue vs.deferred revenue).

Our audit response

• Engaged in periodic fraud discussions with certain members ofsenior management and others

• Considered the potential for bias in judgments and estimates,including performing retrospective analysis of significantaccounting estimates

• Evaluated the business rationale for any significant unusualtransactions

• Evaluated the City's fraud risk assessment and consider entitylevel internal controls and internal controls over the closing andreporting process, and

• Tested journal entries that exhibit characteristics of possiblemanagement override of controls

*These areas were identified as areas of significant risk, as required by Canadian Auditing Standards.

4

Audit results

We obtained sufficient audit evidence in this area and are satisfied with the results of audit procedures performed.

Audit results

Our procedures did not indicate any evidence of management override of controls.


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The Corporation of the City of Pickering I Areas of audit risk

Proposed merger of Veridian Corporation and

Whitby Hydro Energy Corporation

Audit risk

The shareholders of Veridian Corporation and Whitby Hydro Energy Corporation have approved a merger. There is a risk that the status of the merger and the impact is not appropriately disclosed or accounted for in the financial statements.

5

Our audit response

• Engage in regular discussions with management to remainabreast of merger status

• Review merger agreements, if any, and monitor approvalprocess by the Ontario Energy Board, to ensure disclosures inthe financial statements are appropriate and adequate

Audit results

We noted that the merger was finalized on April 1, 2019 and Veridian Corporation officially amalgamated with Whitby Hydro Energy Corporation to form Elexicon Corporation. This subsequent event has been disclosed in Note 4(f) to the financial statements.


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The Corporation of the City of Pickering I Significant accounting practices, judgments and estimates

Significant accounting practices, judgments

and estimates

The accounting policies of the City, the Library Board and the Trust Funds are set out in Note 1 of their respective financial statements.

In the course of our audits of the financial statements, we considered the qualitative aspects of the financial reporting process, including items that have a significant impact on the relevance, reliability, comparability and understandability of the information included in the financial statements.

Significant accounting policies In the current year, the City adopted the following accounting standards:

• PS 2200 Related party disclosures

• PS 3210 Assets

• PS 3320 Contingent assets

• PS 3380 Contractual rights

• PS 3420 Inter-entity transactions

The adoption of these standards had no impact on the financial statements.

There were no other changes to previously adopted accounting policies or their application at the City, the Library Board or the Trust Funds.

In our judgment, the significant accounting practices and policies, selected and applied by management are, in all material respects, acceptable under PSAS for the City and the Library Board, under Accounting Standards for Not For Profit Organizations for the Trust Funds and are appropriate

to the particular circumstances of the City, the Library Board and the Trust Funds.

Management judgment and accounting estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management's current judgments. These judgments are normally based on knowledge and experience about past and current events, assumptions about future events and interpretations of the financial reporting standards.

6 © Deloitte LLP and affiliated entities.

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The Corporation of the City of Pickering I Significant accounting practices, judgments and estimates

During fiscal 2017, management completed a preliminary draft capital management plan (CMP), resulting in the adjustment of useful lives for many tangible capital assets. At that time, management updated the useful lives for many of its tangible capital assets to reflect the best estimate of useful lives at the time; however, this had not been updated for all tangible capital assets in the City's subledger, which resulted in an uncorrected misstatement of $1.27 million for the fiscal 2017 audit. In the current year, management made progress towards the update of useful lives; however, some assets were still amortized based on legacy useful life information. The impact of this is an uncorrected misstatement of $920,133 as reflected in page 2 of this report.

There were no other significant changes in accounting estimates or in judgments relating to the application of the accounting policies.

In our judgment, the significant accounting estimates made by management (with assistance from the City's actuary as appropriate) are, in all material respects, free of possible management bias and of material misstatement. The disclosure in the consolidated financial statements with respect to estimation uncertainty is in accordance with PSAS and is appropriate to the particular circumstances of the City.

Significant estimates include:

2018 2017

Post-employment benefits liability $6,260,194 $5,609,656

WSIB benefits liability $1,917,179 $1,862,876

Allowance for doubtful accounts $5,000 $5,000

Provision for property tax assessment appeals $1,330,418 $743,671


- 84 -

The Corporation of the City of Pickering I Other reportable matters

Other reportable matters

The following summarizes the status and findings of key aspects of our audits. In the appendices to this report, we have provided additional

information related to certain matters we committed to report as part of the audit service plan.

Changes to the audit service plan

Significant difficulties encountered in performing the audit

Related party transactions

Disagreements with mana_gement

Consultation with other accountants

Legal and regulatory compliance

Subsequent events

8

Comment

The audits were conducted in accordance with our Audit service plan, which was communicated to the Executive Committee. We confirm that there have been no significant amendments to the audit scope and approach communicated in our Audit service plan.

We did not encounter any significant difficulties while performing the audits. There were no significant delays in receiving information from management required for the audits nor was there an unnecessarily brief timetable in which to complete the audits.

Related party transactions or balances have been properly disclosed in the financial statements.

We have not identified any related party transactions that were not in the normal course of operations and that involved significant judgments by management concerning measurement or disclosure.

During the course of our audits, we did not have any disagreements with management about matters that individually or in the aggregate could be significant to the financial statements.

Management has informed us that the City and the Library Board have not consulted with other accountants about auditing or accounting matters.

Management is responsible for ensuring that the City's operations are conducted in accordance with the laws and regulations applicable to the City. The responsibility for preventing and detecting non-compliance rests with management. The auditor is not and cannot be held responsible for preventing non-compliance with laws and regulations

Our limited procedures did not identify any areas of material non-compliance with laws and regulations by the City, the Library Board and the Trust Funds.

At the date of finalizing this report, other than the merger of Veridian Corporation and Whitby Hydro Energy Corporation disclosed in Note 4 to the City's financial statements, we are not aware of any significant subsequent events that would require adjustment or disclosure in the financial statements at December 31, 2018.


- 85 -

The Corporation of the City of Pickering I Appendix 1 - Communication requirements

Appendix 1 - Communication requirements

The table below summarizes our communication requirements under Canadian GAAS.

Required communication

Audit service plan

1. Our responsibilities under Canadian GAAS, including forming and expressing an opinion on the financialstatements

2. An overview of the overall audit strategy, addressing:

a. Timing of the audit

b. Significant risks, including fraud risks, and

c. Planned responsibilities of other independent public accounting firms or others that perform auditprocedures in the audit.

3. Significant transactions outside of the normal course of business, including related party transactions

Enquiries of those charged with governance

4. How those charged with governance exercise oversight over management's process for identifying andresponding to the risk of fraud and the internal control that management has established to mitigatethese risks

5. Any known suspected or alleged fraud affecting the City

6. Whether the City is in compliance with laws and regulations

Year end communication

7. Fraud or possible fraud identified through the audit process

Comments

Master Services Agreement dated October 28, 2016 and confirmation of changes letter dated August 23, 2018

Audit service plan presented to the Executive Committee on September 11, 2018

We received the reporting requested from the independent auditor of Veridian Corporation

Note 4 - Veridian Corporation

Covered when presenting the Audit service plan

None noted

Refer to 'Other reportable matters' section of this report

None noted

8. Significant accounting policies, practices, unusual transactions, and our related conclusions See pages 6 and 7

9. Alternative treatments for accounting policies and practices that have been discussed with management Nothing of significance during the current audit period

10. Matters related to going concern None noted


- 86 -

The Corporation of the City of Pickering I Appendix 1 - Communication requirements

Required communication

11. Management judgments and accounting estimates

12. Significant difficulties, if any, encountered during the audit

13. Material written communications between management and us, including management representationletters

14. Other matters that are significant to the oversight of the financial reporting process

15. Modifications to our Independent Auditor's Reports.

16. Our views of significant accounting or auditing matters for which management consulted with otheraccountants and about which we have concerns

17. Significant matters discussed with management

18. Illegal or possible illegal acts that come to our attention

19. Significant deficiencies in internal control, if any, identified by us in the conduct of the audit of thefinancial statements

20. Uncorrected misstatements and disclosure items

21. Any significant matters arising during the audit in connection with the City's related parties

10

Comments

See pages 6 and 7

None

Management representation letter is attached in Appendix 3

None

None

We are not aware of any such consultations

None

None noted

No significant deficiencies noted

See page 2 for uncorrected misstatement

None noted

© Deloitte LLF' and affiliated entities.

- 87 -

The Corporation of the City of Pickering I Appendix 2 - Independence letter

Appendix 2

Deloitte.

May 21, 2019

Private and confidential

The Members of the Executive Committee The Corporation of the City of Pickering 1 The Esplanade Pickering ON Ll V 6K7

Dear Executive Committee Members,

Independence letter

Deloitte LLP 400 Applewood Crescent Suite 500 Vaughan ON L4K 0C3 Canada

Tel: 416-601-6150 Fax: 416-601-6151 www.deloitte.ca

We have been engaged to audit the consolidated financial statements of The Corporation of the City of Pickering (the "City") for the year ended December 31, 2018.

You have requested that we communicate in writing with you regarding our compliance with relevant ethical requirements regarding independence as well as all relationships and other matters between the City, our Firm and network firms that, in our professional judgment, may reasonably be thought to bear on our independence. You have also requested us to communicate the related safeguards that have been applied to eliminate identified threats to independence or reduce them to an acceptable level.

In determining which relationships to report, we have considered relevant rules and related interpretations prescribed by the appropriate provincial regulator/ordre and applicable legislation, covering such matters as:

a. Holding a financial interest, either directly or indirectly, in a client.

b. Holding a position, either directly or indirectly, that gives the right or responsibility to exert significant influence over the financial or accountingpolicies of a client.

c. Personal or business relationships of immediate family, close relatives, partners or retired partners, either directly or indirectly, with a client.


- 88 -

The Corporation of the City of Pickering I Appendix 2 - Independence letter

d. Economic dependence on a client.

e. Provision of services in addition to the audit engagement.

We confirm to you that the engagement team and others in the firm as appropriate, the firm and, when applicable, network firms have complied

with relevant ethical requirements regarding independence.

We have prepared the following comments to facilitate our discussion with you regarding independence matters arising since May 30, 2018, the date

of our last letter.

We are not aware of any relationships between the Deloitte Entities and the City and its affiliates, or persons in financial reporting oversight roles at

the City and its affiliates, that, in our professional judgment, may reasonably be thought to bear on independence, that have occurred from May 30,

2018 to May 21, 2019.

We hereby confirm that we are independent with re?pect to the City in accordance with the Rules of Professional Conduct of the Chartered

Professional Accountants of Ontario as of May 21, 2019.

This letter is intended solely for the information and use of the Executive Committee, management, and others within the City and is not intended to

be and should not be used for any other purposes.

Yours truly,

Chartered Professional Accountants

Licensed Public Accountants


- 89 -

The Corporation of the City of Pickering I Appendix 3 - Draft management representation letter

Appendix 3 - Draft management representation letter

June 17, 2019

Deloitte LLP

400 Applewood Crescent

Suite 500

Vaughan ON L4K 0C3

Subject: Consolidated financial statements of The Corporation o · · kering for the year ended December 31, 2018

Dear Ms. Colavecchia:

This representation letter is provided in connection wit

Corporation of the City of Pickering (the "City" or "

policies and other explanatory information (the "

Statements present fairly, in all material respe:

Sector Accounting Standards ("PSAS").

We confirm that, to the best of our knowledge and b

informing ourselves:

Financial statements

eloitte LLP ("Deloitte" or "you") of the consolidated financial statements of The

ar ended December 31, 2018, and a summary of significant accounting

the purpose of expressing an opinion as to whether the Financial

ition, results of operations, and cash flows of the City in accordance with Public

made such inquiries as we considered necessary for the purpose of appropriately

1. We have fulfilled our responsibilities as set out in the terms of the engagement letter between the City and Deloitte dated October 28, 2016 and

subsequent confirmation of changes letter dated August 23, 2018 for the preparation of the Financial Statements in accordance with PSAS. In

particular, the Financial Statements are fairly presented, in all material respects, and present the financial position of the City as at

December 31, 2018 and the results of its operations and cash flows for the year then ended in accordance with PSAS.

2. Significant assumptions used in making estimates, including those measured at fair value, are reasonable.

13

In preparing the Financial Statements in accordance with PSAS, management makes judgments and assumptions about the future and uses

estimates. The completeness and appropriateness of the disclosures related to estimates are in accordance with PSAS. The City has


- 90 -


appropriately disclosed in the Financial Statements the nature of measurement uncertainties that are material, including all estimates where it is reasonably possible that the estimate will change in the near term and the effect of the change could be material to the Financial Statements.

The measurement methods, including the related assumptions and models, used in determining the estimates, including fair value, were appropriate, reasonable and consistently applied in accordance with PSAS and appropriately reflect management's intent and ability to carry out specific courses of action on behalf of the entity. No events have occurred subsequent to December 31, 2018 that require adjustment to the estimates and disclosures included in the Financial Statements.

There are no changes in management's method of determining significant estimat_

3. The City has identified all related parties in accordance with Section PS 220appropriate disclosures with respect to its related party transactions in accofactors, including those listed in paragraph 16 of PS 2200.

4. We have determined that the Financial Statements are complete as of the daFinancial Statements (including disclosures) planned or expected. The Fto finalize financial statements.

5. We have completed our review of events after December 31, 2018Financial Statements and for which PSAS requires adjustmentdisclosures included in the Financial Statements that are impa.

6.

Disclosures ("PS 2200"). Management has made the his assessment is based on all relevant

letter as this is the date when there are no changes to the nts have been approved in accordance with our process

t.e of this letter. All events subsequent to the date of theen adjusted or disclosed. Accounting estimates and

events have been appropriately adjusted.

We believe "that the effects of any uncorrecte both individually and in the aggregate, to t

. ·sstatements pertaining to the current period presented, are immaterial, . en as a whole. A list of the uncorrected misstatements aggregated by you

is attached in Appendix A.

Internal Controls 7. We acknowledge our responsibility for the design, and maintenance of internal control to prevent and detect fraud and error.

8. We have disclosed to you all known deficiencies in th sign or operation of internal control over financial reporting identified as part of our evaluation, including separately disclosing to you all such deficiencies that we believe to be significant deficiencies in internal control over financial reporting.

Information provided 9. We have provided you with:

14

a. Access to all information of which we are aware that is relevant to the preparation of the Financial Statements, such as records,documentation and other matters.

b. All relevant information as well as additional information that you have requested from us for the purpose of the audit; and,


- 91 -


c. Unrestricted access to persons within the entity from whom you determined it necessary to obtain audit evidence.

10. Except as listed in Appendix A, all transactions have been properly recorded in the accounting records and are reflected in the FinancialStatements.

11. We have disclosed to you the results of our assessment of the risk that the Financial Statements may be materially misstated as a result of

fraud.

12. We have disclosed to you all information in relation to fraud or suspected fraud that

a. Management;

b. Employees who have significant roles in internal control; or

c. Others where the fraud could have a material effect on the Financial Stat

13. We have disclosed to you all information in relation to allegations of actualaffecting the City.

14. We have disclosed to you all communications from regulatory agenc '<�W

practices and all known instances of non-compliance or suspecte on-c when preparing the Financial Statements.

aware of and that affects the entity and involves:

on-compliance with or deficiencies in financial reporting th laws and regulations whose effects should be considered

15. W,e have disclosed to you the identity of the entity's related s and al elated party relationships and transactions of which we are

aware, including guarantees, non-monetary tran

shares risks between group entities.

16. We have disclosed to you all known, actueffects should be considered when preparinthe Financial Statements in accordance with P

Independence matters For purposes of the following paragraphs, "Deloitte" shall and affiliates.

actions for no consideration and participation in a defined benefit plan that

aims, whether or not they have been discussed with our lawyers, whose

ments. As appropriate, these items have been disclosed and accounted for in

an Deloitte LLP and Deloitte Touche Tohmatsu Limited, including related member firms

17. Prior to the City having any substantive employment conversations with a former or current Deloitte engagement team member, the City has·

held discussions with Deloitte and obtained approval from the Executive Committee of the Council.

18. We have adhered to all regulatory requirements regarding the provision of non-audit services by Deloitte to the City in accordance withapplicable laws, regulations and rules that apply to the City, including the Executive Committee approval requirements.

19. We have ensured that all services performed by Deloitte with respect to this engagement have been pre-approved by the Executive Committeein accordance with its established approval policies and procedures.


- 92 -


Communications with taxation and regulatory agencies 20. We have disclosed to you all communications from:

a. Taxation authorities concerning assessments or reassessments that could have a material effect on the Financial Statements; and

b. Regulatory agencies concerning noncompliance with or potential deficiencies in, financial reporting requirements.

Deficiencies in internal control 21. We have communicated to you all deficiencies in internal control of which we are a.w · e have disclosed to you any change in the City's

rially affected, or is reasonably likely to materiallyinternal control over financial reporting that occurred during the current yearaffect,·the City's internal control over financial reporting.

Work of management's experts

22. We agree with the work of management's experts in evaluating the valuation

and have adequately considered the capabilities of the experts in determi

underlying. accounting records. We did not give any, nor cause any, in amounts derived in an attempt to bias their work, and we are not a

the experts.

Liabilities and contingencies 23. We have disclosed to you all liabilities, provisions, continge

whether written or oral, and they are appropriate! "r;

Loans and receivables

-emplo benefits liability and WSIB benefits liability

and disclosures used in the Financial Statements and

.en to management's experts with respect to values or atters hat have impacted the independence or objectivity of

24. The City is responsible for determining an

as estimates used to determine such amou

the account balances.

quacy of the allowance for doubtful notes, loans, and accounts receivable, as well lieves the allowances are adequate to absorb currently estimated bad debts in

Employee future benefits 25. Employee future benefit costs, assets, and obligation ve been properly recorded and adequately disclosed in the Financial Statements

including those arising under defined benefit plans as well as termination arrangements. We believe that the actuarial assumptions and methods

used to measure defined benefit plan assets, liabilities and costs for financial accounting purposes are appropriate in the circumstances.

Government transfers 26. We have disclosed to you all correspondence relating to government transfers that the City has had with the funding body.

27. We have assessed the eligibility criteria and determined that the City is an eligible recipient for the government transfers received.

28. We have assessed the stipulations attached with the funding and have recognized the revenue in accordance with meeting the stipulationsrequired.


- 93 -


29. All government transfers that have been recorded as deferred revenue give rise to an obligation that meets the definition of a liability. Thoseliabilities have been properly recorded and presented in the Financial Statements.

Tax Revenues 30. We have appropriately recorded tax assets and revenues when they meet the definition of an asset in accordance with Section PS 1000,

Financial Statement Concepts, when they are authorized and when the taxable event occurs. These amounts have been appropriately measuredin accordance with PS 3510, Tax Revenue, and have not been grossed up for any amount of tax concessions.

Tangible capital assets 31. Tangible capital assets have been recorded properly and consistently accordi

32. Contributed tangible capital assets have been appropriately recorded at faircase, have been recorded at an appropriate nominal value. All contributed ta

33. We have assessed the useful lives of tangible capital assets and have detprovide goods and services and therefore do not require a write down.

Environmental liabilities/ contingencies 34. We have considered the effect of environmental matters on the

from environmental matters. All liabilities, provisions, contin. eenvironmental matters on the carrying values of the relevaStatements.

Government Business Enterprises and 35. The City has appropriately classified its in

ards in Section PS 3150, Tangible Capital Assets.

·s not reasonably determinable, and in suchave been appropriately disclosed.

gible capital assets contribute to the City's ability to

ed to you all liabilities, provisions or contingencies arising ents arising from environmental matters, and the effect of

ed, measured and disclosed, as appropriate, in the Financial

With regard to the City's investment in Verididiscovered with respect to such investment tha

e have disclosed to you any events that have occurred and facts that have been he investment's value as reported in the financial statements.

Liabilities for contaminated sites 36. We have evaluated all of our tangible capital assets th we have direct responsibility for or accept responsibility for, and have not identified any

sites in which contamination exceeds an environmental standard.

Other matters 37. We have disclosed to you all the documents that we expect to issue that may comprise other information, in the context of CAS 720, The

Auditor's Responsibilities Relating to Other Information in Documents Containing Audited Financial Statements.

38. The City has satisfactory title to and control over all assets, and there are no liens or encumbrances on such assets. We have disclosed to youand in the Financial Statements all assets that have been pledged as collateral.


ips Corporation as a Government Business Partnership.

- 94 -


39. We have disclosed to you, and the City has complied with all aspects of contractual agreements that could have a material effect on the Financial

Statements in the event of non-compliance, including all covenants, conditions or other requirements of all outstanding debt.

Yours truly,


Stan Karwowski

Director of Finance and Treasurer

Tony Prevedel

Chief Administrative Officer


- 95 -


Appendix A


Summary of uncorrected financial statement misstatements

Year ended December 31, 2018

Amortization Expense is overstated

DR. Accumulated Amortization

CR. Depreciation Expense

$920,133

$920,133

To correct overstatement of amortization expense for the year as a result of rev

the year.

19

':'

of useful lives of tangible capital assets for


- 96 -

DRAFT AS AT 05/29/2019

Consolidated financial statements of


December 31, 2018

- 97 -


Independent Auditor's Report ...... ! ......................................................... 1-2

Consolidated statement of financial position ............................................... 3

Consolidated statement of operations ........................................................ 4

Consolidated statement of change ir\ net financial assets ............................. 5

Consolidated statement of cash flows ........................................................ 6

Notes to the consolidated financial statements ....................................... 7-28

- 98 -

Deloitte.

Independent Auditor's Report

To the Members of Council of The Corporation of the City of Pickering

Opinion

DRAFo�Sil!&:rL!il.p/29/2019 400 Applewood Crescent Suite 500 Vaughan ON L4K 0C3 Canada


We have audited the consolidated financial statements of The Corporation of the City of Pickering (the "City"), which comprise the consolidated statement of financial position as at December 31, 2018, and the consolidated statements of operations, change in net financial assets and cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies (collectively referred to as the "financial statements").

