CITY OF VANCOUVER

ADMINISTRATIVE REPORT

 

Date:

April 1, 2004

 

Author:

Carol Ann Young

 

Phone No.:

871-6042

 

RTS No.:

3960

 

CC File No.:

5104

 

Meeting Date:

April 20, 2004

TO:

Vancouver City Council

FROM:

Director of Social Planning, in consultation with the Director of Legal Services and Real Estate Services

SUBJECT:

Land Leases for BCBC Portables

RECOMMENDATION

GENERAL MANAGER'S COMMENTS

The General Manager of Corporate and Community Services recommends approval of A, B and C.

COUNCIL POLICY

In March, 2003, Council, Park and School Boards adopted the Childcare Protocol to maintain and expand childcare by 5% over the next two years.

In April, 2002, Council approved the child development strategic plan "Moving Forward - Child Care a Cornerstone to Child Development" as the basis for future design of childcare/child development services.

In June, 1993, Council directed that City-owned properties, occupied by non-profit organizations, be held as assets in the Capital Fund and be charged a nominal rental rate. The lease/sublease/license of City assets below market value constitutes a grant and, as such, requires eight affirmative votes.

SUMMARY

In the mid 1970's, the City entered into a lease arrangement with the Provincial government for the use of City-owned land, for a nominal rent, on which to build 10 childcare portables. For the past 30 years, the childcare programs have operated in Provincial buildings on City-owned land. The Provincial government covered occupancy costs and annual maintenance and repairs.

The Provincial government has informed the childcare societies operating these programs by Fall, 2004, when portable replacement is completed, that they will transfer ownership of the portables to the societies and no longer cover occupancy costs (approximately $15,000 per annum). Those societies not taking a portable replacement option but choosing to construct a permanent facility, will also be required to take ownership of their existing portable at this time. The transfer of ownership is contingent on the non-profit society entering into a land lease with the City/Park Board.

The childcare societies are currently in negotiations with the Province on the terms and conditions of the transfer. Of the 10 childcare portables, two have been demolished and replaced with permanent facilities on City land, three are on Park land; four are on City land and one is on a BC Hydro land.

Staff is recommending that Council enter into a land lease between the City and the four childcare societies for a period of five years, with the option for renewal for two further five-year periods, at a nominal rent and on terms and conditions consistent with the City's policies and practices for childcare leases and other such terms satisfactory to the Directors of Legal Services, Real Estate and Social Planning. There is a history of the City providing such arrangements with non-profit societies.

Gingerbread Day Care on Hydro land has been informed by the Province that they will extend their lease until September, 2004. City staff have had an initial discussion with BC Hydro regarding the feasibility of a land lease between the City and Hydro for the short-term, while a permanent site can be located for Gingerbread. Staff would explore terms and conditions of a short-term lease with Hydro, if necessary, to maintain the childcare at its current location until a new site is found. City, School and Park staff are exploring possible sites to relocate Gingerbread in the long term. This report seeks Council's approval to explore a preliminary design and cost estimates on replacing the existing City-owned portable - Playhouse Child Care Centre, and the BCBC-owned portable - Brant Villa Child Care centre, located on adjacent City lots, with a new child development facility for 69 licensed childcare spaces. Playhouse Child Care Centre, in a City-owned building, has approved lease terms with the City.

PURPOSE

This report seeks Council's approval to enter into a land lease with four childcare societies currently in BCBC childcare portables on City land, including Boat Day Care Society, 2908 Victoria Drive; Brant Villa Day Care Society, 4103 Brant Street; Kitsilano Montessori Day Care Society, 2091 West 8th Avenue and Sunset Child Care Society, 8064 Buscombe Drive, for the purpose of licensed childcare. This will maintain 100 licensed childcare spaces. The non-profit societies need to be assured that they have the support of Council in the form of a lease agreement so they can successfully conclude their negotiations with the Province.

Further, it seeks Council's approval to explore terms and conditions of a land lease between BC Hydro and the City, until a permanent site can be established, if necessary. Finally, this report seeks Council's approval to explore a preliminary design and cost estimates on replacing the existing City-owned portable-Playhouse Child Care Centre, and the BCBC portable-Brant Villa Child Care centre, located on adjacent City lots, with a new child development facility for 69 licensed childcare spaces.

BACKGROUND

The City provides nominal land lease as grants for non-profit societies on City land.

In April, 1974, Council approved 10 proposed sites for daycare centres (two portables have since been demolished and replaced with permanent facilities, leaving 8 remaining), including water, sewer and electrical connections and a two-year ground lease at $1 per year for each site. This included the sites currently housing the eight BCBC childcare portables on City, Park or Hydro lands. The lease agreement for programs on City land was between the City of Vancouver and the Province of British Columbia.

