Brampton councillors raise red flags after man with ties to Patrick Brown handed consultant’s job for proposed Municipal Development Corporation
On New Year’s Day in 2018, the City of Toronto launched a venture to organize its vast real estate portfolio. CreateTO was established to govern the City’s 8,000 real estate properties, managing them to bring the greatest value to the municipality and its residents.
Just months before, the City of Brampton was looking into a similar venture, which aimed to manage tens of millions of dollars in assets, sell off excess land no longer of use and purchase property to address the pressing needs of Canada’s fastest growing large city. The idea of a Municipal Development Corporation (MDC) similar to Toronto’s was hatched, marking the start of a three-year process that will likely soon conclude.
MDCs, such as CreateTO, are not part of council, but an external organization that stands separate from the municipality in which it operates.
In August of 2020, a business plan put together by a third-party consultant, the Menes Company (MenesCo), and brought to council outlined two options for the City. The first, labelled as the one preferred by the consultant, would allow the MDC to manage all of the City’s realty services, much like the MDC set up in Toronto.
The alternative option limits the MDC’s focus to six communities that are outlined in the Brampton 2040 Vision, a document that details future growth plans for the city. These areas include Uptown, Downtown, Bramalea, Queen Boulevard, Industrial Corridors and the five Town Centres.
Under one proposal for a new MDC only these areas of growth would be the focus.
Brett Bell, the director of MenesCo, told The Pointer his report’s scope was limited to “proposing and receiving feedback to how an MDC will operate”, outlining aspects such as the organizational structure and Board of Directors (BOD).
Consulting over the years
Bell’s consulting company was not the one that worked on the proposal initially. Under the previous council, the project concept was being developed by N. Barry Lyon Consultants, a company that has operated for five decades.
It was tasked with exploring the prospects of an MDC in the city. Its findings concluded “significant potential” for a successful MDC existed, but further work was needed before the City established the corporation, a staff report, based on the consultant’s findings and presented at the December 11, 2019 Committee of Council meeting, outlined.
At that same meeting, council gave the CAO’s office, which was handling the project, direction to engage another consultant to prepare a business work plan.
Patrick Brown has denied that Brampton CAO David Barrick was implicated in a fraudulent Niagara Region hiring process.
A brand new CAO had just been hired under the direction of Mayor Patrick Brown. David Barrick, a controversial figure with a checkered past from Niagara Region, and ties to Brown through conservative politics, was given the job despite having no experience running even a city department.
He had just been found by the Ontario Ombudsman to have colluded in an “Inside Job” hiring, along with two other Niagara bureaucrats who also now work for the City of Brampton. They had conspired behind the scenes in a fraudulent process to make sure the job search for a new Niagara Region CAO would result in the hiring of Barrick’s former boss at the local conservation authority.
When Brampton councillors found out about the scandal, after it was already widely reported, after the provincial Ombud had released his scathing investigation report into the fraudulent Niagara hiring process (aptly titled “Inside Job”) and after Brown had already led Brampton’s hiring process to select the tarnished former Port Colborne regional councillor to run the ninth largest city in Canada, some Brampton council members demanded answers.
Brown has denied that Barrick was implicated in the Niagara Region scandal, despite numerous news reports and the Ombud's investigation report.
To this day, Brown has not explained how Barrick was selected for the CAO job, and how the search firm hired under Brown’s watch could have recommended a man so clearly inexperienced who had been in the news for almost a year for his alarming conduct in Niagara.
By December of 2019, Barrick was occupying the City of Brampton’s CAO seat, and under his direction, MenesCo was hired as the new consultant for the plans to hand over the municipality’s real estate management to a semi-private development corporation.
It’s unclear why N. Barry Lyon Consultants, which had already done much of the MDC work and had a proven track record since the late ‘70s, was dropped in favour of a new company with no experience as a corporate entity.
Bell, the owner of MenesCo, hired directly under Barrick’s authority, also has a direct connection to Brown.
According to an October 2018 article in the Toronto Star outlining Brown’s 2018 mayoral win, the two have known each other for more than two decades.
