Citizens concerned about the process and the selection of the Connaught should direct their energies and efforts toward the provincial government.
By Ryan McGreal
Published September 21, 2009
Last week, Council voted to approve six projects to recommend to the Ontario Ministry of Municipal Affairs and Housing (MMAH) for consideration under the Canada-Ontario Affordable Housing Program Extension, a partnership between the federal and provincial government to create and repair affordable housing units across Ontario.
The six projects are:
The first recommendation, a mixed income development in the derelict Royal Connaught Hotel that would build 100 subsidized rent units and 106 market-rate rent units, has drawn intense controversy.
The city claims that the development will spur revitalization of the downtown core, but opponents argue that another development for low-income residents in an area that already has a lot of low-income housing will only serve to ghettoize the poor without bringing economic diversity to the core.
Also at issue is the process by which this property was selected. Last May, the city issued a Request for Proposals (RFP) for proposals under this program. A team of city staff evaluated the proposals with representatives from the Housing Division, Development Planning Division, Downtown Renewal Division and Financial Services Division.
The proposals were evaluated according to two sets of criteria: technical merits and cost effectiveness. Under the technical merits evaluation, submissions were assessed according to the following weighted criteria:
|Strength and Background of the Bidder||30%|
|Site Characteristics and Developer Concept||20%|
|Location within the city of Hamilton||20%|
The Connaught proposal received the highest rating under these criteria.
In the days leading up to and after the Council vote on these proposals, new information came to light that bears significantly on the Grand Connaught consortium's "strength and background":
The property owners were in arrears some $500,000 on their property tax over a period spanning three years. Consortium representative Tony Battaglia said it was "embarrassing" when the Hamilton Spectator reported this shortly before the Council meeting.
Worse, Battaglia offered to pay the tax arrears in full on the day that Council voted, creating an awkward perception about the role of the payment in persuading Council to support the bid.
One member of the consortium, Ted Valeri, has a pending lawsuit against the city related to a failed property development dating back to 2003.
However, city staff do not appear to have given consideration to these facts when they were evaluating the proposals. This casts serious question on the soundness and validity of the evaluation process.
At the September 16, 2009 Council meeting in which the proposals were presented for voting, Council voted instead to defer the decision after Councillor Bob Bratina stated that legal issues had come to his attention that needed addressing.
Unfortunately, they agreed to defer the decision to a special meeting later that same night which they conducted in camera. At 11:45 PM they emerged from the second meeting and stated that they voted 10-6 (with Bratina abstaining) to support all six proposals.
In favour: Eisenberger, Collins, Duvall, Jackson, McCarthy, McHattie, Merulla, Morelli, Pearson, Powers, Whitehead.
Opposed: Clark, Ferguson, Pasuta, Mitchell
Most councillors voted to approve all six proposals because they were worried that singling out the Connaught proposal would result in legal liability for politicizing the RFP process, and putting the brakes on all six proposals would result in missing the provincial deadline for submissions.
Councillor Sam Merulla claimed, "This was a bureaucratic decision with no political interference until now," but as Mary Louise Piggott pointed out later, the process was already politicized when staff decided to ignore the tax arrears and lawsuit and give the Connaught proposal top marks.
As Councillor Bob Bratina later posted in a comment on Raise the Hammer, "What is Council's role if, as we are told, the projects must be approved or rejected as a group, and in the order of the staff rating? Why then is this not simply sent directly to the Province without Council direction?"
Another problem with the Connaught proposal is the cost structure. Under the submitted proposal, the province would contribute $12.9 million toward the Connaught project, with the city contributing another $5.7 million in "Development Charge relief and property tax savings through the 'New Multi-Residential' tax class and relief from Parkland Dedication charges."
That works out to $18.6 million of the total $27 million cost, or two-thirds, to provide slightly less than half the units at 20 percent below market rates.
$18.6 million for 100 units works out to $186,000 per unit. At current downtown property values, that money could be used to buy a hundred four-bedroom houses and give them to people. Alternately, the $18.6 million could provide a 20 percent discount on the purchase price of approximately 500 homes.
This does not seem like good value for the money spent, and it seems to suggest that at least some of the money earmarked for providing affordable housing will actually apply to the market-priced component of the development.
Unfortunately, Council decided to rush ahead and vote for the proposal despite all of these problems. Now the bundle of projects will go to the Ontario Ministry of Municipal Affairs and Housing (MMAH) for consideration.
At this point, citizens concerned about the process and the selection of the Connaught should direct their energies and efforts toward the provincial government:
|Hon. Jim Watson, MPP||Minister, Municipal Affairs and Housingfirstname.lastname@example.org|
|Sophia Aggelonitis, MPP||Hamilton Mountainemail@example.com|
|Ted McMeekin, MPP||Ancaster Dundas Flamborough Westdalefirstname.lastname@example.org|
The deadline for municipal submissions to the MMAH is September 30, 2009, and the final approval for funding under the COAHP rests with the MMAH.
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