Council receives a study on the existing Haist Street arena from the Institute of Environmental Research, Inc. It concludes that the arena is sufficient for the Town at the time, and will remain so beyond the scope of the Council’s Master Plan. (A plan that extended until the Town reached 16,600 residents.)
A decision of the Ontario Municipal Board adds over 400 acres to Pelham’s Urban Area, acres that are to become “East Fonthill.”
dmA Planning and Management Services reports to Council that the Town “should provide an additional ice surface in the period of the plan,” and that “additional ice should be provided in Pelham with a twin-pad arena in a multi-use complex…the existing arena should be closed and consideration given to relocation outdoor facilities and disposing of the property.”
The report also said that “these facilities should only be provided if users are prepared to pay for their use.”
According to former Councillor Brian Walker, who sat on Council for 25 years, there was little discussion on Council in the 1990s about replacing the arena. Walker says that at the time, the arena—which was built in 1975—was in “pretty good shape.” Walker, who left office in 2003, says that upon arrival of the new Council in 2003, “it became obvious that a community centre was their priority. The arena then entered a period of benign neglect, ending in claims that it was in terrible shape and we needed a new centre.”
Under Mayor Ron Leavens, Council in January moves to purchase 32 acres at the corner of Rice Road and Highway 20 for just over $3.5 million, working out to about $110,000 per acre. Leavens says that Council decided this purchase was necessary because the impending Green Belt declaration was expected to make future land opportunities few and expensive.
One of the considered options at the time was to construct a “one-stop shop” at this location for many municipal facilities, including a twin arena, swimming pool, new Town Hall, library, and pool. According to Leavens, the land was acquired in the hopes that “substantial grants from senior levels of government” would be secured to help the Town in financing the project. Control of the East Fonthill Secondary plan is ceded to private developers.
During the mayoral campaign, candidate Dave Augustyn asserts that “Many voters feel misled that this property was purchased without a plan, without public input, and without looking for alternatives.” He pledges to decide whether to sell the property within his first nine months in office. Augustyn defeats Leavens by just 423 votes.
On April 7, Council receives a Facilities Feasibility Study from dmA Planning. The report does not recommend the construction of a new arena on the Town’s 32 acres, instead suggesting that the Town investigate options on the existing Haist Street arena, and look into possible partnerships with Welland, Niagara College, or others.
According to Mayor Augustyn, “The consultant praised the campus-like feel of the Fonthill downtown” after conferring with community groups, sport associations, and members of the public. Augustyn says that, “Pointing to the thousands of Pelham’s YMCA members, the consultant dismissed the idea of a Town-run recreation centre.”
A month later, Council’s Planning Committee votes to sell 27 of the Town’s 32 acres, with five to be retained for wastewater management, but because the Town is unable to find a buyer at the price for which it bought the land, the sale does not take place. Augustyn calls the vision that inspired the purchase of those lands “outdated,” and cites the success of the Welland YMCA as to why a recreation centre in Pelham is unnecessary. Augustyn says that the site is in the “furthest quadrant of the Town,” meaning that “99.5 percent of all current residents would have had to drive and park on acres of asphalt.”
While the consultant recommends the construction of a new arena, the report does not recommend doing so on the Town’s East Fonthill land. “Without any ringing endorsement, I knew we needed to sell the property,” says Augustyn. In further explanation of his vote, Augustyn says that, “I voted to sell the property because I support facilities and parks that complement and enhance our Town and that provide value and service for your tax-dollars.”
While Augustyn votes to sell the property along with three of the six councillors, Councillors John Durley, Dave Emmons, and Sharon Cook vote against the motion. Cook says that selling the land is “irresponsible,” and that, “we will not have this opportunity again.”
In June, Council creates committees to consider the future of three facilities: the Fenwick Fire Hall, Maple Acre Library, and the arena/recreation centre. Augustyn says that the Recreation Facilities Committee is charged with reviewing all arena options, “including twinning the current rink, partnering with Welland or Niagara College on a new twin-pad, fixing up the current rink and partnering with Welland for ice time, or only revitalizing the current single-pad arena.” The committee begins monthly meetings in November of 2008.
