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We’ll sue, Molinaro letter says

The Town of Fort Erie will be required to sock away $1.2 million per year for three years to fund “contingent liabilities” if it seeks to tear up its agreement with the Molinaro Group.

Treasurer Helen Chamberlain submitted a report to council stating that the town will have to raise $3.5 million from the tax levy — 18 percent of yearly tax revenues — to fund the liability.

“Based on the correspondence from Molinaro received on Feb. 9, it is anticipated that Molinaro will sue for breach of contract and seek damages as a result of the Town deciding to rezone the property,” she wrote.

She estimates taxes will have to be raised 6.9 per cent in 2011 just to finance this liability, not including other expenditures that were estimated to require a 4.7 per cent increase already.

“While the outcome of any legal case is not easily determinable, it would appear . . . that damages would be sought for the costs incurred to date, lost profits and recovery of legal costs. It is Town staff’s obligation to disclose this matter to the auditors.”

If the Town strips the money from reserves that are set aside for capital projects, they will be flagged as “high risk with the Province” and will endanger the Town’s ability to meet annual allocation requirements, Chamberlain wrote.

“A reactive approach to funding the financial risk associated with the decision to repeal bylaw 26-10 will put delivery of other municipal services and priorities in jeopardy.”

She also points out that the $20,000 set aside to hire an outside lawyer will cost the taxpayers $3,000 per year in additional debt charges to pay for construction of a new fire hall. The money was taken from the reserve that is funded by slots revenue.

In her report, she points out that the contingent liability does not include the costs to defend another Ontario Municipal Board appeal which will likely occur if the Town rezones the land again.

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RSS Feed for This Post11 Comment(s)

  1. Chris | Feb 22, 2011 | Reply

    O God of earth and altar,

    Bow down and hear our cry,
    Our earthly rulers falter,

    Our people drift and die;
    The walls of gold entomb us,

    The swords of scorn divide,
    Take not thy thunder from us,

    But take away our pride.

  2. Lori Dawn Antaya | Feb 22, 2011 | Reply

    Fabulous, I never even thought of any tax hike that they were going already give us…. Great, less food on the table. Sorry boys, Mommy and Daddy just can’t afford to feed you.

  3. Riko | Feb 22, 2011 | Reply

    If any Councillors vote in favor of turning down this project and we end up getting sued, they should step down from their position. Steckley better not vote in favor of turning this down seeing as he went on record stating that he would not vote for something that screws the taxpayers. When my taxes go up 7% to fund us getting sued at the decision of 4 Councillors, that is not transparent or responsible government. The people are telling you 4 Councillors, so you better listen: WE DO NOT WANT OUR TAXES GOING UP! SUCK IT UP AND ENJOY THE VIEW FROM THE 12th FLOOR!

  4. Steve | Feb 23, 2011 | Reply

    How could lubberts base his compaign on stopping this project, with no plan in place to cover the cost?

  5. Dave | Feb 23, 2011 | Reply

    Steve,
    Have you heard Lubberts speak? If so you would understand that he has no plan, never did. The only plan he has is what the other three are telling him to say. Almost sounds like a male version of NoYes.

  6. Ron Leggett | Feb 23, 2011 | Reply

    Mabee the Mayor should step down.He and his other 2 puppets got us into this mess in the first place.You should know what your getting into before you sign any contract. The people should have had a chance to VOTE on this project at the time of the town elections last fall.They just do things behind our backs.Wonder whos pocket is getting filled this time.

  7. Stan | Feb 23, 2011 | Reply

    Do you want to tell me Ron why it is that if something doesn’t go your way that you and the others (not all however) who hold your opinion about the Bay Beach project automatically default to some sort of corruption as being the cause?

  8. Steve | Feb 23, 2011 | Reply

    I wonder how many houses will be going up for sale when our taxes sky rocket. Fort Erie will be a ghost town when all is said and done.
    Don’t blame the Molinaro’s they were lead to believe that everything was going as planned our Town has a bad habit of doing that The Molinaro’s bought the old Erie Road Parking Lot with good intentions of fixing it up nice with pick nick tables added and landscaping it was to be kept as a overflow parking and pick nick area. We will be lucky if it even opens this year. What ever happened to the phrase build it and they will come!

  9. Ron Leggett | Feb 24, 2011 | Reply

    Stan,you talk about corruption look at last minicpal election.How come Martins ward reported in last. I wonder if it was fixed like other things around town hall are.

  10. Mike Cloutier | Feb 24, 2011 | Reply

    Doug Martin’s ward was not the last to report. The last ward to report was Ward 2. Martin lives in Ward 1. Martin has already said he would welcome a development like this in his neighbourhood. The way things are going with this council, it should be fixed.

    Ron, if you want to make intimations that people are corrupt, show us the corruption. Stan asked why people automatically think malfeasance is afoot when decisions are made that you don’t agree with.

  11. PGEO | Feb 24, 2011 | Reply

    The Fort Erie Post Quotes FEWPA lawyer John Keenan…”Keenan called Towwn Director Helen Chamberlian’s report a flawed document. The report was prepared by someone who does not possess evan a rudimentary knowledge of the law”
    Chamberlain’s report is just another example of Martin & Company’s Scare Tactics.
    I think Martin protests to much…
    PGEO

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