LEGISLATIVE ASSEMBLY OF ONTARIO

STANDING COMMITTEE ON Estimates

Tuesday 14 November 2006

Ms. Lisa MacLeod (Nepean–Carleton): I appreciate the opportunity to participate in today’s committee. I have several questions for the minister with regard to the Ottawa light rail project. I’d just like to follow up on some of the questions I had in question period today. I wasn’t satisfied with the answers because, quite frankly, I wasn’t convinced you understood the file. So I’m going to ask again.The former mayor of Ottawa has said—and I’ve got the letter right here, and it essentially says, “Any contemplation of the proposed east-west LRT project, or other potential alternative investments, would be inconsistent with the terms and conditions of our MOU.”Essentially former Mayor Chiarelli suggests that this is in terms of the project which many of the candidates in the municipal election didn’t support. If it wasn’t supported by the next mayor, the province of Ontario will be removing $200 million because they didn’t support the plan as is, and I’d like you to clarify. Was the previous mayor correct in saying that if the LRT project in Ottawa is at all modified, you will not be forthcoming with $200 million?

Hon. Mr. Caplan: Well, Mr. Chair, certainly I don’t appreciate the comments earlier. I certainly know this file quite well and I would suggest that the member opposite really has never been a supporter of it—

Ms. MacLeod: Mr. Chair, that’s categorically false. If he wants to editorialize things that he doesn’t know about—

The Vice-Chair: Okay, answer the question. We’re in questions and answers. Okay? Go ahead.

Hon. Mr. Caplan: Well, Mr. Chair, the member made several statements which I think—

The Vice-Chair: You answer the question then.

Hon. Mr. Caplan: I think I should be entitled to be able to address.

The Vice-Chair: All right. You answer the question.

Hon. Mr. Caplan: If the member wants to editorialize in her question, I think I should be entitled to a rebuttal.On April 21, 2005, I was quite honoured to sign a memorandum of understanding with the city of Ottawa and with our federal government in good faith to support what the city of Ottawa had identified as a top investment priority, the north-south line of the Ottawa train. I was quite proud of it then and I stand behind the memorandum of understanding and the agreement that we have, which in fact was recently ratified back in either the late spring by the city council of Ottawa.I can tell you that the problem has really been—and I hope the member will take this seriously because it has been the interference by the federal president of the treasury board in the municipal election which has thrown this project into complete disarray. I know that the federal minister has, for reasons that are unknown to anybody, decided to meddle and apparently—and I hope not and I hope the member would join with us to get our federal colleagues to live up to the agreement that they signed in good faith with the city of Ottawa and the province of Ontario to support that much needed transit expansion.1710Of course, I do want to say at the outset that I congratulate Mr. O’Brien, the mayor-elect of Ottawa, on his election victory last night and I look forward to an opportunity to chat with him and with council on any future direction. But I want to be very clear: The Ontario government has signed an agreement with our partners, and we stand behind that agreement.

Ms. MacLeod: Fundamentally, there is a misunderstanding of what the situation in Ottawa actually is, and I’m going to take a few seconds to explain it, because this is major infrastructure funding not only for my community but for my entire city. Essentially, this $200 million, ??at all three levels of government, was committed on May 14, 2004—$600 million was committed before there was an environmental assessment done and details for the current light rail project were actually set in stone, which is fine, because it’s a great investment in my community.I’ve got a letter here from mayor-elect Larry O’Brien, who wrote to John Baird asking him to do some due diligence on the O-Train file. “In a letter sent to Treasury Board President John Baird, O’Brien asked if a due diligence review is in progress and whether the $200 million grant was conditional upon the federal government being satisfied that the overall expense to Canadian taxpayers is justified.”That did occur.A couple of days later, I put down a few order paper questions asking if the province did due diligence as well, because the appetite for accountability and transparency in Ottawa is very high. John Baird did that. He made a commitment to the people of Ottawa. He said the next council can make a decision on whether or not that they want to move forward on light rail in Ottawa. Overwhelmingly, last night there was a decision made by ??the people of Ottawa that the current project might change.In any event, I’ll wrap this up. To be very quick, we got a letter on Friday in the city of Ottawa—now John Baird has committed. There’s $200 million coming from the federal government, waiting to be spent by the city of Ottawa. We have a problem here with the province of Ontario not committing to keeping that pool there for the new council who may or may not decide to go with the current plan. That’s where we fundamentally have an issue, and that’s why I would like to listen to what the minister has to say. Maybe he can shed some light on why he’s obfuscating right now.

Hon. Mr. Caplan: I don’t think “obfuscating” is in order, Mr. Chair; I think the member has to withdraw that.

The Vice-Chair: I’m not sure what you—

Hon. Mr. Caplan: She just accused me of lying.

