CITY VIEW – How power corrupts through bare-knuckle deceit

Posted August 2, 2013

Most residents would not be aware of a city-owned company called Guelph Municipal Holdings Inc. (GMHI). This was created by the Farbridge administration shortly following the unsuccessful attempt to sell the city-owned Guelph Hydro a few years ago. It was a stunning defeat for the Mayor who vociferously advocated the sale without revealing the the proposed merger business plan with Hamilton and St. Catharines power companies.

There was general public outrage over the secretive plan developed by the Mayor and members of the Guelph Hydro board.

Following that decision, the Mayor convinced council to redeem a $30 million note owed by Guelph Hydro. This note had an attractive interest rate and was producing income for the city of more than $1.5 million annually. That dividend disappeared quickly to cover the stimulus costs and other projects.

Not deterred, the Mayor formed the holding company to take over all city owned assets with the main asset being Guelph Hydro that is now valued at $130 million.

The board of directors of this holding company includes the Mayor as chairperson, four city councillors, Lise Burcher, June Hofland, Todd Dennis and Karl Wettstein. Also the board includes the chairperson of Guelph Hydro, Jasmine Urisk and two independent directors Edward Sehl and Mark Goldberg.

Of course this set-up ensures complete control of the holding company board that is dominated by Mayor Farbridge and four of her council cohorts.

But it gets better; the officers of the GMHI are CEO Ann Pappert, Al Horsman as treasurer and Donna Jacques as corporate secretary. These are all senior staff in the City of Guelph.

One would believe that the Mayor is in the catbird seat under this arrangement with no opposition and freedom to do just what she wants.

Here’s a new development.

In a GMHI news release, a 2013 priority is to reconsider selling or merging Guelph Hydro Ontario. The recommendation came from a provincial appointed body the Distribution Sector Review Panel. It suggested that local energy distributors be consolidated into larger distributors. Guelph Hydro was among those listed.

The release went on to say that there exists a possibility that such a consolidation may be provincially mandated or “driven” by the regulator, the Ontario Energy Board.

This is nothing but fear-mongering in which the GMHI board is setting the taxpayers up for a disbursement of ownership of Guelph Hydro. Using information from provincial organization to achieve something that was soundly defeated before is the height of arrogance and an ill-disguised attempt to grab cash.

This administration has power to burn and they are succeeding in ways that are distracting, secretive and void of the best interests of the people they serve. These are individuals vested with power whose point of view does not reflect the views of the majority of stakeholders.

One saving grace is that with the political turmoil in Ontario, there is little chance that a takeover of Guelph Hydro is an issue that political parties would support.

The Liberal government lost three seats in the recent by-elections and the main issue was its handling of the Oakville and Mississauga gas plants cancellation that cost more than $500 million.

You can count on energy being a major issue in the next election, possibly this fall.


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