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Evaluation of the Harbourfront Centre Funding Program
Department of Finance

December 7, 2010

Table of Contents

Executive Summary

1.0 Introduction

2.0 Profile of HC and the HCFP

3.0 Evaluation Context and Design

4.0 Findings

5.0 Conclusions

6.0 Recommendations

Appendix A HC Revenue and Expenses 1992 to 2009.

Appendix B HC Non-HCFP Revenue 1992 - 2009

Appendix C History of Federal Support to Harbourfront Centre (HC)

Appendix D Alternative Models of Operational Funding by the Federal Government

Appendix E: Management Response and Action Plan

 

List of Acronyms
CA Contribution Agreement
CSPG Canada Square Parking Garage
EDPA Economic Development Partnership Agreement
FTE Full Time Equivalent
GCS Government Consulting Services
GTA Greater Toronto Area
HC Harbourfront Centre
HCFP Harbourfront Centre Funding Program
HF Harbourfront Foundation
IAE Internal Audit and Evaluation
INFC Infrastructure Canada
PAA Program Activity Architecture
PCH Department of Canadian Heritage
PWGSC Public Works and Government Services Canada
QQWLC Queens Quay West Land Corporation
RBAF Risk-Based Audit Framework
RMAF Results-based Management and Accountability Framework
ROI Return on Investment
RPP Report on Plans and Priorities
TB Treasury Board
TTC Toronto Transit Commission
TWRC Toronto Waterfront Revitalization Corporation
TWRI Toronto Waterfront Revitalization Initiative
WT Waterfront Toronto
YQ3 York Quay 3
YQ4 York Quay 4
YQC York Quay Centre

Executive Summary 

This report presents the results of the Evaluation of the Harbourfront Centre Funding Program (HCFP). The evaluation was undertaken for the federal Toronto Waterfront Revitalization Initiative (TWRI) Secretariat. Its scope covers $25 million in operational funding for Harbourfront Centre (HC) and was announced by the federal government in May 2006 for the five-year period ending March 31, 2011.

This funding package was comprised of $4 million set aside in the reference levels of Infrastructure Canada (INFC) for 2006-07 along with $21 million in new HCFP funding from 2006-07 to 2010-11 to be administered by the federal TWRI Secretariat.

HC is a not-for-profit, provincially incorporated organization formed in 1991 in its current structure. It provides the general public with access to cultural, recreational and educational programs and activities on ten acres of Toronto’s downtown waterfront. The HCFP federal funding that was announced on May 23, 2006, builds on previous core financial support for HC by the federal government. HCFP aims to assist HC in covering its fixed operational costs, and facilitate HC’s ability to leverage funding from other levels of government and pursue other revenue-generating strategies that allow the organization to provide the general public with continued access to its programs and activities on the Toronto waterfront.

The purpose of the evaluation was to assess the relevance and performance of the HCFP, by examining the continued need for the program, its alignment with federal government priorities, roles and responsibilities, the achievement of expected outcomes and demonstration of efficiency and economy. The evaluation relied on 2 primary lines of evidence: file and document review, including surveys and studies conducted by third parties; and key informant interviews. In total, 31 interviews were conducted, including representatives of the federal government, other levels of government, and HC management, Board of Directors, corporate sponsors and clients/users. The following are the key findings and conclusions of the evaluation.

Relevance

The evaluation found the HCFP to be a relevant program that is well-aligned with federal government priorities, roles and responsibilities.

HC itself was found to be an organization that is responsive to the needs of Canadians and the artistic community. Its innovative and varied programming speaks to a wide variety of Canadians and visitors to Canada, and satisfies the needs of those who are seeking relevant cultural expression, interesting artistic experiences and novel recreational opportunities.

The objectives of the HCFP were found to align with federal government priorities on a number of fronts, such as contributing to economic development through revitalization of the Toronto waterfront, and support for arts and culture.

Performance

The HCFP has succeeded to a large extent in achieving all of its expected outcomes, with one notable exception. The HCFP was meant to be used by HC to leverage operational funding from other sources, which would be required to achieve financial sustainability. HC still relies on federal funding to a significant extent to “keep the lights on.”

It is clear that HCFP has contributed significantly to HC’s operational stability and that federal funding has enabled the organization to be increasingly successful in the programming area. While the evaluation found that HC is increasingly capable of generating revenues, the organization is viewed as limited in where it can look for operational funding. The evaluation findings suggest some reluctance among HC sponsors/donors to pay for overhead and operations.

Federal funding appears to have played an important role in HC’s ability to leverage support from sponsors and the Toronto municipal government. However, much of this leveraged funding has been targeted for programming, with the exception of funding from the City of Toronto. The perception among HC managers was that the potential to raise additional revenues for operating expenses through existing entrepreneurial activities has nearly been maximized. The evidence collected through the evaluation suggests that if federal funding were withdrawn, HC’s financial viability would be impacted in the short-term, through both the loss of significant operating revenue and potential loss of sponsorship revenues. In this scenario, HC would likely have to reduce the current level of programming it offers to the public or else re-assess its cost recovery strategy.

The evaluation found HC to be a well-respected arts and culture organization, serving the broadest range of linguistic, cultural and racial interests. HC not only offers culturally rich and diverse programming to the greater Toronto community, it is recognized as a world-class arts, culture and educational organization internationally.

HC was found to be reasonably accessible to the general public. While the HC site is well served by public transportation, access by car was found to be somewhat more problematic. Greater awareness among visitors that parking revenues from selected lots provide direct financial support to HC could potentially increase the use of these lots. HC was found to be highly accessible to people with disabilities, cited as one of the best examples of access to cultural events and activities in Canada for people with disabilities.

The evaluation found that HC was associated with positive economic outcomes in three categories: employment outcomes, value-added-impacts (value created through the production of goods and services) and government revenues; based on the evaluation findings it is reasonable to conclude that HC has played a significant role in the economic development of the Toronto waterfront, and in the social and cultural development of the waterfront area and in Toronto in general.

The evaluation found no evidence to indicate that HC uses HCFP funds inefficiently. Evidence collected indicates that the federal TWRI Secretariat, which manages the HCFP, has in place adequate expense verification controls and reporting mechanisms, and that HC has in place the necessary mechanisms to carefully track its operational expenses.

Overall, the HCFP has been viewed by stakeholders as an efficient model of continuing support to HC with positive effects seen in its increasing ability to generate funds from other sources. HC’s level of reliance on federal funding for operational expenses has decreased since 1992 suggesting other sources of revenue have covered some of the expenses. It is beyond the scope of this evaluation study, however, to consider when HC may become weaned off reliance on the federal government for operational funding.

Options related to the management of the HCFP, if renewed, will have to be considered given that the federal TWRI Secretariat is scheduled to disband within a period of 3 years and there are no HCFP-dedicated FTEs. While this file has traditionally been housed either with the federal Minister Responsible for Ontario or the Minister Responsible for the Greater Toronto Area (GTA), in light of HC’s non-profit status and mandate as an arts and culture organization, a better fit may be found housing the program within another federal department.

Recommendations

Recommendation 1: HC at this time relies to a significant extent on federal funding for its operational expenses. A decision is required on an appropriate level and mechanism of federal funding to support operational costs of HC over the short term.

Recommendation 2: The federal government should request a plan from HC outlining its sustainability strategy over the next 2-3 years in the context of any renewed funding program. It should include a business plan for increasing revenues, sponsorships and private sector donations.

1.0 Introduction 

This report contains the results of the Evaluation of the Harbourfront Centre Funding Program (HCFP). The evaluation was undertaken for the federal Toronto Waterfront Revitalization Initiative (TWRI) Secretariat. Section 13 of the program’s terms and conditions and Section 5.2 of its integrated Results-based Management and Accountability Framework/Risk-Based Audit Framework (RMAF/RBAF) specify that an evaluation of the HCFP be completed by spring of 2011. This evaluation fulfills these requirements.

The objectives of the evaluation are to assess the relevance and performance of the HCFP. These dimensions are assessed through a series of evaluation questions, grouped into overarching issues, consistent with the core evaluation issues defined in the Government of Canada Directive on the Evaluation Function.

2.0 Profile of HC and the HCFP 

The HCFP’s primary objective is to provide operational funding support to Harbourfront Centre (HC). Some background information on the origin of HC and the funding program is provided below.

2.1 HC 

HC traces its origins back to 1972, when the federal government purchased approximately 100 acres of downtown waterfront property for the use and enjoyment of Toronto’s residents. Through the Department of Public Works, the government began land rehabilitation and development, and sponsored arts and community events to attract people to the waterfront. As stated in the 1989 Royal Commission Report on the Toronto Waterfront, the federal government created the Harbourfront Corporation in 1978.  At that time, 4 organizational goals were established: i) to develop the Harbourfront as Toronto’s central urban waterfront; ii) to preserve and make accessible Toronto’s waterfront lands to its citizens; iii) to develop the Harbourfront taking into account its history, conditions and location; and, iv) to strive for financial self-sufficiency through the appropriate organization and management of the land.[1] In the following decade, Harbourfront Corporation oversaw considerable public, commercial and residential development, including the opening of a dance theatre, the DuMaurier Theatre Centre (now the Enwave Theatre), and the Power Plant Gallery. The programs offered through these facilities built on already established harbourfront events such as the International Festival of Authors and the Milk International Children’s Festival.

