Toronto’s public housing agency will impose new rules for executives and staff buying condo units in Regent Park and all future redevelopments following a conflict-of -interest investigation.
The investigation by a former chief justice of Ontario, Patrick LeSage, was released Friday and found no wrong-doing in the case of two former executives and two staff who in 2009 bought units on the open market in the first phase of the Regent Park revitalization. At the same time, its findings recommend that all future investments by Toronto Community Housing Corp. employees be publicly disclosed to address any “appearance” of conflict.
“Greater transparency always assists in answering legitimate questions about possible and potential conflicts,” the report said.
TCHC board members and the new CEO, Gene Jones, were quick to endorse the measures, pledging to have a registry and a set of guidelines in place before the next building goes on the market this fall. The new rules, they said, would likely include additional measures such as limits on the percentage of new units sold to staff.
Mr. Jones, who arrived at TCHC this spring with a record of turnarounds at U.S. housing agencies, characterized the staff investments as an endorsement of TCHC’s efforts to create a new neighbourhood with a mix of incomes. “It shows that we believe in our product,” he said. “If I own Frito Lay, I want my employees to eat Frito Lay products.”
Board chair Bud Purves agreed, but said he’d also like to take steps to encourage staff to occupy the units they purchase. “I’d love to see them living there. That is something we are going to have to look at,” said Mr. Purves, part of a new board brought in to clean house following a series of spending scandals at the housing agency.
Mr. Purves, who told reporters he believes there was an “appearance” of conflict, said the report cost the cash-strapped agency $125,000, but was necessary to address public concerns.
Toronto councillor Frances Nunziata, also a TCHC board member, said the study was needed so that the troubled agency could move on and focus on providing housing and maintaining buildings. Despite its findings, she said still she does not support allowing executives to invest in future condo projects.
The conflict-of-interest investigation began in March following a series of reports in the Toronto Sun that revealed several people involved in the Regent Park redevelopment also had purchased condos in One Cole, the first building to come on the market. Those individuals included former TCHC CEO Derek Ballantyne and CFO Gordon Chu. Three executives of Daniels Corp., TCHC’s partner in the development, and councillor Pam McConnell, who represents Regent Park’s east-end ward, also bought units, the paper found. The transactions were reviewed by the city’s integrity commissioner before they took place.
The LeSage report focuses on the TCHC executives and two unnamed staff described by Mr. Purves as “mid-level” employees, and finds that they received no preferential benefits. It finds the incentive provided to Daniels executives and employees was covered by the developer and did not adversely affect TCHC profits on the joint venture.
Mr. Ballantyne responded to the findings, saying in a statement he welcomed “the confirmation that my purchase of a condominium unit at One Cole did not give me any benefit or advantage whatsoever and that any allegations of a conflict of interest on my part are unfounded.”
Mr. Jones said he will apply the lessons learned during the first phase of revitalization at Regent Park to future developments there and to the agency’s next major project at Lawrence Heights.
“Staff cut their teeth on Regent Park,” he said, noting that any problems should not diminish the accomplishments of the project. “I have been in this business for 30 years and I have never seen anything like Regent Park,” he said.
The second phase of the project, with 365 units, is scheduled to go to market in October.