Ms. MacLeod: No, I didn’t. I just—

Hon. Mr. Caplan: Don’t be smug. You’re not that clever.

The Vice-Chair: Rephrase it, and answer the question.

Hon. Mr. Caplan: I want her to withdraw it.

Ms. MacLeod: I withdraw it. I didn’t mean to hurt your feelings.The Vice-Chair: Now answer the question. She wants to know if you’re going to put the $200 million in or not.

Hon. Mr. Caplan: I think I should be allowed to answer the question.

The Vice-Chair: Well, then, answer it.

Hon. Mr. Caplan: Well, thank you very much.First of all, I think it’s a little unseemly to see the member front for Mr. Baird. I’m not sure that the chronology that the member offers is either accurate or—

Ms. MacLeod: So can he withdraw the—come on, Mr. Chair.Essentially, all I’m asking—

Hon. Mr. Caplan: Am I going to be allowed to answer, Mr. Chair?

The Vice-Chair: Go ahead and answer the question. Please let him answer.

Hon. Mr. Caplan: I hope you’ll keep order, Mr. Chair.In fact I have a copy of the memorandum of understanding right here. In fact, it’s public. You will find it on ??www.ottawa-public-lrt.ca. It is a public document for anybody who wishes to view it, but I have a copy of it here for me today. Section 4 states:“(a) The city acknowledges that Canada’s and Ontario’s funding for the project remains conditional on meeting, to the complete satisfaction of Canada and Ontario, applicable federal and provincial government requirements including, but not limited to:(i) successful completion of all necessary federal and provincial environmental assessments which includes implementation of any applicable mitigation measures in the engineering design;(ii) the city completing a detailed ridership study that supports the implementation of the project;(iii) the city completing a business case that analyzes the technical and financial viability of the project, including those detailed in the Canada Strategic Infrastructure Fund transit information requirement template (the ‘CSIF template’);(iv) where possible, the exploration of the employment of an innovative delivery strategy to offset cost and transfer risk;(v) project compliance with all applicable laws and regulations, and receipt of all required approvals; and(vi) the negotiation of a formal agreement(s) containing Canada and Ontario’s terms and conditions regarding the making of contributions including, without limitation, agreed terms and conditions regarding the city’s obligation to Canada and Ontario in consideration for Canada’s and Ontario’s financial contributions toward the project....“(b) The city further acknowledges that Canada’s and Ontario’s funding for the project is conditional on approval of funding and approval of, and authorization to enter into ..., ” subject to Management Board and Treasury Board.Now the question: Did the city meet the due diligence required in section 4? The answer is yes. Environmental assessments: The provincial EA was approved by the Ontario Ministry of the Environment on June 7, 2006, followed by federal EA approval on June 16, 2006. I would have thought the member would be aware of this.The detailed ridership study was completed in February 2005. I would have thought that this member and Mr. Baird would have been familiar with it.

The Vice-Chair: Maybe you’re not aware of that. Maybe they do know that, and you’re just not aware of that. You’re implying that they don’t know what’s going on.

Hon. Mr. Caplan: Mr. Chair, I don’t—

The Vice-Chair: That’s what you’re implying, and if anybody’s going to withdraw anything, you’re going to withdraw that.

Hon. Mr. Caplan: I don’t think we’re allowed to debate here, sir.The business case, in accordance with the Canada Strategic Infrastructure Fund template, was completed in August 2005. The innovative delivery strategy, a study on the north-south land uplift value and capture, was also completed in June 2005. The provincial Treasury Board and cabinet approved Ontario’s commitment to enter into a formal agreement with the city of Ottawa and the federal government to fund the LRT project on June 15, 2006.The question was: Was due diligence done? In fact, according to the memorandum of understanding signed in good faith by the federal, provincial and city governments, the city lived up to it, and due diligence was done. It’s regrettable that, for some unknown reason, this member and the new federal Treasury Board president seem intent upon derailing this particular project.

Ms. MacLeod: Thanks, Mr. Speaker. That was great. It didn’t answer my question. Let me rephrase it. Almost half of the new council has publicly stated since last evening that they will probably vote against the current proposal when it goes back. My question for you: If that changes even one iota, is that $200 million still going to be made available to the city of Ottawa for rapid transit? Yes or no? It’s not that hard.

Hon. Mr. Caplan: I think I’m very clear.

Ms. MacLeod: You haven’t been clear.

Hon. Mr. Caplan: We’ve entered into an agreement. It’s been ratified by the city council of Ottawa. I’ve heard a lot of “probablys” and “maybes” and “if” it would be. I do know that the city of Ottawa council has ratified, and it’s contained in their minutes, the particular agreement that we have. We stand behind that agreement. It’s for $200 million to fund the north-south rail line. As I said, I have not had a chance to call and congratulate the new mayor-elect, Mr. O’Brien, on his election victory last night. I look forward to having that conversation with him. But we have an agreement, and I want to assure this member that at least the province of Ontario, unlike, seemingly, our federal government, stands behind the agreement that it’s signed.

