Real Property activities: Standing Committee on Government Operations and Estimates—June 2, 2021

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Real Property Services efforts in support of vulnerable populations affected by the COVID-19 pandemic

Background

People experiencing homelessness or who are part of a vulnerable population have an increased risk of contracting and transmitting COVID-19 due to overcrowded living conditions, inability to self-isolate, the lack of access to facilities to practice good hygiene and a higher incidence of transience.

Role of Public Services and Procurement Canada

Public Services and Procurement Canada (PSPC) is supporting the needs of vulnerable populations by leveraging its real property expertise and holdings to ensure access to facilities and accommodation for a range of eventualities. In April 2020, PSPC and Employment and Social Development Canada (ESDC) created the Interdepartmental Committee on Lodging for Vulnerable Populations to implement a whole-of-government approach with the involvement of representatives from 14 departments.

Issue

PSPC is not funded to provide lodging for vulnerable populations. Therefore, our support involves sharing expertise, working with interjurisdictional partners and national associations, coordinating with funding departments, including the Treasury Board of Canada, for real property exemptions, and providing ongoing support as urgencies arise to navigate the appropriate lodging and specialized services support channels.

As border restrictions change throughout the pandemic, PSPC is supporting Immigration, Refugees and Citizenship Canada to secure hotel facilities across Canada. PSPC also provides advice and best practices to Health Canada, ESDC, the Public Health Agency of Canada (PHAC), the Privy Council Office (PCO) and our interjurisdictional partners related to housing needs for temporary foreign workers or asymptomatic isolation sites to ensure that the responses build on lessons learned throughout the pandemic and barriers within the industry.

On the specific topic of lodging and supporting Indigenous populations, Indigenous Services Canada (ISC) is integrated through its involvement as an active member of the Interdepartmental Assistant Deputy Minister (ADM) Committee for COVID-19 Lodging Vulnerable Populations, which PSPC co-chairs. ISC is also well integrated with ESDC as a major partner for the Reaching Home Program, from which PSPC has been receiving formal requests when lodging is a requirement. These requests are triaged and supported when feasible. 

PSPC has also provided support on an emergency basis to ISC through the Government Operations Centre (GOC). For example, when one of the communities in Manitoba suffered a COVID-19 outbreak last year, PSPC was able to suggest support for that specific community. In the end, however, local solutions were deployed. 

PSPC Western Region is also well integrated with provincial emergency response committees and, therefore, receives direct requests and provides advice on an ongoing basis.

Current status

PSPC has received 11 formal requests and at least 10 informal requests through a newly-developed intake process to triage lodging requests and determine which federal partners are best positioned to support the community needs through space, funding and best practices support. PSPC addressed several of the lodging requests while remaining requests have been managed by ESDC through community support programs or the Canada Mortgage and Housing Corporation’s (CMHC) rapid-housing initiative.

PSPC currently has 3 leases in place until September 30, 2021, at nominal value. The City of Montréal has a lease in place to use a facility located in the Guy-Favreau Complex, the non-profit organization Bon Courage has a lease for the former National Film Board of Canada building in Montréal and the Northwest Territories Housing Corporation is using the Aspen Apartment complex located in Yellowknife (a 36-unit building). PSPC has also received pre-approvals to lease another vacant Crown-owned site in Yellowknife to be used as a potential warming shelter. In addition, PSPC has recently been asked by the City of Yellowknife to use 14 vacant housing units for a period of 1 year to house homeless populations displaced by the COVID-19 pandemic and is currently working with ESDC to seek the appropriate authorities. Lastly, a request from the Santé publique du Québec to use the Manège militaire’s rooms as a COVID-19 vaccination site is currently being addressed.

Risks

PSPC is not funded to provide lodging at the community level. Therefore, role clarity, triage and coordination of requests are critical and ongoing to ensure expectation management and to avoid duplication of response efforts.

Next steps

PSPC will continue to support ad hoc and formal requests throughout the third wave and the vaccination period to help respond to evolving situations and emergencies. Treasury Board authorities for existing and emerging lease requirements are being sought to extend them beyond the vaccination period and required decommissioning phase.

Federal building management during COVID-19

Context

A large proportion of the public service has transitioned to working from home during the COVID-19 pandemic. Government offices remain open to ensure the delivery of essential government functions and many clients’ preparations for eventual return to the workplace are underway, guided by regional public health agencies. However, with Canada in the third wave of the COVID-19 virus, there may be a heightened concern about how confirmed cases are being managed and communicated to Public Services and Procurement Canada building occupants.

Note

Questions on employees returning to the workplace should be responded to by the President of the Treasury Board, as the employer.