The scale of the development on the waterfront became a matter of public debate in the late 1980’s. In the face of this controversy, the federal government established a Royal Commission, headed by former Toronto Mayor David Crombie, and the provincial government commissioned a separate study by Duncan Allan. In March 1990, Allan’s report proposed guidelines for future waterfront development. Then, in April 1990, the federal government appointed former Ontario Treasurer, Darcy McKeough, to prepare his own analysis of the harbourfront issue based on the provincial report. In November 1990, McKeough proposed the establishment of a not-for-profit charitable organization that would be solely responsible for cultural and recreational programming, and that Harbourfront Corporation’s real estate assets be disposed of to provide the income to fund the programming activities. In January 1991, the federal government implemented the McKeough recommendations creating Harbourfront Corporation (1990), operating as Harbourfront Centre (i.e. HC), a provincially incorporated not-for-profit organization to deliver cultural, recreational and educational programming on the waterfront site.  It also continued Harbourfront Corporation (1984) as Queens Quay West Land Corporation (QQWLC), a Crown Corporation, to manage and dispose of the remaining federal properties in the Toronto waterfront area[2] and established the Harbourfront Foundation (HF)[3] to manage the funds generated from the disposition of these federal real estate assets. HF was charged with making annual payments of income from these funds to HC to help support its program activities. When HC was formed in 1991, the federal government provided approximately 50% of its total revenue and virtually 100% of its operating expenses.[4]

Table 1
HC Timeline
1972 Federal government purchase of 100 acres of downtown Toronto waterfront property
1978 Establishment of Harbourfront Corporation as a federal Crown Corporation
1988 Royal Commission on the Future of the Toronto Waterfront established by federal government, headed by David Crombie
1990 Allan and McKeough reports
1991 Harbourfront Centre and Harbourfront Foundation formed

Today, HC offers cultural, arts, recreational and educational programming to some 12 million visits a year from its location on Toronto’s central downtown waterfront. Its mission is:

To nurture the growth of new cultural expression, stimulate Canadian and international interchange and provide a dynamic, accessible environment for the public to experience the marvels of the creative imagination.[5]

HC delivers its programming on a ten-acre site that comprises three theatres, a rink/pond, a gallery green space, an outdoor stage, boardwalks, access to boating, plazas, and playgrounds, as well as the York Quay Centre that houses craft studios, display venues, multi-purpose facilities and administrative offices.[6]

In addition, the Toronto Waterfront Revitalization Corporation (TWRC), with $25 million in federal funding through the Toronto Waterfront Revitalization Initiative (TWRI), is replacing a 212-spot surface parking lot located on the harbourfront site with a 300-space underground parking garage (the Canada Square Parking Garage – CSPG), which will be combined with the development of a new urban park fronting Lake Ontario known as Canada Square. Current planning calls for the future development of an additional urban plaza on top of the parking facility as well as a cultural/retail village next to the plaza. Once the construction of the CSPG is completed in 2012, HC will retain and operate the facility and will be receiving the revenues generated by the asset.

At this time, HC obtains the revenue it needs for site maintenance and programming from multiple sources including government operating and program funding, corporate sponsorships, public donations, investment income through the HF, registration fees and gate receipts, facilities rentals, parking, marina operations and other commercial activities.[7]

2.2 HCFP 

When the federal government transferred responsibility for cultural programming to HC in 1991, it continued to provide core financial support for that programming as well as site development and maintenance. Appendix C provides a history of federal support to HC.

On May 23, 2006, to fulfill a public commitment made by the Prime Minister to maintain current funding levels for HC over the next five years, the President of the Treasury Board (TB) announced $25 million in funding to HC over a five-year period ending March 31, 2011. This funding package comprised $4 million set aside in the reference levels of Infrastructure Canada (INFC) for 2006-07, and $21 million in new funding from 2006-07 to 2010-11, announced in Budget 2006.

The $4 million in funding INFC provided to HC in 2006-07 was transitional in nature. INFC received an increase to its reference levels in 2006-07 of $4 million to support this contribution. The one-time contribution was designed to allow HC to remain operational and to alleviate short-term pressure on the organization while awaiting approval and access to long-term funding (i.e. the additional $21 million which was later provided via the HCFP). INFC provided this funding to HC given that at the time the Minister of State for Infrastructure was also responsible for the QQWLC which was historically the conduit for payments to HC, but was dissolved on March 31, 2006.

The $21 million contribution agreement with HC was signed on January 29, 2007, and is administered by the federal TWRI Secretariat, currently housed at the Department of Finance.[8] The federal TWRI Secretariat charged with administering the HCFP has 12 Full Time Equivalent (FTE) positions whose primary responsibilities are to lead policy development and program management on behalf of the federal government as it relates to the TWRI – there are no dedicated FTEs allocated to the HCFP. This Secretariat is responsible for the ongoing business and coordination of the TWRI with its partners (the Province of Ontario and the City of Toronto), the TWRC and other stakeholders for the development, funding and implementation of TWRI projects. Since its creation, the federal TWRI Secretariat has been housed with the Minister Responsible for the GTA or the Minister Responsible for Ontario.[9] Federal TWRI funding was scheduled to sunset on March 31, 2011, but in the summer of 2010, the program terms and conditions were extended until March 31, 2014.  The TWRI is currently winding down, with the federal TWRI Secretariat scheduled to end operations no later than March 31, 2014.

Program Objective

The primary objective of the HCFP is to provide operational funding support to HC until March 31, 2011. Such support will assist HC in covering its fixed operational costs and will also facilitate its ability to leverage funding from other levels of government and pursue other revenue-generating strategies that allow the organization to provide the general public with continued access to cultural, recreational and educational programs and activities on the Toronto waterfront.[10]

The expected outcomes of HCFP are:

The ultimate outcome of the HCFP is to allow HC to contribute to the economic growth and the social and cultural development of the Toronto waterfront.

Program Beneficiaries

The HCFP integrated RMAF/RBAF lists the program’s key stakeholders and beneficiaries as:

3.0 Evaluation Context and Design 

3.1 Evaluation Objectives and Scope 

The main objective of this evaluation is to assess the relevance and performance of the HCFP, including program design, efficiency and economy. The evaluation is meant to provide decision-makers with evidence-based information that can be used in program renewal and changes or modifications that may be needed in the design and delivery of the program in order to improve its efficiency and effectiveness. The scope of this evaluation includes the program activities of the HCFP over the five-year period from 2006-07 to 2010-11, and includes the $4 million HC received from INFC in 2006-07, and the $21 million administered by the federal TWRI Secretariat.

3.2 Evaluation Methodology 

The methodology for this evaluation was developed initially by Government Consulting Services (GCS) in consultation with officials from the federal TWRI Secretariat and the Internal Audit and Evaluation (IAE) Branch at Finance Canada. The GCS’s proposed methodology, including some of the evaluation questions, was later modified somewhat in order to expand the scope of the evaluation and to make the evaluation questions more focussed. Supplementary evaluation work was carried out by Ian Martin Ltd. The IAE Branch provided stewardship services for the evaluation and was involved in the different phases of the evaluation, including the writing and preparation of this final report.

This section outlines the evaluation issues and questions, data collection methods, and other methodological considerations for the evaluation, including its limitations.

3.2.1  Evaluation Issues and Questions 

Issue Evaluation Question(s)
Issue 1 Continued Need for the Program (Relevance)
  • Is HC responsive to the needs of Canadians?
  • Does HCFP continue to address a demonstrable need?
Issue 2 Alignment with Federal Government Priorities
  • Are the objectives of the HCFP consistent with federal government priorities?
Issue 3 Alignment with Federal Government Roles and Responsibilities
  • Are the objectives of the HCFP consistent with federal government roles and responsibilities?
Issue 4 Achievement of Expected Outcomes (Performance)
  • Has the HCFP provided a stable foundation for HC operations?
  • Has HC devised successful revenue-generating strategies?
  • Has HC produced innovative cultural, recreational and educational programs and events?
  • Is HC accessible to the general public?
  • Has the HCFP enabled HC to support the economic, social and cultural development of the Toronto waterfront?
  • Has the HCFP produced any unintended outcomes?
Issue 5 Demonstration of Efficiency and Economy (Performance)
  • Does HC use HCFP funds efficiently and economically?
  • Are there are any alternative or more cost-effective ways of achieving the desired outcomes?

3.2.2 Data Collection Methods 

File and document reviews, including a review of financial and administrative data as well as key informant interviews are the primary means used to address the evaluation questions and to draw conclusions about the relevance and overall performance of the program.

3.2.2.1 Document Review 

The review of relevant documentation was used to develop the program profile and to conduct an assessment of the relevance and the performance of the program. Discussions with HC management identified a large volume of relevant information, including visitor surveys and studies. In addition, program documentation available from the federal TWRI Secretariat provided insight into the relevance of the HCFP.

The following types of documentation were reviewed during the evaluation:

Corporate, accountability and program documents: including HC financial statements, audits and reports; quarterly reports; the contribution agreement; and other related documents;

Other relevant reports: including the 2008 Evaluation of the Federal Government’s Participation in the TWRI,[13] HC planning reports, program descriptions and profiles, newsletters, economic impact analyses and surveys; and,

Media and government releases: including articles relating to the activities and outcomes of HC.

Because the documents provided a significant amount of information related to many of the questions that the evaluation initially expected to be answered through a survey of HC clients and users, a decision was made not to undertake a survey as part of this evaluation. However, results from previous studies including visitor surveys conducted by EKOS in 2003 and 2006, on behalf of HC, were used in the evaluation. In addition to the EKOS reports, the evaluation had access to the reports on internal Visitor Feedback Forms collected for the past five years by HC. The evaluators used a customized template that organized and structured the data extracted from the document review to help answer the evaluation questions.

3.2.2.2 Key Stakeholder Interviews 

A total of thirty-one interviews were completed for the evaluation (Table 2). The evaluators interviewed personnel from HC, the federal TWRI Secretariat and INFC, as well as stakeholders from community associations and non-profit and cultural organizations that have participated in HC programming and activities. Interviews were done either in person or over the phone.

