The meeting that left the GMHI eight ball still on the table

By Gerry Barker

February 17, 2017

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Thank goodness there were eight councillors who voted not to sell Guelph Hydro plus 11 delegates saying the same thing. The city spin does not quite describe it this way but as a vote against selling the utility as recommended by the Strategic Options Committee (SOC).

The more than four and a half hour meeting failed to discuss the Guelph Municipal Holding Inc, (GMHI), financial disaster that has left a $26,637,244 million loss in its five years of operation plus a stranded debt, a $65 loan from Ontario Hydro. It has been artfully morphed into an asset now parked on the city books, one that is “impaired” because GMHI is bankrupt and cannot even pay the interest.

In the city’s 2015 Financial Information Report this ”asset” was listed at $69 million.

Yet GMHI was not discussed during the meeting that was called by council representing the shareholders of GMHI, that’s us. The topic was on the city agenda for the Wednesday meeting but never brought up.

Checking with Bloomberg Financial Services, there are no executives listed. GMHI is defunct and as a wholly owned subsidiary of the Corporation of the City of Guelph. And on Wednesday, there was no discussion, of the status of this company by city council, aka GMHI shareholders. It was to be discussed at the February 16 special meeting of council according to the council meeting agenda.

GMHI is dead

Now we know why. GmHI was not discussed. It’s dead without identified officer of the corporation, no apparent surrender of its charter. Next question, where does the city-owned Guelph Junction Railroad fit into the new order?

The former mayor created the Municipal Energy Initiative (MEI), using the city-owned Guelph Hydro. Part of the plan was to create, through GMHI a $37.1 million District Energy system that combined electricity and co-generation to supply hot and cold water to nearby buildings.

The cost of this failed, massive project was not made public until May 16, 2016, following four years of operation and development, in closed session meetings of GMHI and city council. The secret GMHI plan included the construction of two, large natural gas-fired generating plants. One was to be built in the Hanlon Business Park and the other on city-owned property downtown. It is possible that the Hydro loan was to be used for these separate district energy plans.

It was the GMHI plan to make Guelph self-sufficient by creating its own power. What is this SOC bunch thinking are they trying to convince council and the public that we must endure another scheme to improve Guelph Hydro? The ramblings of the committee offering electrcity storage batteries in every basement are something out of Star Wars. It’s that spacey.

The citizens have just gone through a pricey, failed plan to turn Guelph into a community of self-sufficient power. Thanks, but no thanks.

The complicity of Guelph Hydro in this convoluted secret project is apparent and contributed to the soaring costs of electricity, up 45.5 per cent in four years, to its more than 55,000 customers.

Wearing two hats can be a recipe for disaster

Council and the city-owned Guelph Hydro, did not question the former mayor’s decision to amalgamate it with GMHI, of which she was chairperson before her defeat as mayor in 2014. That’s when the people decided enough was enough.

So why is this minority of council, led by a Mayor who wants to sell Guelph Hydro is the right thing to do?, paying another $500,000 to continue this examination of the future of Guelph Hydro?

While council, by an 8-5 margin, voted not to sell Guelph Hydro, it failed to even discuss GMHI, the MEI and District Energy system. Why is an independent committee composed of citizens with special interests and futurism, examining the operations and making recommendations?

Another odd element was the absence of CAO Derrick Thomson who is co- chair of the SOC composed of Pankaj Sardana, Hydro Board member Robert Bell (not Coun. Bob Bell) Richard Puccini and a former GHMI board member?

In the 2015 Financial Information Report, the city reported that there was an impaired asset outstanding of $69 million. The reason the amount had increased was because there was no money in GMHI to pay the interest. Presumably, there are no hard assets underlying this $69 million because GMHI is essentially bankrupt.

So the city takes on this debt, lists it on its books as an asset. Since the city has folded Guelph Hydro into its financial orbit, it’s only a matter of time before the “impaired” asset becomes a liability and will have to be written off,

Because of the operational secrecy employed by GMHI over the four years, there are still many questions that need answers. The ultimate hypocrisy employed by GMHI was sending a so-called $1.5 million dividend to the city each year to justify its existence. It was just a return of our money while GMHI in its entire history never made a dime. That’s a “Ponzi scheme” in which shareholders are repaid with their own money that is, paying through your hydro and water bills.

Writing off $96 milliom has cost every citizen

I don’t know how you feel about this, but the prospect of writing off some $96 million is one of the main reasons that the administration has no money for needed capital projects such as a new Downtown Library, Wilson Street Parking garage, and the South End Recreation Centre.

Another odd element was the recommendation of Mayor Cam Guthrie urging council to vote to sell Guelph Hydro. Councillors Mark MacKinnon, Karl Wettstein, Phil Allt and June Hofland joined him.

Two councillors, Karl Wettstein and June Hofland had a lot of nerve even participating in the Hydro vote. For four years, they were GMHI board members who were paid to serve on the board and never questioned or revealed the growing financial disaster of GMHI. Is this not an abuse of the public purse?

With MacKinnon and Wettstein, both representing Ward 6, they were salivating with the belief that the sale of Hydro would lead to building the $60 million South End recreation centre. Phil Allt’s said he was firmly opposed to selling Guelph Hydro but wanted more options. So why did he vote for the sale? Along with the Mayor who also said he was in favour of having the committee come up with more options.