The article quotes Bell as being a “long-time Conservative activist” who “has known Brown since his days as president of the PC Youth Federation.” Brown served as president during the late 90’s and early 2000’s. Bell spoke to the Star about what made Brown’s campaign successful and the challenges he would face going forward.
Bell confirmed to The Pointer he has known Brown for “many years through our mutual involvement in party politics,” but hasn’t spoken to Brown directly in two years. “To my knowledge, he had no involvement in the awarding of the project, nor did I speak to anyone in the Mayor's office. If we had a conflict we would certainly disclose it, but I don't believe there was one here.”
The timing of Bell’s hiring by Barrick to do the Brampton MDC consulting work, is also raising red flags.
His firm, MenesCo did not even exist when council, under Brown’s leadership, gave Barrick the authority in December of 2019 to hire a new consultant to come up with a plan for the handling of tens of millions of dollars worth of publicly owned real estate assets.
Bell confirmed with The Pointer that his company was incorporated on January 11, 2020.
Regional Councillors Martin Medeiros and Pat Fortini, and City Councillor Jeff Bowman told The Pointer they were not aware the company was incorporated a month after council’s resolution to hire a new consultant.
Fortini said the City typically doesn’t hire consultants unless they’ve been in business for five years.
Councillor Pat Fortini is sounding the alarm for the way the MDC proposal has been handled.
While the company is only a year old, Bell said he has been a consultant for 20 years and municipal government and stakeholder engagement is one of his areas of expertise. Prior to starting MenesCo, he was a vice president at Hill+Knowlton, a public affairs firm with offices around the world and deep ties to Conservative political parties in Canada. He said he led “municipal and engagement practices” for the organization’s Toronto office. It’s unclear how this qualifies him to handle complex consulting for the establishment of a large real estate management corporation handling a vast array of portfolios.
His plan, he said, was to be the sole owner of his new business venture but he soon realized in order to win work from a municipality, the company would need to be incorporated, as most agreements require this.
He told The Pointer he received a Request for Quotation (RFQ) from the City over email on Jan. 9, 2020. This detailed document outlines the specifications of a project and focuses heavily on costs.
It’s unclear why he received such a request and who at City Hall arranged to have Bell vie for the consulting job, despite not having an actual company of his own.
Two days after receiving the request to provide a quote, he incorporated his company.
This timeline is now raising questions.
Bell said the direct invitation to bid on work is a common occurrence, in addition to public tenders. The RFQ was accepted but he couldn’t speak with The Pointer about the bidding process the City went through, only stating it was the City’s internal selection process.
The Pointer asked the City how many companies applied to bid for the consulting work and what its associated cost was. The questions were not directly answered.
Upon examination of the city’s purchasing by-law, and given the procurement was through invitation, the project likely cost between $25,000 and $100,000.
When the project was initially presented in July 2017, the community services department was handling the management of the process.
It’s unclear why Barrick, after he was hired by the selection committee chaired by Brown, immediately took over the process.
In early 2020, the community services department’s former commissioner, Al Meneses, was let go from his position.
The Pointer asked the City when and why Barrick took this project over. The questions were not answered.
“The City of Brampton’s Purchasing Bylaw, approved in 2018, promotes procurement activities and decisions which are consistent with the strategic, financial, social and environmental objectives of the City; provide professional and ethical leadership through the provision of fair and transparent procurement processes; promote the most cost effective and efficient use of City funds by achieving best value for money; and maintain trust and confidence in the stewardship of public funds,” a City spokesperson wrote in an email.
The three councillors told The Pointer they are concerned about how Bell was hired and his ties to Brown.
Looking back at staff reports and agendas around the MDC process, The Pointer could not find any disclosure of their relationship.
Brown has held numerous positions in the political realm throughout the years, as a former Barrie councillor, and MP and an MPP before becoming mayor, and has likely met many different people, Medeiros said. But with all of the details presented together, it raises “red flags”.
Councillor Martin Medeiros, chair of Brampton's Planning Committee, says an MDC would not be accountable to the public.
“Let's be very clear. If all of a sudden, new consultant companies are being hired, and there's no history from them, then certainly staff have to answer this and, be it our CAO or whoever.”
