BC Rail Deal Frees Real Estate

Deny, deny, deny. That pretty much sums up Premier Gordon Campbell's communications strategy concerning an RCMP investigation into two B.C. Liberal legislature officials for breach of trust.

In a stunning television sound bite, Campbell even suggested that the whole affair had nothing to do with his government.

This astonishing claim followed the release of a summary of search-warrant information. It explicitly stated that the investigation focused on whether or not offers were made and/or accepted "as consideration for cooperation, assistance or exercise of influence in connection with government business, including BC Rail".

Nobody has been charged with a criminal offence, and perhaps nobody will ever be charged. The search-warrant information states that no elected officials are targets of the investigation.

However, even if charges are laid, there is no guarantee that a criminal trial will shed any more light on the $1-billion sale of BC Rail shares to CN. In a criminal case, the Crown's only responsibility is to prove that the accused are guilty of specific offences beyond a reasonable doubt. The accused cannot be compelled to testify.

Only a broader public inquiry, in which a commissioner has subpoena powers and witnesses testify under oath, has any hope of ferreting out the truth about the decision to privatize BC Rail.

Consider the facts so far. Prior to the election, the premier told voters that he would not sell the Crown-owned railway. What led him to change his mind?

According to a fairness commissioner's report, some unsuccessful BC Rail bidders expressed concerns that information pertaining to their own interline agreements with BC Rail had been improperly or prematurely provided to CN.

One of the bidders, Canadian Pacific Railway, formally withdrew from the process after complaining about a "breach of fairness".

CN has contributed $150,000 to the B.C. Liberal party during Campbell's tenure as leader.

Meanwhile, a Crown corporation that manages public-sector pension funds, BC Investment Management Corp., owned $200 million in CN shares as of March 31, 2003.

CN chair David McLean, a Vancouver developer, has been a political supporter of the premier since Campbell was mayor of Vancouver in the 1980s and early 1990s.

McLean was previously chair of Concord Pacific, which also supported Campbell when he was mayor of Vancouver. Concord Pacific developed the north side of False Creek.

McLean also chaired the influential Vancouver Board of Trade in 1992탔ší‚ ­93 and supported Campbell's efforts to replace Gordon Wilson as leader of the B.C. Liberal party.

On November 25, the B.C. Liberal government announced in a news release that it had reached an agreement-in-principle with the District of Squamish to transfer 29 hectares of BC Rail land to the district.

According to the news release, prospective plans for the BC Rail site include developing a full-service marina, a passenger ferry terminal, and cruise berths.

The government also announced that CN will "facilitate" upgrading of the Sea-to-Sky Highway and ensure rail alternatives for the 2010 Winter Olympics. McLean was a director of the Vancouver 2010 Bid Corporation, which put together a successful bid to the International Olympic Committee.

The major provincial media continue focusing on the activities of political aides at the centre of the story. There has been little coverage of BC Rail's waterfront property in Squamish.

As the District of Squamish proceeds, there will be no shortage of developers wanting to exploit the potential. B.C.'s biggest players, such as Concert Properties and Concord Pacific, may find such an opportunity irresistible on the eve of the 2010 Olympics.

Executives with both companies were huge supporters of the Olympic bid. Concert Properties chairman Jack Poole is now chair of the organizing committee that is staging the 2010 Winter Games.

The IOC's endorsement last year set the stage for a real-estate boom along the Sea to Sky corridor.

So far, there is no evidence linking the privatization of BC Rail with the Olympic bid.

The premier had better hope this remains the case, because Vancouver will be hosting reporters from around the world in 2010. And it won't help B.C.'s image or the premier's reputation if the selloff of a Crown-owned railway becomes the big story of the games.