The terms under which day care centre sites were to be leased to the Provincial government included that the lessee pay the cost of $1.00 per year, provide public liability insurance, be responsible for preparation for the site and all utilities, comply with City by-law requirements and, upon expiry, remove structures including foundations and leave the sites in a neat and tidy condition. Tenancy on expiration of the term granted would be month to month and would be terminated by one month's notice in writing.

The Provincial government has indicated its intention to terminate the lease agreements with the City/Park and Hydro and to turn over the ownership of the eight remaining childcare portables to the childcare societies along with annual occupancy and maintenance costs of approximately $15,000. In addition, the Province has offered to either replace existing portables with new modular buildings, or provide a capital grant of up to the equivalent cost of construction for the portables for construction of a permanent building or renovation, providing construction commences by April 1, 2005. If any of these options is not exercised, the Province will demolish existing buildings at no cost to the operator.

Of the four programs on City land, two have expressed interest in portable replacement (Boat Day Care and Sunset Day Care), one is exploring the feasibility of a new facility in collaboration with a multi-service organization (e.g. Brant Villa Day Care) and the fourth is exploring a capital renovation (e.g. Montessori Day Care Centre).

The three programs on Park land - Nanook Childcare Centre run by YMCA is exploring the replacement of the portable with a permanent facility on the existing China Creek Park; Kitsilano Area Childcare is planning a portable replacement; and Harbourview Childcare Centre, which appears to be a BCBC portable according to past development permits, would like a portable replacement. The Province, however, is disputing ownership of this portable and has indicted that because it has not been paying occupancy costs for this program, it is ineligible for portable replacement. This issue has not yet been resolved between the operator and the Province and has created significant concerns for the operator.

The last portable, Gingerbread Child Care Centre on Hydro land, would like to replace their portable, if a new site can be found and construction completed by March 31, 2005.

DISCUSSION

In order for the childcare societies to continue service delivery and further their discussions with the Provincial government, land leases must be secured. Given the long-standing relationship between the City and the childcare societies and the critical need to maintain existing childcare spaces, staff are recommending that the City enter into a lease arrangement with the childcare societies, on the terms and conditions consistent with the City's policies and practices for childcare leases and other terms as required by, and satisfactory to the Director of Legal Services, in consultation with the Directors of Social Planning and Real Estate Services.

All four City programs provide licensed childcare for 25 children, ages 3 to 5 years. Three of the four programs are located in areas of the City where there are a significant number of children and limited childcare spaces. They are operated by parent-run non-profit societies and have been in operation for over 30 years in their respective communities.

The three childcare programs located on Park Board land - Nanook Day Care Centre, Kitsilano Child Care Centre and Habourview Child Care Centre - are seeking leases with conditions similar to those on City land. Park Board staff will be taking forward a report in May, 2004, for these three leases.

The eighth program - Gingerbread Day Care - is located on BC Hydro land. The Provincial government has indicated that it will terminate it's lease with BC Hydro as of September, 2004, and, at this point, does not have a contract for a portable replacement. City, Park and School Board staff are looking at possible alternatives for relocating this program in the long-term and are awaiting assurances from the Province that a new portable will be built, once land can be secured. In the interim, staff are seeking Council approval to explore a short-term lease, should it be necessary, with BC Hydro until a new site can be secured. Staff would report back with specific terms and conditions. It is preferable for the City to enter into a lease arrangement with BC Hydro and cover lease costs directly. The City will also explore lease arrangements with the Province. The City would then sub-lease to the childcare, at a nominal rent, as a grant in-lieu of rent.

FINANCIAL IMPLICATIONS

There are potential costs for the lease with BC Hydro which need to be determined. The preliminary design costs of building a new 69-space program to replace Brant Villa and Playhouse Child Care (City-owned) Centres would be up to $25,000, to be cost-shared between the City ($15,000), and the two programs ($5,000 each). Report back to Council on cost considerations and source of funding would be forthcoming in the Fall. The eight non-profit societies will be required to find the additional $15,000 annual occupancy costs and annual maintenance and repair costs, which may put pressure on City grants.

CONCLUSION

Staff support the lease of City land at 2908 Victoria Drive, 4103 Brant Street, 2091 West 8th Avenue, and 8064 Buscombe Drive, for the purpose of licensed childcare for a five-year term, renewable for two further five-year terms and the exploration of lease terms with BC Hydro for Gingerbread Day Care.

Staff also support a short term lease with BC Hydro, should it be necessary, and the exploration of a preliminary design and costing for a permanent 69 licensed space child development hub on the City lots currently housing the one City owned portable and one BCBC portable.

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