3 REGIONAL MUNICIPALITY OF OTTAWA-CARLETON MUNICIPALITÉ RÉGIONALE D OTTAWA-CARLETON REPORT RAPPORT Our File/N/Réf. Your File/V/Réf. DATE 23 December 1996 TO/DEST. FROM/EXP. SUBJECT/OBJET Co-ordinator Community Services Committee Commissioner Social Services Department REQUESTS FOR CHILD CARE CAPITAL FUNDING DEPARTMENTAL RECOMMENDATIONS That the Community Services Committee recommend Council approve: 1. A capital grant to New Edinburgh Child Care Centre in the amount of $210,000 conditional on provincial approval for the release of funding for the construction of a new child care facility and; 2. A capital grant to Garderie Sunflower Co-operative up to a ceiling of $85,000, with the final amount to be determined by actual costs less any provincial contribution and; 3. That $295,000 be transferred from the Child Care Contingency Fund to the Child Care Capital Reserve Fund for this purpose. BACKGROUND The system for funding child care capital needs is currently in transition in the Province of Ontario. The goals of the Provincial Child Care Review are to insure quality, affordable care, focused on those most in need, within a flexible system balanced between the private and nonprofit sectors. All provincial capital allocations have been frozen pending the outcome of this review.
4 The Region has been a funding partner in meeting the child care capital needs of the community by providing up to 20% of provincially approved projects. Capital needs that require action before the conclusion of the provincial review exist for two centres, New Edinburgh Child Care Centre and Garderie Sunflower Co-operative. PROVINCIAL ROLE IN CHILD CARE CAPITAL FUNDING The Provincial government has provided the lead role in capital funding for child care centres, assessing applications and determining capital priorities. Funding was first provided for capital expansion on a 50/50 basis between the provincial government and the child care program. It was then increased to 80/20, and finally under the Jobs Ontario program capital expansion was 100% provincially funded. Through the Program Development Fund, one-time funding has been available on an 80/20 basis for program moving and related start-up equipment costs. In June of 1995, the Ministry of Community and Social Services placed a freeze on all child care capital funding pending the outcome of the Provincial Child Care Review. A discussion paper outlining proposals for reforming the child care system was released in September of 1996. Included in those proposals was a section on capital funding which suggested that the Province should only provide a limited amount of 50% capital funding for health and safety related projects. Responsibility for capital expansion would be returned to the private and non-profit sectors. The Region as well as many other groups have expressed their concern that this policy would curtail expansion and jeopardize existing programs requiring capital funding to relocate. The consultation phase is complete and the announcement of new provincial child care policies are anticipated in 1997. RMOC CHILD CARE CAPITAL FUNDING POLICY In 1987, the Region adopted a policy on capital funding for child care centres. The policy responded to the challenges non-profit programs were facing in raising the balance of the project costs once provincial funding was secured. The intent of the policy was to enable the development of new child care spaces in under-served areas of the Region and to provide funding to existing centres where relocation or renovations were required to satisfy the Day Nurseries Act. A reserve fund was created and criteria established for the receipt of funds. The criteria include the following: a) a requirement that centres receive financial support from the Province; b) a formula for cost sharing based on an 80% Provincial contribution and Regional contribution of up to 20%; c) provision for the allocation of funds available, based on a priority rating developed by the Social Services Department;
5 d) a requirement for security arrangements to provide for repayment of the RMOC equity on a proportionate share basis should the centre be sold or cease to operate. Since 1987, as a result of the implementation of this policy, funding has been provided to 13 different groups. These funds have been utilized to renovate 3 buildings and create 10 purpose built facilities, providing a total of 863 spaces. CURRENT REQUESTS FOR CAPITAL FUNDING In September 1994, two child care programs in the Region received provincial capital grant allocations to build new facilities. New Edinburgh Child Care Centre was provided a grant of $1.9 M and the Centre multi-services, a partnership of three non-profit groups who provide services to Francophone children, parents, families and early childhood education professionals, received a commitment for $2.2 M. The Centre multi-services was unable to secure suitable land prior to the provincial capital funding freeze, and is awaiting provincial direction before proceeding further with their project. The Region