VANCOUVER'S FINANCIAL DETERIORATION

I just received a package that included a copy of the City of Vancouver Annual Financial Report 2007 with a link to the full report: http://former.vancouver.ca/fs/budgetServices/pdf/AR2007.pdf

Also enclosed was a copy of the 2013 Consolidated Financial Statements with the Link to the full report at http://vancouver.ca/files/cov/2013-annual-financial-report.pdf

If the author's analysis is correct, and it seems to be, then, notwithstanding VISION's claims, the following is the true state of affairs for the City of Vancouver.

Assets have been depleted by nearly 5 billion dollars since 2007, when VISION took over.

Liabilities have ballooned by $800 Million dollars.

Long Term Third party debt has increased by $275 Million.

As of 2013 79% of the debt will mature outside of a five year period.

This analysis is consistent with the following one that was published on Vancouver's debt addiction in mid July, 2014.

http://www.vancouversun.com/opinion/op-ed/Opinion+Vancouver+city+hall+debt+addiction/10032011/story.html

Below is a slightly edited text that accompanied these documents. I assume it has been distributed to others already. The links were correct and the analysis seems also correct.

Dear Sir:

"The following package contains the audited (See Page 9) financial statements for the City of Vancouver in 2007 as well as in 2013. The purpose of your receipt of this package is an effort to demonstrate the corruption and lies that Vision Vancouver and Gregor Robertson have been placing upon the city for the last 6 years.

The Vision Party's Mayor and Council are responsible for the dramatic deterioration of the financial well being of the City of Vancouver. The audited statement of the City of Vancouver for 2007 was the year before Vision was elected.

Page#               2007                              2013                                  Difference

10 * Assets $10.9 Billion                         $ 6.1 Billion                  ($ 4.8 Billion)

• Note 6 references on page 18 of 2013 audit

Page 10 (see “A") demonstrates that the City has nearly $5 billion dollars fewer in assets. 2007 note 4 vs 2013 note 6, the City has $4.2 billion less in land. These are audited financial statements, where has the money and our city's assets gone?

10     Liabilities    $ 1.05 Billion               $ 1.85 Billion (                  $ 800 Million)

It would be expected that the city should have a slightly greater number in liabilities after 6 years. However these increased liabilities are largely in the form of long-term debt and financing. The party is developing massive and unmanageable levels of debt. (See "B"). The next note demonstrates more clearly.

Pages 17&18 Long Term third party debt $ 514 Million       $ 789 Million    ($ 275 Million)

Note “C” demonstrates the excessive debt that Vision Party has built-up, this debt largely matures after 2018. In 2007 the debt was manageable, and the amount maturing outside of a five-year period was only 37% of the total. In 2013, this climbs to 79% - Gregor Robertson is NOT planning for the future.

Since Vision was elected in 2008 the party has controlled all aspects of the management of the City of Vancouver. After Vision was elected in 2008, the Mayor and Council fired the City's manager and appointed a new City manager. Three hundred department managers of the City of Vancouver were fired or retired due to conflicts with the inept management of Vision. The morale of the City's employees is at an extreme low as Vision's policy is that if an employee does not agree with Vision's policy, they are fired. How does this create an open and democratic situation for the city and citizens?

Vision has been in control of the City of Vancouver for 6 years. The coming election could have Vision in control of the City of Vancouver for another 4 years.

Can the residents of the City of Vancouver cope with another four years of the financial and management wreck that is the Vision party?

On a related matter the Supreme Court of British Columbia has held that a lie told by an elected candidate for municipal office is grounds for immediate removal but the application must be filed promptly after the election. http://caselaw.canada.globe24h.com/0/0/british-columbia/supreme-court-of-british-columbia/2009/05/26/todd-v-coleridge-2009-bcsc-688.shtml

PLAYING THE HOUSING MARKET

As I said before, upon receipt of its affordability report the VISION Council or whomever pulls its strings, decided that there was a market rental housing emergency. 

There was at the time no such thing. The problems faced by people who could not find cheaper market rental housing or, for that matter, reasonably priced single family dwellings, was not quite the holocaust the authors made it out to be. It was a market!  

In case the bold, italicized and underlined fonts don't make it clear enough, they were not talking about the mentally ill or the hungry or the homeless. They were talking about the market.