Suggested response

If pressed on confirmed cases in PSPC buildings:

If pressed on notifying employees of confirmed cases of COVID-19:

Background

Cleaning costs

Base building cleaning costs have remained relatively stable throughout the pandemic, seeing an increase of about 9%, despite augmented cleaning protocols. However, as the gradual return to the workplace progresses, base building cleaning costs are expected to rise. While there are different factors to take into consideration, it is estimated that an increase in cleaning costs will be realized when occupancy levels reach approximately 30% of total occupancy. We continue to engage service providers and landlords on these costs for planning purposes.

Utility costs

While reduced occupancies may suggest lower utility costs, the reality is that utility costs have remained stable when compared to pre-pandemic values. This is attributed to numerous variables including:

Jurisdictional restrictions

PSPC endeavors to remain informed on local health restrictions that could impact our real property portfolio and the clients within. Heightened restrictions have recently been announced in 3 provinces to reduce community transmission of COVID-19: British Columbia, Quebec and Ontario.

Since the declaration of the pandemic, PSPC assets have remained open so essential government functions can be delivered in a safe environment. This same direction will be applied during the jurisdictional restrictions mentioned above as well as any other jurisdictions where restrictive measures may be introduced in the future.

Next steps

The department continues its engagement with central agencies, clients and bargaining agents to collaborate on guidance. PSPC will also continue to advance procedures to ensure healthy and productive work environments for the easing of restrictions and planning a safe return to the workplace as guidance evolves.

PSPC will continue to reinforce reporting protocols for suspected and confirmed cases of COVID-19 cases with service providers and clients to ensure a consistent national approach and understanding.

PSPC will continue to track building readiness measures nationwide and take advantage of opportunities to demonstrate building readiness protocols for instilling greater confidence and reducing uncertainties within our client community.

In addition, as part of the Minister’s supplementary mandate letter, she has been asked to, in consultation with public sector unions, work with the President of the Treasury Board and the Minister of Digital Government to explore enhanced flexibility in working arrangements for federal public servants.

PSPC will continue to reinforce guidelines for non-essential lighting internally and with real property service providers.

Rent relief measures for commercial tenants in the Public Services and Procurement Canada portfolio

Context

Public Services and Procurement Canada has put in place measures to alleviate financial pressure on its commercial tenants during a period of low-building occupancy brought on by the COVID-19 pandemic.

Suggested response

Background

Given the health and safety measures put in place to contain COVID-19, buildings under PSPC’s management are largely empty. As a result, commercial tenants may have experienced reductions in their business volumes.

In line with guidance from the Treasury Board Secretariat (TBS) on rent relief to external tenants, PSPC took steps to allow tenants to defer their rent payments for a 6-month period effective April 1, 2020. This applied to businesses whose income had been affected by the COVID-19 containment measures. To date, rent deferrals were sought by 162 tenants (64% of tenants) for a total of $4.8 million for the 6-month period.

In addition, 106 tenants (58% of potentially eligible tenants) benefited from the Canada Emergency Commercial Rent Assistance  75% rent reduction for a total of $1.8 million. The CECRA Program terminated on September 30, 2020.

On October 9, 2020, the government announced the Canada Revenue Agency-administered CERS Program, which replaced the CECRA Program and provides simple and easy-to-access rent and mortgage support for qualifying organizations affected by the COVID-19 pandemic. The rent subsidy is provided directly to affected tenants while providing support to property owners. The CERS subsidy is currently available until June 2021. Budget 2021 proposes to extend support until September 25, 2021.

The rent subsidy supports businesses, charities and non-profit organizations that have suffered a revenue drop by subsidizing a percentage of their expenses, on a sliding scale, up to a maximum of 65% of eligible expenses and top-up of up to 25% for organizations temporarily shut down by a mandatory public health order issued by a qualifying public health authority.

In addition to leveraging the CECRA and CERS programs, PSPC will also be amending lease agreements on a temporary basis, as appropriate, to ensure that future rents reflect the economic realities of its tenants.

Lease amendments contemplated include calculating rent as a percentage of tenants’ gross revenues (for example, rent becomes relative to their ability to generate revenues and their ability to pay) and mutual termination without penalty to relieve tenants of any future financial obligations should they believe their business model is no longer sustainable.

Place du Portage III asset and workplace renewal project

Context

A major renovation to Place du Portage III (PDP3), originally approved in 2018 and planned to be completed in 2026, is underway, with the construction phase scheduled to begin in summer 2021.

Suggested response

If pressed on the Ontario and Québec occupied space ratio:

Background

PDP3 consists of 3 main towers: A, B, and C, as well as 2 smaller towers, D and E. Together, these 5 towers provide 88,668 m2r of office space, as well as commercial areas, 4 basement levels and a tri-level underground parking garage.

The PDP3 asset and workplace renewal project will deliver a complete building rehabilitation and modernization of base building elements, the workplace, and security and information technology (IT) components, while considering Government of Canada priorities, including deep greening and Gender-based Analysis Plus (GBA+) measures, such as universal accessibility, inclusivity, and wellness.

