Toronto City Council demonstrates contempt for taxpayers

Anybody with even the slightest interest in Toronto City Council and the workings of this city is aware that City Council failed to tender the contract governing the Boardwalk lease concession – instead awarding the contract to Tuggs Restaurant. (This is part of a disturbing pattern of Toronto city council not tendering contracts that should be tendered.) As might be expected, many Toronto residents felt that the contract should have been sent out to tender. A tender would have ensured that other parties would have been able to bid on contract – a contract that essentially established a monopoly over commercial activity on the Boardwalk.

Why should contracts be tendered at all? The answer is simple:

to ensure that that the residents of Toronto get maximum return on city assets. This answer assumes that the mandate of City Council is to mange the City of Toronto for the benefit of Toronto residents.

That said,  its obvious that certain members of City Council don’t think it is necessary to tender at least certain contracts. If a contract is not tendered, then we cannot know what somebody else would have paid for the rights to the contract. Hence, without a tender, City Council cannot be assured that Toronto residents are getting maximum value for Toronto assets.  So then, why would Councillors ever fail to put a contract out to tender? It’s hard to resist the conclusion that Toronto City Councillors who vote against putting a contract to tender don’t believe their job is to protect the interests of Toronto taxpayers. Why would a Councillor not want to protect the interests of Toronto taxpayers? What could be more important to a Councillor than the interests of the taxpayers?

Tuggs Restaurant is in Ward 32 – Coucillor Sandra Bussin’s ward.  According to the papers, Sandra Bussin did not participate in the vote that awarded the contract to Tuggs without  tender. On the other hand, there is no evidence that Councillor Bussin encouraged putting the Tuggs lease out to tender.

Sandra Bussin, as Ward 32 Councillor,  should have taken the lead  in ensuring that the Tuggs contract went to tender.

At the end of day Toronto City Council did not serve the interests of the taxpayers because of its:

1. Failure to vote against awarding the contract to Tuggs without  tender; and

2. Failure to vote in favor of reopening the issue of the Tubbs contract.

Each Councillor who failed to protect the interests of the taxpayers, by allowing the Tuggs contract to be offered with tender,  should resign and should not run in the next election.


Council votes not to reopen Boardwalk Pub deal

June 09, 2010

David Rider and Paul Moloney

{{GA_Article.Images.Alttext$}}Three generations of the Foulidis family – John, Adonis, 13, and Danny – hang out at the Boardwalk Pub. The family company’s control of the restaurant and other concessions on the eastern beaches was assured when city council voted not to reopen a controversial 20-year renewal of its agreement with the city.


City council voted Wednesday not to revisit Tuggs Inc.’s controversial monopoly on food and vending rights on the eastern beaches, including the Boardwalk Pub.

The vote was 22-19, short of the two-thirds required to reopen the matter, despite concerns it could set a bad precedent if other businesses that lease city land seek similar deals.

City staff had recommended the concession be put up for bids, but council decided in a late-night vote last month to extend Tuggs’ existing lease for another 20 years.

The extension, opposed by some Beach residents, could lead to others asking for the same privilege, said Councillor Doug Holyday, chair of the audit committee. He has asked the city’s integrity commissioner to review the extension in light of city leasing policies.

“We’ve got a lot of real estate assets out there that are leased out,” he said. “I don’t want this to be the way the city does business. It all has to be done above-board.”

The city’s legal department, however, had warned that reopening the deal would risk a lawsuit, even though the city hadn’t yet signed the agreement.

“If council votes to re-open this matter and reject the revised proposal approved May 11 and 12, 2010, there will be legal implications,” states a confidential report obtained by the Star.

The lack of a city signature on the document doesn’t mean there is no agreement, the report says. “Tuggs has done everything required of it to be done and council has expressed its commitment to be bound by virtue of its decision on May 11 and 12. The actual signing of the agreement by the city’s signing officers may be considered a mere formality.”

The Foulidis family, which owns Tuggs, has argued it should get the lease renewal because of the money it spent on the buildings.

3 thoughts on “Toronto City Council demonstrates contempt for taxpayers

  1. votejohnrichardson Post author

    “Beach locked up for 20 years: Levy

    Did legal opinion from the city cinch vote on sole-sourced deal for boardwalk food and drinks?

    By SUE-ANN LEVY, Toronto Sun

    Last Updated: June 9, 2010 10:50pm

    There’s no doubt in my mind an 11th-hour legal opinion suggesting Tuggs Inc. could sue the city — even though no agreement has yet been signed — swayed enough councillors to opt not to re-open the controversial 20-year deal Wednesday.

