A retired Royal Canadian Air Force officer who is facing a $200,000 lawsuit for defamation by the Niagara Peninsula Conservation Authority brought a battalion of supporters to the group's annual general meeting Wednesday.

Ed Smith, a 25-year veteran who served in Bosnia and as a UN peacekeeper in South Sudan, received raucous applause from a throng of protesters who chanted: "Drop the suit."

The Niagara Peninsula Conservation Authority (NPCA) filed a suit against Smith, 55, in November after he publicly questioned the board's ethics, especially connected to its hiring of board members and a proposal to "sacrifice" prized Carolinian swampland to development.

The NPCA oversees 39 conservation areas and trails in a watershed — which includes parts of the City of Hamilton, the county of Haldimand and the entire Niagara Region — and is funded by close to one million taxpayers.

The Wainfleet Bog is among the properties in the NPCA watershed. (Supplied)

In the fall, Smith came under fire after publicly issuing a 45-page report that levelled allegations of corruption and mismanagement against the NPCA. The St. Catharines man alleged that the authority's board members — among them municipal politicians — received contracts and other paid positions within the authority, and used those positions to push a pro-development agenda.

Smith's report suggested that changes at the authority began four years ago as development-minded politicians ended up filling its board.

That, the report alleges, led to two of those board members — Carmen D'Angelo and current Niagara Regional Coun. Dave Barrick — getting high-profile jobs with the authority. D'Angelo became the board's chief administrative officer, but resigned in November when he accepted the position of CAO of Niagara Region.

'The canary in the mine'

Niagara Coun. Bill Hodgson, however, has been a dissenting voice on the NPCA board — and said he objects to the new focus on development.

Bill Hodgson, NPCA board member, called for an operational review of the board with the possibility of calling in a provincial auditor. It passed 14-1. (CBC)

"When they're prepared to hire someone off of their board, without work experience and [without] the right professional accreditation, it's the canary in the mine for me," Hodgson said in an interview Wednesday. "If someone's prepared to do that — and not see that as a problem — you have to worry about what other judgment is involved."

It was in 2013, that the authority began to dismiss a third of its employees, Smith alleged in his November report to council.

Many of those who were fired had been conservation stalwarts and the board replaced them with people willing to follow a pro-development agenda, he and several activists allege.

Prioritizing development

In early 2015, D'Angelo and Barrick began lobbying the provincial government to make Niagara a testing ground for a controversial concept known as biodiversity offsetting — an idea, presented in a provincial report on wetlands protection, that it's fine to destroy a natural habitat in one area as long a new habitat of equal or greater size gets created somewhere else.

The authority hired a lobbying firm to help make its case.

Barrick, director of corporate services for the authority, said he could not comment on either his own hiring in January 2014 — or about hiring the lobbying firm. Instead, he referred questions to the NPCA communications head.

The Niagara Peninsula Conservation Authority is suing Ed Smith for making public allegations about its commitment to development and questioning its hiring practices. (Doug Draper)

But Michael Reles also told CBC News that he also could not comment on either human resources issues or what he called a confidential agreement with the lobbying firm.

Instead, he said the discontent comes from environmentalists who believe that the conservation authority should solely be an advocate for the environment.

"We are here to enforce legislation," he said. "We will continue to be leaders in accountability and transparency in the province."

'Sacrificing' swampland for development

NPCA board member and Niagara Falls Mayor Jim Diodati joined Barrick and D'Angelo in lobbying the province in 2015 to launch a pilot project on biodiversity offsetting using lands adjacent to Thundering Waters Golf Club. Those lands are part of a $1.4-billion development proposed by Chinese investors to create 10,000 housing units on the southern edge of Niagara Falls.

Wetlands are an essential component of Ontario's biodiversity. - Natural Resources and Forestry Minister Kathryn McGarry

Environmental experts, however, say that part of the property is a slough forest, with rare species of roundleaf greenbrier, and a good breeding ground for salamanders and other amphibians.

And Natural Resources and Forestry Minister Kathryn McGarry has told the NPCA that destroying one habitat and replacing it with another is not consistent with provincial policy, she said in a statement to CBC News Wednesday.

"Wetlands are an essential component of Ontario's biodiversity," the minister said.

Forensic audit

At least nine of the municipal councils within the Niagara and Hamilton regions are asking the province to do a forensic audit of the NPCA. Board member Hodgson moved for a third-party operational review Wednesday, with a request to draw in the provincial auditor, if possible. The motion passed 14-1.

That audit should review the authority's finances as well as its hiring practices, Welland NDP MPP Cindy Forster said after the meeting.

"I've heard from board members who say, 'We've gone in a new direction to balance conservation with the economy,'" Forster said in an interview. "But there isn't anything in the Conservation Act that says you even need to look at economic interests — it's totally about protection of wetlands and the environment."

In his presentation both to council in November and at the meeting Wednesday, Smith begged the conservation authority to try to regain the public trust.

Local businessman Frank Trivieri said the authority should abandon the lawsuit against Smith — and instead adopt his sense of morals.

"This guy has a strong sense of ethics, of what's right and what's wrong," said Trivieri. "All he did was ask questions all of us wanted answered."