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2nd developer goes to court to avoid questions from Ontario auditor general in Greenbelt probe

A second prominent Toronto-area developer who owns land that was removed from southern Ontario’s protected Greenbelt last year is going to court to avoid answering questions from the province’s auditor general.

Michael Rice, CEO of Rice Group, filed a notice of application with the Ontario Superior Court of Justice on July 5 seeking to block or delay a summons from Auditor General Bonnie Lysyk that he be interviewed and provide records related to land he owns in the area that is now cleared for development.

Lysyk has been looking at the provincial government’s removal of environmental protections from more than 2,995 hectares of land — while adding other land elsewhere — so that 50,000 homes can be built. 

The Greenbelt was created in 2005 to permanently protect agricultural and environmentally sensitive lands from development and covers some 810,000 hectares area of farmland, forest and wetland from Niagara Falls to Peterborough. 

In the court filing that was first reported by The Toronto Star, Rice argues the summons oversteps the auditor general’s authority to scrutinize provincial government finances.

“The auditor general’s role is not to investigate, audit, and/or examine private citizens under oath, or go on fishing expeditions with respect to their private corporate affairs,” the filing says.

Rice’s filing came just a week after another developer who benefited from the Greenbelt decision — Silvio De Gasperis — made a similar application. De Gasperis is president of the Vaughan, Ont.-based Tacc Group of companies.

WATCH | What Ontario’s premier has said about the Greenbelt:

2nd developer goes to court to avoid questions from ontario auditor general in greenbelt probe

Here’s what Doug Ford has said over the years about developing Ontario’s Greenbelt

8 months ago

Duration 0:40

From pledging to never build on it in 2018 to saying it’s part of the solution to Ontario’s housing crisis in 2022, here’s how the premier’s position on the controversial issue has changed.

Bought property in September

Lysyk’s office agreed in January to conduct “certain audit work” related to the so-called Greenbelt land swap in response to a joint call from all three opposition parties.

Opposition politicians and other critics have raised concerns about what developers might have known in advance of the government announcing the policy. Ontario Premier Doug Ford and Housing Minister Steve Clark have denied tipping off developers.

As CBC Toronto first reported, property ownership and corporate records showed several developers bought land in recent years that was either wholly or partly in the Greenbelt — meaning they were fully or partially off limits to development at the time of purchase.

An aerial view of farmland showing fields, some houses and other buildings.
A company controlled by Rice paid $80 million for five parcels of land in King Township, north of Toronto, in September — less than two months before the Ontario government said sections of that land would be opened for development. (Yan Theoret/CBC)

A company controlled by Rice paid $80 million for five parcels of land in the Township of King, located about 50 kilometres north of Toronto, on Sept. 15 last year — less than two months before the Ford government announced sections of that land, which were protected, would be opened for housing and other development. 

At the time, the local council said Rice was willing to provide some of the land for an expansion of a nearby hospital at a “nominal fee.”

Request ‘overbroad,’ developer says

The auditor general’s office requested an interview with Rice in April. Possible topics of discussion, according to the filing, included:

  • The overall experience working with the government to amend the Greenbelt boundary.
  • The Ontario government’s expectations for the development of land removed from the Greenbelt.
  • Industry challenges with Ontario’s land-use planning system.
  • Possible servicing challenges related to developing land removed from the Greenbelt.

Lawyers for Rice responded in May, saying he would not be able to provide any meaningful information. But the auditor general disagreed, stating Rice could provide “insight that is material to our audit,” according to the filing.

Lysyk followed up with a summons on June 27, demanding Rice submit to an examination under oath and provide “any and all relevant records, correspondence, notes and documents,” the filing says.

Rice’s application argues he shouldn’t be compelled to testify because the request for documents is “overbroad” and some are potentially commercially sensitive.

He is asking the court to quash the summons, suspend it, or prevent him from being compelled to produce records, particularly those he deems commercially sensitive.

CBC Toronto requested comment from Rice via his company and lawyers, but did not receive a response.

A spokesperson for the auditor general’s office said it’s unable to comment on an ongoing audit, but expects the Greenbelt report to be released in September. Lysyk’s second term ends on Sept. 3.

A spokesperson for the housing minister said Monday the government is co-operating with the auditor general.

Silvio De Gasperis and his brothers Carlo and Michael De Gasperis own land that was removed from the Greenbelt in three municipalities — Vaughan, Richmond Hill and Pickering — including at least 28 properties in the Duffins Rouge Agricultural Preserve, corporate and property records show. 

Silvio has donated to the Progressive Conservative Party of Ontario in the past.

A person with the name Michael Rice has donated more than $10,000 to the Progressive Conservative Party of Ontario since 2018, according to Elections Ontario data, including a $946 donation made in 2020 to Housing Minister Steve Clark’s riding association. It is not known if he is the same man who heads the Rice Group. 

The same person has also donated a smaller amount to the Ontario Liberal Party.

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