That giant ripping sound is your tax dollars being seized by an administration that can’t count

Posted February 20, 2014

February 19, 2014 will go down in our city’s history as an election epiphany. It reveals vital information for every taxpayer to carefully consider as to whom they should support in the October 27 election.

In this special report prepared by GrassRoots Guelph’s (GRG) financial analysts, Guelph’s property taxpayers have been overtaxed by $86,841,000 in a three year period, 2010 to 2012. The details of this analysis can be found in the attached GRG members’ Alert.

The same information has been forwarded to the Ministry of Municipal Affairs and Housing (MMAH) as an addendum to the original petition presented by GRG to the Minister last October.

This is yet another example of the good work by GrassRoots Guelph, an independent citizens organization. It is one that analyzes and interprets how your city has been mismanaged in the past seven years of the Farbridge administration.

GRG has become the real opposition to the administration as the mainstream media blithely ignores digging for the facts. Reason? They don’t have the resources to investigate and analyze. Further, they will not spend the money to hire those resources. The result is that reporters become dependent on information provided by the city administration. There is little critical examination or commentary thereby readers lose this last bastion of political checks and balances so necessary in a democratic society.

The answer for citizens is to follow GRG on its website, grassrootsguelph.com and the blog, guelphspeaks.ca. Both these sites are dedicated to the truth and to inform all citizens regardless of their political beliefs.

This new report is based on official financial statements filed by the city administration in its obligatory annual Financial Information Report (FIR) to the province. It demonstrates the fiscal fallout of chaotic management of budget forecasting by senior city staff. It seriously reflects on the majority of elected members of council who failed to carry out their fiduciary responsibilities to the citizens, and turned a blind eye.

But you be the judge.

GRG Alert #12 to its members

As you know, GrassRoots Guelph submitted a petition to the Ministry of Municipal Affairs and Housing on October 1, 2013 requesting that the Ontario government conduct an in-depth audit of the City of Guelph’s finances and operations.

Subsequently three GRG representatives met with two MMAH representatives in Guelph on November 25, 2013 as they began their investigation into our request.  During this meeting, the MMAH representatives “confirmed the accuracy” of the numbers in our petition and we presented them with an additional six more items to add to it.
We have not heard back from MMAH since our meeting in November, even though we submitted more petition signatures to them in December.

Therefore, today, we submitted another two issues to the Ministry to supplement the original petition. This is part of our continued efforts to press the Ontario government to audit Guelph’s finances and operations and explain the many discrepancies and examples of mismanagement we have uncovered in the City’s financial statements.

The two new items are provided in full below.

These items are so critical that we sent them out in a press release this morning to all of the print, broadcast and Internet media outlets that cover Guelph. This is our second press release in two weeks. Last week, we issued a press release providing our analysis that the average 2014 property tax increase in Guelph will be 4.36%, not 2.37%.  Unfortunately, when we issue a press release, there is no guarantee that the media will use the material we give them.  However, we’re trying to get key information out to the general public using these outlets…and we’ll keep trying.

After all, Guelph’s residents deserve to be well-informed on these matters before they head to the polls in October!
 
Please share the following new petition items with your friends and family. If they want to join GRG so that they can get more information about what is happening at City Hall, please have them go to our website and complete our contact form (http://www.grassrootsguelph.com/contact/).

Petition Addendum – February 19, 2014

Section 1: Finances –
addendum to petition paragraph H)

In 2010-2012, according to available figures, the City of Guelph underestimated revenues by $105,955,000.  Since it also exceeded budgeted expenditures by $19,114,000 during this time period, Guelph taxpayers were over-taxed by $86,841,000 for 2010-2012.

This $86.8 million in unnecessary taxes was not a case of wildly gyrating numbers making it difficult to forecast revenues accurately.  In fact, audited revenues were surprisingly stable, totaling $379,887,000 in 2012; $379,882,000 in 2011; and $368,338,000 in 2010.

Rather it is, in our opinion, the result of a severely flawed budget process.  In the budget process, the difference between expected revenues and budgeted expenditures is the basis for determining the annual amount of taxes that residents must pay.

The revenue surplus of $105,955,000 over 2010-2012 reveals that the City of Guelph’s administrators do not have the means to forecast inflows with reasonable accuracy, and therefore consistently calculate tax levies that completely fail to reflect the reality of the differences between revenues and expenditures.

Addendum to Petition
- paragraph I)

In 2010-2012, the Finance Department reported questionable numbers regarding waste management assets in Schedule 51 of the Financial Information Report.

In 2010, in the Waste Management Division section of the report, the value of gross plant (i.e. the total accumulated assets of this operation) was $40,973,921 and annual depreciation was $3,857,031. In 2011, gross plant value rose to $69,308,440 while depreciation actually declined to $3,182,558.  In 2012, gross plant rose again to $76,407,350 and depreciation was $4,146,577.

Thus, over this 3-year period, the city stated that gross plant value rose by 86% while depreciation rose by only 7%.  In our opinion, this is another example of accounting inconsistencies that if done intentionally, would be considered “cooking the books”.

Written by Paulette Padanyi, GRG Commuications

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