More On The Therme Sweetheart Deal

The following video is the NDP's Chris Glover talking about how the deal Doug Ford has struck with Therme Spa is a bad one for taxpayers. Just before watching it, here is a little context for the rent from Therme that Glover talks about:

The amount the provincial government expects Therme to pay it in direct rent payments — estimated to be at least $1.1 billion — over the [95-year] course of its lease will be partially dependent on the business’ success. Its lease’s terms will require Therme to pay the province minimum rent at a rate of 3.5 per cent of the land’s value. Additional “performance rent” payments from Therme are also expected by the province, several years after its facility opens.

Under the lease, Therme’s annual payments to the province will be capped at eight per cent of the land value. 

Despite his folksy charm, at almost every turn it is clear that Mr. Ford is not here for us, the taxpayers.

 

 

How Sweet It Is

 

People of a certain age will remember Jackie Gleason and one of his famous taglines: "How sweet it is." Delivered with an insouciance only Gleason was capable of,  it was a line that was applicable to many of his skits. Unfortunately, applying it to a real-life situation in Ontario means it must be spoken only in a bitter and cynical way, unless you are part of the Austrian group developing the Therme Spa on Toronto's waterfront. 

The Doug Ford government recently released some of the details of its 95-year-lease with the company, but first, just a couple of details about group:

Therme Canada, the latest deep-pocketed firm with designs on a chunk of Toronto’s waterfront, is a far more opaque organization, privately held, with no publicly disclosed source of financing besides the entry fees and ancillary revenues generated by its spas.

The company, however, has deep local connections, overseen by executives who have worked in the office of Premier Doug Ford as well as lobbyists such as StrategyCorp’s John Perenack and Leslie Noble, and Amir Remtulla, Ford’s former EA from his days at City Hall. Its local architect is Diamond Schmitt, whose renderings have stirred controversy since they were made public in the summer.

Mmm. friends of Doug Ford do have a history of prospering. In any event, the details of the deal that we are thus far permitted to know seem to suggest a very sweet deal at the expense of the usual suspects: taxpaying citizens:

The lease shows Ontario has promised 1,600 dedicated parking spaces for Therme, and the government says it is proposing a total of 2,500 parking spaces for Ontario Place. Some of Therme’s parking spaces are set to be shared with Live Nation during concerts.

Bear in mind that these spaces care being paid by the taxpayer, but the pain doesn't necessarily stop there:

If the province fails to meet its parking obligations before the spa resort opens, or 2030, whichever comes first, the lease compels taxpayers to give Therme $5 per spot per day for a portion of the unbuilt spots, which Lindsay said could total $2.2 million per year.

Depending upon whether those parking spaces are underground, the public could be handing over hundreds of millions of dollars for their construction. This is in addition to Infrastructure Ontario's Michael Lindsay's admission "that provincial taxpayers have so far spent “hundreds of millions” of dollars on site servicing to get all of Ontario Place ready for redevelopment."

But, not to worry, the government insists, because the economic benefits will be astronomical. 

Benefits of the redevelopment plan, Infrastructure Ontario said in briefing documents, “include, at a minimum, nearly $2 billion in estimated revenue contributions from Therme Canada to the province over the duration of the lease and $700 million in upfront capital investments from Therme Canada.

However, like many of the claims by the Ford coterie, these revenue projections are based, to put it politely, on wildly enthusiastic (i.e., wholly unrealistic) expectations. 

The province says it expects the revitalized Ontario Place to attract more annual visitors than the CN Tower and Empire State Building combined, a estimation that some experts are questioning. 

On Thursday, the province revealed it expects 6 million visitors annually at the site, which includes the waterpark and spa being developed by Therme Canada, a concert venue, the new science centre, a new marina and public park land. The estimation was made public when the province revealed its lease with Therme. 

By comparison, the CN Tower sees about 1.8 million visitors a year and the Empire State Building 2.5 million. The six million visitor figure would put Ontario Place closer to Eiffel Tower-level tourism, which sees just under seven million visitors a year.

But Wayne Smith, a hospitality expert from Toronto Metropolitan University,  is rightly dubious of this number:

"But you know when you take a look at that and, we did the numbers, six million guests a year would be almost 16,500 people a day. That's a lot of people."

However, there is one bright spot in the midst of this fiscal morass. The lease with Therme  prohibits one of Ford's passion projects: a waterfront casino.

When you live in Doug Ford's Ontario, you look for victories, however minuscule, wherever you can find them.

 

 

UPDATED: A Private Sector Addiction

 

I often wonder how many Ontarians realize that we are led by a premier addicted ideologically to the private sector. A man hobbled by a limited education and intellectual breadth, Doug Ford's paltry vision is one that extols all things private at the literal expense of the public. The signs are many.

One need only look at the Greenbelt Scandal, that, before it was stopped, was designed to rob citizens of necessary and valuable green space, wetlands and nature in general so that Doug Ford's developer friends could benefit to the tune of many billions of dollars. There is also the 'redevelopment' of Ontario Place handed over to a German company, Therme, to build a spa for the minority of people who will be able to visit it. And nothing is too good for the private sector; in the case of Therme, they have been given not only a 95-year-lease (whose terms are being kept secret from the public), but also a wholly taxpayer-funded underground parking facility that will cost over $650 million, as well as other untold costs that will no doubt be uncovered in future Auditor-General reports,

I could go on, but the most recent proof of Ford's follies are reflected in his obsession with privatizing more alcohol sales, despite the billions in revenue the LCBO puts into public coffers. And now, as a result of his monomania, we have a strike at the LCBO, one I suspect will go on for some time. It is going all according to plan.

