Nanaimo council was scolded in a strongly worded letter sent in early March over its decision to pursue potential funding mechanisms to acquire privately held property in Linley Valley West.
The Nanaimo Economic Development Corporation also blasted council for discussing, in public, the idea of forced down-zoning to reduce property value so the city could purchase it for its own benefit.
On behalf of the the corporation's then-interim board of directors, Susan Cudahy, former NEDC executive director, wrote that council's "process can be viewed as equivalent to insider training under the Canadian Securities Act. The process of intentionally de-valuing an asset for personal gain is generally considered unethical and often immoral."
On Feb. 27, council approved a motion by Coun. Bill Bestwick to pursue funding mechanisms to potentially purchase part of Linley Valley West after a residents' organization made a plea to council to protect it from development.
Two weeks later, after receiving the letter dated March 2, council reversed its decision.
At the time, Coun. Diana Johnstone, who is also the chairwoman of the Parks, Recreation and Culture Commission, noted that Linley Valley was not on the city's priority list to protect as a park. She also said council might have acted too hastily in its eagerness to protect the land.
Mayor John Ruttan said council was not impressed by the letter, which the News Bulletin acquired through a Freedom of Information request.
"It's fair to say the letter wasn't all that well-received," said Ruttan. "It's my view they were a little aggressive in their position that the city should not proceed with it. We had some discussions about it and I think, at the time, Susan may have been aware that it was a little more assertive than they would have liked."
Shortly after, Cudahy was being harshly criticized by council and the public for paying a Toronto firm $8,800 to develop the NEDC's new website, even though a local company had also been engaged to do some work on the project.
On one occasion, Cudahy was allegedly accosted in a Nanaimo grocery store by a resident and spat on in front of her daughter. She then took personal time and returned to her home in Ontario. On April 13, an NEDC board member and a city official interrupted a meeting between Cudahy and a photographer to take her office keys and escort her from NEDC property.
She never returned to work and in late May, Cudahy was given a $75,000 severance package on top of the roughly $70,000 she had earned in her six months on the job.
A.J. Hustins, chairman of NEDC, said he doesn't think the letter had any bearing on Cudahy's departure.
"I don't think they're related at all," he said.
Hustins added that in his view, council had no problem with the letter.
"I think council took that letter really well," he said. "I ended up meeting with most of [council] afterwards ... and it went as well as it possibly could have."
Ruttan said at least one councillor was concerned about the letter and found it overly aggressive.
"That councillor did have a meeting with [Cudahy] and my understanding is that the meeting was satisfactory," said Ruttan.
Along with criticizing council's open discussion on down-zoning land, the letter also said council's actions would send the wrong message to investors looking to do business in Nanaimo.
"The highly serious aspect of these discussions is the indication to developers and investors in Nanaimo that the [Official Community Plan] is not a committed document and can be waived and redirected at the whim of special interest groups," Cudahy wrote. "And that council will actively partake in researching opportunities to reduce developers' opportunities to see an investment through to full value."
reporter2@nanaimobulletin.com