The SOC has spent $100,000 since it inception Last September and is now projecting spending another $500,000 to complete phase two and report to council mid-year. So the $600,000 cost of all this jerking the public around will change the minds of those who voted against selling the utility?

It only points to the sheer desperation that the city administration is facing due to the GMHI financial disaster. Selling off Guelph Hydro is not an option to fix the mistakes of the past.

There was still no reference to the defunct GMHI situation.

But Panaj Sardana warned that the various merger options were not a slam-dunk. He said that on the negative side of the merger option, “Lots of mergers fail.”

“You’re talking about bringing cultures together and that has a huge impact on people, on companies, and you could have a very real culture clash,” he said. “If you don’t get this right, then you have challenges down the road.”

And the Mayor and certain members of council believe that investing another $500,000 will change things?

And how does a five-man (gender imbalance) committee justify spending $500,000 in the next four or five months?

Could it be that certain former officials of the city are complicit in corruptive practices and this failure to investigate the GMHI financial disaster is part of the cover-up?

Thanks to all you folks who influenced this Hydo NO Sale vote. As citizens we do have power the trick is how and when to use it.

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Tonight, it’s time to tell the truth about the failure of GMHI and Guelph Hydro

By Gerry Barker

February 15, 2017

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Tonight’s meeting, starting at 6 p.m. at city hall, will be a challenge for council and the administration to tell the truth about the huge losses encountered by the Guelph Municipal Holdings Inc. (GMHI) and Guelph Hydro. And include future liabilities to the taxpayers.

It’s time for the administration to level with the people and tell them specifics about the multi-million losses that the Community Energy Initiatives cobbled together by the former mayor. Her agenda was to make Guelph a world-class leader in energy efficiency and its environmental bedfellow.

Here’s what we do know.

On May 16, GMHI CEO and CFO Pankaj Sardana, along with former CAO Ann Pappert revealed that GMHI had accumulated losses of $26,637,244 million. Both officials signed the report tendered to city council. Ms. Pappert resigned 10 days later.

On January 12, it was revealed that the former mayor had even bigger plans. GMHI secured two parcels of land in order to build two Natural Gas-fired generation plants, one in the Hanlon Park and the other downtown. The cost of these plants and the two parcels of land needed to build them have not been disclosed.

Here are the write-offs. The capital cost of the Hanlon District Energy Node of $5.1 million will be written off. With only two customers, it loses a reported $55,000 every year. The Sleeman Centre Node cost was $6.1 million with $3.6 million being written down. The Sleeman Node makes some $127,000 a year.

Next, we are not told the cost of the underground thermal energy system connected to two Tricar condominium buildings, the RiverRun Theatres and the Sleeman Centre. Instead, we are told that the thermal system, powered by the Sleeman Centre District Energy Node will continue to supply hot and cold water for heating and cooling. Again, there are no details of the cost to citizens. What does that commitment accomplish in perpetuating GMHI, at the public expense?

At this point, we should be told of the total and ongoing cost of these misguided projects now and in the future

Here’s what we don’t know.

Because of the operational secrecy employed by GMHI over four years, there are still many questions that need answers. The ultimate hypocrisy employed by GMHI was sending a so-called $1.5 million dividend to the city each year to justify its existence. It was just a return of our money while GMHI in its entire history never made a dime.

In polite circles, that would be described as a “Ponzi” scheme. Paying off the city or the city-owned Guelph Hydro with its own money.

Because the former mayor and chair of GMHI, did not allow public participation in her management of GMHI, we have been handed one of the most serious financial

operating deficits in the city’s history.

Then there is that $65 million borrowed from Guelph Hydro by GMHI. In his May report, Mr. Sardana admitted that neither GMHI nor Envida Community Energy, a subsidiary of Guelph Hydro, had any financial resources to even pay the interest on that loan.

In the 2015 Financial Information Report, the city reported that there was an “impaired” asset outstanding of $69 million. The reason the amount had increased was because there was no money in GMHI to pay the interest. Simply, there are no hard assets underlying this $69 million loan because GMHI is essentially bankrupt.

So, the city takes on this debt and lists it on its books as an asset. As the city has folded Guelph Hydro into its financial orbit, it’s only a matter of time before the “impaired” asset becomes a liability and will have to be written off by fitire councils.

The questions remain, where did the money go? Was it spent? Is it a legitimate asset of the city? Is it no longer on the Hydro books?

Is it possible that the city financial managers have conjured a plan to keep the loan off the hydro books because the council committee is preparing us for the sale/merger of our electric distribution system?

The temptation of getting its hands on the proceeds of a sale on Guelph Hydro that could reap more than $150 million to solve all its wasteful spending problems and mismanagement of our affairs.

We are not the lost tribes of Carden Street. We are all the citizens impacted by this impending bad decision.

Make no mistake. This plan is in a full court press to selloff the jewel of our city assets to right the wrongs of the past.

My advice? Only the people can stop it by pressuring the council by email, telephone, Twitter and Facebook to say no and demand the truth of what has happened to our city.

If you turn up tonight at 6 p.m. in force, council will listen.

If council fails to listen to the people, then they are all in peril in October 2018 of being re-elected.

That I can guarantee.

I know there are some coucillors who understand the ramifications of tonight’s decisions. But the majority of progressives can be defeated by the people.

I don’t know about you, but this is a no-brainer. Stop, tell the truth and lets start the process of returning Guelph to fiscal responsibility and meet those targets that almost all people want that are bring denied.

