Winnipeg Free Press - PRINT EDITION

Councillor airs his secret Shindico talks

Trying for deal on Taylor land

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The Shindico expropriation issue became more muddled Wednesday after St. Norbert Coun. Justin Swandel announced on the floor of council he was secretly negotiating a settlement with the developer that could have avoided the dispute going to expropriation.

The announcement caught many councillors by surprise, who questioned who authorized Swandel's involvement in the controversy.

"I was in the middle of negotiating what I thought was a fair deal," Swandel said as he explained why he opposed taking Shindico to expropriation. "I was pretty close to getting a deal done for around $1.5 million."

Council approved an administrative recommendation to take Shindico to the expropriation process over the firm's Taylor Avenue land where it built the new No. 12 fire-paramedic station.

The two sides had been negotiating for 14 months -- after council quashed a covert land swap the administration had arranged with Shindico and after construction had already begun on the fire hall.

While they were close on the price for the land -- the city offered a little more than $1 million and Shindico valued it at $1.2 million -- the city would not accept Shindico's term that it be paid an additional $844,000 for what it claimed was a loss in value of its adjacent property due to the new fire-paramedic station.

Coun. Ross Eadie said Swandel's announcement was "astonishing."

"I just heard a concerning issue about somebody negotiating a deal on behalf of the city who I don't think was appointed through the executive policy committee," Eadie (Mynarski) said. "I find that very disconcerting.

"I think some evaluation (is needed) of how a city councillor is in the middle of negotiating something that has been a hot topic throughout the city for the last two years."

"I don't understand why a member of council is off doing a separate negotiation and what process that is," Coun. Jenny Gerbasi said. "One member of council can go off and be negotiating -- our staff should be negotiating."

The Taylor fire hall was one of four new fire halls Shindico was contracted to build in a program that was several million dollars over budget and which a team of forensic auditors from consulting firm Ernst & Young concluded was mismanaged by city officials and plagued by unfair contract awards to Shindico.

Shindico has disputed the E & Y findings, arguing the firm offered the city the lowest possible price. Shindico officials did not respond to a Free Press request for an interview, but the company previously said it would not discuss the Taylor negotiations. Shindico declined to comment on its negotiations with Swandel.

Swandel's involvement in the negotiations is even more surprising, given he is the only member of council who publicly disputed the findings of the E & Y audit and repeatedly defended the actions of the administration throughout the process.

Shindico originally offered the Taylor property to the city in 2010 for $900,000 but withdrew the cash offer and stated it preferred a land swap, which the administration agreed to until council found out about it in August 2012 and stopped it.

Coun. Jeff Browaty, who chairs the property and development committee that is responsible for the Shindico issue, said he was unaware Swandel had been negotiating with Shindico.

"I was surprised" by Swandel's action, Browaty said. "I didn't know he was doing this. Given the sensitivity of the issue, I wouldn't have gone there."

Browaty said Swandel wasn't negotiating a purchase of the Taylor land but terms for a 30-year lease, which he wasn't prepared to support.

The only member of council who said he wasn't surprised by Swandel's revelation was Mayor Sam Katz, who claimed several councillors were aware of what Swandel was doing.

Katz said Swandel approached Shindico only after the administration said talks had broken down, adding Swandel wasn't negotiating with the developer but only talking to them.

"He was discussing if there were other options that we could come to some satisfactory agreement, as opposed to the expropriation," Katz told reporters after the council meeting.

Katz said it was Browaty who decided to support the administration's recommendation for expropriation and bring the matter to council.

Katz said he agreed with Swandel's assertion the expropriation process could eventually cost the city $3 million, adding he hoped both sides can still negotiate a settlement.

Is Justin Swandel's secret negotiations an example of problem solving or a sign of deeper problems at City Hall? Join the conversation in the comments below.

Republished from the Winnipeg Free Press print edition February 27, 2014 A4


Updated on Thursday, February 27, 2014 at 6:46 AM CST: Adds question for discussion

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