Staff Report #1
February 27, 2019
To All Commissioners
Re: Strategic Assessment of LTC Facility Needs and Path Forward
That the Commission:
i) APPROVE IN PRINCIPLE the Strategic Assessment of LTC Facility Needs and Path Forward
ii) DIRECT administration to utilize the Path Forward as input into the preparation of multi-year Operating and Capital budgets which will include the identification of sources of funding; and
iii) DIRECT administration to report back on an implementation plan with respect to the Highbury facility.
In August 2016, the Commission approved a number of projects under the Public Transit Infrastructure Funding program, one of which was the completion of a Strategic Assessment of LTC Facility Needs and Path Forward Study giving consideration to the state of the existing facilities and the planned growth in services over the next 30 years. The two facilities currently in use provide for both operations and maintenance (O&M) activities which accommodate the various administrative, operations and vehicle maintenance functions including storage for the conventional transit fleet and the management of the specialized transit service. The main facility is located at 450 Highbury Avenue North and the second, smaller “satellite” facility is located at 3508 Wonderland Road South. The Highbury Avenue facility was originally constructed in 1950 as a manufacturing plant and was purchased by the LTC and converted for transit purposes in 1972/73. The Wonderland facility was constructed as a purpose-built building and opened in 2011.
The LTC undertook a Strategic Assessment of its future facility needs in 2006 which led to the construction of the Wonderland facility to provide needed operations and fleet storage capacity and to relieve vehicle maintenance and storage conditions at the Highbury facility. At that time, it was recognized that the Highbury facility would need to be addressed in the future. As a detailed assessment had not been completed, a placeholder amount of $40 million was included in the Commission’s capital budget program, spanning the years 2022 through 2028.
The Strategic Assessment of LTC Facility Needs study report (see Enclosure I) confirms the LTC’s future facility needs based on projections of service, fleet and employee growth, and assesses options for replacing the Highbury facility including the option of a new site.
The first aspect of the review to be undertaken was an assessment of the Highbury facility; a number of the key findings are set out below:
- The main buildings are now 70 years of age and well past their economic and design life;
- The building materials and, particularly, the concrete floors in the maintenance and storage areas, are in poor condition and deteriorating;
- The workplace areas and environment are sub-standard to current, modern facilities; and
- The existing buildings are energy inefficient and the interior layout, particularly in the maintenance and storage areas, presents on-going operational challenges.
Modifications and additions undertaken in 1990/91, 1993/94 and 2002/03 increased vehicle storage space, servicing and maintenance capacity as well as administrative office space. However, because of the design of the original structure, particularly with respect to roof height, spacing of column supports within the building and the office layout, the use of the building as a bus garage has involved compromises in the location of the vehicle maintenance, storage, servicing functions and in the layout of the parts repair, stockroom and office areas. As well, the location and orientation of the original building on the site has meant that separate buildings have had to be constructed to accommodate added vehicle storage and servicing and maintenance requirements rather than having these functions conveniently grouped together.
The next step in the review involved determining the future facility needs with respect to the number of buses and employees anticipated to be operating out of each facility. Future growth plans, including the implementation of bus rapid transit corridors were included as part of this consideration. The fleet size estimates for various horizon years are set out below, noting the bus numbers are expressed in standard bus equivalents (SBE’s), taking into account that an articulated bus is approximately 50% longer than a standard 40’ bus. The fleet size estimates are intended to be an order of magnitude based on known plans to date, noting any expansion will be subject to the availability of operating and capital funding requirements.
|Estimated Fleet Size (SBE)
Fleet size and total employee estimates were utilized to determine the size of facility that would be required to meet future needs.
Once the size of the facility was determined, the next step in the process was to identify options to meet the need. Two options were identified for assessment; rebuild a facility on the current location or build a new facility at a new location and sell the existing facility upon completion. Given the site size requirement of 7.2 hectares, identifying vacant sites in London was challenging. The review identified two sites in southwest London, and also conducted an assessment for comparative purposes on a theoretical site in the vicinity of Oxford Street and Veterans Memorial Parkway.
Based on these site locations, an analysis was undertaken with respect to the “deadhead” costs (the operating costs associated with buses travelling to the start of service and back to the garage when they are not in revenue service) of operating out of each of the identified locations. The southwest location as compared to the existing Highbury location would cost an annual operating premium of approximately $633,000 today, increasing to $867,800 by 2047. A northeast location would have a higher annual operating cost premium of $996,300 today, increasing to $1,378,000 by 2047. The difference between the southwest and northeast locations reflects the fact that a northeast location would be more remote from the centre of the LTC’s service area requiring buses to travel further. Extending these estimates over the horizon period to 2047 results in an estimated additional operating expenditure of $18 million for the southwest location and $28 million for the northeast location.
Given the significant incremental costs associated with moving the facility, a detailed assessment of the feasibility of constructing a new facility at the existing Highbury location was undertaken. The complicating factor with respect to this option is the need to continue to be able to service and maintain a significant portion of the fleet while construction is ongoing. A number of options were considered during this assessment phase, with the final recommended strategy being to rebuild on the Highbury site in a phased manner, providing the ability to continue to service and maintain buses while construction is ongoing. The phasing plan would require the relocation of employee parking as well as the need to secure an indoor heated facility to park buses overnight for an extended period of time. This plan would also require a number of the buses currently operating out of the Highbury facility to be transferred to the Wonderland facility during the construction period.
While this path forward is extended and more complicated as compared to a new build, it is the most cost effective when considering the all in costs associated with both the build and the annual ongoing operating costs.
The estimated operating and capital costs associated with the recommended path forward are $6 million and $167 million respectively. As previously mentioned, the Commission’s current capital budget includes a placeholder amount of $40 million related to facility replacement. Additionally, the BRT plan includes approximately $14 million relating to the required facility expansion relating to the implementation of the BRT. As set out in the report recommendation, subsequent to approval in principle of the path forward, administration will work to include revised budget estimates into both future operating and capital budget projections including the identification of potential sources of funding.
Mike Gregor, Director of Finance
Craig Morneau, Director of Fleet & Facilities
Concurred in by:
Kelly S. Paleczny, General Manager