Monthly Archives: October 2012

This train is really off the track

Posted  October 11, 2012

It is moderately amusing that Mayor Karen Farbridge persuaded electors in 2006 to support her with the slogan “putting Guelph back on track”.

Six years later, we have experienced a political train wreck like no other in the city’s history.

Engineer Farbridge has managed to create policies and spending that resemble a city going over the cliff.

Why?  The basic problem is the Mayor; members of her dominating majority in council don’t have a clue about financial management let alone basic economics.

They know how to spend your money but nary a clue about staying within a budget, controlling spending or recognizing how their spending is mortgaging the city for years to come.

One of the key problems is the high turnover of Chief Financial Officers – five in six years. The latest staffer, recently hired to do the job, has broad general civic experience but no formal education in accounting or financial management.

This turnover of financial managers has led to a crazy quilt management of city finances in which money is drawn from a specific account to pay for a shortfall in another unrelated account. It is compared to the average person skipping the telephone bill in order to pay the cable bill.

One of the most hazardous financial situations the city is facing is the number of lawsuits against it. It is understood the number exceeds 20 cases. These are potential liabilities that are not budgeted. One in particular is the $19 million suit by the contractor who built the new city hall. A mediation process failed to settle the matter so the risk to the city remains.

Another is the attempt by the city to separate itself from the Wellington –Dufferin –Guelph Public Health group. The city objected to paying its $10 million share of the cost of a new $17 million headquarters in Guelph. It sued to get out of the consortium and failed. The legal costs have never been revealed. The city now has to pay and the $10 million is unbudgeted.

Another problem is the secrecy surrounding the new composting plant’s contracts. The city, through its agent, Aim Environmental, has contracted to process 20,000 tonnes of wet Waste from Waterloo Region. The charge for this service is vague but is estimated to be in the $140 per tonne range. Trouble is after spending $34 million of taxpayers money to build the plant, the city refuses to reveal the operating costs. Informed estimates are in the $342 per tonne range. It is noted that Aim Environmental will operate the plant as well as sell the capacity to other municipalities.

Guelph taxpayers were never asked nor approved such a huge expenditure that has now escalated to more than $50 million.

Aim Environmental is a subsidiary of Maple Reinders, designer and contractor of the compost plan. It will operate the plant and seek additional tonnage to bring the plant up to full capacity of processing 60,000 tonnes annually. Guelph usage is 10,000 tonnes a year. The rest has to come from outside sources.

Why is the city building composting facilities to service other municipalities?

Why did the city agree to build a plant with taxpayer’s money that was six times the capacity of Guelph’s needs for the next 25 years?

What are the details of the Aim Environmental contract to manage and supply feedstock to the plant?

This has all the appearance of a terrible business deal where Guelph taxpayers take all the risk with little return on their investment.

The external auditor of the city’s finances does not consider any item less than $600,000. This is common practice with professional accounting and auditing firms. The cut off depends on the size of the account. In Guelph’s case, based on the 2011 budget, the number is $600,000.

This means that the accounts below the $600,000 threshold are not audited. Without responsible internal oversight and control there is a lot of leeway. This is possibly the reason that the city recently hired an internal auditor to review services and operational areas of city government.

Now we learn from the new internal auditor that city staff lacked the “expertise” to carry out the council mandate.  Council set aside $200,000 for the first phase to conduct the reviews of which $85,000 has already been spent.

Two areas, legal services and business systems operation, were reviewed with the help of outside consultants.

The council will be asked for additional funds in the 2013 budget so that the work may be completed.

So there you have it. To find out how the various staff-operated city operations function, $200,000 plus the auditor’s salary is spent with more to come. The auditor stated the extra funding is in part to obtain public input.

Do you really believe the people will be told how their taxpayer-funded operations function, good or bad?

That’s like Stephan Harper telling the public about the real costs of the new F-35 jet fighter his government wants to buy.

If you buy that, they will come.

 

3 Comments

Filed under Between the Lines

Political dogma has erased reason in Guelph

Posted October 9, 2012

A recent op-ed column by Allan Gregg, one of Canada’s most respected pollsters and student of the human condition, outlines how political dogma has eclipsed reason in many jurisdictions. They range from the federal and provincial governments to cities and towns.

What is political dogma?

As Gregg pointed out: Governments are ceasing to use evidence, facts and science as a basis to guide policy. Instead, are retreating to dogma, fear and partisan advantage to control their chosen agenda.

He further stated: “The handmaidens of evidence-absent dogma are almost always secrecy, obfuscation and misdirection.”

The message is tarted up in “newspeak” that has become the controlled language of legislators.

It isn’t what you need to hear, but what they want you to know.

The strange part is that the substance of government action is disguised in a veil of managed “newspeak”. Why is this necessary? Would telling the truth be effectual?  By obfuscating the true purpose of legislation there is tacit admission that the intention probably lacks public support and respect.