Table 2
List of Interviews by Interview Group
Interview Group Interviews Conducted
Federal Government - Federal TWRI Secretariat 4
Federal Government - Infrastructure Canada 1
Other Governments - City of Toronto 2
HC Management 7
HC Board of Directors 4
HC Users/Clients 10
HC Corporate Sponsors 2
HC Individual Donors 1
Total 31

Three interview guides were used.  One guide, comprising 28 questions dealing with all the evaluation issues, was used for the interviews with “managers and directors,” individuals representing government organizations or HC. The second guide, comprising 7 questions that focused on HC’s performance, was used for interviews with HC “users/clients.” A third guide was used for interviews with HC sponsors/donors. Follow-up interviews were conducted with selected respondents, to collect supplementary information to support evaluation findings. All interviewees were contacted in advance to schedule an appropriate time and received an interview guide in advance of the interview. Interview notes were entered into a database for subsequent analysis. The interviewees were informed that their individual responses would be confidential and that the final evaluation report would present interview findings in aggregate form.

3.2.2.3 Administrative and Financial Data Review 

Two major types of administrative data were analyzed during the evaluation: HC program data related to activities and outputs of the organization, and HC financial data.

Program activity and output data consisted of information describing the number and types of programs and events that took place during the period under evaluation. Information collected for the evaluation about program activities and outputs helped address questions relating to program performance.

Financial information from HC was analyzed to assess the organization’s continuing need for HCFP funds, and the extent to which HC has been successful in generating revenues or in leveraging funds from other sources.

Financial and program data were also examined to assess the extent to which HC is meeting its reporting requirements as articulated in the contribution agreement. This information included a review of HC’s quarterly progress reports and its audited annual financial statements.

3.3 Limitations 

The following are some of the methodological limitations that should be noted:

While there are limitations to the evaluation methodology, the evaluators sought to enhance the evaluation’s reliability and validity by using multiple lines of evidence, wherever possible.

4.0 Findings 

4.1 Issue 1: Continued Need for the Program (Relevance) 

To assess the relevance of the HCFP, the following evaluation questions were asked:

The first question explores the program relevance at the level of HC itself, and assesses the extent to which it continues to be responsive to the needs of Canadians. The second question considers relevance of the HCFP and the continued need for the federal government to provide operational funding support to HC. This latter question is intrinsically linked to the achievement of the expected outcome of HCFP to provide a stable foundation for HC operations, which will be examined, in section 4.4.1. This section will focus on the relevance of HC, while the issue of whether the HCFP continues to address a demonstrable need is left to section 4.4.1.

HC's mission is:

To nurture the growth of new cultural expression, stimulate Canadian and international interchange and provide a dynamic, accessible environment for the public to experience the marvels of the creative imagination.

HC and its programming could be considered relevant if the core concepts expressed in this mission statement, as well as the actual programs and events produced by the organization, coincide with what matters to Canadians. Based on results in a report entitled Harbourfront Centre: A Research Survey of its Visitors and Prospective Visitors (2004), it appears as though HC’s mission, values, and programming are very much in line with what Canadians want. The report makes the following observations based on its survey results (Chapter 9: Key Attitudes Toward Harbourfront Centre):

The results of the interviews conducted for this evaluation also support the idea that HC remains relevant to Canadians and to the artistic community. Interviewees unanimously agreed that HC provides relevant programming and events that reflect the interests of Canadians.

As indicated in sections 4.4.2 and 4.4.4 of this report, it appears that the programs and events developed and/or organized by HC are both accessible and highly innovative from a cultural, recreational and educational standpoint. Furthermore, section 4.4.5 provides some evidence that HC has played, and continues to play, an important role in the economic, social and cultural development of the Toronto waterfront. The information collected indicates that HC’s programming speaks to a wide variety of Canadians and visitors to Canada, and the innovative and varied nature of the programming satisfies the needs of those who are seeking relevant cultural expression, interesting artistic experiences and novel recreational opportunities.

HC is also responsive to Canadians’ needs on an ongoing basis. Section 4.4.4 details the processes that HC has in place to ensure that its offerings reflect the needs and wants of the general public and of the artistic community. HC’s Strategic Access Plan for Linguistic, Cultural and Racial Diversity (2004) is the main vehicle the organization uses to ensure that the organization as a whole remains relevant, accessible and reflective of what Canadians need and want.

Taken in sum, these sources of evidence demonstrate that the organization is relevant to Canadians.

4.2 Issue 2: Alignment with Federal Government Priorities 

To assess the issue of whether the HCFP is aligned with federal government priorities, the following evaluation question was asked:

The evaluation found that the main objective of the HCFP, which is to provide operational funding to HC, and HC’s activities, intersect with federal government priorities on a number of fronts. First, the underlying focus of HC on contributing to the economic development of the Toronto waterfront parallels the intense focus that the Government of Canada has placed on economic development over the last several years. Speeches from the Throne for 2008[15], 2009[16] and 2010[17] all clearly demonstrate government priorities centered on stimulating the economy in response to global and domestic financial challenges. Canada’s Economic Action Plan[18] is a prime example of federal action aimed at stimulating the economy. Specific issues that comprise current government priorities in this area include job creation, job protection, economic opportunities and infrastructure growth and development. HC supports these priorities through direct and indirect employment and through sales of goods and services associated with on-site operating and capital expenditures. The impacts of this support are discussed in more detail in section 4.4.5.

In addition to the consistency between the federal government’s economic priorities and HC’s on-site and capital expenditures and their associated spin-offs, HC’s primary focus as an arts and culture organization coincides with many of the policies and programs that are supported by the federal government. For example, HC’s offerings such as broadcasting and digital media, film and video, music, festivals and performing arts and cultural spaces are in line with numerous programs that are supported by the federal government via various funding mechanisms and programs, mainly through the Department of Canadian Heritage (PCH). HC plays a significant role in supporting and encouraging arts and culture and the organization can, therefore, be seen as well-aligned with federal funding and programs in this area.

Given HC’s capacity to contribute to the local economy and provide a stable platform for wider harbourfront development and to provide relevant cultural expression, interesting artistic experiences and novel recreational opportunities, it is reasonable to conclude that the objectives of the HCFP are consistent with federal government priorities in the context of the development of the waterfront.

4.3 Issue 3: Alignment with Federal Government Roles and Responsibilities 

Considering that HC is an arts and cultural organization located on the Toronto waterfront, this evaluation issue is assessed in terms of the federal government’s roles and responsibilities relating to waterfront development as well as arts and culture.

The Government of Canada has a well-established record of supporting waterfront development projects throughout the country. Notable examples include:

More recently, the federal government, under the Economic Action Plan and the Infrastructure Stimulus Fund ($4B), has played a major role in supporting many existing and new infrastructure development projects, including waterfront redevelopment.

Examples of recent federal involvement in waterfront development projects include:

The federal government also plays an active role in promoting the arts and culture in Canada, for example, through PCH, whose support for arts programming and arts institutions is delivered through a variety of initiatives, including:

Federal support for cultural institutions is also manifested through Crown Corporations such as the National Arts Centre in Ottawa (the NAC) and through support for organizations such the Fathers of Confederation Building Trust Program that provides ongoing operational and programming funding to a designated recipient, the Confederation Centre for the Arts in Charlottetown. However, it is important to note that while these programs may include an operational component as part of their funding regime, they are different from the HCFP whose funding scope is exclusively for the operations of a not-for-profit entity.

The majority of the interviewees, including those not affiliated with the Government of Canada, did not see any inconsistency between the federal government’s involvement in this program and its roles and responsibilities in general. These interviewees have underlined the importance of the HC for Toronto’s economy and culture. They have identified the HCFP and the federal government’s involvement in this program as one of the most important factors for enabling HC to leverage funding from other levels of government and private sponsors/donors. Accordingly, the HCFP is being perceived as part of the federal government’s contribution to Toronto’s economic and cultural development.

Taking into consideration all of these factors (historical precedents, current Government of Canada support for waterfront revitalization projects, and consistency with what happens elsewhere), federal government support for the development of the Toronto waterfront, to which the HCFP is linked, could be considered well-aligned with federal roles and responsibilities. Similarly, the HCFP could also be considered aligned with ongoing federal government support for the arts and culture sector. However, an important question is whether federal support should go on indefinitely. Based on the other examples cited in the evaluation, it is not clear that this is a common approach for the federal government. The evaluation was also unable to find other examples of the federal government exclusively supporting operational expenses of a not-for-profit organization.

4.4 Issue 4: Achievement of Expected Outcomes (Performance) 

4.4.1  Assessment of Whether the HCFP has Provided a Stable Foundation for HC Operations 

In this section the federal contribution to HC’s fixed operational expenses, and the effect this has had on the stability of HC’s operational foundation, are assessed. The assessment of whether the HCFP has contributed to HC’s ability to leverage funding from other sources is explored in section 4.4.3.

As previously noted, according to the HCFP integrated RMAF/RBAF, the primary objective of the HC Funding Program is“to provide operational funding support to the HC until March 31, 2011. Such support will assist HC in covering its fixed operational costs and will also facilitate HC’s ability to leverage funding from other levels of government and pursue other revenue-generating strategies that allow the organization to provide the general public with continued access to cultural, recreational and educational programs and activities on the Toronto waterfront.”[24]

In order to visualize the role that HCFP funding has played in HC’s ability to carry out normal operations (and therefore deliver its programming), it is instructive to analyze HC’s annual revenues, expenses, and federal funding levels over time. To do this, total revenue, total federal funding and total operational expenses are plotted on an annual basis, from 1992 to the present (since total revenues and total expenses are not yet available for 2010 and 2011, these quantities are held at 2009 levels for the purposes of this analysis). Operational expenses are placed into the following categories: marketing, facilities, management & finance, severance payments and amortization of capital assets. The results are presented in Figure 1.

Temporal trends in HC revenue and expenses can be observed from the percentage of total HC revenue from federal sources, percentage of total operational expenses from federal sources, and total operational expenses as a percentage of total revenue, which are plotted annually, from 1992 to the present in Figure 2. The data used to generate Figures 1 and 2 can be found in Appendix A.

