Re: EX35.2  Casa Loma Request for Proposals-Operator for Main House and Grounds

Speaker: Trelawny Howell,

Great-grandniece of Sir Henry Pellatt, builder of Casa Loma

Since 2005, I have being speaking at Executive Council meetings and sending letters to City Councilors and staff, advocating for an open governance process and revitalization of Casa Loma.

In April 2005 I received my first media support after an article I wrote on Casa Loma’s fate was published in a magazine. It was about the City’s unaccountable history of leasing Casa Loma solely to the Kiwanis Club since 1936. I was a member of the Kiwanis Club of Casa Loma for six years and resigned in 2005 before writing my article. I knew firsthand that the city privately subsidized Kiwanis Club Charity operations for 75 years, renewing their leases without ever having an open tender process for competitive bids.

I took my article to the City’s Press Gallery. The Globe and Mail’s City bureau chief, not to mention the National Post, Toronto Star, and CBC radio, then contacted me for interviews.

Since then I have continued to advocate for the open completive leasing of Casa Loma. For the past eight years I have seen City Council and the Executive Committee disregard reports made by City staff and their appointed panels.  CLAC’s 2007 report determined that Kiwanis Club management was ‘unsustainable’. But their recommendation for an open tender process for the future management of Casa Loma was never adopted.

At the City’s Executive Committee meeting in July 2007, I spoke about potential options for the future use of Casa Loma. I suggested Liberty Grand and The Carlu should be the top contenders to operate Casa Loma, given their successful history of restoring and running venues in the City’s other grand heritage buildings.

In December 2007 Liberty Group was even hired by Kiwanis Club to be Casa Loma’s new caterers, to help secure their proposal to the City for another 20 year lease.

Like the city’s own staff recommendations, for several years I urged City Council to conduct an audit of Kiwanis management. Instead, they awarded Kiwanis Club another 20-year lease in July 2008.

Shortly after the new 20-year lease agreement was signed, Liberty Group’s catering deal with the Kiwanis Club disappeared.

In July 2010,  after a city-appointed auditor revealed mismanagement, arrears in rents, non-compliance with several other lease obligations, and the Kiwanis Chair’s ‘conflict of interest’ for receiving legal fees, City Council finally terminated the Kiwanis lease.

Yet the City’s headaches caused by the Kiwanis Club were not over.

The City’s lease to Kiwanis had an out-clause; the City could terminate its 2008 lease after 2 years without penalty because of the non-compliance issues found with Kiwanis in the audit.

However, the City Manager negotiated a termination deal to pay Kiwanis Club over $5 million dollars in ‘undisclosed’ fees, including $3 million the city waived for arrears in rent and obligations for improvements that Kiwanis did not make to Casa Loma.

The City paid Kiwanis  $1.45 million to purchase Casa Loma’s furnishings and artifacts, many of which had been donated to Casa Loma in the first place. The City also paid $300,000 in management fees to subsidize the Kiwanis Cub charity.  Due to their charity status they were also exempted from paying property taxes in their lease agreement.

Furthermore, the City made a new agreement with Kiwanis Club to let them remain at Casa Loma ‘rent-free’ during the City’s 3-year process to find a new operator.

City Council voted for this deal as well, without any debate and without transparent accountability for the $ 5 million in payouts to Kiwanis Club.

In 2011, the City finally took over the interim-management of Casa Loma.

Three years later the process I had been advocating for the past nine years finally took place.

A new operator has now been selected through the RFP – Request for Proposals. An open-tender bidding process. This chosen operator, Liberty Group, will be considered by the Executive Committee, then considered by City Council on November 13^th, subject to the actions of Executive Committee. If selected, it will take over the lease operations of Casa Loma in January 2014, under a 20-year lease agreement.

2014 will commemorate the new era for ‘Liberty’ at Casa Loma, a century after it was built for Sir Henry Pellatt.

