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SOMBA K'E/YELLOWKNIFE
Habitat for Humanity’s request for council to forgive $120,000 for the cost of two lots purchased from the city of Yellowknife last spring was rejected during a committee meeting on Monday afternoon.

Robert Charpentier, treasurer for Habitat for Humanity Yellowknife, stands in front of one of the lots purchased from the city. Charpentier was disappointed but relieved that council voted in favour of having administration review a motion to grant a $34,000 rebate to the organization, after Habitat claimed the city had pressured them into buying land that was unsuitable to build on. - Cody Punter/NNSL photo

Habitat requested council forgive a portion of the cost of two lots which it agreed to purchase for $116,000 and $118,000, on the basis that the city had pressured it into buying them, knowing that the properties would require a significant amount of work.

Habitat officials said former SAO Bob Long dissuaded members of the organization’s board from approaching council about the possibility of looking at other lots available for purchase.

As a result, Habitat asked council to waive the cost of the two plots, while the organization offered to pay the land improvement tax for each property -- $57,000 on each lot.

Councillor Cory Vanthuyne was not willing to support the request and argued the circumstances under which the lots were purchased should have raised red flags for Habitat for Humanity.

“I see this as a business deal gone bad,” said Vanthuyne. “Unfortunately, I also see this as a case of some poor judgment, and bad advice by those who were quite frankly in positions to recognize these red flags.”

Vanthuyne was sympathetic to Habitat’s request, saying that it was an issue that “pulled on everyone’s heartstrings.” However, he said that offering to waive all fees for purchasing the lots, except for the $57,000 value associated with the land improvement tax, would go against previous precedents, while setting dangerous new ones.

“There would be considerable effects for future NGOs and non-profits who came forward to council,” said Vanthuyne.

Councillor Phil Moon Son echoed Vanthuyne’s concerns. Moon Son said many of his constituents said giving a break to Habitat would have wider implications.

“They feel that if assistance is given, it should be offered to all non-profit organizations,” said Moon Son.“We just don’t have the capacity to do that.”

After Councillor Bell recommended the two lots be considered separately, Vanthuyne suggested Habitat return the second lot to the city.

However, rather than defaulting on the investment entirely, Vanthuyne suggested that the $4,000 deposit, as well as an additional $30,000 in infrastructure spent on connecting sewer and water systems to the city’s supply, should be credited to Habitat and deducted from the cost of the first lot.

By saving Habitat $34,000 on the purchase of one of the lots, Vanthuyne argued that the organization would only need to raise another $30,000 to recover the cost of the land.

Although some councillors remained in favour of offering Habitat a land grant, council ended voted four to three in favour of Vanthuyne’s motion, which will now be reviewed by administration and voted on by council at a later date.

“We’re a little disappointed that they didn’t support our request. However, they met us half way, so we didn’t come away with nothing,” said Robert Charpentier, treasurer for Habitat for Humanity Yellowknife.

Charpentier said the organization was already considering giving back the second lot, after the cost of putting in the foundation at the first lot went nearly $75,000 over budget due to steep gradients and “rotten rock.”

“That might have happened without the financial incentive, but certainly with the financial incentive,” he said. “I think as a board, in all likelihood, we will decide to turn it back to the city.”

Charpentier said although it was an unfortunate learning curve, he was looking forward to partnering with the city in the future.

"We're brand new at this and certainly we've learned something about developing land in Yellowknife," he said.

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