Vancouver City Council

ADMINISTRATIVE REPORT

Date: December 17, 2002
Author/Local: D. Sherwood

604-873-7571

RTS No. 03104
CC File No. 8104

CS&B: January 16, 2003

TO:

Standing Committee on City Services and Budgets

FROM:

General Manager of Corporate Services in consultation with the General Manager of Community Services and the Director of Real Estate.

SUBJECT:

2003 Vancouver Economic Development Commission Services Contract and the Administration of the Downtown Eastside Tenant Improvements Assistance Program and the Lease Subsidy Program.

RECOMMENDATION

A. THAT Council amend the terms of its approval related to the administration of the Tenant-Improvements Assistance Program and the Lease Subsidy Program (the Programs), as (contained in Recommendations A, B and D of the Policy Report dated March 3, 2000) approved by Council on March 16, 2000, by authorizing the Partners for Economic and Community Help (PEACH) to be the manager and administrator of the Programs, in place of the Vancouver Economic Development Commission (VEDC), in accordance with and subject to the terms and conditions of the March 3, 2000 Policy Report and subject to PEACH entering into a contract with the City as provided for in Recommendation C.

B. THAT the General Manager of Corporate Services, in consultation with the Director of Legal Services, be authorized to enter into a revised one year services contract between the City of Vancouver and the VEDC for the 2003 fiscal year on terms and conditions satisfactory to the General Manager of Corporate Services and the Director of Legal Services, including that the VEDC be absolved of any future responsibility to manage and administer the Tenant-Improvements Assistance Programand the Lease Subsidy Program and that no future administration fees are payable to the VEDC for these Programs. No legal relations are hereby created and none shall arise hereunder until such time as a new services contract for the 2003 fiscal year is executed by the City and the VEDC and a contract has been entered into by the City and PEACH as referred to in Recommendation C.

C. THAT the General Manager of Corporate Sevices in consultation with the Director of Legal Services be authorized to negotiate a one year services contract for the 2003 fiscal year, between the City and PEACH to administer the Tenant-Improvement Assistance Program and the Lease Subsidy Program. The Services contract shall provide, subject to Council approval, for a maximum management and administration fee of $15,000 (including GST) being payable to PEACH for the 2003 fiscal year, with such sum to be negotiated . Terms of the contract to be similar to those that currently exist with the VEDC regarding the administration of these Programs and to include such other terms and conditions satisfactory to the Director of Legal Services, the General Manger of Community Services and the General Manager of Corporate Services, with the contract to be signed by the General Manager of Corporate Services. No legal relations are hereby created and none shall arise until such time as a services contract is executed by the City and PEACH.

AND THAT the funds for the management and administration fee to be allocated in advance of Council'a approval of the 2003 Capital Budget (source of funds to be the Downtown Eastside allocation in the 2003-2005 Capital Plan).

CITY MANAGER'S COMMENTS

The City Manager recommends approval of A, B and C.

On October 24, 2002 the previous Council approved VEDC's 2003 Business Plan, 2003 Budget and the renewal of the annual contract with VEDC for the 2003 fiscal year. VEDC has already begun working towards the 2003 business goals.

Approval of these recommendations will continue Council support for sustainable economic, social and community development in the Downtown Eastside.

POLICY

On March 16, 2000, Council approved the Downtown Eastside Lease Subsidy Program and the Tenant-Improvements Assistance Program. Pursuant to the terms of a services contract between the City and the Vancouver Economic Development Commission (VEDC) dated January 1, 2002, these Programs have been managed by the VEDC in consultation with Real Estate Services, the Planning Department and representatives from the community.

On March 16, 2000, Council allocated $150,000 from the 2000-2002 Capital Plan for the Tenant-Improvements Assistance Program.

On March 16, 2000, Council allocated $150,000 from the 2000-2002 Capital Plan for the Lease Subsidy Program.