In recognition of my contributions over the past nine years advocating for an open process in Casa Loma’s governance, I would like to a role in working with The City and Liberty Group to revitalize Casa Loma.

I would also like to see the proposed City Museum in the ‘Hunting Lodge’ include a section devoted to the history of Sir Henry Pellatt’s accomplishments. To include all available press documentation from the past to the present in order to tell his full story and showcase the evolution of Casa Loma over that last century since it was built in 1914.

Thank you for your consideration of my work’s value and the historical representation I can contribute to the revitalization of Casa Loma.

Trelawny Howell,

Great grandniece of Sir Henry Pellatt,

Builder of Casa Loma era 1914

References to the City reports, Executive Committee, Council meetings, letters and the Press archives since 2005 can be found at:

www.casalomatrust.ca

www.CasaLomaTrust.ca
trelawny@rogers.com
Tel:  416 927-9866

      Re:  EX 22.2 Future Options for Casa Loma

September 10^th 2012

Good Afternoon, Mayor Ford and members of Executive Committee:

As you consider the staff proposal for the future of Casa Loma, Please take the necessary steps to ensure that past mistakes (outlined in my attached report) are not repeated. The staff recommendation for RFP’s (request for proposals) process, using an independent consultant to oversee the process is a good start.

Appendix C – Terms to be Included in the Casa Loma RFP
(http://www.toronto.ca/legdocs/mmis/2012/ex/bgrd/backgroundfile-49693.pdf

However, the terms of reference for both should be bolstered to ensure the process is truly independent and transparent.

In 2007 CLAC the city commissioned Casa Loma Advisory Committee recommendations were to have an open tender RFP process following their 3-year study. Council choose NOT to follow CLAC’s recommendations and they renewed Kiwanis Club’s unsustainable Lease for another 20 years. Resulting in the city paying Kiwanis Club over $5M in undisclosed fees, including over $3 million, the City waived from KC’s arrears in rent and lease obligations. Kiwanis Club continue to maintain their offices in Casa Loma  Rent Free!
The City must strive to avoid these scenario’s that have been repeated throughout their 80 years of mis-management of Casa Loma. As they have been with other City properties, where unrealistic proposals were accepted and ultimately failed. (i.e. The Guild Inn)

There is an incentive to ‘over-promise’ when negotiating the lease contract in order to get the JOB and then to skimp or even defraud the City, in order to profit from holding the contract. Particularity with Casa Loma as it may be up for SALE! As Mayor Ford told the press during last years June Council meeting. “I think Casa Loma is something we will eventually have to SELL- That’s the bottom line”.

The City finally hired CBRE Hotels as business advisors to evaluate the potential uses, costs and benefits that would accrue to an operator.

Appendix B – Report from HLT Advisory Inc., Philip Goldsmith & CBRE Hotels
(http://www.toronto.ca/legdocs/mmis/2012/ex/bgrd/backgroundfile-49692.pdf)
This will help so unrealistic RFP bids can be rejected, as Council needs to be aware of what it will cost to maintain our incredible City asset,Canada’s Castle!

The City should be prepared to work in partnership with the successful bidder. Viewing Casa Loma as a cash cow or perhaps even to expect a break-even scenario for the City may be Unreasonable.

My great Uncle Sir Henry Pellatt built Casa Loma. I have a strong sentimental interest in seeing a successful future forToronto’s Castle.

I believe the majority of Torontonians share this desire to see Casa Loma properly maintained as a great part of our public heritage and Toronto’s 2^nd largest tourist attraction,Canada’s Castle!

If time permits, I would like to read the brief report I made from last years council meeting.

“A Century of Mismanagement of Casa Loma continues” (attached report)

Thank you for this opportunity to speak!

Trelawny Howell,

Trelawny L. E. Howell

Great grandniece of Sir Henry Pellatt

www.CasaLomaTrust.ca
trelawny@rogers.com

Tel:  416 927-9866

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.