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the City as at December 31, 2018, and the results of its operations, changes in net financial assets, and its cash flows for the year then elided in accordance with Canadian public sector accounting standards ("PSAS").

Basis for Opinion We conducted our audit in accorda.nce with Canadian generally accepted auditing standards (''Canadian GAAS"). Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Audit of the Financial Statements" section of our report. We are independent of the City in accordance with the.ethical requirements that are relevant to our audit of the financial statements in Canada, arid we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with PSAS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the City's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the City or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the City's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

- 99 -


As part of an audit in accordance with Canadian GAAS, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resulting from error,as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the overrideof internal control.

• Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the City's internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accountingand, based on the audit evidence obtained, whether a material uncertainty exists related to eventsor conditions that may cast significant doubt on the City's ability to continue as a going concern. Ifwe conclude that a material uncertainty exists, we are required to draw attention in our auditor'sreport to the related disclosures in the financial statements or, if such disclosures are inadequate,to modify our opinion. Our conclusions are based on the a.udit evidence obtained up to the date ofour auditor's report. However, future events or conditions may cause the City to cease to continueas a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions andevents in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness activities within the City to express an opinion on the financial statements. We areresponsible for the direction, supervision .and performance of the group audit. We remain solelyresponsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during ou.r audit.

Chartered Professional Accountants Licensed Public Accountants June 17, 2019

- 100 -


Consolidated statement of financial position As at December 31, 2018

Financial assets

Cash and cash equivalents Investments Taxes receivable Accounts receivable Note receivable Investment in Veridian Corporation Promissory notes receivable Land held for resale

Liabilities

Accounts payable and accrued liabilities Other current liabilities Deferred revenue Long-term liabilities Post-employment benefit liability WSIB benefit liabilities

Net financial assets

Non-financial assets

Tangible capital Prepaid expenses Inventory

Accumulated surplus

Notes

3

17 4 (b)

5 10(v)

10

11


2018 2017

$ $

100,619,531 89,766,742 78,380,565 82,226,068 19,340,620 16,571,391

4,192,551 4,780,330 3,530,086 3,796,946

56,516,836 53,393,124 25,069,000

294,531 275 898 132

26,414,563 4,694,538

65,194,413 31,412,982

5,609,656 1,862,876

148,944,242 135,189,028

142,849,850 140,709,104

259,879,354 240,256,987 231,462 295,196 372,227 427,332

260,483,043 240,979,515 403,332,893 381,688,619

The accompanying notes to the consolidated financial statements are an integral part of this consolidated financial statement.

Page 3

as

25,069,000 4,144,903

- 101 -


Consolidated statement of operations Year ended December 31, 2018

Notes

Revenue

Residential and farm taxation Commercial and industrial taxation

Taxation from other governments User charges Government grants and fees

Other contributions and donations Development charges and

developer contributions earned

Contributed tangible capital assets 10(i) Investment income Penalties and interests on taxes

Fines

Interest on promissory notes Sale of land

Equity share of Veridian Corporation earnings

Other Gain on disposal of tangible

capital assets

Expenses

General government

Transportation services

Environmental services

Social and family services

Recreational and cultural services

Planning and development

Loss on disposal of tangible capital assets

Annual surplus

Accumulated surplus,

beginning of year Accumulated surplus, end of year


2018 2017

Budget

(Note 18) Actual Actual

$ $ $

49,425,675 50,047,871 47,468,880 11,053,425 11,088,267 10,793,717

8,312,581 8,460,282 8,644,938

11,009,646 15,190,523 11,082,163 6,798,272 5,554,251 6,356,344 1,129,925 5,230,490 2,189,348

1,468,880

5,014,463

941,197 2,362,493

855,391 1,229,138

5,050,712 4,179,608 900,306 358,861

22,927,289

112,409,881 125,872,710

23,458,467 17,065,742 16,298,488 25,890,304 24,761,169 23,979,527

13,184,660 12,728,165 12,296,200 3,781,485 3,452,661 3,624,256

833,586 780,850 765,708

28,472,510 28,680,931 27,190,180 3,858,162 3,050,084 2,583,253

246,005

99,479,174 90,765,607 86,737,612

32,068,302 21,644,274 39,135,098

381,688,619 381,688,619 342,553,521 413,756,921 403,332,893 381,688,619


Page 4

Protection to persons an

- 102 -



Consolidated statement of change in net financial assets Year ended December 31, 2018

2018

Budget

(Note 18) Actual

$ $

Annual surplus 32,068,302 21,644,274

Acquisition of tangible capital assets (62,755,373) (37,520,480)

Amortization of tangible capital assets 10,392,202 12,480,087

Loss (gain) on disposal of tangible capital assets 246,005

Proceeds on disposal of tangible capital assets ,£.;:,,,"

Transfer of assets under construction to tangible capital assets

Assets under construction expensed

Acquisition of inventory of supplies (700,163)

Use of inventory of supplies 755,268

Acquisition of prepaid expenses (231,462)

Use of prepaid expenses . 295,196

118,839

Change in net financia '-�

✓

�i?}1� (20�294,869) 2,140,746

Net financial assets, be 140,709,104 140,709,104

Net financial assets, 120,414,235 142,849,850

2017

· Actual

$

39,135,098

(31,772,704) 10,800,559

(22,927,289)

23,501,156 18,736,820

3,762,471 215,451

3,977,922

(818,222) 613,402

(295,196) 248,303

(251,713)

22,463,029 118,246,075 140,709,104

The accompanying notes to the . 1dated financial statements are an integral part of this consolidated financial statemeri

Page 5

Ai;)).37,444

- 103 -



Consolidated statement of cash flows

Year ended December 31, 2018

Operating transactions . Annual surplus Non-cash items

Amortization of tangible capital assets Loss (gain) on disposal of tangible capital assets Equity share of Veridian Corporation Contributed tangible capital assets

recorded in revenue Change in non-cash operating items

Taxes receivable Accounts receivable Accounts payable and accrued liabilities other current liabilities Deferred revenue Post-employment benefit liability WSIB benefit liabilities Inventory Land held for resale Prepaid expenses

Capital transactions Acquisition of tangible capital assets

(net of transfers and contributions) Proceeds on disposal of tan��',:;;;,,;,*'

Investing transaction

Decrease (increase) in Dividends received from

Financing transactions Proceeds from debentures issued Principal repayment of debentures Decrease in note receivable

Increase in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year

Cash and cash equivalents consists of Cash Cash equivalents

2018

$

21,644,274

12,480,087 246,005

(5,050,712)

(995,033)

(2,769,229) 587,779

,·<(idi;t:J/

55,105 ,850,372)

63,734 38,160,861

{31,490,870) 137,444

{31,353,426)

3,845,503 1,927,000 5,772,503

3,604,000 (5,598,009)

266,860 (1,727,149)

10,852,789 89,766,742

100,619,531

16,110,036 84,509,495

100,619,531


2017

$

39,135,098

10,800,559 (22,927,289)

(4,179,608)

(5,014,463)

(837,961) (1,690,700) 6,731,036 4,561,231 4,692,846.

650,156 56,776

(204,820) (294,531)

(46,893) 31,431,437

(22,780,319) 23,501,156

720,837

(33,368,104) 2,093,870

(31,274,234)

12,941,000 (2,983,834)

258,330 10,215,496

11,093,536 78,673,206 89,766,742

11,376,673 78,390,069 89,766,742

Page 6 - 104 -



Notes to the consolidated financial statements December 31, 2018

1. Significant accounting policies

The consolidated financial statements ("the financial statements") of The Corporation of the Cityof Pickering (the "City") are the representations of management prepared in accordance withaccounting standards established by the Public Sector Accounting Board ("PSAB") of CharteredProfessional Accountants of Canada (CPA Canada). Significant accounting policies adopted bythe City are as follows:

(a) Reporting entity

(i) Consolidated financial statements

The consolidated financial statements reflect the assets, liabilities, revenues andexpenses of the reporting entity. The reporting entity is comprised of the activities ofall committees of Council and the City of Pickering Public Library Board which iscontrolled by the City.

All material inter-fund transactions and bat inated on consolidation.

(ii) Investment in Veridian Corporation

(iii)

The City's investment in Veridian Corpora . a modified equity basis, consistent with Canadian public sec unting sta ards for investments in government business partnerships. U the i ied equity basis, Veridian Corporation's accounting policies ar: ste ,<•,,�nform to those of the City andinter-organizational transactions c;r, re nolreliminated. The City recognizes its equity interest in the annual �"a'.fni ,,.Qf Veridian Corporation in its consolidated statement of o tions a l""'•r:esponding increase or decrease in its investment asset account ends ity may receive from Veridian Corporation and other ca reflected as adjustments in the investment asset

e Region of Durham

s, e p nditures, assets and liabilities with respect to the rds and the Region of Durham (the "Region") are not · financial statements.

(iv) Trust funds

Trust funds and t elated operations administered by the City are not consolidated, but are reported separately on the Trust Funds Statement of Financial Activities and Statement of Financial Position.

(b) Basis of accounting

(i) Accrual basis of accounting

Revenue and expenses are reported on the accrual basis of accounting. The accrualbasis of accounting recognizes revenues as they are ea�ned and measurable; expensesare recognized as they are incurred and measurable as a result of the receipt of goodsand services and the creation of a legal obligation to pay.

(ii) Cash and cash equivalents

Cash and cash equivalents consist of cash on hand, demand deposits and short-term,highly liquid investments that are readily convertible to known amounts of cash. Cashequivalents have a short-term maturity of three months or less from the date ofacquisition.

Page 7 - 105 -




1. Significant accounting policies ( continued)

(b) Basis of accounting (continued)(iii) Investments

Long-term investments are recorded at cost and any loss in value which is consideredother than temporary is recorded as incurred. Any premium or discount at thepurchase of an investment is amortized over the life of the investment.

(iv) Tangible capital assets ("TCA")

(v)

Tangible capital assets are recorded at cost less accumulated amortization. Costincludes all costs directly related to acquisition or construction of the tangible capitalasset including transportation costs, installation costs, design and engineering fees,legal fees and site preparation costs. During fiscal 2018, the City performed a reviewof its tangible capital assets and updated estimated us ful lives for certain tangiblecapital assets. Amortization is recorded on t '· · ine basis over the estimated useful life of the tangible capital asset co the asset is available for use as follows: Buildings Machinery and equipment Vehicles Infrastructure - Roads Infrastructure - Storm sewers Infrastructure - Sidewalks Infrastructure - Parks Information technology hardy/'.);e Library collection materials Furniture and fixtures

Accounting fo Assessment Sys

I amo .tion is charged in the year of acquisition and in the d J;istruction are not amortized until the tangible capital ctive'U,�)'• Land is not amortized.

ved as contributions are recorded at their fair value at the rresponding amount recorded as revenue.

x Capping Provisions resulting from the Ontario Fair

The net impact on p operty taxes as a result of the application of the capping provisions does not affect the Consolidated Statement of Operations as the full amounts of the property taxes were levied. However, the capping adjustments are reported on the Consolidated Statement of Financial Position as a receivable/payable from/to the Region.

(vi) Deferred revenueDeferred revenues represent contributions, user charges and fees which have beencollected but for which the related services have yet to be performed. These amountswill be recognized as revenues in the fiscal year the services are performed. Inaddition, any contributions received with external restrictions are deferred until therelated expenditures are made.

(vii) Post-employment benefitsThe present value of the cost of providing employees with future benefit programs is recognized as employees earn these entitlements through service. Actuarial gains and losses are amortized over the average remaining service period ("ARSP"). The actuarydetermined ARSP to be between 11 to 13 years, depending on the employee group.For WSIB benefit obligations that arise from specific events that occur from time totime, the cost is recognized immediately in the period the events occur. Actuarial gainsand losses are amortized over the average remaining service period of 15 years.

Page 8 - 106 -




(b) Basis of accounting ( continued)

(viii) Inventory


Inventory is valued at the lower of cost and replacement cost. Cost is determined on aweighted-average basis.

(ix) Government transfers

Government transfers are recognized as revenue by the City in the period in which thetransfers are authorized and any eligibility criteria are met, unless they are restrictedthrough stipulations that require specific actions to be carried out in order to keep thetransfer or discharge the liability. For such transfers, revenue is recognized when thestipulation has been met.

(x) Tax revenue

Tax revenue is recognized on all taxable prthe tax roll provided by the Municipal Protax values included in the tax roll or propestimated by the City as it relates to suprates authorized by Council for the City'sis levied.

(xi) Intangible assets

Intangible assets are not recognized/ff!/

(xii) Contaminated sites "cf

n the City that are included in nt Corporation, using property that can be reasonably

ssessments, at tax riod for which the tax

Contaminated sites are the water or sediment of a cl{� exceeds an environmental•

tion being introduced into air, soil, dioactive material or live organism that

ndard. A lia I ity for remediation of contaminated sites is recoveries, when all of the following criteria are met:

(a)

(b)

(c)

(d)

(e)

sts· '"-<qj? I

the environmental standard;

onsible or accepts responsibility for the liability;

fits will be given up; and

A liability is recorded only for sites that are not in productive use or if there was an unexpected event that resulted in contamination. Changes in estimates are recorded in the City's statement of operations. The City does not have any liability for contaminated sites recorded in the consolidated financial statements.

(xiii) Land held for resale

Land permanently removed from service that meet the criteria for inventory held forresale are recorded as "land held for resale" on the Consolidated Statement ofFinancial Position and is recorded at the lower of cost and net realizable value. Thosethat do not meet these criteria continue to be recorded as part of "tangible capitalassets" on the Consolidated Statement of Financial Position.

Page 9

of the liability can be made.

- 107 -





(b) Basis of accounting (continued)

2.

3.

(xiv) Use of estimates

The preparation of financial statements in conformity with Canadian public sectoraccounting standards requires management to make estimates and assumptions thataffect the reported amounts in the financial statements and accompanying notes.Accounts involving significant estimates include allowance for doubtful accounts,certain accrued liabilities, post-employment benefits liability, WSIB liabilities andestimates relating to the useful lives of tangible capital assets. Actual results coulddiffer from these estimates.

Operations of school boards and the Regional Municipality of Durham

Further to Note 1 (a) (iii) requisitions are made by th School Boards requiring the City to collect property on their behalf. The amounts collected and remitte

A4¼,, L}f!f:::+� Regt<:mah;fv'lunicipality of Durham and s clQ'tl�f2ayments in lieu of property taxes

"'""m"0

'' " ed as follows:

Taxation Payments in lieu of taxes

Investments

2018 Market value

$ $

Investments 78,041,001

$

106,559,478 6,457,366

113 016 844

Cost $

82,226,068

2017 School board

$

45,352,981 381,700

45 734 681

2017 Marlet value

$

81,919,658

Investments are comprised of deposit notes, bonds, and guaranteed investment certificates.

4. Investment in Veridian Corporation

(a) Veridian Corporation is owned by the City of Pickering, Town of Ajax, Municipality ofClarington and the City of Belleville. The City has a 41 per cent interest in VeridianCorporation. Veridian Corporation, as a government business partnership, is accounted foron the modified equity basis in these consolidated financial statements. VeridianCorporation serves as the electrical distribution utility for a number of communitiesincluding the four noted above and conducts non-regulated utility service ventures throughits subsidiaries.

Page 10 - 108 -


Notes to the consolidated financial statements

December 31, 2018

4. Investment in Veridian Corporation (continued)

(a) (continued)


The following table provides condensed supplementary consolidated financial informationfor Veridian Corporation and its subsidiaries for the year ended December 31. All amounts in tables are disclosed in thousands of dollars:

Assets Current Capital and intangibles Other

Regulatory balances

Liabilities Current Long-term debt Other

Shareholders' equity Share capital Contributed Accumula Retained

Comprehensive income Commodity revenue Commodity expenses Distribution revenue Other income Operating expenses Other expense Other comprehensive income Net movements in regulatory balances,

net of tax Income tax expense

2018 (OOO's)

$

70,908 291,057

166

152,979 7,132

33,310 223,421

67,260 25

(53) 70,537

137,769 8,158

369,348

266,543 (269,157)

54,254 3,555

(42,200) (3,827)

263

5,949 (3,061) 12,319

2017 (OOO's)

$

77,555 269,380

1,097 348,032

2,852 350,884

116,129 65,021 29,765

210,915

67,260 25

(316) 63,258

130,227 9,742

350,884

280,206 (277,975)

52,225 2,630

(41,620) (2,593)

24

965 (3,668) 10,194

Page 11 - 109 -




4. Investment in Veridian Corporation ( continued)

(b) City of Pickering's investment represented by:

2018 2017 $ $

Promissory notes receivable (Note 5) 25,069,000 25,069,000

Investments in Veridian Corporation Initial investment in shares of the Corporation 30,496,196 30,496,196 Accumulated earnings 55,630,394 50,579,682 Accumulated dividends received (30,425,462) (28,498,462) Adjustment to value of investment 8 5,708 815,708

,836 53,393,124

(c) Equity in Veridian Corporation

2017 $

Balance, beginning of year 81, 05,144 79,419,406 Equity share of net earnings for 5,050,712 4,179,608 Dividend received from Veridia (1,927,000) (2,093,870) Balance, end of year (Note 84,628,856 81,505,144

( d) Contingenciestheir consol�

f .. Jl Corporation (the "Corporation") as disclosed in ments"'are as follows:

(i)

The Corporat of the Municipal Electric Association Reciprocal Insurance Exchange ("M ch was created on January 1, 1987. A reciprocal insurance exchange may be ed as a group of persons formed for the purpose of exchanging reciprocal contracts of indemnity or inter-insurance with each other. MEARIE provides general liability insurance to member electric utilities. MEARIE also provides vehicle and property insurance to the Corporation.

Insurance premiums charged to each member utility consist of a levy per $1,000 of service revenue subject to a credit or surcharge based on each electric utility's claims experience. The maximum coverage is $30,000,000 per occurrence for liability insurance, $21,000,000 for vehicle insurance and $119,736,000 for property insurance, plus $10,000,000 excess coverage on top of the regular liability and vehicle coverage.

Page 12

Insuranc

- 110 -




4. Investment in Veridian Corporation ( continued)

(d) Contingencies and guarantees of Veridian Corporation (the "Corporation") as disclosed intheir consolidated financial statements are as follows: (continued)

(e)

(ii) Contractual obligation - Hydro One Networks Inc. ("HONI") (continued)

The Corporation's subsidiary, Veridian Connections Inc. ("VCI"), is party to aconnection and cost recovery agreement with HONI related to the construction by HONI of a transformer station designated to meet VCI's anticipated electricity loadgrowth. Construction of the project was completed during 2007 and VCI connected tothe transformer station during 2008.

To the extent that the cost of the project is not recoverable from future transformationconnection revenues, VCI is obligated to pay a capital contribution equal to thedifference between these revenues and the construction costs allocated to VCI. Theconstruction costs allocated to VCI for the proje ,975,000.

The Corporation has recorded a liability a $1,484,000 as at December 31, 2018 (2 best estimate of the future transformatio process of performing a true-up based on anniversary of the in-service date and is e on actual load at the end of the fiftee

(iii) General claims

From time to time, the Corporatiregulatory proceedings in th ormalmanagement, the outcome uch mthe Corporation's consoliflows.

ing intangible asset for 0), based on management's

£�J1ortfall. HONI is in the := ., of the tenth

to perfo another true-up based of the in-service date.

various lawsuits, claims and siness. In the opinion of

not have a material adverse effect on on and results of operations or cash

Future mini bligations under operating leases are as follows:

2019

2020

2021

2022

2023

Thereafter

$ (000's)

6 2 2 2 2

50 64

(f) Subsequent event

On April 1, 2019, Veridian Corporation amalgamated with Whitby Hydro Energy Corporationto form Elexicon Corporation. The predecessor shareholders of Veridian Corporation beingthe City of Pickering, the Town of Ajax, the City of Belleville and the Municipality ofClarington will collectively own 68% of the newly formed Elexicon Corporation. This willresult in the City having a 27.88% interest in Elexicon Corporation. The financial impact of the amalgamation to the City's investment and accumulated surplus balances will bereported in the City's consolidated financial statements for the December 31, 2019 yearend.

Page 13 - 111 -

The Corporation of the City of Pickering Notes to the consolidated financial statements December 31, 2018

5. Promissory notes receivable

Promissory note receivable from Veridian Corporation which matured on December 31, 2018 and bearing interest at the greater of 6% or the Ontario Energy Board deemed long term debt rate on an annual basis to maturity (See (a) and (c) below)

Promissory note receivable from Veridian Connections Inc. maturing November 1, 2039 and bearing interest at the Ontario Energy Board deemed long-term debt rate for each successive five year period thereafter (4.47% effective January 1, 2015)


2018 2017 $ $

7,095,000 7,095,000

17,974,000 25,069,000

,"'ion matured on December 31, 2018 9 or the closing date of the merger

ergy Corporation, as defined in the

(a) The promissory note receivable froand was extended to the earlier obetween Veridian CorporationMerger Participation Agreeme een the n of Ajax, City of Belleville, the Municipality of Clar' ring, Town of Whitby, Veridian Corporation, Veridian ConnecCorporation.

,�g Energy Corporation and Whitby Hydro Electric pro'fi:tTusory note remain the same.

(b) Interest reve notes receivable totaled $1,229,138 (2017 -$1,229,138). Th missory note from Veridian Corporation is convertible into common shares at e common share for every $1,000 of principal amount, at the option of the City from Veridian Connections Inc. is no longer convertible but the City may demand f partial repayment with six months' notice with certification that the funds are required for municipal purposes. The City has signed an inter-creditor agreement confirming the subordinated ranking of these promissory notes to the senior debt financing issued by Veridian.

(c) On November 20, 2014, the Ontario Energy Board's deemed long-term rate was establishedfor the five year period commencing January 1, 2015 until December 31, 2019 at 4.47%.This rate will be reset on January 1, 2020.

