Why Guelph’s legacy of irresponsible management continues an ongoing financial crisis

By Gerry Barker

April 8, 2016

When Deputy Chief Administrative Officer(DCAO), Mark Amorosi, says his department conducted a market review of senior management salaries, turns out the three top management staffers looked after their own salary increases in 2015.

Comparing the Guelph Sunshine List, (reporting public employees earning more tha $100,000 a year), to other similar-sized communities, it is apparent that the so-called market review to estimate what senior managers should be awarded, turned out to be self-serving, flawed and manipulated.

The evidence now is the admission by Coun. Karl Wettstien that council had no control of challenging the salary increases of any employee under the rank of Chief Administrative Officer (CAO), Ann Pappert.

Does this elevate the CAO to a position that she runs the operations of a $382 million budget with no recourse, no objection, no public input, and no control involving the public interest?

This is yet another hangover from the previous administration. Two people for the past five years have run our city, former Mayor Karen Farbridge and her hand-picked lieutenant, Ann Pappert.

Here’s how Ms. Pappert’s 2015 salary of $257,248 compares to Kingston’s CAO, Gerard Hunt, who was paid $215,764 or $41,484 less than the Guelph CAO. Or take Kitchener’s CAO Jeff Willmer, who earned $213,029 or $44,219 less than Ms. Pappert.

So what basis was there to award Ms. Pappert with a 17.11 per cent increase in 2015? Mark Amorosi claims there was a market review, comparing salaries of CAO’s. The report must have left out the two most obvious municipal comparisons, Kingston and Kitchener.

The pattern of control by the council dominated Bloc of Seven

The Bloc of Seven, seven councillors elected in 2014, controlling the council follows the policies of the former leadership of the left, the defeated mayor of Guelph, Karen Farbridge. She set the rules to establish tight control of the administration. Her followers elected to council, slavishly follows her direction and vote to support her strategies, policies and financial management.

After eight years, it resulted in a monumental financial disaster called Urbacon that cost the city $8.96 million to settle.. It cost her and some councillors their jobs. The fallout was the comparison of Guelph’s operational and capital costs in 2014 that were 50 per cent higher that either Cambridge or Kitchener.

Today, the remnants of these destructive policies are the same old gang trying to prevent any reform or reduction of costs.

Guelph has 12 general managers whose responsibilities and salaries vary by the scope of responsibility. Here is the list of general managers, their salary and taxable benefits in descending order:

Kealy Dedman – GM Engineering and Capital Infrastructure –      $170,637 – $756

Donna Jaques – GM Legal Services city solicitor                                   $158 997 – $1,667

Todd Salter – GM Planning, Urban design, Building Services         $157,978 – $767

Peter Cartright – GM Business Development and Enterprise         $153,997 – $3,467

Peter Busatto – Plant Manager Water Services                                      $152,188 – $699

Rodney Keller – GM operations                                                                   $142,491 – $4,299

Colleen Clack – GM Culture Tourism, Community Investment      $142,017 – $1,599

David Goodwaldt – GM Human Resources                                               $140,003 – $699

Kristene Scott – GM Parks and Recreation                                               $140,003 – $699

Phil Meagher – GM Guelph Transit                                                             $137,566 – $676

Mario Petricevic – GM Facilities Management                                       $127,206 – $2,435

Laszlo Petroczi – GM Guelph Junction Railroad                                     $110,448 – $538

In 2015, the city staff had 15 senior managers including the top three. Take another look at that list. There is no general manager of finances let alone a Chief Financial Officer (CFO). For more than 15 months, Guelph has been without a CFO. Instead, DCAO Mark Amorosi, head of Corporate Services, assumed responsibility for financial management.

Two budget cycles and still no CFO

Under Amorosi’s watch, we have gone through two General Managers of Finance and currently the vacant position is being filled with an in-house senior financial staffer. What more evidence do we need that Mr. Amorosi, who holds no accredited financial background, is out of his depth managing the city’s finances? Couple that with the chair of the finance committee, June Hofland, whose financial background consists of being a former bank teller.

These two people are managing the finances of a $500 million corporation with an annual budget of $382 million. The past three years management has overspent its budget by and average of more than a million dollars. Because the city must report a balanced budget to the province, raiding the reserves covers up the budget excesses.

Also, missing from the list are those employees of Guelph Municipal Holdings Inc (GMHI) who earned more than $100,000 in 2015. Only one shows up as GM of Guelph Junction Railroad that is part of GMHI. There are no Sunshine List salaries from Guelph Hydro or Envada Corporation, also components of GMHI. These employees are paid from the public purse but not included in the Sunshine list. The revenue backbone of GMHI is Guelph Hydro. So when GMHI sends a $1.5 million dividend back to the city, it comes, indirectly, from your Hydro payments.

Since GMHI was formed by the previous administration, it has lost money but paid dividends totaling $9 million to the city general revenues. In 2014 alone, $1.5 million was delivered to the city while the financial statement of GMHI showed a loss of $2.8 million. There will be a report of GMHI due in June that could reveal other loses. (GS will have more on this subject later). In the the recent GMHI reorganization, the board was replaced with more council oversight of its activities.