PURPOSE AND SUMMARY

This report seeks Council's approval to direct the General Manager of Corporate Services, in consultation with the Director of Legal Services, to enter into a revised services contract with the Vancouver Economic Development Commission (VEDC). This contract will exclude any requirement to manage the two previously approved programs (Lease Subsidy Program and the Tenant-Improvements Assistance Program) designed to encourage the economic revitalization in the Downtown Eastside.

This report also seeks Council's approval for the General Manager of Corporate Services to concurrently negotiate, in consultation with the Director of Legal Services, and execute a new services contract between the City and PEACH. The services contract between the City and PEACH will authorize PEACH to assume the management and administration of the two approved programs (Lease Subsidy Program and the Tenant-Improvements Assistance Program) for a maximum management and administration fee of $15,000 and to carry out and be responsible for all the obligations in respect thereof presently performed by the VEDC.

BACKGROUND

In November 1998 Council approved "A Program of Strategic Actions for the Downtown Eastside." One objective of the program is to bring legitimate businesses back to the storefronts of Hastings Street between Gore and Cambie.

On March 16, 2000, Council approved the Lease Subsidy and Tenant-Improvements Assistance Pilot Programs to encourage locally-based businesses to commence operations in the Downtown Eastside. $150,000 was allocated from the 2000 - 2002 Capital Plan for each of these Programs. Council also approved that the VEDC, in consultation with staff and a community-based Business Assistance Review Committee, would administer these Programs in accordance with the directions and requirements of the City related to the Programs. The contract with VEDC for the 2000 fiscal year was amended to include an additional $15,000 (including GST) as a fee for managing these Programs.

On May 16, 2000 Council approved the first Lease Subsidy grant to Clothes Encounters- a proposed laundry/café.

In 2000 the VEDC and the Four Corners Support Fund Society (FCSFS) formed PEACH (Partners for Economic and Community Help). The purpose of PEACH is to offer in a single storefront location a comprehensive set of programs to help revitalize business in the Downtown Eastside.

On May 17, 2001 Council approved the second Lease Subsidy grant to Call 'N Post - a social enterprise offering voicemail, mailboxes, printing and fax services. Council also authorized the VEDC to have PEACH administer the Pilot Programs until such time as PEACH becomes a registered nonprofit society capable of contracting directly for services with the City. The report also stated that City Staff would report back to Council once the VEDC is in a position to devolve the management and administration of the Pilot Programs to PEACH and will seek Council's approval or direction as such time.

The approved grant monies from the City continued to flow through the VEDC as they continued to have responsibility for the administration of the Programs. The grant money would then be distributed to PEACH who in turn would distribute to the approved organization subject to that organization continuing to meet the requirements defined in the Program agreement.

The responsibility for the administration of the Programs and the distribution of grant monies approved by City Council continued to be a part of the VEDC's 2002 services contract with the City. The contract stated that the VEDC may permit, for so long as Council allows in its sole discretion, PEACH to manage, administer and coordinate the Programs on behalf of the VEDC during the term of the VEDC's services contract or until PEACH is incorporated as a Society.

On June 28, 2002 PEACH was incorporated as a society under the Society Act of British Columbia. Two representatives from the VEDC, two from the Four Corners Support FundSociety and four members from the community are the first directors of PEACH. Appendix A provides a list of the PEACH's first directors and a short statement of PEACH's objectives.

On October 24, 2002 Council approved VEDC's 2003 Business Plan, 2003 Budget and the renewal of the annual contract with VEDC for the 2003 fiscal year. The VEDC immediately began working towards the delivery of the four primary goals established for the fiscal year 2003. These goals do not include the delivery of programs to the Downtown Eastside but there is a statement that the VEDC will support the transition of PEACH into a fully functioning separate legal entity.