At a Council meeting in March, Augustyn suggests that the Town send a signal to Welland that Pelham is a willing partner on recreation facilities. Councillor Durley, as Chair of the Recreation Facilities Committee, is displeased with Augustyn’s suggestion. “It seems like you chose to act independently rather than with Council,” he says at the meeting. Durley says that the focus should be on the best option for Pelham, and not “photo-ops and headlines,” and that sending such a signal to Welland would undermine the work of the committee.
At a meeting in May, it is mentioned that the Recreation Facilities Committee is considering—along with five other options—using the Town’s East Fonthill land after all. Augustyn asserts that the committee, of which Councillors Durley and Cook—both of whom voted against selling the land—are members, is moving too slowly and hasn’t provided Council with minutes or updates on its recommendations. Cook quips that Augustyn’s campaign promise to sell the lands is hijacking the process. Augustyn demands an apology and stops the meeting until Cook provides it. Cook apologizes to staff that the meeting is delayed, and apologizes to Augustyn for reminding of him of his campaign promise, but refuses to provide the apology Augustyn wants. The meeting is adjourned until the following day, at which point Cook makes the apology Augustyn requested.
In July, the committee recommends that the Town-owned land in East Fonthill be the site of new recreational facilities. Council directs staff to hire an architect “to prepare a general concept plan for the building, facility size, and site plan.”
In August, Augustyn writes a column in which he attributes the Town’s continued ownership of the property to the fact that it was unable to sell the land for the price for which it had been bought. Augustyn blames the “Extraordinary Assumptions” that were used for its initial valuation in 2005 for the unrealistically inflated price. Augustyn writes that Council is in the process of deciding “how best to re-designate, sell, or make use of the lands.”
In a reversal of its decision in 2008, in July Council votes “not to dispose of any portion of the Town-owned lands in East Fonthill,” until several issues are resolved. According to Augustyn, the land had been improperly zoned upon its purchase, and before being sold needs to be re-zoned. Council also postpones action on the land until after the finalization of the East Fonthill Secondary Plan, control of which had earlier been ceded to private developers, and until after the final report of the Recreational Facilities Committee. Augustyn says that he is frustrated with the process and believed that “these planning issues should have been taken care of before the property was purchased,” apparently an allusion to previous Council and Mayor Leavens.
In the October election, Augustyn handily defeats Councillor Sharon Cook to win a second term. Cook voted against the sale of the lands in 2008 and during the election she campaigns in favour of building a community centre. During the campaign Augustyn hedges on the matter, saying that it isn’t about being “for or against” a community centre, but rather in asking responsible questions about what Pelham needs and what it can afford. During a debate, he predicts that the East Fonthill Secondary Plan process will be complete in 2011, and at that point a decision on the Town’s East Fonthill lands can be made.
In June, the East Fonthill Secondary Plan is approved.
In the spring, Darren Ottaway is hired as Pelham’s Chief Administrative Officer, replacing the retiring Martin Yamich. Ottaway, who was selected from 55 candidates from across the country, was previously the CAO of Grande Cache, Alberta, where he oversaw a $22 million recreation centre expansion.
In December, Town staff presents a report summarizing seven previous reports on a recreation centre dating back to 1990. The staff’s meta-report concludes that “it is abundantly clear that since 1990 the community has consistently voiced a need and desire for a new twin-pad arena.” The report adds that, “the same cannot be said of the various political representatives during the same time as there is clearly a wide breadth of political opinion ranging from significant land acquisition and facility construction pool facilities and a community wellness centre.”
After receiving this report, Council directs staff to have the Town’s 32 acres appraised and to develop a “business case for community recreational facilities.”
In June, LeisurePlan International Inc. is commissioned by the Town to develop a business case and carry out a market analysis for a recreation centre.
