Rothmar Holdings Suing City of Cornwall Over Denied Building Permits

Krystine Therriault - Seaway News
Rothmar Holdings Suing City of Cornwall Over Denied Building Permits
(Photo : Krystine Therriault/Seaway News)

Seaway News has been watching the unfolding tensions between the city, Rothmar Holdings, and downtown businesses for a few weeks. I have met with Aaron Bell, emailed with Mark Boileau, and spoke with several downtown business owners as well as councillor Justin Towndale to try to get a complete picture of what is going on.

Local developer Rothmar Holdings has been committed to developing a mix of commercial and residential properties downtown since 2019. However, since late 2021 Rothmar has had almost all permits they have applied for denied by the City of Cornwall, affecting the company’s own bottom line and putting several local small businesses at risk.

In the beginning, Rothmar Holdings and the city had a good working relationship.

Rothmar Holdings didn’t build up a portfolio of 20+ residential and commercial buildings in Cornwall without receiving prior permits and support from the city.

In November 2020, Rothmar’s CEO, Aaron Bell, had a meeting with Mark Boileau, Mellissa Morgan (social housing), Carmen Cousineau (Cornwall housing), and Kat Rendek (economic development). Rothmar Holdings pledged to build 200 affordable rental units by 2026. They received a follow-up email from the city the next day but there was no further follow-up afterwards.

According to Mark Boileau, General Manager of the Department of Planning, Development and Recreation, “On the subject of 200 rental units in the downtown, the City has worked with the developer on a number of properties in the downtown and Le Village over the last few years, contributing grants and interest free loans through the Heart of the City CIP program.  In addition, the City has developed in the last year a program specifically regarding affordable housing on six properties, three in the downtown and three in Le Village, with considerable tax benefits to create more affordable units in the City’s core.  One of the three downtown properties belonged to this developer, however it was recently sold. The four properties filed by the applicant with the Ontario Superior Court would yield twelve units in total, and we have no information that would substantiate that these would qualify as affordable housing.”

Not long before this meeting, in late September/early October 2020, the city approached one of Rothmar Holdings’ sister companies about purchasing a property they own on Marleau Avenue.

“The land on Marleau, they’re widening the road there. We don’t have any issues giving it to them. In fact, we don’t really have a choice. If it goes to expropriation the city has the right to take the land. But the expropriation act is very specific. It provides rights to the city so that the city can expand, but it also provides very clear rights to the person whose land is being taken,” explained Aaron Bell, “I don’t pretend to be a lawyer … so we hired a firm to protect our interests. It seems to have caused some concern with the city that we did that. I was told directly from Mr. Boileau that in 35 years he’s never has to go through expropriation and he’s not about to start now.”

Since then, they’ve had one permit denied after another. So much so that the company has halted all work in the city until this gets resolved.

Several people in town have now heard of Happy Popcorn Company’s hopes to build a family entertainment center in the basement of the building they are currently located in, but because of the ongoing permit issue between Rothmar Holdings and the city, those plans are also put on hold indefinitely.

“In regards to the permit issue, it is our sincere hope that our landlord and the city can resolve the issues in front of them and get back to the business of helping Cornwall grow,” said Happy Popcorn co-owner Bill Halman, “A number of our downtown neighbours are in limbo waiting to open their doors and we want them to have the opportunity to do so soon, especially with the holiday season around the corner. With their success, comes our success.”

After trying to communicate with the City on these issues and not getting a response, Rothmar Holdings’ CEO Aaron Bell has decided to turn to the Supreme Court of Ontario for help moving these projects along. It’s an unusual move since building permit disputes are usually brought to the Building Code Commission, but he hopes to resolve everything more quickly this way so he can get back to work and his tenants can continue to run the businesses that support their families.

Aaron Bell submitted the first court application for 100 Pitt Street on February 10, 2022, and eight months later City Council is just learning that the city is being sued because of media coverage. After having several other permits denied by the city, Rothmar has filed three more court applications since June 2022.