Page 14 - 112 -



6. Deferred revenue

Obligatory reserve funds

Development charges

Parkland

Federal gas tax

Third party /Developer's contributions reserve fund

Public benefits

Other unearned revenues

Continuity of deferred revenue is as follows:

Balance, beginning of year

Restricted funds received

General funds received

Interest earned (restricted fund

Earned restrict

Earned revenue

Balance, end of year


2018 2017

$ $

58,789,415 48,100,585

6,463,242 4,532,056

5,310,843 5,654,549

2,790,108 2,957,593

141,387

73,353,608 61,386,170

4,129,320 3,808,243

Ji:407z,ai)J2, g 28 65,194,413

2017

$

60,501,567

0,092,304 9,169,370

896,508 2,900,813

1,064,773 830,571

22,053,585 12,900,754

9,189,639 7,151,044

575,431 1,056,864

9,765,070 8,207,908

77,482,928 65,194,413

Page 15 - 113 -



December 31, 2018

7. Interfund loans


As a means of funding various capital acquisitions, funds are borrowed by the Capital Fund fromDevelopment Charges deferred revenue (obligatory reserve funds). These funds are secured bypromissory notes with interest rates ranging from 1.83% to 2.64% and various payment termsranging from 5 years to 10 years. The financing arrangements and ultimate repayment are approved by Council through the current budget process. Although these notes have paymentterms as noted above, they are repayable on demand. The following is a summary of therelated interfund loans:

Roads and streetlights Community facilities, libraries and parks Protection services Stormwater system

8. Post-employment benefits liability

2018

$

2017

$

1,226,910 1,385,745

337,226. 645,360

3 595,241

retire before the age of 65, the uch as post-retirement extended

(a) Post-employment benefits liability

The City makes available to qualifopportunity to continue their cohealthcare benefits. Coveragepermanent part-time loye

65. The City also provides full time andck time entitlement and any unused entitlement is

accumulated yeatime of retireemploymenDecember 3

lated entitlement is not vested and is forfeited at the ost recent actuarial valuation of the post-ecember 31, 2017, with a projection to

efits liability is as follows:

Accrued benefits liability, beginning of year Plan amendment Current service cost.s Interest on accrued benefits Amortization of actuarial losses Benefits paid during the year Accrued benefits liability, end of year

Accrued benefit obligation Unamortized actuarial losses Accrued benefits liability, end of year

2018

$

5,609,656

535,285

411,606

538,856

(835,209)

6,260,194

11,237,755

(4,977,561)

6,260,194

2017

$

4,959,500 384,991 416,276 223,108 186,200

(560,419) 5,609,656

11,126,073 (5,516,417) 5,609,656

Page 16 - 114 -


The Corporation �f the City of Pickering Notes to the consolidated financial statements December 31, 2018

8. Post-employment benefits liability ( continued)

(a) Post-employment benefits liability (continued)

The main actuarial assumptions employed in the actuarial valuations for the postemployment benefits are as follows:

(i) Discount rateThe present value as at December 31, 2018 of the future benefits was determinedusing a discount rate of 3.75% (2017 - 3.75%).

(ii) Dental costsThe dental cost trend rate was 3.75% (2017 - 3.75%) increase per annum.

(iii) Health costs

Health costs were assumed to increase at 6.42%:

0.33% (2017 - 0.33%) increments per yea2027 and thereafter.

(b) Workplace Safety and Insurance Board (WSIB

- 6.75%) and decrease byte rate of 3.75% per year in

Effective January 1, 2001, the City became a S, .,,,,. II emp nder the Workplace Safety & Insurance Act and follows a policy of self-�lncince for the risk associated with paying benefits for workplace injuries for./ plofeJt��The WSIB administers theclaims related to workplace injuries an d bl{tfe City. The most recent actuarial valuation of the WSIB benefi d at December 31, 2016, with a projection to December 31, 2018.

Information about the City's

2018 2017 $ $

Accrued WS 1,862,876 1,806,100 128,519 124,773

Interest on acer 90,135 89,144 Amortization of act 30,254 30,254 Benefits paid during t (194,605) (187,395)

1,917,179 1,862,876

Accrued benefit obligation 2,310,476 2,286,427 Unamortized actuarial losses {393,297) (423,551) Accrued benefits liability, end of year 1,917,179 1,862,876

The main actuarial assumptions employed in the actuarial valuations are as follows: (i) Discount rate

The present value as at December 31, 2018 of the future benefits was determinedusing a discount rate of 4.0% (2017 - 4.0%).

(ii) Inflation rateThe rate of inflation was assumed to be 1.75% (2017 - 1.75%) per annum.

Page 17 - 115 -



8. Post-employment benefits liability (continued)


(b) Workplace Safety and Insurance Board (WSIB) benefit liabilities (continued)

(iii) WSIB Administration Rate

Liabilities for WSIB benefits have been increased 38% to reflect the administrationrate charged by WSIB.

A WSIB Reserve Fund was established in 2001. The Reserve Fund balance atDecember 31, 2018 (Note 11 ) was $3,548,321 (2017 - $3,209,349 ). In addition, theCity purchased two insurance policies that protect the City against significant claims.The occupational accident insurance pays loss claims up to $500,000 per work relatedaccident. The excess workers compensation indemnity insurance has a $500,000deductible and will pay for claims up to and including $15,000,000 per work relatedaccident.

9. Long-term liabilities

(a) The balance of long-term liabilities is made up

2017 $

The City is responsible for the paym� >?

of principal and interest charges on"% liabilities issued by the Regio of Durham on the City's be 'a the year the outstanding prin this liability is

(b) The above I,'2020, Septe2026 and 2031,2033 and 2038 WI

29,418,973 31,412,982

ve ma urity dates of July 12, 2021 and 2022, October 15, ber 16, 2023, July 2, 2019 and 2029, October 17, 2021, 2, 2027, 2032 and 2037 and September 14, 2023, 2028, rest rates ranging from 1.10% to 5 .12%. Principal

s follows:

2019 2020 2021 2022 2023 Thereafter

$

3,129,986 3,164,344 3,338,385 2,372,998 2,172,597

15,240,663 29,418,973

(c) Long-term liabilities include principal sums of $952,000 (2017 - $2,415,000 ) which may berefinanced by the issuance of debentures over a further period not to exceed 5 years.

(d) The above long-term liabilities have been approved by Council by-law. The annual principaland interest payments required to service these liabilities are within the annual debtrepayment limit prescribed by the Ministry of Municipal Affairs and Housing.

(e) Interest expense recorded in the year relating to these long-term liabilities is $935,509(2017 - $715,544 ).

Page 18 - 116 -




December 31, 2018

10. Tangible capital assets

Information relating to tangible capital assets is as follows:

(i) Contributed tangible capital assets

The City records tangible capital assets contributed by an external party at fair value on thedate contributed. Typical examples are roads, storm sewers and sidewalks installed by adeveloper as part of a subdivision or development agreement. Contributions of tangiblecapital assets in 2018 am_ounted to $995,033 (2017 - $5,014,463).

(ii) Tangible capital assets recognized at nominal value

Land under roads are assigned a nominal value of one Canadian dollar because this landonly supports or is intended to support road infrastructure and the majority of landacquired supporting road allowances was acquired at no cost.

(iii) Works of art and historical treasures

The City has a museum which holds various hipertaining to the heritage and history of the Crecognized as tangible capital assets in the finestimate of the future benefits associated withacquisition or betterment of these assets is recstatements.

es and historical buildings These items are not

·· se a reasonablee made. Any

se in the financial

(iv) Other

(v)

The net book value of tangible capiconstruction is $31,236,184 (201

During the year, there were ncapitalized during the year (2

During they Ontario for

amortized because they are under

ts (2017 - $Nil) and no interest was

capitalized as , �· value reported o Consolidated Statement of Financial Position reflects the purchase

/'�,:-YI price and other rela ·servieing costs recoverable on the sale of land. Subsequent to year "'3';0,, / ;>' end, this parcel of Ian ·was sold to Kubota Inc. in January 2019.

,.

Page 19

a parcel along the 407 corridor from Infrastructure for economic development. As a result, this land was not sset but instead recorded as land held for resale. The

- 117 -




December 31, 2018

10. Tangible capital assets (continued)

Machinery Information Library Furniture Assets and technology collection and under

Land Buildings equipment Vehicles Infrastructure hardware materials fixtures construction 2018

$ $ $ $ $ $ $ $ $ $

Cost Balance,

beginning of year 55,662,991 81,644,369 9,149,950 13,343,358 2,358,369 730,808 18,379,602 463,992,863 Add

Additions during the year 484,872 3,819,321 1,621,835 494,571 366,812 153,602 17,891,159 37,520,480

Less Disposals/transfers

during the year 150 407 1 540 644 332 029 474 319 5 034 577 8 931 707 Balance, end of year 55 997 456 83 923 046 10 439 756 2 250 862 884 410 31 236 184 492 581 636

Accumulated amortization

Balance, beginning of year 44,034,616 4,980,437 1,229,914 1,224,942 320,954 223,735,876

Add Amortization 3,508,849 227,779 405,060 49,992 12,480,087

Less Accumulated

amortization on disposals 1 528 592 665 83 443 474 319 3 513 681

Balance, end of year 46 014 8 170 764 482 1 374 250 1 155 683 370 946 232 702 282 Net book value of

tangible capital assets 55 997 456 121 685 917 718 141 1 095 179 513 464 31 236 184 259 879 354

Page 20

- 118 -




10. Tangible capital assets (continued)

Machinery Information Library Furniture Assets and technology collection and under

Land Buildings eguigment Vehicles Infr;Jstructure hardware materials fi�tures construction 2017 $ $ $ $ $ $ $ $ $ $

Cost Balance,

beginning of year 55,691,303 80,777,919 9,045,684 13,167,746 2,466,112 646,134 11,233,428 441,867,005 Add

Additions during the year 470,067 1,275,576 973,931 768,350 347,502 84,674 11,124,096 31,772,704

Less Disposals/transfers

during the year 498 379 409 126 869 665 455 245 3 977 922 9 646 846 Balance, end of year 55 662 991 81 644 369 9 149 950 2 358 369 730 808 18 379 602 463 992 863


Balance, beginning of year 42,337,115 1,052,167 1,252,263 282,879 218,030,374

Add Amortization 6,439,400 200,817 427,924 38,075 10,800,559

Less Accumulated

amortization on disposals 2 804 727 23 070 455 245 5 095 057

Balance, end of year 164 665 893 1 229 914 1 224 942 320 954 223 735 876 Net book value of

tangible capital assets 55 662 991 37 609 753 6 064 238 116 272 402 555 207 1 133 427 409 854 18 379 602 240 256 987

Page 21

- 119 -



11. Accumulated surplus

The City's accumulated surplus is comprised of the following:

Capital fund Operating fund Equity in Veridian Corporation Tangible capital assets Post-employment benefits liability Internal loans Net long-term liabilities Note receivable soccer facility WSIB benefit liabilities Reserves set aside for special purposes by Council

Working capital Self insurance Replacement of capital equipment Contingencies Rate stabilization City's share for development charge Continuing studies Vehicle replacement Easement settlement Land purchase Seaton development review Financial systems Senior centre Accessibility Winter control

Fence Minor buildings replacement Financial Impact Agreement Tennis Courts

Reserve funds set aside for special purpose by Council Recreation programs and facilities Acquisition of tangible capital assets WSIB Animal shelter Men's slow pitch Operations Centre Roads & bridges Stormwater management Ontario Community Infrastructure Fund Seaton infrastructure Seaton Financial Impact Agreement

2018

$

20,701,530

125,247

84,628,856

259,879,354

(6,081,194)

(1,986,799)

(29,418,973)

3,530,086

7,179)

1,612,757

390

14,403

1,437,822

43,647

700,000

31,944

700,000

294,455

3,430,925

119,345

519,500

150,000

300,000

111,100

377,363

297,686

3,548,321

522,608

144,127

18,375,610

3,456,460

2,683,162

616,668

223,816

777,597

403,332,893


2017

$

25,169,415 125,237

81,505,144 240,256,987

(5,430,656) (3,595,241)

(31,412,982) 3,796,946

(1,862,876)

400,000 869,293

1,804,790 1,632,591

16,823,997 6,884,793

448,190 1,426,438

390 99,403

1,641,805 1,068,647

45D,OOO 31,944

700,000 51,376

3,660,177 258,645 519,500 150,000 100,000 210,745

174,873 293,371

3,209,349 417,706 152,227

25,773,590 2,417,954 1,354,597

55,761 54,493

381,688,619

Page 22

ini

- 120 -




12. Pension agreement

The City makes contributions to the Ontario Municipal Employees Retirement Fund (OMERS),which is a multi-employer plan, on behalf of the members of its staff. The plan is a definedbenefit plan which specifies the amount of the retirement benefit to be received by theemployees based on the length of service and rates of pay.

OMERS provide pension services to over 496,000 active and retired members and about 1,000employers. Each year an independent actuary determines the funding status of OMERS PrimaryPension (the "Plan") by comparing the actuarial value of the invested assets to the estimatedpresent value of all pension benefits that members have earned to-date. The most recentactuarial valuation of the Plan was conducted as at December 31, 2018. The results of thisvaluation disclosed total actuarial liabilities as at that date of $100,081 million in respect ofbenefits accrued for service with actuarial assets at that date of $95,890 million indicating anactuarial deficit of $4,191 million. Because OMERS is a multi-employer plan, any pension plansurpluses or deficits are a joint responsibility of Ontario municipal organizations and theiremployers. As a result, the City does not recognize any s e OMERS pension surplus ordeficit.

Contributions made by the City to OMERS on acco$3,985,649 (2017 - $3,834,325).

13. Trust Funds

14.

Trust funds administered by the City amou,r,included in the Consolidated Statement of�Thaincluded in the Consolidated Statemen f Ope

17 - $361,263) have not been n nor have their operations been :-7

rehol er in Veridian Corporation (Note 4). The City Veridian Corporation and its subsidiary.

Transactions Revenues

Interest on promissory notes Property taxes levied

Expenses Electrical energy and services

Balances Accounts payable and accrued liabilities Promissory notes receivable

2018

$

1,229,138

45,172

2,077,577

403,117

25,069,000

2017 $

1,229,138 49,993

2,153,292

468,782 25,069,000

Page 23

The City of Picke receives electricity

- 121 -

DRAFT AS AT 05/29/2019 The Corporation of the City of Pickering


15. Guarantees

16.

In the normal course of business, the City enters into agreements which contain guarantees.The City's primary guarantees are as follows:(i) The City has provided indemnities under lease agreements for the use of various facilities

or land. Under the terms of these agreements the City agrees to indemnify thecounterparties for various items including, but not limited to, all liabilities, loss, suits, anddamages arising during, on or after the term of the agreement. The maximum amount ofany potential future payment cannot be reasonably estimated.

(ii) The City indemnifies all employees and elected officials including Library employees andboard members for various items including, but not limited to, all costs to settle suits oractions due to association with the City, subject to certain restrictions. The City haspurchased liability insurance to mitigate the cost of any potential future suits or actions.The term of the indemnification is not explicitly defined, but is limited to the period overwhich the indemnified party served as an employee o lee ed official of the City. The maximum amount of any potential future payme reasonably estimated.

(iii) The City has entered into agreements that maparties, such as purchase and sale agreementletters with advisors and consultants, outsourcinformation technology agreements and serviceagreements may require the City to compen��"atecounterparties as a result of breaches inJ -""""''�""·"litigation claims or statutory sanctionsconsequence of the transaction. The t .,and the maximum amount of any e�ti

ee.(llents, engagement {'¾.;if; · g contracts,

ents. ndemnification arties for losses incurred by the

regulations or as a result of suffe 'by the counterpa rty as a

emnities are not explicitly defined ent cannot be reasonably estimated.

The nature of these indemnificatio estimate of the maximum exposur which stems from the un counterparties. Histo; similar indemnific

the City from making a reasonable in assessing the amount of liability

uture events and the unlimited coverage offered to made any significant payments under such or

"'�fore no amount has been accrued in the balance sheet with respe

Litigation The City has been named as a defendant in certain legal actions in which damages have been sought. The outcome of these actions is not determinable as at the date of reporting and accordingly, no provision has been made in these consolidated financial statements for any liabilities which may result.

17. Contractual arrangement

The City entered into a provisional license agreement with the Pickering Soccer Club (PSC) forthe PSC to occupy and operate the Pickering Indoor Soccer Facility (the "Facility"). The term ofthe agreement is 15 years from November 5, 2014 to November 4, 2029. Under the terms ofthe agreement, the PSC will repay 52.25% of the City's total cost of purchasing the land,constructing the Facility and the related improvements .. In 2015, the City recorded a receivablefrom PSC in the amount of $4,550,000 based on preliminary project cost figures, with a 15 yearrepayment term at a variable interest rate ranging from 1.2% to 3.8%. This amount will beadjusted for the total project construction costs, once the agreement is finalized. The City hasreceived all of the required payments to date based on the preliminary figures.

Page 24

- 122 -



December 31, 2018

17. Contractual arrangement (continued)


PSC has commenced its soccer program operations and is operating the Facility at its ownexpense including all repairs and maintenance. Once a final form of agreement is executed thetotal amount of the PSC's obligation will be re-calculated, as agreed, to reflect any adjustmentsto the total project construction costs.

18. Budget figures

The 2018 Budget adopted by Council on February 26, 2018 was not prepared on a basisconsistent with that used to report actual results. The budget was prepared on a modifiedaccrual basis while Canadian Public Sector Accounting Standards require a full accrual basis ofaccounting. The budget figures treated all tangible capital asset acquisitions as expendituresand did not include amortization expense on tangible capital assets or post-employmentbenefits expenses on a full accrual basis. As a result, the budget figures presented in theConsolidated Statements of Operations and Change in · "�·a1 Assets represent the budgetadopted by Council on February 26, 2018 with adju

2018 2018 st-

Budget presented in

amortization statements

$ $

Revenue

Taxation 68,791,681 Capital 45,024,104 other 17,731,691

131,547,476

Expenditures

General governm 5,230,000 628,547 23,458,467 12,000 908,950 25,890,304

245,000 3,586,144 13,184,660 Environmental services 2,128,380 3,781,485 Social and family services 833,586 833,586 Recreational and cultural services 24,663,788 290,000 3,518,722 28,472,510 Planning and development 3,856,353 1,809 3,858,162

82,929,622 5,777,000 10,772,552 99,479,174

Annual surplus ( deficit) 48,617,854 (5,777,000) (10,772,552) 32,068,302 Capital expenditures (68,532,373) 5,777,000 (62,755,373) Transfers from reserve and

reserve funds 12,555,317 Dividend from Veridian Corporation 1,927,000 Principal repayment of debt (4,629,768) Principal repayment of PSC note 219,000 Debt proceeds 9,717,970 Prior year operating fund surplus (125,000)

Page 25

- 123 -




19. Segmented information

The City of Pickering is a diversified municipal government that provides a wide range ofservices to its residents. Distinguishable functional segments have been separately disclosed inthe segmented information. The nature of the segments and the activities they encompass areas follows:

General government

This item relates to revenues and expenses of the City itself and cannot be directly attributed to a specific segment.

Protection to persons and property

Protection includes fire services, animal control, bylaw services, building inspection and enforcement of the building code to ensure the safety and rote ,tion of all citizens and their property.

Public works services

Public works includes construction and maintenanc removal, sidewalk repairs, street lighting and maint

Social and family services

Social services for assistance or service

Recreation and culture services

Recreation and cultural s facilities and parks, Q,

Segmented information

ecreation programs, maintenance and rental of useum and library services.

number of services including municipal planning and lans.

provided in the following pages.

Page 26

Planning and de· .

- 124 -



19. Segmented information (continued)

Protection

to persons

and ro ert

$

Revenue Grants 56,957

User charges 7,104,411 Tax related revenues

Developer revenue 1,011,037

Contributed tangible

capital assets

Equity share of Veridian Corporation

Other revenues

Expenses

Salaries and wages

Materials and supplies

Contracted services

Amortization

Other

Loss on disposal of

tangible capital assets {17,671)

24,743,498

Annual ( deficit) surplus (15,594,203)

Public works

services

$

3,111,935

35,961

120,498

16,301,324

(8,341,829)


2018

Social and

family General

services overnment Consolidated

$ $ $

107,487 116,304 5,554,251

58,984 821,329 15,190,523

72,165,112 72,165,112

2,475 1,138,128 8,565,040

484,871 995,033

5,050,712 5,050,712 3,838,287 4,889,210

10,173,859 1,343,543 168,946 83,614,743 112,409,881

16,103,489 2,541,302 347,132 9,688,495 54,594,930

6,492,757 203,914 137,433 5,160,551 17,623,493

739,832 292,664 137,692 1,073,558 4,000,456

4,571,384 2,359 894,907 12,4:80,087

773,469 9,845 158,593 248,231 1,820,636

93,412 49,766 246,005

28,774,343 3,050,084 780,850 17,115,508 90,765,607

(18,600,484) (1,706,541) (611,904) 66,499,235 21,644,274

Page 27

g

- 125 -



December 31, 2018

19. Segmented information (continued)

Protection to persons Public works

and property services

$ $

Revenue Grants 9,877 5,489,553 User charges 3,848,727 45,432 Tax related revenues Developer revenue 199,275 Contributed tangible

capital assets Equity share of

Veridian Corporation Gain (loss) on disposal of

tangible capital assets Other revenues

Expenses Salaries and wages Materials and supplies Contracted services Amortization 6,042,866 Other 170 001 226 389

23,979,527 15,920,456 Annual (deficit) surplus (18,735,825) (3,826,952)

Recreational and cultural

31,646 597 655

7 742 112

15,744,394 6,481,518

731,558 3,480,211

752 499 27,190,180

(19,448,068)

Planning and development

$

54 598 784 140

2,220,477 214,166 136,700

2,065 9 845

2,583,253 (1,799,113)

Social and family

services

$

159,605 54,457

214 062

349,285 149,187 90,440

176 796 765,708

(551,646)


2017

General government Consolidated

$ $

114,264 6,356,344 765,965 11,082,163

69,270,028 69,270,028 86,468 1,468,880

5,014,463

4,179,608 4,179,608

22,883,018 22,927,289 2 495 839 5 573 935

99 795 190 125 872 710

9,692,750 52,853,051 4,817,022 17,462,408

990,566 4,031,472 543,558 10,800,559 254 592 1 590 122

16,298,488 86,737,612 83,496,702 39,135,098

Page 28

- 126 -


Financial statements of


Trust Funds

December 31, 2018

- 127 -


The Corporation of the City of Pickering Trust Funds December 31, 2018

Table of contents

Independent Auditor's Report ............................................................................................................................ 1-2

Statement of financial activities and fund balances .............................................................................................. 3

Statement of financial position .............................................................................................................................. 4

Notes to the financial statements ... ...................................................................................................................... 5

- 128 -

Deloitte.