In February, Director of Planning Craig Lamour is terminated. Sources tell the Voice that he is escorted from his desk and led out of the building.
In September, planning department administrative assistant Tara Druzina is terminated.
In January, LeisurePlan presents its report to Council after surveying 1091 residents, 14 user groups, and 46 service providers. It recommends that the Town “replace the existing single-pad with a new arena facility within the next five years.” LeisurePlan finds that in the short/medium term there was insufficient demand for a second surface.
In January, former planning department staffer Tara Druzina files the first of 12 requests under the Freedom of Information Act. The Town provides the first six, but refuses to provide the others, sending a letter to Druzina that describes her requests “frivolous and vexatious.” The letter further states that, “It is evident that your requests are part of a pattern of conduct that amounts to an abuse of the right of access and would interfere with the operations of the Town. In addition, given the nature of your requests in view of recent past experience with you, the requests are regarded as having been made in bad faith and for a purpose other than to obtain access.”
The Town sues Druzina for $20,000 for violating her severance agreement. The lawsuit is settled out of court. Druzina, who had been previously registered to run for Council, withdraws from the race.
In March, for $375,000 per acre, the Town sells 7.8 of its 32 acres to Fonthill Gardens (The Allen Group) contingent upon the construction of a medical centre and retirement residence within five years.
In April, LeisurePlan again reports to Council, recommending the construction of a multi-purpose community centre. The presentation estimated the cost of the centre to be between $22 and $27 million.
In July, Aecom Engineering (via LeisurePlan) presents a report to Council on the existing Haist Street arena. Detailing substantial problems, Aecom estimated that it could cost $2.5 million to upgrade the facility for five to ten years of use. LeisurePlan says that the existing Haist Street arena site may be insufficiently large for a multi-purpose recreation centre. Council votes to initiate a design process for a possible community centre on the Town’s East Fonthill property. Council creates an Architectural Design Advisory Committee to select an architect for the project. In September, Petroff Partnership Architects is selected by the committee.
In October, former Town Director of Planning Craig Lamour, who was terminated in February 2013, files a Code of Conduct complaint against the Town. He asserts that, “Council has failed to ensure accountability and transparency in the sale of East Fonthill lands.” Council rejects Lamour’s complaint, calling it a misuse of the process, since Lamour questions a decision made by Council, not the actions of a specific Councillor or Councillor. Lamour declines to pursue the matter in court.
Also in October, Mayor Augustyn campaigns for his third term. He credits the “How Might We?” so-called “creative problem-solving” process for breaking Pelham’s “recreational log-jam.” During the campaign, other candidates criticize Council for holding too many closed meetings out of public view. Augustyn argues that the Town conducts in-camera meetings as is permitted under the Municipal Act. In defending the Town’s practise, he cites the Ontario Ombudsman in saying that meetings are held in camera, for, among other reasons, “where open meetings would not serve the public interest, or the interests of the municipality.”Augustyn easily wins his third term.
In February, Council approves the Architectural Design Committee’s recommendations of various components to the centre, including a 1200 seat arena and a performing arts space.
Spring: A middle-management, finance-related Town staffer uncovers something about the Town’s financial records that deserved greater scrutiny. Thinking that it was the right thing to do, the staffer brings this discovery to the Town’s attention. By the end of the day, the staffer has been terminated and marched directly out to the parking lot by Town staff.
When reached last week, the former staffer, whom the Voice has chosen not to identify, said the departure was voluntary, and that no further comment would be forthcoming. The individual now holds a finance-related position of comparable responsibility at a different Niagara municipality.
In June, LeisurePlan revises its initial recommendations at the request of the Town and says that “a new twin pad arena facility should be developed such that it is operational by 2018/19.”
In July, Council is informed that the estimated costs of a new design reaches as high as $54 million, while staff pegs the Town’s debt tolerance at $30 million. In light of this, Council asks staff to create a fundraising plan, and to seek out the services of a construction manager who could assist in reducing costs.
