The ACDC/AVI Site Remediation


Admiral CollingwoodEarlier this week, members of council received this email from Ian Adams of the Enterprise Bulletin about the upcoming motion on remediation of the empty property at Hume and Hurontario Streets:

I was wondering if I could get your thoughts with regard to extending/not extending the site remediation agreement for the ACDC/AVI property, and whether an extension should be granted/not granted. Ian Adams, Collingwood Enterprise-Bulletin

The site remediation agreement is unique: it is, as I have been told by the Planning Department, the only one of its kind ever made on any property in this town. It was made at the request of the AVI developer, not the town, but the town agreed to it as the third party. At that time, it seemed reasonable that development would have started within the three-year term of the agreement. That proved overly optimistic, in light of the sluggish economy.

As the town’s lawyer stated, this is a tripartite agreement that requires the agreement of all three parties to change (and, if any party wished, to discard). Any single party has the right to challenge one or both other parties in a court over the terms.

While the onus for enforcement unfortunately falls to the town under its property standards bylaw (section five), the town is given the discretion when and even whether to enforce it (section four). Any enforcement would be a costly legal challenge and a lengthy court battle for taxpayers. Potentially several years.

Keep in mind the expensive legal battles that arose when the former council removed the legally and democratically-approved permits from the site. Those cost taxpayers more than $100,000. Plus there were subsequent costs to restore and amend some of the agreements to allow the developments to proceed. That doesn’t even mention the costs the developers went through – to get the initial permits, approvals, heritage impact studies, architectural drawings and the properties themselves – and for ACDC to have to pay for a redesign and new heritage impact study last term.

To return the site to what it was before those permits were rescinded last term could cost much more. And we would be no further ahead than we were in late 2006 when we had approved a signature building on the site. Except without the prospects of that beautiful building.

Would this benefit the community or the town? Or just waste more taxpayers’ money to pursue what might be better and more effectively gained through negotiation and compromise?

Conflict and confrontation are not good – nor wise – negotiating tactics. And they are not what a municipality should be known for.

On May 10, 2014, Council received a letter from Stephen Christie, lawyer for the AVI developer. In it he wrote,

AVI would consent to a one year extension, to April 30, 2015, of the date by which ACDC must either substantially commence development of its property or fill the existing excavation.

This suggests there is an apparent agreement by both developers for an extension, although ACDI asked for a two-year extension, not a one-year. Based on correspondence from both parties, and on staff’s discussions with the developers about their intentions and wishes for the site, a motion was crafted by staff and our legal counsel that tried to accommodate both parties as well as meet the needs of the community.* It read:

THAT Council grant the requests for an extension for a period of two years for Admiral Collingwood Development Corporation (“ACDC”) and one year for Admiral’s Village Inc. (“AVI”) to the term specified in the existing Site Remediation Agreement (“SRA”), subject to the following terms to be substantially incorporated into the revised agreement be appropriately executed by the Mayor and Clerk:

  • a) That Council authorize the SRA be bifurcated into 2 separate agreements;
  • b) That each land owner provide the Town with a general comprehensive liability insurance policy in the amount of $10,000,000.00 in a form satisfactory to the Town, indemnifying the Town from any potential liability which may exist if the lands remain in their current condition for the extended term;
  • c) That each land owner provide the Town with a letter of credit in a form and in an amount satisfactory to the Town and to keep the said letter of credit in full force and effect and pay all premiums to secure the boulevard remediation of the Town owned property adjacent to the subject properties;
  • d) That Council permit the electrical supply structure be relocated on the ACDC site; and e) That the owners be required to secure the perimeter of the site including hoarding along the common boundary.

It was presented as council’s preferred position last meeting – but later deferred to the upcoming meeting (to allow the developers and councillors to digest). Here is my response to Mr. Adams, sent earlier this week:

We all want to see that corner developed. No one likes an empty property downtown. We might have had a beautiful, luxurious, signature building there, had things gone differently last term.

Clearly that is what the public wanted from the start – as shown by a 2,500-name signature presented last term and a 1,200-name signature presented this term, and a public meeting in support of the project that packed in more than 350 residents.

This council inherited the problem and the hole. We have done our best to find a solution and to make it easier for the developers to move ahead. However, we cannot fix the economy, or restore any loss of confidence in the project that stems from actions taken in the past. We cannot turn back the hands of time and fix the mistakes made last term.

The remediation agreement was initiated by one of the developers – not the town – at a time when it was reasonable to assume the site would have been developed by now. That proved overly optimistic. The developers have both since requested an extension of that agreement. As far as I can see, only some details need to be ironed out to satisfy everyone.

In order for the town to proceed alone, we would have to take one or more likely both developers to court. I don’t see any good reason why taxpayers should pay for a legal challenge that could be both lengthy and very expensive, when we can come to a reasonable agreement with all parties.

As Mr. Longo said to council, either developer can take the other to court over these issues and pay the legal costs themselves to get remedial work done. I believe the town should do its best to facilitate a solution, and look after the public interest where necessary, but we should not become further entangled in a costly fight between them.

And even if we did enforce it, what would we get? An empty lot, probably still surrounded by tall hoarding. Not a development, not a park, not a playground. It would serve the political goals of a few people, but not the greater good of the town.

What advantage to the town is there in forcing the matter at this time? That will not get anything built on that corner and will not help either party sell the properties to someone who can afford to develop them in the future. Such behaviour sets a bad precedent, and will reflect poorly on the reputation of Collingwood.

