Who would own Lansdowne Park?


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Rural Council Reports:              

Memo shows city's legal response to four questions regarding the Lansdowne Partnership Plan


SALE OR NO SALE -YOU DECIDE
:

The General Public in Ottawa have been led to believe that the Lansdowne transaction is NOT a sale of public land by way of unsolicited and noncompetitive bid. The attached memo from the City Solicitor describes the transaction as a lease for 70 years and an option to purchase later:

 

 

 To / Destinataire

 Mayor and Members of City Council

 File/N° de fichier:

 From / Expéditeur

 M. Rick O'Connor, City Clerk and Solicitor

 

 Subject / Objet

 Lansdowne Partnership Plan –
Legal Responses to Four Questions

 Date: June 22nd, 2010


The purpose of this memo is to provide brief legal answers to four questions that have been received from various Councillors in order to assist Council on June 23, 2010 when it resumes the Special Council Meeting pertaining to the Lansdowne Partnership Plan ("LPP") and Implementation Report (ACS2010-CMR-REP-0034). It also seeks to provide further guidance on one procedural matter that arose last week during Council’s questions to staff on this report.

Question 1: The LPP Legal Agreement includes a clause to declare 12 acres of Lansdowne Park as surplus which means it is saleable?

Answer: This is partially correct. The proposal to declare the above parcel of land "surplus to the City’s needs" (as contemplated by the City’s By-law for the disposal of real property), is for the purpose of allowing the City to enter into long-term leases (i.e. 50 years with an option for two further extensions of ten years each) with the Ottawa Sports and Entertainment Group (OSEG) for the proposed mixed-use development component (i.e. retail, commercial and office) of the LPP. Thus, in this instance the declaration is not for the sale of the property, legally known as the freehold interest.

There is distinction in law between a leasehold interest and a freehold interest. In short, the former interest is time-limited (i.e. a 50 year lease) while the latter is not. Thus, the City will always own the freehold interest in the above parcel of land even though it will be subject to long-term leases, in favour of OSEG. At the expiration of the leases, the parcel of land (subject to the air rights disposition for proposed residential development), will continue to be owned by the City. Conversely, OSEG will have no legal right to purchase or sell the freehold interest of the City. That decision could only be made by City Council.

Question 2: In addition, the retail tenant (the Ottawa Sports and Entertainment Group: Greenberg, Shenkman, Ruddy and Hunt) will have the right of first opportunity to buy the land, which means that competitive bidding for the surplus land will not be permitted?

Answer: This is correct. However OSEG would be required to pay the fair market value of the land at the time of purchase. Briefly, the right of first opportunity (being the opportunity to buy the land) in favour of OSEG will mean that there won’t be competitive bidding for the surplus land. That being said, there will be the requirement under the Retail Lease for OSEG to pay the then-fair market value of the property in order to purchase it from the City. This is contemplated to be the same monetary value as what competitive bidding would yield for the City if this right in favour of OSEG did not exist. The right of 1st refusal/opportunity was negotiated by OSEG but, as with all of the other provisions outlined in the Project Agreements described in the LPP report, it is subject to Council approval. It is customary in a commercial setting to give a long-term tenant the first opportunity to buy the land that is the subject matter of the lease should the owner decide to sell.   Generally speaking, developers prefer to own land rather than hold a leasehold interest. OSEG accepts a leasehold interest in this instance because the option to own was not made available. Thus, it is considered equitable, and common practice that if the owner decides to sell the land during the term of the lease, the tenant should have a first opportunity to acquire the land, if the tenant is prepared to pay the fair market value for the land.

Question 3: Pursuant to the Urban Park Project Management Agreement, OSEG will act as a project manager for the construction of the urban park, which includes the front lawn and Sylvia Holden Community Park?

Answer: This is correct, subject to Council’s decision to include Sylvia Holden as part of the Urban Park. Should Council decide not to include the park then the park would remain in its current location and be unaffected by the Urban Park construction. As mentioned by the City Manager on June 17th, 2010, staff is recommending that OSEG manage the construction of the Urban Park so OSEG can use various portions of the Lansdowne Park site for appropriate staging of the construction and can make efficient use of the entire site as needed. Although not mentioned at Council last week, there is also an important legal consideration that led to this recommendation of there being only one contractor on site while construction is ongoing.