You know what to do.

 

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Citizens will hear the future of Guelph Municipal Holdings Inc. & Guelph Hydro Wednesday night

By Gerry Barker

February 13, 2017

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Important note: The sale or merger of Guelph Hydro is scheduled for Wednesday night February 15, commencing at 6. p.m.  The fate of GMHI will also be discussed the same night. Sorry for the inconvenience. My advice still stands, please plan to attend the Wednesday meeting and make your voices heard. GB

On Wednesday, expect a different tactic employed regarding disposal of Gyelph Hydro.. A five-person committee, headed by CAO Derrick Thomson, is asking council to approve the sale of Guelph Hydro with the committee having the power to do so.

This time the method is different from 2008 when then Mayor Karen Farbridge was defeated in attempting to have council approve the merger with two other local distribution facilities in Hamilton and St. Catharines.

This is nothing but an end run to capture capital gain from the sale or merger, take your pick but someone is going to pay for it,

How can this committee, that has one member of council on it, Bob Bell, be given the power to dispose of the city’s most valuable, profit making asset?

How can the committee gain such power when the future of the Guelph Municipal Holdings Inc. misadventure into a $96 million disaster, hangs over the city like a vulture setting up his evening meal.

Ask yourself, where does the city, the one without a Chief Financial Officer for more than two years, plan to use this potential cash bonanza? Reduce the debt? Pay-off the $65 million hydro loan now sitting on the city books as an impaired asset. That’s because the borrower, GMHI, chaired by former mayor Farbridge, has no money to even pay the interest of the Hydro loan.

Apparently, the Wednesday agenda will discuss extending the future of GMHI to be targeted until mid year.

Are the potential Hydro sale/merger proceeds going toward the police HQ renovations? Or a new downtown Library? Or the South End recreation centre? Those items total capital spending of $140 million.

Is this prudent management of city assets? We live in a city that has higher operating and capital spending budgets than Cambridge and Kitchener, some 50 per cent higher. The disappearance of senior managers since 2014 has made matters worse. Our taxes are among the highest out of 445 municipalities in the Province.

Even more interesting, the Thomson committee debated for five months. They asked for public input and the response was overwhelming against the sale/merger of Guelph Hydro.

The committee also gave citizens little time to appear before council to comment on the committee recommendation to allow it to sell or merge Guelph Hydro. Is this fair?

This is nothing but a gigantic sham to shut down public protest and grab the value of Guelph Hydro estimated to be $150 million.

* If you want someone else to control your electricity costs, don’t show up Wednesday night.

* If you believe what this Thomson committee was told by outside consultants about the declining value of Guelph Hydro and the future of turning your home into a storage site costing thousands of dollars, then don’t show up Wednesday night.

* If you believe that your water bills are going to be reduced if Guelph Hydro is sold, don’t show up Wednesday night.

* If you believe that the proceeds gained by selling off Guelph Hydro will lower your taxes, don’t show up Wednesday night

* If you have faith that council will table the committee recommendation, don’t show up Wednesday night.

It’s time to call a halt to the sloppy and inefficient management that has been denuded of talent. Instead, it lurches on without reducing the city’s gargantuan spending policies that always are directed at the wrong goals at the expense of the necessary goals.

This is the citizen’s opportunity to protest this recommendation that lacks the credibility of public power.

If council passes the recommendation, say goodbye to public trust, power and the city’s most valuable asset.

Addendum

In my opinion, Councillors Karl Wettstein and June Hofland should not participate in discussions regarding Guelph Municipal Holdings Inc or the proposed sale/merger of Guelph Hydro. Their role of serving on the GMHI board of directors for four years and participating in the $96 million dollar losses, linked to Guelph Hydro, of that city-owned corporation, creates a conflict of interest.

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City dismisses a key senior employee for release of confidential information

By Gerry Barker

February 10 2017

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Today marked the end of the Farbridge administrative regime existing for the last ten years. Chief Administration officer (CAO), Derrick Thomson announced that Deputy Chief Administrative Officer (DCAO), Mark Amorosi, was no longer employed by the city.

Reaction was swift as the Internet lit up with comments from citizens supporting the departure.

As the editor of guelphspeaks.ca, involved in a lawsuit commenced by Mr. Amorosi, at this time, I will have no comment until the details of the dismissal become more relevant to the case.

While the CAO applauded the “valuable contributions that Mr. Amorosi contributed to the City of Guelph, there were many underlying concerns about the operations of the city by a DCAO who oversaw, Finance, Human Resources, Information Technology, Special Project Management and Court Services.

That responsibility was the largest senior management responsibility of any of the three DCAO’s. They reported to CAO Derrick Thomson who announced the departure of Amorosi.

Enter the $1 million lawsuit by former Chief Building Inspector Bruce Poole, against the city for wrongful dismissal. His lawyer, during the examination for discovery, asked the city for emails concerning Mr. Poole’s firing. Instead the city downloaded the files from the server and hundreds of alleged confidential, unrelated emails were included. Most initiated by former Chief Administrative Officer, Al Horsman.

But here’s the problem. While Amorosi was responsible for the Information Technology department, headed by former city clerk, Blair Labelle, the drive sent to Bruce Poole’s lawyer contained a ton of alleged confidential information. It was an external thumbnail drive reported to contain 53,000 emails included in the information that was requested by Mr. Poole’s lawyer.