Bell stressed to The Pointer he did not speak to anyone from the City about the bid before the process began, and he never would. “We are proud of the report we submitted and I have nothing to hide.”
But after getting the job and eventually submitting his recommendations, they raised even more red flags.
Bell’s business case outlines his proposed MDC Board Of Directors, with Brown occupying a seat, two councillors, four members of the community and Brampton’s Chief Administrative Officer, David Barrick, who would not have voting powers. It’s not clear why the CAO, who has no experience, would get a spot at the table overseeing real estate assets worth tens of millions of dollars. It’s also unclear why Brown would be given a guaranteed seat.
The Pointer sent questions to Brown. Gary Collins, the mayor’s director of communication, said Brown was not involved in the hiring process for an MDC consultant.
Is it needed?
Some members of council are wondering how useful such a corporation would be for the city.
Medeiros told The Pointer the idea is not feasible for Brampton’s smaller land size, compared to much larger cities like Toronto.
He cited a lack of examples which would justify such a corporation. In 2019, the city voted to demolish the Heritage Theatre and the surrounding buildings on the block, which are currently owned by the City. Prior to this decision, the City put the building up for sale to create space for other development opportunities.
“It wasn’t about the money,” Fortini told The Pointer, but about attracting businesses downtown.
He questions the timing of the MDC plan, saying it’s not right to focus on a project of this scale at this time. The arrival of the novel coronavirus is nearing the one-year mark, and people have been struggling. There are much more important issues to be dealt with at this time, Fortini said, such as the expansion of Peel Memorial, given the city’s dire need for adequate healthcare.
Medeiros, who chairs Brampton’s Planning Committee, questioned why the entire MDC process wouldn’t be handled internally through the City’s real estate division using existing plans, such as the asset management program the City developed in 2016. The purpose is to keep track of the assets the City owns, maintain them, and plan for how they can be managed in the long-term.
Internally, the process hasn’t been given its “due diligence”, he said, as all the options for land needed by the City haven’t been explored. He cited the need for a number of features the city needs, such as a conference centre, which currently doesn’t exist. The City will have to find space for a new university campus, if its ambitious plans come to fruition, and many other features are needed as the population continues to swell. He believes land for a convention centre could be dealt with internally and such a site would boost tourism. “There’s really no need at this point for a development corporation,” he said.
Bowman noted the City previously used to support a similar operation, The Brampton Downtown Development Corporation (BDDC), which did not work out. A review from a third party consultant in 2013 found numerous issues, including a lack of staff who specialized in real estate, planning and project management. Allegations of mismanagement were rampant and the group was disbanded in 2015, after political interference, partisan appointments and competing agendas became regular features of the dysfunctional arms-length agency.
Most municipalities don’t use real estate corporations, and Medeiros believes more real life examples are needed before the city proceeds. “For us to be the guinea pigs on the process in which not too many municipalities have currently, I think that we'd want to see other municipalities have this type of process, sit back, learn from them, and see what's the best value proposition.”
Regardless of what council decides to do, the governance structure of any future MDC, if one is formed, would include a board of directors, who would hire a CEO to lead the MDC and approve the corporation’s annual budget.
For Medeiros, the proposed make-up of the board doesn’t make sense. If there are only four members of the community and the rest are members of the City of Brampton, why can’t the entire function be handled by council, he questioned.
Councillor Fortini agreed. He questions whether the best interest of residents, including property taxpayers, would be protected if land sold by the City gets in the hands of a developer, fearing the use of a separate corporation would mean a loss of public control over publicly owned assets.
Both of them also expressed concern about accountability. As members of council who were voted in by residents, they are the ones responsible for managing assets and projects to use those assets, in the eyes of residents, and losing control over processes that could directly impact constituents is worrisome.
“I don't want to depend on a private agency to do anything or a private development corporation to [make] decisions for me,” Fortini said.
If a decision that’s seen as unfavourable to residents is made by the MDC, Medeiros said councillors can’t just raise their hands in the air and claim there’s nothing they can do because bad decisions came from an organization that’s out of their control. “That's something I won’t support.”