Those who can't find market rentals in  Vancouver find them in surrounding suburbs. Middle class families who can't afford an apartment in Shaugnessy or Kerrisdale are not sleeping under bridges. They are sleeping in Yaletown, the West End, Coal Harbour or even Surrey. That is not a cruel or unusual punishment.

Vision's contribution to policy has been to apply modern social media techniques to politburo politics. It reeks of a Brezhnev era Five Year Plan. It started with the immediate imposition of a uniform standard in all neighborhoods, relating to the distance from certain sized streets. All neighbourhoods near such streets, if the Manager and Council have not noticed, are not alike. Some are ripe for change and others are not.

City Hall aimed a blunderbuss at all residents in Vancouver who happen to live near any street. Any street can be reclassified to an arterial. They created an incentive to consolidate lots in these neighbourhoods. The disruption caused by construction including noise, traffic, loss of trees, blocked views etc. has accelerated. The report called this "making transitional neighbourhoods."   So stable neighborhoods were destabilized into transitional ones.

The Vision Council had no mandate to make these kind of changes. It is ironic that an earlier Council under Larry Campbell held a referendum on whether or not to host the Olympics. By contrast this Council, funded by developers, appointed a gang of them to tell them what they wanted to hear, but has consistently ignored Community Groups from Norquay to Dunbar.

It should not take long for a politician to realize that the democratic process does not end with his or her election. It begins there. These inflated martinets didn't get it.

Hopefully, the election will bring this nightmare to an end. Whomever replaces these people should start with the following:

1. Require an Official Community Plan in all areas of the City. These should be established through local planning offices. 
2. Spot zoning, the practice of rezoning one parcel of land, should be subject to new strict regulations.
3. Discretion in zoning should be brought into line with Development Permits under the Local Government Act so that it is limited to changes in siting but not changes in use or density. 
4. The Affordability programs must be reworked from the ground up. I may have more to say on that later.

THE AFFORDABILITY GAME

Housing affordability is becoming the major campaign issue in the local election. In an article yesterday on the topic, the Georgia Straight summarized the various party platforms on affordability.  The GREEN'S platform can be found at http://vote.vangreens.ca/real_affordable_housing It competently deals with matters that are within Vancouver’s powers. Whether or not they would be effective can be discussed at future all candidates meeting. 

COPE 's platform is available at
  http://cope.bc.ca/platform/housing/ . 

The Party would declare a state of emergency, impose strict rent controls and create a squatters' rights bylaw. 

One way  or another it would increase construction of rental units. These policies and others will quite possibly work to reduce the rate of investment and therefore prices. Investors may take one look, and head for Seattle.

The folks who carefully cultivated the garden of unaffordability  in the first place, VISION, have  produced their Affordability Agenda. http://www.votevision.ca/affordability_agenda It does  everything to make demolishing existing low cost housing stock even more attractive. To understand  VISION's cynical approach one has to look at their bylaw. 

It offers very significant gifts to Developers in terms of extra density and fee waivers to produce units that they call "affordable" but which are anything but. These units are  market rate rental units. Bylaw 10833 and Bylaw 10834 amending By-law no. 9755: A By-law to impose development cost levies in the general area of the city

3.1A Notwithstanding section 3.1, Council waives the levy otherwise required under section 3.2 for construction of for-profit affordable rental housing, which shall mean housing where:

(a) all dwelling units in the building are rental units;

(b) no dwelling units are strata units;

(c) the average size of the dwelling units is not greater than:

(i) 42 square meters for studio units,

(ii) 56 square meters for one bedroom units, or

(iii) 77 square meters for two bedroom units,

except that the floor area used for stairways within two bedroom townhouse units of two or more storeys is excluded from the calculation of maximum unit size;

(d) agreed upon average rents per unit type for initial occupancy do not exceed the following specified rents:

(i) $1,443 per month for studio units,

(ii) $1,517 per month for one bedroom units, or

(iii) $2,061 per month for two bedroom units,

except that such rents shall be adjusted annually on January 1 to reflect the change in average rent for all residential units built since the year 2000 in the City as set out by the Canada Mortgage and Housing Corporation in the Rental Market Report published in the previous calendar year;

To be clear, VISION's  "affordable" housing is 

1. at very high market rents
2. subject to annual rent increases
3. extremely small
4. subsidized by the taxpayers.