To the Members of Council of The Corporation of the City of Pickering

Opinion

DRAFb�Sit£h<il.f'i/29/2019 400 Applewood Crescent Suite 500 Vaughan ON L4K 0C3 Canada


We have audited the financial statements of The Corporation of the City of Pickering Trust Funds (the "Trust Funds"), which comprise the statement of financial position as at December 31, 2018, and the statement of financial activities and fund balances for the year thenended, and notes to the financial statements, including a summary of significant accounting policies (collectively referred to as the "financial statements").

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Trust Funds as at December 31, 2018, and the results of its operations changes in fund balances for the year then ended in accordance with Canadian accounting standards for Not-for-Profit Organizations.

Basis for Opinion We conducted our audit in accordance with Canadian genera Uy; accepted auditing standards ("Canadian GAAS"). Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Audit of the FinancialStatements" section of our report. We are independent of the Trust Funds in accordance with the ethical requirements that are relevant to our.audit of the financial statements in Canada, and We have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with Canadian accounting standards for Not-for-Profit Organizations, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Trust Funds' ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Trust Funds or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Trust Funds' financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

- 129 -



• Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resulting from error,as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the overrideof internal control.

• Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the Trust Funds' internal control.


• Conclude on the appropriateness of management's use of the going concern basis of accountingand, based on the audit evidence obtained, whether a material uncertainty exists related to eventsor conditions that may cast significant doubt on the Trust Funds' ability to continue as a goingconcern. If we conclude that a material uncertainty exists, we are required to draw attention inour auditor's report to the related disclosures in the financial statements or, if such disclosures areinadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up tothe date of our auditor's report. However, future events or conditions may cause the Trust Fundsto cease to continue as a going concern.

• Evaluate the overall presentation, structure and content ofthe financial statements, including thedisclosures, and whether the financial statements representthe underlying transactions andevents in a manner that achieves fair presentatio11.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

(To be signed Deloitte LLP)

Chartered Professional Accountants Licensed Public Accountants ______ , 2019

- 130 -


The Corporation of the City of Pickering Trust Funds Statement of financial activities and fund balances year ended December 31, 2018

Revenue Interest

Fund balance, beginning of year Fund balance, end of year

2018

$

5,885 361,263 367,148

2017 $

6,114 355,149 361,263

The accompanying notes to the financial statements are an integral part of this financial statement. Page 3

- 131 -


The Corporation of the City of Pickering Trust Funds Statement of financial position as at December 31, 2018

2018 2017

$ $

Assets Cash and investments 356,700 356,700 Interest receivable 10,448 4,563

367 148 361 263

Trust Fund eosition 3671148 361

1263

The accompanying notes to the financial statements are an integral part of this financial statement. Page4

-------------------------------------------------

- 132 -


The Corporation of the City of Pickering Trust Funds Notes to the financial statements

December 31, 2018


The financial statements of The Corporation of the City of Pickering Trust Funds are the representationsof management prepared in accordance with Canadian accounting standards for Not-for-ProfitOrganizations.

Significant accounting policies adopted include:

Revenue recognition

Interest revenue is recorded as earned.

Investments

Investments are recorded at amortized cost. The cost of investments plus accrued interest approximatestheir fair value.

2. Dorothy Card Estate

The City of Pickering administers a trust fund for the D6destitute elderly. The fund balance is comprised of inve$367,148 (2017- $361,263).

3. Statement of cash flows

A statement of cash flows has not been present§ .. financial statements presented. /ff

'.ef

te for the care and upkeep of the ul interest amounting to

Page 5

·s readily determinable from the

- 133 -

Financial statements of

City of Pickering

Public Library Board

December 31, 2018


- 134 -

City of Pickering Public Library Board December 31, 2018

Table of contents


Independent Auditor's Report ........................................................................................................................... 1-2

Statement of financial position .............................................................................................................................. 3

Statement of operations ........................................................................................................................................ 4

Statement of change in net debt ..................................................................................................... : ..................... 5

Statement of cash flows .................................................................. , ...................................................................... 6

Notes to the financial statements ................................................... ,, ..... , ........................ , .................................. 7-11

- 135 -

Deloitte.


To the Board of Directors of The City of Pickering Public Library Board, and Members of Council of the Corporation of the City of Pickering

Opinion

DRAFo�SitfreLID_p/29/2019 400 Applewood Crescent Suite 500 Vaughan ON L4K 0C3 Canada


We have audited the financial statements of City of Pickering Public Library Board (the "Library Board"), which comprise the statement of financial position as at December 31, 2018, and the statements of operations, change in net debt and cash flows for the year then ended, and notes to the financial statements, including a summary of significant accou"nting policies (collectively referred to as the "financial statements").

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Library Board as at December 31, 2018, and the results of its operations, changes in net debt, and its cash flows for the year then ended in accordance with Canadian public sector accounting standards ("PSAS").

Basis for Opinion We conducted our audit in accordance with Canadian generally accepted auditing standards ("Canadian GAAS"). Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Audit of the Financial'Statements" section of our report. We are independent of the Library Board in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a ba_sis for our opinion.

. .

Responsibilities of Management and·Those charged with governance for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with PSAS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Library Board's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Library Board or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Library Board's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free. from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian GAAS will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

- 136 -



• Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resulting from error,as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the overrideof internal controL

• Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the Library Board's internal control.


• Conclude on the appropriateness of management's use of the going concern basis of accountingand, based on the audit evidence obtained, whether a material uncertainty exists related to eventsor conditions that may cast significant doubt on the Library Board's ability to continue as a goingconcern. If we conclude that a material uncertainty exists, we are required to draw attention inour auditor's report to the related disclosures in the financiaLstatements or, if such disclosures areinadequate, to modify our opinion. Our conclusions are ba.sed on the audit evidence obtained up tothe date of our auditor's report. However, future events or conditions may cause the Library Boardto cease to continue as a going concern.

• Evaluate the overall presentation, structure and content ofthe financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions andevents in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

(To be signed Deloitte LLP)

Chartered Professional Accountants Licensed Public Accountants _____ , 2019

- 137 -


City of Pickering Public Library Board Statement of financial position as at December 31, 2018

Financial assets

Cash

Accounts receivable

Due from the Government of Canada

Due from City of Pickering

Liabilities

Accounts payable and accrued liabilities

Deferred Revenue

Post-employment benefits liability (Note 2)

Net debt

Non-financial assets

Tangible capital assets (Note 4)

Prepaid expense

Accumulated sur lus Note 5

2018

$

1,225

2,294

11,335

138,181

153,035

198,723

1,494,063

45,688

1,539,751

1,029,985

2017

$

1,225

1,333

14,927

162,706

180,191

,202,851

14,793

452,568

670,212

(490,021)

1,494,740

37,453

1,532,193

1,042,172


- 138 -


City of Pickering Public Library Board Statement of operations year ended December 31, 2018

2018 2017 Budget

(Note 6)

$ $ $

Revenue

City of Pickering grants 5,964,138 5,882,770 5,781,879 Federal grants 9,234

Province of Ontario grants 138,050 138,049 210,280 Fines and other receipts 176,500 136,720 152,398

6,278,688 6,166,773 6,144,557

Expenses Operating

Salaries Salaries and wages 3,483,038 Fringe benefits 970,148

4,453,186

Material, supplies and utilities Books 234,355 208,582 Utilities 219,266. 227,402 Other supplies 52,556 54,963

506,177 490,947

Services Repairs and maintenance 22,533 284,079 394,908 Insurance 25,918 23,918 25,918 Travel 6,000 7,358 7,308 Consulting and prof 103,850 112,978 41,951 Advertising 23,500 27,107 20,782 Conference 10,000 13,106 15,594 Postage 2,800 2,823 3,078 Telephone 70,466 65,597 60,431 Seminars and education 17,500 18,602 32,187 Software/hardware maintenance 115,785 150,008 123,405 Vehicle repairs and maintenance 5,143 3,816 3,527 Minor capital purchases 46,000 119,775 79,757 Miscellaneous 15,230 20,636 21,950

764,725 849,803 830,796

Amortization of tangible capital assets 463,283 466,629 473,083 6,391,027 6,178,960 . 6,248,012

Annual deficit (112,339) (12,187) (103,455) Accumulated surplus, beginnin� of year 1,042,172 1,042,172 1,145,627 Accumulated suq;?lus, end of :z:ear 929,833 1,029,985 1,042,172

The accompanying notes to the financial statements are an integral part of this financial statement. Page4

3,440,087 916,264

- 139 -


City of Pickering Public Library Board Statement of change in net debt year ended December 31, 2018

Annual deficit

Acquisition of tangible capital assets

Amortization of tangible capital assets

Acquisition of prepaid expenses

Usage of prepaid expenses Change in prepaid expense

Change in net debt

Net debt, beginning of year

Net debt, end of ear

Budget

(Note 6)

$

(112,339)

(420,944)

463,283

42,339

2018 2017

$ $

(12,187) (103,455)

(465,952) (440,096)

466,629 473,083

677 32,987

(45,688) (37,453)

37,453 80,195

(8,235) 42,742

(27,726)

(462,295) 490,021)


- 140 -


City of Pickering Public Library Board Statement of cash flows year ended December 31, 2018

Operating transactio.ns

Annual deficit Non-cash items

Amortization of tangible capital assets

Change in non-cash operating items

Increase in accounts receivable Decrease in due from Government of Canada Decrease (increase) in due from City of Pickering Decrease in accounts payable and accrued liabilities (Decrease) increase in deferred revenue

Increase in post-employment benefits liability (Increase) decrease in prepaid expense

Capital transactions Net acquisition of tangible capital assets

Net change in cash Cash, beginning of year

2018

$

(12,187)

466,629

454,442

(961)

3,592

24,525

(4,128)

(14,793)

11,510

8,235)

1,510

465,952

(465,952)

1,225

1,225

2017

$

(103,455)

473,083 369,628

(962)

477

(53,627) (4,423)

14,793

70,468 42,742 69,468

439,096

(440,096)

(1,000) 2,225 1,225

TThe accompanying notes to the financial statements are an integral part of this financial statement. Page 6

Cash, end of ear

- 141 -


City of Pickering Public Library Board Notes to the financial statements

December 31, 2018


The financial statements of the City of Pickering Public Library Board (the "Library Board") are therepresentations of management prepared in accordance with Canadian public sector accountingstandards established by the Public Sector Accounting Board ("PSAB") of Chartered ProfessionalAccountants of Canada.

Significant accounting policies adopted by the Library Board are as follows:

Basis of accounting

a) Accrual basis of accounting

Revenues and expenses are reported on the accrual basis of accounting. The accrual basis ofaccounting recognizes revenues as they are earned and measurable; expenses are recognized, asthey are incurred and measurable as a result of the receipt of goods and services and the creation ofa legal obligation to pay.

b) Non-financial assets

(i) Tangible capital assets

Tangible capital assets are recorded at cost lesamounts that are directly attributable to acquisitThe cost of the tangible capital asset is amo ized onuseful life as follows:

Machinery and equipmentInformation technology hardwareLibrary collection materialsFurniture and fixtures

One-half of the annual amodisposal.

Other majo these fina

uildings are owned by the City and are not reflected in

(ii)

ved as contributions or donations are recorded at their fair value at at fair value is also recorded as revenue.

(iii) Intangible assets

Intangible assets are not recognized as assets in the financial statements.

c) Post-employment benefits

The present value of the cost of providing employees with future benefits programs is recognized asemployees earn these entitlements through service. Any actuarial gains or losses are amortized on astraight-line basis over the average remaining service period (ARSP) of employees. The actuaryestimated the ARSP to be 13 years for retirement and 12 years for sick leave benefits.

d) Government transfers

Government transfers are recognized as revenue by the Library Board in the period in which thetransfer is authorized and any eligibility criteria are met, unless they are restricted throughstipulations that require specific actions to be carried out in order to keep the transfer. For suchtransfers, revenue is recognized as the stipulation has been met.

Page7

Tangible capital as the date of receipt, an /

- 142 -



December 31, 2018

1. Significant accounting policies (continued)

Basis of accounting (continued)

e) Use of estimates

The preparation of financial statements in conformity with Canadian public sector accountingstandards requires management to make estimates and assumptions that affect the reported amountof assets, liabilities and the disclosure of contingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during the period. Actual resultscould differ from those estimates. Balances which require significant estimates include amortizationexpense of tangible capital assets, which are based on estimated useful lives, and post-employmentbenefits.

2. Post-employment benefits liability

The Library Board makes available to qualifying employees wopportunity to continue their coverage for benefits suchbenefits. Coverage ceases at the age of 65. The Librapart-time employees a sick time entitlement, with any uaccumulated entitlement is not vested and therefore is fThe post-employment benefits obligation at Decemberobligation for the 2018 fiscal year was determined b actuaria2017, with projection to December 31, 2018.

Information about the Library Board's post-em,pJgs�

Accrued post-employment benefits obligation Unamortized actuarial gains Post-employment benefits liability

ret[I:,jlefore the age of 65 the -�v ment extended healthcare

vides full-time and permanent lated year to year. This

rement or termination. and the s in the accrued benefit

ation prepared as at December 31,

y is as follows:

2018 2017 $ $

452,568 382,100 30,062 44,147

(262) 18,90013,157 19,458

(31,447) (12,037) 464,078 452,568

2018 2017 $ $

363,305 351,533 100,773 101,035 464,078 452,568

The main actuarial assumptions employed in the actuarial valuation are as follows:

a) Discount rate

The present value as at December 31, 2018 of the future benefits was determined using a discountrate of 3.75% (2017 - 3.75%).

b) Dental cost

The dental cost trend rate was 3. 75% (2017 - 3.75%) per annum.

Page 8

Post-employment benefi Current service cost Amortization of a

- 143 -


December 31, 2018

2. Post-employment benefits liability (continued)

c) Health costs


Health costs were assumed to increase at 6.42% (2017 - 6.75%) and decrease by 0.33%(2017 - 0.33%) increments per year to an ultimate rate of 3. 75% per year in 2027 and thereafter.

3. Pension agreement

The Library Board makes contributions to the Ontario Municipal Employees Retirement Fund (OMERS),which is a multi-employer plan, on behalf of eligible members of its staff. The Plan is a defined benefitplan that specifies the amount of the retirement benefit to be received by the employees based on thelength of service and rates of pay.

OMERS provide pension services to over 496,000 active and retired members and about 1,000employers. Each year an independent actuary determines the funding status of OMERS PrimaryPension ("the Plan") by comparing the actuarial value of the i. sets to the estimated present value of all pension benefits that members have earned ost recent actuarial valuation of the Plan was conducted as at December 31, 2018. Th aluation disclosed total actuarial liabilities as at that date of $100,081 million in respect assets at that date of $95,890 million indicating an actu a multi-employer plan, any pension plan surpluses or de municipal organizations and their employers. As a result, the share of the OMERS pension surplus or deficit.

Contributions in the amount of $288,959 (201 members during the year.

4. Tangible capital assets (TCA)

Furniture

and

Assets

under

materials fixtures construction 2018

Cost Balance, beginning

of year Additions during

the year Disposals/transfers to

TCA during the year Balance, end of year

Accumulated amortization Balance, beginning

of year Amortization Accumulated

amortization on disposals

Balance, end of year Net book value

23,681

10,546

2,368

12,914

10,767

$ $ $ $

255,350 2,358,369 350,759

46,498 366,812 72,932

474,319

301,848 2,250,862 423,691

129,978 1,224,942 148,243

41,741 4,05,060 17,460

474,319

171,719 1,155,683 165,703

130,129 1,095,179 257,988

20,290 3,008,449

486,242

20,290 494,609

3,000,082

1,513,709

466,629

474,319

1,506,019

1,494,063

Page 9

Library collection

- 144 -


December 31, 2018

4. Tangible capital assets (TCA) (continued)

Cost

Balance, beginning

of year Additions during

the year

Disposals/transfers to

TCA during the year Balance, end of year


Balance, beginning

of year

Amortization

Accumulated

amortization on disposals

Balance, end of year

Net book value

5. Accumulated sur

Accumulated surplus

Machinery and

egui�ment

$

23,681

23,681

8,178 2,368

Invested in tangible capital assets

Post-employment benefits liability

Information

technology

hardware

$

204,157

51,193

255,350

Library Furniture

collection and

materials fixtures

$ $

2,466,112 329,648

347,502 21,111

148,243 202,516


Assets

under

construction

$

-

20,290

20,290

20,290

2018

$

1,494,063

(464,078)

1,029,985

2017

$

3,023,598

440,096

455,245 3,008,449

1,495,871 473,083

455,245 1,513,709 1,494,740

2017

$

1,494,740 (452,568)

1,042,172

Page 10

2 .~~a1o69'7efti~5'o, 7 59 ----------------------' ----'-----------

- 145 -



December 31, 2018

6. Budget figures

The 2018 budget was not prepared on a basis consistent with that used to report actual results. Thebudget was prepared on a modified accrual basis while Canadian public sector accounting standardsrequire a full accrual basis of accounting. The budget figures treated all tangible capital asset (TCA)acquisitions as expenditures and did not include amortization expense on tangible capital assets or postemployment benefits expenses on a full accrual basis. The following provides a reconciliation from theapproved budget to the budget numbers presented in the financial statements.

Revenue

City of Pickering

Federal and

provincial grants

Fines and other receipts

Expenditures

Salaries and benefits

Material, supplies

and utilites

Services

Amortization

Annual surplus (defic

Capital expenditures/

additions

2018 Council approved

budget

$

5,857,744

450,944

(450,944)

Post-employment benefits /

Amortization/ City Assets

$

(30,000)

(30,000)

70,000

463,283 533,283

(563,283)

30,000

2018 budget presented in

statements

$

5,964,138

138,050 176,500

6,278,688

4,590,741

572,278 764,725 463,283

6,391,027

(112,339)

(420,944)

Page 11

- 146 -

-C�of

Pl(KER]NG



Report Number: FIN 09-19 Date: June 17, 2019

Subject: Investment Portfolio Activity for the Year Ended December 31, 2018 Ontario Regulation 438/97 under the Municipal Act, 2001

Recommendation: It is recommended that report Fl N 09-19 of the Director, Finance & Treasurer regarding Investment Portfolio Activity for the Year Ended December 31, 2018 be received for information.

Executive Summary: The following report and attachments represent a summary of the investment activity and year end balance in the portfolio. Investment activity for the year 2018 was based on a portfolio of approximately $165.5 million. Current Fund investments are limited to one year or less and Reserve Funds to 10 years or less under the Council approved policy. Overall returns on the City's portfolio compare favourably to market benchmarks.

Financial Implications: Total investment income, including bank account interest for 2018 was $2.85 million (2017 - $1.77 million) of which $1.30 million (2017 - $751,000) was for Current (Operating) Funds. The balance of the income was allocated to the various reserve funds.

Discussion: The City's investment portfolio is comprised of two main components:

(i) Reserve Funds; and

(ii) Balances available in the Current Fund, when not required to meet currentoperating expenditures. This latter balance can vary greatly depending uponmany factors including the timing of the receipt of property taxes and levypayments to the School Boards and the Region.

Investments are undertaken as one consolidated pool of funds and interest earned is credited back to the appropriate funds.

- 147 -

FIN 09-19 June 17, 2019

Subject: Investment Portfolio Activity for the Year Ended December 31, 2018 Page 2 Ontario Regulation 438/97 under the Municipal Act, 2001

The Treasurer of the City of Pickering is required under Provincial Regulation 438/97 to report certain information and opinions to Council. The schedules to this report are included as part of that Regulation's information requirements. The portfolio balance at December 31, 2018 of $165.5 million (2017 - $164.1 million) has increased nominally over the prior year.

The return on the portfolio maintained with Nesbitt Burns increased in 2018 with a weighted yearly rate of return of 1.56 per cent (2017 - 0.89 per cent) on the combined short-term and long-term investments. This was a result of a steady increase in interest rates throughout 2018.

The net performance on TD Wealth's portion of the portfolio for 2018 was 1.79 per cent (2017 - 1.83 per cent). This slight increase is attributed to the types of investments being held. The portion of the portfolio invested with TD Wealth primarily consists of one year Guaranteed Investment Certificates (GIG). Interest rates are higher than the interest rates for Banker's Acceptances and the one year term protects the City from fluctuations in interest rates, but GIC's are less liquid than these other investment instruments.

Investment parameters are narrow due to the Municipal Act and regulations limiting the selection of qualified investments for municipal entities. Furthermore, staff's approach tends to be conservative, given that they are investing public money. Notwithstanding these restrictions, the annual returns from both Nesbitt Burns and TD Wealth outperformed the annual returns for the CIBC World Markets 91-Day T-Bill Index (1.15 per cent) and the Morningstar Canadian Money Market Mutual Fund Index (1.20 per cent). These indices are deemed to be comparative benchmarks for reviewing the portfolio's performance and are considered the standard for analysis of investment funds in the industry.

The average return on interfund investments (internal loans) was 2.42 per cent (2017 -2.32 per cent).

