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Faro pushes ahead with daycare sale

Faro is still set on completing the controversial sale of its daycare building to one of its employees. The lot and building were originally assessed at $80,000.

Faro is still set on completing the controversial sale of its daycare building to one of its employees.

The lot and building were originally assessed at $80,000.

The town is proposing to subdivide this lot and sell the empty section for $20,000 to Public Works and Government Services Canada for use as RCMP housing.

The remaining building and lot will be sold for $10,009.12 to Kerry Wagantall, a town employee, and his wife Helen, the sister of councillor Diana Rogerson.

Faro does not have any conflict-of-interest policy (or any other policy) in place that prohibits employees from bidding on tenders.

This is true of other Yukon municipalities as well, said Mayor Heather Campbell, who responded to questions via e-mail.

She feels that the town would benefit from some sort of conflict-of-interest policy.

The mayor plans to go through with the sale, pending the successful subdivision of the lot by land planning.

The decision will be known sometime after June 14.

At that time, council plans to rezone the lots from community use to residential.

Council tried to rezone the lot during its January 19 meeting.

However, the bylaw wasn’t given a first reading.

The meeting was attended by about 24 people and not many expressed displeasure with the sale, said Campbell.

However, the meeting stretched until 12:50 a.m.

Afterwards, council went into an in-camera meeting where CAO Rose Price was suspended for, among other things, “questionable hiring practices and the supply of incorrect information to the residents of Faro,” according to her suspension letter.

The mayor declined to comment on the suspension, as it is a personnel issue.

Price resigned from her position on April 16.

According to Faro resident Inge Kvemo, there was a lot of dissent at that January meeting.

Brian Bekk submitted a letter to council, stating the sale was handled “in a manner that leaves many people feeling that something underhanded has occurred.”

Bekk only heard about the call for expressions of interest in the daycare after the deadline had passed and doubted whether the sale was in the best interest of the town.

“This is not the first time a town employee has acquired a maintained building for $10,000,” he wrote.

“Even if everything has been accomplished above board, this is not the impression that is being given.”

Former town CAO Hermann Minderlein bought a fourplex in town for $10,000 back in January 2006.

The fourplex was worth $223,785 when it was owned by Faro Real Estate in 1986.

In 1992, it was transferred to Yukon Housing Corporation and valued at $80,000.

The steep decline in price was because the building had been uninhabited and uncared for, said Minderlein.

It had been vacant for three to four years and unheated.

There were leaks in the water pipes, the paint was peeling because of the cold, there was mould and the flooring had to be replaced, he said.

It took two or three months work just to get one of the better units ready for his daughter to move into.

Minderlein currently has the property up for sale.

He’s asking $65,000 for it.

A lot of the work he and his wife did on their own, but he estimates he put about $40,000 to $50,000 into the structure, including new appliances and flooring.

Minderlein was CAO from 2006 to 2008.

He bought the house from the Yukon Housing Corporation.

Even though the mayor at the time was also a representative of Yukon Housing she had nothing to do with the sale, he said.

“It was all basically handled by the Yukon Housing office in Whitehorse.”

Minderlein saw the notice on the bulletin board in the town store and decided to make a bid.

“We knew it was a very low bid,” he said.

“It was based on cash availability, we put our best offer in and got lucky.”

The sale of public buildings at bargain-basement prices doesn’t undercut the real estate market in town, said Minderlein.

“Then there’s the maintenance costs and upkeep of those buildings. There must be a value in trying to dispose of it, rather than letting it go down to zero value.”

Bekk’s concerns about the sale were addressed to his satisfaction during the January 19 council meeting, said Campbell.

“Mayor and council have repeatedly publicly acknowledged that there were things that could have been done differently during this process.”

The process was put on hold pending legal review from January until March.

Afterward, council agreed that “moving forward was more positive and viable option than beginning the process over again or cancelling the process altogether,” she said.

The daycare building had not been used for three years due to lack of demand.

However, in the past two months, a new privately operated children’s day home has opened up in town “and is proving quite successful,” said Campbell.

“They all agree that using the existing facility would not be financially feasible due to the cost of upgrading it and operating costs.”

“Any council is bound to make decisions that do not please everyone,” said Campbell.

“Faro is a wonderful community, but unfortunately we have a few critics who feel being heard is a more important objective than being patient as we orient ourselves to our new positions.”

Contact Chris Oke at