A pre-election Global Transportation Hub land sale agreement, much-touted by Premier Brad Wall as proof that "taxpayers are making money" at the GTH, is still in limbo eight months later.
On March 3, just days before the start of the provincial election campaign, the GTH — a government-owned inland port west of Regina — announced it had an agreement to sell 30 acres of land to Brightenview Development International Inc. for $7.6 million, or $256,000 an acre. Approving this deal was cabinet's last official act before dissolving the legislature and calling the election.
During the election campaign and to this day, Wall regularly references this agreement as proof that despite the ongoing GTH land deal controversy, the GTH is doing just fine.
The controversy swirls around the fact that in 2014, the GTH paid a Regina developer $103,000 an acre for 204 acres of land, which government appraisals said was worth half that amount at best.
"We readily admit that too much might have been paid, even at $103,000 an acre," Wall said in the Legislature. "But since then, land similar has been selling for $260,000 an acre. So, we have every expectation that the taxpayers will not lose money."
Wall has acknowledged the comparison of the two amounts is apples and oranges as the $103,000 an acre land is unserviced while the $256,000 an acre land is fully serviced.
Brightenview still doesn't own GTH land
Eight months after the announcement, Brightenview still hasn't taken title on the 30 acres.
The Premier's office said Brightenview has paid a non-refundable deposit of just over $500,000 on the land and is still working with the GTH on its development plans.
In an interview the day the project was announced, Nystrom (a former NDP MP) wouldn't specify when construction would start.
"These projects are things that you can't put a precise timeline on," said Nystrom. "And once we have something to announce, we will do that."
The day of the Brightenview announcement, GTH CEO Bryan Richards said he didn't have much information to share publicly about what Brightenview was planning to build. He described it as a "venture by Brightenview to develop what they would call a global trade centre. It's pretty preliminary in terms of their plans and development."
Richards said he would be working out the details with Brightenview in the coming weeks but "likely we won't have much more to say on this for, I would say, probably two to three months."
CBC asked Brightenview for an update and for weeks the company failed to acknowledge multiple emails and phone calls. Then, shortly before the story published company CEO Joe Zhou sent a brief email. He said the GTH is a "perfect fit for our business development vision," but he would have nothing more to say until the company's development plans are complete.
In an email, the GTH said it expects the land deal to close before the end of the fiscal year.
Remarkably timed deal
The land sale contract between Brightenview and the GTH was signed at an intriguing time.
A document obtained through access to information shows the contract was signed on Feb. 3 at 11:30 a.m. CST.
Coincidentally, at 5:30 a.m. that very morning, CBC's iTeam broke the GTH land deal story that has become the subject of such controversy.
When asked if there was any connection between the timing of this deal and CBC's story, Richards said "absolutely not."
That's not the only bit of curious timing.
On Dec. 16, 2015, CBC sat down for its first and only interview about the land deal with then-minister responsible for the GTH and chair of its board Bill Boyd. He had directed the GTH to buy the 204 acres for two to three times more than appraised value.
The next morning, there was a flurry of email among GTH staff and a board member. They were trying to nail down details for a Dec.18 meeting with representatives of Brightenview.
One email notes that Boyd had decided to attend the meeting, which was welcome news to Nystrom.
Since 2013, Brightenview and the GTH had on-and-off discussions about working together, but the internal emails seem to show the move toward an agreement intensified in mid-December.
When asked if the GTH began arranging the meeting after CBC's interview with Boyd, Kelly Brossart, a communications official with the GTH, said that Richards had been working on the meeting for some time. She said he was arranging the meeting by phone so there are no emails prior to Dec. 17.
GTH requires Brightenview to sign 'co-operation agreement'
On Feb. 3, Brightenview and the GTH signed two agreements: A land sale contract and a "co-operation agreement."
In a ruling, the Saskatchewan Information and Privacy Commissioner has recommended the GTH release those documents to CBC. The GTH has refused.
However, internal GTH emails shed some light on what the "co-operation agreement" is all about.
'As per co-operation agreement, the GTH will approve all communication that references the GTH.' - Rhonda Ekstrom, GTH vice-president of business development
The day after the agreement was signed, Rhonda Ekstrom, vice-president of business development for the GTH, wrote to Brightenview reminding the company that "as per co-operation agreement, the GTH will approve all communication that references the GTH."
And just days before the March 3 announcement of the deal, Brossart wrote: "I'm also going to work on some Q and A tomorrow so everyone is singing from the same song book." The GTH shared that document with Nystrom.
GTH officials were in regular contact with the premier's office, which was intimately involved in deciding the timing of the announcement.
Officials in the premier's office also proofread the Q-and-A document and edited the news release.
The GTH's first draft of the release didn't include the selling price of the land. According to an email from Brossart, the premier's and Boyd's offices insisted that number must be in the news release.
The day of the announcement, Brossart sent GTH staff the news release and a reminder: "We are all privileged to information beyond what this attachment says. A gentle reminder we should not disclose anything publicly beyond what we say in the attached."
Other Brightenview projects delayed
On its website, Brightenview describes itself as "one of the fastest growing companies in Canada."
But the company only has one project listed on its website and that project has been stalled for years.
Back in 2012, the company proposed building a megamall in the small town of Dundurn, Sask., just outside of Saskatoon. The Dundurn International Exhibition Centre was proposed to be hundreds of thousands of square feet of space in which 350 Chinese businesses could show off their wares to North American retailers. In addition, regular shoppers would be able to buy factory-direct.
Four years later, the land still sits barren, though Nystrom points out Brightenview did do some brush clearing a few years back.
Nystrom says the Dundurn project is still on track.
It's not the only Brightenview project that's suffered delays.
Near the end of September 2014 Brightenview announced a project in Ontario. At a sod turning ceremony, Zhou announced Brightenview was going to build a multimillion-dollar global development centre in the Chatham-Kent, Ont., area.
Like the GTH-based venture, this project was announced on the eve of an election.
Construction was set to begin in spring 2016, but the project was put on hold because of some problems with Ontario's immigration program which may have made it difficult for Chinese business people to relocate to Canada.
The land has been turned back to the municipality and Brightenview has forfeited its $40,000 deposit.
But in an interview after Brightenview's GTH project was announced, Nystrom was confident in the future of the GTH deal.
"We wouldn't be buying land if we didn't think the project would go ahead," said Nystrom. He pointed out that the company had paid a large deposit and "you don't just do that on spec."
This story previously stated that the day of the Brightenview announcement, GTH CEO Bryan Richards said he didn't know much about what Brightenview was planning to build. It has been changed to clarify that he didn’t have much information to share publicly about what Brightenview was planning to build.Nov 21, 2016 11:58 AM CT