This major capital project, which is taking place between 2018 and 2026, is expected to generate approximately 13,500 direct/indirect/induced person years of employment, thus stimulating the post-pandemic economy.

At this time, planning studies have been completed and design is underway. The relocation of staff impacted by the construction activities is nearly complete, and selective interior demolition of the Western towers is nearing completion. Reconstruction will begin in the Western towers and is expected to commence in summer 2021.

PSPC assesses its real estate portfolio strategically on a cyclical basis, and has determined that PDP3 will continue to be used to accommodate public servants for the foreseeable future, despite the pandemic.

National Capital Region bridges

Context

Budget 2019 provided funding for the replacement of the Alexandra Bridge, the rehabilitation and ongoing maintenance of the MacDonald-Cartier Bridge, and the Chaudière Crossing. It also provided direction for the refresh of technical studies on a potential sixth interprovincial crossing in the National Capital Region (NCR) and for the development of a long-term integrated interprovincial crossings plan.

Suggested response

If pressed on the long-term integrated interprovincial crossings plan:

If pressed on a sixth crossing:

If pressed on replacing the Alexandra Bridge:

If pressed on interprovincial tramway connections:

Background

There are 5 interprovincial crossings in the NCR. PSPC manages and operates the Alexandra Bridge (built in 1900), Chaudière Crossing (portions built in 1828, and Union Bridge built in 1919) and the Macdonald-Cartier Bridge (built in 1965). The NCC manages and operates the Champlain Bridge (built in 1928) and the Portage Bridge (built in 1973).

Transportation studies conducted over the last 10 years have consistently shown that the 5 existing crossings and connecting roadways are at full capacity during morning and evening peak travel times (average daily traffic on all crossings: 187,000 vehicles daily; 9,000 using active transportation). That being said, the long term integrated interprovincial crossings plan will take into consideration the impacts of COVID-19 on peak hour capacity requirements due to potential changes in working patterns.

Long term integrated interprovincial crossings plan

In providing the way forward to achieve the vision and goals of the plan, the following areas will be addressed:

Sixth crossing

Budget 2019 directed the NCC to “Address the demonstrated need for an additional NCR crossing by refreshing existing studies and developing a long-term integrated interprovincial crossing plan with both provincial governments and the cities of Gatineau and Ottawa.”

With regard to the first commitment, the NCC has completed a refresh of existing technical studies on 3 potential corridors:

The scope of the refresh included the following 8 technical studies:

The purpose of the refresh was not to recommend a specific corridor. Any next steps on a potential sixth crossing project will depend on further planning activities and would leverage the results of the long-term integrated interprovincial crossings plan due to be completed in late 2021.

In addition, following a commitment in Budget 2019, WSP Canada Group Limited was awarded a contract by the NCC to refresh the 2013 technical studies on a potential sixth crossing at a cost of approximately $440,000

Again, the purpose of the refresh was not to recommend a specific corridor, but rather to inform any future government consideration of a sixth crossing project

Separately, PSPC engaged WSP Canada Group Limited to assist with conceptual designs, cost estimates, and a refreshed assessment and evaluation of 3 potential corridors, for internal use to inform departmental work (this work cost $1,384,037). These reports relied on the findings of the NCC’s refresh studies.

Alexandra Bridge

A 2017 third-party life-cycle cost assessment concluded that replacing the 120-year-old Alexandra Bridge is the most cost-effective alternative, as it will have reached the end of its life span within the next 10 years. It also determined that replacing the bridge would be less disruptive to the public than trying to maintain the existing bridge.

A structural evaluation of the bridge (completed in March 2020) revealed that due to the deterioration of several bridge members, load restrictions were required. Its replacement has become more critical after inspectors found an unexpected structural flaw, which forced the bridge’s closure for several weeks in 2020, for emergency repairs. Other repair projects are planned and will be completed to ensure the bridge remains safe and accessible until its replacement.

The preliminary cost estimates of the various options were also released, although they are not final and may increase over time.

PSPC has begun activities related to planning, impact assessment and design.

Chaudière Crossing upcoming works

Planned projects include the widening of the Hull Causeway and a major rehabilitation for the 100 year old Union Bridge. The work will take place from June 2021 to September 2022. An outcome of this work will be dedicated cyclist lanes across the entire crossing as part of a complete street. Traffic will be limited during the construction period to public transit, northbound traffic to Gatineau, and active transportation, that is foot and cycle traffic. Trucks over 33 tonnes will be detoured to the MacDonald-Cartier Bridge. Partial lane closures will be required on Chaudière Crossing to allow work by stakeholders nearby to proceed safely in advance of PSPC’s upcoming projects.

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