Mammoliti, Shiner get rent deals from Toronto developers

TwoTorontocouncillorshave been paying well below the market rate to rent apartments from developers that havemillions of dollars in contracts with the city, a CBC News investigation has found.

David Shiner and Giorgio Mammoliti each leases a two-bedroom suite at 88 Erskine Ave., near Yonge Street and Eglinton Avenue, an apartment building run by Greenwin Property Management and owned by its sister company, Verdiroc Holdings.

The Greenwin-Verdiroc group does significant business with the City of Toronto, including managing a number of buildings for Toronto Community Housing, and developing new social housing. Mammolitiused to sit on the Toronto Community Housingboard.

The high-rise at 88 Erskine is considered one of the companies' prime non-subsidized rental properties. Its website says two-bedroom units start at $1,650 a month, and current tenants canvassed by CBC News said they paid around that, ranging up to $1,800.

Both Shiner and Mammoliti have been paying less for years, according to information obtained by CBC News.

Shiner moved into an 11th-floor, two-bedroom unit in the building in 2004, leasing it in the name of a numbered company he controls, and started off paying $600 a month a price that includes a pair of parking spots, which normally costbetween $75 and $125 a month each. His rent increased slightly in 2011 and 2012. As of last June, he was paying just under $630.

Mammoliti began leasing an apartment for $1,000 in February 2011 and the rent rose to slightly above $1,050. The same suite cost the previous tenant more than $1,600.

The Ward 7 councillor told CBC News last month that he doesn't currently live in the apartment. Sworn financial statements he submitted last October as part of a court proceeding said he stopped paying the $1,000 rent and moved back in with his parents. Even if he doesn't live in the building,CBC News has learned Mammoliti's leaseon the apartment was renewed less than four months later and now runs until the end of next January.

'You don't have the correct information'

Mammoliti would not address further questions about his status at 88 Erskine. "I'm not going into that," he said, later adding, "I'm not answering any more questions, OK?"

Shiner did not return emails and calls over the past two weeks. In an interview earlier this summer, he disputed that his rent was about $630, telling a CBC reporter, "You don't have the correct information."

He said he didn't know exactly how much he paid because the amount is a "direct withdrawal" from "a business account that I look at once a year." When several figures were suggested to him, he estimated his rent was probably "something like" $1,300, and in a second phone call said, "I don't know what the exact was, $1,500-and-some-odd, that's what the rent should be at, something like that."

Shiner said he rented the apartment through his numbered company in 2004 because he had some small business ventures on the go "and I was using it at the time for partial office space. It made sense to simply deal with it that way." He also stated that he did not get any special treatment, but simply drove a good bargain.

The market was substantially different. I moved into the building, I rented a space and I'm there, and that was what they were prepared to offer me at the time, he said.

CBC News has found more than a dozen longtime tenants who moved into two-bedroom suites in the high-rise before Shiner and had been paying more than double his rent. There is also a handful of other tenants with discounted or free rent, but all of them are acquaintances or family of the owners, or current or former Greenwin staff.

Neither city councillor represents the ward in which the building is located. Shiner is the councillor for Ward 24, in North York's Willowdale area, while Mammoliti's Ward 7 is in the northwest part of the city.

Staff at 88 Erskine would not comment and referred calls to corporate headquarters.

Kevin Green, CEO of Verdiroc Development and president of Greenwin, and his brother Cary Green, vice-president of Verdiroc and chairman of Greenwin, did not respond to phone or email messages.

A CBC reporter first called the companies in late June. Days after those calls, Shiner's rent was increased from under $630 to a bit more than $1,300 a month, CBC's investigation has discovered.

City dealings

The real-estate companies behind 88 Erskine have had significant dealings with the city.

Greenwin managed more than 20 Toronto Community Housing Corp. buildings, including four in Mammolitis ward, until last year, and still runs several. Mammoliti sat on the Toronto Community Housing board from 2001 until 2010, though CBC News has found no evidence he voted on any Greenwin contracts.

Verdiroc Development was the developer behind a pair of recent affordable housing projects along Queen Street West that received a combined $20.4 million in city support.

Both Shiner and Mammoliti cast votes to fund those projects (see details below). The votes were all in 2009, two years before Mammoliti started leasing an apartment again at 88 Erskine, and all aligned with city staff's recommendations.

