TORONTO- On June 14, 2011, The City of Toronto City Council approved a proposal which terminates the 75-year long management agreement with the Kiwanis Club of Casa Loma (KCCL).
The proposal passed without debate.
Under the terms of the proposal, The City will pay KCCL $1.750 million ($1.45 m for Casa Loma artifacts, plus $300,000 in management fees), and will also waive all lease arrears, in the amount of $3.20 million. (1)
Despite taking over responsibility for managing the Castle from KCCL, The City is still granting the charity a new license to KCCL to remain permanently at Casa Loma, but is charging no rent.
Mayor Rob Ford told reporters after the June 14 Council meeting, “I think Casa Loma is something we will eventually have to sell. That’s the bottom line.”
The June 14 decision is the final step in a series of council decisions to terminate KCCL’s involvement with Casa Loma, dating back as far as 2007. (2), (3).
The remaining question is why Mayor Ford’s council is disregarding those previous decisions, and paying approximately $5 million to KCCL in an undisclosed package payout to finalize termination of their lease agreement while also granting a new license to KCCL to remain in Casa Loma for free?
The City of Toronto has been subsidizing the Kiwanis Club’s operation of Casa Loma for over 75 years. Without the taxpayers’ knowledge, KCCL has been exempt from paying property taxes during the successive 20-year lease agreements. One of Toronto’s primary tourist attractions reaps in over $6 million in revenues annually, yet the City of Toronto receives less than 10% of those revenues.
For the past three-quarters of a century, the bidding process for the management of Casa Loma has been closed. The City of Toronto has granted exclusive, non-competitive and sole-source leasing management of Casa Loma to KCCL. No competing bids were elicited, hence none could be considered.
This has resulted in mounting and unnecessary losses, with Casa Loma falling increasingly into disrepair.
The interior of the castle has deteriorated over the years, as KCCL has simply not made the promised two million dollars worth of upgrades and renovations as part of their 2008 lease agreement. Meanwhile, in the past decade the City of Toronto has invested almost twenty million dollars in exterior restoration to the castle as part of their $32-million capital cost plans.
The current Council’s actions have undermined previous the Council’s decision in July 2010, which had directed the City Manager to terminate the Kiwanis Club’s lease after the City reviewed their management agreement, in which several lease obligations had not been fulfilled.
There are many conflicts of interest involved in the negotiations here.
First, the City of Toronto’s General Manager of Economic Development & Culture recommended in his May report to appoint himself as the new chair of the Casa Loma Corporation for the City’s takeover of operations during the next 18 months or longer.
Second, the Deputy Mayor, Doug Holyday, stated while chairing the Executive Committee that he was a former president of the Kiwanis Club and highly praised the KCCL.
Third, KCCL chair Richard Wozenilek has refused the order by previous council (July 6, 2010) to step down as chair of KCCL, due to his conflicts of interest in paying himself legal fees. The chair is a ‘volunteer position’ appointed by the City of Toronto for a three-year term; however Mr. Wozenilek has been in that position for over 18 years.
Why has the City not been held accountable to the people of Toronto? To Take Back Our Casa Loma. To revitalize Canada’s only castle and one of Toronto’s primary tourist attractions. To restore the spectacular renaissance castle as it was before the Kiwanis Club was allowed by the City of Toronto 75 years to devalue this iconic property.
Contact:Trelawny Howell (great grand-niece of Sir Henry Pellatt, builder of Casa Loma)
tel: 416 927-9866, email: trelawny@rogers.com or visit: www.CasaLomaTrust.ca
References:
(1). (2010 City Mgr. Recommendations’ pg. 3- 4)
http://www.toronto.ca/legdocs/mmis/2010/ex/bgrd/backgroundfile-31430.pdf
(2). On 2007-9-18 The City’s previous council had granted KCCL a 20 year lease/Management Agreement without calling for competitive bids, commencing July 1st 2008, disregarding the advice of The City’s Manager and the 3 year report of it its Casa Loma Advisory Committee (CLAC) which stated it was unsustainable to continue leasing Casa Loma to KCCL.
(3). In June 2010, the previous City council in June 2010, had ordered an early termination of the KCCL’s lease due to their unfulfilled lease obligations following the City’s initial audit and review. KCCL owed the city over $3.2 Million in lease arrears plus unfulfilled renovation obligations.
This was executed under The City’s management agreement option for early termination without penalty.