At year end 2018, the total portfolio of approximately $165.5 million, consisted of approximately $63.8 million or 38.5 per cent in external long-term investments and approximately $2.0 million or 1.2 per cent in interfund investments (internal loans). The balance of approximately $99. 7 million is short-term investments due within the year.

All investments were made in accordance with the Investment Policy approved by Council. In the future, staff will be considering the inclusion of credit unions in the pool of investment options, that meet the investment criteria as stated in Ontario Regulation 438/97.

- 148 -

FIN 09-19 June 17, 2019

Subject: Investment Portfolio Activity for the Year Ended December 31, 2018 Page 3 Ontario Regulation 438/97 under the Municipal Act, 2001

Attachments:

1. Investment Activities for 20182. Outstanding Investments as at December 31, 20183. Portfolio Performance Review - Correspondence from BMO Nesbitt Burns4. Portfolio Performance - Correspondence from TD Wealth

Prepared By:

#�� Kristine Senior Manager, Accounting Services


Chief Administrative Officer


Stan Karwowski Director, Finance & Treasurer

- 149 -

CITY OF PICKERING INVESTMENT ACTIVITIES FOR 2018

Financial Purchase Maturity

Institution Instrument Cost Principal Yield Term Date Date

Short Term

Nesbitt Burns Toronto Dominion Bank Bdn Discount Note 7,474,050 7,500,000 1.196% 106 25-Sep-17 9-Jan-18Firstbank Bankers Acceptance 5,373,318 5,389,000 1.158% 92 4-Oct-17 4-Jan-18Firstbank Bankers Acceptance 7,170,784 7,192,000 1.200% 90 10-Oct-17 8-Jan-18Firstbank Bankers Acceptance 3,689,714 3,700,000 1.183% 86 25-Oct-17 19-Jan-18Firstbank Bankers Acceptance 6,397,971 6,416,000 1.143% 90 24-Nov-17 22-Feb-18Bank of Nova Scotia Bankers Acceptance 6,263,476 6,281,000 1.122% 91 27-Nov-17 26-Feb-18Bank of Nova Scotia Bankers Acceptance 6,036,475 6,053,000 1.148% 87 1-Dec-17 26-Feb-18Bank of Nova Scotia Bankers Acceptance 8,401,002 8,424,000 1.148% 87 1-Dec-17 26-Feb-18Toronto Dominion Bank Bankers Accept. 6,049,978 6,068,000 1.236% 88 4-Dec-17 2-Mar-18Toronto Dominion Bank Bankers Accept. 6,306,706 6,326,000 1.241% 90 5-Dec-17 5-Mar-18Firstbank Bankers Acceptance 7,701,593 7,725,000 1.233% 90 27-Dec-17 27-Mar-18Firstbank Bankers Acceptance 14,999,052 15,038,000 1.231% 77 28-Dec-17 15-Mar-18Toronto Dominion Fixed Rate Deposit Note 10,065,202 10,026,000 2.171% 181 3-Oct-17 2-Apr-18Bank of Nova Scotia 10,008,891 10,015,000 1.330% 210 3-Oct-17 1-May-18Firstbank Bankers Acceptance 5,431,509 5,449,000 1.336% 88 4-Jan-18 2-Apr-18Firstbank Bankers Acceptance 7,191,335 7,215,000 1.397% 86 8-Jan-18 4-Apr-18Toronto Dominion Bank Bankers Accept. 7,538,749 7,565,000 1.428% 89 17-Jan-18 16-Apr-18Firstbank Bankers Acceptance 3,699,305 3,712,000 1.392% 90 19-Jan-18 19-Apr-18Firstbank Bankers Acceptance 6,453,917 6,476,000 1.403% 89 22-Feb-18 22-May-18Royal Bank of Canada Bankers Acceptance 6,808,196 6,833,000 1.461% 91 26-Feb-18 28-May-18CIBC Bankers Acceptance 6,974,590 7,000,000 1.461% 91 26-Feb-18 28-May-18Bank of Nova Scotia Bankers Acceptance 6,974,590 7,000,000 1.461% 91 26-Feb-18 28-May-18Firstbank Bankers Acceptance 6,453,917 6,476,000 1.403% 89 22-Feb-18 22-May-18Firstbank Bankers Acceptance 6,067,528 6,090,000 1.438% 94 2-Mar-18 4-Jun-18Firstbank Bankers Acceptance 6,327,077 6,350,000 1.437% 62 5-Mar-18 6-May-18Firstbank Bankers Acceptance 7,604,754 7,632,000 1.453% 90 15-Mar-18 13-Jun-18

� Firstbank Bankers Acceptance 7,605,445 7,633,000 1.453% 91 15-Mar-18 14-Jun-18Firstbank Bankers Acceptance 7,760,680 7,787,000 1.491% 83 29-Mar-18 20-Jun-18 ;;! Bank of Nova Scotia 1/4 Bankers Acceptance 5,979,480 6,000,000 1.456% 86 4-Apr-18 29-Jun-18 n

Firstbank Bankers Acceptance 5,431,431 5,451,000 1.461% 90 4-Apr-18 3-Jul-18Firstbank Bankers Acceptance 5,431,158 5,451,000 1.465% 91 4-Apr-18 4-Jul-18 m Firstbank 1/4 Bankers Acceptance 5,977,920 6,000,000 1.465%. 92 4-Apr-18 5-Jul-18 z

Bank of Nova Scotia Bankers Acceptance 7,599,319 7,628,000 1.514% 91 16-Apr-18 16-Jul-18 -I Toronto Dominion Bank Bankers Accept. 3,711,599 3,724,000 1.452% 84 19-Apr-18 12-Jul-18 :it Firstbank Bankers Acceptance 5,131,254 5,150,000 1.482% 90 1-May-18 30-Jul-18

� Firstbank Bankers Acceptance 4,882,801 4,900,000 1.478% 87 1-May-18 27-Jul-18Firstbank Bankers Acceptance 6,621,476 6,646,000 1.519% 89 23-May-18 20-Aug-18 -I Royal Bank of Canada Bankers Acceptance 3,986,160 4,000,000 1.457% 87 28-May-18 23-Aug-18 0 CIBC Bankers Acceptance 7,074,369 7,100,000 1.453% 91 28-May-18 27-Aug-18 ;,o Bank of Nova Scotia Bankers Acceptance 9,771,808 9,808,000 1.486% 91 28-May-18 27-Aug-18Firstbank Bankers Acceptance 6,349,779 6,374,000 1.530% 91 5-Jun-18 4-Sep-18 0 Firstbank Bankers Acceptance 6,114,246 6,138,000 1.541% 92 5-Jun-18 5-Sep-18 q Firstbank Bankers Acceptance 7,696,039 7,724,000 1.490% 89 13-Jun-18 10-Sep-18 :it Bank of Nova Scotia Bankers Acceptance 7,697,337 7,726,000 1.494% 91 14-Jun-18 13-Sep-18

f;' Bank of Nova Scotia Bankers Acceptance 5,450,052 5,467,000 1.474% 77 3-Jul-18 18-Sep-18Bank of Nova Scotia Bankers Acceptance 7,786,612 7,816,000 1.531 % 90 20-Jun-18 18-Sep-18 --<'.:..-

\ -...a

m '"O

- 150 -


Financial Purchase Maturity

Institution Instrument Cost Principal Yield Term Date Date

Firstbank Bankers Acceptance 5,999,505 6,021,000 1.469% 89 29-Jun-18 26-Sep-18Firstbank Bankers Acceptance 19,379,494 19,402,000 1.514% 28 30-Aug-18 27-Sep-18Firstbank Bankers Acceptance 5,999,450 6,023,000 1.628% 88 5-Jul-18 1-Oct-18Bank of Montreal Bankers Acceptance 5,494,212 5,516,000 1.626% 89 5-Jul-18 2-Oct-18Firstbank Bankers Acceptance 1,069,693 1,074,000 1.651% 89 12-Jul-18 9-Oct-18Firstbank Bankers Acceptance 3,784,572 3,800,000 1.653% 90 12-Jul-18 10-Oct-18Royal Bank of Canada Bankers Acceptance 7,651,958 7,684,000 1.698% 90 17-Jul-18 15-Oct-18Bank of Nova Scotia Bankers Acceptance 4,915,861 4,936,000 · 1.661% 90 27-Jul-18 25-Oct-18Bank of Nova Scotia Bankers Acceptance 5,150,161 5,171,000 1.641% 90 31-Jul-18 29-Oct-18Firstbank Bankers Acceptance 6,645,574 6,673,000 1.693% 89 22-Aug-18 19-Nov-18Firstbank Bankers Acceptance 3,999,414 4,016,000 1.701% 89 23-Aug-18 20-Nov-18Firstbank Bankers Acceptance 6,373,248 6,400,000 1.702% 90 4-Sep-18 3-Dec-18Firstbank Bankers Acceptance 6,138,543 6,164,000 1.701% 89 6-Sep-18 4-Dec-18Firstbank Bankers Acceptance 7,723,192 7,756,000 1.704% 91 10-Sep-18 10-Dec-18Toronto Dominion Bank Bankers Accept. 7,725,507 7,757,000 1.691% 88 13-Sep-18 10-Dec-18Bank of Nova Scotia Bankers Acceptance 4,999,368 5,020,000 1.674% 90 19-Sep-18 18-Dec-18Firstbank Bankers Acceptance 6,027,005 6,052,000 1.701% 89 26-Sep-18 24-Dec-18Firstbank Bankers Acceptance 19,401,839 19,453,000 1.604% 60 27-Sep-18 26-Nov-18Firstbank Bankers Acceptance 19,452,799 19,475,000 1.736% 24 27-Nov-18 21-Dec-18Royal Bank Of Canada 4,942,868 4,915,000 2.980% 225 24-Sep-18 7-May-19Toronto Dominion Bank Dep. Note 3,370,646 3,361,000 2.447% 190 24-Sep-18 2-Apr-19

· Firstbank Bankers Acceptance 6,022,324 6,049,000 1.738% 93 1-Oct-18 2-Jan-19Firstbank Bankers Acceptance 5,515,569 5,540,000 1.738% 93 2-Oct-18 3-Jan-19Firstbank Bankers Acceptance 1,073,623 1,078,000 1.771% 84 12-Oct-18 4-Jan-19Firstbank Bankers Acceptance 3,799,629 3,816,000 1.808% 87 12-Oct-18 7-Jan-19Toronto Dominion Bank Bankers Accept. 7,784,345 7,819,000 1.817% 92 15-Oct-18 15-Jan-19Firstbank Bankers Acceptance 4,938,331 4,962,000 1.922% 91 25-Oct-18 24-Jan-19Toronto Dominion Bk Bdn Disc. Note 5,170,592 5,196,000 1.929% 93 29-Oct-18 30-Jan-19Toronto Dominion Bank Bankers Accept. 5,438,823 5,465,000 1.952% 90 21-Nov-18 19-Feb-19Bank of Nova Scotia Bankers Acceptance 5,438,889 5,466,000 1.956% 93 21-Nov-18 22-Feb-19Firstbank Bankers Acceptance 6,399,298 6,429,000 1.970% 86 3-Dec-18 27-Feb-19Firstbank Bankers Acceptance 6,163,269 6,192,000 1.978% 86 4-Dec-18 28-Feb-19Toronto Dominion Bank Bankers Accept. 7,820,491 7,859,000 1.997% 90 11-Dec-18 11-Mar-19Bank of Nova Scotia Bankers Acceptance 7,820,151 7,857,000 2.000% 86 11-Dec-18 7-Mar-19Bank of Nova Scotia Bdn Disc. Note 5,073,860 5,097,000 2.030% 82 19-Dec-18 11-Mar-19Firstbank Bankers Acceptance 6,051,302 6,080,000 1.990% 87 24-Dec-18 21-Mar-19

T-D Wealth Royal Bank Of Canada GIC 2,097,480 2,097,480 1.300% 365 26-Jan-17 26-Jan-18Royal Bank Of Canada GIC 2,071,618 2,071,618 1.250% 365 23-Feb-17 23-Feb-18

.TD MTGGIC 2,148,679 2,148,679 1.410% 367 25-Aug-17 27-Aug-18Royal Bank Of Canada GIC 2,124,747 2,124,747 1.850% 367 26-Jan-18 28-Jan-19Royal Bank Of Canada GIC 2,097,513 2,097,513 1.850% 367 23-Feb-18 25-Feb-19Royal Bank Of Canada GIC 2,179,141 2,179,141 2.150% 365 27-Aug-18 27-Aug-19

Total Short-term 564,997,223 566,767,178

- 151 -


Financial Purchase Maturity Institution Instrument Cost Principal Yield Term Date Date Long Term Nesbitt Burns CIBC Senior Deposit Note 1,890,580 1,908,000 1.660% 727 23-Jan-18 20-Jan-20

Bank Of Nova Scotia 5 Yrs. Senior Dep. Note 1,955,045 1,952,000 2.270% 671 13-Mar-18 13-Jan-20Province Of Ontario 1,961,809 1,951,000 2.100% 544 13-Mar-18 8-Sep-19Royal Bank Of Canada 3,146,255 3,135,000 2.350% 623 26-Mar-18 9-Dec-19Bank Of Montreal Fixed Rate Dep. Note 1,842,607 1,832,000 2.840% 631 12-Sep-18 4-Jun-20Bank Of Nova Scotia 7 Yrs. Senior Dep. Note 2,696,047 2,662,000 3.270% 851 13-Sep-18 11-Jan-21CIBC Deposit Note 3,920,425 4,008,000 1.900% 924 15-Oct-18 26-Apr-21Bank Of Montreal Fixed Rate Dep. Note 3,649,702 3,684,000 2.100% 662 14-Dec-18 6-Oct-20Toronto Dominion Bank Dep. Note 2,729,146 2,733,000 2.621% 1,094 24-Dec-18 22-Dec-21Royal Bank Of Canada Sr. Dep. Note 2,478,472 2,497,000 1.920% 571 24-Dec-18 17-Jul-20Bank Of Nova Scotia 5 Yrs. Senior Dep. Note 2,484,711 2,502,0Q0 2.090% 625 24-Dec-18 9-Sep-20Bank Of Montreal Fixed Rate Dep. Note 2,487,941 2,505,000 2.100% 652 24-Dec-18 6-Oct-20CIBC Global Social Dep. Notes 2,708,251 2,694,000 2.900% 995 24-Dec-18 14-Sep-21Royal Bank Of Canada Sr. Dep." Note 2,485,531 2,516,000 2.030% 812 24-Dec-18 15-Mar-21CIBC Deposit Note 1,984,265 2,036,000 1.640% 931 24-Dec-18 12-Jul-21Bank Of Montreal Deposit Note 1,993,874 2,053,000 1.610% 1,039 24-Dec-18 28-Oct-21

Total Long-term 40,414,662 40,668,000

Total External Investments 605,411,885 607,435,178

lnterfund Investments (Internal Loans)

Total Investment Activity 607,435,178

Long Term Dispositions Bank of Nova Scotia Senior Dep. Notes 1,899,454 .1,892,000 2.370% 121 12-Sep-17 11-Jan-18 MaturedCdn Imperial Bk Of Commerce 1,497,976 1,482,000 2.220% 1,807 26-Mar-13 7-Mar-18 MaturedProvince of Ontario Debenture 2,641,622 2,444,000 4.200% 2,711 5-Oct-10 8-Mar-18 MaturedBank of Nova Scotia 5 Yr.Senior Dep. Notes 1,327,128 1,320,000 2.242% 1,745 11-Jun-13 22-Mar-18 MaturedBank of Nova Scotia 5 Yr. Senior Dep. Notes 1,890,060 1,848,000 2.242% 1,053 4-May-15 22-Mar-18 MaturedRSC Sr Dep Note 1,126,569 1,116,000 2.820% 265 20-Oct-17 12-Jul-18 MaturedBank of Nova Scotia Senior Dep. Notes 2,518,250 2,437,000 2.750% 970 17-Dec-15 13-Aug-18 MaturedProvince of Ontario Series DMTN218 2,791,841 2,712,000 2.100% 906 16-Mar-16 8-Sep-18 MaturedBank of Montreal Fixed Rate Dep. Note 1,938,875 1,857,000 3.210% 911 16-Mar-16 13-Sep-18 MaturedCIBC Deposit Note 3,995,264 3,957,000 1.700% 676 2-Dec-16 9-Oct-18 MaturedRoyal Bank of Canada 3,808,338 3,665,000 2.770% 1,058 18-Jan-16 11-Dec-18 Matured

Total Dispositions 25,435,378 24,730,000

- 152 -

CITY OF PICKERING OUTSTANDING INVESTMENTS AS AT DECEMBER 31, 2018

Financial Purchase Maturity Interest

Institution Instrument Cost Principal Yield Term Date Date Payable Dates

Short-term Current & Reserve Fund Investments

Nesbitt Burns Royal Bank of Canada 4,930,729.97 4,915,000.00 2.98% 225 24-Sep-18 7-May-19TD Deposit Note 3,365,670.73 3,361,000.00 2.45% 190 24-Sep-18 2-Apr-19Firstbank Bankers Acceptance 6,022,323.91 6,049,000.00 1.74% 93 1-Oct-18 2-Jan-19Firstbank Bankers Acceptance 5,515,568.60 5,540,000.00 1.74% 93 2-Oct-18 3-Jan-19Firstbank Bankers Acceptance 1,073,623.32 1,078,000.00 1.77% 84 12-Oct-18 4-Jan-19Firstbank Bankers Acceptance 3,799,629.36 3,816,000.00 1.81% 87 12-Oct-18 7-Jan-19TD Bankers Acceptance 7,783,345.36 7,819,000.00 1.82% 92 15-Oct-18 15-Jan-19Firstbank Bankers Acceptance 4,938,331.26 4,962,000.00 1.92% 91 25-Oct-18 24-Jan-19

TD Bond Discount Note 5,170,591.56 5,196,000.00 1.93% 93 29-Oct-18 30-Jan-19TD Bankers Acceptance 5,438,822.65 5,465,000.00 1.95% 90 21-Nov-18 19-Feb-19BNS Bankers Acceptance 5,438,888.64 5,466,000.00 1.96% 93 21-Nov-18 22-Feb-19Firstbank Bankers Acceptance 6,399,298.02 6,429,000.00 1.97% 86 3-Dec-18 27-Feb-19Firstbank Bankers Acceptance 6,163,269.12 6,192,000.00 1.98% 86 4-Dec-18 28-Feb-19TD Bankers Acceptance 7,820,490.90 7,859,000.00 2.00% 90 11-Dec-18 11-Mar-19BNS Bankers Acceptance 7,820,150.67 7,857,000.00 2.00% 86 11-Dec-18 7-Mar-19BNS Bond Discount Note 5,073,859.62 5,097,000.00 2.03% 82 19-Dec-18 11-Mar-19Firstbank Bankers Acceptance 6,051,302.40 6,080,000.00 1.99% 87 24-Dec-18 21-Mar-19

TD Wealth RBC GlC 2,124,747.00 2,164,270.20 1.85% 367 26-Jan-18 28-Jan-19

RBC GlC 2,097,513.00 2,136,529.62 1.85% 367 23-Feb-18 25-Feb-19

TD MTG GlC 2,179,141.00 2,225,992.53 2.15% 365 27-Aug-18 27-Aug-19

Total Short-term 99,207,297.09 99,707,792.35

Long-term Reserve Fund Investments

�Nesbitt Burns TD Deposit Note 1,795,585.45 1,790,000.00 2.45% 868 15-Nov-16 2-Apr-19 Apr 2 & Oct 2

ClBC Deposit Note 3,538,781.74 3,522,000.00 2.35% 927 9-Dec-16 24-Jun-19 Jun 24 & Dec 24BNS 5 yr Sr Deposit Note 3,569,574.98 3,543,000.00 2.40% 1053 9-Dec-16 28-Oct-19 Apr 28 & Oct 28 n

RBC 2,307,158.28 2,294,000.00 2.98% 788 10-Mar-17 7-May-19 May 7 & Nov 7Province of Alberta 2,442,797.85 2,439,000.00 2.00% 614 25-Sep-17 1-Jun-19 Jun 1 & Dec 1 mBNS Sr Dep Note 3,668,771.12 3,663,000.00 2.46% 455 14-Dec-17 14-Mar-19 Mar 14 & Sept 14Province of Ontario 1,846,898.77 1,825,000.00 4.40% 534 15-Dec-17 2-Jun-19 Jun 2 & Dec 2ClBC Sr Deposit Note 1,898,774.81 1,908,000.00 1.66% 727 23-Jan-18 20-Jan-20 Jan 20 & Jul 20

rBNS 5 yr Sr Deposit Note 1,953,715.43 1,952,000.00 2.27% 671 13-Mar-18 13-Jan-20 Jan 13 & Jul 13Province of Ontario 1,955,987.03 1,951,000.00 2.10% 544 13-Mar-18 8-Sep-19 Mar 8 & Sept 8RBC 3,141,196.38 3,135,000.00 2.35% 623 26-Mar-18 9-Dec-19 Jun 9 & Dec 9 a BMO Fixed Rate Deposit Note 1,840,758.15 1,832,000.00 2.84% 631 12-Sep-18 4-Jun-20 Jun 4 & Dec 4 ;:;o BNS 7 Yr Deposit Note 2,691,686.09 2,662,000.00 3.27% 851 13-Sep-18 11-Jan-21 Jan 11 & Jun 11

-oClBC Deposit Note 3,927,723.10 4,008,000.00 1.90% 924 15-Oct-18 26-Apr-21 Apr 26 & Oct 26

BMO Fixed Rate Deposit Note 3,650,582.73 3,684,000.00 2.10% 662 14-Dec-18 6-Oct-20 Apr 6 & Oct 6 ;::q ;...i

RBC Sr Deposit Note 2,478,699.40 2,497,000.00 1.92% 571 24-Dec-18 17-Jul-20 Jan 17 & Jul 17

BNS 5 Yr Sr Deposit Note 2,484,904.81 2,502,000.00 2.09% 625 24-Dec-18 9-Sep-20 Mar 9 & Sept 9

�BMO Fixed Rate Dep Note 2,488,124.10 2,505,000.00 2.10% 652 24-Dec-18 6-Oct-20 Apr 6 & Oct 6

-

_o.

m

0

0 _c,

I - 153 -

CITY OF PICKERING OUTSTANDING INVESTMENTS AS AT DECEMBER 31, 2018

Financial

Institution Instrument

CIBC Global Social Dep Notes RBC Senior Note CIBC Deposit Notes BMO Deposit Note TD Deposit Note ·

TD Wealth National Bank Extendible Step Up

CIBC Deposit Note Total Long-term

Total External Investments

lnterfund Investments (Internal Loans)

Development Charge Reserve Fund

Total as at December 31, 2018

Cost

2,708,151.00 2,485,793.90 1,984,654.22 1,994,271.95 2,729,171.13 2,000,000.00 2,099,000.00

63,682,762.42

162,890,059.51

Principal Yield Term

2,694,000.00 2.90% 995 2,516,000.00 2.03% 812 2,036,000.00 1.64% 931 2,053,000.00 1.61% 1039 2,733,000.00 2.62% 1094 2,000,000.00 2.70% 3653 2,099,000.00 2.50% 3653

63,843,000.00

163,550,792.35

1,986,799.00 1.83% to 2.64% various

165,537,591.35

Purchase

Date

24-Dec-1824-Dec-1824-Dec-1824-Dec-1824-Dec-18

6-Nov-1518-Nov-15

various

Maturity Interest

Date Payable Dates

14-Sep-21 Mar 14 & Sept 14 15-Mar-21 Mar 15 & Sept 1512-Jul-21 Jan 12 &Jul 12

28-Oct-21 Apr 28 & Oct 2822-Dec-21 Jun 22 & Dec 22

6-Nov-25 Nov 618-Nov-25 May 18 & Nov 18

various

- 154 -

ATTACHMENT#...3.._ TO REPORT#�.,,. I�

BMO

Mr. Stan Karwowski Division Head, Finance and Treasurer

Wealth Manageinent BMO Nesbitt Burns

Corporate Services Department, City of Pickering 1 The Esplanade, Pickering, ON LlV 6K7

Dear Stan,

May 10, 2019

Account Reference: The Corporation of the City of Pickering Account# 365-13206-10

The following is an overview of City of Pickering Investment Account at BMO Wealth Management, BMO Nesbitt Burns. The review includes the rates of return for the account for Calendar 2018 as well as historical annual rates of return for the previous 14 years dating back to 2004. Additionally I have also included both Economic and Capital Markets commentary for 2018 and comments and discussion looking forward in 2019 from some of BMO Capital Markets top analysts and strategists.

