British Columbia’s auditor general found no evidence of bid-rigging in an audit of government asset sales, but Carol Bellringer says changes are needed after the province sold off prime land for millions under assessed value.
Bellringer’s report, released Tuesday, looks at 14 of the 101 sales, representing 75 per cent of the proceeds. It says with the exception of the Burke Mountain lands in Coquitlam, the government obtained 97 per cent of the appraised value.
The former Liberal government was heavily criticized in 2015 for selling off the valuable lands in Metro Vancouver to a party donor at a greatly reduced price. The then-Opposition NDP said the government had been “hosed” when it sold the land for $43-million less than the appraised price.
Bellringer said her office was aware of the controversy as it undertook the report.
“We did not find any evidence of bid rigging, collusion or bias during the audit. We did point out bias in relation to the some of the sales was perceived and it was raised in the legislature and reported in media.”
There were 21 parcels of land put up for sale involving about 240 hectares on Burke Mountain. The appraised value was almost $146 million.
Fourteen of the parcels were sold to Wesbild Holdings Ltd. for $85 million, 44 per cent below the appraised value. Four parcels were sold to the City of Coquitlam at 80 per cent of the appraised value and three weren’t sold.
Bellringer said the problem was the government took in bids both for individual parcels and as a package.
“They couldn’t compare one bid to the other,” she said in a conference call with reporters. “So you’re comparing apples and oranges. What we’re saying is it should have had the breakdown in the bidding received from those interested in purchasing the land.”
The former Liberal government launched the plan to sell off the assets in 2012, saying it would generate revenue, economic activity and cost savings.
However, Bellringer’s report says the Ministry of Citizens’ Service that was in charge of the sale only focused on the revenue target, with a goal of balancing its budgets from 2013 to 2015.
The asset sales surpassed the revenue target with a profit of $435 million, the report says.
Bellringer’s report makes seven recommendations, including that the government assess the costs and benefits of selling versus holding surplus assets and that it report to the public about how selling off an asset is in the best interest.
Citizens’ Services Minister Jinny Sims said in an interview that many of the report’s recommendations have already been implemented by the NDP government.
Sims said the government has ended the program and there are now systems in place to ensure taxpayers will get the best value for Crown properties.
“It is an abject failure of the minister of the day and the government of the day,” she said.
Sims said if she had a house on the market for $800,000 and someone offered her $600,000, she wouldn’t have accepted it.
“It seems to be those kinds of decision were made, because the focus was on collecting money.”
The government has built in a number of fail-safe methods to determine if the Crown property can be sold, including asking what the land could be used for in the future and analyzing if the cost of maintenance makes it prohibitive to continue to own, Sims said.
Opposition Liberal finance co-critic Tracy Redies said in a statement that ultimately, the market value for those properties is determined by what someone is willing to pay for them.
“Selling surplus real estate helps spur economic activity and create jobs for the province and its communities. The proceeds from those sales also helped to fund the important health and education services that British Columbians rely on,” she said.