Government Operations Committee on March 20th, 2007

[Garth Turner, Conservative, Halton, ON]

Can we find that out?

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

Yes, we can get that.

[Garth Turner, Conservative, Halton, ON]

Okay.

Is there is a commission structure on the sale? In other words, if the buildings sell, there's a certain amount payable.

I'm also interested in the leaseback, because often there's a commission paid on the total amount of the leaseback amount. I'm interested in knowing if it's a double end. If the banks are getting paid for that, I'd like to know that information.

I would also like to know what liability will survive closing. Is there a liability? Are we in any way, shape, or form guaranteeing the buildings in any physical state? Are we guaranteeing them against unforeseen liabilities? Does the government have a liability that survives closing? I'd like to know that, if we don't know it.

[Mary Chaput]

I would venture to say that would be determined by the lease terms and conditions.

[Garth Turner, Conservative, Halton, ON]

Can we find out who has the answers to those questions and get them here?

[Mary Chaput]

We'll try—

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

We have the wrong department for some of the questions. Each of the nine RFPs is going to be different. Some of those questions will be different because the buildings are very different, the tenants are different, the structure is different.

But the Minister of Public Works will be back here again. If you want to get a briefing at the Department of Public Works, we're happy to set that up for you.

[Garth Turner, Conservative, Halton, ON]

I'd just like to know the mechanics of the deals, because if they're prototype deals, it's so important that we understand how they're structured, how they're compensated, and whether in fact it's a reasonable disposition of public assets.

Thank you.

[The Chair, Liberal, Diane Marleau]

Very good.

We'll end with Monsieur Nadeau, and then if we have time, we have some motions, I believe.

Monsieur Nadeau.

[Richard Nadeau, Bloc, Gatineau, QC]

Thank you, Madam Chair.

Good afternoon, Ms. Brady, Ms. Chaput and Ms. Jen.

If I understand correctly, your offices are located here, in the region, on the Ontario side of the river. Have you heard about the policy whereby 25% of the jobs are supposed to be on the Quebec side of the river and 75% on the Ontario side of the river? It was established in 1983. Have you received any directives about this in the context of your work?

[Mary Chaput]

There's not a strict Treasury Board policy around where a department will locate or not locate, but you're quite correct in that there is a government position that seeks to establish a dispersion of government accommodation in the national capital region: 75%-25%. Currently that dispersion is running at about 74%-26%.

[Richard Nadeau, Bloc, Gatineau, QC]

I am not talking about buildings, but rather about employees. However, there is no doubt that this does have an impact. I will give you a report that I did at one point and that I have given to other witnesses as well. It shows that the percentage was 18.9% on the Quebec side, compare to 81.1% on this side of the river. That said, you say that you have some indications that there is a will to achieve these percentage targets.

In the City of Gatineau, I am told that in about the last year, people have been calling to find out what the city's policy was about welcoming these people. We are talking about approximately 7,000 new jobs. This information comes from the mayor's office. In addition, real estate agents are interested. They want to know whether employees will be moved, because this would involve buildings in Quebec where these employees might be working. It is expected that the approximately 7,000 employees will be transferred, but it is not yet known when this will happen. Minister Fortier seemed to acknowledge that there had been a delay in restoring the balance.

When a lease expires in Ottawa, do you consider a transfer, and do you look for places that, all things being equal, are less or much less expensive on the Quebec side? In the document I will be giving you, you will see dates for each year. This is public information with which you are quite familiar. Are you quite frugal when it comes to the cost of renting buildings? Are you beginning to transfer employees so that those currently working in Ottawa could work in the Outaouais, at least in the city of Gatineau?

[Mary Chaput]

When the minister is proposing to enter into a new lease, a value-for-money assessment is always done. If the lease, for example, is on the Quebec side, and let's say it is a class A building, the amount negotiated would be compared to the class A rent both on the Quebec side and on the Ontario side to decide whether that was the best value for money. But I might mention that certain departments, for security reasons or whatever, need to be close to the Hill, etc., without a bridge in between them, so typically they're on the Ottawa side.

On balance, because I think you're talking about--

[Richard Nadeau, Bloc, Gatineau, QC]

We all agree that the City of Gatineau is within walking distance from Parliament Hill. We are not talking about a huge number of kilometres. In addition, the new policy talks about a distance of 10 kilometres from the Parliament buildings. That means 10 kilometres north or south. In the past, the distance was four kilometres. This is not a question of security. We do agree that not all departments would be involved. For example, we would not consider the RCMP. I was thinking rather of other departments as regards this target.

You gave me the example of a location in Gatineau where a lease was expired and the property was on the same side of the river. I want to hear more about leases that are expiring on the Ottawa side of the river, where costs are much higher. If I understood your answer correctly, no effort has been made with respect to transfers, in an effort to sign less expensive leases on the Gatineau side of the river.

In addition, when we are talking about moving a large number of people, and when no building is available but a contractor is prepared to build one to meet the needs, do you take into account that it will be less costly in the long term to be located on the Quebec side of the river?

[Mary Chaput]

Yes, sir. We would always look at the long-term costs, whether for leasing over a long period of time or for acquisition and maintenance, and we would compare the proposal that the minister brings forward against a range of alternatives.

The objective is always best value for money. Features come into play, though, that might determine an outcome that was not necessarily the most inexpensive; the value could be the size of the property that's required or the timing in terms of the availability of the property. So there may be a case in which it would be cheaper to lease on one side of the river or the other, but there isn't a building of the right size available at the right time.

[The Chair, Liberal, Diane Marleau]

Thank you, Mr. Nadeau.

I would like to thank our witnesses for appearing before us today. I hope that we have learned something.

We will continue now with motions.

By the way, I want the committee members to know that I've just found out that the Minister of Public Works will not be appearing before our committee at the end of March. Do we have any idea when he will be coming? Is it April 24?

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

This is specifically for main estimates. I understand that as long as it's....

On April 24, he—

[The Chair, Liberal, Diane Marleau]

We'd like to have him earlier, because there are a lot of things going on, especially on the sale of these buildings. We can also pass a motion to summon him if he doesn't come.

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

He's available to come on the 24th. I understand there is now a problem with the 29th, when he was originally going to be here. He is available for the 24th.

[The Chair, Liberal, Diane Marleau]

Maybe he can come on the 27th.

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

This is specifically on the main estimates. As long as he's here, as I understand it, before the end of May—

[The Chair, Liberal, Diane Marleau]

Well, no, we'd like to speak to him again on this real estate. How about March 27?

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

As I understand it, there's a conflict.

[The Chair, Liberal, Diane Marleau]

Madam Nash, you have two motions. Would you like to move one?

[Peggy Nash, NDP, Parkdale—High Park, ON]

Thank you, Madam Chair. Shall I read the motion again?