Now, Katz says swap 'doesn't make sense'

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COLE BREILAND / WINNIPEG FREE PRESS ARCHIVES New fire-paramedic Station 12 sits on Shindico Realty land.

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In the space of 15 days, Mayor Sam Katz has gone from defending Winnipeg's proposed three-for-one land swap to ordering a review of the deal to declaring a key aspect of the plan doesn't make sense.

On Wednesday, Katz issued his strongest condemnation yet of a heavily criticized plan to exchange two old fire halls and 0.4 of a hectare of vacant city land for the Taylor Avenue site of the new fire-paramedic Station No. 12. The site is owned by Shindico Realty.

"The real problem that I see in the station -- there could be many -- (is) the fact we have built a fire-paramedic station on a piece of land we don't own," the mayor told reporters outside his office.

"It doesn't make any sense. There's no way that I would define that as good business. It's not. I don't think anyone can defend that."

After the deal first came to light in August, Katz said criticism of the proposal was premature. At the time, he said city staff would issue a report recommending council either approve the swap or purchase the Taylor land from Shindico.

A week later, Katz ordered what he described at the time as a financial review of the deal to ensure it made sense for taxpayers. He initially said he ordered chief financial officer Mike Ruta to crunch the numbers, with the assistance of chief administrative officer Phil Sheegl.

That review now involves both the financial aspects of the proposal and the processes that led to the deal, Katz revealed Wednesday, adding the city auditor is involved and external appraisers will be employed to provide independent valuations of all four properties in question.

"I can tell you (Ruta) has reported to me he has requested the auditor to assist him with part of it. He is also seeking some outside, third-party assistance," said the mayor, referring to external appraisers he expects to come up with valuations based on the period the deal was negotiated.

Winnipeg Fire Paramedic Chief Reid Douglas put together the deal with the help of Winnipeg's real estate division.

A majority of city council has complained of being left in the dark about the deal, which is one component of a $15.3-million plan to build four new fire-paramedic stations in Winnipeg.

Shindico won four separate contracts to build new stations -- in Sage Creek, River Heights, St. James and Charleswood -- without council oversight, as projects under $10 million do not require council approval.

Katz said he expects Ruta to complete a review of the entire program within the next 10 days.

The mayor said he would like to see the report before the Sept. 27 city council meeting, but wants it to be thorough.

"We don't want any second-guessing, where they rush and make a mistake," Katz said.

The mayor said Ruta's review must be completed before he even considers further measures.

St. Boniface Coun. Dan Vandal has called for an external review of the land swap. Fort Rouge Coun. Jenny Gerbasi has been calling for a broader audit of Winnipeg real estate since May, when council effectively defeated a plan to sell city land near The Forks to an Alberta hotelier.

The mayor said if the entire land-swap proposal falls apart, the city's last recourse to acquire the Taylor Avenue land would be expropriation.

But he warned that would cost more money than a purchase price, as the expropriation process also involves legal fees and other costs.

bartley.kives@freepress.mb.ca

Feeling the heat

Mayor Sam Katz's evolving positions on the fire-hall land swap.

"Everyone knew the properties were going to be sold .... What will happen is the department will determine the value of one piece of property and then the value of other pieces of property. If they decide not to swap the land, then they just buy the land."

- Winnipeg Mayor Sam Katz on Aug. 28, 2012, insisting it would be premature to criticize a proposal to exchange two old fire halls and a parcel of Fort Rouge land for the Taylor Avenue site of the new fire-paramedic Station No. 12, built on land owned by Shindico Realty.

"There are still some things that in my opinion are not 100-per-cent clear ... I need to know, and I think everybody needs to know, what taxpayers are getting for their dollar,"

- Katz on Sept. 4, as he announced a review of the proposed land swap.

"It doesn't make any sense. There's no way that I would define that as good business. It's not. I don't think anyone can defend that."

- Katz on Sept. 12, referring to building a fire-paramedic station on privately owned land.

Republished from the Winnipeg Free Press print edition September 13, 2012 A5