I believe what was proposed by staff and our legal counsel was an appropriate solution that considered the concerns of all three parties and represented the best solution for the town. I voted for a deferral because I felt the developers should have an opportunity to consider it. However, I will vote for the motion when it returns to the table.

Subsequently, Mr. Assaff, owner of the ACDC site, wrote to council noting his agreement with the terms of the motion. He added that he was in discussions with possible buyers who could move the development forward and that filling it in at this time might jeopardize those negotiations:

I am writing to you to confirm my agreement with the terms of the motion that was read out at the May 12th meeting of Council regarding the two year extension of the above noted agreement. This agreement has now lapsed and if the three parties in the agreement can not agree with terms that will allow an extension to be executed I am fine with that as well. It was never my desire to have this agreement executed in the first place.

I continue to have discussions with interested developers & tenants regarding an exciting addition to our wonderful downtown and I am very confident that there will be some good news announced well before the two year extension expires. This will allow the excavated area to be filled in with a wonderful new building rather than with fill that would have to be removed again and only add to the costs of trying to develop this property.

A second letter from Mr. Christie, also received late this week, appears to contradict his earlier statements and says in part:

AVI’s strong preference is that the site remediation agreement be enforced and that ACDC be required to fill its excavation and remediate its site now… AVI, as a courtesy to ACDC, is prepared to consent to an extension of the date for commencement of construction on the ACDC lands until April 30, 2015 provided:

  1. (a) The amended site remediation agreement also requires ACDC, at its sole expense, to relocate its construction trailer and the separate electrical shed now located on AVI’s property to ACDC’s property no later than May 31, 2014, being the date by which the Town has required AVI to remove ACDC’s trailer and the electrical shed from AVI’s lands.
  2. (b) The amended site remediation agreement also requires ACDC, at its sole expense, to fence the eastern boundary of its property no later than June 30, 2014.

Mr. Christie suggests his client’s site could be hydro-seeded and the hoarding removed, even though the hoarding agreement has not been discussed at council. He also notes his objection to splitting the remediation agreement:

AVI will not consent to the proposal to “bifurcate” the site remediation agreement, or separate it into two separate agreements with differing terms, as contemplated by the motion put to council at its most recent meeting. This would have the effect of rendering the agreement meaningless to AVI, leaving it entirely to the Town’s discretion to enforce or not enforce the site remediation agreement with ACDC.

I believe that section four of the current agreement already leaves it to the town’s discretion. Mr. Christie also notes:

As you know, we have had preliminary discussions about the use by the Town of the AVI lands for a public park, pending development of the AVI lands. If the details of such an arrangement are worked out, AVI would commit to removing the hoarding and leaving the existing wire fencing in place.

Using private land for a public park involves several considerations. The first is liability. Unfortunately, until the provincial laws of “joint and several liability” are reformed, I would not be willing to support any such suggestion.

The potential costs in a lawsuit over injuries or damage to property are simply not worth the risk.

Also, we were told by our CAO, clearly and forcibly during our budget discussions, that we have to continue to watch our spending. Adding a park site that needs maintenance, cleaning, police oversight and perhaps accessories like lighting and benches or landscaping was not budgeted for this year. Plus we would need to make sure it met the regulations for accessibility – at town expense.

It is not, in my mind, appropriate to create a public space only to remove it when the site is sold or developed (think of the furor created when a housing site was suggested for land currently used for a “temporary” soccer pitch in the east end). If the public gets accustomed to using the site for its own, there would be resentment over its closure (as we have also seen when public dog parks were closed).

The town does not have the money to buy or expropriate either property (several millions of dollars – this council has concentrated on paying down the $45 million debt we inherited, not building it up).

Even if we had the money, doing so would not necessarily be in the best interests of the downtown or the community at large. We need a long-range strategic plan for the downtown to decide which is more important to the vitality of the downtown: revenue-and-job-creating commercial development, with additional residential space and potential consumers and customers, or open, public space?

Unfortunately, the agreement did not have a clause allowing it to be reconsidered or revisited if circumstances so dictated.

The best solution, I believe, is to retain the hoarding around the entire property to keep the public off the site while we continue discussions with both parties. We should work towards an amicable solution that benefits all parties and still encourages development on – or sale of – two properties that have too long sat empty.

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* Contrary to what has been suggested by some, staff did not recommend enforcing the agreement. What staff recommended in the agenda and report was for council to choose between two options:

RECOMMENDING THAT Council consider one of the following two options regarding the requests for extensions to the term specified in the existing Site Remediation Agreement with ACDC and AVI:

  1. Not grant the requests for extensions; or,
  2. Grant the requests for an extension (with a timeframe to be specified by Council) with the following conditions:
    • a) That the land owners provide the Town with a general comprehensive liability insurance policy in the amount of $10,000,000.00 in a form satisfactory to the Town, indemnifying the Town from any potential liability which may exist if the lands remain in their current condition for another year;
    • b) That the land owners provide the Town with a letter of credit in a form and in an amount satisfactory to the Town and to keep the said letter of credit in full force and effect and pay all premiums until either the works outlined in the Site Remediation Agreement are completed, or the Town draws on the letter to the extent necessary to complete any outstanding works.

The subsequent motion that amends the second choice listed here was made with staff input based on the letters and discussions described above.