In October, Council moves to hire Ball Construction to assist in cost reduction. The Planning and Priorities Committee limits the project’s design to $30 million.
In the latter half of the year, the Town of Pelham enters into an agreement with the Allen Group (Fonthill Gardens), the developer of the Fonthill Marketplace. In exchange for 3.3 acres of land, the Allen Group agrees to be paid in Development Charges credits rather than cash. The Allen Group is later discovered to be offering these credits at a discount to other developers, among them Rainer Hummel. (When the Voice reports on this scheme this past March, Mayor Augustyn asserts that the practice has already been ended.)
In March, Petroff Partnership Architects presents a community centre design to Council. Ball Construction estimates the total cost at $36.2 million.
CAO Darren Ottaway and then-Treasurer Cari Pupo present a financial analysis to Council. Their presentation asserts that the Town’s debt tolerance has now jumped to $37 million, up from the previously reported $30 million in July 2015. Pupo and Ottaway estimate that surplus Town land in East Fonthill will sell for $12 million, and that an additional $12.1 million will be collected by development charges. Ottaway and Pupo report that a fundraising feasibility study shows 85% approval rating for the project among Town residents. A $3 million fundraising goal is set.
Their presentation also states that $9 million of the total $36.2 million project will be debentured through Infrastructure Ontario, at an interest rate of 3.42 percent. The Town says that no further tax increases will be required to build the centre.
In a four-page colour flyer sent to residents, the Town includes a misleading pie chart that depicts the debenture as smaller than in actuality. In a letter to the Voice, Fonthill resident Jim Coyne writes that, “although the debenture is a full quarter of the cost of the project, it is represented as approximately a seventh of the cost in the pie chart illustration…I can only assume that this was done on purpose to mislead residents of Pelham, as I find it difficult to believe that any program involved in making the chart would have allowed for this to happen.”
The Town responds by saying that the error was corrected when brought to its attention.
In early April, Council votes 6 to 1 to approve the community centre design “in principle.” The dissenter is Councillor Marvin Junkin, who says that, “It’s presumptuous of Council to move forward without public consultation. People are angry. They feel that they have not been involved in the project, and the least we can do is give them a voice.”
In late April, at a special Council meeting held at Old Pelham Town Hall, Council votes to approve the community centre project, 5 to 2, the dissenters being Councillors Peter Papp and Marvin Junkin. Papp proposes an amendment to delay the construction of the second ice surface until further financial study can be undertaken. Augustyn rules the amendment out of order.
Junkin says that he, “like a majority of people in the Town,” thinks that a community centre was needed, though says that he felt strongly that “to construct a second ice pad as part of this centre is a huge mistake that the Town will regret in future years.” Council then approves a fund-raising campaign, to be carried out by InterKom Smart Marketing. The campaign’s goal is $3 million towards the centre, and an additional $300,000 to cover the costs of the campaign itself.
In May, Council holds special meeting regarding the financing of the community centre. Staff is directed to create a plan to sell the eight acres at the existing Haist Street arena site, and 20 acres of East Fonthill surplus lands. Council approves an Environmental Impact Study on 12 lots on Balfour Street, between Chantler Road and Webber Road, so that this land may also be sold.
In September, the community centre’s Oversight Committee, comprised of Ottaway, Councillor Gary Accursi, and two residents, begins its meetings. A source who does not wish to be identified, who has intimate knowledge of the oversight committee and its mandate, tells the Voice that it has no meaningful authority, and acts merely to rubber-stamp previously made decisions. Later in the month, Council approves the community centre site plan.
In late November, an official groundbreaking ceremony is held for the community centre.
In March, Port Colborne Regional Councillor David Barrick calls into question the state of Pelham finances before Regional Council. Barrick’s motion expresses skepticism that Pelham will be able to fund the community centre project as stated. (Later, other Regional Councillors express concern to the Voice that Pelham had altered its true debt levels by issuing deferred development charge credits.)