Tony Saxon, reporting in the online Guelph Today, published some details of the thumnail drive in a report last Friday morning. The public reaction was instant. By the afternoon CAO Thomson, apologized and requested the return of the offending drive.

But here is where the plot thickens. Five days later, the city fired Mr. Amorosi.

This is a veteran senior manager who had enormous responsibility for eight years.

In my opinion, this firing statement published by the city, did not trigger the dismissal. It was something else that created the immediate firing of a senior manager making $216,000 a year.

It may never be revealed what the real reason was because of the secretive manner in which the public is denied specifics of the how our city is managed. Or why voters rejected in 2008 the sale of Guelph Hydro. Yet the administration is now seriously considering selling or merging Guelph Hydro…the same thing.

Digging into it, the committee charged with examining the options of the future of Guelph Hydro, has heard from a consultant that today’s Hydro Electric Distribution (LDC) systems are outdated and losing value.

Why? Because more and more local power distribution systems are being overtaken by technology. He cited that people would have batteries in their basement to store unused power generated by rooftop power generated solar panels.

To interpret, he is saying that a homeowner will have to invest thousands to install the solar panels, then the storage batteries and the necessary control equipment.

When Tesla, the electric car company operated by Elon Musk, builds the world’s largest battery manufacturing facility, and along with dozens of other companies, they have been working to develop high-capacity batteries for cars.

To suggest that there is technology today that is reasonably priced is misguided and a disservice to citizens. Think about it. We have a perfectly working electric distribution system that derives power from a well-established source.

Why would citizens in Guelph agree to sell a perfectly well operating electric supply system, based on this specious information promising something that is non existent today? Why would they agree to lose control of their Hydro distribution system to be exposed to new charges from a new owner for a service they need?

I contend, that our Guelph Hydro system is doing the job intended since it has going back to Adam Beck and the Niagara Hydro generating systems.

Haven’t the citizens being exposed enough by the errant Guelph Municipal Holdings Inc? It has been an adventure imposing a District Community Energy system to almost bankrupt the city, losing some $96 million?

The case is clear. Our administrative overhead costs are way out of line. We can survive if the council realizes what is the only course of action to save the city financial problems.

Selling Guelph Hydro is a band aid. Managing our overhead, as outlined by Pat Fung, CA, CPA in his detailed analysis of city financial management, is the responsible way to reduce our costs and dependence on ever-increasing property taxes.

Today may be the first day to begin the recovery of common sense and reform of an administration that is ill. Is it ready to correct the mistakes of the past without selling a premier asset?

As a final note, I have disagreed with some of the decisions of Mayor Cam Guthrie in the past two years. But I must say, that he is on the brink of cleaning up the financial mess he inherited.

Drive on.

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Another reason why our city administration is dysfunctional and won’t listen to the people

By Gerry Barker

February 9,3017

It was bound to happen sooner or later. This week, our intrepid Councillor James Gordon, representing Ward Two, has wandered off the page to promote another issue on non-civic importance.

You see James was elected to represent the people in his ward not ask council to approve issues over which he nor council have any jurisdiction or interest.

Last summer he protested about the amount of water Nestle was legally removing from the same huge underground aquifer that supplies the city of Guelph with its water.

Council spent time and political capital to ask the province to step in and stop a commercial company from, dare I say it, draining the aquifer. His crusade caught the eye of Premier Wynne who pledged a full scale investigation about private enterprise pumping water from underground supplies that municipalities depend on for public water.

Let’s talk about Guelph and its use of aquifer potable water in which Coun. Gordon has raised a red flag. His concerns are an exercise in pure politics that mesh with his views and concerns about climate change, the environment and now, about how we should treat refugees/

The actual figures of water use in a city of 121,000 are buried somewhere in the files if the water department and usage is seasonal. As estimated, lets try to calculate the amount of water taken every day for 24 hours that the Guelph wells are pumped to meet the demands of 55,000 households and businesses.

The variables are complicated. Much of the housing built in the past 30 years come with at least two toilets, four sinks, two bathtubs with showers, two outside water hose connections, ice making refrigerators, hot water tanks and laundry units to wash clothes. Commercial water demands vary depending on the size of the enterprise.

Have to go with averages here, as our experience does not fit the average.

Multiplying 55,000 times an average of 100 litres per household per day, not including seasonal or commercial use, that comes to 5,500,000 litres a day seven days a week, 365 days a year. And as the city expands, demand for more water increases.

Now, how much is Nestle drawing from the aquifer to fill its bottled water inventory?

Statistically, it’s a drop in the bucket compared to how much water Guelph is removing daily from the massive subterranean aquifer.

Moving on this week, Coun. Gordon asked council to name Guelph as a “Sanctuary city” for refugees to settle safely with local support. This description has come out of California where the state capital, Sacramento, has been identified as a Sanctuary city for mostly Mexican illegals by the Trump administration.

Gordon’s move attempts to capitalize on a U.S. political situation regarding immigration and a ban on Muslims arriving from seven identified countries.

Canada is already a proven sanctuary for more than 40,000, mostly Syrian refugees admitted in just over a year. The U.S. in the same period admitted less than 4,000.

What strange political bedfellows. President Donald Trump and Guelph Councillor James Gordon. Trump determined to stop immigration and Gordon trying to encourage it,

Heck, Canada is a country of Sanctuary for refugees. You don’t have to go too far back in our history when Canada accepted some 68,000 Vietnamese boat people escaping the communist takeover of their country. The same occurred with the arrival on shores of the Sri Lankan refugees who escaped the terroristic tactics of the Tamil Tigers.