Ms. MacLeod: Well, that’s great. Right now, on CRFA radio in Ottawa, city councillor Jan Harder, whom my colleague across the floor would be quite familiar with, has indicated that Siemens and the consortium are willing to give mayor-elect O’Brien some time to look at alternatives on the light rail project, so that is hitting the media right now. At the same time, of course, the federal Treasury Board president has just indicated that he has never threatened to pull the funding, like the Ontario government did, and says he is willing to fight for more infrastructure funding for the riding of Nepean–Carleton and the city of Ottawa.Again, I ask, with this new information, with the fact that we’ve been told today that there’s a possibility of half of the council being not willing to support the current light rail project, with the fact that Councillor Harder has now made a public statement that the city of Ottawa and the consortium are considering alternatives, will the $200 million committed to the city of Ottawa by the province of Ontario on May 14, 2004, still be on the table if that rail line moves one iota?

Hon. Mr. Caplan: I don’t think I could be any more clear. It’s, as I say, unseemly to see this member shill for President Baird. However, I can tell you that the province—

Mrs. Mitchell: It’s sad.

Hon. Mr. Caplan: It’s sad, my colleague says, but I think unseemly. I can tell you that the province has entered into an agreement in goodwill with our counterparts federally and locally. It’s been ratified by the province of Ontario. It’s been minuted at Treasury Board. Our colleagues at city council have ratified it; the ratification of the deal appears, I believe, in their minutes. I don’t think I could be any more clear with this member. Notwithstanding the comments of the federal Treasury Board president, I think that actions speak louder than words. The McGuinty government has never wavered one iota in its commitment to Ottawa and to this project. I don’t believe this member, nor the federal Treasury Board president, can say the same.

Ms. MacLeod: Obviously, we have a difference of opinion on this letter that was dated November 10 that was sent by your deputy minister to the city of Ottawa. From my understanding of what the federal government’s done and what the city has done—essentially what I’m understanding is that if the light rail project doesn’t go through as is, yes, indeed, it will be vetoed. That’s a real shame, because that $200 million is required in my community.In any event, I have a series of questions that I’d like to ask the minister. I’m just wondering if he could provide the total amount of money that the government has committed to the city of Ottawa? Is it indeed $200 million, or have additional funds been allocated or set aside for this project?

Hon. Mr. Caplan: It’s $200 million.

Ms. MacLeod: Have you at any time thought of initiating a value-for-money audit with the city of Ottawa with regard to this project?

Hon. Mr. Caplan: I think I’ve already indicated that subsection (4) indicates all the due diligence with business planning, ridership planning—those have been fulfilled by the city of Ottawa. In fact, I believe that this flight of fancy from this member and from President Baird is simply an attempt to derail a very important investment in the city of Ottawa. This government stands behind its commitment.

Ms. MacLeod: Nothing could be further from the truth when you’re talking about an investment to the magnitude of what we’re talking about—

Hon. Mr. Caplan: We didn’t see it over eight and a half years of the previous government.

Ms. MacLeod: We expect that the money will stay there. There is a lot of support for rapid transit in my community.I’d like to know how much money has actually been transferred to the city for this light rail project.

Hon. Mr. Caplan: None as yet. I can tell you that while there may be a lot of words to support, there was not a lot of financial support by the previous government for light rail investment in the city of Ottawa.

The Vice-Chair: So you’re both ??clear. Okay, go ahead.

Hon. Mr. Caplan: I’ll let the facts speak for themselves.

Ms. MacLeod: I’m just wondering if the minister can indicate whether or not you’ve received copies of the contract of the light rail transit program in Ottawa.

Hon. Mr. Caplan: No, we have not.

Ms. MacLeod: Just to correct, we did a lot of work with—I was working at the city of Ottawa when this was going through—with the member opposite.Essentially, I’m hearing today that it’s quite likely that if the project doesn’t go through with an MOU, we’re probably not going to get the $200 million. That concerns me greatly, considering the federal government has indicated that they will continue to put the—Hon. Mr. Caplan: Mr. Chair, can I send some Q-tips over to the member?

The Vice-Chair: Do you want to continue your line of questioning?

Hon. Mr. Caplan: Because that is not what I’ve said. We stand behind the agreement that we’ve entered into with both our federal and our city partners, and I wish that the member would accurately describe the remarks that I’ve made. The Hansard record will be very clear about this. It has only been the federal government that has wavered in its commitment to this project, and I think that’s regrettable.

