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Whig Standard -- July 10 2008

Conflict allegation to be heard by judge

Mayor could be removed if guilty in arena controversy


A Kingston realtor who was appointed by mayor Harvey Rosen to a task force that chose a location for a new civic arena once had a contract to sell the land, court records show.

The revelation comes amid a court battle in which a citizen, failed mayoral candidate Rick Downes, alleges that Rosen violated municipal conflict of interest law as the city debated and approved a plan to build what became a $46.5-million arena and entertainment centre.

Downes's allegations have not been tested in court. Rosen has denied the allegations.

Downes has asked a judge to declare that Rosen broke the conflict law. Downes and Rosen will appear before a judge in open court today for the first time.

If Rosen is found guilty, he could be removed from office. A Kingston businessman figures prominently in the case.

Downes contends that the mayor's business relations with John P. Wright, the president of K-Rock radio, are a key issue.

A family business of which Rosen is president, Rosen Corp., rents space to K-Rock in a building on Princess Street.

The radio station bought the right to put its name on the new arena, which opened in February this year. K-Rock provides the city with $3.3 million worth of cash and services over 10 years.

When the naming rights deal was approved at city council in February 2008, Rosen did not vote, declaring a "possible pecuniary interest" because of Rosen Corp.'s business relations with K-Rock.

Rosen Corp.'s lease with K-Rock was signed in February 2001 and runs for 10 years, the mayor has revealed. Wright also is listed in government records as the president of a numbered Ontario company that owns the Kingston Marina.

A Rosen-appointed task force concluded in 2004 that land on Wellington Street that included the Kingston Marina was the best location for a new arena. The city would have had to buy the Kingston Marina property to build there.

In June 2004, city councillors endorsed the task force plan. The arena was not built there, largely because of public outcry.

Rosen voted in favour of the site.

Because he did not declare a conflict, he violated the Municipal Conflict of Interest Act, Downes claims.

As part of the legal process in the conflict case, Downes and Rosen questioned each other on May 27 in closed-door cross-examinations.

In advance of the hearing today, Downes filed a 155-page application record that includes a transcript of the cross-examinations.

It also includes copies of two memos that Downes claims he acquired from unknown sources.

One is dated Nov. 15, 1990, and is addressed to four businesses that rented space at the Wellington Street property first picked as the arena location.

The 1990 memo, from John P. Wright, informs the four businesses that a listing agreement has been signed with realtor Martin Skolnick to sell or lease the property.

"The listing agreement is to sell or lease the remaining space inside that building that you are all in," the memo states.

It explains that if the property is sold, the sale will include the area from the dry dock to the OHIP building parking lot. A sale would not affect the leases the tenants had, they were told.

The arena task force, which included a hospital CEO, a Queen's business professor, a professional hockey agent, one city councillor and Skolnick, performed its work in secret and with no oversight by city politicians.

Skolnick said he was not acting for Wright at the time he served on the task force.

"[Wright] wasn't my client at the time and hadn't been for quite a few years," Skolnick said, in an interview with theWhig-Standardthis week.

He said he had no business relations with Wright in 2003 and he didn't feel he had any conflict in serving on the task force.

"We hadn't even discussed sites, so that site wasn't even [on] the radar when I was appointed to the task force," he said.

A second memo revealed in the closed-door examinations is dated Oct. 19, 1995, and is addressed from Skolnick to six people associated with the Wellington Street site.

"As you are all aware, John Wright has retained me as the Property Manager for the Kingston Marina complex," the memo begins.

It explains that a property cleanup will be conducted.

"I recall that there was some environmental cleanup and I was acting for John at that time, but I haven't acted for John on that property since probably that period of time," Skolnick told the Whig.

He said he has not acted for him with respect to any other properties in the area.

"John doesn't, to my knowledge, own any other properties in Kingston, other than his home," Skolnick said.

He said he doesn't believe he'd necessarily have a conflict, even if he had acted for Wright at the time he served on the task force.

"I wasn't obviously getting paid any sort of commission for my volunteer role as a member of the task force, first of all, and, second of all, in my day-to-day life as a real estate broker, there's very few properties in Kingston that I don't have some sort of involvement in from some point in time, since I've been doing this for 24 years in Kingston," he said.

Wright could not be reached for comment. During the cross examination, Downes asked

Rosen several questions about the two memos. Rosen's lawyer, Wilfrid Menninga, who was present, interjected that Rosen would not answer, according to the transcript.

Downes also asked if Rosen Corp. ever had a business relationship with Skolnick and whether Skolnick served on Rosen's election campaign in 2003.

Rosen did not answer.

Menninga said the questions were "not relevant."

Rosen answered when asked to describe his relationship with Wright.

"I know John to say hello," Rosen replied, according to the transcript. "That's about the extent of it. He is in our building. I see him from time to time to say hello.

"That's about the extent of my relationship with him personally."

Rosen refused to produce a copy of the lease with K-Rock, although he acknowledged that it was executed by John Wright.

Rosen said he executed it on behalf of Rosen Corp.

Menninga asked Downes how he was certain that Wright owned K-Rock and the Kingston Marina.

Downes cited the two memos, a phone call to a tax clerk at City Hall and "common knowledge."

"It's sort of like Santa Claus is living on the North Pole?" Menninga inquired.

"Well, I don't think so, sir," Downes said. Downes conceded that he doesn't know the exact nature of Wright's business position with respect to K-Rock or the Kingston Marina.

Menninga asked if his claim is based on the lease between Rosen Corp. and K-Rock.

"The landlord/tenant relationship between Harvey Rosen, who is president of the Rosen Corporation, and Mr. John P. Wright, who is the owner of K-Rock radio station, establishes a pecuniary interest, that's correct," Downes said.

Court records indicate that Downes and Rosen are expected to make half-hour presentations to a judge.

The judge could rule today on the conflict allegation or order a full trial.