What were they thinking when they cut a new deal with the Guelph Srorm?

By Gerry Barker

July 27, 2016 (revised)

This week Mayor Guthrie announced that the Guelph Storm junior hockey club would remain in Guelph for another ten years.

I’m a hockey fan but this deal has the strong odour of an inside deal.

Here’s the financial skinny.

Deputy Chief Administration Officer (DCAO) Colleen Clack told a citizen recently that between 2011 and 2015, the taxpayers subsidized the Sleeman Centre averaging $249,000 a year.

Why under her responsibility as General Manager of Tourism and Culture, was she responsible for managing these two facilities? According to her own figures, the River Run Theatre is losing more than $531,000 annually and the Sleeman Centre is losing $249,000 each year. That’s $780,000 a year! Now that was under the old contract signed by the previous owners of the team and was honoured by the new owners. Now remember, this building is owned and managed by the city.

We the public have no idea of the terms of the old Storm contract or details of the new one. We can tell you that three individuals own the team with the chairman, Rick Gaetz, who also is chairman of the Ontario Hockey League (OHL) executive committee.

It would appear that Ms. Clack, as lead negotiator for the city, agreed to lower the percentage of the city’s share of receipts. This was because the team owners said that the financial arrangement with the city was one of the costliest in the 20-team OHL. Was this a case of the lambs being led to the slaughter?

Again, no figures were produced to confirm this claim. There was no business plan presented to council, just a request to lower the city’s share of the revenues. Council approved the new deal. Again, the public was not informed of the details.

Why are we in business with a hockey team?

Why is this a shared revenue deal at all? As Mayor Guthrie said “We are the landlord and the Storm is a tenant.” Under that definition, the Storm should pay a negotiated lease payment amount for use of the Arena. The city has no business participating in the operation of a privately-owned major junior hockey club.

Why should the citizens be expected to subsidize the hockey club through this sharing of receipts or revenue? Because under the sketchy details of this deal, we are subsidizing the team.

Bottom line, if the Sleeman was losing $249,000 under the former agreement and has agreed to take a lesser part of the revenue pie, doesn’t this increase the amount of losses the Sleeman generates each year?

This is one of the oldest ploys in the book. Threaten to move the team and everyone on council goes into a funk. It went from a business decision to an emotional one in a nano second. Once again, the city comes out the loser. But do members of council get complimentary seats and VIP perks? Just wondering.

But there were Storm supporters claiming the economic advantages that the Storm allegedly brings to the city. It’s an interesting take with no measurement of the actual economic affect on the actual cost of running a city of this size.

For every dollar of revenue that is removed there has to be a truthful explanation as to how it affects the citizens. Does this deal benefit the majority of residents? Or is it just the owners of the team? The players are reported to be paid less than minimum wage

The fact that the building is shut down for three months in the summer adds more cost to the taxpayers. Why should the Storm occupation of the Sleeman Centre receive a 12-month deal when it is used, depending on reaching the OHL playoffs, for just some nine months?

In five years, there has been no attempt by the city administration to seek other users of the facility to help pay for maintenance, staff and operational costs. Why doesn’t the administration tell us how much the taxpayers must now pay to keep the Storm in town?

We’re already subsidizing the River Run Theatre across the street to the tune of $531,000 each year. Or take Guelph Transit that is subsidized by the taxpayers of some $15 million a year.

Is this what Coun. James Gordon refers to as an investment? He should understand the difference between capital costs and operational cost. These are only two examples of bad decisions that reduce revenues and reflect emotion rather than practicality.

You cannot run a city by spending money that has little or no benefit to the majority of citizens. This is one reason how the city has got itself in such a financial mess.

Reserves have been drastically depleted due to bad judgment and responsibility. The Community Energy Initiative cannot service in its present configuration without further investment. The administration has acknowledged it will require another $60 million to upgrade the two District Energy Nodes to meet future financial and performance obligations.

Coincidence or did they place an order before the deal was approved?

