Friday, February 05, 2016

Old Nanaimo Hall City Annex - Tax Dollars Lost?

City gives away $4 million building in 2012
New owner still not paying any taxes

Regular readers of this blog will know that the saga surrounding the old and new city annexes are a prime example of wasted tax dollars. Previous senior management and two Council's on John Ruttan's watch arguably set fire to several million tax dollars under the guise of 'safety' and concern about the outcome from a seismic event.

At least $16,000,000 went into the new annex (now called the SARC) building, which arguably was only needed because senior staff of the day wanted a new playpen. The old annex on Franklyn Street had it's value completely gutted by attaching a covenant requiring demolition or a seismic upgrade. This upgrade would not have been required under the building code and I suspect this was put in place to avoid any possible embarrassment should a new owner come along and a new engineers report debunk the 'safety' issue. Remember the city did have an engineer tell us how dangerous the Colliery dam was, only to later find out, that was not accurate. Could another look at the old annex have disproven the first report?

The $4,000,000 Giveaway

In 2012 it was announced by the City, that the old annex at 238 Franklyn Street was being sold to a company called Tectonica for the sum of $2. There was however a condition attached to that sale. The company would have to either demolish the structure or undertake a seismic upgrade within 2 years, or the property could revert to the city. The actual 2 year clock did not start running until 2014 however, meaning Tectonica was to have fulfilled their part of the deal by January of this year or the property could revert back to city taxpayers.

It turns out, that in October of last year, at one of those secret in-camera meetings, this new council extended the time for the upgrade for another 5 years. It will likely require an FOI request to determine exactly why this extension was granted in-camera and why until now there has been no public disclosure of that secret deal.

No Taxes Being Paid

My attention was drawn to this whole affair when I noticed that BC Assessment was only assessing this land and building at $2, given a similar lot nearby had an assessed value of over $600,000.00 for land only. I noticed this last year and told the city, thinking they would ask BC Assessment to put a proper evaluation on the property, so the taxes could be collected.

I contacted the city for clarification on the assessment and then became aware of this in-camera deal. Arguably this is not a good deal for the Nanaimo taxpayer. It is however a very good deal for Tectonica and Mr. Darren Moss. They apparently have a 5 year option to purchase agreement, on a valuable piece of property, on which they pay no taxes, and forfeit nothing if they don't perform.

BC Assessment explained to the city that because the city had put a covenant on the property that the building could not be used until upgraded that they valued the entire package at $2.00. I am still waiting for someone from BC Assessment to explain why this makes the land of no value. If not using the land makes it of no value, then there should be no assessed value on vacant land, by the same logic.

A Good Deal For Taxpayers

If this council had the taxpayers interest truly at heart, they would take possession of the property. Remove the covenant, and put the property on the market and try and salvage some of those tax dollars council's have so carelessly thrown away.



  1. Does this Council even understand openess, transparency and fiduciary responsibility to the taxpayers beyond catch phrases and communications "Spin"? How can they change a public deal in a secret meeting with no oversight or disclosure whatsoever?

  2. They still haven't come clean and told the public who voted for this in the first place. They spent $16m of our money in a secret vote and still haven't disclosed it. What are sitting Councillor's hiding

  3. Do city staff have degrees in finance? Possibly degrees in common sense should be a prerequisite for these positions.

  4. Why would a vote to spend significant taxpayer monies still be kept secret behind closed doors? What happened to " the public's right to know the public's business? Who benefits by keeping us in the dark?

  5. Why would a vote to spend significant taxpayer monies still be kept secret behind closed doors? What happened to " the public's right to know the public's business? Who benefits by keeping us in the dark?

  6. There's a better view from the new $16-million building!


  7. Wow this is unbelievable. This Council is out of touch. Did they not run for their positions on how they would be more open and transparent? Curious how this is not a topic on any of the various Nanaimo Facebook Pages. I can only imagine why!

  8. Opened and Transparency with this Council is only something to be said to get elected.


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