Today, February 7, 2013 marks the second anniversary of the day Penny Ballem, Vancouver’s City Manager, released a $1 billion claim against Millennium in the form of a mortgage placed on several of the firm’s properties. No public statement was made on this matter at the time. In fact, it all happened very quickly and quietly. No one might have noticed the claim even existed had the agreement concerning the $1 billion mortgage not been recorded at the Land Titles Office.
Investigative reporter Bob Mackin first covered the story in City forgoes billion-dollar Millennium mortgage in the Vancouver Courier. Mackin provided further details on his blog in the article Three years later, more questions than answers. We’ve made available PDFs of the $1 billion mortgage and the mortgage release documents, and we have covered the story in previous articles: Billion dollar boondoggle and Release of $1 billion Millennium mortgage by City Manager paves way for STIR/condo tower construction, HSBC financing.
While some may claim that the City of Vancouver would not have been able to recover any more money from Millennium after the Olympic Village fiasco, is this really the case? The fact that Millennium was able to launch into the Boheme Living project on East Hastings appears to contradict this line of reasoning. Boheme Living is being developed by Millennium, located diagonally across the road from the Waldorf Hotel.
At a time the City lacks adequate funding for Community Centres under the Park Board, and for Social Housing, people should be concerned about the lack of transparency on how the City Hall allocates its budget. (For example, see CityHallWatch writes Mayor, Council on 2013 City budget $1 billion, more transparency needed.)
How much has the entire Olympic Village cost the taxpayers of Vancouver? Dr. Ballem gave an update on April 8, 2011 that showed several properties had been seized from Millennium. But the public still knows too little about the current financial status of the books on Olympic Village.
Should there be a full audit of Olympic Village finances? Are we ever expected to get one? Will anyone ever be held accountable? Could this be a job for the new provincially appointed auditor general of local government?
People have a right to have a lot of questions. Is the financial mess left by Olympic Village one of the reasons behind the City’s recent moves by the majority block of Commissioners on the Park Board to change the framework used to run Community Centres? Will the City, hence taxpayers, end up holding the bag for potentially tens of millions of dollars worth of losses? Did our elected officials at City Council actually vote on record to give Penny Ballem the authority to sign away the $1billion mortgage owed to the City? Was there any (or adequate) discussion of these things in Council?
We encourage readers to contact your elected officials and ask questions. Also, please contact your favourite reporter or media outlook and encourage them to investigate these matters and help improve the public accountability of our local government. If they don’t report on things as important as these, ask why. Perhaps some of the spotlight should go to Councillor Raymond Louie, the chair of the city’s Finance Committee. Maybe he can answer the questions.
Perhaps the full picture will be unknown until all units in Olympic Village have been sold, and when seized properties have been liquidated. Meanwhile, the credit rating of the City of Vancouver was downgraded recently, a factor that will lead to higher borrowing costs. Who pays for all these things? We, the taxpayers.
As Rennie Marketing systems tries to sell the remaining stock of unsold units at Olympic Village, City Council has been busy, generously granting rezonings all around Southeast False Creek. Onni was granted approval on the rezoning of a nearby property on October 16, 2012 to increase the building density and the number of units from 150 to 231. The large 488 unit rezoning at 105-167 West 2nd Avenue was passed in July 2011. Construction is proceeding on 4 towers by Wall Financial along 1st Avenue, and nearby there are other projects by Pinnacle on 2nd Avenue. Other towers are also under construction to the south of Terminal Avenue, between Quebec Street and 1st Avenue (see photos). All of these additional units compete in pre-sales with the unsold stock at Olympic Village, potentially exacerbating the City’s (i.e., the public’s) losses. Our elected officials and public servants are bound by a formal Code of Conduct to put the public interest first. But when you look at what the public can see through the smoke and mirrors, the picture doesn’t look so good. Who is benefiting, and who is paying the price of all these deals? And who is looking after the public interest?