Yet eight members of city council voted to run the money-losing District Energy Nodes “as is” without further investment for another eight months to prove, what?

The same day, July 18, council approved the “as is” option of an eight-month extension of District Energy, Guelph Municipal Holdings Inc (GMHI) and advertised for a “Business Advisor” on a one-year contract to work for GMHI.

This council vote was held close to midnight, July 18, so the ad for the Business Advisor had to be placed before council approved the extension.

This is an outrageous and deliberate attempt to keep the District Energy Nodes alive despite the findings of the Deloitte consultant’s three recommendation options. Council voted earlier in the session not to proceed with Option three which was to continue operating the District Energy Nodes with more financing to make it viable.

This runs counter to the terms of the District Energy proposal “as is” option that stated there would be no further investment in the project. One would presume that includes adding to the staff.

It is now apparent that these two deals were cooked up behind closed-doors, without any public input or consideration.

We have a Frankenstein council, with the majority obsessed with holding power, controlling us, with most of the majority not understanding for that of which they are responsible. So they depend on the judgment of senior staff. Shades of Urbacon and generally most councillors vote as they are told!

An atmosphere of incompetence pervades our city leadership. It acts like a boil that we keep picking at until it festers.

The mother of all leaks

Mayor Cam Guthrie is chairman of GMHI. Yet the advertisement for a GMHI Business Advisor was posted during the day, hours before the council decision to accept the “as is” option around midnight.

But here is the question: Mayor Guthrie voted against the motion to accept the “as is” option. Is it not strange that the chair of GMHI was unaware of the staff posting to add another GMHI employee, hours before council approved it?

The action by staff illustrates why city council is disfunctional. That decision to post for another GMHI employee was apparently made without the knowledge of the Mayor. Someone in the administration, staff or elected members made that decision knowing full well the council would vote for it that night.

There were three votes that night. The first was to receive the staff report based on the findings of the Deloitte consultants containing three options, 13-0. The second was to continue the “as is” option, 13-0.

The third vote was 8 to 5 with all members of the Bloc of Seven plus Coun. Bob Bell voting to include a city-wide CEI and District Energy strategy presentation no later than Q1 of 2017. Only Mayor Cam Guthrie, Councillors Christine Billings, Dan Gibson, Andy Van Hellemond and Mark MacKinnon voted against the motion. The fact remains that this vote confirmed extending the DE operations for another eight months.

There will be more on this later. It is a complete breakdown of the public trust and the person or persons who perpetrated it should be fired or resign.

But hey! We have a junior hockey team for another ten years but we’ll never know the cost

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She promised to put Guelph back on track instead we got a financial train wreck

by Gerry Barker

July 24, 2016

Most people thought the 2006 Karen Farbridge election slogan of “Let’s put Guelph back on track,” was catchy and promised great expectations.

It is apparent that the critical mass of over-spending by the Farbridge eight years of financial mismanagement, is rapidly reaching a disastrous climax starting right after Labour Day.

Financial Climax? What climax?

Let’s check it out. First, the reserves have been tapped out, in order to balance the books for every year since 2010. Why? It’s because the budgets were consistently overspent and the books had to be balanced. If the administration cannot stick to its own budget, it reflects financial mismanagement.

Then the new nine-year capital budget, starting this budget year has already been overspent, according to staff, by $170 million. Throw in the Urbacon city hall breach-of-contract lawsuit and unplanned overages totaling $23 million, and the $37.1 million spent on the Community Energy Initiative, and it’s no wonder the city is in financial trouble.

Toss in the annual subsidies spent on Guelph Transit – $15 million; the Sleeman Center – $249,361; the RiverRun Theatre – $531,440; a city staff numbering more than 2,100 full time equivalent employees (FTE’s) being funded by tax-funded revenue, representing 80 per cent of the total property taxes paid in the city.