It is suggested that this approach will help mitigate the legal risk of the City being considered the "constructor" under the Occupational Health and Safety Act. Therefore, the City should not be exposed to any charges under the Act should there be any health and safety violations. Under that Act, when there are multiple construction activities taking place at one site or in close proximity to one another involving multiple contractors, the owner (i.e. in this case, the City) will be considered to be the "constructor" and therefore will be solely responsible for ensuring health and safety compliance under the statute.

Fines under the Act can be significant (i.e. the maximum fine that the City could be exposed to is $500,000) and the City routinely reviews the proposed staging and sequencing of its construction projects on sites that are in close proximity to each other to ensure that it does not take on the role of the "constructor". This approach is permissible and appropriate and is carried by other owners as well so that they don’t inadvertently assume a legal responsibility that is better handled by construction experts.

Question 4: Pursuant to the Urban Park Project Management Agreement, OSEG will manage the Urban Park, Aberdeen Pavilion and Horticultural Building?

Answer: This is correct, subject to Council accepting OSEG as the manager for all these areas. It should be noted that although not expressly mentioned in the LPP Project Agreement Framework, management of the Urban Park, the Aberdeen Pavilion and the Horticultural Building by OSEG is at the sole option of the City. Further, either of the management agreements may be terminated by either the City or OSEG without penalty on 90 days prior notice to the other party.

Procedural Matter – Disposal of Real Property by the City of Ottawa

Finally, I want to clarify and provide additional information on one procedural matter that arose last week at Council during questions to staff on the LPP. This pertained to the City’ current by-law on the sale of real property owned by it, being By-law No. 2002-38, as amended.

With the enactment of the Municipal Act, 2001 on January 1st, 2003, Section 268 mandated every municipal council to "pass a by-law establishing procedures, including the giving of notice to the public, governing the sale of land" (this clause was largely a re-statement of the requirement found in Section 193 of the former Municipal Act). Furthermore, this provision defined the word "sale" to include "a lease of 21 years or longer." The statutory requirement for a by-law to establish the procedures for the disposal or sale of real property was met when Council enacted By-law No 2002-38.

On January 1st, 2007, the Municipal Act. 2001 was substantially revised with the passage of Bill 130. With respect to the detailed requirements for a by-law regarding the sale of surplus land (including the statutory definition of a 21 year lease deemed to be a sale) Section 268 was repealed and replaced with the following broader requirement in Subsection 270 (1):

A municipality shall adopt and maintain policies with respect to the following matters:

Its sale and other disposition of land.

Therefore, the revised Municipal Act, 2001 no longer specifically mandates the requirement that a municipality’s policy or by-law regarding the "sale and other disposition of land" include a lease of 21 years or longer." However, in subsequent amendments to By-law No. 2002-38, staff have not recommended changes to the definition of the term "disposal", as the inclusion of a lease in excess of 21 years is viewed as a best practice.

Therefore, staff erred last week when, in response to a series of questions posed by Councillor Leadman on the distinction between the Act versus the by-law requirements, staff advised that Council "could not waive the by-law altogether." To be clear, as the statutory requirement to include a lease longer than 21 years in a sale of municipal land is no longer obligatory. As such, Council retains the discretion to waive this requirement which continues to exist in By-law No. 2002-38.

I trust the above comments will be of assistance and regret any earlier confusion that may have arisen at last week’s Council meeting regarding same.

"Original signed by"

M. Rick O'Connor
City Clerk and Solicitor

RO / CT/tm

Rural Council (RCOC) position to its members:

Subject: Lansdowne Live Proposal - Glenn Brooks survey

Dear Members

The Board of Directors of Rural Council of Ottawa Carleton recently passed a unanimous resolution opposing the current plan to redevelop Lansdowne Park. In addition we made a contribution to the Friend's of Lansdowne media fund "BAD DEAL FOR TAXPAYERS".

The Board made its decision having first heard presentations that brought new information to our attention.

Our reasons are summarize below:
  1. The transaction results in the sale of public land and air rights without any competitive bidding process, in fact, the City will not consider any other competitive bid. WE believe this is at variance with the City's own bylaws which encourage competitive bidding  and open, transparent procurement.

