Mayor Cam Guthrie is wondering if plans for a $197.4 million centralized hub for the city’s transit, fleet and maintenance operations be scaled back in light of the pandemic.
The mayor poses the question as city staff work to finalize a business plan in support of the proposal.
“This question should be top-of-mind for all levels of government,” he said, “do we need all that office space now? … Can that money be saved because people can still do their job but don’t have to have the office space that taxpayers had to pay for to begin with?”
Guthrie acknowledges much of the proposed operations hub on city-owned land beside the Solid Waste Management facility on Dunlop Drive would be garage space, but learning that staff plan to present a business case to council soon has him wondering.
“I really do want to make sure that the business case brings forward something that is a clear path forward,” he said. “I have always been concerned that this is such a large project. The business cases really need to be fleshed out.”
City staff proposed the idea of a central operations hub in 2019, prompting council’s direction to prepare a business case for it. That report was to be presented last November, but that’s been delayed due to staff’s focus on pandemic-related issues, states a city document released on Friday.
Antti Vikko, the city’s general manager of facilities and energy management, said the business case and staging plan will be presented to council on May 3.
Guthrie hopes that business case will answer many questions to help him, along with the rest of city council, decide if an amalgamated operations hub is the way to go. The vast majority of those questions involve dollar signs:
How much of the cost would be covered by grants and development charges as opposed to city taxpayers?
What’s the impact on the city’s corporate debt? Given low interest rates now, is there savings to be had if the project happens sooner rather than later?
If the hub goes ahead, what’s the savings from upcoming maintenance at current facilities? Should the current facilities be sold to help cover the capital cost of a new hub? What long-term benefit would selling those facilities – “turning under-performing assets into performing assets, similar to the Baker Street development” – bring to the city, its residents and the local economy?
What reduction in operating budgets and efficiencies can be realized by amalgamating various departments into a hub? Do those annual savings offset the upfront capital costs?
“These are just some of the things that I would love to have addressed,” Guthrie said, noting the initial “sticker shock” made him and other council members “really sit back in our chairs.”
The private sector often uses business plans to help decision-makers plan for the future, he adds. “We need that same type of scrutiny through business plans in the public sector, government as well.”
A large portion of the operations hub would be dedicated to the city’s transit operations, for which the provincial and federal governments have pledged $74 million of the estimated $178 million cost of expanding and electrifying the city’s bus fleet. Building a new transit operations centre is part of that.
Also delayed due to the pandemic is a staff report to council regarding future uses and operation of the city’s sports dome on College Avenue West, beside Centennial Park Arena. That report was initially set for completion last June. It’s now expected in the second quarter of this year.
The city became owner of the dome in 2019 after it paid off the remaining $250,000 loan on the facility after Guelph Community Sports (GCS), which was established to oversee operation of the dome, defaulted on its agreement with the city, explained a staff report at the time.
It will be up to council to decide whether the city’s parks and recreation department will operate the dome or if a request for proposals will be issued for its operation. A third option could see the removal or sale of the dome.