What most people don’t understand is the long-term public liability to which taxpayers are responsible forever. Along with a matching contribution, most unionized workers contribute to a defined pension plan that guarantees a pension based on salary, wages, benefits and length of service. Most city workers belong to the Ontario Municipal Employees Retirement System (OMERS). The organization represents more than 270,000 Ontario public employees. The average retirement age for these folks is 55.

The math would indicate this liability, that the municipality must guarantee each employee’s pension. The exponential growth of the Guelph civic staff and remuneration has steadily increased that liability and the costs of carrying it.

The spending doesn’t stop with property taxes

Now add the city’s non-tax funded service increases including city water, Guelph Hydro, parking, use of city-owned facilities including the civic museum, libraries, the Farmer’s Market, donations to 10 Carden Street ($110,000), the Wellbeing operation ($150,000) and a multitude of user fees.

Next comes the annual $300,000 support to build bicycle lanes on major roads. Typical of the Farbridge-inspired financial management, in 2015, Coun. Mike Salisbury moved to spend $600,000 because the bike lane allotment wasn’t spent in the 2014 budget. Thanks to the Bloc of Seven (BOS), it passed.

In August 2014, then mayor Farbridge, persuaded council to finance a $34.1 million renovation of police headquarters. Here’s how it was financed: Tax funded debt – $16.3 million; tax funded police capital reserve – $3 million; Future development fees – $14.8 million. So, let’s get this straight, the police project was approved betting on that future development fees collected from OTHER projects would cough up $14.8 million!

Think about that. As a future developer you pay development fees that you believe will pay for infrastructure-connection to city services, parks, recreation, equipment and, oh yes, a library. Sorry that money has been pledged by a former council to finance a police building. Citizens are now saddled with some Farbridge fancy financial footwork to pay for this public safety Taj Mahal.

This has created a capital financial shortfall that cancels out the downtown library and South End recreation centre. Forget redevelopment of the Baker Street parking lot, mixing private funding with public money. What private developer would want to engage with the city with its track record of bungled civic projects? The former Building Inspector was fired by the city that is currently being sued because it failed to issue building permits for more than 50 city-operated projects. Bruce Poole, a veteran of 30 years working for the city, is seeking $1 million for wrongful dismissal.

That’s what we do know. The problem is there is a lot that we don’t know because of the closed-door meetings of council in which the members face discipline by the Integrity Commissioner for breaking the code of conduct. Councillors are forbidden to reveal the discussions, accusations, and opinions to the public.

As an aside, why wasn’t Coun. Mike Salisbury not investigated by the Integrity Commissioner when he blabbed that he tipped off friendly blogger Adam Donaldson. It was about the decision by five members of the BOS to walk out of a closed session meeting.

Do we have a council of 13 members or only the BOS who support the policies of the previous administration? That’s the situation why city council is dysfunctional, dominated by obstructionism that makes council unproductive.

The city administration takes an August siesta

With August looming, this administration has turned the city operation into a version of what happens every August in France. In that case, the country shuts down. There are no council meetings scheduled and activity slows to a crawl. Even the staff is give a half hour less per day, during August, to perform their jobs. That’s two and a half fewer hours per week.

Complicating this up-coming snore-fest is the realignment of senior management. Derrick Thomson was appointed Chief Administrative Officer (CAO recently) and Colleen Clack, Deputy Administrative Officer (DCAO) in charge of city operations and Guelph Transit. Mr. Thomson previously performed this job.

There is a learning curve to be taken and the political pressure is relentless being exercised by the Bloc of Seven (BOS) even when the city shifts into hiatus for more than a month, the BOS continues to dominate the administration.

But the rubber will hit the road, starting September 6, as the process of creating a 2017 budget begins. Already the staff is signaling that there are special levies in the planning stage. During a recent capital-spending workshop, DCAO Mark Amorosi, the man in charge of city finances for the past 19 months, denounced such measures as increased assessment-producing revenue and diverting the Guelph Hydro dividend of $1.5 million as “robbing Peter to pay Paul.”