    The vote was 22-19, but the motion needed two-thirds of the votes, or 28 councillors, to reconsider the deal to let Tuggs exclusively sell food, drink and more on the Eastern Beaches without the contract going out for competitive bids.

    Sandra Bussin, the ward councillor under fire over the deal and several other issues in her ward, left the Speaker’s chair for the vote, although Coun. Frances Nunziata told me Her Royal Speakerness was spotted hanging near the back door of the chamber throughout.

    It is unclear who asked for the legal opinion.

    However, it is bizarre. It states Tuggs Inc. has forwarded signed copies of the agreement to the city but the city itself “has not yet signed the agreement.”

    That notwithstanding, writes solicitor Jasmine Stein, “does not mean there is no agreement.”

    In fact, she writes, the actual signing by the city may be considered a “mere formality.”

    Stein indicates that in her opinion a “valid agreement” has been reached and to rescind it would constitute a “breach of contract.”

    “Tuggs could … seek damages against the City as a result of the breach of contract,” she writes, noting Tuggs Inc. could also argue significant profits will be lost “by virtue of the breach.”

    That’s all councillors needed to read. The deal to give Tuggs Inc. owner George Foulidis the exclusive rights to sell food and beverages at the Boardwalk Cafe, Kew Gardens and neighbouring Balmy Beach and at D.D. Summerville Pool for the next 20 years will go ahead.

    Once the deal is signed and sealed, he will also have a monopoly on liquor sales in Ashbridges Bay and Woodbine Park and will be able to sell trinkets throughout the entire Eastern Beaches.

    It was clear Bussin’s NDP pals were prepared to circle the wagons and support her. Never mind whether the deal is good for the city and for the Eastern Beaches — which it most definitely is not.

    Stein’s legal opinion, in my view, only leads to more questions.

    She makes no mention that the city has been negotiating with Foulidis for three years and has been unable to reach a deal with him. Or that the newly proposed terms would see him paying $1 million less in rent and $400,000 less in sponsorship revenue than Foulidis agreed to in 2007.

    There is no indication either that council already provided itself an out on May 12 by approving a plan to ask for bidders for the Beach contract if the deal was not executed by June 30.

    As a lawyer well versed in contract law told me it’s not a “done deal until it is a done deal,” and the legal opinion “makes a mockery of all contract law.”

    But I’m told Bussin, who received a combined $12,250 in donations from friends, family members, employees and officers of Foulidis’ company in 2003 and 2006, spent Wednesday morning lobbying councillors — instead of running council — into voting not to re-open the contract.

    Calls and e-mails to Bussin following the vote were not returned. Foulidis said in an e-mail he’s happy with council’s decision.

    Coun. Frances Nunziata, who moved the motion to re-open the deal, feels all the “arm-twisting and threats” by Bussin in the past day and a-half worked.

    “Until you sign on the dotted line, I don’t believe it’s a legal document,” she said. “But council has made a decision and we’re going to have live with this for 20 years.”

    Doug Holyday said after “eavesdropping” in on a phone conversation he had Wednesday morning in the area off of the council chamber, Bussin approached him, along with the city clerk and solicitor, and accused him of “divulging confidential information.”

    He denied doing so, later telling me he thought her actions a “blatant attempt” to deflect attention away from herself.

    Holyday intends to file an informal complaint with the Integrity Commissioner over Bussin’s handling of the deal.

    He has no doubt Bussin abused her power.

    “They (the NDP) think it’s their right to do that,” he said. “This can’t be the way city continues to do business.” Twitter: SueAnnLevy”

  2. votejohnrichardson Post author

    “Sandra Bussin, as Ward 32 Councillor, should have taken the lead to ensure that the Tuggs contract went to tender.

    City Council failed to serve the interests of the taxpayers because of its:

    1. Failure to vote against awarding the contract to Tuggs without tender;

    2. Failure to vote in favor of reopening the issue of the Tubbs contract.

    Each Councillor who failed to protect the interests of the taxpayers should resign and not run in the next election.

    The courts, not City Council should decide if the city is in breach of contract. If the City is in breach, then damages should be compared to the higher revenue resulting from a tender.

    John Richardson – Independent Candidate – Toronto Ward 29

  3. Pingback: Sweetheart deal on the beach | Vote John Richardson – Independent Judgment For Toronto Danforth – Ward 29!

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