Figure 1. HC Total Revenue, Total Federal Funding and Total Operational Expenses

Figure 2. Percentage of HC Total Revenue and Operational Expenses Provided by Federal Fundsing and Total Operational Expenses as a Percentage of total revenues.

Figures 1 and 2 reveal several interesting trends. HC total revenue has increased substantially since 1992; it almost doubled, from about $16 million in 1992 to about $30 million in 2009. Total operational expenses have also climbed, from about $9 million in 1992 to about $16 million in 2009. However, operational expenses as a percentage of total revenue have remained fairly stable between 45% and 58%. Total federal funding for this period first declined between 1992 and 2001 and then remains more or less stable from 2002 to the present (slight increase). The percentage of total HC revenue from the federal government declined sharply between 1992 and 2000 and then remained relatively stable. Likewise, the percentage of total HC operational revenue from federal sources dropped markedly between 1992 and 2001 and increased slightly to remain stable from 2002 to the present (this assumes all federal funding has been allocated to operational expenses – see the discussion below).

To interpret these trends, it is first necessary to observe that, between roughly 2001 to the present, all of the key quantities presented in Figures 1 and 2 remain fairly stable except total revenue and total operational expenses. The positive correlation between increasing total revenue and increasing total operational expenses is as one might expect: as programming has expanded and HC has been involved in more activities, total revenue has increased and this has cost the organization more in terms of operational inputs (e.g. staff, resources, facilities etc.). The most significant observation, however, is that HC total revenue has increased steadily between 1992 and the present. These data suggest that HC is increasingly capable of generating revenue. If we assume for a moment that the trends presented in Figures 1 and 2 are held constant into the future, and revenue continues to increase, then it follows that federal funding will play an increasingly smaller role in HC’s overall revenue/expense portfolio. Based on these data, a reasonable assumption could be made that HC’s maturity and increasing ability to raise funds mean that over time it has the capacity to become less reliant on federal operational funding. However, this assumption may not fully reflect HC’s operating context. Interviews with HC personnel, suggest that the organization is perceived as limited in where it can look for operational funding.

At this time, HC’s operational funds come from three sources: the HCFP, the City of Toronto and revenue from its entrepreneurial activities. Toronto provides HC with $750,000 per year in operational funds which are intended to do the same things that the HCFP does, such as pay for lights, heat and other operational necessities. This grant funding began in 2007 and ends in 2017. The second source of municipal funding is “state of good repair” funding, which is intended to provide additional capital resources for infrastructure repair and renewal. This funding is for $3 million for the period 2007–17. The third major source of operational funding for HC is comprised of the organization’s entrepreneurial activities. This includes revenue from parking facilities[25], from the two marinas that HC operates and from all other revenue generating businesses and activities. Additionally, HC has been getting injections of cash to cover operating expenses from HF. These cash influxes are being provided by the Foundation to make up for shortfalls that have resulted from the discontinuation of revenues from the YQ4 parking facility at 200 Queen’s Quay West.

HC personnel, corporate sponsors/donor interviewed were of the opinion that HC cannot turn to program or event sponsors for the resources needed to support overhead and operations. The sponsors that were interviewed stated that base operational funding is necessary for their continued support. Information collected through interviews indicates that some project-specific funding may come with built-in administration or overhead allowances; however, this does not account for an appreciable amount compared to the total cost of running a program or event. For corporations interested in brand exposure and for individuals interested in supporting specific types of cultural expression or specific events, providing operational funding to HC is not considered an attractive prospect. Thus, when we look at the growth in HC revenue over time, and when we observe that the organization seems to be increasingly capable of raising funds, it is important to understand that this growth in funds have been, for the most part, event-specific funds. The money is dedicated to specific programming - the extent to which it can contribute to operational expenses is limited. This type of funding is not intended to support the maintenance of HC infrastructure. Interviewees suggested that HC’s ability to obtain event-specific funding rests on the operational funding it receives from the federal government and from the City of Toronto. Without this operational funding, HC may not be able to maintain the infrastructure it needs to attract program support from sponsors/donors and other sources.

It is difficult to say with certainty what would happen if HC is faced with increasing gaps in operational funding. On the one hand, the organization is clearly getting better at finding resources and is increasingly successful overall. On the other hand, as outlined above, much of this success is linked to program, not operational resources. Part of this reality is also linked to HC’s mandate to provide about 70% of its programming for free. If operational shortfalls were to occur in the future, it seems likely that HC would, in the short term, be forced to reduce its programming and offerings to the public or else reassess its cost recovery strategy. The next section will further examine HC’s ability to leverage additional operational funding.

To conclude, there is evidence that the HCFP has contributed significantly to HC’s operational stability and that operational support has enabled the organization to be increasingly successful in the programming area. Currently, the HCFP accounts for about a third of HC’s operational expenses. The remainder of operational funding comes from the City of Toronto, the HF and from HC’s entrepreneurial activities, especially parking revenues. HCFP is clearly an important source of operational funding to the organization at this time. Reducing or removing these resources could negatively impact the organization in the short term. Whether HC would be able to eventually mitigate this in the long term is difficult to predict without further analysis that is beyond the scope of this evaluation.

Recommendation 1: Harbourfront Centre (HC) at this time relies to a significant extent on federal funding for its operational expenses. A decision is required on an appropriate level and mechanism of federal funding to support operational costs of HC over the short term.

4.4.2  Assessment of Whether HC Has Devised Successful Revenue-Generating Strategies 

As indicated in the HCFP RMAF/RBAF, one of the secondary objectives of the HCFP is tofacilitate management’s ability to leverage funding from other government and corporate sources as well as its ability to pursue other revenue-generating strategies to ensure ongoing community access to HC’s cultural, recreational and educational facilities.” It was hoped that this “would ultimately lead to a financially viable operation that will support the economic, social and cultural development of the Toronto waterfront.”[26]

To assess the program’s success in achieving this objective, we first examine HC’s existing non-HCFP sources of revenue. These sources include:

Table 3
HC Non-HCFP Revenue Sources
Revenue Source 2009
(% of non-HCFP revenue[27])
Description
Corporate sponsorships (14.55%) Money tied to programming that comes from corporate sponsors who seek branding, marketing and product endorsement opportunities. Individual giving and donations are included in this category.
Event admissions & registrations (12.69%) Events where HC sells tickets and charges a price for admission. Registrations include summer camps. Camps are a large revenue item for HC.
Government programming grants (12.69%) Non-operational government grants from, for example, the Toronto Arts Council, Ontario Arts Council, Ontario Trillium Foundation, Ministry of Natural Resources, and Ministry of Agriculture.
Parking, concessions & other incomes (22.70%) Parking revenue, concessions revenue (e.g. food and beverage sales), sailing school revenue, revenue generating operation of 2 marinas. This category represents a significant amount of revenue for HC, particularly the parking income.
Facility rentals (5.30%) Revenue from the rental of HC facilities to third parties. This is a fairly small source of revenue, partly because HC is using its own facilities most of the time.
Donations in kind (11.59%) These are free goods or services given to HC by third parties. Examples include free advertising in local newspapers and free flights for artists given by airlines. This revenue stream is very significant for HC.
City of Toronto operating funding (5.54%) Operating money consisting of $750,000/year from 2007 to 2017 and $3 million over the same period for state of good repair projects.
Harbourfront Foundation (7.91%) Harbourfront Foundation was set up by the federal government and its sole purpose is to hold and flow money to HC. A 17-member board makes decisions on amounts to be flowed to HC. Funds are restricted and unrestricted. Generally, only interest on capital can be used by HC.
Amortization of deferred contributions (7.04%) Capital projects that provide contributions that span more than one year. The contributions are deferred against the amortization of the asset.
Federal parking subsidies (0.00%) Time limited subsidies that were provided by the federal government either via revenue from the YQ4 parking garage at 200 Queen’s Quay West or as was the case in 2004-05 and 2005-06, to compensate for the loss of YQ4 revenue.

To visualize how these sources of revenue have varied over time, specifically from 1992 to 2009, annual revenue amounts for each source are plotted in a time series in Figures 3a and 3b. Similarly, to get a sense of how the total of all sources of non-HCFP revenue has varied over time, total non-HCFP revenue is plotted in a time series in Figure 4.

Figure 3a. HC Non-HCFP Revenue - Individual Sources

Figure 3b. HC Non-HCFP Revenue - Individual Sources

Figure 4. HC Non-HCFP Revenue - Total

Figures 3 and 4 reveal several important trends. First, although there is considerable variability in several of the revenue sources, none appear to be clearly decreasing with time (Figs. 3a and 3b) (federal subsidies via YQ4 parking revenue and the $1.4 million that flowed to HC for operational support - $700,000 in each of 2004-05 and 2005-06) are an exception, because these were time-limited subsidies. Second, a number of the revenue sources appear to be increasing with time (parking, concessions and other revenue, donations in kind, government programming grants, amortization of deferred contributions, corporate sponsorships, and a slight increase in facility rentals). Parking, concessions and other revenue in particular have increased dramatically between 1999 and the present. Finally, it is clear from Figure 4 that total non-HCFP revenue has been increasing at a steady rate since 1992. Total revenue has increased from about $8 million in 1992 to just over $25 million in 2009.

These observations demonstrate that HC has been successful in putting in place effective revenue-generating strategies over the last 19 years. No sources of non-HCFP revenue have disappeared over the last 10 years and, as described above, several revenue streams show signs of steady increase. However, an important question to consider here is whether it is reasonable to expect these revenue sources to continue to increase well into the future. The quantitative data clearly demonstrate a trend toward increasing non-HCFP revenues. However, HC managers indicated in interviews that they feel that many of the available revenue streams have been close to fully exploited. One area that HC staff consistently pointed to when asked whether they could foresee growth in specific revenue streams was parking. The HC Canada Square Parking Garage (CSPG) is currently under construction and should provide HC with about $1.7 million in net annual revenue when completed. HC continues to seek access to another parking facility located at 200 Queen’s Quay West (YQ4) – which it operated between 1996 and 2004 and which is presently owned by Public Works and Government Services Canada (PWGSC). If this occurs, HC will have access to another steady source of annual revenue.