The longer the strike goes on, the more opportunities thirsty Ontarians will have to discover new, private sector sources to slake their collective thirst. And as resentment grows over the LCBO's monopoly on liquor, fewer people will be concerned about the concerns that led to the strike - the protection of union jobs paying between $17 and $30 per hour, although apparently only 30% of those jobs are permanent and have benefits. Yet even that modest remuneration seems too much for Doug, because it is not going to the private sector.

Robert Kahnert of Markham, Ontario, offers his thoughts on the damage Ford's approach to policy is doing to this province:

What happened to our once civil society? We now live in an Ontario no one recognizes. Everywhere you look there is a crisis — homelessness, affordability, health care, education, building and infrastructure decay.

How did things that were once so good get so bad.? The answer is right in front of us. Most of the public wealth was transferred to the wealthy.  We have been fed a steady diet of tax cuts, deregulation,  and the need for privatization to get the “innovation and private sector efficiencies” with promises like “all boats will be lifted by the rising economy.” As we have clearly seen, false promises. Not only has our civil society been severely damaged but so had trust in democracy .

In the last provincial election, only 17 per cent of the population voted for Premier Doug Ford.  After slashing government funding to public services  starving them into crisis just to pay for tax cuts to the wealthy and their corporations, they then present privatization as the solution to a problem they created. The only thing deregulation and privatization does is create more profit-making opportunities.

The gap between the haves and have-nots is huge and widening at an ever-increasing rate.

 Small tax cuts to the general population have been used as a cover for massive tax cuts to the wealthy and their corporations.

 Reversing tax cuts is not raising taxes, it is restoring revenue to rebuild our once civil society. Beware any politician promising tax cuts. We do not have a wealth creation problem. We do have a very serious distribution of wealth problem.

Where is the leadership? We have the power. Don’t leave, speak up and vote to stop this insanity.

Paul Kahnert, Markham

Worshipping at the altar of unrestricted free enterprise comes with great costs. It is time that more of us realize the extensive damage such fealty does to the things we hold in common, and act to stop any further erosion of our services, values and culture that seem so foreign only to those who 'serve' us.

UPDATE: If you're still with me, Brittlestar has an entertaining but accurate video about the importance of the LCBO to Ontario's development:

Shiny New Things

 

Despite our professed admiration for things that have withstood the test of time (heritage buildings, old literature and traditional values come to mind), it is undeniable that there is much allure to be found in the new as well. We marvel at innovative architecture, science and engineering, to name but three. And that is often all to the good; otherwise we would simply be mired in the past. 

However,  sometimes we can be blinded by the sheen of shiny new things and fail to appreciate the many costs that accrue in throwing out the old and embracing the new.

Such is the case with the Doug Ford government's plan to redevelop Ontario Place in the image of a tawdry but expensive spa, a development that has both  profound financial (think $600 million taxpayers' dollars to build an underground parking lot), aesthetic and environmental costs. Many protests have occurred opposing this development, and now an insider has emerged to voice his concern.

A prominent landscape architect, known for designing Trillium and Tommy Thompson parks, has walked away from the redevelopment of Ontario Place, citing his opposition to clearing hundreds of trees to make way for a private spa and waterpark on Toronto’s waterfront.

After it became clear he couldn’t influence plans from the inside, Walter Kehm told the Star he could no longer be tied to a project that threatens a decades-old wildlife habitat, likening his professional commitment to protect nature to a doctor’s Hippocratic oath: “Do no harm.”

Earlier this fall, the former director of the University of Guelph’s school of landscape architecture resigned as a senior principal at Toronto-based LANDinc, one of two firms under contract to help design and construct the “public realm” of Ontario Place.

Kehm voices concern about the less-obvious destruction involved in this construction.

In more than half a century, “the 800 trees on the West Island have developed their own ecological niche,” he said. “We’re talking about more than the trees. We’re talking about a home for all the species that live there.”

Refreshingly, this expert  is able to consider something other than the bottom line.

Kehm said he had repeatedly advocated to preserve the trees on the West Island, as part of his broader vision for a forested Toronto waterfront, including during a meeting near the end of last summer.

The “big vision” for Toronto’s waterfront that Kehm had fought for, one he’s dubbed the “Emerald Necklace,” takes inspiration from a connected chain of parks that runs through Boston.

In the midst of a mental health crisis — on top of a changing climate — he stressed the importance of not only protecting “urban forests,” such as the one found on West Island, but also creating more opportunities for Torontonians to harness nature’s therapeutic benefits. 

In the world of quick profits and secret, sleazy backroom deals that characterize the Ford government, a public expression of integrity is both rare and welcome. I therefore leave the final world to Kehm:

“Nature is calming for the soul,” he reasoned. “You don’t need a spa for that. You need trees.”