The Vice-Chair: It is estimates, and you can continue on with your line of questioning. You’ve got three more minutes

Ms. MacLeod: It just concerns me, knowing what I do know in the community and seeing what we’ve seen in terms of the correspondence and the fact that the mayor-elect actually did write a letter to the Treasury Board president, and that’s why he got involved—we’re still wondering exactly why this letter showed up three days before the municipal election with the candidate who had the as-is project, benefiting, obviously, from this letter, while the other two candidates at the time weren’t—

Hon. Mr. Caplan: Can I answer that or—

The Vice-Chair: Let her finish her question and then you can answer.

Ms. MacLeod: —supporting the current LRT project. I guess what it all comes down to at the end of the day is $200 million that should be going to my city. Quite frankly, we’re nervous that this—

Mr. Wilkinson: He can’t make up his mind how to spend it.

Ms. MacLeod: Well, I come from working at city hall and the one thing that I enjoy about the city of Ottawa is that they’ve got competent city councillors who are duly elected by the people of the city of Ottawa, and they should be able to make the decisions on whether or not—

Interjection.

The Vice-Chair: You don’t need to heckle her, okay? She didn’t heckle you.Go ahead; answer the question.

Hon. Mr. Caplan: Is there a question, Mr. Chair?

Ms. MacLeod: Anyway, Minister, quite clearly, do you not believe that the city of Ottawa elected councillors who were elected last night and the newly elected mayor should define their own transportation and transit initiatives, yes or no? Because this is what it all comes down to, with this letter that you’ve sent to Mr. Kirkpatrick, who is our city manager in the city of Ottawa. It essentially tells us that “if you go outside the parameters of the MOU, even though you’re a new council, we will not be giving you the money.” Former Mayor Chiarelli actually looked at this and took from it that any future monies will be vetoed and the next plan will be vetoed. So I—

Hon. Mr. Caplan: Well, I have the e-mail from Réjean Chartrand to Deputy Minister Layton, copying Mr. Kirkpatrick. It says, “You have no doubt been kept informed concerning the federal funding for the city’s LRT project and the need to have our new city council support the project ... as a condition for the Minister of Transport....”So notwithstanding the fact that our federal government, supposedly in good faith, signed an agreement with the province and the city, it now wants some additional approvals. Notwithstanding the fact that we have the signature on a memorandum of understanding, a federal cabinet minister is now deciding, “Well, notwithstanding any of that, we want some future group of people.” Notwithstanding the fact that the city of Ottawa cancelled it, this member extols the virtue of these elected officials and wants to take it out of their hands. I think that’s reprehensible, because I support local councillors making decisions about local investment. That’s why this government has—anyway, so Ms. Chartrand, I assume—

Ms. Layton: Monsieur.

Hon. Mr. Caplan: Monsieur Chartrand says, “We will use your response in any communications related to this with our council elect. An early response would be appreciated. Please feel free to call Kent or myself directly....” That was on November 6 at 4 o’clock in the afternoon.

Ms. MacLeod: So you just sent a letter three days before the municipal election so that one of the candidates could have a press conference three days before a municipal vote—

Hon. Mr. Caplan: Hold on.

The Vice-Chair: Let the minister finish and then we’re done this round, okay?All right, Minister, if you could finish very quickly because we want to go on to Mr. Tabuns.

Hon. Mr. Caplan: Mr. Chair, we received a request and a request for an early response from the CAO of the city of Ottawa. We provided a response and now we’re being criticized for responding too quickly. Under previous governments, when this member was a staffer, I believe the responses never came forward to our municipal officials. But here’s what deputy Layton says:“Please accept this letter as a confirmation of Ontario’s commitment to the Ottawa north-south light rail ... expansion project as defined in the April 21, 2005 memorandum of understanding approved and signed by Canada, Ontario and Ottawa.”It can’t be any more clear than that. Now, of course, I do wish—

The Vice-Chair: End it quickly now, because I want to get on to the third party.

Hon. Mr. Caplan: I appreciate that, Mr. Chair.From Susan Sherring of the Ottawa Sun:“So it seems Progressive Conservative leader John Tory is ‘disappointed’ Ontario Premier Dalton McGuinty is ‘threatening to withdraw ... funding if Bob Chiarelli isn’t elected.’“Well, I’m disappointed Tory can’t read.“Let’s be clear here.“The Ontario government has informed bureaucrats in Ottawa that they’re on board to hand over their $200 million for the light rail project now in place.“And so it’s ... clear. The money is there for either Alex Munter or Larry O’Brien if they want to build the north-south route the province signed on for.“The province isn’t saying Chiarelli has to be at the helm for the money to be handed over.“And for the life of me, I can’t understand why some believe it’s okay for Treasury Board President John Baird to go back on his word, and withhold federal funding, and yet Tory”—and this member—“is up in arms because the province says it will honour its commitment.“Near as we can tell, Tory is upset because the provincial Liberals are keeping their word. Shame on them.”The Vice-Chair: Okay. Well, we’ll watch for that word to be kept.