Mayor Augustyn submits a 338-page document as Pelham’s response to Barrick’s motion. Grimsby Regional Councillor Tony Quirk says that, “sometimes in a lawsuit, when you want to hide something, you do a data dump.” Regional Council moves to defer the issue to the June meeting of its Audit Committee.
Augustyn provides numerous media comments that attack Barrick and defend the Town’s actions. “We have shown categorically that their Chicken Little worrying about the sky is falling has no merit,” Augustyn says, referring to Barrick. “In the package, we have a letter from our auditor, and it clearly says, albeit in auditor language, that there are no problems with our financial statements.”
Barrick describes the Town’s document as “an incomplete 338-page document that conveniently fails to include the basics such as the internal control letter and management responses to the audited financial statements.”
In April, the Town hosts an “Evening with the Experts,” ostensibly an event to allow concerned residents to have their questions answered. While Augustyn calls the night a successful exercise in transparency, many in the audience later criticize the event as largely devoid of useful information.
On May 16, Town Treasurer Cari Pupo is terminated. She had held her position for nearly a decade. The Town declines to say why Pupo was fired. The Voice learns that some councillors are privately assuring residents that Pupo’s termination was in no way related to financial concerns.
The day after Pupo’s ouster, the Town hosts a “Thanks a Million, Pelham!” donor announcement, in commemoration of raising its first $1 million towards the $3.3 million goal.
In June, Mayor Augustyn and CAO Ottaway address the Region’s Audit Committee and dispute each of the assertions in Councillor Barrick’s March motion, calling them “misleading and erroneous.” Barrick maintains that his allegations are accurate, and accuses Augustyn of spinning the numbers.
Augustyn accuses Barrick of politically-motivated bullying. Councillor Tony Quirk, who chairs the Audit Committee, says, “I am not sure why they think we wouldn’t have questions or why they wouldn’t be asked. If they find that ‘intimidating’ then perhaps they shouldn’t have provided the information in the first place.” The Audit Committee defers discussion of Pelham’s finances until September.
Also in June, developer Rainer Hummel, who owns property in East Fonthill, makes a presentation to Regional Council. During his presentation, and in a subsequent interview with the Voice, Hummel calls the Town’s 2015 development charge scheme “potentially illegal,” and likens it to printing money “in the basement.” Hummel says that he spoke to Town CAO Darren Ottaway about the program in the summer of 2016, after the Allen Group approached Hummel’s firm. According to Hummel, Ottaway said that, “There’s special ways that we sought legal counsel, and, apparently, there is ways that you can do this, and our lawyer said that it was fine,” before changing the subject. Ottaway later denies making any such statement.
Hummel also alleges that the Town sought to purchase land from the Allen Group in 2015, land that the Allen Group did not own. The Allen Group subsequently bought the desired land—about eight acres—for close to $225,000 per acre. Hummel asserts that shortly afterward, the Town bought three acres of these 8 acres from the Allen Group for $928,000 per acre. During his presentation, Hummel said that “It looks to me nothing more than a backdoor way of bonusing a developer,” an illegal practice in Ontario. In order for these three acres to have been valued at $928,000 per acre, the appraisal made use of what are called “Extraordinary Assumptions,” the same process that years earlier Augustyn identified as making it impossible to sell East Fonthill acreage for the same amount that the Town had paid for it. A senior appraiser in Niagara told the Voice that while inflated valuations aren’t unusual, he’d never heard of a number matching the $928,000 in Niagara for unserviced land with not so much as an access road. “Hello?” he said. “Are they trying to build Disneyland?”
In mid-June, on the eve of an OMB hearing relating to an action brought by Rainer Hummel against the Town of Pelham, senior planner Julie Hannah abruptly resigns. She does not testify at the hearing.