The central question for the purposes of this discussion is whether the success HC has had in establishing and growing its various revenue streams, and the success it expects to have in these areas in the future, has the potential to lead the organization to financial self-sufficiency. Section 4.4.1 identified that there is a distinction between funds that are raised and used for programming and funds that can be used to cover operational expenses. Also, the HCFP provides HC with roughly one third of the money it needs to operate, with the remainder coming from the City of Toronto, HF and entrepreneurial activities. In order for HC to be self-sufficient (and maintain its current level of programming) under a scenario where federal funding was not present, it would have to find more that 5 million dollars per year in operational funding (assuming that the municipal funding remained stable, which may not be the case if federal funding was absent – see discussion below). Answering the question of whether this is possible must rest on an analysis of the untapped potential of existing or new revenue generating activities that could be undertaken by HC (excluding program-related revenue, since it has been shown that program funding is limited in its use to support operations). If the money that could be raised by HC in devising and implementing additional revenue generating strategies is equal to or greater than the shortfalls that would follow the withdrawal of federal funding, then HC could well become financially self-sufficient. If, as HC managers have stated in interviews, the potential for the organization to raise additional entrepreneurial funds is limited, then the withdrawal of federal funds would mean that HC would have to reduce the programming it offers to the public or else reassess its cost recovery strategy.

The final consideration in this section is an assessment of the role that the presence of federal funding plays in HC’s ability to leverage additional funds. Based on interview data collected from corporate sponsors, there is a clear perception that HC is a federal creation. Those interviewed clearly expressed that their willingness to continue supporting HC is predicated on the presence of federal-based operational funding. In the case of the City of Toronto, managers brought the 10 year operational funding agreement before city council once the decision regarding federal funding was announced in 2006.   Evidence from the interviews suggests that the presence of federal funding, and the presence of the federal government at the table in general, plays an important role in HC’s ability to leverage funding from sponsors and from the Toronto municipal government. Interviews with sponsors also suggest that if federal funding was reduced or removed, this would have a negative impact on some of HC’s most important sources of support.

HC continues to depend on the federal funding in order to cover operational expenses or to “keep the lights on”. Its dependency on the federal funding is less in 2009 than in 1992 as revenues generated from other sources including donations, corporate sponsorship, parking and concessions and event admissions and registrations have increased. Although there were year-to-year fluctuations, the trend had been toward larger annual totals whereby in 2009, $25 million of revenue generated is acquired from other sources than federal funding, as compared to $8 million in 1992. Revenue from parking can also be expected to increase in the future when construction of the CSPG is completed in 2012. Once the construction is completed, HC will retain and operate the facility which is expected to generate approximately $1.7 million in annual revenue.

Recommendation 2: The federal government should request a plan from HC outlining its sustainability strategy over the next 2-3 years in the context of any renewed funding program. It should include a business plan for increasing revenues, sponsorships and private sector donations.

4.4.3 Assessment of Whether HC Has Produced Innovative Cultural, Recreational and Educational Programs and Events 

The following table, based on HC's programming for 2009-10 (from HC's web site), provides an overview of the number of events held by HC in various categories.

Table 4
Event Categories and Number of Events Held by HC in 2009-10
Event Category Number of Events (2009-10)
Theatre 15
Music 30
Dance 39
Visual Arts and Crafts 36
Visual Arts Exhibitions 16
Literary Arts 17
Film 6
Festivals 39

Some of these events take place within major festivals such as the World Routes Festival, International Festival of Authors and Harbour KIDS weekend festivals. Table 4 enumerates the breadth of programming offered by HC for 2009-10.

This information indicates that HC has produced and supported a very wide range of cultural, recreational and educational programs and events. Many of these events have been innovative and unique, particularly the theatre and dance. Events have reflected the gamut of cultural possibilities, including programming of North American, European, Asian and African origin and content. Likewise, HC has offered an equally wide range of educational opportunities, particularly for children. If unique and challenging artistic expression is used as the definition of educational, then it could be argued that the majority of the programs that HC offers could be considered educational in some respect. In terms of recreation, opportunities include ice skating, wide boardwalks for strolling by the lake, green spaces and parks for outdoor pursuits, and a wide range of boating options. Interviewees universally agreed that HC’s offerings are high quality, innovative and unique.

Section 4.4.4 assessed whether HC and its facilities are physically accessible, including accessibility for disabled people. In this section, cultural accessibility is assessed, as HC is expected to provide innovative cultural, recreational and educational programs and events. Consequently, HC is examined to determine whether its programming reflects an appropriate range of linguistic, cultural and racial perspectives.

HC has put in substantial effort to make its facilities and programming accessible from a linguistic, cultural and racial perspective. In 1992, HC developed and implemented a Strategic Plan for Ensuring Access for Linguistic, Cultural and Racial Groups.[28] Then, in 2004, HC decided to re-assess its performance in this area by engaging Enidlee Consultants to prepare a report card on the implementation of its original plan and to formulate a new strategic plan for maximizing this type of access. The report card was entitled Promises and Possibilities Report Card on ”Opening Up” Harbourfront Centre’s Access Plan for Linguistic, Cultural and Racial Diversity.[29] The report card contained in this document led to a new strategic plan: Strategic Access Plan for Linguistic, Cultural and Racial Diversity in 2004.[30] The new plan contains a summary of HC’s accomplishments and challenges from the previous 12 years in the area of cultural access and identifies the elements of the new strategic plan, including how to foster culturally rich and diverse programming, how to improve communication, how to leverage human resources, and how to overcome existing organizational obstacles in this area. These activities show that HC takes linguistic, cultural and racial diversity seriously. HC’s activities in this area are also current and up to date, the Strategic Access Plan for Linguistic, Cultural and Racial Diversity covers the period from 2006-09. Finally, HC actively maintains an Access Steering Committee to oversee matters related to linguistic, cultural and racial diversity.

The diversity of people who visit HC’s site is also reflected in visitor research. The 2004 EKOS visitor survey makes the following key observations which reflect the diversity of visitors:[31]

All evaluation interviewees indicated that HC is a well-respected arts and cultural organization, and as a result of its national and international reputation, has been able to attract leading edge international and national performances and exhibitions. For example, interviewees described HC as having programs that are a bit edgier than other established venues. It is considered a trend setter in that regard. HC has been able to attract leading edge international and national performances and exhibitions including the World Stage Festival and the International Festival of Authors.

According to internal documents, media coverage and interviews, HC is recognized internationally in the arts and culture sector as numerous international groups have sought out their expertise on the development of similar projects. For example, contingents from San Francisco’s Yerba Buena Centre for the Arts, Singapore’s Esplanade Centre and Bermuda’s St. George’s area have all engaged HC for both paid and unpaid consulting work to assist and advise the development of similar projects in those countries. Over the many years of operation, the HC CEO has been asked to speak at international conferences and symposia in Tokyo, Singapore, Beijing, Bermuda and New York, for example, on various topics including: cultural planning, community engagement, waterfront revitalization, and citizen engagement. HC has, over the years, been involved in consulting on international cultural projects, which suggests it is viewed as a well-respected cultural and artistic organization.

Taken as a whole, and based on the evidence presented above, it is reasonable to conclude that HC is a respectable arts and culture organization, serving a broad range of linguistic, cultural and racial interests. Educational and recreational opportunities are also abundant, particularly due to the favourable characteristics of the HC site, including its proximity to Lake Ontario. As such, not only does HC offer culturally rich and diverse programming to the greater Toronto community, it is also recognized as a world-class arts, culture and educational organization internationally.[32]

4.4.4  Assessment of Whether HC is Accessible to the General Public 

The most comprehensive source of information available on how people physically access HC is a 2004 EKOS report entitled Harbourfront Centre: A Research Survey of Its Visitors and Prospective Visitors.[33]The report makes the following general observations based on the data collected on how visitors access HC:

Many visitors use HC’s parking facilities and there is significant evidence that this would increase if they were aware that the proceeds go to HC:

While access by public transit is viewed favourably, the same cannot be said for access by car or parking. Access by car and parking are some of the most poorly rated aspects of HC — access by public transit, however, is rated very well.

Parking and transportation problems act as deterrents to more frequent visits. For example, significant numbers of those who were surveyed agree that they would visit more frequently if parking were less expensive and if it were less trouble to get to HC. Traffic congestion and distance are cited as the two biggest issues. These are not particularly significant issues for those who take the TTC or arrive by their own locomotion, however.

These results show that, overall, HC appears to be reasonably accessible to the general public. The survey shows that many people who visit the site, particularly Torontonians, use public transportation or walk, cycle or rollerblade. This is strong evidence to support the notion that the HC site is well served by public transportation. These results remained unchanged in a visitor survey conducted in 2006.[34]

Despite good access via public transportation and evidence that public transportation is well used, one area that is somewhat problematic from an accessibility standpoint is access by car. The majority of people who visit the site from the outer-GTA do so by car. Six out of 10 people arriving by car use HC parking facilities; however, the cost of parking and traffic congestion were cited by survey respondents as deterrents to more frequent visits to the site. An especially significant finding is that survey respondents were not aware that revenue from the parking lots supports HC. Most significantly, 4 in 10 respondents said that the knowledge that parking revenues support HC would make them more likely to use the parking facilities around the HC site. Notwithstanding the limited number of parking facilities, it is likely that greater awareness about where parking revenues go could lead vehicle users to choose lots that they know provide direct financial support to HC.

Evidence collected during interviews that were conducted in the course of this evaluation also supports the assertion that HC is highly accessible to the general public. Interviewees universally agreed that public transportation to the site is excellent and that many people use public transportation to access HC programs and events.

