TORONTO, June 13 /CNW/ - Toronto Mayor David Miller today announced that
he will seek to have the approximately $75 million in City proceeds from the
sale of Toronto Hydro Telecom invested in the much needed repair of Toronto's
public housing. In addition, Toronto Hydro Telecom will continue to provide
the City with significant opportunities for improved public access to
The sale of Toronto Hydro Telecom, a subsidiary of Toronto Hydro, was
announced by Toronto Hydro earlier today.
The exact amount of the proceeds the City will receive as a result of the
sale will be confirmed when the sale has been finalized and Toronto Hydro has
completed its year-end. The City of Toronto is Toronto Hydro's sole
shareholder and Toronto Hydro pays dividends to the City each year. A portion
of the proceeds from the sale of Toronto Hydro Telecom will be part of the
City's 2008 dividend - and will provide the funding for this new investment in
"This new investment is an important step to maintaining our City's
public housing in proper condition," said the Mayor when announcing that he
would seek Council approval for the funds to be used for public housing
repairs. "The investment we are making today will provide the residents that
live in our community housing the dignity they deserve, and allow us to repair
and re-open units that were closed due to unsafe conditions. Making this
investment now reduces costs in future by reducing our reliance on debt.
Investing in our public housing makes Toronto a liveable city and gives those
in need of support the opportunity for a full life."
Using these funds to repair Toronto's aging public housing stock will
mean the City and its housing company, Toronto Community Housing, can complete
long overdue work faster and rely less on debt financing to get the work done.
Toronto City Manager Shirley Hoy stated, "This is a unique opportunity
for the City to leverage the sale of an asset to make long lasting
improvements to the City's public housing and improve accessibility to
Deputy City Manager and Chief Financial Officer Joe Pennachetti stated,
"The use of the City's portion of the proceeds from the sale in this manner
makes good financial sense for the City - reducing the impact of future debt
costs and addressing important infrastructure needs."
Toronto Community Housing has an estimated repair backlog of $300 to
$350 million. This backlog is growing rapidly with the lack of timely repairs
and the aging housing stock. Toronto Community Housing invested more than
$550 million in repairs between 2002 and 2007. This level of expenditure is
the result of fixed-term programs and cannot be sustained beyond 2009. These
programs used borrowed funds and exhausted Toronto Community Housing's debt
The new funds announced today will allow Toronto Community Housing to
refurbish 5,000 more units of housing and retrofit 10 buildings with new
energy efficient building systems.
"This investment represents a big step forward in our capital repair
program and will allow Toronto Community Housing to make very significant
progress in addressing outstanding repairs," said Derek Ballantyne, CEO of
Toronto Community Housing. "This is an investment that is very good news for
our tenants, and the communities where they live."
The sale of Toronto Hydro Telecom and the use of the City's portion of
the proceeds are consistent with the recommendations of the Mayor's Fiscal
Review Panel, which reported last February that a review of assets be
undertaken to ensure the City explores all possible funding options.
Toronto Hydro Telecom owns and operates more than 450 kilometres of fibre
optic network connecting more than 500 buildings throughout Toronto, and owns
and operates the largest WiFi network in North America. The City of Toronto
will continue to retain ownership rights and access to four strands of the
fibre optic network. In addition, the access to critical fibre optic networks
will be available to libraries, community organizations through City
facilities; including services within priority neighbourhoods where public
buildings could be connected to the City's four strands of the fibre optic
network. The fibre optic cable that will be made available to the City will
carry data at an incredibly fast rate of one Gigabit per second - up to
10 times faster than the speed at which data is transferred through typical
residential internet lines.
Toronto Hydro confirmed the sale of the Telecom subsidiary made financial
sense for the company as the proceeds from the sale would increase its ability
to invest in maintaining a strong, safe, reliable and sustainable electricity
system. "This sale enhances our ability to invest in the renewal of our
distribution system," said David O'Brien, President and Chief Executive
Officer of Toronto Hydro Corporation.
In addition to the dividend funds received from the sale, the City of
Toronto will also receive $5 million from Toronto Hydro Telecom as part of the
municipal access permit agreement. These funds will be directed to offset the
cost of future initiatives aimed at improving telecommunications
infrastructure and accessibility across the city.
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Toronto Community Housing repair program
Toronto Community Housing inherited a large capital repair backlog when
it was created in 2002 following provincial downloading. A majority of Toronto
Community Housing's units - 45,000 of 58,500, came from the provincial
government or were funded by the Ontario Housing Corporation, and had no
capital reserves for repairs. Ongoing deferral of major repairs due to a lack
of funding has resulted in a $300-350 million repair backlog which continues
to grow because of inflation and the fact that the repairs become more
expensive the longer the work is deferred.
Since 2002, Toronto Community Housing, with the assistance of the City of
Toronto has been able to invest $550 million to repair and replace outdated
housing units and building systems. In addition, Toronto Community Housing
with the support of the City is investing in the revitalization of Regent
Park. These investments have not only improved the quality of housing for
Toronto Community Housing's tenants, but have also contributed to a
significant reduction in energy use. The savings from reduced utility costs
have been used to finance borrowing for repairs. A Toronto Community Housing
bond issue in 2007 also raised $250 million for the complete rebuilding of
social housing in Regent Park and Don Mount Court.
The $300-350 million backlog represents work that Toronto Community
Housing has not been able to undertake because of lack of funds. In addition
to the new funds announced today, the Ontario government recently committed
$36 million to the City of Toronto for repairs to social housing. Canada is
the only major western nation without a real national affordable housing
program. The City of Toronto, the Federation of Canadian Municipalities and
the provincial and territorial governments are all encouraging the national
government to invest in this essential part of our national social
Toronto Community Housing is Canada's largest social housing provider and
home to more than 164,000 tenants with low and moderate income - about six per
cent of the City of Toronto's population. These families, individuals,
seniors, and people with special needs reside in 58,500 households in
communities throughout Toronto.
For further information:
For further information: Media contacts: Don Wanagas,
(firstname.lastname@example.org), Director of Communications, Office of Mayor David
Miller, (416) 338-7134; Kevin Sack, (email@example.com), Director, Strategic
Communications, City of Toronto, (416) 397-5277; Kristin Jenkins,
(firstname.lastname@example.org), Vice-President, Public Affairs, Toronto
Community Housing, (416) 981-4340; Blair Peberdy, (email@example.com),
Vice-President of Communications and Public Affairs, Toronto Hydro
Corporation, (416) 542-2515