  2. The City will invest at least $129 million to bring Frank Claire Stadium to a standard that will support the return of a CFL franchise to Ottawa. WE question City priorities in the providing a subsidy to the owners of a professional sports franchise. Other more pressing needs remain unfunded.

  3. The City's new debt will result in payments of $7.2 M annually. The City estimates that about 1/3rd of this amount will come from property taxes generated from the Lansdowne site . No other land owner in the City can allocate its property taxes to pay for its own building mortgage. This unprecedented allocation of property taxes is the basis for the suggestion that the transaction is "revenue neutral". We believe this is factually incorrect and poor public policy. There's only one taxpayer!

  4. Although a CFL football franchise is being promised to Ottawa, the promoters offer no performance bond or other similar security to ensure the team will remain. There are no penalties that result should the team fail for the fourth time. The debt to improve the stadium will remain however.

  5. Ottawa is preparing for its new transit plan. Costs will exceed $ 2 Billion and may exceed $3 Billion. Lansdowne will not be serviced by the new transit system.

  6. The developer OSEG plans to build a shopping mall on Bank Street in the air space above public land. Air rights are commonly leased however in this case Taxpayers will not be paid rent for 30 years. WE are unable to get an explanation for this unusual aspect of the transaction.
 
 
 
An Alternative Proposal that satisfies many Community concerns may be viewed at:
http://www.letsgetitright.ca/ 
 
Glenn Brooks has supported the development thus far. Much of the information set out above is not posted on his Web Site. He is conducting a new survey before he votes again. Now that you know more we encourage you to vote in his new survey at: http://www.glennbrooks.ca  .
 
Rural Council of Ottawa Carleton


   ADDITIONAL POSTINGS:  


Open Letter on Lansdowne Park -by the Old Ottawa South Community Association:
http://www.oldottawasouth.ca/index.php/oos-news/903-open-letter-june-21-2010


"
It's mainly about a bad process that would give an important public asset for the region over to a single private interest, for a purpose that badly damages the public value of the site.  It's also important that the process has been denying respect to citizens, and to public policies. We shouldn't reward this approach. We can still get to a good one." -Tim Lash


PRESS RELEASE:

Lansdowne Park Conservancy a legally defined "Vested Interest" in Lansdowne Park.

Subject:  

The Lansdowne Park Conservancy has a vested interest in Lansdowne Park.
 

Date:  

Friday, June 25, 2010
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Background: 

The Lansdowne Park Conservancy (LPC) and Coordinator John E. Martin, have a vested interest in Lansdowne Park which will be pursued in a court of law, if necessary.
 


 


 

 


 

Be it resolved:
 


 


 

 


 

1. That the Lansdowne Park Conservancy presents a new and alternative option for the City of Ottawa to be examined under the current framework of the Non-Competitive section of the City of Ottawa Procurement By-Law 50, and as directly relates to the Ottawa Option Plan.
 


 


 

 


 

2. The Conservancy proposal effectively meets the City of Ottawa requirements of revenue neutrality and surpasses it with revenue sharing and zero cost to the taxpayer.
 


 


 

 


 

3. That the use of the word “unique” by the City of Ottawa to define the current bid under examination as a means by which to sole source is unsupportable, is contrary to commonly accepted open and fair competitive practices to determine best value for the City Corporation, and if necessary, will be challenged in a court of law.
 


 


 

 


 

4. That the City Manager is on the public record as saying the current sole sourced bid has no means by which to be determined as being in the best interests of the taxpayer. He has nothing to compare it against, contrary to the role of that trusted position.
 


 


 

 


 

5. That Lansdowne Park Conservancy is a management model for all of Lansdowne Park, will ensure that 100% of the park will remain public in perpetuity, and will willingly subject itself as a viable and affordable alternative under an open and competitive framework, to the current proposal and any other bids,.
 


 


 

 


 

6. That the Lansdowne Park Conservancy has ably demonstrated to the City of Ottawa that should a 24,000 seat two sided stadium with rain cover be established as a requirement, be it resolved it has been proven and will be shown in a court of law that new construction for an equivalent stadium structure on a new site will be 30% less expensive than what is currently proposed.
 