Instead, Mr. Amorosi said, the way to go was some form of a special levy that other municipalities are using. Fasten your seat belts folks; the BOS is ready to support a two per cent, ten-year property tax levy starting next year. It will raise more than $230 million.

This is a serious situation but will the administration do something about it?

Their selling point to us will be that it will create funding for needed infrastructure renovation. Even the Associated Municipalities of Ontario (AMO) have labeled Guelph’s infrastructure shortfall at more than $220 million.

Not so fast, Tonto. This requires a reality check. The city is faced with excessive operating costs, high debt, and mismanagement of operations, terrible budget forecasting, and a political atmosphere that is bringing the finances of the city to its knees.

Most voters are starting to realize how self-serving members of council, plus senior members of the staff, have abused them and their personal finances. This group’s political agenda has to be halted and replaced by a plan of common sense recovery.

There is no easy fix but a resolute and responsible administration will start the process of repair to a shattered financial and political agenda.

One thing is certain; there will be a tax revolt if council approves a tax levy of two-per cent over ten years on top of another three -plus per cent increases of normal costs of owning property.

The road of recovery lies only with cutting operational costs. The fact that two neighbouring cities, Kitchener and Cambridge whise operating and capital costs are 50 per cent lower that Guelph’s, points to the need for reduction of those costs

That includes, reduction of staff and realignment of responsibilities; chopping funding of special interest projects and lobbyists; capping salary and wages and benefits for two years; kill the CEI and District Energy project; reduce operating subsidies to Guelph Transit, the Sleeman Centre and RiverRun theatre; cease the bicycle lane expansion allocation; resolve to change the unfair University of Guelph’s property tax deal that pays $75 per student per year. It even fails to reflect the effect of inflation since inauguration in 1987.

It is time to take our city government out of the shadows and return competent financial management to city operations.

This includes hiring an independent Chief Financial Officer to put the train back on track.

It’s time.

If you feel the way that I do, drop me a line at gerrybarker76@gmao.com. Collectively, we can bring about refortm and change.

A dysfunctional council most of whom fail to understand the financial implications of their actions

By Gerry Barker

July 21, 2016

Let’s confirm that Guelph’s council is divided and dominated by seven councillors who don’t have the guts to close down a $37.1 million failed energy project that doesn’t produce enough energy to pay the bills.

Mark your calendar that Monday night, July 18, is a night that will go down as a failure to do the right thing. The majority Bloc of Seven failed to arrest spending more money on a project passed by the former Farbridge administration saddling citizens with more debt that even the Urbacon fiasco.

Here are some of the facts that have made a nine-year capital-spending plan after only a year, firmly in the ditch. Yes, it already has a 2016 capital budget deficit of $170 million as the first year of a nine-year capital budget.

Monday night, a delegation asked council to build a new downtown library and, get this, not partner with private investors to finance it. The last estimate for a stand-alone downtown main library was $60 million, or was it $63 million? These days the way some staff and activists are running the finances of our city, one cannot tell what the amount is. Nor did the two delegates produce a figure.

Take the Community Energy Initiative (CEI). On May 16, staff gave specific figures on how the previous administration launched a District Energy plan that was composed of two operating Nodes.

The downtown Node was located in the Sleeman Centre and the other in the Hanlon Creek Business Park. Total cost was $8.7 million. The financing and operational details were conducted in secret and hung in there for five years before Mayor Cam Guthrie, last year started asking staff for financials on the CEI operations. He especially questioned the District Energy Nodes that were connected to buildings downtown and in the Hanlon.

According to a detailed staff report July 18 on the District Energy operations, the cost of this operation, were managed off the city books through Guelph Municipal Holdings Inc (GMHI) and Guelph Hydro. Two Guelph Hydro subsidiaries corporations, Envida Community Energy Corporation and Guelph Hydro Electric Services Inc, were used to implement the District Energy project.