DISCUSSION

Revision of Contract for Services with the VEDC

The VEDC is currently undergoing a transition where it will withdraw from the management of specific economic revitalization programs for the Downtown Eastside. This is reflected in the VEDC's 2003 budget and business plan approved by Council on October 24, 2002. Consistent with this direction, the intention, subject to Council approval, is for the VEDC to be released from their obligation to manage the Lease Subsidy and Tenant-Improvement Assistance Programs and for PEACH, subject to Council approval, to assume the responsibilities and obligations to manage and administer the Programs pursuant to a new services contract to be entered into between the City and PEACH.

PEACH has been managing the Programs on behalf of the VEDC since May 2001. Since PEACH became a legal entity in June 2002 no contract has been established between the City and PEACH regarding the management of these Programs. The formal transfer of Program responsibility will remove any unnecessary level of administration and further the consolidation of Downtown Eastside programs into a single delivery organization.

New Contract for Services with PEACH

This report requests Council authority for the City to enter into an agreement with PEACH pursuant to which PEACH will assume direct responsibility for the administration of the Lease Subsidy and Tenant-Improvement Assistance Programs. It is intended that the General Manager of Community Services will assign staff to continue to serve as a policy liaison to PEACH staff and as a member of its community advisory committee. She will also report to Council, in consultation with the Director of Real Estate and the General Manager of Corporate Services on PEACH's recommendations to Council concerning Lease Subsidies and Tenant Improvements with Council retaining the final authority on which organizations shall receive grants from the City or participate in the Programs. The General Manager ofCorporate Services will monitor the performance of PEACH to ensure that grant monies approved by Council are distributed and used for the purposes intended.

It is the intent of the General Manager of Community Services to report to Council in early 2003 on the general activities of PEACH and the projects and new businesses it has help develop.

CONCLUSION

The VEDC has been administering the Lease Subsidy and Tenant-Improvement Assistance Programs through PEACH, and the objective of these Programs is consistent with PEACH's mandate. Following PEACH's incorporation and coinciding with VEDC's annual service contract renewal it is now appropriate for the Programs to be removed from VEDC's service contract and included in a new services contract with PEACH.

This will help VEDC to focus on their mandate of economic development throughout the entire City rather than spending particular focus and attention on one area of the City. Funding will no longer be required to be transferred through VEDC thus reducing administrative workload. There is also a need to formalize the City's relationship with PEACH which can now be achieved through a new services contract with PEACH.

* * * * *

APPENDIX A

Partners for Economic and Community Help
List of First Directors as of June 26, 2002

Larry Blain	Ken Lyotier	David Pohl
Peter Fairchild	Marcia Nozick	Linda Thorstad
Sister Catherine Fujisawa	Luc Paradis

PEACH - Statement of Objectives

The purpose of Partners for Economic and Community Help (PEACH) is to offer a comprehensive mix of government programs in a single storefront location in the Downtown Eastside. PEACH is an initiative in which the three levels of government are providing complementary resources under the auspices of the Vancouver Agreement. All initiatives will be used to better the social-economic situation of the Downtown Eastside by furthering community capacity building, by enhancing entrepreneurship and business development, and by creating employment and employment training opportunities. The primary focus of all of these activities is the residents of the Downtown Eastside.

PEACH provides community development funds and services specifically tailored to the needs of the Downtown Eastside community and offers capital funds and services that may not otherwise be available to enterprises in that community.

PEACH is delivering four programs on behalf of the Vancouver Economic Development Commission and the Four Corners Support Fund Society:

· Community Development Fund
· Business Development Fund
· Lease-Subsidy, and
· Tenant Improvement Programs

PEACH will also provide
· Business development services
· Business counselling
· Assistance with business planning
· Help with development permits
· Various other supports to enterprise development


TO:	Standing Committee on City Services and Budgets
FROM:	General Manager of Corporate Services in consultation with the General Manager of Community Services and the Director of Real Estate.
SUBJECT:	2003 Vancouver Economic Development Commission Services Contract and the Administration of the Downtown Eastside Tenant Improvements Assistance Program and the Lease Subsidy Program.