 


 

 


 

7. That the Lansdowne Park Conservancy has ably demonstrated to the City of Ottawa that a stadium tied development is based upon density, and that greater available density, and thus greater taxation return and profitability to the City of Ottawa, is available on a more suitable location to be examined, specifically, the Bayview/Somerset Development Area.
 


 


 

 


 

8. That the Lansdowne Park Conservancy has ably demonstrated to the City of Ottawa that major new structures of a stadium and a shopping/commercial/residential complex must be in accordance with the City of Ottawa Master Plan of being adjacent to rapid transit and that the current proposal to the City of Ottawa fails that major and required urban planning necessity.
 


 


 

 


 

9. That the Lansdowne Park Conservancy has ably demonstrated that a stadium tied development that takes advantage of the new multi billion dollar rapid transit expansion not only meets the Ottawa Master Plan, but provides the highest use of municipal efficiencies, follows the internationally accepted standard of Transit Oriented Development (TOD), would provide best value for the Citizen taxpayer (shareholder) within the City of Ottawa Corporation and needs to be fully examined in accordance with best procurement practices as outlined in the City of Ottawa's Procurement By-Laws prior to making any long term development decisions with respect to Lansdowne Park.
 


 


 

 


 

10. Finally, be it resolved, that the Lansdowne Park Conservancy presents an alternative that more than ably demonstrates a clear vision to the City of Ottawa for the future of Lansdowne Park, meets and surpasses all of the necessary requirements of the City of Ottawa with respect to Transportation, Heritage, LEED, greatest use/benefit, quality of life, revenue surplus (surpassing revenue neutraility), zero taxpayer cost, long term goals, and best use of stadium (for amateur sport). The Lansdowne Park Conservancy is steadfast in its resolve to be thoroughly and properly examined as a viable, affordable and highly ecologically suitable alternative for the City of Ottawa, and to have said thorough examination completed prior to any long term decisions or commitments on the future of Lansdowne Park.
 
 
 
John E. Martin
Coordinator
Lansdowne Park Conservancy/
Conservation Parc Lansdowne
99 Fifth Ave., Suite 417
Ottawa, ON K1S 5P5
613.898.1284

The Coordinator of the Lansdowne Park Conservancy/Conservation Parc Lansdowne asks readers to imagine what the results might be if the following poll question was asked of Ottawa citizens, after reading the background facts, below:

 

POLL QUESTION

Background:

 
There are now two unsolicited bids before the City of Ottawa on the future of Lansdowne Park.
 
You have heard much about the developers bid but not much about the new bid from the Lansdowne Park Conservancy or LPC bid:
http://www.lpc-cpl.ca/img/conservancybid.pdf
 
Some quick background on the LPC is that:
  • it is a nonprofit management model that will keep the park 100% public
  • there will be some retail in the park using the existing buildings, but no private homes or towers
  • an outdoor stage for festivals, the NCC Orchestra summer series (free) and open air theatre
  • an extra playing field for amateur sport
  • a year round heated outdoor mineral water pool adjacent to the playing fields
  • plenty of green space and trees
  • increased underground trade space keeping the popular activities on the site
  • all site revenue surplus will be returned back into the park
  • any unused amounts will shared with the City
  • the City/taxpayers retain ownership of the land and the City and the Public sit on the Volunteer Board
  • all plans for the site are from full public consultation
  • all contracts for the site awarded by open competitive procurement process
  • all present and future costs from the site removed from the City books
  • City and taxpayers receive a tenant who pays for all the renovation  
  • it is zero cost to the taxpayer and the City
Question:

Between the Developers Bid and the Conservancy Bid which would you prefer? 

 ____________________________________________________________________________

Lansdowne Park Conservancy/Conservation Parc Lansdowne 

Tel: 613.898.1284, info@lpc-cpl.ca

 

UPDATES:

Lansdowne agreement has Sens president fuming
SUSAN SHERRING, Ottawa Sun
http://m.ottawasun.com/News/14508756.1?fullscreen#news

Lansdowne Park deal unlawful: Lawyer
CBC report with comments and video clip - June 26, 2010

Delay Lansdowne vote: Councillors
http://www.ottawasun.com/news/ottawa/2010/06/26/14529811.html
"Council will be “voting blind” if Monday’s highly anticipated decision on the future of Lansdowne Park goes ahead, say Councillors Clive Doucet and Christine Leadman.