Mr. Gordon should reflect on our history of Canada’s massive refugees, programs since 1945 when we welcomed thousands of European refugees called Displaced Persons (DP’s). But to our great benefit were the thousands of Italian immigrants who chose Canada as their new home.

Those newcomers’ skills, energy and work ethic are reflected as Canada’s charter membership in the G7 group of World Economic powers.

Yet, here is our councillor using political opportunity to create a problem that is being conducted professionally by the Federal Government. Isn’t he mimicking the Trump administration tactic of creating a problem usimg an Executive Order to create a solution?

All I ask Mr. Gordon to do is start working as a councillor and not to obtain the NDP nomination for the upcoming Provincial election next June.

Your performance as a councillor is highlighted by voting for a widening of Speed vale Avenue from Woolwich to Manhattan Circle. You voted to spend $14 million to move the power lines, widen the street to allow bicycle lanes and reduce the vehicular lanes from four to two with a centre left-hand lane.

The staff did not recommend this. Mr. Gordon received more than 150 e-mails protesting the proposal, yet he voted for it.

The day he has the city pick up our sorted garbage, that the city refuses to do, then we will reassess his responsibility to the residents he represents.

His lack of concern about his electors should send a strong message that he should not run in 2018 because his idealism is getting in the way of reality.

After all, shooting the breeze regularly in a downtown restaurant does not equivocate your responsibility to all Guelph citizens.

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Expose! A trilogy of events by a city administration out of control

By Gerry Barker

February 6, 2017

Note from the Editor: This column is in two parts that covers and comments on recent events that reveal the toxic culture existing in our city administration. What you will learn in Part One, titled Triology, is how three events learned last week, have exposed the underlying weakneses of a management that is out of control.

In Part Two, titled Expose, are the details of some 53,000 emails sent chiefly by former Chief Financial Officer, Al Horsman, revealing the secretive and personal misuse of the city servers by senior staff.

We encourage everyone to pass this column along to let as many people as possible learn the truth about secrecy, closed meetings and communications on the Internet city staff and council. And it has been going on for years behind the public’s back and is our right to know.

There were three events this past week that revealed how our city is being mismanaged by not only senior staff but by an element of city council.

Part One – Trilogy

BREAKING NEWS

CAO Derrick Thomson said Friday, February 3, that the 53,000 emails obtained by Bruce Poole’s counsel were sent in error. Apparently an external drive containing the emails was handed over to Poole’s counsel. When the story broke about the contents Friday morning, the city administration went into panic drill and requested the drive be returned. So far that has not happened. The CAO said if it is not returned the city will ask for a judge’s order to return it.

Sorry sir, that fox is out of the hen house.

The larger question is who handed the drive containing the 53,000 emails over to the Poole Counsel knowing what was in it? More on this in Part Two – Expose.

Here is the list of the three devastating revelations of how our city is being so poorly representative of the people’s rights, interests and concerns.

* We start with the announcement that city Solicitor, Donna Jaques, was leaving this week. She had been with the city since 2011 in charge of all legal matters including contracts, bylaws and litigation.

This development was followed after with 53,000 emails produced mostly by former Chief Financial Officer, Al Horsman. Former Chief Building Inspector Bruce Poole’s lawyer obtained the emails as part of his examination for discovery. You will recall Mr. Poole, a 30-year veteran in the building department, was fired in mid-2015 and sued the city for $1 million for wrongful dismissal. That lawsuit has still to be tried or settled in court.

As a public service, here is the list of witnesses if this case goes to trial: Former CAO Ann Pappert; former City Solicitor, Donna Jaques; former General Manager of Finances and Treasurer, Janice Sheehy; former CFO Al Horsman; current CAO Derrick Thomson; former Executive Director, Derek McCaughan; City Clerk, Stephen O’Brien; and General Manager of Human Resources, David Godwaldt.

Perhaps this is a good time to tell you about a city Bylaw known as the Indemnification Bylaw. This protects any staffer or elected official from being sued by any citizen. If they are, the staff’s legal costs will be paid by the taxpayers. It was signed by former CAO Ann Pappert and Mayor Cam Guthrie in 2015 following the Susan Watson case against Glen Tolhurst regarding receiving a $400 donation from GrassRoots Guelph (GRG). Both Mr. Tolhurst and GRG were cleared of any wrong doing by an independent auditor.

* Then came the report of a committee charged with examining the future of Guelph Hydro. Their findings were essentially flawed and biased. They commenced deliberations last fall and despite overwhelming public comments to not sell or merge the utility, they are seeking permission to sell or merge with another municipally owned Local Distribution Company (LDC).

The report states: “At this stage in the process, a large segment of those who commented want to maintain local control and public ownership, and there is low-level support for a sale, especially with a privately-owned utility.”

“The public engagement done so far also shows “no support for Guelph Hydro to buy other utilities,” the report says. And “if a merger is considered, participants prefer other utilities in the region and those who are ‘like-minded’ with Guelph Hydro.”

This is Important: So why is the committee, after five months of deliberations, recommending that the city dispose of Guelph Hydro? Their recommendation will be voted on at the February15 council meeting. If you want to address council on this matter, your have until February 10 to register, four days from now.

