Angry in the Great White North

The Royal Ontario Museum is undergoing a massive upgrade. The Renaissance ROM project will add 40,000 square feet of gallery space:

On February 26, 2002, the ROM announced the selection of Daniel Libeskind as the lead architect for Renaissance ROM, from a field of 50 international firms, with local partner Bregman + Hamann Architects. Libeskind's "Crystal" design provides practical and elegant solutions to many of the ROM's current challenges. The $200 million (CDN) project will be built in two phases, beginning May 2003, and will be completed in 2006, with Vanbots Construction Corporation providing Construction Management services.

Practical?

Yes, I know, it looks like the ROM is being consumed by a giant crystal blob. But you lack vision. A visionary would look past the fact that this thing looks like something that is one hailstorm away from disaster.

The museum-eating crystal blob has a name -- the Michael Lee-Chin Crystal. It is named after one of the major donors. The funding for Renaissance ROM is a story in of itself:

The overall project budget for Renaissance ROM is $270 million, comprising total construction costs of $240 million, plus approximately $30 million for the fit-out of the restaurant and retail facilities, financing charges and fundraising expenses.

On March 19, 2002, the Ontario Government, through the SuperBuild Sports, Culture and Tourism Partnerships initiative, announced funding of $30 million for Phase One of the project. On May 31, 2002, a matching $30 million commitment was made by the Government of Canada, through the Canada-Ontario Infrastructure Program.

On April 2, 2003, the ROM announced a lead gift of $30 million from Michael Lee-Chin, Chairman and CEO of AIC Limited; in recognition, the ROM named the new addition the Michael Lee-Chin Crystal.

The private sector Renaissance ROM Campaign, Canada's largest cultural fundraising campaign, was launched on May 28, 2003 on the occasion of the Groundbreaking. The Hon. Hilary M. Weston serves as Campaign Chair, with a broad-based 80-member Campaign Cabinet committed to the ROM's renewal.

On March 18, 2004, at the Museum's 90th birthday, the Renaissance ROM Campaign reached the $150 million mark with a $20 million gift from the Hon. Hilary M. and Galen Weston and the W. Garfield Weston Foundation, and eight other gifts. The ROM's 1933 heritage wing on Queen's Park will be named for Hilary and Galen Weston and the Weston family in perpetuity.

On March 23, 2006, the Government of Ontario announced further funding of $12 million for Phase Two of Renaissance ROM.

On November 7, 2006, the ROM announced a gift of $12 million from Robert Schad and Family.

On January 18, 2007, the ROM announced a gift of $10 million from Teck Cominco Limited. As of January 18, 2007, the Renaissance ROM Campaign has raised $218.3 million for capital costs, plus $31.3 million for related programs and endowment priorities, for a total of $249.6 million.

On April 26, 2007, the ROM announced CIBC as Inaugural Season Sponsor of the Michael Lee-Chin Crystal.

On May 30, 2007, the ROM announced $12 million in new major gifts to the Renaissance ROM Campaign, bringing the total amount raised at the time of the opening of the Michael Lee-Chin Crystal to $262 million. This includes $228 million raised for capital construction costs, plus $34 million for related priorities (such as endowed programs and curatorial positions).

When Mike Harris made $30 million available, it was under the condition that it was a one-time contribution, and that the ROM and the sponsors would cover the rest.

Now that funding information came from the Fact Sheet provided by the Royal Ontario Museum. Lots of gifts. Funny that the no mention is made of the help provided to the ROM by the Ontario Financing Authority in 2004. The OFA advises the Province of Ontario and Crown agencies (like the ROM) with borrowing:

The OFA assisted the Royal Ontario Museum (ROM) in acquiring up to $63.5 million in financing for the Renaissance ROM project by providing advice and assisting in negotiations with lenders. It is estimated that the joint efforts of the ROM and the OFA saved approximately $3.9 million in financing costs on a present-value basis.

Lenders? What lenders? There was no mention of lenders. Donors, not lenders.

In the 2005 audit, here is what is said of Renaissance ROM:

The Board of Trustees has approved phase I of a major redevelopment project for the Museum ["Renaissance ROM Project"]. The project will be completed in two phases with a total estimated cost of $200 million before financing and fundraising costs. Phase I, with a total cost of $150 million, is planned to be substantially completed in December 2005 or early 2006. Phase II will cost an additional $50 million and is scheduled to be completed one year later. The total project involves the construction and restoration of the original buildings as well as 40,000 square feet of new gallery spaces. Renaissance ROM will permanently alter the Museum's economic base, providing additional annual market income to sustain excellence across the board.

Funding for this project will come from the public and private sectors. To date the Museum has received commitments from the federal and provincial governments of $60 million. The balance will be funded through a fundraising campaign that is currently underway. As of June 30, 2004, the Museum has invested $85.5 million [2003 - $22.9 million] in the project which is recorded on the balance sheet as capital assets.

