Saturday, May 24, 2014
Sony Centre renovation balloons to $40M
Auditor General Jeff Griffiths found the cost of the ongoing theatre redevelopment will balloon from $28.5 million to likely more than $40 million by the time its done.
"This has quite clearly become a money pit," Councillor David Shiner told the Sony Centre board of directors on Friday as they met to discuss the report.
"It has cost the city way too much for the renovations ... It has gone off the rails tremendously."
Along with confirming that renovation costs have exceeded the estimates, Griffiths' report also details that the majority of contracts weren't awarded through an open tender, records for the construction project were incomplete, some financial transactions "have not been appropriately accounted for," and policies and procedures at the Sony Centre are "inadequate."
The actual cost of the renovation has already hit $38.5 million, with $4 million in work still to complete.
Part of the project has been funded with around $19 million from the sale of land and development density for the L-Tower behind the Sony Centre and $11 million came in negotiated payments from the developer.
Griffiths confirmed that after that cash is taken into account, taxpayers will be on the hook for around $10 million, including the $4 million to finish the redevelopment and a $6.6-million long-term interest-bearing loan from the city to fund the project.
Sony Centre CEO Dan Brambilla, who is slated to retire soon, refused to stop and answer reporters' questions when he left the meeting.
Given the issues raised in his report, Griffiths acknowledged Toronto residents should be upset.
"Yeah, I think they have every reason to be upset," he said.
Griffiths admitted he rolled his eyes "a little" when Brambilla told the board the redevelopment wouldn't cost taxpayers' a dime.
He said he was "astounded" at the response from Sony Centre staff that they didn't keep records because no one told them about the city's record-keeping procedures.
"That isn't a response. Everybody knows that you retain documentation," Griffiths said. "Quite frankly, a lot of (the paperwork) was missing."
Councillor Pam McConnell stressed to the board that the audit is a "very serious" matter.
"It is not a usual matter and it is going to the audit committee (next) Wednesday," McConnell said.
Please share this