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CFO forced out after warning city about Olympic Village cost: Mason

Vancouver's top financial manager resigned two weeks ago, according to a column by Gary Mason in today's The Globe and Mail, after more than a year of expressing her concerns about the city's deepening financial investment in the Olympic Village at Southeast False Creek.

Mason's report contradict finance committee chair and NPA mayoral candidate Peter Ladner's daily assertions that CFO Estelle Lo is still on the payroll and that "she has never spoken to anybody I know about this project or any concerns she has about this project."

Columnist Mason, who broke news of the Olympic Village scandal last week, updates the story today with new (but still unattributed) claims:

Estelle Lo's concerns about the city's involvement in the Olympic athletes' village were well known and dated back more than a year.

It was then that the director of finance for the City of Vancouver first expressed to staff the worries she had about the financing arrangements with the project's developer, Millennium Development, according to sources.

Paramount among those concerns was the potential risk and liability the city was assuming in the project. Did the city have access to Millennium's corporate assets if it needed to recoup monies owed in the event the developer failed to complete the project, she wondered.

Mason directly refutes Ladner's carefully worded suggestion that Lo has not resigned:

There seems little question now that her concerns led to her resignation, which was accepted by the city Oct. 29. Personally, I think she was given little choice: either you resign or we'll fire you. And while Mayor Sam Sullivan said last week he hadn't heard anything about her departure and that, as far as he knew, she was still on the payroll, that seems impossible to believe.

I was told yesterday her office has been padlocked.

And Mason concludes today's column with some real-estate math:

If the loan from Fortress is $750-million and you add, potentially, $100-million to cover cost overruns, and then another $193-million for the cost of the land, then you're looking at total costs of more than $1-billion. That means the 1,100 units in the residential complex that was once the athletes' village would have to average $1-million each.

In this market, it's not going to happen.

Today's Globe also includes a Frances Bula article, which reports that the cash portion of the city's property endowment fund is tapped out:

Vancouver didn't raid the city's much-valued Property Endowment Fund as a source for a potential $100-million loan to the builder of the city's Olympic athletes village.

That's because the fund's almost $200-million in cash reserves have already been depleted to pay for what the city has to build on the site.

And completing the trifecta, today's Globe also includes an article expanding on on the political fallout from Millennium Development's stalled hotel project in Nanaimo, which was reported on The Hook last week.

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