                               Future affordable housing
                                 Versailles, France

VISION's  justification is voodoo, trickle down theory: As the new housing ages it will become cheap and run down, and then become affordable and converted to low cost housing  just as has not yet happened to Marie Antoinette's Palace at Versailles 

The distrust of VISION was palpable at an all candidates meeting at Killarney Community Centre on October 8. All others were given warm receptions. The other parties must have felt that with enemies like that who needs friends.  

The NPA and the other parties are now  in a position to show how the bylaw can be used to produce affordable housing. I would say now is the time to do it.

Vancouver is not the only city trying to deal with the loss of community caused by allowing housing to be turned into investment instruments. It does seem to be the only City, however, that has attempted to solve the problem by Orwellian Newspeak. It has redefined the word unaffordable to mean "affordable."

In Vancouver, developers and their drum majors, the Mayor and Council, join in an orgy of development in one of many Cities in the world  swamped by cash from investors seeking a safe port in a storm.

The CBC has done a good review of how other cities and countries have tried to deal with this isue.  http://www.cbc.ca/news/canada/real-estate-rules-don-t-discriminate-against-foreigners-1.1216517

Foreign investors in London’s toney areas have bought up houses and kept them empty. It reached the point where a city Councilor said,

“Housing costs and availability are consistently one of the biggest concerns for our residents and we believe we have reached a crisis point in private rental sector housing in the borough.”

Owners of empty properties were being charged 50 per cent extra. The number of long term empty houses quickly fell. See

http://www.telegraph.co.uk/property/10250884/Empty-home-owners-face-ghost-town-tax.html

An article appeared in the Far Eastern Economic Review in June 2009 by Patrick Chovanec, China’s Real Estate Riddle” http://chovanec.wordpress.com/2009/06/11/chinas-real-estate-riddle/ explaining cultural attitudes towards investment. Chovanec, then a professor at Tsinghua University's School of Economics and Management in Beijing, China said this:

“In China, real estate—occupied or not—offers them a visibly reassuring place to park their money, sheltered from inflation. *** with little or no holding costs, Chinese owners are unconstrained by the need to make the property “pay” in cash or in kind. For them, an empty condo is a store of value, much like gold, another asset that performs no practical function besides retaining its worth….. Apartments in China aren’t for living in, they’re for investing. That is the real source of demand.

Empty roads in Zhengzhou, China

http://www.wnd.com/2012/07/bizarre-chinas-eerie-ghost-cities-arise/

Vancouver voters are split almost evenly between renters and owners. In our at large system therefore, any party must meticulously calculate what does what to whom. Rent controls, for example, create long term shortages in rental properties but may be irresistable to tenants at election time.

Nothing is as nervous as a million dollars. Restrictions on foreign investment and efforts to tax vacant properties will likely cause a rapid drop in the values of some properties as investors head to countries that have not imposed those measures. 

Density incentives that result in towers or laneway homes in neighborhoods of detached homes can gain votes from those homeowners who want to build them but anger neighbours whose views are blocked.

Hopefully the NPA will produce a thoughful affordability platform in the next couple of days.So far the parties have been offering  freebys to their constituents. The GREENS will provide protection from reno-victions. COPE  will implement rent control. VISION will give developers everything they want including free swimming lessons. 

There is always free cheese in a mousetrap.

VOTING WITHOUT THINKING

Malcolm Gladwell’s book, Blink, the Power of Thinking Without Thinking is about the remarkable accuracy of intuition. He explains how the first 2 seconds of a meeting convey impressions and hunches that can be more reliable that careful studies and conscious strategies. 

Voters’ decisions in local politics are likely to be intuitive. Campaigns do not really get underway until a week before an election. Under an at large system, a week is not much time to know much about dozens of candidates.

Chapter 3 of Blink is entitled, The Warren Harding Error. It describes why intuition sometimes goes wrong, particularly in politics.

The first president to visit Vancouver was Warren Harding. There are no statues of Lincoln or Roosevelt here but there is a statue of Harding in Stanley Park. Harding has been considered by historians to be one of the worst presidents in US history. He died shortly after his visit to Vancouver. 

Harry Daugherty, a lawyer and lobbyist, was the classic behind the scenes fixer and a shrewd judge of political opportunity. He ran into the 35 year old Harding while he was having his shoes shined. Daugherty took one look and concluded that he could make him president.