In July, Pelham Regional Councillor Brian Baty calls for the Town to commission a forensic audit of its finances. Baty, who says that the audit is the best way to put all of the questions to rest, receives a largely hostile response from Council. While Councillor Peter Papp seems receptive to the idea, saying that he wants the air to be cleared quickly, and “if there are things that we need to fix or remedy, let’s remedy it as quickly as possible,” others are less enthusiastic. Councillor Gary Accursi says that he would not support a third-party audit. Councillor Catherine King says, “Quite frankly, I find the whole thing absolutely a waste of time. If the general public has that opinion of the Town of Pelham, then clearly they don’t listen to all of the awards, all of the progress, all of the development that we have undertaken, all of the praise that we’ve received.” Councillor Richard Rybiak asserts that those raising concerns about Pelham’s finances are either “people with an agenda who cynically put out a word that they know not necessarily to be true,” or the “victims of cynics.” Rybiak asserts that Baty falls into one of these categories.
In early September, the Town provides its official response to Hummel’s allegations. Accompanied by Town solicitor Callum Shedden, CAO Darren Ottaway presents to Council a “Key Facts” presentation, in which he disputes Hummel’s assertions relating the the 3.3-acre purchase. Ottaway asserts that the land was purchased as parkland, even though the Town’s intention with the property was to build a road through it.
Councillors unanimously pass a motion stating that Council and staff “categorically deny all allegations”; that the Town will no long participate in the Region’s review of Pelham’s finances, as “it lies outside their sphere of jurisdiction”; and which demands the review “be ended immediately.”
In mid-September, at the instruction of Council, Town solicitor Callum Shedden presents to a meeting of the Regional Audit Committee. Shedden informs the committee that Pelham will no longer participate in the Region’s review process because it “lacks jurisdiction” over municipal finances. Shedden notes that Hummel is present in the gallery, but says that Hummel is “in the wrong room at the wrong meeting. He should be at the Town, where there is jurisdiction.”
When questioned by Barrick on specifics on the Town’s finances, Shedden repeatedly asserts that his retainer for the day is merely to report Pelham’s motion to the Audit Committee. When asked about the development charge credits, Shedden says that, “the answers are there—you just have to look for them.”
The Audit Committee votes to request that Pelham commission at third-party audit of its books.
On October 2, at Pelham Town Council, two weeks after the Audit Committee meeting, Mayor Augustyn proposes that the Town commission an audit limited to the disputed land deal.
Councillor Marvin Junkin says that the motion is “too restrictive, and it is incomplete,” before tabling an amendment that calls for a “full review of the so-called questionable land deal, including full and complete access to the Town’s financial records of the past three years.” His amendment directs auditors to evaluate the total debt of the Town, and full disclosure of all development charges and how they were used. Junkin’s amendment is not seconded, preventing discussion or a vote. Councillor Peter Papp says, somewhat cryptically, “Are there things that happened that shouldn’t have happened? Probably.” All but Junkin vote in favour of retaining the firm KPMG to carry out an audit of the 3.3. acre purchase.
On October 5, Pelham resident Curt Harley, representing the lobbying group Pelham D.E.B.T, speaks before Regional Council. Citing a construction Change Log for the community centre, acquired through a Freedom of Information request, Harley points to more than $2.5 million that had been credited from the community centre contract with no explanation as to where these funds went. He also notes that an addition of 9000 square feet of space was not present in the Change Log.
Following Harley’s presentation, Augustyn agrees that there is widespread concern among residents about the Town’s finances, and says that the Town’s reversal on whether to conduct an audit was done after hearing this concern.
The Town says that KPMG will report the results of its limited audit in late November.
November 6: Councillor Marvin Junkin resigns, citing a moral responsibility not to further collude in what he characterizes as a cover-up of $17 million dollars in previously undisclosed debt, brought to Council’s attention on September 5, by an earlier KPMG audit not released to the public.
Written by Samuel Piccolo, with additional reporting by Dave Burket. Voice archival material drawn from reporting by Carolyn Mullin, Sarah Whitaker, Zach Junkin, and Nate Smelle.