The South Interior Recreational Equine Centre’s announcement on June 14 that it will walk away from Desert Park has provoked allegations from the Town of Osoyoos and SIREC about who was at fault in a failure to develop a long-term agreement for use of the park. Photo by Paul Everest - Click on picture for larger image

OSOYOOS TIMES-June 29, 2011

By Paul Everest - Osoyoos Times

In the wake of the South Interior Recreational Equine Centre’s (SIREC) announcement last week that it plans to walk away from a short-term lease with the Town of Osoyoos for Desert Park, more details have emerged to show that the organization and the Town have had a dysfunctional relationship for roughly a year.
On June 14, SIREC president Allan Carswell sent a letter to Barry Romanko, the Town’s chief administrative officer, advising him that the organization would be terminating its month-by-month lease for the park as of Aug. 31.
The reason SIREC is walking away, Carswell said in the letter, is because the organization has been “unable to attract major events during that time due to the uncertainty caused by such a short-(term)-lease arrangement.”
He added that because SIREC and the Town have not been able to finalize a more permanent arrangement for the stewardship of the equestrian component of the park, mainly since the Town received a legal opinion that a long-term lease with SIREC would not be in its best interest, SIREC has been unable to host any major revenue-generating events such as car shows  or equestrian competitions.
Carswell also said in the letter that it is unfair that the Town has followed legal advice not to sign a long-term lease with SIREC since it is a for-profit organization.
SIREC has also publicly complained that it has had to wait more than a year-and-a-half for the Town to work out some kind of long-term arrangement for stewardship of the park since council agreed in December, 2009, to work towards such an arrangement with SIREC.
In a “community update” on Desert Park negotiations released this week, however, the Town and Osoyoos council have challenged some of the allegations made by SIREC.
Despite a claim by Carswell that SIREC was obligated to become a for-profit organization to meet the requirements of an expressions of interest (EOI) process for the park issued by the Town in November, 2009, the Town states that such a requirement was not dictated in the expressions of interest documents.
The Town points out that the EOI invited “established businesses or a recognized legal entity” to respond.
“This legal entity could have been a not-for-profit corporation (similar to the golf club), but SIREC chose their current model based on their own needs.”
The Town also states that SIREC was incorporated in March, 2009, prior to the advertisement of the EOI.
The blame for delays in negotiating a long-term agreement for the park is shared by the Town and SIREC, the Town states in the update.
Town staff had to wait for direction from council on certain issues and SIREC negotiators had to wait for direction from the organization’s board of directors.
But the Town states that a “lack of availability of SIREC negotiators contributed significantly to extended delay periods.”
“The Town has not been able to schedule a meeting with SIREC since we provided them the legal opinion in December (2010),” the update states.
That legal opinion suggested that a lease might not be the best option for the park because the Town will need access to certain areas such as the baseball diamonds for a number of activities and the Portuguese Canadian Cultural Society needs access to its clubhouse.
The Town’s lawyers advised that if a lease were in place, the Town would have had to sublease those parts of the facility from SIREC.
As for an allegation made in an editorial in the Osoyoos Times last week that the Town should have set out a legal framework for any agreement with SIREC prior to council’s agreement in December, 2009, to work with the organization, the Town responded that it and SIREC both had a “responsibility to know the legal framework that they are operating within.”
“The Town sought legal direction when they thought appropriate, within the context of the negotiations,” the update states. “A disposition of land tool was sought after negotiation on key operating principles.
“At no time in the negotiation was this agreement development strategy disputed by SIREC.”
One of the more surprising pieces of information contained in the update is that SIREC has not paid the Town any lease monies or other fees since July of 2010 and the organization now owes the Town $12,000.
Council has now asked SIREC to vacate Desert Park as of July 31 and has requested a meeting to “clarify SIREC meeting its obligations on closure of the current agreement.”
In an email sent to the Times on June 25, Carswell confirmed that SIREC paid its last lease payment, including five-per-cent of any revenues it makes off the park, owed to the Town last July.
He said, however, that since council resolved in January, 2010, that SIREC’s month-to-month lease of the park would last “until an operator is in place at Desert Park or until July 1, 2010,” SIREC did not have a “formal lease” with the Town after that point in time.
“The long-term lease that we had worked out with the Town was a net-profit lease, i.e. the Town would receive 30 per cent of any profits made at Desert Park,” Carswell said. “That agreement was dated July 1, 2010, when it was completed and sent for a legal opinion. The thought being that the long-term lease would start from that time. Until that point we received monthly invoices from the Town. Since July 1, 2010, we have not received an invoice, showing that the Town also agreed with this view.”
As for the Town’s statement that it has not been able to meet with SIREC since December, Carswell said the “last unofficial words” from Romanko came in October informing SIREC that there were legal issues surrounding negotiations.
“At that time they were to seek council input on the way forward,” Carswell said. “We never received a request to meet with council or staff.”
Finally, when asked about the issue of being a for-profit organization, Carswell said SIREC’s motives were based on an interpretation of the Town’s EOI documents.
“In the RFP it states in several places ‘company.’ I know of no such thing as a non-profit company; they are called societies.”
He added that SIREC’s for-profit status only became an issue for the Town “at the legal opinion stage.”
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