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George Foulidis, left, owner of Boardwalk cafe, speaks with Martin Gladstone, candidate for city council, today.

Rita Smith/Rita Smith

For months, George Foulidis's Boardwalk Pub has been mired in election-season controversy.

Two council candidates have ripped into a city lease agreement that extends his monopoly to 2028, while mayoral candidate Rob Ford has lambasted the deal as "corrupt," without providing any evidence of wrongdoing.

On Sunday, a fed-up Mr. Foulidis lashed out at Martin Gladstone, a candidate for Ward 32 Beaches-East York who called a news conference in front of the pub to reveal the contents of the 83-page lease, which he'd obtained through a Freedom of Information request.

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"You're running for office?" Mr. Foulidis snapped.

"That's not the issue," replied Mr. Gladstone, a lawyer and activist.

"You're trying to cause a commotion against the incumbent councillor? Is that all this is about?" Mr. Foulidis asked.

"You don't agree the taxpayers deserve better?" Mr. Gladstone shot back.

Eventually, Mr. Foulidis walked inside, shouting as he retreated: "I will fix this building up when I have to fix it up, when my contract conditions are met the way I want and not under your scrutiny, thank you."

In his summary of the lease, Mr. Gladstone said the deal was full of irregularities, including quarterly rent payments instead of monthly; no security deposit and no requirement that last month's rent be paid upfront.

But Mr. Gladstone trumpeted a key finding that wasn't new at all. It has been publicly known for months that the base rent over the life of the lease is 20-per-cent lower than what Mr. Foulidis first offered and what council approved back in 2007.

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That works out to $1-million less than the original offer over the life of the lease.

The rent was discussed in open session at council and, according to Mr. Foulidis and a recent city staff briefing note, the figures have been twisted by critics of the arrangement.

Although Mr. Foulidis is paying $1-million less than what he offered in 2006, he's actually paying $2,184,400 more over the 20-year life of his lease than he did over his previous 20-year term, says the briefing note prepared for councillors and dated Aug. 3, 2010.

"There's a human side to all this, too," Mr. Foulidis said in an interview, calling the attacks on his family business, Tuggs Inc., "hurtful."

The saga that led to Sunday's verbal tussle began in 2006, when Toronto city councillors voted at their final meeting before the election to extend Tuggs Inc.'s monopoly beyond its September, 2007, expiry date.

Earlier in 2006, Mr. Foulidis, who has operated the Boardwalk Pub and two concession stands at Kew Gardens and D.D. Summerville Pool on city-owned beachfront land since 1986, approached the municipal government with a lease proposal that included base rent of $250,000 per year and unlimited sponsorship rights on most of the Eastern Beaches.

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City staff recommended competitive bids. However, council rejected staff's advice at the urging of Councillor Sandra Bussin, who praised Tuggs Inc., as a bulwark against corporate fast-food chains invading the Beaches.

Fast forward four years to this spring and city staff finally reached a tentative deal with Mr. Foulidis - a deal with sweetened terms including the right to hawk merchandise on the boardwalk, sell booze in Ashbridge's Bay Park and pay $50,000 less in annual rent than Mr. Foulidis's original offer.

However, city staff eventually rejected Mr. Foulidis's proposal to erect an unlimited number of sponsorship and advertising signs, which persuaded parties to settle on the lower rent rate.

In May, council voted 15 to 13 in favour of the deal; Ms. Bussin recused herself from the debate and vote. An attempt at the June council meeting to re-open the matter failed.

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