The councillors have crossed paths with the companies elsewhere, as well.

CBC News previously reported that at least one senior Greenwin executive was at a $5,000-a-table gala fundraiser for Mammoliti held in May in Woodbridge, just north of Toronto. CBC News has not confirmed, however, whether the executive paid for the ticket or received it free as some guests did.

Shiner was in the headlines in late 2005 when he tried to have the members of a city tribunal dismissed after they delayed a Verdiroc condo development.

'You should be squeaky clean'

Asked whether he could be in a conflict of interest by voting on his landlord's business at city council, Shiner said: "I could live in any building and most buildings are managed by people that come to the city for development proposals. If there was ever a concern, I would get legal advice to be sure that I'm never in a matter of conflict of interest."

Mammoliti said in a statement that he would not respond to the story.

"I feel it necessary to state once again that the CBC has reported with inaccurate information and is continuing to construct negative stories which are unrelated to my job," he said. "I will not address any stories involving personal matters."

City records since 2007 show neither councillor declared any conflicts on any Greenwin-Verdiroc votes, though municipal affairs experts consulted by CBC News said it's quite likely they wouldn't need to. Ontario's conflict of interest law states that a councillor has to have a direct or indirect "pecuniary interest" in a matter to be required to recuse himself or herself.

Speaking generally and not about the facts of this particular case, lawyer George Rust-D'Eye, the former chief solicitor for Metro Toronto, said that means a mere financial relationship with a company isn't enough to disqualify a politician from voting on its business.

"You have to look at the actual facts: Was there an interest? Was there a connection? Was there some quid pro quo or direct or indirect benefit involved?"

But Rust-D'Eye, who has also served as integrity commissioner to several Ontario municipalities, said that to be on the safe side of the conflict of interest law, he would advise a member of a city council to avoid voting on a landlord's business dealings.

"I would say, 'Well, you should be squeaky clean.' Any matter involving your landlord, if I were advising you, I'd probably say just stay out of it, don't participate."

In addition to the provincial conflict of interest law, Toronto has a code of conduct for councillors that prohibits accepting a "fee, advance, gift or personal benefit that is connected directly or indirectly with the performance of his or her duties of office."

David Siegel, a political science professor at Brock University in St. Catharines, Ont., who specializes in local government, said getting rent at below-market rates "clearly" counts as a personal benefit, but the issue is whether it's tied to the councillor's duties.

"When the benefit becomes quite significant, that's one thing that might raise questions around the code of conduct. A savvy constituent would be asking these people to explain what their relationship was with this company," he said.

"Was there some extenuating circumstances that we haven't heard about that caused them to receive this apparently lower than market rent? What other relationships might they have with the company?"

Voting records

Councillors David Shiner and Giorgio Mammoliti have voted multiple times each over the years on matters involving the Greenwin/Verdiroc group of companies, from which they both currently lease apartments at below-market rates, according to information obtained by CBC News. Legal experts cautioned that, generally speaking, that kind of relationship doesn't in itself put a politician in a conflict of interest. Here are many of those votes:

In 2005, a year after Shiner became Verdiroc's tenant, the company sought approval from a city tribunal to nearly double the number of units in a condo it was planning at Sheppard and Bayview avenues. The panel eventually deferred the request in a move marked by procedural irregularities.

Shiner, who supported Verdiroc's application, then brought a motion to have all five members kicked off the panel. The motion was ultimately ruled out of order, but not before landing Shiner and a fellow councillor in the headlines for months. He also cast four votes, over two ensuing council meetings, that helped block city lawyers from trying to fight Verdiroc's proposal at the Ontario Municipal Board.

In 2007, he voted on how to disburse $1 million in city subsidies for low-income renters. City staff had recommended allocating the money to an entire neighbourhood, instead of solely to tenants of a Verdiroc-owned building. Councillors voted 7-1 in favour of the staff plan, with Shiner as the lone dissenter.

Mammoliti, who was chair of the Toronto's affordable housing committee from 2005 to 2010, introduced at least five motions at various city bodies in favour of funding for Verdiroc's Queen Street West developments. All of them passed, resulting in $20.4 million in backing for the two affordable-housing projects.

The votes were all in 2009, two years before he started leasing an apartment at Verdiroc's building at 88 Erskine. Shiner voted once in favour of one of the projects, as well. All those votes aligned with city staff's recommendations.

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