“If you’re mad at me your actions aren’t just affecting me, they’re affecting the whole downtown. I would argue that they’re affecting the whole city because the less units we build the higher rents are.” said Rothmar Holdings CEO Aaron Bell, “If you keep the demand high, you’re just pushing the price of rent higher.”

Echo Trends Suzanne Prosser Dexter has been a fixture downtown for two decades.

After ending her lease at her old location across from the Cornwall Square, she signed on to be one of several small businesses to move into the vacant building next to Kastners. When that didn’t work out, she signed a lease at 155 Pitt, the former site of Truffles Burger Bar – but has still not been allowed to open her doors.

That permit was applied for on May 1st and denied May 31st, longer than the typical 20-day limit for commercial building permits.

“This is my livelihood. We have been part of the downtown for almost 20 years, and now because of lack of answers and clarifications from the city, I am at risk of losing my business,” Suzanne told Seaway News.

She added, “They have shown no support, they don’t even respond. I have been laughed at and ignored by the people whose job it is to help.  It’s really not ok. After speaking with other business owners and residents, we have realized we’re not alone. Something has to change, or we will lose what little we have. We all would like to see this city grow, improve and flourish. Who will want to open a business in Cornwall when our own local contractors and developers refuse to work here.”

Total Cyclery is another local business that has been in limbo due to a permit that was approved, and then revoked.

The 100 Pitt Street permit was applied for on August 16, 2022. The permit was originally approved on September 14, 2022, and then revoked a day later.

“So, we received a permit,” said Bell, “That’s one of five, but that’s the first one we received in all of this. The permit came in Thursday about 3:10 pm. Friday at 4:32, two minutes after the city closes, the permit was revoked, which I have never seen before. None of any of my professionals. My lawyers have seen it once so it’s not a common thing.”

Because of this back and forth with the city, Total Cyclery was forced to stay in a building that is set to be demolished. They had a break-in, so they currently have a broken window boarded up with plywood and are using a space heater to keep warm, because there is no gas.

Happily, at the time of publishing, Seaway News has learned that the permit for Total Cyclery has been approved (with no changes) and they hope to be in their new location within the next month.

A meeting held on Tuesday, October 11th between concerned business owners, municipal candidates, and councilors showed that this is not an isolated occurrence.

Other businesses outside of Rothmar Holdings’ tenants have had issues opening their doors because of mixed messages and delays from the city’s Building Permits department.

Some have even been forced to leave town and open shop elsewhere. This was the case with Robbie Laroche of Dish Wish. After facing multiple issues getting a permit in town, he moved his business to South Glengarry where he received the support and information he needed to open his doors.

Now small businesses are joining together to demand answers from the city, who has stayed relatively quiet on the issue at hand thus far. Many windows downtown now feature ‘Permit Me’ stickers with white hard hats to show support for the businesses who are not able to get the permits they need to open.

These businesses have stressed that they aren’t asking to bend the building codes but want a more open dialogue with the permit department to find a way to make things work. They’re also asking for a timelier approval process and more professional customer service from city staff.

A letter sent to key political leaders across the province was sent out on Monday, October 17, 2022, urging provincial government to step in and rectify these issues.

“If the Municipal and Provincial Governments do not take immediate steps to resolve the issues faced by residents, business owners and developers, real and serious harm to the local economy, access to housing and social/recreational amenities may occur,” the letter states.

The Cornwall and Area Chamber of Commerce has also released a statement:

“The Cornwall and Area Chamber of Commerce would like to acknowledge the ongoing issues businesses are facing regarding permits and regulatory compliance with the City of Cornwall. The Cornwall and Area Chamber of Commerce will intently monitor this situation and continue to advocate for the needs of our members and nonmembers alike to ensure our region has a fertile entrepreneurial ecosystem. We look forward to an amicable resolution between the City of Cornwall and the affected local businesses. We will keep our members apprised of any developments. If any businesses would like to discuss specific concerns with the Chamber please reach out to us directly.”

While it appears that the city’s relationship with Rothmar Holdings has soured recently, there is a bigger issue here than just this one developer. Hopefully, this week’s municipal election results in some much needed changes so Cornwall can get back to being the city of possibilities that it claims to be.

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