also has funding requests on file from three programs that have not secured a provincial funding commitment: Youville, Children s Place and the Children s Centre. Garderie Sunflower Co-operative has requested capital funding from the Region to move, renovate and equip a new leased space. They have been asked to vacate the space they currently occupy by March 31, 1997. This report addresses the funding requests from New Edinburgh Child Care Centre and Garderie Sunflower Co-operative. NEW EDINBURGH CHILD CARE CENTRE The New Edinburgh Child Care Centre is a centre based program that offers care to a total of 66 preschool, kindergarten and school age children. Approximately one third of their spaces are subsidized. The centre has been renting space at the Crichton Street Public School for 15 years, however, as enrollment in the school has increased, the Ottawa Board of Education has placed increasing pressure on the program to find alternate space. As a result, since September of 1996 the New Edinburgh program has been split in two locations; the preschool program is temporarily renting space in a school in Manor Park while the kindergarten and school age programs are operating from Rockliffe Park Public School. The division of the program in two locations has required the Ottawa Board of Education to provide busing services. In September 1994, New Edinburgh received approval of $1.9M in capital funding from the previous Provincial government to build a new child care facility. In October 1994, the sum of $775,000 was advanced to New Edinburgh in order to purchase land for the building. While the particular property deal did not work out, the funds are still held by New Edinburgh.
6 In September 1995, New Edinburgh Child Care Centre became a facilitated program under the auspices of the Ottawa Board of Education (OBE). OBE facilitated child care programs are managed by a Board of Directors, but the Principal of the school where the program is located, as well as the Child Care Coordinator for the OBE also sit on the Board as non-voting members. All OBE facilitated programs have the same personnel policies and benefits from centralized administrative services. Subsequent to New Edinburgh becoming a facilitated program, the OBE and the Village of Rockliffe Park have agreed that New Edinburgh could build onto Rockliffe Park Public School in order to relocate all of their programs in one location. The Village of Rockliffe Park will contribute a 25 foot easement on the land while the OBE will lease the land for $1 a year for the next 40 years. The cost of the new facility is estimated at $1.053 M. New Edinburgh is requesting a Regional contribution of $210,000, which represents 20% of the capital cost. The balance of the required funding, $88,000 will come from fundraising and other sources. Due to the freeze placed on provincial child care capital funding, New Edinburgh Child Care Centre has not been able to access the remainder of the capital funds announced by the Ministry in 1994, nor do they have permission to proceed with construction using the $755,000 already in their possession. The centre is hopeful that through Regional approval of a 20% capital contribution the Province will approve the use of the $775,000 for the project. The Department supports the proposal from New Edinburgh to build onto Rockliffe Park Public School. The current situation of programming being divided between two temporary locations is not efficient. The partnerships contained in this proposal provide significant savings over the previous proposal to address New Edinburgh s space requirement. There continues to be a demand for subsidized child care in the area of the Region served by this centre. A 20% Regional contribution of $210,000 is therefore recommended, conditional on provincial approval to utilize the funding New Edinburgh has received. GARDERIE SUNFLOWER CO-OPERATIVE Garderie Sunflower Co-operative is a centre based bilingual program, providing 47 toddler and pre-school spaces in the community. Since 1979 the centre has rented space from the City of Ottawa in the St. Pierre Community Centre on Friel Street. In August 1995 the City of Ottawa declared the St. Pierre Community Centre surplus to corporate requirements. The City report on this item stated that they would seek to ensure that the Garderie Sunflower Co-operative be accommodated by the eventual purchaser, although this may not be feasible. A potential purchaser expressed an interest in purchasing the Friel Street property and retaining Garderie Sunflower Co-operative as a tenant. The City of Ottawa notified the Garderie Sunflower Co-operative that a new three year lease, to take effect January 1, 1996, based on market rent would be drawn up. The new lease contains a standard six month cancellation clause. However, the City inserted an additional clause stating that if the property was sold the lessor would provide in the agreement of purchase and sale that Garderie Sunflower Co-operative would remain in occupancy until the expiration of their lease.