DCAO Amorosi’s area of responsibilities also includes the annual human resources report in which he reports the full-time staff is 1,275. What it leaves out are some 45 per cent of employees paid from the public purse including part timers, contractors, police, fire and EMS.

A further subverting of the public interest is the use of closed sessions of council. These meetings are secret and participants are warned that they cannot discuss the closed sessions.

This is how those three super-sized salary increases to Pappert, Amorosi and Thomson were not revealed for a year after the council approved. The only reason the public found out was the provincial 2015 Sunshine List revealed the increases, not the city.

It’s time to put a stop to our city being held hostage by the same people who caused the operational problems accumulated in the past eight years.

Let’s take back our city.

 

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7 Comments

Filed under Between the Lines

7 responses to “Why Guelph’s legacy of irresponsible management continues an ongoing financial crisis

  1. The Towne Winer

    You are the only transparency we have now in Guelph …not good …and thanks for asking for accountability despite that you are harsh nevertheless, but The Bear is not harsh/ opinionated whatsoever himself…????

    And I have blasted your blog out a helluva lot more GB because it’s for the benefit for the masses do to learn so….,

    The Bearmeister

  2. Andre

    Where did all the savings go when they restructured and got rid of Laird, McCaugan, and the previous department heads? Wasn’t it Amorosi who fired the previous GM of Finance – Katrina Powers under a re-org? I think she was an actual chartered accountant too. As reported to the lawsuit of Bruce Poole, didn’t a bunch of senior managers get down graded with reduced salary – where did all that ‘staff savings’ from these reductions end up going? It seems like they fired people to beef up their own salaries. Amorosi doesn’t have an accounting degree, and Derrick Thompson doesn’t have any university education and yet he seems to have the biggest department. Does Council realize that these people are in charge and are not qualified for their roles? If not Council, does Pappert realize she has unqualified people as her deputies? Amorosi’s background is HR and obviously he bundled up the reorg they had (and can’t retain a certified accountant as treasurer who has to abide by professional ethics). Thompson can’t make his arena staff follow the building code and get the permits, (as reported a few weeks ago) nor can he keep a parks and rec GM – he too got rid of 2 and one quit. Does Pappert not see this as a management problem? Does council not ask why there are such issues with management? It’s like amateurs are in charge and their oversight (Council) doesn’t care because they are divided and fighting with each other. I’d like to see any argument why Amorosi or Thomspon should keep their current pay and keep their job. If this Council wants to back them then this Council can go down with them.

    • Andre: We’re on the same page. This is an excellent analysis of the management abuse of the public trust. They conduct the public’s business behind closed doors. They are contemptuous of the citizen’s concerns and use our money to deflect complaints and criticism. Does this look like a dictatorship by unelected managers and supported by seven councillors. Perhaps if citizens turned off the property tax revenue stream, council and the paid senior management staff might reconsider their wasteful decisions and reform.

  3. geo

    This Municipal government has become a leech. It’s only role is to latch on and grow larger, offering nothing in return.

  4. Len H

    Unfortunately, if I am not mistaken if you fail to pay your taxes you will be living at the crowbar hotel before long. Not sure if there is any recourse before the next election and even then the lefties are so much more organized with their slates that nothing will change. And likely Farbridge will be back because most people will think these problems’s are the current mayor’s fault, not really researching who the real villains are. Maybe time to man the barricades…”Can you hear the people sing?”… (Love Les Miz)

    • Len H: We are not powerless and I believe the left, including councillors and senior managers, are a little edgy right now because of the secret salary increases awarded to the top three staff managers. They covered it up until 15 months past before we knew of the magnitude of those increases.

      The people have endured a lifetime of bad management, excessive spending and high taxes. Conducting a tax revolution in Ontario’s municipalities is no easy task. Bringing pressure on council is one method but it needs numbers and fact-based objectives to get the administration to change.

      A tax revolt calls for personal guts. For nine years now the city administration has used your property as ATM machines to boost revenues. All you have to do is check your property tax demands over the past eight years; plus the increase costs associated with water usage — in and out; electricity bills; special assessments such as storm water maintenance.

      So if 1,000 property owners pay only $100 for the April and June tax installments, that will deprive the city of $20,000,000 in lost cash-flow. That’s 10 percent of the total property taxes on which the city depends in 2016. What’s the worse that can happen? It will take months for the city tax office to send out a blizzard of demands for payment. You will be charged usury interest rates for non-payment. You are paying a portion of your taxes that prevents seizure of your property. The action by just 1,000 taxpayers would be enough to get the administration’s attention that the people are mad as hell and won’t take it anymore. This would swamp the tax office and create a crisis. That’s how we get their attention.

      P.S. I’d love to see Karen Farbridge run again for Mayor in 2018. There’s no way she can convince people that her track record is clean.

  5. Len H

    Well responded, Gerry.
    So what do we do?
    Get 1000 people plus to sign up to with hold?
    I am in, but not alone. Who wants to put it on the line? Let’s do it but let’s be organized and make sure our message is heard, not just on this blog, but throughout the city. An avalanche starts with a little tremour.

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