Toronto Pearson International Airport

[Filip]

It's mainly a mix of lofty proclaimations, glorious statistics, human interest stories and hint of future directions with no details. Guess we will have to wait for the Master Plan update. The AR is disappointingly useless for informing that.

AoD

Do we even know if they're working on a new masterplan? Usually they have lengthy community consultations on this and I haven't had it cross my radar yet.

I attended the meetings in 2007 to shape the current, and grossly outdated masterplan.

 

[AlvinofDiaspar]

Do we even know if they're working on a new masterplan? Usually they have lengthy community consultations on this and I haven't had it cross my radar yet.

I attended the meetings in 2007 to shape the current, and grossly outdated masterplan.

I think there is a TC requirement to submit a master plan every decade as a condition of the lease to the Airport Authority:

Obligations to Transport Canada and monitoring
Like other local airport authorities, ADM has a long-term lease with Transport Canada that sets out its obligations and certain aspects of its operations. In addition to meeting applicable regulations, ADM is required to pay rent to Transport Canada, which is a percentage of the Corporation’s gross revenues. Every year, ADM also has to invest to keep its facilities in good order and develop them based on the needs of customers, passengers and airlines, as well as the Montréal community.

The Government of Canada plays an active role as owner-lessor. Under the monitoring program of airport leases, Transport Canada closely regulates ADM and continuously reviews its activities. Every year, ADM is subject to a comprehensive audit (lease- monitoring report) regarding its compliance with its lease obligations.

Every five years, ADM’s performance is also subject to a review by an independent accounting firm that reports directly to Transport Canada. In addition, every 10 years, ADM has to submit to Transport Canada a master plan describing proposed development of its airports over a period of 20 years. Any changes to land use have to obtain prior approval from Transport Canada.

http://www.admtl.com/en/adm/company/governance-transparency

AoD

 

[Woodbridge_Heights]

I feel like sonic the hedgehog waiting for a new master plan

 

[rbt]

2016 Annual Report is out:

https://torontopearson.com/ar2016/downloads/GTAA-2016-Annual-Report.pdf

Was hoping they'd include something tangible around gate expansion projects but:

I assume they're planning something as it looks like they've got half a billion in cash and the last couple years they've been putting quite a bit against existing debt too. A decade ago, instead of paying down debt, they would have been trimming prices.

As you say, they've done nothing to indicate what their plans are, but it appears there is something planned.

 

[kEiThZ]

Could they pay for the hub themselves?

 

[animatronic]

If your travels have taken you through Toronto's Lester B. Pearson Airport in recent weeks, you may have been impacted by the major construction project currently being undertaken at Canada's busiest airport. At Air Canada, we have a responsibility to ensure your trip is safe, comfortable and on time, so when your plans are disrupted, we strive to take care of you and keep you informed along the way.

The Greater Toronto Airports Authority, the airport authority that oversees Pearson, is managing a major construction project to overhaul the busiest runway and its associated taxiways. The project started March 28 and is scheduled to be completed May 16, 2017. The positive news is that it is on schedule. The bad news is that the work is much more disruptive than anticipated, and recent weather conditions have only added to that difficulty. The customer experience travelling through Toronto during this time has been unpredictable at best, and downright frustrating at worst, due to extensive flight delays and a disproportionately large number of cancellations.

We are extremely sympathetic to the disruption this project is causing you. When the project is completed, it will be a big step forward. Right now, however, we want you to know that we understand the inconveniences – both big and small – that you are experiencing. We also want you to know we are doing our best to manage through this and want to help you in any way we can. While we are not managing the construction project, we will be doing everything within our power to help you get through the next few weeks with the least disruption.

Before departing for the airport, please check to ensure your flight is on time. When you arrive at the airport, please check in with us and let us know how we can help. Please see for the latest updates on the runway construction.

Best regards,

Benjamin Smith
President, Passenger Airlines
Air Canada

 

[narduch]

I got this email today too.

Its funny that they are sending this now, as I got fucked over by this back in early April and spent over 3 hours on the tarmac in Montreal.

 

[allabootmatt]

Could they pay for the hub themselves?

If I'm not mistaken, the previous round of expansion was accomplished without the use of public money. GTAA issued bonds on its own, and managed to pay for a new terminal and significant runway improvements on that basis. A busy international airport is a formidable revenue generator (which is why Canadian pension funds have invested in so many overseas), and you can borrow a lot of money with the underpinning of that cash.

That said, I'm not sure how the twin obligations of paying down the legacy debt and continuing to pay "ground rent" to the federal government leave the GTAA's current financial position.

 

[rbt]

Could they pay for the hub themselves?

Financially? Yes, for the terminal building/UPX connection/BUS terminal and pedestrian bridge/tunnels to the terminal. They've got a minimum of $2B borrowing space. That HSR/RER track under Airport Road is probably beyond their financial capacity.

Their bylaws probably make it impossible without shareholder approval (federal government) changing them.