The Big Fade

Canada

Sal Guatieri, Senior Economist January 4, 2019

The Canadian economy performed largely as expected in 2018 with estimated annual growth of around 2.1% falling just shy of our call at the start of th.e year. This would mark a sharp slowdown from the prior year's 3.0% pace as three driving forces-the oil price recov_ery, supportive financial conditions and enhanced child benefit payments- all faded. Rising interest rates corralled household credit to the slowest pace since 1983, slicing the rate of consumer spending almost in half to around 2%. New auto sales reversed 8% in 2018 from record highs. After bolting out of the gate, business investment slowed, initially due to mounting uncertainty about NAFTA and then to rising concern about a global trade war. Tougher mortgage rules also took the wind out of the previous high-flying Vancouver and Toronto housing markets. On the plus side, exports benefitted from stronger U.S. demand and a weaker currency, while the federal government kept the spending taps open, despite a sizeable budget deficit. Moreover, the recent Business Outlook Survey showed surprisingly positive sentiment and intentions to increase spending and hiring.

Growth is expected to ebb further to 1.8% in 2019 owing t.o depressed oil prices, Alberta's mandatory crude output cuts, a slower. U.S. and global economy, and GM's Oshawa plant closure. While Alberta's output cuts have helped shrink the discount on Western Canadian Select crude to a more normal $16 from a record above $50, the main issue is that WTI prices fell 25% in 2018 amid a whopping 40% plunge in the last three months of the year to $46 a barrel. OPEC reductions should support a partial recovery in WTI prices this year to an average of $59. Led by weakness in the energy sector, growth in business spending is expected to slip below 2% in 2019 from an estimated 5% in 2018, despite support from the accelerated depreciation allowance and (the assumed) approval of the USM CA by the new U.S. Congress. Consumer spending growth will downshift further to below 2%. Home sales and prices are unlikely to rise this year, while housing starts should decelerate from elevated levels that have been supported by the fastest population growth in 27 years. The good news is that the· economy should expand enough to keep the jobless rate hovering near its four-decade low of 5.6%.

- 155 -

After raising rates 75 basis points in 2018, the Bank of Canada has turned cautious as it tries to discern the impact of lower oil prices and tighter financial conditions on the economy. Low inflation-all three of the Bank's core measures stood at 1.9% in November-provides the luxury of time. Assuming some recovery in oil prices and financial markets, the Bank could raise policy rates in April and October, with a final move in 2020 t� the low end of a neutral range (2.5%-to-3.5%). Under this scenario, the 10-year Canada yield, which ended 2018 below where it started, could climb from 1.9% recently to 2.3% by year-end.

The Canadian dollar fell 8% against the mighty greenback in 2018, undercut by the downturn in oil prices and ongoing competitiveness issues, such as the lack of pipeline capacity. The currency will struggle to get off the ground in 2019, though a partial recovery in oil prices could prod it toward 15 cents (C$1.34) by year-end from 73.3 cents (C$1.364) at the start of the year.

Our key forecasts for the Canadian economy

2018 2019 g1 g2 Q3 Q4 g1 g2 Q3 Q4 g1

P roduction q/q 0/o chng: a.r. Real GOP (chain-weighted) 1.3 2.6 2.0 0.4 0.2 2.3 2.2 1.5 1.6

Final Sales 0.1 3.9 3.8 -1.3 -1.1 3,9 2.0 1.4 1.6 Final Domestic Demand 1.5 1.2 -0.5 -1.5 2.5 1.9 '1.7 1.5 1.7 Consumer Spending 1.5 1.7 1.3 0.7 2.2 1.6 1.6 1.4 1.4

Durables 0.7 -'1.4 -1.8 -2.0 2.3 1.7 15 1.5 1.3 Nondurables 0.5 0.8 1.9 0.0 2.6 1.6 1.6 1.3 1.4 Seivices 2.4 2.7 1.5 2.0 2.1 1.6 1.6 1.'4 1.5

Government Spending 1.9 0.9 1.6 -0.6 3.3 2.1 2.0 2.0 2.2 Business Investment 7.0 -1.4 -10.8 -10.9 2.2 3.8 3.2 2.9 2.8

Non-residential Construction -2.2 -3.2 -8.0 -15.0 2.5 4.0 35 3,0 3.0 Machinery and Equipment 22.7 1.3 -14.7 -4.8 1.7 3.5 2.8 2.8 2.5

Residential Construction -9.7 0,6 -5.5 -14.7 2.0 1.5 05 0.0 1.0 Exports 1.0 14.6 3.3 -0.2 -4.7 5.7 2.7 1.6 2.0 Im orts 4.7 5,2 -8.6 -1.1 6.3 -0.4 2.0 2.0 2.1

2007$ blns (contribution in ppfo: a.t.) Inventory Change 21.3 15,4 5.4 13,4 19.9 11.8 12.9 13.4 13.5

Contrlbutlon to GDP Growth 1.0 -1.1 -1.9 1.5 1.3 -1.6 0.2 0:1 o.o

Net Exports -25.6 -12.0 8.2 9.6 -8.4 1.4 2.6 1.9 1.7 Contribution to GDP Growth -1.3 2.8 4.0 0.3 -3.6 1.9 0.2 -0.2 -0.1

$bins: a.r. (growth in q/q % chng: a.r.) 2,268 Nominal GDP 2,194 2,214

Growth 3.0 3.7 Real GDP t;,i:, chn 2.2 1.7 tnf ation GDP Price index CPI All items

Ex. Food and Energy Food Prices Energy Prices Seivlces

q/q o,\ chng: a.r.1.9 1.1 3.3 1.2 2.7 0.9 1.0 1.6

16.1 6.6 4.2 2.7

CPI All Items y/y% chng 2.1 2.3 CPIX8 y/y 1v., chng 1.3 1.4 Ne Core CPls • �".lchno:av. 1.9 1. Financial overnight Rate 3-Month T-Blll 90-0ay BAs 10-Year Bond Yield 10-Year 888 Corporate Spread Canada/US Spread

90 Day 10 Year

Foreign Trade current Account Balance

Share of GDP Merchandise Balance Non-Merchandise Balance

US$

Yen Euro Incomes

Corporate Profits Before Tax Corporate Profits After Tax Personal Income Real Disposable Income

fl/, : quarterly avg, 1.25 1.25 1.14 1.21 1.67 1.74 2.24 2.28

ppts 1.68 1.80 bps

-44 -66 -52 -64

$bins: a,r.

-69.0 -63.4 -3.1 -2,9

-33.2 -20.1 -35.8 -43.3

quarterly avg. US</C$ 79,1 77.5 t$/US$ 1.265 1.291

¥/C$ 85.7 84.6 cs t 1.55 1.54

y/y % chng -3.4 4.6 -1.5 1.7 5.4 4.7 3.6 2.6

5avinos Rate ��: nuarte:rlv avo. 1.5 1.2

2,238 2,223 2,243 2,291 2,310 2,331 4.4 -2.7 3.6 4.6 4.0 3.4 3.6 1.9 1.6 1.3 13 1.3 1.6 1.9

2.2 -3.3 3,6 2.2 1.8 1.9 1.9 2.6 1.1 1.5 2.9 23 2.1 2.0 2.5 2.0 1.9 2.2 2.0 2.1 2.1 3.3 3.7 4.1 2:4 1.8 2.1 2.0 1.6 -17.9 -7.1 25.9 6.7 2.0 1.4 4.8 0.2 1.9 3.0 2.3 1.5 1,9 2.7 2.0 1.6 2,0 1.9 2.2 2.3 1.6 1.6 1.6 1.7 1.8 1.9 1.9 2.0 1.9 1.9 .8 1.9 .9 1.9

1.50 1.75 1.75 1.75 1.75 1.75 1.75 -J.47 1.66 1.65 1.65 1.65 1.65 1.65 1.95 2.20 2.14 2.00 2.00 2.00 2.00.

· 2.28 2.32 1.86 1.70 1.75 1.B5 1.85 1.83 2.07 2.20 2.10 2.20 2.30 2.30

-61 -70 -79 -76 -76 -76 -75 -65 -72 -80 -78 -77 -76 -75

-40.4 -61.9 -72.9 -61.7 >61.8 -63.6 -62.8 -1.8 -2.8 -3.2 -2.7 -1.7 -2.8 -1.7

-3.8 -28.9 -41.0 -30,7 -30.2 -31:2 -31,B -36.6 -33.0 -31.9 -31.0 -31.6 -32.4 -31.0

76.5 75.7 75.2 74.5 74.8 75.3 75.7 1.307 1.321 1.329 1.342 1.336 1328 1.321

85.3 85.3 82.9 82.6 82.5 82.9 83.2 1.52 1.51 1.51 1.50 1.50 1.49 1.48

14.9 -16.6 -14,9 -6,3 -3.5 285 28.5 20.7 -2.9 0.1 13.1 13.9 28.5 28.5

3.7 3.2 3.4 3,7 4.1 3.9 3,9 0.6 0.3 1.3 1.4 2.0 1.9 :1.9 0.7 1.1 1.3 1.5 1.6 1.6 2.0

Other Indicators quarterly avg. (ooos and mlns are a.r Unemployment Rate percent 5.8 5.9 5.9 5.7 5.8 5.1 5.7 5.7 5.7 Housing Starts ooos 224 218 197 217 188 218 209 208 202 Existing Home Sales y/y 'h chng ·14.5 -13.8 -2.8 -12.4 -1.0 2.6 -1.1 1.7 2:0 MLS Home Price index y/y ¼chag 5.8 0.9 2.3 1.6 -0.5 -to 0.5 1.6 1.1 Motor Vehicle Sales mlns 2.11 2.04 2.02 1.97 2.01 1.95 1.91 1.91 1.91

q/q 11/• chng: a,r. Employment Growth 0.3 1.0 1.3 2.2 2.9 2.4 0.5 0.9 1.5 Industrial Production 5.0 2.6 2.5 -2.0 -1.9 2.3 3.0 2.3 1.8 Federal Budaet Balance �; of FY GOP

, . Shaded value"' rc:present forecasts

May 10, 2019

2020 92 . 93 Q4 2017 2018 2019 2020;

1.5 1.6 15 3.0 1.8 1.4 1.7 1.5 1.6 1.5 2.1 -2.0 1.3 1.7 1.6 1.6 1.5 3.1 1.9 1:0 1.6 1.4 1.4 1.4 3.6 2.1 1.5 1.4 1.3 1.3 1.3 7.1 1.1 0.4 1.4 1.3 1.3 1.3 2.7 1.6 1.5 1.3 1.5 1.5 1.5 3.3 2.6 • 1.8 1.5 1.8 2.0 1.8 2.7 2.7 1.7 2.0 2,3 2.3 2.0 2.5 1.7 -1.9 2.7 2.5 2.5 2.0 1.1 -0.9 -2.3 2.9 2.0 2.0 2.0 4.7 5.8 -1.3 2.5 1.0 1.0 1.0 2.4 -2.3 -2.8 0.8 2.0 2.0 2:0 1.1 3.3 1.5 2.2 2.0 2.0 2.0 4.2 2:9 0.8 ·1.9

13.5 13.5 13.6 17.6 13.9 14.5 13.5 0.0 0.0 0.0 0.8 -0.2 0.1 -0.1 1.7 1.7 1.7 -7.3 -4.9 -0.6 1.70.0 0.0 0.0 -1.1 0.1 0.2 0,1

2,351 2,371 2,391 2,142 2,218 2,278 2,361 3.5 3.5 3.5 5.6 3.6 2.7 3.6 1.7 1.6 1.6

1.9 1.9 1.9 2.5 1.7 .1.4 1.9 1.9 2.0 2.1 1.6 2.3 1.9 2.1 1.9 2.0 2,1 1.6 1.9 2.0 2.0 2.1 1.8 2.1 0,1 1.8 3.0 2.0 2.3 2.4 2.0 5.4 7.5 0.3 3.8 2.4 23 1.5 2.2 1.5 2.2 2.1 2.1 2.0 2.0 2.1 1'.9 2.0 1.1 1.4 1.8 2.0

'2.1 1.9 2 1 1.5 1.9 1 2.0

1.75 1.75 1.75 0.71 1.44 1.75 1.75 1.65 .1.65 1.65 0.69 1.37 1.65 1.65 2.00 2.00 2.00 1.15 1.89 2.05 2.00 1,80 1.75 1.70 1.78 2.28 1.80 1.75 2.30 2.30 2.30 1.83 1.85 2.20 2.30

-74 -72 -71 -26 -60 -77 -73 -74 -73 -72 -55 -63 -78 -73

-61.6 -60.4 -59.1 -60.1 -58.7 -65.0 -61,0 -2.6 -1.5 -2.5 -2.8 -2.6 -1.9 -2.6

-32.1 -32.4 032.7 -24.6 -21.5 -33.3 -32.2 -29.5 -28.1 -26.4 -35.5 -37.2 -31.7 -28.8

76.1 76.4 76.8 77.1 77.2 75,0 76.3 1.315 1.308 1.302 1.298 1.296 1.334 1.311

83.4 83.6 83.8 86.5 85.2 82.7. 83.5 .1.48 1.48 1.48 1.46 1.53 1.50 1;48

12.2 4.8 3.5 34.0 -0.4 -0,3 11.4

12.2 4.8 3.5 15.8 4.1 13.9 11.4 3.6 3.5 3,5 4.5 4.2 3.7 03.6 1.6 1.5 1.5 3.4 1.8 1.7 1.6 1.9 1.9 1.9 1,6 1.1 1.5 1.9

5.6 5.6 5.5 6.3 5.8 5.7 5.6 200 200 200 220 214 205 200 1.9 1.0 1.1 -4.7 -10.9 0.0 2.0 1.2 1.5 2.0 13.2 2.8 0.0 1.5

1.90 1.89 1.89 2.08 2.04 1.95 1.90

2.2 1.6 1.1 I 1.9 1.3 1,9 1.4 1.5 1.6 ·t.6 4.9 2.6 0.5 2.0

I -0.9 -0.7 -0.9 -0.8

- 156 -

Brian Belski - Chief Investment Strategist January 7, 2019

Caution Remains Prevalent Heading Into 2019

2018 was a difficult year to say the least with the S&P/TSX declining 11.6% marking the worst annual performance since 2008. In fact, there were very few areas to hide, with only Technology and Consumer Staples posting positive returns on the year. Furthermore, the S&P/TSX declined 5.8% in December, the worst December price return since 1931. On the bright side, fundamentals have remained resilient throughout 2018, with the bulk of the decline being driven by multiple contraction. In fact, both the 12-month forward and 12-month trailing price-to-earnings ratios contracted by 3.8x in 2018, the largest contraction since 2011. Indeed,sentiment remains clearly negative as global and domestic concerns continue to weigh heavily on Canadianequities heading into 2019. Ultimately, we believe barring a broad global recession, which we do not expect, themarket has already priced in a significant economic and earnings slowdown. As such, we believe investorsshould view the current weakness as an opportunity to add to preferred high-quality Canadian names thatshould and will outperform in a rebound.

Performance Shifts Suggest Investors Hedging Against Recession

Since the S&P 500 peak on September 20, 2018, Canadian sector rotation has clearly favoured the traditional recession play book. In fact, while the broad market has experience a significant multiple compression, there has been little to no multiple compression within tbe traditional defensive sectors since the start of the correction. Furthermore, since the end of July, investors have shown a clear preference for.lower risk fundamentals, as only our Low Risk and High Quality factor profile categories have outperformed. Indeed, not only are.recent flows moving to more traditionally defensive sectors from the more cyclicals, but also investors are shifting to lower volatile names and stronger profitability, and away from companies with high growth expectations.

Analysts Shifting to More Cautious Tone

With equities deep in correction territory, a hawkish fed, elevated US-China trade war rhetoric and government shutdown concerns, analysts have taken a more cautious tone. In fact, the percent of upward revisions have now fallen back the long-term historical average after remaining elevated for over a year.

Global Index and Commodity Returns: December 31, 2018

Major Global Indices ff Commodities Index 1M 3M 6M 12M YTD

S&P/TSX -5.8 -10.9 · -12.0 -11.6 -11.6

S&P/lSX 60 -5.9 -9.8 -11.0 -10.5 -10.5

S&P /TSX Small Cap -3.9 -15.0 -17.9 -20.1 -20.1

S&P 500 -9.2 -14.0 -7.8 -6.2 -6.2

DJ Industrial Average -8.7 -11.8 -3.9 -5.6 -5.6

NASDAQ Composite -9.5 -17.5 -11.7 -3.9 -3.9

STOXX Europe 50 -5.9 -10.0 -9.3 -13.1 -13.1

FTSE 100 -3.6 -10.4 -11.9 -12.5 -12.5

Japan Nikkei 225 -10.5 -17.0 -10.3 -12.1 -12.1

ASX All Ordinaries -0.7 -9.7 -9.2 -7.4 -7.4

MSCI EM (Emerging Markets) -2.8 -7.8 -8.7 -12.3 -12.3

Crude Oil WTI (NYM $/bbl) Continuous -10.8 -38.0 -38.8 -24.8 -24.8

Gold (NYM $/ozt) Continuous 4.5 7.1 2.1 -2.1 -2.1

- 157 -

2500

2000

1500

1000

Equities

500 ----

6

4

2

07 09

Real GOP

EQUITIES REBOUND (indices : as of May 6, 20'19)

11 13 ·15

GROWTH TO MODERATE

(y/y 0/o change)

30000

15000

5000

19

0 -:-��------+I--JJ,------.\1

·2

-4

-6

17

Canada 3.0

us 2.2

00 02 04 06 08 10 12

FULLY EMPLOYED (percent)

Unemployment Rate

14

12 Canada

·10

8

2

70 75 80 85 90 95 00

18 19 20

1.8 1.5

2.9 2.5 1.7 forecast -, ,., ·'-·,..---

14 16 18 20

05 .10 15

110

100

90

80

70

LOONIE LANGUISHES (USC : as of May 6, 2019)

Canai:lian Dollar

60 +---�---...----"·""�--�-�

6

0

-2

-4

6

3

0

-3

03 05 07 09 11 13 1,. ., 17

CONSUMER SPENDING DOWNSHIFTS

(y/y 0/o change)

Real Personal Consumption Expenditures

00 02

U.S.

04 06 08 10 12 14 16

INFLATION ON MUTE

Consumer Price Index (y/y O/o change)

19

forecast --'--,--

18 20

Canada United States

Headline Headline

3

0

-307 12 17 07 . 12 17

1 core = CPI ex 8 most volatile components & indirect taxes ' core = CPI ex food & energy

6

4

- 25000

· 20000

· 10000

.· . I MJ<:\, V _.----------

I U.S. -,:--,.......- -~----,~~~--~~~

...,-y-

~r forecast

--.---¼-20

- 158 -

-

NATURAL GAS FIZZLES, CROPS DROP

Commodity price range since start ofQ019

Materials ft Foodstuffs (as of May 6, 2019)

Metals ft Energy (as of May 6, 2019)

Lumber (US$/

lOOOsq ft) 314.90

Soybeans (US$/bu)

7.79

Wheat (US$/bu)

Corn (US$/bu)

l.2l

8.71

Gold (US$/oz)

Oil (US$/bbl)

-1SA l

Natural Gas (US$/mmbtu)

Copper (US$/lb) 2.

