Process around Ontario Place redevelopment was 'unfair' and didn't follow rules: AG

AG report spurs calls to cancel Ontario Place deal The auditor general's report into 'unfair' practices surrounding the Ontario Place deal has prompted calls to cancel the deal.

Ontario’s auditor general is slamming the Ford government for failing to follow proper process around the redevelopment of Ontario Place, including a revelation that senior staff communicated directly with Therme Canada and other applicants while proposals were still being accepted.

Auditor General Shelley Spence’s assessment of the project was laid out in her report tabled at Queen’s Park Wednesday.

Ontario Place cost estimates have soared

It found that cost estimates for the redevelopment of Ontario Place have ballooned to $2.2 billion since the call for development was issued. That’s five times the 2019 projection of $424 million. That increased estimate includes $700 million for the construction of a new Ontario Science Centre, $280 million for a parking structure, a $346.9 million increase in site-servicing costs and $500 million in public realm improvements.

The report notes that some of those costs could be even higher and the estimate does not include maintenance costs for the site.

The auditor reiterated that moving the science centre is now costlier than maintaining it at its current site, in part due to adding a basement with a loading dock and a connection between the pods.

A March 2023 business case estimated that maintaining the science centre at its current location would cost $1.304 billion over a 50-year period, compared to $1.047 billion for a new location at Ontario Place. However the cost of relocating the Science Centre has increased by nearly $400 million since that business case was completed, bringing the projected cost of the move to $1.44 billion.

Call for development process was unfair

The report found a number of problems with the process around the decisions for the site.

The auditor general found that the Ministry of Infrastructure and Infrastructure Ontario did not design and conduct the call for development process (CFD) in line with “best practices for large-scale, modern land-use development projects.”

The decisions around the CFD process “were not fair, transparent or accountable” to all participants as would be required by directives and best practices, the auditor found.

Despite published guidance that contact with government officials was prohibited during the open period, some participants were invited to meet with government officials and high-ranking political staff during the CFD open period, the auditor found. Furthermore, minutes of meetings with participants were not kept throughout the CFD process.

In particular, three participants attended meetings with staff from the minister’s office and the premier’s office in June and July 2019. Only later on in the period were all participants offered a meeting with premier’s office and the minister’s office.

“We found a vice president at Infrastructure Ontario, responsible for conducting the financial assessments, communicated directly with Therme Canada (Therme) and other participants during the CFD open period,” the report states.

That communication included nine emails and one call with Therme’s legal counsel.

The scoring framework for submissions was not finalized until after the submission window had closed, and although some of the scores by individual assessors were very different, there were instances where scores were altered after consensus meetings.

Therme says it followed rules

In a statement responding to Spence’s report, Therme Group said they followed the established process in 2019, and were successful on the merits of their bid.

“The bid process was clear to us, and any questions we may have had were answered within the process prior to the close of the submissions deadline,” the statement read. “Therme Group followed IO’s process and fully complied with its requirements at every stage in our submission and negotiations.”

The group added “we are proud to have been selected to help revitalize Ontario Place.”

NDP Leader Marit Stiles slammed the Ford government in the wake of the report, saying it operates without regard for rules or transparency.

“This is a government that just rams through whatever they want and just do whatever they want with no consideration for the rules, for accountability, for transparency and frankly for what the data and science is trying to tell them,” Stiles told reporters after the report was released.

She said Infrastructure Minister Kinga Surma should step down or be fired over the process around the deal.

Process lacked public input

The report noted that public input was only sought in August 2021, after the tenants had been announced.

“We found that the social and environmental benefits and costs of redevelopment were not factored into the assessment framework or considered in the redevelopment, including in the lease negotiations with anchor tenants,” the auditor found.

Overall, the assessment process was “irregular, subjective and not always followed,” the auditor found.

The auditor issued 19 recommendations. The Ministry of Infrastructure accepted all of them, aside from one recommendation that it complete a Heritage Impact Assessment. The Ministry rejected that recommendation based on legislation passed to exempt the Ontario Place site from the Ontario Heritage Act.

The government had estimated that the new science centre could open in 2028. The report says that target has now been revised to 2029.