In terms of access to the HC site for disabled people, two sources of information are pertinent: a York Quay Centre (YQC) self audit for accessibility[35] and information collected during interviews. The YQC self audit is a detailed assessment of the level of accessibility for the areas and facilities under HC's management. For each of these areas, the audit includes aspects that are compliant with the requirements of disabled people and aspects that are not and therefore need to be modified or otherwise addressed.

The perception of the majority of interviewees is that HC is highly accessible to people with disabilities. The waterfront site is described as having ramps and elevators throughout that are accessible during operating hours. HC is described as highly accessible with the physical space that accommodates all visitors to the site. No specific problems related to access for persons with disabilities is noted in interviews. According to internal documentation, HC has been audited periodically for accessibility and physical upgrades are regularly planned to constantly improve access. HC is further described in interviews as one of the best examples of access to cultural events and activities in Canada for people with disabilities.

4.4.5  Assessment of Whether the HCFP Has Enabled HC to Support the Economic, Social and Cultural Development of the Toronto Waterfront 

A detailed picture of HC’s economic impact can be found in a 2000 KPMG report entitled Economic Impact of Harbourfront Centre.[36] The study, commissioned by HC, quantified the economic impacts of the activities of HC itself, and also those of other operators at the site (e.g. independent operators who provide services to the site and who are linked to the operation of HC). The most significant on-site independent operators described in the report included Queen’s Quay Terminal, parking lots of the Harbourfront site, marine operators, independent food and retail operators, and Pier 4 Restaurant and Museum.

The 2000 KPMG report identified economic impacts in the fiscal 1999 year in three categories: employment impacts, value-added-impacts (value created through the production of goods and services) and government revenues. The report found that HC on-site operating and capital expenditures of $68.8 million:

While this report delineates employment and value-added impacts of the HC site in considerable detail for the specified time periods, the authors fall short of placing the findings in a wider context, for example comparing these numbers to similar measures at the municipal or provincial levels.

The preceding analysis, bearing in mind that it is based on somewhat limited data, places the economic impact of HC and its activities in the context of the relevant municipal and provincial economies. However, the economic impact of HC and its attendant operators might also be viewed in the context of the development of the waterfront itself.

According to a 2009 impact analysis report found on its web site, the TWRC refers to the significant return on infrastructure investment that has already been realized over the last 10 years through activity supported by the TWRI and itself that has led to job creation and growth.[37]

Although this evaluation did not make an attempt to verify specific claims made by TWRC, based on the information collected, it is reasonable to conclude that activity in general on the Toronto waterfront has contributed to the local, provincial and the national economies. For the purposes of the present discussion, the connections between wider activity on the waterfront and activity in and around the HC site must be assessed. While it is difficult to make direct quantitative connections (as it is difficult to distinguish the impacts of other factors, such as increased population or increased tourism to Toronto), inferences can be made regarding the synergistic effects of having a world-class arts and culture organization situated directly on the waterfront. It seems likely that HC’s presence on the waterfront contributes to the desirability of the area in general for living and for recreational purposes and this in turn suggests the whole waterfront area would be more desirable for the kinds of development that comprise the TWRC’s main focus. This view of the connections between HC and its programming and the question of wider economic development on the waterfront in general is succinctly expressed in the 2000 KPMG report on economic impact of HC[38] (p. 32) where the authors state: Linking individual tourist attractions to tourist traffic is complex. Individuals may choose to visit a city because the city has many attractions, but not necessarily because the city has a particular attraction. The report goes on to say that there is little evidence that Harbourfront Centre is uniquely or solely responsible for generating significant tourist volumes by itself. The available evidence suggests that Harbourfront Centre is best thought of as one of a number of major attractions that together generate recreational tourism activity. In this role, Harbourfront Centre is a significant contributor to tourism in Toronto.

The arguments presented above indicate that HC, and the site operators associated with HC’s activities, have played, and continue to play, a significant role in the economic development of the Toronto waterfront. The HC has a long history on the waterfront land site, prior to TWRI development, and has indirectly contributed to this growth. By extension, the HCFP has also played a significant role in this development, since the HCFP is an important source of revenue for HC and has provided HC with a portion of its operational funding.

4.4.6 Assessment of Whether the HCFP Has Resulted in Any Unintended Outcomes 

Based on the analyses conducted in the other evaluation questions contained in this report, and based on the information gathered on this topic during interviews, it appears as though the HCFP has not produced any unintended results. A few of the interviewees mentioned the positive results that are attributable to HC, but these results are discussed in the assessments of the other evaluation questions.

4.5 Issue 5: Demonstration of Efficiency and Economy (Performance) 

4.5.1  Assessment of Whether HC Uses HCFP Funds Efficiently and Economically 

To begin the assessment of whether HCFP funds are used efficiently and for their intended purposes, we first examine the operational expense reporting requirements that are in place. The $4 million provided to HC by INFC in 2006-07 was conditional on receiving quarterly unaudited financial statements within 30 days following each quarter, and a final audited statement to be submitted by June 30, 2007 to provide confirmation that expenditures were in accordance with the funding agreement.[39]

The federal TRWI Secretariat has asked HC to report operational expenses using the expense categories and subcategories listed in Table 5. These categories and sub-categories are taken from the budget categories that appear in the quarterly cash flow forecast and record of expenditure statements that HC provides to the federal TWRI Secretariat on a quarterly basis.

Table 5
HC Operational Expense Categories, 2008-present
Operational Expense Categories and Subcategories
  • Salaries and Benefits
  • Site Operating Costs
    • Utilities
    • Theatre-Facility Common Expenses
    • Site/Building Maintenance
    • Site/Building Supplies
  • Sponsorship and Marketing
    • Advertising
    • Print Production
    • Sponsor Servicing
  • Administrative Costs
    • Insurance
    • Professional Fees
    • Information Technology Costs
    • Office Equipment
  • Capital Assets
    • Facilities
    • Equipment

Information provided by the federal TWRI Secretariat indicates that HC has been providing the federal TWRI Secretariat with quarterly reports on its operational expenses since the HCFP CA was signed in 2007. The initial reporting requirements were in line with what was called for under the HCFP CA.[40] The HCFP reporting regime was enhanced in 2008 to allow for additional information to be reflected, following the introduction of a new accounting software system at HC. In addition, interviews with HC managers confirmed that they have the capacity to provide detailed expenses between 2006 and 2008, using the current reporting categories. Federal TWRI Secretariat officials interviewed during this evaluation stated that the HC reports were sufficiently detailed to monitor how HCFP funds were used for eligible expenses. Based on this evidence, the federal TWRI Secretariat appears to have in place adequate expense verification controls and reporting mechanisms.[41]

Based on interviews with HC personnel, HC has in place the necessary mechanisms to carefully track its operational expenses. The organization undertakes annual board-approved budgeting activities. Estimates are generated for anticipated revenues and fixed expenses. These estimates become targets for each department, and directors receive monthly budget reports and are required to check their actual spending against budgeted amounts. Targets are fairly stringent and variances must be explained. They are also provided with historical financial data for comparison.

At the level of detailed spending, personnel stated that HC uses a purchase and cheque requisition system. Spending limits on purchasing are defined for various levels of signing authority. The organization also tenders out many of its purchases and seeks out the best value for money for goods and services. Spending is reported to the board of directors and variances must be discussed and explained. In addition to the quarterly reporting to the federal TWRI Secretariat, described above, HC personnel said in interviews that the federal TWRI Secretariat scrutinizes spending on a regular basis. This fact was confirmed by the federal TWRI Secretariat. Finally, HC interim financial statements are audited by external auditors on a quarterly basis, who also conduct year-end annual audits.

Interviews with the City of Toronto and with corporate and private sponsors suggest that HC is an efficient and lean organization. While this evaluation did not investigate this aspect of HC using an audit level of assurance, there is no evidence to indicate that HCFP funds are used inefficiently. Taken together, the information presented in the preceding paragraphs leads to the conclusion that HC uses HCFP funds efficiently and economically.

4.5.2  Assessment of Whether There are Any Alternative or More Cost-Effective Ways of Achieving the Desired Outcomes 

There was a view expressed by some interviewees that providing operational funding for a non-profit organization may be somewhat unusual for the federal government. A short list of alternative funding methods available to the federal government is listed in Appendix D.[42] All interviewees, however, agreed that the HCFP was the most fitting type of funding program for HC given the loss of parking revenue that occurred in 2004 and the federal government’s continued support of the organization since 1991. It should be noted, though, that the operational funding for HC provided by the federal government as a proportion of total funding for HC, has decreased over time. As discussed in section 4.4.2 of the report, information collected through interviews and the financial data suggests that federal funding is, in fact, having a positive effect on HC’s ability to generate revenues from other sources. These changes in HC’s funding context, and a lack of precedents found by the evaluation for the federal government providing operational funding support to a non-profit organization like HC on an ongoing basis should be noted when considering funding renewal. An important caveat is that given the recent global economic crisis, and its impact on the Canadian economy, the complete picture of the impact on the HC’s ability to generate revenue during that period and in the near future cannot be accurately assessed.

5.0 Conclusions 

5.1 Relevance

The evaluation found the HCFP to be a relevant program that is well-aligned with federal government priorities, roles and responsibilities.

HC itself was found to be an organization that is responsive to the needs of Canadians and to the artistic community. Its programming speaks to a wide variety of Canadians and visitors to Canada, and the innovative and varied nature of the programming satisfies the needs of those who are seeking relevant cultural expression, interesting artistic experiences and novel recreational opportunities. HC has processes in place to ensure that its offerings continue to reflect the needs and wants of the general public and of the artistic community.

The objectives of the HCFP were found to align with federal government priorities on a number of fronts. The underlying focus of the HCFP on contributing to the economic development of the Toronto waterfront parallels the intense focus that the Government of Canada has placed on economic development over the last several years. HC’s primary focus as an arts and culture organization, furthermore, coincides with the focus of many policies and programs supported by the federal government, mainly through the Department of Canadian Heritage.