Harding  had it all...well almost all.  He had charm, looks and a great speaking voice. Also he was not very bright. As he rose from one local political office to another he remained safely undistinguished. His speeches were described as an army of phrases searching for an idea. As he grew older, however, he became better and better looking. He could have played Julius Caesar on the stage. Although Harding was unburdened by accomplishments, Daugherty persuaded him to run for the White House, believing that he would make "a great looking president."

So Harding got the Republican nomination and was elected. He was the first president to use modern public relations techniques. Five thousand speakers were trained  and sent abroad to speak for Harding; 2,000 of these speakers were women. Telemarketers were used to make phone conferences with perfected dialogues to promote Harding.

Gladwell states, "Many people who looked at Warren Harding saw how extraordinarily handsome and distinguished looking he was and jumped to the immediate and entirely unwarranted conclusion that he was a man of courage, intelligence and integrity. The way he looked carried so many powerful connotations that it stopped the normal process of thinking dead in its tracks.

The Warren Harding error is at the root of a good deal of prejudice and discrimination. It is why picking the right candidate for a job is so difficult and why on more occasions than we may care to admit, utter mediocrities sometimes end up in positions of enormous responsibility."

Harding was loyal to his friends even though they were bad news. Of them he said, “I have no trouble with my enemies, but my damn friends, they're the ones that keep me walking the floor nights!"

Secrecy

He appointed many of his pals and campaign contributors to prominent political positions in control of vast amounts of government money and resources. They were a corrupt gang. Operating in secrecy, they negotiated leases and took gifts. 

One of his friends was ultimately convicted of accepting bribes and illegal no-interest personal loans in exchange for the leasing of public oil fields to business associates. Albert Fall was the first cabinet member in U.S. history imprisoned for crimes committed while in office. Charles Forbes, one of his buddies appointed to the department of Veteran Affairs received traveling perks and alcohol kickbacks, took a $5,000 bribe in Chicago, and made a secret code to sneak through $17 million in government construction hospital contracts with corrupt contractors.

Harding died a month after his visit to Vancouver. Some claimed it was food poisoning, others said it was suicide but recent evidence is that he had a serious heart condition that was misdiagnosed.

The secrecy unraveled and scandals and corruption came to light after he died.

Moral

There is no substitute for learning everything one can about the full slate of candidates. 

Our forthcoming Vancouver election will be a challenge if we accept Gladwell's observations. All candidates - not just Mayor Robertson - are  good looking people. The Harding effect can turn the election into a beauty pageant where the candidates compete making vacuous promises to bring world peace, to repeal the internal combustion engine and to always look  good in swim suits.

GHOST STORY

Harry Rankin was the founder of the Committee of Progressive Electors (COPE). He ran 12 years in a row before finally getting elected  in 1966 as an independent. 

Over the next twenty years Rankin became the most popular alderman in the City. The NPA controlled the other seats but there was a reservoir of affection for Rankin. When election time rolled around the voters who worried about the 'Socialist Hordes at the gate' always "Saved one vote for Harry to keep 'em honest." 

In 1986 Harry ran for Mayor against the NPA's, Gordon Campbell. Harry lost.  In 1988 he regained his council seat. 

Why was he so popular?  He was very funny, highly intelligent and, although he did not suffer fools gladly, showed a streak of kindness to everyone including, on rare occasions, the opposition.

Paradoxically,  Rankin and COPE  for all their socialist rhetoric were extremely cautious.  COPE's acronym was parodied as “the Committee Against Practically Everything.” 

He was the Councillor who most carefully analysed  expenditures. He insisted that the City should only undertake  projects that free enterprise could not do. He was sceptical of most government initiatives because he feared City Hall's propensity to screw things up. When  Council created the position of "children’s advocate" Rankin suggested that for all the good  she was doing,  she might be a valuable source of protein for hungry kids in school.

He refused to attend Expo 86. He referred to the Federal Granville Island development as a "boondoggle". Ditto for Granville Mall. He was ice cold to the Vancouver Land Corporation, the purpose of which,  was to supply market rental housing on City owned land. He dismissed it as "state capitalism."

Rankin served on Council until 1993. He ultimately quit his party in disgust in 1996.  He considered that it had been hijacked by witless opportunists-the same ones who ultimately morphed COPE into VISION. 

