The successful implementation of the Tower Renewal program requires the formation of a new city corporation that can group projects to reduce costs and enforce a payment structure, according to a staff report coming to Monday’s executive committee meeting. “The corporation would have the ability to raise funds and manage the program commercially,” states the staff report submitted by Eleanor McAteer, the city’s tower renewal project manager.
“[The corporation] would provide the administrative structure required that could ultimately manage a multi-billion dollar program, supported by the capital markets.”
First, the city has to request the province to amend the City of Toronto Act so the city can provide start-up funds and allow any default payments to be added to the tax roll. Once the act is amended, the city manager has to recommend a corporate model and reporting relationship to the city. Staff is also providing a Tower Renewal Corporation business case study that outlines the program’s potential return-on-investment. Of the city’s 1,000 apartment buildings that were built between 1945 and 1984, that are characteristically energy-suckers, about 800 are privately owned.
Initial feasibility studies conducted on tower renewal pilot sites show that reductions of 50 per cent of electricity use, 70 per cent of natural gas use and 20 per cent of water use and improvements to waste diversion rates by 30 per cent are possible when implementing the program. However, studies also found that there are many barriers. The biggest one is the estimated capital cost to undertake tower renewal, which is about $4-million for each building.
“Tower Renewal projects will not be undertaken in significant numbers under current circumstances,” the report states.
A guide book—Tower Renewal – Implementation Book —outlines how to engage property owners, collect data, act on short-term retrofits and eventually invest in high-performing retrofits. To address the financing challenge faced by property owners, the proposed new city corporation would enter into financing contracts with building owners. Some funds would be provided by the city—staff estimate an investment of up to $5-million in the first two years of operations—but the majority would be sourced from capital markets. Building owners would have to keep up with payments, which is why the city needs the province to allow any default payments be added to tax rolls.
A staff presentation is scheduled to take place at the executive committee meeting.
For more information, visit Mayor’s Tower Renewal here.