64

North American Outlook - Canada

62.25

66A0

WTI Crude Oil

·150

07 09

Oil PRICES RECOVER

(US$,.lbbl : as of May 6, 2019)

11 13

May 7, 2019

.

'17 19

• Investors also expect the Bank of Canada to chop rates this year, though not due to too�low inflation-the-core rate is practically sitting on the 2% target-but because of a downbeat economy. Real GDP barely grewin Q4 and looks to do just slightly better in Ql. Mandated oil output cuts are a factor, but the bigger issue isthat even non-energy exports have backfired recently due to a slowing global economy, fadingcompetitiveness and trade tensions with both the U.S. (metals) and China (agriculture). Consumers are in nomood to drive the expansion, as they are now borrowing at the slowest rate in 35 years to get \3 handle onrecord debt burdens. Meantime, the housing market is merely steadying after last year's slump in the faceof higher interest rates and tougher lending rules, and remains weak in some regions, notably Vancouverand the oil-producing provinces.

• Canada does have a few things going for it, though. The first is the recovery in oil prices and a sharp declinein the discount on Canadian crude, which is now about half its norm. While this won't overcome regulatoryhurdles and spur new investment, it will pump much-needed revenue into the coffers of energy producersand Alberta's Government. The second is the fastest population growth in a quarter century, driven bystrong international migration. This has boosted labour force growth and eased worker shortages, in turnencouraging hiring. Outside the energy patch, business investment intentions remain po�itive, according tothe Business Outlook Survey. The federal government's accelerated depreciation allowance was a helpfulinitial step in bridging the competiveness gap.

• · The bad news is that wages and productivity are depressed, with the former rising about 2% in the pastyear.and the latter stalling after a listless decade. Zero real wage gains provide little support to consumers,while zero productivity undercuts competitiveness further. Consequently, although GDP growth is expectedto pop above 2% in Q2, in part due to some easing in oil output restrictions, we still see a slower 1.5% pace

in 2019, down from 1.8% in 2018 and not much faster than the population is growing. This risks an upturn in the jobless rate from current four-decade lows.

• With so much stacked against it the Canadian dollar will do well to hold its own against a firm greenback.We see it hovering below 75 cents (US) for most of 2019, barring a further climb in oil prices which we deemunlikely given record U.S. shale production.

125

100

50

25

- 159 -

• Given the sluggish economy, the Bank of Canada has backed away (at least for now) from plans to lift rates

further. While Governor Poloz continues to warn that the current 1.75% policy rate remains belowthe neutral range of 2.25%-to-3.25%, the tightening hurdle appears high, barring an upside growth surprise.At the same time, a rate cut is unlikely given that core inflation is on target and growth is expected· toimprove at least somewhat this summer. We see a standoff, with rates on hold for the next two years.

• Legislative failure to ratify the USM CA, weaker growth in resource gobbling China, and growing tradetensions between Canada and China are several downside risks to the Canadian economy. USM CAratification appears unlikely until after the presidential election, which will weigh on business spending. Thecountry's best hope for an upside surprise is if the U.S. economy outperforms.

Rro:vincial GDR

Real GDP Growth Rate (percent) Canada Newfoundland

· ';.. BritishI ·•

I, cdltJJQbia 2017 3.8 2018 2.4 2019 1.8

2017

2018

2019

2020

3.0 'f\.' 1.8

1.4

1.7

·,

and Labrador 2017 0.9

'-.-. -····7-�2 _01_ 8_�-2_.7_ 2019. 2.0 2020 0.2

(',.2020 ff f •

2.4 1 Alberta / . . '

Manitob,!1 _ 11 '1 \rz o,1 .

r \\\Ji \ r' \

Quebec (. ,.J(:'.)Ptince Edward 1\ l2017 4.4 2017 3.2 \ , !2017 2.8 /- /, (/ .,·;./�-- Island. ]2018 2.3 2018

2019 1.3 2019 2020 2.2 2020

5,�skatchewdn 2017 2.2

···2018 1.62019 0.9 2020 1.3

1.3 1.5 1.6

lf:ll '2018 2.5 /, ) ,,,/ 2017 3.5

Oatado ' ;��: � : ,'/"_;_·_1.),)�_�t... ;E� !:;12017 2.8 ' l ) New (_ t' •••••• Nova 12018 2.2

- • 2019 1 _6 .. A3runswid/ s�otia 2020 1.7 / 2017 1.8 2017 1.5

2018 0.1 2018 1.2 2019 0.6 2019 0.7

Shaded bars are BM0 Economics forecasts 2020 0.7 2020 0.7

Ontario

Ontario's economy has moderated after a powerful multi-year run. Real GDP is expected to grow 1.6% this year, down from 2.2%.in 2018 and an average pace of 2.5% in the four years prior to that. The downshift largely reflects a move back toward potential for the province, with some key sectors, such as housing, coming off the boil.

The· housing market is stabilizing after a wave of recent policy measures (15% tax on non-resident buyers and OSFI rules), and after five Bank of Canada rate hikes. Toronto detached home prices are down roughly 10% from their peak, but eondo prices remain at record levels and vacancies are extremely low. This highlights that, despite measures to cool price growth, fundamental supply/demand conditions are still very supportive.· Meantime, markets outside the Greater Golden Horseshoe continue to perform very well.

•·, ..

- 160 -

The labour market is solid, with 2.5% y/y job growth in 2019Q1, the strongest in 16 years. The jobless rate, at 6% has held relatively steady over the past year amid surge in t.he labour force, but the province has been able to churn out enough jobs to absorb the influx. The province drew in a record 215,000 migrants from outside Canada and other provinces in 2018. Export volumes are rising at a very modest pace, and longer-term issues remain as relatively high labour and electricity costs continue to pose challenges- many sectors are pushing capacity limits, but have been shy to deploy new investment. That said, USMCA clarity, accelerated CCA allowances and a business-friendly policy shift should support business confidence and investment.

The Province of Ontario is projecting a $10.3 billion deficit in FY19/20 (1.2% of GDP), following an $11.7 billion shortfall expected for FY18/19. The Province expects the deficit to shrink gradually before returning to balance in FY23/24, and will focus on ·reducing real per-capita program spending, while following through on tax-cut promises.

Portfolio Performance Review

For comparison purposes we have included the following benchmarks that provide the closest representative return data. There are three separate issues that should be taken into consideration when comparing the representative rates of return. First, the guidelines set out in the Municipal Finance Statutes governing your investment policy prohibit you from owning any fixed income investments that are not either government guaranteed or issued by a major Canadian Chartered Bank. Canadian money market funds used to construct the Morningstar Canadian Money Market Index contain a high percentage of higher yielding money market products including investments such as asset backed securities, some of which your investment policy prohibits you from holding. Secondly, your portfolio has a smaller percentage of qualified fixed income investments that are slightly longer than the 1 year maturity period that typically defines money market investments.

Annual Account Return Benchmark Comparisons*

Your BMO Nesbitt Burns CIBC World Markets Morningstar Canadian Calendar Year Account Return** 91 Day T-Bill Index** Money Market fv!utual

Fund Index***

2018 1.56% 1.15% 1.20%

2017 0.89% 0.52% 0.47%

2016 0.84% 0.50% 0.32%

2015 1.36% 0.64% 0.37%

2014 1.51% 0.91% 0.59%

2013 1.23% 0.97% 0.56%

2012 1.37% 0.93% 0.58%

2011 2.49% 0.96% 0.64%

2010 1.25% 0.37% 0.31%

2009 1.54% 0.52% 0.53%

2008 4.92% 3.13% 2.84%

2007 4.27% 4.29% 3.82%

2006 3.81% 3.84% 3.21%

2005 2.51% 2.48% 1.87%

2004 4.39% 2.27% 1.51%

- 161 -

* Return Comparisons are derived from separate third party sources which are believed to be accurate but are notguaranteed by BMO Nesbitt Burns Inc.** Comparative benchmarks have been selected that are most reasonable to use for comparison purposes but are not 100% specific to the investment guidelines followed by the representative account in question. *** The Morningstar Fund Indices are the best available representation of the performance of aggregate dollars actually invested, currently and historically, in Canadian money market mutual funds and/or segregated funds. The indices measure the dollar weighted return of assets in Canadian funds. The return calculation does not suffer from survivorship bias, as the impact of returns with funds that are no longer active are retained. Funds that report returns before fees are excluded from Morningstar Fund Indices. Returns are rounded to 2 decimal places.

In conclusion, I would like to highlight the following points;

a} Our investment parameters are much narrower than money market funds. Government legislationgoverning Municipal Investments limits the selection of qualified investments.

b} Within the portfolio, we have successfully blended a small percentage of investments with a timehorizon exceeding 12 months, but less than 3 years.

c} The account maintains an active pattern of cash in-flows and out-flows as a result of the nature of thecash-flow requirements of an entity like the City of Pickering. As a result, it can be difficult to execute aspecific investment plan that is not highly liquid and flexible.

d} While the current and anticipated interest rate environment is extremely important _in shaping thecomposition of the account portfolio, we always endeavour to attempt to avoid making decisions thatcould be construed as market timing any changes in relation to Bank of Canada rate decisions.

Sincerely,

Andrew R. Geddes PFP, CIM, FCSI

Vice President, Portfolio Manager, Senior lnvestmerit Advisor BMO Wealth Management, BMO Nesbitt Burns Inc.

Client Reports Disclaimer

CHARTERED

INVESTMENT MANAGER �cs� FELLOW OF CSI

This report is not an official statement. It is a supplemental consolidated summary of your positions held at BMO Nesbitt Burns Inc. along with unofficial positions held off-book. It is provided to you solely for information purposes and may, in part, be based on information provided by you or from third party sources and must not be relied upon for its accuracy. The unofficial positions identified in this statement with {*} may be held at other financial institutions where they may not be covered by the Canadian Investor Protection Fund {"CIPF"}. Please consult the monthly statements you receive from the relevant financial institution{s) to determine CIPF coverage. Also, please consult the monthly statements you receive from BMO Nesbitt Burns Inc. to determine which positions are held in segregation. In October of each year, your official statement from BMO Nesbitt Burns will include a request that clients examine their month-end statements ca'refully and bring to BMO Nesbitt Burns' auditor's attention any discrepancies.

- 162 -

Securities Disclaimer

The opinions, estimates and projections contained herein are those of the author as of the date hereof and are subject to change without notice and may not reflect those of BMO Nesbitt Burns Inc. ("BM_O NBI"). Every effort has been made to ensure that the contents have been compiled or derived from sources believed to be reliable and contain information and opinions that are accurate and complete. Information may be available to BMO Nesbitt Burns or its affiliates that is not reflected herein. However, neither the author nor BMO NBI makes any representation or warranty, express or implied, in respect thereof, takes any responsibility for any errors or omissions which may be contained herein or accepts any liability whatsoever for any loss arising from any use of or reliance on this report or its contents. This report is not to be construed as an offer to sell or a solicitation for or an offer to buy any securities. BMO NBl,.its affiliates and/or their respective officers, directors or employees may from time to time acquire, hold or sell securities mentioned herein as principal or agent. NBI will buy from or sell to customer's securities of issuers mentioned herein on a principal basis. BMO NBI, its affiliates, officers, directors or employees may have a long or short position in the securities discussed herein, related securities or in options, futures or other derivative instruments based thereon. BMO NBI or its affiliates may act as financial advisor and/or underwriter for the issuers mentioned herein and may receive remuneration for same. A significant lending relationship may exist between Bank of Montreal, or its affiliates, and certain of the issuers mentioned herein. BMO NBI is a wholly owned subsidiary of Bank of Montreal. Any U.S. person wishing to effect transactions in any security discussed herein should do so through BMO Nesbitt Burns Corp. Mem.ber-Canadian Investor Protection Fund.

Corporate Trade-mark Disclaimer

®"BMO (M-bar roundel symbol)" is a registered trade-mark of Bank of Montreal, used under licence. ® "Nes_bitt Burns" is a registered trade-mark of BMO Nesbitt Burns Inc._ BMO Nesbitt Burns Inc. is a wholly-owned subsidiary of Bank of Montreal. BMO Wealth Management is the brand name for a business group consisting of Bank of Montreal and certain of its affiliates in providing wealth management products and services.

- 163 -

PORTFOLIO PERFORMANCE (CAD)

Changes in Market Value

Starting Value

Inflows

Outflows

Income

Ending Value

Performance

Money-Weighted-Net

2018

01/01/2018-12/31/2018

$ 10,384,480.84

$ 0.00

$-108,584.84

$ 192,209.22

$10,461,471.41

1.794%

Notes: Values in percentage are annualized for periods of more than twelve months.

05/30/2019

03:39 PM

TD Wealth

Bill MacMillan

THE CORPORATION OF THE CITY OF PICKERING (7AS047A)

As of May 29, 2019

Page: 1 / 3

- 164 -

Pl

From:

Subject:

of-

KER]


Report to

Executive Committee


Annual Indexing - Development Charges and Seaton Financial Impacts Agreement

Recommendation:

1. That Report FIN 11-19 of the Director, Finance & Treasurer be received;

2. That effective July 1, 2019 as provided for in By-law No. 7595/17, theDevelopment Charges (the "DCs") referred to in Schedule "C" of that By-law beincreased by 5.2 per cent;

3. That effective July 1, 2019 as provided for in By-law No. 7595/17, the DCsreferred to in Schedule "D" of that By-law be increased by an annual indexing of5.2 per cent;

4. That effective July 1, 2019 the payments related to "10 per cent Soft Services" asprovided for by the Seaton Financial Impacts Agreement (FIA) dated November26, 2015 be increased by an annual indexing of 5.2 per cent; and

5. That the appropriate City of Pickering officials be authorized to take thenecessary actions as indicated in this report.

Executive Summary: The Development Charges Act 1997 and Ontario Regulation 82/98, and By-law No. 7595/17 provide for an automatic annual adjustment to the City's development charges based on the Building Construction Price Index in order to keep development charges revenues current with construction costs. The Building Construction Price Index for the non-residential buildings construction for the annual period ending March 31, 2019 is 5.2 per cent. Adoption of the recommendations of this report will put into effect the higher rate for the period of July 1, 2019 to June 30, 2020.

Attachment 1 provides the DCs by service category for the City-wide area in Pickering excluding the Seaton lands with the new rates reflecting the annual indexing of 5.2 per cent.

- 165 -

FIN 11-19

Subject: Annual Indexing and Development Charges for City-Wide and Seaton Lands

June 17, 2019

Page 2

Attachment 2 provides the DCs by service category for the Seaton lands, and the new rates with the indexing of 5.2 per cent as well as additional charges applicable to development in Seaton as approved in the Seaton Financial Impacts Agreement (FIA).

Financial Implications: Increasing the development charges based on an increase in the construction price index will assist in keeping the revenues generated in line with current construction costs.

Discussion: As provided for in Ontario Reg. 82/98, s.7, and in section 16 of the City's By-law No. 7595/17, the development charges charged by the City for all types of development shall be indexed annually without amending the By-law. Adoption of the recommendations contained in this report will allow that increase to take effect July 1, 2019, thereby assisting in keeping revenues in line with the costs that development charges fund.

Note that starting from the first quarter of 2018, Statistics Canada released the first building construction price indexes that included both new residential and nonresidential buildings construction in Canada. The City continues to use the nonresidential buildings construction price index for the purpose of indexing the DCs rates.

Statistics Canada indicates that the non-residential buildings construction price index (an indicator of our costs of construction) for the Toronto area has increased by 5.2 per cent for the annual period from April 1, 2018 to March 31, 2019. The change is reflected in the tables attached.

The 2017 DC Background Study was completed in December 2017. DC By-law No. 7595/17, section 16(1 )(ii) provides that commencing on July 1, 2019, the rates in Schedule "C" shall be adjusted annually in accordance with the change in the index for the most recently available annual period ending March 31. Attachment 4 provides the change in rates in Schedule "C" from July 1, 2018 to July 1, 2019 based on the 5.2 per cent indexing. Schedule "C" is applicable to the new DCs rates effective on January 1, 2018 as a result of the 2017 DC Background Study.

The same By-law, under section 16(1) (iii) provides that the rates in Schedule "D" shall be adjusted on July 1, 2018, July 1, 2019 and July 1, 2020 in accordance with the change in index for the most recently available annual period ending March 31. Schedule "D" is applicable to residential apartments dwelling units for the area outside of Seaton lands. Attachment 5 provides the change in rates in Schedule "D" from July 1, 2018 1 to July 1, 2019 based on the 5.2 per cent indexing. The implementation of new DCs rates for apartment dwellings units was delayed to accommodate the long-term planning and construction cycle associated with this development.

- 166 -

FIN 11-19

Subject: Annual Indexing and Development Charges for City-Wide and Seaton Lands

June 17, 2019

Page 3

Continuing from previous years, City staff are including in the DCs annual indexing report, additional charges applicable to development in Seaton lands as approved in the Seaton FIA. Sections 4 - 6 of the FIA outline the DC-related financial terms of the agreement. Note that of all the 3 services collectible based on the Seaton FIA, the. "10% Soft Services" is the only service to be indexed. Attachment 3 provides the further details on these charges with the 5.2 per cent indexing.

The Seaton DC rates are lower than the City-wide DC rates to reflect the fact that the Seaton Landowner Group (SLG) is responsible to design, build and pay for the Seaton internal roads network.·

Upon Council's approval of the recommendations contained in this report, the development charges brochure will be updated to reflect the approved rates. The updated brochure will be posted on the City's website and made available at various counters throughout the Civic Complex.

Attachments:

1. City-Wide Development Charges (excludes Seaton Lands)-Effective July 1, 20192. Seaton Lands Development Charges and Financial Impacts Agreement (FIA)

Charges-Effective July 1, 20193. Seaton Lands - Financial Impacts Agreement (FIA) Charges, Section 5.14. Schedule "C" - City of Pickering Schedule of Development Charges5. Schedule "D" - City of Pickering Schedule of Development Charges for

Residential Apartments Dwelling Units for the Area Outside of Seaton

Prepared By:

3Cvvf'\� .---

Caryn Kong, CPA, CGA Senior Financial Analyst - Capital & Debt Management


Stan Karwowski, CPA, CMA, MBA Director, Finance & Treasurer


. ;JJJ �3,2.017Tony Prev��1Eng. Chief Administrative Officer

?t (

- 167 -

Service Cateqorv

Other Services Related to a

Highway

Protection Services

Parks and Recreation Services

Library Services

Administration Studies

Stormwater Management

Transportation 1

Total

City of Pickering

City-Wide Development Charges (Excludes Seaton Lands)

Development Charges By-law No. 7595/17

Effective July 1, 2019

Per Residential Dwellinq Unit By Type Non-Residential Charges

Apt Dwellings Apt Dwellings Non-Residential per

Singles or Semi- with 2 or more with less than Other Sq. Ft of Total Floor

Detached bdrms 2 bdrms Dwellings Area

$470 $242 $177 $380 $0.16

948 487 357 766 0.35

5,175 2,658 1,950 4,179 0.42

1,158 595 437 935 0.08

296 153 112 239 0.11

307 158 117 248 0.11

6,952 3,570 2,621 5,612 1.95

$15,306 $7,863 $5,771 $12,359 $3.18

1 Does not apply to Seaton Lands. Seaton Lands subject to a separate agreement outside of the Development Charges Act concerning

provision of the Transportation requirements in addition to other funding contributions.

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DC By-law No. 7595/17

Service Cateqory

Other Services Related to a Highway

Protection Services

Parks and Recreation Services

Library Services Administration Studies

Stormwater Management

Transportation 1

Total DC By-law No.7595/17

SLG FIA

10% Soft Services 2

Non Indexed

Municipal Buildings 3

Communitv Uses 4

Total SLG FIA

Total Charges-Seaton Lands

J:\RPTCOUNC\2019\FIN llck Attachments 1-5

City of Pickering Seaton Lands Development Charges and Financial Impacts Agreement (FIA) Charges Development Charges (DC) By-law No. 7595/17 and FIA Article 5


Per Residential Dwelling Unit By Type Non-Residential Charges

Apt Dwellings Apt Dwellings Non-Residential per Prestige Employment

Singles or Semi- with 2 or with less than Other Sq. Ft of Total Floor Land in Seaton (per Detached more bdrms 2 bdrms Dwellinqs Area 5 Net Hectare'

$470 $298 $210 $380 $0.16 $5,814 948 600 425 766 0.35 12,194

5,175 3,270 2,315 4,179 0.42 14,146 1,158 732 519 935 0.08 2,779

296 186 133 239 0.11 3,797

307 195 138 248 0.11 3,738

0 0 0 0 0.00 0

$8,354 $5,280 $3,740 $6,747 $1.23 $42,468 Per Sq. Ft of Total

Floor Area

$845 $386 $386 $670 $0.098 $0.098

189 86 86 150 n/a n/a

300 137 137 238 n/a n/a

$1,334 $609 $609 $1,058 $0.098 $0.098 $42,468/ha &

$9,688 $5,889 $4,349 $7,805 $1.328 $0.098/sq. ft

1 Does not apply to Seaton Lands. Seaton Lands subject to a separate agreement outside of the Development Charges Act concerning


2 Breakdown by service category is available upon request. Not applicable to lands owned by the Province. For residential development,

payment is due at subdivision registration except for mixed-use or multi-use or multi-residential development blocks subject to site plan approval.

For all other development, payment is due prior to building permit issuance. Subject to annual indexing.

3 Applicable to the first 11,280 S.D.Es built on SPL Lands, due prior to building permit issuance. No indexing

4 Applicable to the first 11,280 S.D.Es built on SPL Lands to a maximun payment of $3.3 million; due prior to building permit issuance. No indexing

5 Does not apply to prestige employment land in Seaton, as that development is subject to the per net Ha land area charge instead. Applies

to non-residential development in the non-prestige employment land in Seaton.