7 This lease was signed, creating the reasonable expectation on the part of the child care program that their occupancy was secure until December 31, 1998. Subsequently the original purchaser did not purchase the property. The City entered into an agreement of Purchase and Sale with a new party on July 3, 1996. The purchaser, as a condition of sale inserted a clause requiring that the purchaser take vacant possession of the property. The City deferred the closing of the sale until March 31, 1997 to allow for six months notice to Garderie Sunflower Co-operative of the cancellation of their lease in accordance with the terms and conditions of their lease. City staff have assisted Garderie Sunflower Co-operative with finding a new rental location. A suitable site has been found in an Ottawa Roman Catholic Separate School Board (ORCSSB) school, located at 88 Main Street in the City of Ottawa. City staff negotiated, on Garderie Sunflower Co-operative s behalf, a five year lease with an option to renew for a further five year term. A preliminary concept design prepared by city staff, estimate the fit-up and relocation costs at approximately $85,000 to meet the requirements of the Day Nurseries Act. There are likely costs which have not been identified at this stage in the planning process. In relocating to the Main Street space Garderie Sunflower Co-operative will incur approximately $33,000 in increased rent for the period covering the balance of their lease the city terminated. City Council, on December 18, 1996 approved a grant covering the difference in rent under the new lease. Along with the free staff assistance, the City believes this arrangement is fair compensation for the early termination of the lease. City staff have also had discussions around the possibility of Garderie Sunflower Co-operative applying for a Self Help Grant from the City for playground improvements. This grant provides assistance up to $7,500 based on a 50/50 split of project costs and is subject to Council approval. The adjacent playground at 88 Main Street is on ORCSSB land, but contains city owned equipment. Garderie Sunflower Co-operative has been given exclusive use of the adjacent playground during their hours of operation. The playground structures need improvements to meet the requirements of the Day Nurseries Act. Previously, Garderie Sunflower Co-operative would have been eligible for an 80% provincial contribution for moving and start-up equipment costs under the Program Development Fund. This funding stream has been eliminated. At the Province s fiscal year end, some funding may be identified by the child care area office to assist with these capital requirements. Garderie Sunflower Co-operative s requirement to be in a new location by March 31, 1997, requires immediate assistance from a funding partner. The department believes it is important to safeguard the existence of this bilingual, toddler and preschool program. The department therefore recommends a capital grant up to a ceiling of $85,000 for moving and start-up equipment costs incurred by Garderie Sunflower Co-operative. The final amount of the capital grant would be determined by actual costs and any provincial contribution.
8 FINANCIAL IMPLICATIONS RMOC capital grants are provided from the Child Care Capital Reserve Fund. Over the last few years no contribution has been made to this fund, which currently contains $28,224 in uncommitted funds. Sufficient funds can be transferred from the Child Care Contingency Fund, which contains $3.4 M in uncommitted funds, to provide for the capital grant requests from the New Edinburgh Child Care Centre and Garderie Sunflower Co-operative. PUBLIC CONSULTATION No specific public consultation was held on this issue. CONCLUSION The Region is in receipt of two capital grant requests that the department recommends proceeding with now. The New Edinburgh Child Care Centre is currently operating out of two temporary locations while their board attempts to finalize plans to build a new facility adjacent to Rockliffe Park Public School. The total estimated capital cost of the project is $1.053 M. New Edinburgh currently has a $755,000 provincial grant that they are seeking provincial permission to apply to this project. New Edinburgh has requested a Regional capital grant of $210,000. New Edinburgh s current arrangement in two physical locations is not efficient and there continues to be a demand for subsidized child care in this area. The department supports the allocation of a $210,00 capital grant to New Edinburgh conditional on provincial approval to proceed with the project. Garderie Sunflower Co-operative has received notice of termination of their lease effective March 31, 1997. Preliminary capital costs for moving and start up equipment are estimated at $85,000. To safeguard the existence of this program the department supports a regional capital grant of up to a ceiling of $85,000, the final amount to be determined by actual costs and any provincial contribution. FINANCE DEPARTMENT COMMENT To be provided under separate cover. Approved by Dick Stewart