HCFP dovetails with initiatives linked to the revitalization of the Toronto Waterfront, which were found to be well-aligned with the roles and responsibilities of the federal government.

5.2 Performance

The HCFP has succeeded to a large extent in achieving all of its expected outcomes, with one notable exception. Although HCFP has been successful in assisting HC in leveraging funds for programming it has not been as successful in leveraging operational funding from other sources, which would be required to achieve financial sustainability. HC still relies on federal funding to a significant extent to “keep the lights on.”

It is clear that HCFP has contributed significantly to HC’s operational stability. Currently, the HCFP accounts for about a third of the money HC needs to service its overhead. HC total revenue has increased substantially since 1992, and operating expenses have increased commensurately, remaining relatively stable as a percentage of total revenue. This reflects the costs associated with delivering expanded programming by HC. While the evaluation found that HC is increasingly capable of generating revenues, the organization is viewed as limited in where it can look for operational funding. The evaluation findings suggest reluctance among HC sponsors/donors to pay for overhead and operations. Base operational funding, including the funding provided through HCFP, was viewed as important to maintain the infrastructure needed to attract program support from sponsors and other sources, and to maintain existing levels of programming.

Federal funding appears to have played an important role in HC’s ability to leverage support from sponsors and the Toronto municipal government. However, much of this additional financial support has been targeted for programming, with the exception of funding from the City of Toronto. The City of Toronto is providing $750,000 per year in operational funding to HC over the 10 year period 2007-17, following the federal funding through HCFP announced in 2006. The perception among HC managers was that the potential to raise additional revenues for operating expenses through existing entrepreneurial activities has nearly been maximized. The evidence collected through the evaluation suggest that if federal funding were withdrawn immediately, HC’s financial viability would be impacted in the short term, through both the loss of significant operating revenue and potential loss of sponsorship revenues. In this scenario, HC would likely have to reduce the current level of programming it offers to the public or re-assess its cost recovery strategy. The evaluation found HC to be a well respected arts and culture organization, serving the broadest range of linguistic, cultural and racial interests. Educational and recreational opportunities were also found to be abundant, particularly due to the favourable characteristics of the HC site, including its proximity to Lake Ontario. HC not only offers culturally rich and diverse programming to the greater Toronto community, it is recognized as a world-class arts, culture and educational organization internationally.

HC has been found to be reasonably accessible to the general public. While the HC site is well served by public transportation, access by car was found to be somewhat more problematic, with the cost of parking and traffic congestion viewed as deterrents to more frequent visits to the site. Greater awareness among visitors that parking revenues from selected lots provide direct financial support to HC could potentially increase use of these lots. HC was found to be highly accessible to people with disabilities, cited as one of the best examples of access to cultural events and activities in Canada for people with disabilities.

The evaluation found that HC was associated with economic outcomes in three categories: employment impacts, value-added-impacts (value created through the production of goods and services) and government revenues; it is also reasonable to conclude that HC, and the site operators associated with HC’s activities, have played a role in the economic development of the Toronto waterfront. It is also reasonable to conclude that HC has played a significant role in the social and cultural development of the waterfront area and in Toronto in general.

The evaluation found no evidence to indicate that HC uses HCFP funds inefficiently. Evidence collected indicates that the federal TWRI Secretariat has in place adequate expense verification controls and reporting mechanisms, and that HC has in place the necessary mechanisms to carefully track operational its expenses.

The HCFP has been viewed as an efficient model of continuing support to the HC with positive effects seen in their increasing ability to generate funds from other sources and their decreasing level of reliance on federal funding since 1992 as a percentage of total revenue. It is not possible at this time and beyond the scope of this evaluation study to consider when HC may become weaned off reliance on the federal government for operational funding.

Options related to the management of the HCFP, if renewed, will have to be considered given that the federal TWRI Secretariat is scheduled to disband within a period of 3 years and there are no HCFP-dedicated FTEs. This may impact the potential future management of the HCFP as this file has been housed either with the federal Minister Responsible for Ontario or the Minister Responsible for the GTA. Given the potential renewal of the program, the management model of the program will have to be considered. In light of HC’s non-profit status and mandate as an arts and culture organization, a better fit may be found housing the program within another federal department.

6.0 Recommendations 

Recommendation 1: Harbourfront Centre (HC) at this time relies to a significant extent on federal funding for its operational expenses. A decision is required on an appropriate level and mechanism of federal funding to support operational costs of HC over the short term.

Recommendation 2: The federal government should request a plan from HC outlining its sustainability strategy over the next 2-3 years in the context of any renewed funding program. It should include a business plan for increasing revenues, sponsorships and private sector donations.

Appendix A  

HC Revenue and Expenses 1992 to 2009
Year Total Revenue
($M)
Total Federal Funding
($M)
Percentage of Total Revenue Provided by Federal Funding (%) Total Operational Expenses
($M)
Percentage of Operational Expenses Provided by Federal Funding (%) Total Operational Expenses as a Percentage of Total Revenue (%)
1992 16.77 8.8 52.5 8.85 99.4 53
1993 17.33 8.8 50.8 8.78 100.2 51
1994 16.2 8 49.4 8.05 99.4 50
1995 18.51 8.8 47.5 8.35 105 45
1996 17.55 7 39.9 8.06 87 46
1997 17.2 7 40.7 8.16 91 47
1998 17.76 4 22.5 8.36 46 47
1999 19.87 3.5 17.6 9.81 36 49
2000 19.33 3 15.5 10.62 28 55
2001 21.9 3 13.7 10.76 28 49
2002 24.5 4 16.3 12.45 32 51
2003 20.62 4 19.4 11.7 34 57
2004 22.72 4 17.6 12.12 33 53
2005 23.38 4 17.1 13.42 32 57
2006 24.42 5 20.4 13.56 36.8 55.5
2007 24.33 5 20.5 13.7 36 57
2008 28.14 5 17.8 14.07 36 50
2009 30.3 5 16.5 15.7 32 52

Appendix B  

HC Non-HCFP Revenue 1992 - 2009 ($M)
Year Corporate Sponsor-
ships
Event Admi-
ssions & Regis-
trations
Govern-
ment
Program-
ming
Grants
Parking,
Conce-
ssion
&
Other
Incomes
Facility Rentals Dona-
tions
in Kind
City
of
Toronto
Operating
Harbour-
front
Found-
ation
Amorti-
zation
of Defer-
red
Contri-
butions
Federal
Parking
Subsidy
Total
Non-HCFP Revenue
  ($M)
1992 2.65 1.66 1.28 1.76 0.62 0 0 0 0 0 7.97
1993 3.05 1.68 1.52 1.63 0.65 0 0 0 0 0 8.53
1994 2.25 1.72 1.58 1.98 0.68 0 0 0 0 0 8.21
1995 2.65 2.57 1.59 2 0.89 0 0 0 0 0 9.7
1996 2.82 2.52 2.03 2.4 0.78 0 0 0 0 0 10.55
1997 2.78 2.7 1.47 2.07 0.74 0 0 0 0.46 0 10.22
1998 2.99 3.81 1.09 2.12 0.76 0 0.99 1.55 0.46 0 13.77
1999 3.54 2.99 1.42 4.51 0.82 0 0.99 1.65 0.46 0 16.38
2000 2.64 2.43 1.45 5.98 0.83 0 0.75 1.8 0.46 0 16.34
2001 3.05 3.43 1.8 6.26 0.87 0 0.75 2.15 0.6 0 18.91
2002 2.98 3.57 2.29 5.93 0.84 1.7 0.75 1.6 0.83 0 20.49
2003 1.69 3.29 1.7 5.52 1.13 0.34 0.75 1.46 0.75 0 16.63
2004 2.72 3.15 2.55 5.67 1.41 0.31 0.75 1.4 0.76 0 18.72
2005 2.61 3.42 2.8 5.1 1.07 0.32 0.75 1.65 0.96 0.7 19.38
2006 2.43 3.31 2.3 4.78 1.11 1.5 0.75 1.4 1.14 0.7 19.42
2007 2.61 2.97 2.57 4.83 1.03 1.73 1.05 1.26 1.29 0 19.34
2008 5.52 3.26 2.31 4.88 1.08 1.64 1.45 1.35 1.64 0 23.13
2009 3.68 3.21 3.21 5.74 1.34 2.93 1.4 2 1.78 0 25.29

Appendix C - History of Federal support to Harbourfront Centre (HC) 

When the federal government transferred responsibility for cultural programming to HC in 1991, it continued to provide core financial support for that programming as well as site development and maintenance through contributions managed by the Queens Quay West Land Corporation, including a five-year funding package for HC that consisted of an annual operating subsidy of $4 million per year from 2001-02 until 2005-06. This funding package also authorized the provision of YQ4 parking revenues to HC for the period of 2001 to 2003. In May 2003, the federal government’s authority to continue to provide the indirect subsidy from YQ4 revenues to HC was extended until March 31, 2004.

Following the expiry of the authorization on March 31, 2004, HC no longer had access to the parking revenues from YQ4 and consequently, faced an operational shortfall. In February 2005, HC was provided $1.4 million in funding ($700,000 in each of 2004-05 and 2005-06) from the $500 million federal Toronto Waterfront Revitalization Initiative (TWRI)[43]

HC also received TWRI project funding as an Eligible Recipient through the Toronto Waterfront Revitalization Corporation[44] ((TWRC) to lead the Harbourfront Water’s Edge Improvements projects at John Quay and York Quay. The project work on these two Quays -- that form the bulk of HC’s site -- was carried out and completed between 2004 and 2006. In 2006-07, the government replaced the QQWLC funding with a five-year, $25 million package including $4 million from INFC in 2006‑07, and $21 million under the HCFP from 2006-07 to 2010-11.