T

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Service Cateqory

Development-Related Studies 1

Parks Development & Trails

Indoor Recreation Facilities

Library

Operations Facilities & Vehicles

Total

City of Pickering

Seaton Lands - Financial Impacts Agreement (FIA) Charges, Section 5.1

Section 5.1: 10% Soft Services Contribution*


Per Residential Dwelling Unit By Type ** Non-Residential Charges

Apt Prestige

Dwellings Non-Residential Employment Land

Singles or Semi- with 2 or Apt Dwellings with Other per Sq. Ft of in Seaton (per Sq.

Detached more bdrms less than 2 bdrms Dwellings Total Floor Area

$4.51 $2.05 $2.05 $3.56 0.002

214.38 97.97 97.97 170.01 0.018

446.73 204.01 204.09 354.18 0.037

107.38 49.07 49.07 85.16 0.009

72.01 32.91 32.91 57.10 0.032

$845.00 $386.00 $386.00 $670.00 0.098

* This contribution is to be indexed with the construction price index prescribed by the DC Act.

FIA version (October 28, 2013) subsection 5.1 and 5.2 permits the City to charge an additional DC to compensate for the

10% soft services deduction.

The calculation is based on the DC rate multiplied by 11.11 % as stated in the FIA agreement subsection 5.2.

Ft'

0.002

0.018

0.037

0.009

0.032

0.098

1 19.0% of the DC Recoverable share for the Development Related Studies is comprised of costs that are subject to the 10% deduction

-

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- 170 -

Schedule "C"

City of Pickering Schedule of Developement Charges-DC By-law No. 7595/17 Effective July 1, 2018

Per Residential Dwelling Unit By Type Non-Residential Charges Apt Non- Prestige

Apt Dwellings Residential Employment Singles or Dwellings with less per Sq. Ft of Land in

Semi- with 2 or than 2 Other Total Floor Seaton (per Service Cateqory Detached more bdrms bdrms Dwellinqs Area Net Hectare' Other Services Related to a Highw $447 $283 $200 $361 $0.15 $5,527 Protection Services 901 570 404 728 0.34 11,591 Parks and Recreation Services 4,919 3,108 2,201 3,972 0.40 13,447 Library Services 1,101 696 493 889 0.08 2,641 Administration Studies 281 177 126 227 0.10 3,610 Stormwater Manaaement 292 185 131 236 0.10 3,553 Total Municipal Wide Services $7,941 $5,019 $3,555 $6,413 $1.17 $40,369

Outside of Seaton Lands:

Transportation 1 6,608 4,175 2,958 5,335 1.86 0 Total Services Outside of

Seaton Lands $6,608 $4,175 $2,958 $5,335 $1.86 $0

Seaton $7,941 $5,019 $3,555 $6,413 $1.17 $40,369

Rest of Pickering-City wide $14,549 $9,194 $6,513 $11,748 $3.03

Effective July 1, 2019 Indexed at 5.20%

Per Residential Dwelling Unit By Type Non-Residential Charges 2 Apt 2 Non-

Apt Dwellings Residential Singles or Dwellings with less per Sq. Ft of

Semi- with 2 or than 2 Other Service Cateqory Detached more bdrms bdrms Dwellinqs Other Services Related to a Highw, $470 $298 $210 $380 Protection Services 948 600 425 766 Parks and Recreation Services 5,175 3,269 2,315 4,179 Library Services 1,158 732 519 935 Administration Studies 296 186 133 239 Stormwater Manaqement 307 195 138 248

Total Municipal Wide Services $8,354 $5,280 $3,740 $6,747


Transportation 1 6,952 4,392 3,112 5,612 Total Services Outside of

Seaton Lands $6,952 $4,392 $3,112 $5,612

Seaton $8,354 $5,280 $3,740 $6,747

Rest of Pickering-City wide $15,306 NA NA $12,359

1· Does not apply to Seaton Lands. Seaton Lands subject to a separate agreement outside of the Development Charges Act concerning


NA- See Schedule "D" indexed at 3.3%

Total Floor Area

$0.16 0.35 0.42 0.08 0.11 0.11

$1.23

1.95

$1.95

$1.23

$3.18

2 Implementation of new DCs rates for apartment dwellings units outside of Seaton lands delayed. Per By-law No. 7595/17 section 16(1 )(ii)

Prestige Employment

Land in Seaton (per

Net Hectare) 5,814

12,194 14,146

2,779 3,797 3,738

$42,468

0

0

$42,468

I

I I

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Schedule "D"

City of Pickering

Schedule of Developement Charges for Residential

Apartments Dwelling Units for the Area Outside of Seaton DC By-law No. 7595/17 Effective July 1, 2018

RESIDENTIAL Apt Dwellings with 2 Apt Dwellings with

Service Category or more bdrms less than 2 bdrms

other Services Related to a Highway $230 $168

Protection Services 463 340

Parks and Recreation Services 2,527 1,854

Library Services 566 415

Administration Studies 145 106

Stormwater Management 150 111

Total Municipal Wide Services $4,081 $2,994


Transportation 1 3,394 2,492

Total Services Outside of Seaton Lands $3,394 $2,492

Rest of Pickering-City wide $7,475 $5,486

Effective July 1, 2019 Indexed at 5.20% RESIDENTIAL

Apt Dwellings with 2 Apt Dwellings with Service Category or more bdrms les� than 2 bdrms Other Services Related to a Highway $242 $177 Protection Services 487 357 Parks and Recreation Services 2,658 1,950 Library Services 595 437 Administration Studies 153 112 Stormwater Management 158 117 Total Municipal Wide Services $4,293 $3,150 Outside of Seaton Lands:

Transportation 1 3,570 2,621 Total Services Outside of Seaton Lands $3,570 $2,621

Rest of Pickering-City wide $7,863 $5,771

1· Does not apply to Seaton Lands. Seaton Lands subject to a separate agreement outside of the Development Charges Act concerning


I I

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Ci�of

p](KER]NG


Report to

Executive Committee Report Number: FIN 12-19

Date: June 17, 2019

Subject: Universal City One Developments Inc. - Request to Defer Payment of Development Charges

Recommendation:

1. That Report FIN 12-19 of the Director, Finance & Treasurer be received;

2. That, pursuant to By-law 7595/17:

a) the request by Universal City One Developments Inc. to defer the paymentof the City's share of Development Charges in the amount of approximately$1,739,400 to the earlier of: (i) six months after the commencement offoundation construction at 1474 Bayly Street, Pickering or (ii) when abovegrade construction at the said address is commenced, be approved;

b) that the requirements of Section 14(2) of By-law 7595/17 be waivedaccordingly and that the date of issuance of the final building permit willdetermine the applicable Development Charge rate and, if the final buildingpermit is issued before July 1, 2019, that the payment of DevelopmentCharges will be based on the current rate plus interest, be approved;

c) , that Universal City One Developments Inc., be required to enter into aDevelopment Charge Deferral Agreement with the City on terms satisfactoryto the Director, Finance & Treasurer and the Director, Corporate Services & City Solicitor; and

3. That the appropriate officials of the City of Pickering be authorized to give effectthereto.

Executive Summary: Universal City One Developments Inc. or (UnCity) wants to proceed with construction of its first tower on lands located at 1474 Bayly Street, Pickering. Pursuant to the City's Development Charges By-law 7595/17 (the "DC Bylaw"), the City share of development charges is payable at the time a building permit is issued. The project involves substantial underground construction requiring substantial investment of funds and that is why UnCity has requested a deferral of up to six months of its obligation to pay development charges to the City. City staff recommend approval of the deferral because it will speed up the process of construction of this condominium development. Construction and occupancy of this building will also increase the City's property tax revenues. - 173 -

FIN 12-19

Subject: Universal City One Developments Inc. - Request to · Defer Payment of Development Charges

June 17, 2019

Page 2

The deferral will not result in any reduction in the amount of the development charges paid to the City by developer.

Financial Implications: Deferral of the payment of development charges will not result in any loss of DC revenue for the City. There will be no requirements to secure the deferral. The above grade permit will not issued until the developer makes the full payment to satisfy the remaining DC obligations.

The deferral of development charges delays the receipts of revenue and impacts the cash flow position of the DC reserve funds. In fact, the City may receive higher DC revenues if UnCity's final building permit is issued after June 30th due to the fact DC rates are scheduled to increased effective July 1st

. The economic benefit to Pickering t is the earlier receipt of property taxes for this project. Once fully occupied, this building is expected to generate approximately $370,000 of property tax revenue annually for the City.

Discussion: The Council of the City of Pickering adopted the Report FIN 28-17 of the Director, Finance & Treasurer on the 2017 Development Charges Study and enacted By-law No. 7595/17 of, the City's current DC By-law. The DC By-law requires payment of development �harges prior to issuance of a building permit.

Typically, a municipality will consider a request to defer the payment of development charges when it is in the broader community interest to do so. It should be noted that Council approved DC deferrals for SR&R's three condominium tower project. The SR&R developer has re-branded itself for its six tower project (Universal City).

In the specific request before us, UnCity has requested a deferral to assist it in matching its financial obligations with its funding sources. Construction of a condominium building involves large upfront costs associated with underground works. Funds flow, whether from construction financing or units sales, well after underground work must begin.

This benefits the City by bringing in new residents and has the potential of increasing the economic activity in the City core. Construction and occupancy of this building will also increase the City's property tax revenues. Once fully occupied, this building is expected to generate approximately $370,000 of property tax revenue annually for the City.

UnCity is requesting deferral to the earlier of six months after the commencement of foundation construction or when its above grade work commences. The amount requested to be deferred is $1,739,400 being the City's development charges only. UnCity will have to make separate deferral requests to the Region and the School Board. Total Development Charges payable to the City, Region and School Boards is

- 174 -

FIN 12-19

Subject: Universal City One Developments Inc. - Request to Defer Payment of Development Charges

June 17, 2019

Page 3

estimated to be $6,533,030. From a financial perspective it is not whether or not such a deferral would cost the City, but rather that is it a good business practice to grant this request. UnCity will be required to enter into a Development Charge Deferral Agreement pursuant to the Development Charges Act (Ontario). This Agreement will specify that the development charge amount shall, if unpaid, be added to UnCity's property tax bill and interest charged at 1.25 per cent per month.

Attachments:

1. Universal City One Developments Inc. Deferral Request dated May 15, 2019

Prepared By:

Stan Karwowski, MBA, CPA, CMA Director, Finance & Treasurer


ofJ Tony Prevedel, P.Eng. Chief Administrative Officer


r:::::: -==

� Stan Karwowski, MBA, CPA, CMA Director, Finance & Treasurer

==

- 175 -

ATTACHMENT# _J_

Universal City One Developments Inc.

City of Pickering Pickering Civic Complex One The Esplanade Pickering, Ontario L1V 6K7 May 15 2019

Attention: Mr. Mr. Tony Prevedel - Chief Administrative Officer

Dear Sirs:

Re: Universal City One - Request to Defer Payment of Development Charges

We are proceeding with the development of the first phase of Universal City, Universal City One, a 17 storey residential condominium tower, and have recently filed our building permit application to the City.

The project involves substantial underground construction. We are requesting that the City defer the payment of its development charges until six months after the commencement of foundation construction, or until we commence above grade work. This will assist us in proceeding with the next phase of this important project for the City of Pickering.

City staff has advised that the City's development charges by-law requires payment prior to issuing our foundation permit, unless Council approves otherwise and directs staff accordingly.

As you know, resolutions were passed by the Executive Committee and Council to defer payment of development levies for Building's "A" and "B" of the San Francisco By The Bay development using the same construction triggers. Building "C" of San Francisco By The Bay was also granted a deferral.

150 Ferrand Drive Suite 801, Toronto, ON M3C 3E5

Tel: 416-649-4470 Fax: 416-497-3809

#&let,

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Universal City One Developments Inc.

Please accept this letter as our request, pursuant to Section 17 of By-law 6978/09, that Council approve the deferral of the city development charges applicable to our 17 storey tower project. We request that the charges be payable the earlier of six months after the commencement of foundation construction, or upon the commencement of above grade work, instead of prior to the underground building permit being provided by the City.

Thank you for your consideration of this matter. I would be please to provide anything further to assist in Council's approval of this request, as necessary.

Yours Truly

150 Ferrand Drive Suite 801, Toronto, ON M3C 3E5

Tel: 416-649-4470 Fax: 416-497-3809

I

I I !

al City One Deve pments Inc.

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Subject: 2019 Final Tax Due Date for Commercial, Industrial, and Multi-Residential Realty Tax Classes

Recommendation:

1. That Report Fl N 13-19 of the Director, Finance & Treasurer be received;

2. That the Director, Finance & Treasurer be authorized to issue the final 2019 TaxBills for Commercial, Industrial and Multi-Residential properties with a due date ofSeptember 26, 2019;

3. That the Director, Finance & Treasurer be authorized to make any changes orundertake any actions necessary, including altering the due date, in order toensure that the tax billing process is completed and in order to comply withProvincial Regulations;

4. That the draft By-law attached to this report be enacted; and

5. That the appropriate City of Pickering officials be authorized to take the necessaryactions as indicated in this report.

Executive Summary: Adoption of the above recommendations and passing the attached By-law provides for the final 2019 tax billing for non-residential tax classes (commercial, industrial and multi-residential). During the last few years, the City has billed the final non-residential taxes separately, mainly due to the additional steps that are required as a result of the capping legislation.

Financial Implications: The attached By-law is for the final billing of 2019 property taxes for commercial, industrial, and multi-residential properties. This billing of final non-residential property taxes will raise approximately $33.5 million for the City, Region of Durham, and the School Boards. Tax bills for the residential tax classes were mailed during the last week of May, with due dates of June 26th and September 26th

.

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FIN 13-19

Subject: 2019 Final Tax Due Date for Commercial, Industrial and Multi-Residential Realty Tax Classes

June 17, 2019

Page 2

Discussion: In 1998, the Province introduced Current Value Assessment or CVA on a Province-wide basis to replace the old patchwork system (throughout the Province) where each municipality used a different base year for assessment purposes. The end result of CVA was that some businesses experienced property tax increases well above 100 per cent. To reduce the property tax increases, the Province introduced capping legislation in 1998.

The City of Pickering will soon be in a position to issue the final 2019 property tax bills in accordance with the capping provisions of Bill 140, Continued Protection for Property Taxpayers Act, 2000 and implemented through various regulations (Bill 140 replaced the original capping legislation of Bill 79 introduced and approved in 1998). This legislation was put in place to limit assessment reform related increases to 5 per cent per year on commercial, industrial and multi-residential properties. Under this legislation, property owners facing increases due to property assessment reform had their increases "capped" (reduced). Conversely, those properties experiencing decreases were limited to that permitted under the legislation. This meant that taxes had to be clawed back from those experiencing decreases to fund the loss of revenue resulting from the capped increases.

The funding of the capping protection is paid for on a Region-wide basis. The Region of Durham acts like a banker in this process. For example, the total cost of the capping protection for commercial tax class is paid for by the other commercial properties throughout the Region by having a portion of their property tax decrease withheld (clawed back). As pc;trt of the Region-wide process, the City of Pickering uses a Provincial database program called "Online Property Tax Analysis" (OPTA) to verify non-residential assessment data. Every municipality within Durham Region uses the OPTA system. Assessment Review Board decisions and Minutes of Settlement decisions have been incorporated into the capping calculations up to the "cut-off date" of Apr 1, 2019.

Bill 83 - Legislative Changes to Capping Legislation

In 2004, the Province passed Bill 83, Budget Measures Act, 2004, which provided for various optional tax tools that could be used for the non-residential tax class. In a two tier municipal government structure, the upper tier has the option to select all or some of the tax tools. These tax tools consist of the following options:

1. Annual threshold increase of previous year's annualized taxes raised from 5 per centto 10 per cent.

2. Annual threshold increase capped at 5 per cent of previous year's CVA taxes.

3. Billing threshold established whereby a property that is within the $250 of its CVAbased taxation is required to pay its full CVA property taxes.

4. The minimum CVA tax for new construction properties was 60 per cent in 2006. Newconstruction properties are now fully phased-in at 100 per cent CVA tax.- 179 -

FIN 13-19


June 17, 2019

Page 3

The purpose of these tax tools was to accelerate the movement of non-residential taxpayers to full CVA taxes (such that taxes are calculated using Current Value Assessment multiplied by the corresponding tax rate).

Bill 144 - Legislative Enhancements to Capping Legislation

In 2015, the Province provided additional enhancements to the capping program through Bill 144, the Budget Measures Act, 2015. Beginning in 2016, municipalities are able to increase the annual cap from its current level of 5 per cent of previous year's CVA level taxes up to a new maximum of 10 per cent. In addition, municipalities are able to move properties directly to CVA level taxes if they are within $500 of CVA level taxes, up from the current $250 threshold. The annual cap of up to 10 per cent of previous year's annualized taxes would be maintained.

For 2019, the Region of Durham has adopted all of the tax tools and enhancements referenced above, which will reduce the potential remaining life of this program and the protection requirements.

Under the Municipal Act, Subsection 343(1), the tax bills must be mailed 21 days before the due date. Taxation staff are cognizant of this legislative requirement and design the tax billing process to meet this requirement. The coordinated efforts between OPTA and Durham Region municipalities have accelerated the capping calculation process over the last few years, allowing the capping 'freeze' to be completed earlier in the year.

Table One 2019 Billing Due Dates

February 26 April 26 June 26 September 26 Instalment Dates

Residential X X X X 4 Non-residential X X X 3

As the above table indicates, the residential taxpayer has four instalment dates and the non-residential taxpayer has three dates. In the past, the City has provided indirect cash flow assistance to the non-residential taxpayer by providing them the advantage of skipping the June instalment date, and by having the final instalment due in the fall. This year, taxation staff are recommending that Council continue with the June payment holiday for non-residential properties.

Communication Strategy

In addition to mailing the tax bills, the City will advertise the tax instalment due dates on the City's webpage and in the Pickering News Advertiser prior to each tax due date.

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FIN 13-19


June 17, 2019

Page 4

Attachments:

1. By-law to Establish the 2019 Final Property Taxes and Due Date for theCommercial, Industrial and Multi-Residential Tax Classes

Jones Supervisor, Taxation

Recommended for the consideration of Pickff ;;J) Tony Prevedel, P.Eng. Chief Administrative Officer

Approved / Endorsed By:


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ATTACHMENT#.l_ TO REPORT#fl.tlll-f�


By-law No. XXXX/19

Being a By-law to Establish the 2019 Final Property Tax Due Date for the Commercial, Industrial and Multi-Residential Tax Classes

Whereas it is necessary for the Council of The Corporation of the City of Pickering, pursuant to the Municipal Act, 2001, S.O. 2001, c.25 as amended, to pass a By-law to levy a separate tax rate on the assessment in each property class; and,

Whereas the property classes have been prescribed by the Minister of Finance under the Assessment Act, R.S.O. 1990, ch.A.31 as amended, and its Regulations; and,

Whereas it is necessary for the Council of The Corporation of the City of Pickering, pursuant to the Municipal Act, 2001, S.O. 2001, c.25 as amended, to levy on the whole rateable property according to the last revised assessment roll for The Corporation of the City of Pickering; and,

Whereas the Regional Municipality of Durham has passed By-law No. 22-2019 to establish tax ratios, and By.:.law No. 24-2019 to adopt estimates of all sums required by The Regional Municipality of Durham for the purposes of the Durham Region Transit Commission, and By-law No. 25-2019 to set and levy rates of taxation for Regional Solid Waste Management, and By-law No. 23-2019 to set and levy rates of taxation for Regional General Purposes and set tax rates on Area Municipalities; and,

Whereas an interim levy was made by the Council of The Corporation of the City of Pickering (pursuant to By-law No. 7668/19) before the adoption of the estimates for the current year; and,

Whereas sub section 342 (2) of the Municipal Act, 2001, S.O. 2001, c.25 as amended, permits the issuance of separate tax bills for separate classes of real property for year 2019.

Now therefore the Council of the Corporation of the City of Pickering hereby enacts as follows:

1. For the year 2019, The Corporation of the City of Pickering (the "City") shall levyupon all Property Classes (Residential, Commercial, Industrial and Multiresidential) as set out in Schedule "A" of By-law 7690/19, the rates of taxation, forthe City of Pickering, the Region of Durham and for Education purposes on thecurrent value assessment.

2. Where applicable, taxes shall be adjusted in accordance with the ContinuedProtection for Property Taxpayers Act, 2000, as amended and its Regulations.

3. The levy shall be reduced by the amount of the interim levy for 2019.

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By-law No. Page 2

4. The 2019 final tax capping calculations for the industrial, commercial and multiresidential realty tax classes are based on a freeze date of April 1, 2019.

5. The 2019 taxes owed for the commercial, industrial and multi-residentialassessed properties shall be due in one instalment on September 26, 2019, or asadjusted by the Treasurer.

6. Except in the case of taxes payable under Section 33 and 34 of the AssessmentAct, R.S.O. 1990, c.A31, as amended, the percentage charge as a penalty fornon-payment of taxes and monies payable as taxes shall be added to every taxor assessment, rent or rate of any instalment or part thereof remaining unpaid onthe first day of default and on the first day of each calendar month thereafter inwhich such default continues pursuant to subsections 345 (1), (2) and (3) of theMunicipal Act 2001, S.O. c.25 as amended. The Treasurer shall collect bydistress or otherwise under the provisions of the applicable statutes all suchtaxes, assessments, rents, rates or instalments or parts thereof as shall not havebeen paid on or before the several dates named as aforesaid, together with thesaid percentage charges as they are incurred pursuant to sections 349, 350 and351 of the Municipal Act 2001, S.O. c.25 as amended.

7. If any section or portion of this By-law is found by a court of competentjurisdiction to be invalid, it is the intent of Council for The Corporation of the Cityof Pickering that all remaining sections and portions of this By-law continue inforce and effect.

8. Taxes shall be payable to the Treasurer, City of Pickering.

9. This By-law is to come into effect on the date of its final passing.


David Ryan, Mayor


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