The man-made native habitat island, one of many remarkable details of the SEFC development
While the Olympic Village story gets milked for political gain, job one remains getting it built
In less than 12 months, members of the Jamaican Bobsled Team are going to be moving into brand new accommodations at Southeast False Creek (SEFC), looking for a place to put their gloves and goggles. If that does not light a fire under everyone trying to get the Olympic Village built, I'm not sure what will.
Vancouverites have to be grateful for having insightful media looking at this story. The reporters know they are being spun by the Mayor's staff. They, like many of the public, also know the numbers are being manipulated for headlines. As veteran City Hall watcher Frances Bula states, everyone PLEASE REMAIN CALM.
We here at CityCaucus.com won't even begin to comment on the nature of the real estate deal behind the SEFC. Even with floors full of researchers here at CityCaucus Towers cranked up on Red Bull and Jolt Cola, we can't figure this one out yet.
We do know one thing, however. EVERYONE from across the entire political spectrum in provincial and city politics has had a hand in supporting this project, flaws and all.
NDP, BC Liberals, NPA, COPE and the governing Vision Vancouver party, alongside City staff and numerous consultants with experience in the private sector, supported decisions over the past decade to make SEFC a model community and a showcase for the world.
By wagging his finger at the previous council and accusing them of dealing in bad faith on behalf of Vancouver taxpayers, Mayor Robertson is playing an old political game called blame the other guy. As we pointed out on Friday, senior members of his own caucus supported key decisions in unanimous Council votes that have resulted in the risky situation Vancouver now faces.
Now add in the fact the Mayor's Office is providing a few 'private' Olympic Village briefings to their favourite columnists, and presto, you get banner headlines about how taxpayers are going to be on the hook for a billion dollars.
There are few media in Vancouver who know the story of SEFC better than Frances Bula. Here is what she had to say about the "bombshell" news conference held by Mayor Robertson on Friday.
The other, and this was the news that came out today, was providing a completion guarantee, i.e. the city guaranteed that if Millennium failed, it would find a way to finish building the project. That completion guarantee stipulated that the project had to be finished according to the original designs.
We agree with Frances that the only "news" that came out on Friday related the fact that there was a completion guarantee. But was it really news?
We looked back at the City of Vancouver's 2007 financial statement (thanks to our crack research team for finding this) including the auditor's report provided by KPMG, published on the city's website in April last year, and found the following statement on page 33 of the document (emphasis ours):
"In order to facilitate the completion of the Market Project in time for the 2010 Winter Games, the City (as landlord under the ground lease portion of the Agreement) has provided security to the Market Project lender for complete construction financing (the "Loan") that is in addition to the security provided by Millennium. The City has: provided a Completion Guarantee which obligates it to complete the Market Project in time for the 2010 Winter Games should Millennium be unable to complete; has subordinated the balance of the Purchase Price (approximately $170.0 million); and, has provided a Payment Guarantee of up to $190.0 million (plus interest and expenses) should Millennium be unable to fulfill its obligations to the Market Project Lender. The City's obligations and rights associated with this security extend until the Loan is repaid.
"As the City's guarantees are in addition to those provided by Millennium, the exposure of the City is primarily dependent on the extent to which the marketing of the Market Project is successful prior to the due date of the Loan. In the case of a default, it is expected that the City will assume the completion of the Market Project and become responsible for repaying the Loan. The City's exposure in these circumstances is secured by guarantees and other rights provided to the City by Millennium including corporate and personal guarantees and the transfer of all interests in the Market Project."
So there you have it, folks. This entire "blunder" was a mouse click away for the past eight months, not hidden away in a vault as the Mayor would like to characterize it.
Rather than spending countless hours planning PR strategies with high profile communications strategists as we first reported here earlier, the Mayor should be working tirelessly to restore confidence in this project. As for the Mayor's staff, a few less private briefings for 'select' media, and more time working with the developer and City officials will go a long way to protecting taxpayers interests.
We have further questions regarding the Mayor's public relations on the Olympic Village story:
- Who paid for Hoggan & Associates to help craft Robertson's political spin on this story? If it was paid for out of the Mayor's office that's fine. If the City of Vancouver picked up Hoggan's tab then the politicization of City Hall continues apace.
- Why weren't the media allowed to reveal who provided the confidential "technical briefing" at City Hall Friday afternoon? We know it was new City Manager Penny Ballem. Her name was even left on the PowerPoint she loaned to the Vancouver Sun. How many times will this government contradict their promise of openness and transparency?
- Why the whitewash of any involvement of the 2003-2005 Vision/COPE Council in their carefully crafted "timeline" of the project provided by the City Manager? It's well-known that Council made significant decisions that added to the overall costs of the project, including making two-thirds of the housing subsidized by taxpayers. By the way, the PDF properties indicate it was produced by the City's Corporate Communications department headed by the spouse of a Mayor's office apparatchik.
Respected developer Michael Geller, who gained the favour of many Vision Vancouver supporters in his run for Council this fall sums up well what is needed from the Mayor in this comment on CityCaucus.com:
I hope that we will all be assured that the municipal election is finally over, and there will be sound leadership at city hall that is in the best interest of all citizens. I feel that Vancouver's national and international reputation took an unfair beating on Friday and over the weekend, and we must now try to remedy this.
We agree. On this file at least, it's time to shelve the partisan politics until the Games are concluded. Vancouver MUST complete this project on time, and ensure that when the world arrives in 12 months we have something the whole region can all be proud of. So to Mayor Robertson and Councillor Meggs we say, save the politicking for the 2011 election.