Adding up the costs of this adventure to develop sustainable energy and thermal hot and cold water to nearby customers, are estimated to be $37.1 million. That excludes the $68.5 million currently sitting on the city books as an asset.

The cupboard is bare

Here’s the nitty gritty. GMHI and Envida have zero financial capacity. Envida owes GMHI $11.8 million. GMHI is being carried on the city books as an impaired asset of $68.5 million. Today, because of the impairment, the asset is being depleted in value because the carrying charges exceed the capital on the books. Result, it is converted on the books as an expense as the value of the asset declines. Now the cost of carrying the asset exceeds the value of the asset.

Despite this damning evidence, on Monday night, July 18, council voted to adopt a strategy prepared by consultants Deloitte, to keep operating the money-gulping Nodes until the first quarter in 2017. Then, results will be reviewed. But there is not to be additional capital invested. Deloitte calls it the “As Is” option. Their fee for this analysis is between $130,000 and $160,000.

To this observer, this looks like another method by staff to hire a consultant to create a plan supporting, at the time, a point of view to salvage the project. Later evidence produced by staff, reinforced what everyone feared … it was a major expensive flop.

Oh! In order to make the Nodes able to meet a commitment to the Ontario grid of 10 MW for upgrading each Node, the price is estimated to be another $60 million. And there’s more, if the Nodes are shut down, there will be costs to cover broken contracts plus retrofitting some buildings to return to standard sources of hot and cold water and heat in some cases.

And yet city council receiving all this detailed information, prepared by the city staff, voted to keep the Nodes running until next March.

Two councillors urge not to look back

Two councillors stated that it was a waste if time and money to investigate those responsible for this ill-conceived and carelessly managed project. Coun. Mike Salisbury said any attempt to pin-point responsibility was “political.” He was joined by Coun. Phil Allt who said any recriminatory investigation would be a waste of staff time and money.

Phil, that money has already been spent by staff and Deloitte. They had to untangle the facts surrounding this failed exercise. It is one that does not produce power to the grid or provide any environmental benefit, zero.

The only beneficiaries are that handful of nearby buildings hooked up to the Nodes to supply hot and cold running water. It still requires natural gas to operate the Node pumps.

Jason Dodge spoke to council and affirmed the previous administration that they were not justified bypassing proper business planning. He added the project exemplifies loss of public trust in past councils and credibility. Mr. Dodge said the city needs a council that takes responsibility and holds itself accountable.

Up speaks Coun. Phil Allt to demand what evidence Dodge had that the previous council didn’t do due diligence.

Phil, you had better start reading your staff reports. There is ample evidence that not only was there no due diligence but there was no evidence of accountability. This was because the practice of the former administration was to conduct its business behind closed doors.

Two members of the present council, councillors June Hofland and Karl Wettstein, were present at those meetings of GMHI more than five years. Yet they did not, it appears, even inform their council colleagues of events that have led up to this $37.1 million cost to the city.

Coun.Wettstein made the comment that he believe the new CAO and city staff understand the problem and he is confident they will handle the public fallout of the project. “I am proud to be able to vote for this in its entirety,” he said.

How can Coun. Karl Wettstein keep a straight face?

Is he serious? He refuses to take any responsibility for his role as a member of the GMHI board of directors

Mayor Guthrie was on target to shut the District Energy Nodes down but the majority of council disagreed. The Bloc of Seven was joined by Coun. Bob Bell in opting for continuing the District Energy Nodes for another eight months.

This is just perpetuating the mistakes of the previous council.

Hopefully the mayor and a majority of council will be successful to shut this operation down, including the abortive Community Energy Initiative. The evidence is clear that the thermal heating and cooling underground system is too expensive and disruptive to expand without a much larger customer base.

Deputy Chief Administrative Officer Scott Stewart agrees with GMHI CEO Pankaj Sardona that a customer user base of between three million and four million square feet is necessary to make the District Energy project viable.