When he died in 2002 there was a demand that the flag be lowered to half mast. The Council of the day declined ('if we did it for him we'd have to do it for everyone') but miraculously it lowered itself and stayed there for a week.

Tim Louis articled with Rankin. He and mayoral candidate, Meena Wong, seem to be trying to return COPE  to its roots. Their platform is left-wing and has some strange elements but don't sell COPE short. The party could regain the votes usurped by VISION when it abandoned Harry and lost its soul.

YOUNG DEVELOPERS vs OLD FOLKS IN WALKERS

The bitter laments of young developers at an Urban Development Institute panel discussion,  to the effect that old folks in walkers were giving them the miseries by failing to appreciate their good works, is astonishing.

 
http://vancouver.24hrs.ca/2014/09/18/developers-cry-foul-on-vancouver-nimbys

https://mail.google.com/mail/u/0/?hl=en&shva=1#inbox

*** the 34-year-old president and CEO of [ the company] spearheading the Trump Tower in Vancouver — said he almost wants to leave and open shop in another country because developers are rarely recognized locally for their good work.“We as developers are painted as bad people, that we are making windfall profits all the time,” he said.“We try our best to contribute back to the communities and neighbourhoods and shape our city, but we’re hated by everyone else.”

***“We have lawsuits filed by residents associations that are completely log-jamming legal services at the City of Vancouver,” he said.“The people who show up are literally in walkers and canes. ***

“*** I don’t have time to go and attend these planning sessions... and the people who do have the time aren’t going to be around to see the plan implemented.”

Before zoning, first introduced to North America in Euclid N.Y. in 1924,  land use was governed by private restrictive covenants.

Covenants controlled everything including the acceptable ethnicity of residents permitted to buy into  developments. 

The case of Fleischman v. British Pacific Properties Ltd. [1997] B.C.J. No. 2838 reveals how the system works to this day.

In 1984 Mr. Fleischman purchased a one and one-half acre property in West Vancouver. He wanted to subdivide the lot in order to construct a second, smaller, home.

The respondent in the case, British Pacific Properties Ltd. was incorporated in 1931. B.P. acquired a large tract of undeveloped land which it has developed and sold, one subdivision at a time. .There are 814 homes on 1500 acres.

Each subdivision is subject to a "Building Scheme" consisting of a number of restrictive covenants. Mr. Fleischman's filed an application to the Developer, B.P.  but the plan was refused by the Managing Director.

The first thing to note here is that this is a quarrel between a resident owner who wants to build a small second  house and the developer who wants to stop him. This is the reverse of what has been happening in Vancouver. The developer is the NIMBY or, more properly, NIYBY.

Why would the developer, BP do that?  Why would he choose to pick on the  homeowner and prevent him from building his second house?

If one were to accept the theory of the tadpoles at the Urban Development Institute it is probably that British Properties is run by demented nonagenarians scuttling about in walkers. They have nothing better to do than to torture young developers with their regulatory obsessions.

Another possibility is that the Developer wants the rules enforced because it it was and remains in his best interest to do so. 

Here is what the court said:

“6.      The purpose of the restrictive covenants is to create and maintain a unique residential environment, which will maintain and enhance property values and ensure the continued desirability of the British Properties as a residential area.”

The purpose of land use controls - both zoning and private building schemes - is to enable developers to sell their developments. Who will buy an apartment in a building for a million dollars if the rules on the lot next door will suddenly allow a building with Beijing densities to abut against it? 

There is no room for uncertainty in land use law.

If there were no zoning today, these same Developers would be forced to create their own private building schemes in which either the company continues to administer the system, or the covenants are reciprocally enforceable by homeowners.

The willingness of our Vancouver government to treat the established city as though it is raw land that is available for  redevelopment is contrary to the interests of everyone including developers. Of course, if their purpose is not to create housing but simply investment instruments that no one lives in, then the attitude makes more sense.

HIGH ANXIETY OVER THE ARBUTUS CPR LINEAR TRANSIT BIKE THING

Vancouver has been able to avoid buying the CPR right of way because 8 years ago the City got lawyered up and won its expropriation case. [ Canadian Pacific Railway Co. v. Vancouver (City), 2006 SCC 5] The Supreme Court of Canada held that the Official Development Plan (ODP) merely freezes the use of the land with a view to preserving it for future development by precluding present uses that might interfere with that development. The City is not obliged to compensate CPR for the land even though the CPR said  in 2006 that it was no longer useful as a transit corridor.