As Gregg opines, this explains why government’s obsession with secrecy and control of the message lies through misdirection.

Closer to home, we see these exact examples of the political dogma practised by the Mayor Farbridge council majority, dominating city government for the past six years.

You can start be seeing the absence of reason in many decisions. The Guelph public is locked out of the details of many of these decisions despite the claim of the Mayor that council actions are transparent. They are not.

They believe their version of ‘Newspeak” fulfills their obligation to the citizens.

Here are a few of the examples of how council has failed to reveal the facts of major spending.

*   The decision to move the civic museum to the derelict Loretto Convent was the result of council’s agreement with the Guelph Historical Group to save the convent.  The exercise has been a financial disaster and was taken without public input. The real cost of the museum has been smothered by the administration. They were embarrassed to admit the cost of renovation that took almost five years to complete.

*   The Farbridge pledge in the 2006 election campaign to build a new downtown library has never materialized. Instead $5 million has been spent to tear down two Wyndham Street properties with the promise to take down two more. The cost of this will be more than $10 million. Why are they doing this? Because they want the new library to front on Wyndham Street.

Add in the cost of the $63 million library that is not budgeted but promised to open in 2017, and it’s another case where secrecy and misdirected messages follow the Farbridge dogma.

*   Next came the secret agreements with Maple Reinders to design and build a new $34 million dollar organic composting facility on the site of the old one. The start-up of this facility has been delayed for more than a year. Then it’s revealed that the Regional Municipality of Waterloo has agreed to ship 20,000 tonnes of wet waste to the plant at an unknown price per tonne. The operating cost of running the plant has also never been revealed. So far, no wet waste from the City of Guelph has been processed in the plant.

Again, the public was not informed of the decision to proceed with this and secrecy still surrounds the project.

*   The city staff has increased by 556 full time equivalent employees between 2007 and 2011. The population of the city increased by only 3,500 during that period. Today the staff costs comprise 89 per cent of the annual city budget. In contrast, the City of Waterloo’s employee costs are 56.6 per cent of its annual budget.

These are only a few of the covered-up missteps by the Farbridge administration.

It is an exact case study of what Allan Gregg was addressing.

In Guelph political dogma has trumped reason at City Hall.

History has shown that dictators face a truncated shelf life provided the citizens enter the public forum armed with facts, reasoned arguments and ideas.

If we don’t act, the silence will be taken as consent to continue the policies that have brought us to this stage.

It’s time to act. Not more of the same,

 

 

 

1 Comment

Filed under Between the Lines

The Good, the Bad and the Ugly

Posted October 6, 2012

Judging from recent revelations, Guelph is about to lose its renowned title “the Royal City”.

Instead, it will become known as Garbageville, that place where the unwanted waste of North America can find a home.

It’s strange how events can shape policy. For instance when Dean Wyman, General Manger of Solid Waste Resources, announced the city is negotiating to bring in “dry” waste or recyclable materials from New York and Michigan. The question is, why?

Here’s the back-story. Seems the Guelph dry-waste sorting facility is running short of material to recycle. The reason is Waste Management has built a large, automated sorting facility in Cambridge. This operation is sucking business away from Guelph where sorting is done manually by a platoon of workers.

This has resulted in Guelph waste management to seek a solution. The answer, the brain trust feels, lies in the United States.

Really? Did the Wasters (I can’t help myself!) consider the solution lay in closing down the Guelph facility and ship the recyclables to Waste Management where processing costs are almost half of the Guelph operation? No, because that is against the Farbridge administration’s determination to be the leader in waste management.

Does it make sense to import from the U.S. and process it at a loss just to maintain jobs? You be the judge.

That’s the Good part of this essay.

The Bad part is the huge cost to Guelph taxpayers of building a $34 million wet- waste composting plant that is six times greater than the city’s 10,000 tonne annual requirement. Then they enter a contract with Waterloo Region to ship its wet stuff, at a cost estimated to be half of the estimated real operating costs of the plant. But wait! Even that contract will only use 50 per cent of plant capacity.

Another problem is that after a year of breaking in the “Microbe Motel”, it has yet to process any wet waste from either Guelph or Waterloo. Reason is the Ministry of the Environment (MOE) has not given the operation the green light. No authority, no operation.

It gets worse. Taxpayers have to pony-up another $15 million for a bin-based collection system. It was done despite MOE’s approval of using biodegradable plastic bags that would have continued the city plastic bag collection system without spending the $15 million.

And this was done without any city testing of the bins, using the automated trucks to see if it warranted spending the money.

The taxpayers, of course, had no say in this huge investment that has been built to serve other municipalities.

Starting to sense where this is going?

Now for the Ugly. Phase three in the administration’s waste management plan, and I use that term loosely, is planning construction of two stainless steel, glass lined silos at the waste water plant to store processed sewage sludge. The cost is estimated to be $20 million.

