Your GuelphSpeaks Weekender

By Gerry Barker

Posted December 13, 2015

How the people won the battle of 2014 but lost the war

We elected a dysfunctional council last year but now the traditional Councillor Christmas Party has been cancelled this year, the first year of their mandate.

What happened to civility, collegiality and good will among the members?

It probably was shattered the first meeting of the year when the majority of seven supporters of the progressive councillors elected, voted in their slate of committee chairs and board members.

In its first year in office, city council has increased property taxes by 6.95 per cent, the total for 2015 and 2016. That does not include the 4.12 per cent increase in water rates for 2016. The costs to the taxpayer is a 2016 increase of 7.11 per cent on the combines tax bill and water bill.

August 2014, the Police Heaquarters project

First, let’s review some history. Starting with a look back to August 2014. Outgoing Guelph Police Chief Bryan Larkin colluded with Mayor Karen Farbridge4 and Coun. Leanne Piper, the two elected councillors serving on the Guelph Police Services Board (GPSB). In January of 2014, the GPSB approved a renovation of the downtown police headquarters to cost some $13 million.

It became a crusade for better digs for the cops. Chief Larkin pushed for a more extensive renovation of headquarters. The GPSB hired project consultants and accountants, KPMG, to do a study that was used to convince city council to spend an estimated $34 million or $21 million more than the January estimate.

With an eye on the looming election, city council voted to spend the $34 million. There was no business plan, no detailed description of the work and no management plan of the staff moving to accommodate the construction. It was a manufactured rationale that was meaningless without the pertinent details to justify a $34 million acceptance.

About a week ago, Guelph Deputy Police Chief said the project completion was delayed until mid 2018 because detailed drawings and staff management had to be developed before asking for construction bids to do the actual work. On December 8, the bids had to be submitted to the city. This was more than 15 months after council approved the $34 million project.

Consider an inflation rate of 2 per cent times 15 months; the base additional cost of the project is more than $680,000 even before contraction begins.

Larkin has long gone to become Chief of the Waterloo Regional Police Service. Karen Farbridge was defeated in the October civic election. That leaves just Coun. Leanne Piper as the only survivor of the day council’s GPSB representatives sold city council on paying the estimated $34 million bill, the real cost of which has yet to be determined.

If this doesn’t smell like a replay of the $23 million cost overrun, building the new city hall, then perhaps we’re just being either cynical or naive.

September 2014, the Urbacon $8.96 million settlement

The second item of history lies with the settlement, announced in September 2014, paying Urbacon Buildings Group $8.96 million following the new city hall contractor’s $19.2 million lawsuit. Following the bouncing ball, the total overrun of the project zoomed from $42 million to $65 million.

The overrun was the direct responsibility of the Farbridge administration.

Both the police HQ and Urbacon settlement total capital spending is $57 million, before the 2014 election.

The city does not have $8.96 million lying around, let along another $34 million. Chief Administrative Officer, Ann Pappert, said the settlement would not impact property taxes and the reserves would be replenished by paying $900,000 a year for five years. That was the staff plan to pay just half of what the settlement cost the reserves.

When the 2015 budget was approved in March this year, Coun. Karl Wettstein moved that the replenishment of the three unrelated reserve funds that were raided to pay off Urbacon, be reduced from $900,000 to $500,000. It’s called kicking the ball down the road for someone else to catch.

He further said that the city staff prepare a revised reserve repayment plan for 2016. More kicking the ball down the road. The city’s operations review, carried out by BMA Management Consultants, noticed this reserve funds depletion, exacerbated the growing problem of under-funded reserve. The warning expression in their report was: “Cautionary Red Flag.”

Addressing Ms. Pappert’s assertion that property taxes would not be affected by the Urbacon settlement, it turns out we are paying 30 per cent higher property taxes in 2015 and 2016 than we did in 2014.

But here’s the truth. The city staff, led by Ms. Pappert and her Deputy CAO, Mark Amorosi, did not recommend any revised Urbacon reserve repayment plan in the 2016 budget, as instructed by Coun. Wettstein. So, how are they going to pay it back?

Nor there is no mention of the impending Police HQ renovation capital costs and the impact on the city’s 2016 capital budget.

Is it any wonder that there is a majority bloc of neo-progressives, whose experience in financial matters, to be charitable, is limited particularly in dealing with an operating budget of $216,442,599? More than 25 new staffers have been hired since the current council was elected. Some are in the process of being hired.

Zooming staff costs

The 2016 staff cost of wages, salaries and benefits will hit more than $200,000,000, or a cumulated gain of 52.5 per cent since 2008. That cost is directly paid through the property tax levy. Consider that for every new staff hire, annual increases in wages, salaries and benefits; the property taxpayer, that’s you and me, directly pays the cost. It is the major reason that Guelph’s property tax levy per person is among the highest in the country.

The failure to contain these costs lies directly with the senior staff management who are supported by the controlling progressive bloc on council. The following are the members of this bloc: Leanne Piper, Cathy Downer, Mike Salisbury, Karl Wettstein, Phil Allt, June Hofland, and James Gordon.

It’s called the 7-6 group and it will not change until 2018 when the next civic election is held or a bloc member defects to support Mayor Cam Guthrie and his supporters.

This is why we the people won the battle but lost the war.

Postscript

Maybe the war’s not over yet. Perhaps some positive changes can be introduced to ameliorate the surging cost of living in Guelph. Optimism works much better than the present negative polarity that is like a dragging boat anchor, stalling responsibility and common sense.

We can never lose the core spirit of our city and council’s responsibility to represent all the people, all the time.

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5 Comments

Filed under Between the Lines

5 responses to “Your GuelphSpeaks Weekender

  1. Glen N. Tolhurst

    The council via its 7 member bloc(or is that block heads?) pushed thru a budget with a 2.99% property tax increase and patted themselves on the back even thought the year to year CPI increase was only 1%. Hidden from sight during the budget debate on adding & deleting line items was the end run suggested by the newbie Finance GM & Treasurer who pronounced the city to be a lean organization and then proceeded to slip what would have been an additional 4.62% tax increase for capital spending into debt. That’s like using your credit card for Xmas goodies and not worrying about the bill coming in the future years. Furthermore, any possibility of having an outside consulting firm (preferably one with Lean Management experience) carry out a “service rationalization process” got cut as the shortsighted members of council viewed it as a cost rather than an investment that would have a positive payback. The $450,000 for that item could have easily been paid for by deleting the so called “open government” position and a few other dubious items.
    All in all, the taxpayers get shafted again & the bloc of 7 should get a lump of coal from Santa.

  2. Fred

    Mike Salisbury says that “It’s a no-brainer.” It certainly is.

  3. Fred

    A special 2% levy for 10 years on top of the regular property tax is proposed by city staff. How about you lay the staff off and give us a tax cut?

  4. geo

    A special levy is bureaucrateese for tax increase.
    Liars and thieves!

  5. Glen N. Tolhurst

    Take a look at the math.The 2% levy becomes part of the base each following year. 2% compounded over 10 years is a 21.8% increase, just for this infrastructure levy alone. This would be on top of any tax increase as well as water & hydro increases. Who can afford this? Time to do a house cleaning of the fuzzy thinking councillors & city staff who think taxpayers are ATM’s.

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