In addition, the TWRC, with $25 million in federal TWRI funding, is replacing a 212-spot surface parking lot located on the harbourfront site with a 300-space underground parking garage (the Canada Square Parking Garage – CSPG ), which will be combined with development of a new urban park fronting Lake Ontario known as Canada Square. Current planning calls for the future development of an additional urban plaza on top of the parking facility as well as a cultural/retail village next to the plaza. Once the construction of the CSPG is completed in 2012, HC will retain and operate the facility which is expected to generate about $1.7 million in annual revenues. The Cultural Village to be developed on the surface area above the CSPG is expected to be the key revenue generating component on this site, given its prime location along the waterfront and the economic spin-offs generated by HC’s programming.

Appendix D - Alternative Models of Operational Funding by the federal government 

The HCFP model of providing only operational funding to a designated recipient (HC) is one means of helping a not-for-profit organization to cover its fixed costs and facilitate its ability to leverage funding while ensuring that “the lights stay on.”  However, the federal government has employed other models to promote waterfront development and to support the not-for-profit sector, especially in promoting arts and cultural activity.

In some instances, the federal government has chosen to establish federal Crown Corporations in Canada to deliver public policy when it feels that government departments, other levels of government or the private sector cannot adequately do so. For example, the Old Port of Montreal Corporation, whose mission is to “manage, develop and hold activities on a large urban site dedicated to recreation, tourism and culture,[45]” is a federal Crown Corporation that is a wholly-owned subsidiary of the CLC.

An example of a federal Crown Corporation whose mandate is exclusively related to the arts is the NAC in Ottawa.  According to its website,[46] “the NAC raises approximately 50% of its revenues from its own sources through the sales of tickets, parking and food as well as performance hall rentals and the fundraising of the National Arts Centre Foundation. The balance of the revenues derives from the federal government to operate and maintain the Centre.”

Another model created by the federal government is the establishment of an independent not-for-profit organization through which governments flow funds that go towards activities, such as the Canadian Institute for Health Information (CIHI). Under this model, the federal government provides funding for CIHI operations, in partnership with provincial and territorial governments, to allow the organization to carry out its mandate of being a leading source of data on Canada’s health care system and the health of Canadians to enable health leaders to make better-informed decisions.

Appendix E  

Management Response and Action Plan
Recommendation Management Response Planned Action Lead Target Date Comments
1. Harbourfront Centre (HC) at this time relies to a significant extent on federal funding for its operational expenses. A decision is required on an appropriate level and mechanism of federal funding to support operational costs of HC over the short term. The federal TWRI Secretariat agrees with this recommendation. We agree. The federal TWRI Secretariat is currently assessing a business case submitted by HC requesting the extension of the HCFP beyond March 2011. Federal TWRI Secretariat Q4 2010-11 N/A
2. The federal government should request a plan from HC outlining its sustainability strategy over the next 2-3 years in the context of any renewed funding program. It should include a business plan for increasing revenues, sponsorships and private sector donations. The federal TWRI Secretariat is not able to respond to this recommendation at this time, pending a funding decision. The federal TWRI Secretariat is not able to respond to this recommendation at this time, pending a funding decision. Federal TWRI Secretariat Q4 2010-11 N/A

 


1 Royal Commission on the Future of the Toronto Waterfront. August 1989.

2 City of Toronto Archives: http://www.toronto.ca/archives/index.htm

3 QQWLC was dissolved in 2006 having disposed of nearly all the properties it had held, except for the York Quay 4 (YQ4) Parking Garage at 200 Queen Street West, three waterfront slips and subsurface development rights for the York Quay 3 (YQ3) parking lot.

4 Based on financial data for HC presented in Appendix A of this report.

5 Harbourfront Centre Web site (http://www.harbourfrontcentre.com/whoweare/aboutus.cfm ) Accessed: January 27, 2010.

6 HC refers to the non-profit organization formed in 1991.

7 Examples of such activities include food and beverage sales and a sailing school.

8 In July 2010, the Minister of Finance approved the transfer of an additional $1.2 million in federal funding from the TWRI to the HCFP for 2010-11 to address the expected revenue shortfall resulting from the construction of the CSPG (i.e. due to the closure of the existing surface parking lot during the construction period.)

9 Since 2000, the federal TWRI Secretariat was initially located at Transport Canada until 2004 and subsequently housed at HRSDC (2004-05), Citizenship and Immigration Canada (2005-06), Treasury Board Secretariat (2006-07) and Environment Canada (2007-08), before being transferred to Finance Canada in 2008.

10 Harbourfront Centre Initiative, Contribution Agreement, between Minister of the Environment and Harbourfront Corporation (operating as Harbourfront Centre), signed January 29, 2007, p.4.

11 HCFP RMAF/RBAF, p.5.

12 Ibid, p. 4.

13 Environment Canada Web site: http://ec.gc.ca/doc/ae-ve/2008-09/638/toc_eng.htm.

14 Based on revenue figures for 2009. Over the period of the HCFP, its contribution to total HC revenues has ranged from 16.5 to 20.5%.

15Speech from the Throne November 19, 2008 - http://www.speech.gc.ca/eng/media.asp?id=1383.

16 Speech from the Throne January 26, 2009 - http://www.speech.gc.ca/eng/media.asp?id=1384.

17 Speech from the Throne March 3, 2010 - http://www.speech.gc.ca/eng/media.asp?id=1388.

18 Canada’s Economic Action Plan. March 2009, www.actionplan.gc.ca.

19 http://www.oldportcorporation.com/home.html.

20 http://www.theforks.com.

21 http://www.pch.gc.ca/eng/1268609659093.

22 Ibid, p.2. This Supplementary Table provides the details for all Transfer Payment Programs funded by Canadian Heritage.

23 Ibid, p. 4. In 2009-2010 Canada’s Economic Action Plan provided 27 funded organizations with an additional $5.95 million in stimulus support, allowing them to strengthen their administrative capacity to continue to provide professional training of the highest calibre.

24 HCFP RMAF/RBAF, p4.

25 Including approximately $1.35 million in net revenue for 2009-10 from the YQ3 lot that is now closed to construct the Canada Square project.

26 HCFP RMAF/RBAF, p4

27 Based on data for 2009, presented in Appendix A.

28 A Strategic Plan for Ensuring Access for Linguistic, Cultural and Racial Groups at Harbourfront Centre. Harbourfront Centre, Toronto. 1992.

29 Promises and Possibilities Report Card on ”Opening Up” Harbourfront Centre’s Access Plan for Linguistic, Cultural and Racial Diversity. 2004.

30 Strategic Access Plan for Linguistic, Cultural and Racial Diversity. 2004.

31 Harbourfront Centre: A presentation to senior management of research surveys of visitors and prospective visitors. 2004. EKOS.

32 In January 2004, William J.S. Boyle, the HC Chief Executive Officer, was named a Member of the Order of Canada in recognition of his work to champion Canadian and international culture both at home and abroad.

33 Harbourfront Centre Visitor Survey. Harbourfront Centre, 2006.

34 Ibid.

35 Self Accessibility Audit of the YQC 2010.

36 Economic Impact of Harbourfront Centre - Final Report. 2000. KPMG.

37 http://www.waterfrontoronto.ca/our_waterfront_vision/economic_growth/realizing_roi_now -- Summarizing Waterfront Toronto Economic Impact Analysis – Phase 1: 2001-2009. June 12, 2009, by UrbanMetrics Inc. The TWRC is now referred to Waterfront Toronto (WT) in its public communications, though its name for legal purposes remains unchanged.

38 Economic Impact of Harbourfront Centre - Final Report. 2000. KPMG.

39 Contribution Agreement between Minister of Transport, Infrastructure and Communities and Harbourfront Corporation (operating as Harbourfront Centre), signed June 26, 2006, Section 9.1 et seq.

40 HCFP CA, Section 5 and Schedules B and D.

41 To supplement the financial and progress quarterly payment reporting it receives from HC, the federal TWRI Secretariat has developed and implemented 3 HCFP Risk-based Monitoring and Audit Plans (2008-09, 2009-10 and 2010-11) to put into practice the elements it committed to in the program’s integrated RMAF/RBAF. Each plan called for an annual desk audit entailing a sampling of financial data to ensure that the funding provided has been spent for its intended purpose, and a site visit to determine whether existing procedures and approaches have been adequate to mitigate program risks, if any. In each instance, the invoices selected as part of the audit exercise were thoroughly reviewed and found to be compliant with the CA terms and conditions and funds were properly accounted for. In addition, as per each Monitoring and Audit Plan, the federal TWRI Secretariat has also held quarterly telephone calls or meetings with HC management and staff.

42 The evaluation scanned only a few models available to the federal government when funding operational expenses of organizations (See Appendix D). A complete environment scan of such models is beyond the scope of this evaluation. Grants and contributions were earlier explained in relation to the program funding HC receives from departments such as the Department of Heritage Canada.

43 On October 20, 2000, the Government of Canada, the Province of Ontario, and the City of Toronto each announced a commitment of $500 million to fund the Toronto Waterfront Revitalization Initiative (TWRI) for a total of $1.5 billion. The TWRI is both an infrastructure and urban renewal investment that involves an area of approximately 400 hectares of underutilized and underdeveloped prime real estate along Toronto’s waterfront, an area surrounding the parcel of land managed by HC Federal participation in the TWRI is manifest through a contribution program, which is managed by the federal TWRI Secretariat, presently housed at the Department of Finance.

44 In 2002, the three levels of government established the Toronto Waterfront Revitalization Corporation (TWRC) to oversee the revitalization efforts under the TWRI. The TWRC, mandated with the planning and implementation of the TWRI, is funded through contribution agreements. The TWRC is now referred to Waterfront Toronto (WT) in its public communications, though its name for legal purposes remains unchanged.

45 http://www.oldportcorporation.com/home.html. The Old Port of Montreal is comprised of 40.7 hectares, more than ten times the size of the 4 hectare (10 acre) parcel for which HC is responsible.

46 http://www.nac-cna.ca/en/about/nacfacts/index.cfm.