Since then the old corridor has been used by trespassing gardeners. The City treated  it with benign neglect. They didn't have to buy it and the CPR could run trains up and down for fun if they liked.

When development obsessed, VISION started their mass rezonings the CPR hit upon a strategy borrowed from Mel Brooks in his Hitchcock parody, High Anxiety. Brooks’ character, a psychiatrist and Madeleine Kahn are in the airport toting guns. They need to get through customs. Brooks tells Kahn, counter-intuitively, that instead of avoiding attention, she should be as obnoxious as possible. They both become quite disgusting. The security is so turned off that they push them, with their cargo of weapons, onto the plane.

The CPR after carefully studying High Anxiety announced that they were going to run trains from here to there on their tracks. Pursuant to Mel Brooks’ strategy, they trampled the farmers cumquats and bulldozed their fences. Their next act would likely involve blowing horns at midnight or a food fight out of Animal House.

Lets suppose that Council's very own psychiatrist, Kerry Jang, possibly a student of Brooks, is planning the next move. I have never met a psychiatrist I couldn't help, and this is what I would suggest.

"Professor Jang, there is an election coming up and you incumbents have a dilemma. If  you do nothing other than say things like, “That’s no way to run a railroad!” you will seem weak and ineffectual in the face of the CPR’s brutish behavior."

"If you agree to a price or even compromise with the CPR, it will seem like you are rewarding pigs with breakfast."

Then I would tell him that the Expropriation Act offers a solution that allows both sides to win and the public to lose. Section 3. (1)  would allow the CPR to agree to transfer land to the City without going through the full expropriation process. If they cannot agree on the price the City can pay a tiny fraction of its fair value to the CPR. That would all happen before the election. The VISIONISTAs would trumpet their business acumen: "We paid $500 dollars and they accepted. Ha. "

The farmers, who have been described by Pete McMartin as Marxists, would thank the council commissars

The CPR’s wax mustachioed executives would slink out of town.

Scene 2 would occur long after the election. A hearing would take place before a judge as required by the Expropriation Act and based on appraisal evidence would set the price for the sale as of the date the owner agreed to transfer  the land to the city.

The Expropriation Act states that the court must award as compensation the market value of the owner’s estate or interest in the expropriated land *** In determining the market value of land, account must not be taken of (g) any increase or decrease in value of the land that results from the enactment or amendment of a zoning bylaw, official community plan or analogous enactment made with a view to the development in respect of which the expropriation is made.

There are also special provisions for unique properties like railroad right of ways and abattoirs.

After the purchase and the election, the City could repeal or amend the OCP anyway it liked. The change would not affect the cost of the purchase. What is likely to happen, though, is that the City would have to pay much more than what it has been calling “fair market value.” The CPR would get fair market value.

You can bet that at midnight when the Supreme Court delivers the next CPR decision, the VISIONISTAS will not let the railroad turn back into a pumpkin patch. A strip casino will be more like it.

If they manage to get re-elected in November by a heavy turnout of kale growers and residents on Point Grey Road, the public will promise not to vote for them when the next election rolls around in four years.


Note: Since writing the above I have been asked whether the City has the power to expropriate. This is a complicated issue but the CPR seemed to think so. It argued in CPR v Vancouver SCC 2006

35     CPR also argues that the British Columbia Expropriation Act, R.S.B.C. 1996, c. 125, requires the City to compensate CPR (Appendix B). Section 1 of the Act defines "expropria[tion]" as "the taking of land by an expropriating authority under an enactment without the consent of [page241] the owner", and goes on to define "expropriating authority" as "a person ... empowered under an enactment to expropriate land". Section 2(1) of the Act provides that "[i]f an expropriating authority proposes to expropriate land, th[e] Act applies to the expropriation, and, if there is an inconsistency between any of the provisions of th[e] Act and any other enactment respecting the expropriation, the provisions of [theExpropriation Act] apply." The Expropriation Act requires compensation for land expropriated, while the Vancouver Charter states the City is not obliged to compensate for adverse effects to land caused by an ODP. CPR argues that this constitutes an inconsistency and that, under s. 2 of the Expropriation Act, the requirement of compensation in that Act must prevail.