ADMINISTRATIVE REPORT


                                                  Date:  September 27, 1996


   TO:            Vancouver City Council

   FROM:          Director of Finance

   SUBJECT:       Renewal of Fiscal Agency Agreement



   RECOMMENDATION

   A.   THAT Council authorize the Director of Finance to conclude a
        renewal of the Fiscal Agency Agreement on behalf of the City with
        RBC Dominion Securities Inc., in essentially the same form as the
        expiring agreement.  The term will be for three years commencing on
        January 1, 1997 and expiring on December 31, 1999, subject to
        cancellation by either party on 60 days notice.

   B.   THAT, prior to the issuance of any debentures under the renewed
        agreement, the Director of Finance be instructed to report the
        terms and conditions of a prospective issue to City Council or, if
        Council is unable to meet, to the Mayor, the Chair of the City
        Services and Budgets Committee and the City Manager for approval. 


   GENERAL MANAGER'S COMMENTS

        The General Manager of Corporate Services RECOMMENDS approval of A
        and B.


   COUNCIL POLICY

   There is no Council policy directly applicable to this matter.


   BACKGROUND

   RBC Dominion Securities Inc. and its predecessor companies have been the
   City's fiscal agent for a number of years, and have a history of serving
   the City extremely well.  A fiscal agent provides expert advice on the
   timing and size of debenture issues, orderly marketing procedures to
   avoid conflicts with other competing borrowings, and favourable exposure
   of the name of the borrower in the capital markets.

                                      -2-



   Over the years, RBC Dominion Securities has assisted the City with the
   placement of a considerable number of successful debenture issues,
   including the preparation of related financing documents and various
   presentations to the rating agencies.  The City is currently rated as a
   triple 'A' credit by Standard and Poor's, Moody's and Dominion Bond
   Rating Service.  


   DISCUSSION

   It is impossible for the City of Vancouver as a borrower to be sensitive
   and up to date on market conditions at all times.  We therefore rely on
   our fiscal agent to supply this advice and guidance on an ongoing basis,
   but this service is much more critical when the City is about to launch
   a debenture issue, because significant savings in interest and issue
   costs are possible if a borrower can position itself to take advantage
   of favourable market conditions. 

   The fiscal agency agreement sets out the mutual understandings and
   general terms and conditions between the City and RBC Dominion
   Securities Inc.  The document itself is not a formal contract and
   basically outlines how our capital financing requirements will be
   handled.  The agreement is cancellable on 60 days notice by either
   party, and the terms and conditions applicable to each debenture issue
   are subject to mutual agreement at the time of the issue.  The formal
   items of the agreement refer to expenses and commissions, both of which
   are relatively standard across the industry and are negotiable during
   the term of the agreement.  In summary, the agreement documents a
   process for the marketing and sale of City debentures. 


   CONCLUSION

   The City's debentures are best sold to investors through and by a fiscal
   agent having expert knowledge of the domestic and foreign capital
   markets.  RBC Dominion Securities Inc. has established an excellent
   track record with the City in that regard and a renewal of their current
   fiscal agency agreement is recommended on that basis.