Capital Investments – Improving Ontario's Schools

Ontario Regulation 444/98, Disposition of Surplus Real Property

There are currently 72 school boards across Ontario, which are grouped into four categories: English Public, English Catholic, French Public and French Catholic. These school boards hold between eight to 600-plus properties, and they operate 5,000 school facilities in total. School board facilities represent the government's largest investment in building infrastructure. Overall, Ontario schools cover 267 million square feet and are valued at about $55 billion.

School Board Disposition Process

When schools are closed, school boards can declare these properties surplus to the board's needs. Once that has been declared, school boards can offer these properties for sale or lease.

In doing so, school boards are required to follow the requirements set out in Ontario Regulation 444/98 - Disposition of Surplus Real Property (O. Reg. 444/98).

Under this regulation, school boards are required to first offer surplus property for purchase or lease to a list of preferred organizations. This has to happen before the property can be sold or leased on the open market, and helps to facilitate the property remaining within the public sphere where there is a need and a financially viable proposal. When school boards choose to sell or lease a surplus property, they will provide notification to the preferred organizations in the jurisdiction in which the surplus property is located.

Amendments to Ontario Regulation 444/98

On May 5, 2016, O. Reg. 444/98 was amended by the Ministry of Education to respond to recommendations made in the report Community Hubs in Ontario: A Strategic Framework and Action Plan. The amendments are intended to improve opportunities for public organizations to participate in the process that school boards undertake when selling or leasing surplus schools.

The ministry's two key amendments result in an expansion to circulation timelines and an expansion of eligible public organizations.

These amendments will come into effect on September 1, 2016.

1. Extension of Circulation Timelines

Organizations receiving notification of surplus property sale or lease will have 90 days to submit an expression of interest, following which organizations that submitted an expression of interest will have an additional 90 days to submit an offer.

Expressions of interest must be in writing and signed by a person representing the entity with the appropriate authority to do so. In addition, expressions of interest must include the property description and the name of the organization(s) expressing interest, as well as the name of any referring organization.

Certain organizations listed in the regulation have the opportunity to refer notifications of surplus property disposition to organizations within their purview. In particular, this applies to District Social Services Administration Boards/Consolidated Municipal Service Managers, children's mental health lead agencies, Local Health Integration Networks, and First Nation and Métis Organizations. If two or more of the same type of organization make offers, their priority may be determined by the listed organization that referred the notification. If the referring organization does not identify the priority of offers from its member organizations in cases where two or more offers are submitted, the member organization that offers the highest price has priority.

O. Reg. 444/98 does not stipulate the contents of an offer; however it is common and best practice for the disposing board and the interested organization to commission their own appraisals in order to determine the fair market value of the surplus property.

2. Expansion of List of Public Organization:

This amendment expands and reprioritizes the current list of public organizations to receive notification of surplus school board property sale or lease. School boards will now be required to circulate surplus school properties that they want to lease or sell to six additional groups of public entities.

Starting September 1, 2016, boards will be required to circulate notification of surplus property sale or lease simultaneously to the following prioritized list of public organization before the property can be sold or leased on the open market.

New public entities that are being added to the circulation list are italicized below.

  1. Coterminous school boards
  2. Agencies accommodating Section 23 programming
  3. District Social Services Administration Boards (DSSABs) or Consolidated Municipal Service Managers (CMSMs)
  4. Public colleges
  5. Public universities
  6. Children's mental health lead agencies
  7. Local Health Integration Networks (LHINs)
  8. Public health boards
  9. Provincial government (The Crown in Right of Ontario)
  10. Lower-tier municipalities
  11. Upper-tier municipalities
  12. Local service boards
  13. First Nation and Métis Organizations
  14. Federal government (The Crown in Right of Ontario)

For additional information, please consult the amended O. Reg. 444/98, using the following link: www.ontario.ca/laws.

School boards can use the Property Circulation Address Look-up Function for GIS to identify most of the entities to which notice of surplus school property disposition should be circulated under O. Reg. 444/98. School board users will need GO Secure Integration for GIS, as well as a supported browser, to access and use the property circulation address look-up function.