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Tentative but unanimous, council moves forward with new operations facility

Overall project approval to be sought through city's 2024 to 2027 budget process
A revised proposal for a city operations campus in the south end would house transit and fleet services only.

Without knowing firm costs, city council gave staff the go-ahead to continue planning and doing design work for a downsized operations campus in the east end. 

Final approval of the project, loosely estimated to cost between $200 million and $250 million, is expected to come during upcoming 2024 to 2027 municipal budget discussions.

During its committee of the whole meeting on Tuesday, council unanimously agreed to move the project forward on city-owned lands on Dunlop Drive beside the Waste Resource Innovation Centre, near the intersection of Stone Road East and Watson Parkway South.

Despite the unanimous approval, several council members expressed concern about being asked to move this project along without having a clearer picture of what the cost will be.

“It’s difficult right now to support,” said Coun. Christine Billings, referring to the lack of financial details.

“I feel like I have to support this,” noted Coun. Dan Gibson. “I kind of feel like the city is going through a massive renovation.”

This was council’s first opportunity to weigh in on redesigned and downsized operations campus proposal, with public works and building maintenance staff no longer included. The facility would now house only Guelph Transit and the city’s general fleet services.

In late 2019, city council directed staff to develop a business case for the proposed centralized campus, which was estimated at the time to cost in the range of $200 million, that would see a variety of city services amalgamated on that site.

Council endorsed the location in spring of 2021.

Following analysis of environmental and archaeological studies of the site, city staff now proposes a reduced size and scope for the project.

The overall floor area is set at more than 40,000 square metres, with nearly three-quarters of that dedicated to transit services.

If approved, the facility is expected to be built in a phased process over several years.

Following the rise of inflation, deputy CAO Jayne Holmes said the smaller footprint will likely cost roughly the same as previously thought. Estimating the cost at between $200 million and $250 million, she asked council not to hold her to it.

When the matter comes back to council, Coun. Rodrigo Goller told staff he wants to know what the cost of delaying the project would have on existing facilities that are currently at or nearing maximum capacity.

“I’m really concerned that any attempts to delay it will cost us a lot more,” he said, prompting an agreement from staff to bring those figures forward.

"We know things don't get cheaper with time, it only gets more," said Antti Vilkko, the city's general manager of facilities and energy management.

In response to a question from Mayor Cam Guthrie about potential revenue streams for the operations centre, Holmes explained the previous cost estimate was used to build a financing strategy that involved 17 per cent from grants, 48 per cent paid for through development charges, 13 per cent through tax-supported reserve funds and 22 per cent through tax-supported debt.

Much of those grant dollars are to come from the provincial and federal governments who have pledged $74 million toward the cost of electrifying the city’s bus fleet – something council heard is not possible using existing facilities. That grant includes funds toward the purchase of electric buses and isn’t dedicated to the proposed facility.

Tuesday’s committee-approved motion also authorized staff to develop a plan to continue using several other municipally owned sites which had previously been expected to be amalgamated into a larger operations campus.