This plan is to store the stuff over the cold months and then it is taken by Lystek Corporation to be “re-watered” with raw human waste from septic tanks, aircraft toilets and porta-potties, then spread the liquid on agriculture lands.

The city entered into an agreement with Lystek five years ago to use the fully processed sewage sludge for its fertilizing programs of farmer’s fields, including pastures.

Get the picture? This allows some potentially deadly elements found in human waste to penetrate the food chain.

So far Lystek has only been able to use just 15 per cent per year of the Guelph sewage sludge. The company is only able distribute the stuff between April and November.

So Lystek has persuaded Guelph to store not only the city’s sewage sludge but also that of other municipalities.

This is the perfect trifecta of gambling with taxpayer’s money.

When did Mayor Farbridge announce that Guelph was going to finance and service waste disposal of other communities?  Why aren’t the taxpayers informed of the details of these major capital-spending plans?

I guess we missed the memo.

Leave a comment

Filed under Between the Lines

There they go again, when Tom Thumb meets Humpty Dumpty

Posted October 3, 2012

The city staff trots out a new proposal: Spend $4.4 million to upgrade the city’s ability to communicate better and faster.  It comes on the heels of a staff recommendation that the 2013 property tax increase must be 8.5 per cent.

This proposal follows a textbook staff strategy of selling high and accepting low. This has been going on for a long time and has become tiresome and childish.

The senior staff who formulate this strategy on an annual basis, must believe that its political masters are gullible and the taxpayers incapable of understanding how city business is conducted.

The whole scheme usually works, as the majority of city council is dependent on the staff to make decisions. Unfortunately this has led to the corporation being run by a small group of ideologues led by Mayor Karen Farbridge. Not unlike U.S. President Harry Truman in the late forties, the buck stops with her. Perhaps given the Mayor’s political bent, it may be an odious comparison. Mayor Farbridge is no Harry Truman.

Recently, Ann Pappert, the Chief Administration Officer, informed council that its directive to have the staff come up with a three per cent increase in property taxes was a “regressive decision.”  Her remarks also included that the order was not “palatable”.

Meanwhile Coun. Ian Findlay runs around like a rabbit complaining about a report carried in Coun. Cam Guthrie’s blog. Guthrie proposed at a public meeting that any surplus be distributed to taxpayers, but first used to top up the tax stabilization reserve that is currently underfunded. The majority of council defeated it.

That didn’t satisfy Findlay. He tabled a notice of motion that was predictably vague in requesting an investigation.

If the Mayor is as smart as she appears, she’ll sandbag that proposal. She can read the public’s distaste for calling in the Integrity Commissioner again.

The real problem is the distance that exists between what the staff proposes and what council can accept politically. The city’s ability to pay for the mega capital projects already approved has reached a limit.  Adding to the capital projects list is a new downtown library ($63 Million); a new riverside park ($16 million); two sewage sludge storage tanks (estimated $20 million); a South end recreation centre ($37 million).

Then throw in the cost of the lawsuits and OMB hearings yet to be resolved: The $19 million suit against the city hall contractor; the Ministry of Labour suit regarding the collapse of a city owned washroom wall that killed a teenager; The OMB hearing regarding the private proposal to build two tower residences for student housing

Underlying all this is the lack of transparency practised by the city administration. They tell you want they want you to know, not what you need to know.

Latest in the city news follies is the report that the capital budget next year will be maxed out at 20 per cent of the total 2012 budget. The spending figure is  $51.5 million. Doing some quick math, that means next year’s budget will be $257.5 million. City staff admits this will put upward pressure on property taxes and, more importantly, the 2013 budget, yet to be decided.

It is now growing clearer why the staff, led by CAO Ann Pappert, is pushing for an 8.5 per cent increase of property tax rates for 2013. What is unclear is how this 10-year “forecast” was decided and by whom?

Funding for the downtown library includes buying two more properties on Wyndham Street to accommodate the project, but not the project itself. Council has already spent more than $5 million of two Wyndham properties turning the vacant site into parking. You may recall the statement by the chief librarian that the new library would be open for business in 2017 … that’s not in the 10-year forecast.

The same forecast calls for funding of a  “ feasibility study” for the South End recreation centre.

There they go again. Is it not clear that resident’s in the city’s growing South End want a rec centre? Are Ward Six councillors Todd Dennis and Karl Wettstein not tuned into that situation? No? Okay we’ll bring in another consultant and do a “feasibility study”.

Let me tell you what most people in the city are ticked off about. The use of outside consultants when there is professional expertise within the ranks of staff; the endless planning that ties up staff in the name of strategy; the difficulty of doing business with the city, be it development, contracts or planning.

It all boils down to citizens wanting the truth, transparent communications, fewer council meetings held in private in and out of City Hall, and a regular, clearer picture of city finances.

If the 2012 operational budget of  $174 million contains a surplus, and the staff costs represent $154 million where does the city figure next year it can spend $51.5 million on capital spending?

That friends, does not add up.

3 Comments

Filed under Between the Lines