Let’s stop and think about these three developments and how they are linked and not necessarily in favour of the citizens. In my opinion, these developments are part of a conspiracy to misdirect, suppress, and deny the public their right to access this information.

* Ms. Jaques’s departure was not sudden despite appearances. It would take at least three to four months to search and get another job. But she had to know of the existence of those 53,000 emails and most likely was directly involved in the turnover during the examination for discovery in the Poole lawsuit case. She had to know how damaging those emails are when the reputation of her colleague’s ethics and credibility are at stake.

The remaining question is how many thousands of emails were exchanged between senior staff and still out there? Discovering the emails sent by the former CAO, Ann Pappert, would be useful to investigators by an independent audit of city operations

Chalk it up to the way the staff runs the city. They used what they believed were private confidential emails to chatter, gossip and express opinions about fellow staffers. Heck, even look for a job, with our employer in the dark. Manage your personal finances and discuss marital and health matters with other staffers. The sheer volume of those emails, averaging 125 emails sent every day Mr. Horsman was on the job. (He wrote 53,000 emails over a two-year period divided by 422 actual working days over two years).

I don’t know about you, but that’s a ton of emails, most of which concerned the fundamental operation of the city. This info was coming from the CFO, the person who handled the money.

As an aside, Mr. Horsman was the last CFO employed by the city in the past two years and two months. He lost his position in November 2014 and left the city in August 2015 to take over as CAO of Sault Ste Marie.

The evidence now persists that nothing has changed. The city administration operates chiefly in secret. They do it to prevent exposure of self-serving issues reaching the public domain. The proliferation of emails is an indicator of the manipulative strategies employed by both senior management and members of council.

It may explain why so many senior managers have left the city since the October 2014 civic election. Most of those leaving have left a legacy of mismanagement and problems caused by the policies adopted by three administrations. The situation was aided and abetted by inaccurate forecasting of budgets, lawsuits, and off the books major funding of the failed Community Energy Initiative that was controlled by the former mayor.

Here’re some of the former senior managers who have left the city since November 2014: Executive Director Janet Laird; Executive Director, Derek McCaughan; CFO Al Horsman; GM of solid waste management, Dean Wyman; Lawyer Scott Worsfold; GM of Finance and Treasurer, Janice Sheehy; CAO Ann Pappert; City Solicitor Donna Jaques; Acting GM of Finance, Susan Arum; Chief Building Inspector, Bruce Poole.

The tab, so far, is estimated to be more than $96 million misspent by the former Mayor’s Community Energy Initiatives.

This bring us to the proposed recommendation by a five member committee chaired by CAO Derrick Thomson, to dispose of the jewel of the city of Guelph, our hydro electric distribution system.

It is a desperate move to conduct an asset fire sale to cover up the Guelph Municipal Holdings Inc. losses of $96 million and counting.

The book value of Guelph Hydro is estimated to be $150 million. Its value is increasing because there is a great demand to get control of these LDC’s. Hydro One gobbled up more than 89 between 1996 and 2001. You will recall that Hydro One is being gradually sold off to private enterprise. Today there are only 70 remaining LDC’s in the province. You can appreciate the primal urge by the administration to liquidate this asset because they need the money.

I urge everyone to make their feelings heard with their councillors by telephone, emails, snail mail or personal contact to stop this recommendation February 15. Just showing up will help prevent this ill-advised effort to sell off Guelph Hydro.

Personally, I believe the motion, if made, to dispose of the utility should be amended to table the recommendation to allow more measured public input, not just seven business days.

In 2008, former mayor Farbridge attempted to convince council to sell Guelph Hydro because the city did not have sufficient capital to pay its $23 million share of the Federal-Provincial infrastructure grant plan. She was soundly rebuffed by an 8-5 vote. Then she called a $30 million note that Guelph Hydro owed the city to pay the infrastructure bill that grew to $27 million, due to add-ons including bike lanes and a time clock in the Sleeman Centre.

It now appears nothing has changed.

On or before February 15, please exercise your right to object and inform civic leaders of your opinion. We only get one chance to stop this and now is that time.

So, if council does approve selling or merging of Guelph Hydro, what are the alternatives?

Assuming the city receives an estimated $150 million for Guelph Hydro, citizens lose control of the operation, including what they pay for service as set by the new owners.

The proceeds will pay for the GMHI losses. The new owner could claim the $65 million stranded Guelph Hydro loan to GMHI. It currently is on the city books as an impaired asset, is due and payable. That could reduce the net proceeds. Do not be surprised if that loan is not on Guelph Hydro’s books.

The proceeds, I predict, will disappear before the civic election rolls around next year. Suddenly there are funds to build the South End recreation centre, the Wilson Street parking garage and perhaps the Downtown Library.

This will be a bonanza of political good will that could guarantee the re-election of the same council majority we have now.

It’s our choice and it happens next week.

Next: The Bruce Poole story and how it will change Guelph forever.

The day the administration was exposed as running a ship of fools

By Gerry Barker

February 6, 2017

Part Two – Expose

Let’s start by praising Bruce Poole for having the guts to go after the city he served so well and loved for 30 years. They did him dirt by firing him for challenging the administration for failing to follow its own bylaws regarding obtaining building permits for ALL such projects in the city.

The revelation that there were 50 such projects, all conducted by the city administration in which no building permits were requested for approval. It became the genesis of the former Chief Building Inspector’s $1 million lawsuit for wrongful dismissal.

