Mayor Rob Ford and Councillor Doug Ford repeatedly involved themselves in negotiations around a tax grant for a beauty products company that was erecting a new factory and preparing to move to the city, records released by the City of Toronto show. What no one in the civil service knew at the time was that the company, Apollo Health and Beauty Care, was a major client of the Ford family label business. The document trail starts in April 2011, about five months after the Ford brothers took office.
Read Greg McArthur and Elizabeth Church's investigation: Ford brothers helped business client lobby city for tax break
April 20, 2011 letter from Joe Pennachetti
The first document that points to the Fords’ role in the grant negotiations is a letter written by City Manager Joe Pennachetti, the city’s top bureaucrat. Mr. Pennachetti wrote to the owner of Apollo, Richard Wachsberg, to inform him that the city could not make an exception for his company and increase the size of his grant, and he CC’d Councillor Ford and the mayor’s then chief of staff. Under the policy, businesses that apply for the grant are entitled to 60 per cent of roughly 10 years’ worth of property tax assessments. Mr. Wachsberg, notes and interviews show, wanted his grant to cover 20 years and was looking for a “different percentage.” Mr. Pennachetti, who was asked to entertain Mr. Wachsberg proposal in a meeting set up by Councillor Ford, refused the request.
Download: Pennachetti to Wachsberg, precedent issues
The next day, Wachsberg replies to the Fords
Mr. Pennachetti’s refusal prompted Mr. Wachsberg to send an e-mail to the Fords expressing his disappointment. “This response is very unexpected given our conversations,” he wrote to the brothers. No one – not the Fords or Mr. Wachsberg – has explained what the Fords promised or said in those conversations, but clearly, there had been discussions between the Fords and Apollo about increasing the size of Apollo’s grant. In an e-mail to one of his aides, Councillor Ford said he needed to “talk to Joe about this,” but Mr. Pennachetti told The Globe he does not recall what, if anything, Councillor Ford ever said to him about his decision.
Download: Wachsberg's response to Rob and Doug Ford
Less than a month later, another Pennachetti meeting
This e-mail shows that several weeks later, Apollo was again given an audience with Toronto’s top bureaucrat to discuss its property tax grant. This time, the discussion took place between Mr. Pennachetti and a tax consultant hired by Apollo, Bob Langlois. (Mr. Langlois summarized the meeting in this e-mail written the next day.) One of Mr. Langlois’s primary concerns, the e-mail shows, was how Apollo’s land was classified in the draft grant agreement. Apollo, which is a tenant of the property, wanted the city to recognize a decision by the Municipal Property Assessment Corporation that deemed the pre-developed land as “farmland” for tax purposes – which would significantly increase the size of Apollo’s grant.
Download: Bob Langlois e-mail
Six days later, Pennachetti meets again with the Fords, Wachsberg and Langlois
On May 24, Mr. Wachsberg and the Fords were back in front of Mr. Pennachetti to discuss the tax grant and other issues. This e-mail, which was written by an economic development officer, Rebecca Condon, who was supposed to be the point person on Apollo’s grant application, shows that, in addition to the grant, Apollo also wanted to discuss “traffic issues” with the city’s top bureaucrat.
Download: Meeting follow up
Mr. Pennachetti’s final letter
After three months of discussions, Mr. Pennachetti penned this final letter to Mr. Wachsberg. The letter confirms that, in keeping with MPAC’s decision to recognize the pre-developed land as farmland for tax purposes, the city would use that same classification when calculating the size of Apollo’s grant. That move significantly increased the size of the rebate, and Mr. Pennachetti estimated that it would amount to about $2.5 million. In addition to the grant, Mr. Pennachetti – an executive in charge of tens of thousands of city workers – assured Mr. Wachsberg that he had personally looked into his request for an all-way stop sign at the factory and that field studies were underway.
Download: Pennachetti to Wachsberg