Winnipeg Free Press - PRINT EDITION

A storm is gathering over the upscale house of Katz

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When it comes to self-preservation, there are few politicians better than Mayor Sam Katz.

Katz has an innate ability to take the hefty rocks thrown at him by his critics and, with the use of obfuscation and unshakable confidence, slice them down until they are little more than specks of dust. Honestly, he is one tough nut to crack.

That said, there are signs Katz is losing his touch. Perhaps the rocks are getting bigger or more numerous. Either way, more and more of them are getting through and leaving welts.

Thursday's council meeting is a prime case in point. Interest in city hall's weekly gathering was keen, as Katz was expected to face reporters on several growing controversies. One has to do with demands for a broad-based audit of the city's real estate transactions in the wake of a controversial land-swap deal that saw a new fire-paramedic station built on private land owned by Shindico Realty. The second involved new revelations that Katz acquired a million-dollar Phoenix home from the sister-in-law of prominent local developer Sandy Shindleman, owner of the aforementioned Shindico.

At one time, just weeks ago, a motion for a broad audit of real estate transactions would have been destined to fail as councillors loyal to the mayor would have starved it of support. This time, however, they all spoke at length of how troubled they were about the state of the city's real estate dealings. Make no mistake, this was a deathbed conversion by Katz loyalists who have heard the growing furor over these deals and are rushing to get to the right side of the issue.

Few will come out and say it, but the unofficial focus of the audit is Shindleman's relationship with Katz. There is little doubt the push for this new audit is an attempt to explain how and why Shindico has been able to involve itself in such a large chunk of the city's real estate transactions. And how, if at all, Katz was involved in helping that happen.

It is an unavoidable fact that when you look at many of the controversial deals that pushed council to take this extraordinary measure, Shindico was involved in all of them -- the sale of a city-owned parkade at Portage and Main, the infamous Parcel Four waterpark deal at the Forks, the fire-paramedic station land swap.

Few will name Shindleman as the primary target of the audit, but it's clear he is in the crosshairs of this process.

Where does that leave Katz? It's no secret the two are close. Katz acknowledged Shindleman and his brother, Robert, are his partners in the ownership of the Winnipeg Goldeyes baseball team. But it is becoming more and more obvious that is not the extent of the relationship between the two men. Katz's purchase of a million-dollar Phoenix home from Teri Nordstrom, Shindleman's sister-in-law, further cements the idea the relationship is much deeper than either has admitted. That raises even more red flags about the mayor's decision to vote on numerous land deals involving Shindleman.

And what of this latest transaction? Katz said the home was purchased at "fair market value" from Nordstrom. There is no purchase price listed in the legal documents on the sale and no mortgage registered against the property. When asked where he would get $1 million, Katz said he had been "blessed in business."

It is not clear the audit's findings will do anything more to clarify the Shindleman-Katz relationship. But with both these stories running side by side now, the mayor has much less room to wiggle. It has forced him to vote in support of the audit of real estate transactions, even though he spent weeks resisting it. He supported the audit knowing much of that work will focus on Shindleman at the same time as new revelations show a deeper and more complex business relationship.

Katz has been very successful at confusing and frustrating his critics by making confident but factually flawed arguments in his own defence and by not giving ground, no matter how hard people come at him. But now, more than ever, we can see how two-dimensional his logic is.

In Katz's world, there is no financial gain when he acquires a company without having to pay thousands of dollars in legal fees. Acquiring a home from the sister-in-law of a major Winnipeg developer who is involved in millions of dollars of city business is not a conflict of interest because it happened in Arizona. And continually voting on deals involving past business partners is not a conflict because, well, he wasn't in business with them at the time of the vote.

Those assertions didn't quite pass the smell test for many. But Katz was very successful in dampening the voices of his critics with charm and charisma and the complexity of the allegations. Eventually, he was so successful at slicing up his critics, you couldn't hear them anymore.

Unfortunately for the mayor, we're having no trouble hearing now.

Republished from the Winnipeg Free Press print edition September 28, 2012 A5

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