...Doucet and Leadman said staff failed to meet conditions for Monday’s vote to proceed, and are calling for the vote to be pushed back until the comprehensive master site plan is finalized and an independent third party review is completed, turning the contentious redevelopment plan into an election issue and handing the reigns to the next council."
 
Full story...

Up-Date: July 23, 2010:
Letter from Lansdowne Park Conservancy to Mayor and Council

 

 

From: Lansdowne Park Conservancy [mailto:jemartin@lpc-cpl.ca]
Sent: July 23, 2010 7:19 AM
To: Diane Deans (Diane.Deans@ottawa.ca)
Cc: City of Ottawa Jeff Byrne (jeff.byrne@ottawa.ca); City of Ottawa Kent Kirkpatrick (kent.kirkpatrick@ottawa.ca); City of Ottawa Nancy Schepers (nancy.schepers@ottawa.ca); City of Ottawa Steve Kanellakos (steve.kanellakos@ottawa.ca); City of Ottawa Marian Simulik (Marian.Simulik@ottawa.ca); Ian Frazer Duncanson (eodsa_secretary@rogers.com); 'Councillor Alex Cullen'; 'Councillor Bob Monette'; 'Councillor Christine Leadman'; 'Councillor Clive Doucet'; 'Councillor Diane Holmes'; 'Councillor Doug Thompson'; 'Councillor Eli El-Chantiry'; 'Councillor Georges Bédard'; 'Councillor Glenn Brooks'; 'Councillor Gord Hunter'; 'Councillor Jacques Legendre'; 'Councillor Jan Harder'; 'Councillor Maria McRae'; 'Councillor Marianne Wilkinson'; 'Councillor Michel Bellemare'; 'Councillor Peggy Feltmate'; 'Councillor Peter Hume'; 'Councillor Rainer Bloess'; 'Councillor Rick Chiarelli'; 'Councillor Rob Jellett'; 'Councillor Shad Qadri'; 'Councillor Steve Desroches'; 'Mayor Larry O'Brien'

Subject:
Lansdowne Park Conservancy and Parks, Recreation and Culture
 
 
City of Ottawa
Parks, Recreation and Culture Steering Committee
Councillor Diane Deans, Councillor Christine Leadman
Chairperson Advisory Committee, Ian Duncanson
 
 
Good morning Diane and Christine and Ian,
 
Just to keep you and the Steering Committee for Parks, Recreation and Culture
apprised of details as things progress with the Conservancy.
 
As you know the Conservancy submitted its nonprofit management model bid
for Lansdowne Park to the City of Ottawa on June 21, 2010.
 
As part of our mission the Conservancy wishes to actively promote the same
objectives as the committee with respect to healthy living, accessibility and cultural
experience and apply those aims to Lansdowne Park.
 
The direction from Council is to keep a full stadium at Lansdowne so the Conservancy
has retained an internationally recognized stadium and large project management firm
to provide necessary illustrations, job costing and the ability to carry out the
Conservancy project.
 
As part of our articles of incorporation the Conservancy will wish to work closely
with the City of Ottawa, who will have an Ex Officio place on the Board as well as
to report and work closely with the Steering Committee on Parks, Recreation
and Culture.
 
The City of Ottawa will maintain full ownership of the property and retain full access
to the stadium scheduling under the Conservancy model. Management will be provided 
by dedicated Conservancy professionals who in turn will work together with City employees
under a purchased services agreement.
 
Once again, it is the aim of the Conservancy to provide the best possible outcome
at Lansdowne with respect not only to healthy living but to bottom line as well.
 
All the best,
 
John
 
John E. Martin
Coordinator
Lansdowne Park Conservancy/
Conservation Parc Lansdowne
99 Fifth Ave., Suite 417
Ottawa, ON K1S 5P5
613.898.1284
 

 

Sept 9 - 2010  Group takes city to court over Lansdowne Park

Jan  9 -  2011  Lansdowne Conservancy plan finally getting noticed -Ottawa Sun

Jan 21 - 2011  Conservancy/NBBJ bid yields $4M in annual savings for City of Ottawa

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