Then, last Friday a report in Guelph Today, written by Tony Saxon, detailed how that, during the examination for discovery, some 53,000 confidential emails, authored by former Chief Financial Officer, Al Horsman, were turned over to Mr. Poole’s lawyer.

A cursory examination of the email-gate reveals a fascinating collection of critical personal opinions, paranoia. petulance and what senior staff thought about their colleagues.

These include performance reviews of city employees; details of legal matters discussed in camera; criticism of city staff members; details of acute city operations; and even discussions about personal marital and health issues.

It’s a sorry cultural soup reflecting how messed up and irresponsible the members of the senior staff and others, including certain members of council.

The bottom line is, these emails, many marked confidential, were sent through City of Guelph servers. This makes those 53,000 documents that the users believed would never be made public, now part of the public record.

Kudo’s go to Bruce Poole’s legal counsel for obtaining these emails from the city ensuring the public’s right to know.

Across Ontario can you hear the shredders humming and emails being deleted?

(Suggest it would be better to use an expert for that process).

The source of these emails came from the former Chief Financial Officer of Guelph, Al Horsman. He left the city in August 2015 to become Chief Administrative Officer of Sault Ste Marie.

Email-Gate shows he used the city’s Internet servers to apply for another job. It even included preparing a power point presentation to the Sault’s selection committee. Using Guelph’s resources, Horsman landed his new job.

It makes one wonder how senior employees across the province are properly vetted when seeking new jobs. Is the process flawed? Are questions not asked? Why is the person leaving? Are references requested?

This applies to our former Chief Administrative Officer, Ann Pappert who left the city to be appointed an Assistant Deputy Minister of Culture, Tourism and Sport for the province.

Let’s review her leaving May 26, 2016. She was awarded an increase of $37,501 in a closed meeting December 10, 2015. So the question is, why did she leave a $257,501 job for one that probably pays much less?

She should be Bruce Poole’s most important witness as his case proceeds. The evidence is pointing to her as the fox among the chickens. In case you are wondering who are the chickens? They are us! These bureaucrats have suborned their responsibilities to the people by communicating by emails and conducting the public business in closed sessions.

I am astonished about the volume of Al Horseman’s emails for the two years he was a senior member of the administration totaled 53,000. The man is on the job 211 days a year reduced by weekends, vacation, statutory holidays and city shutdown periods

Just doing the math, Mr. Horsman wrote 125 emails a day. Further, that’s an average of 15.6 every hour for his eight-hour workday.

But it should come as no surprise because this is the way our city managers have operated, far from the public view or access for the past ten years.

Here are some examples of the email content delivered to Mr. Poole and his lawyer:

  • 30 individual staff performance reviews
  • Who were these employees and who conducted the reviews?
  • A calendar entry titled “Linamar – foregoing and/or deferring property taxes or development charges on future Linamar properties.

            It would appear that Linamar is getting a tax break on its property taxes. What are the details?

  • Confidential and private information in regard to the Urbacon action and settlement details” “Confidential and private information in regard to the Dolime legal action and settlement details.
  • What did Mr. Horsman know about the Urbacon situation and what was his role in the settlement?
  • Confidential emails between Horsman and his bank regarding personal investments.
  • Not a good idea to use your business computer for such private information or to seek another job.
  •  
  • Confidential email exchange between Horsman and CAO Anne Pappert regarding concerns about the performance of a senior city manager still with the city.

Well now, we are getting to the meat of the email exchange. Who is this senior manager and his/her job responsibilities? Did that person receive an increase in remuneration in 2015?

  • Confidential email exchange between senior management staff members in regard to “Terraview complaint re: Development charges @ 72 York Road.

Isn’t this public information? Where are the details? We have 13 employees in the  city engaged in communications. Why weren’t the details reported?

  • Several “corporate communications watch list” reports, including one item listed as “investigation of bacteria incident at City Well (Membro) – information protected under client-solicitor privilege.
  • And the people were never told?”

Nothing today in a public corporation is confidential. The exceptions are in the provisions as outlined in the Ontario Municipal Act to conduct closed sessions. With this revelation, it is apparent that cyber communication between senior staff often bypasses the OMA closed session regulations.

  • “Numerous occurrences where Al Horsman was using the City of Guelph’s computer system to seek and respond to several new and alternative job opportunities.”

Earning $182,000 a year does not include using your city computer to get another  job.

  • Negative comments (via email) about Mayor Cam Guthrie from a current member of council that was shared with others

No! Say it isn’t true. The Mayor thought all you senior staffers and council were  his friends.

  • Several emails detailing confidential terms of settlements in several legal matters.

This is not good but as CFO he was within his right. Legal cases are touchy and  the former mayor became known for her litigious bent. Now the city solicitor has left for greener opportunities in North Bay. Her leaving coincides with the  revelation of the 53,000 emails.

  • Confidential email exchanges between senior staff members in regard to concerns about a senior city manager who is still with the city.

            Yikes, if the senior staff had reservations, why is this person still with the city?

  • Private and personal emails between Horsman and other executive staff members in regard to personal matters such as marriage and health. 

Was this on city time?

  • Copies of confidential information shared by Horsman with former city staff.

This smacks of the existence of an elitis city staff club. Why would Horsman seek  conversation with former staffers?

  • “Confidential email exchange between Corporate Finance staff and senior management staff in regard to DGBA (financial concerns with the Downtown Guelph Board Association).”