Also, if they do all that work themselves, they may not have the immediate financial capacity to add Pier G/H/... Perhaps they don't need a new Pier immediately if the basic transit terminal work goes quickly and they can ditch the old parking/roads for new gates on the north side of T1/T3.

 

[junctionist]

They should build a new Terminal 2. It's odd that there's a Terminal 1 and a Terminal 3 but no Terminal 2.

 

[allabootmatt]

It's weird but not uncommon. Heathrow currently has no Terminal 1, but 2-3-4-5.

Given that ultimately 1 and 3 will probably merge into one huge structure, sequential numbering is hardly a major concern.

 

[TOareaFan]

Their bylaws probably make it impossible without shareholder approval (federal government) changing them.

I don't think this is accurate....since they have no share capital they can't have shareholders.....I think they are a non profit corporation directed by a board.

Their corporate governance is difficult to understand (and that may be by design) but I believe the board consists of:

• 5 people directly nominated by its "members" (York, Durham, Peel, Halton and Toronto)
• then a bunch (7) that the 5 members pick together from a pool of identfied candidates
• 2 nominees by the Feds
• 1 nominee by the Province

It is hard to see how the Feds have any operational control over them.

It is an intriguing structure that I have never ever really understood.....a guy I used to know quite well is now a board member....I think i will arrange a lunch and pick his brain over it....just for interest.

 

[rbt]

I don't think this is accurate....since they have no share capital they can't have shareholders.....I think they are a non profit corporation directed by a board.

Indeed. I did a bit of digging; they were originally formed as a corporation in '93 (no shares but had direct federal oversight; in effect the feds directly controlled the bylaws) and transitioned to a straight not-for-profit in 2014.

Their mandate (or bylaws) comes from the board now rather than any kind of legislative direction like a crown corp receives. Federal crown corp mandates are usually pretty vague but I know GTAA had issues with funding any part of UPX in the past due to it. CBCs is essentially: actively contribute to the flow and exchange of cultural expression, in English and French, across Canada).

So, if the GTAA board and the airlines are happy that train station+track helps the airport then there really isn't an obstruction to it. The sole challenge will be paying down debt on the train project via fees, probably a train ticket surcharge of some kind for using that station.

 

[DSCToronto]

This is on the GTAA website ( https://torontopearson.com/en/gtaa/board-of-directors/# )

Board of Directors
As a corporation without share capital, instead of shareholders, the GTAA has members who are also its directors.

The GTAA is governed by a 15-member board of directors. Directors typically serve a term of three years and are eligible for reelection to a maximum of nine years. The directors are elected by the existing members of the board.

Community members are typically identified through a search process including recommendations from Named Community Members:

• The Board of Trade of the City of Brampton
• The Board of Trade of the City of Mississauga
• The Toronto Board of Trade
• The Law Society of Upper Canada
• Professional Engineers Ontario
• Institute of Chartered Accountants of Ontario

Five directors are municipal members. Municipal members are identified from the following municipalities served by Toronto Pearson:

• York
• Halton
• Peel
• Durham
• City of Toronto

Each municipality is entitled to provide the names of up to three candidates on a rotating basis. The board then selects one of the three candidates for the available director position.

The Government of Canada is also entitled to appoint two members, and the Province of Ontario, one member.

This is on the City website:

http://www1.toronto.ca/wps/portal/c...nnel=3426ea64460b3410VgnVCM10000071d60f89RCRD

Greater Toronto Airports Authority Board

The Greater Toronto Airports Authority (GTAA) was incorporated in 1993 under Part II of the Canada Corporations Act as a corporation without share capital. The mandate of the GTAA is to operate and develop a regional network of airports in the Greater Toronto Area.

In 1996, the GTAA assumed the operation, management and control of Pearson International Airport through a ground lease arrangement with Transport Canada, in accordance with the National Airports Policy. The GTAA has the authority to operate the airport on a commercial basis and to set airline rates and charges. The federal government retains regulatory control over the aviation industry.

The General Operating Bylaw of the GTAA sets out the requirements for members of the board of directors. Under the bylaw, the City of Toronto is invited to submit three nominees from whom the GTAA Board may appoint one person to serve on the board as the City's nominee. If the GTAA Board determines that the City's proposed nominees are ineligible or do not meet the requirements of the board, the GTAA Board may select another appointee who is not nominated by the City.

The current Toronto member is:

David Wilson, Chairman of the Board
David is the former Chair and CEO of the Ontario Securities Commission, and is now retired following an extensive career in Canada’s financial services industry. Prior to his appointment to the Ontario Securities Commission, David was Vice Chair of the Bank of Nova Scotia and Chair and Chief Executive Officer of Scotia Capital.
Municipal Member (City of Toronto)

 

[nfitz]

They should build a new Terminal 2. It's odd that there's a Terminal 1 and a Terminal 3 but no Terminal 2.

Where? The proposed new gates for Terminal 1 are going where Terminal 2 used to be. Given the move towards larger connected terminals everywhere, I don't see the need for any numbers unless they build one on Courtneypark Drive or Derry - in the same manner they've built T4 and T5 at Heathrow, or the two terminal at Mumbai.