Now move forward two years, to the 2007 audit:

The Board of Trustees has approved Phase I of the Renaissance ROM Project. The project will be completed in two phases with a total estimated cost of $246,000,000 before financing and fundraising costs. Phase I, with a total cost of $224,800,000, is planned to be substantially completed in June 2007. Phase II will cost an additional $21,200,000 and is scheduled to be completed as additional funding becomes available. The total project involves the restoration of the original buildings as well as the construction of 40,000 square feet of new gallery spaces. The Renaissance ROM Project will permanently alter the Museum's economic base and is expected to provide additional annual market income to sustain excellence across the board.

Funding for this project is coming from the public and private sectors. As at March 31, 2007, the Museum has received commitments from the federal and provincial governments of $72,000,000 and from the private sector of $123,000,000. The balance is expected to be funded through additional government grants, the development of 90 Queen's Park and the ongoing fundraising campaign being carried out by The Royal Ontario Museum Foundation [the "Foundation"] [note 12]. As of March 31, 2007, the Museum has invested $213,708,000 [2006 - $164,241,000] in the project, which is included in capital assets on the balance sheet [note 4].

In fact, you can see a loan dramatically increase from 2005 through to 2007:

2005:

The Museum has a revolving reducing instalment term loan facility of $55,000,000 to assist with the financing of phase I of the Renaissance ROM Project...As of June 30, 2004, $13,278,000 was outstanding in connection with this credit facility.

2006:

The Museum has a revolving reducing instalment term loan facility [the "Loan"] of $55,000,000 to assist with the financing of phase I of the Renaissance ROM Project...As of June 30, 2004, $27,544,000 was outstanding in connection with this credit facility.

2007:

The Museum has a revolving reducing instalment term loan facility [the "Loan"] of $85,000,000 to assist with the financing of Phase I of the Renaissance ROM Project and $8,000,000 to assist with the financing of Phase II...As at March 31, 2007, $58,736,000 [2006 - $40,745,000] of bankers' acceptances were outstanding in connection with the Loan

So something happened that required the ROM to increase the line of credit associated with Phase I from $55,000,000 to $85,000,000. The overall cost of the project to build the museum-eating crystal blob as gone up from $200 million to $250 million, and is probably more now.

Remember that $63,000,000 mentioned by the OFA? I've been told that the CIBC is holding the mortgage, registered on title against the ROM and its collections.

But with all those well-heeled donors, something like this can be absorbed, right? But also remember that many of the museum's exhibits, now acting as collateral, were donated by these patrons:

Gifts to the Collection

As a registered charity, the Royal Ontario Museum can issue donation receipts for the fair market value of gifts in kind, such as artifacts or specimens. Additional tax benefits can be afforded to you if your gift is certified as being of cultural importance and national significance by the Canadian Cultural Property Export Review Board.

Please call the Office of the Governors at 416.586.8003.

It must be nice to have the trinkets on display in the crystal blob, with the words "A generous donated by Mr J Smith" on the display plaque. Why take the risk of it reading "Property of the CIBC" one day?

Still, it would be easier for the little people handle to problem? That way Ontario's elite won't have to worry about dealing with the bank. And anyway, Dalton McGuinty is always ready to lend a helping hand to Ontarians in need.

The fact is that as you are reading this, sources tell me that Dalton McGuinty's government is negotiating with the CIBC to take over the loan, putting you and me on the hook for $63,000,000 to pay for the crystal blob.

How generous of Dalton McGuinty to help out.

Now consider that Dalton McGuinty's government fought a court case in 2005 over funding for special education for autistic children:

A court ruling ordering the Ontario government to pay for an expensive autism treatment for children over age six will be appealed, the province said Monday.

While the opposition heckled the Liberals Monday for breaking an election promise to fund the autism treatment past age six, the government said it has increased funding for autism treatment.

CTV News Toronto reporter Paul Bliss said the autism ruling, if upheld, could cost the province $60 million per year.

Ontario's current provincial deficit is estimated at $6 billion.

Gee, $60 million for the kids and their families to help in their education or $60 million for the museum's blob. Life is full of tough choices when you're premier.

For Dalton McGuinty's sake, let's hope my sources are wrong. Otherwise it doesn't paint a very flattering picture of the premier.

When a group a parents of children with learning disabilities wants Dalton McGuinty to keep his promise to help their autistic children, he has to be dragged kicking and screaming into court over the $60 milllion cost, pleading poverty as an excuse to avoid having to pay.

But when the ROM, used to using its charitable tax exempt status to entice donations from Ontario's wealthiest in exchange for the tax receipt, is forced to go to the bank and mortgage its exhibits as collateral for the $63 million loan to cover the extra costs of making a building that looks like a snowflake, well then Dalton McGuinty rides in to the rescue with that $63 million cheque.

I mean, what's $63 million between friends? Maybe the parents of those autistic children should have tried harder to be among Dalton McGuinty's friends.