It must be noted again that emails on the city servers are not confidential, as many have been titled. They are in the public domain.

There is indication that people are enquiring about obtaining the details of all those emails through the Freedom of Information Act (FIA).

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Running a city is easy, just don’t tell the citizens what’s going on

By Gerry Barker

January 30, 2017

We live in a liquid society in which change is constant, unsuspected and starkly inconsistent.

In the past ten years, our city has experienced this. A minority of citizens and their elected representatives has dominated our lives with their visions imposing change in which the vast majority of citizens do not agree.

People are always on the move; they sell and leave, people move here to obtain cheaper housing only to discover their costs are too high. People die, babies are born and businesses come and go. It’s a fluid condition that is constant.

Briefly, here are some of those policies that have failed not only operationally, but with multi-million dollar losses of public funding. The Community Energy Initiative (CEI) is currently holding the record for wasted time and resources. So far, losses by Guelph Municipal Holding Inc. (GMHI), total more than $26 million and is still increasing daily. It was founded and chaired by former mayor Karen Farbridge who created GMHI under the guise of managing city-owned properties including Guelph Hydro.

Keep in mind the taxpayers of Guelph are still responsible for GMHI’s finances.

Let’s just stop there for a moment. Guelph Hydro has an estimated book value of $170 million. Its monthly cash flow from more than 55,000 customers is estimated to be more that $13 million. Of that, Hydro must pay for the power it distributes, staff and overhead.

A few years ago, the former mayor, a member of the Guelph Hydro board of directors, attempted to convince council to merge with Hamilton and St. Catharnies distribution systems. It was one decision her council did not support.

Now Hydro is asking citizens to indicate preferences for selling or keeping the utility. It could be a prelude to selling the utility and using the money to bolster city finances. Wonder if GMHI is transferring that $1.5 million annual dividend to the city’s coffers?

The GMHI effect on city finances looks like, and smells like a gigantic Ponzi scheme in which the shareholders, that’s you and me, are repaid with our own money.

As chair of GMHI and a member of the Hydro board, Ms. Farbridge, with the support of four members of her council serving on the board, transferred the assets of Guelph Hydro to GMHI. Over four years it paid the city $9 million in “dividends.”

It is important to note that the Guelph Hydro Board does not hold public meetings. So the details of transferring Guelph Hydro are not known.

Then Guelph Hydro loaned $65 million to GMHI. When asked, CEO Pankaj Sardana said the money came from investors and did not identify Guelph Hydro or Guelph Hydro Electric Services subsidiary as the contributor. In 2015, that loan appeared on the city’s Financial Information Report as an “impaired asset” valued at $69 million.

Mr. Sardana and former CAO Ann Pappert reported to council May16, 2016 that GMHI

had no financial ability to even pay the interest on the loan. This is a liability, not an asset. It will never be repaid to Guelph Hydro because of the GMHI financial collapse in 2015.

With both Ms. Farbridge and her CAO Ann Pappert gone, there are only two members remaining of the GMHI board who served for four years. Neither Coun. June Hofland or Coun. Karl Wettstein is talking about their participation.

Mr. Sardana said the business plan was flawed and stated that the CEI project, the two district energy nodes (pumps) built in the Sleeman Centre and the Hanlon Business Park, have failed to meet contracted targets and performance. Most of the $8.7 million cost of these pumps has been written off or down.

But no one on Council or the staff is talking about the $65 million loan to GMHI.

All this happened behind closed doors with no public participation or information.

Ms. Farbridge set up a system of conducting council business in closed session. She did the same thing chairing the GMHI board.

Today, little has changed. Mayor Cam Guthrie has a dilemma. He is trying to maintain his base that includes former Farbridge supporters. He talks about reducing overhead but turns around and votes to hire 13 additional employees and level a two per cent property tax levy described as replacing the infrastrcuture. Except half isgoing to “City Buildings.”

He could have said: No.

The evidence shows that her eight years in office was a disaster of the former mayor’s own making as she attempted to change the city regardless of what the people favoured or cared about. Millions were spent and misspent on her agenda.

But her councils were unable to build a new city hall without going over budget by $23 million; could not install public washrooms downtown to meet the needs of visitors and folks out for the evening. In 19 years, her council did not build a new downtown library but spent $5 million for three lots facing on Wyndham Street that are now used for parking cars.

Along comes the planned Wilson Street Parking garage in which there is a pedestrian bridge between the Garage and City Hall. Question? Is this for the use of the public or to serve the staff working in City Hall? And whatever happened to that Canada Revenue charge when the city was offering free parking to its employees but not charging it as a taxable benefit?

It’s time for a new deal

We must work to encourage independent candidates to run in every ward seat. People with common sense who can establish a fresh responsible direction for our city, have business experience and who understand a balance sheet.

They should run on cutting the operational overhead, shutting down those closed session meetings, emphasizing accountability and open government. Past management practices have contributed to the drain of our reserves to balance the books and pay for ten years of mistakes.

We need new ideas, new direction and appeal to the younger demographic who will inherit the future by dealing upfront with the mistakes of the past.

These closed session meetings have to stop. Only those authorized session meetings concerning employee relations (not salary negotiation), public contracts and labour union negotiations.

From personal experience, I asked the city clerk, November 7, to request that the city appointed closed session investigator to open council’s closed session meeting Dec. 10 2015. This was the meeting that approved the $98,202 increases to three top staff executives.

I’m still waiting.

 

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