He said there’s a reason elected officials are given the responsibility to protect those who vote for them, and he questions what real accountability would exist to police a semi-private corporation.
Brampton CAO David Barrick would sit on the proposed MDC board.
Under the proposal, a chair and vice-chair would be nominated within the BOD, and would ultimately be approved by council. The chair would receive $25,000 in annual compensation, the vice-chair would get $15,000 and all members will receive $500 per meeting, the business plan states.
When The Pointer raised this with some councillors, they said they were not aware of any financial compensation attached to the roles, and were surprised any money was associated with these positions at all.
Councillor Medeiros questioned why council members on the board, who would be doing the same work if it was part of council, would receive extra pay. “To me, things don’t smell right,” he said.
Councillors who sit on or lead the committees under City and Regional Council do not get extra pay for doing so.
A document detailing the MDC process outlines public consultations that took place. The makeup of the board was a concern among residents. “A board of directors filled with members of council and the CAO does not sound independent,” a comment by a member of the public in the report states. It says the number of elected officials to be named to the BOD would ultimately be up to council’s discretion.
This document also states the problems around the failed BDDC were considered, and suggests an annual report be presented to council, to ensure things remain transparent. This report would include a financial audit, progress on the six areas of development and performance indicators.
Only 397 people were part of the public consultation, a fraction of the city’s population of 656,000. The document acknowledges the current challenges brought on by the novel coronavirus and outlined the methods in which residents were informed about the consultation, including a survey and webinar. The public consultation period began on November 4 and ended December 2. For councillors, this wasn’t the right time given the ongoing pandemic.
A second group within the proposed MDC structure would involve a management team, including the CEO, project managers and planners, legal counsel and professionals part of the real estate industry. The chair of the board would be responsible for hiring the CEO and the board would be responsible for determining a salary.
It’s unclear why Bell’s proposal recommends the chair select a CEO, as this places immense control in one person’s hands. It is not a typical approach and again raises questions about how qualified Bell is to shape the process.
A third category of steering committees would be created. Based on the six projects the document outlines as part of the Brampton 2040 Vision, there will be six steering groups involving a member from the BOD, the CEO, a project manager, appropriate city staff, and up to seven community members. The BOD would be the only group compensated for their time.
While the organization would initially need assistance from the City, including funding and office space, it’s expected to become self-sufficient as real estate transactions begin to generate revenues.
There are many unanswered questions about how these revenues would be managed and how taxpayers would be protected by proper financial controls to ensure no fraud takes place.
The Province’s role
Not specific to the MDC process, councillors shared their concerns about the lack of oversight by external groups, such as the provincial government, to ensure projects within the municipality are done with full transparency.
Medeiros said if the provincial government looked at some of the projects the city works on and offered scrutiny, it would be something he would welcome. He did not specify which projects.
“I think it's only healthier for democracy. It's healthier for our system where you have a provincial government with rules and regulations that exercises its oversight under legislation.”
Fortini would like to see such oversight as well, with stronger regulations for municipal transactions, instead of the provincial government vowing, when things go wrong in the municipal sector, that problems won’t happen again.
He cited the 2017 provincial ombudsman investigation that looked into the City’s procurement practices. The investigation was conducted after questions were raised about the way contracts were given to vendors. Prior to 2014, when Susan Fennell was mayor, the City spent millions on sole-sourced contracts, without following proper competitive bidding processes to award jobs. It was a blatant disregard for the taxpayer. The provincial investigation did not implicate anyone but it led to a number of suggestions for improvement.
Fortini said he was interviewed along with other councillors by the ombud at the time. When he asked what was going to happen with the information found, he was told they would make sure it didn’t happen again. “That doesn't work because it's like me robbing a bank. You catch me and say ‘make sure you don't do it again’. What’s the sense of wasting everyone’s time?”
Councillor Charmaine Williams told The Pointer in an email that if the MDC goes forward, “It is my hope that the governance of the MDC is designed in a way that the voices of Brampton residents are heard and woven into each of the corporation’s decisions and activities.”
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