The fact the previous administration failed to understand this key factor is the root cause of the massive spending on a project that was doomed to failure from the start.

That’s another reason why there is no money to build a new downtown library or South End Recreation Centre.

It also explains why councillors Phil Allt and Mike Salisbury don’t want to look back and hold those responsible. The reputations of Hofland and Wettstein are at stake along with former mayor Karen Farbridge.

Do you think it’s fair to ignore obvious indiscretions by the two councillors who were directly involved for five years serving on the Board of GMHI? Why did they not question the decisions that led to this multi-million dollar failed project?

Not only did they not perform their fiduciary responsibility to the citizens but also they took money to serve on the board.

The only course left for them to salvage what’s left of their professional reputations, is to resign.

It cannot happen soon enough.

 

 

Assessing the financial wreckage left by the Farbridge Community Energy Initiative

By Gerry Barker

July 18, 2016

Tonight, city council will discuss a thorough and damning city staff report detailing the history of the Community Energy Initiative (CEI) that was the heart and soul of the former mayor’s administration.

This was a master plan to develop District Energy Nodes that were linked to an underground network of insulated pipes to deliver hot and cold water to nearby buildings. The Nodes also were designed to generate electricity. These Node sites include the Sleeman Centre where the natural gas-fired pumping system was located; the RiverRun theatre across the street; St. Marks Church located nearby and the two Tricar high-rise condo buildings south of the Sleeman Centre.

The staff report also detailed the operation of the District Energy Node built in the Hanlon Business Park. That only had two customers plus the head office of Fusion Homes. The report said that both the Hanlon and Downtown district energy Nodes cost $8.7 million.

Ms. Farbridge acted as chairperson of a corporation, formed in 2010, known as Guelph Municipal Holdings Inc. Also serving on the board were Councillors Karl Wettstein, Lise Burcher, June Hofland and Todd Dennis. Burcher did not run in 2014 and Dennis and Ms. Farbridge were defeated in the civic election.

That meant that Councillors Hofland and Wettstein served on the GMHI board for five years or more in Wettstein’s case. They were present when the original business plan was developed, yet they never revealed details. They were present when the board meetings were held in closed session for five years, but never said a word about what was happening at GMHI and the Byzantine collection of various companies involved.

Tonight as city councillors, Wettstein and Hofland will be able to vote on the future of the CEI. If they were part of the problem for five years of closed session meetings of GMHI, they should resign or at least recuse themselves from participating in tonight’s meeting.

Oh! What a tangled web we weave

The former mayor did know what was going on and who pushed the failing CEI. She also said little about the role played by GMHI and ultimately Guelph Hydro, plus its subsidiaries, Envida Community Energy Corporation and Guelph Hydro Electric Services Inc

Now Mr. Wettstein says he will not be a candidate for council in 2018. Ms. Hofland tells people that she didn’t understand what was going on.

In 2015, it was reported that GMHI lost $9.4 million. At the same time, Envida owes $11.8 million to GMHI.

Then the staff report says that GMHI does not have the financial capacity to underwrite an expansion of the downtown Node to meet the Combined Heat and Power Standing Offer Program (CHPSOP). To meet that requirement standard, the reports says will cost $29 million.

Are you beginning to believe that this wasn’t such a good idea in the first place? You are not alone.

In the case of the Hanlon District Energy Node, the cost to meet the CHPSOP contract power requirements will be $31 million. That’s a total capital cost of $60 million including the two units already installed, and hooked up to the underground thermal heating and cooling system.

According to the staff report, GMHI has admitted that the two Nodes “will not generate sufficient cash flows over their useful lives to fully recover the costs of installing these assets.” GMHI has already stated it does not have the financial capacity to expand the two Nodes.

Up until this year, the city’s Capital Asset Renewal Reserve (CARR) fund financed the retrofits. Repayment to the reserve will come from cost savings from reduced electricity bills on public buildings with solar panels installed. The repayment is estimated to be completed in ten years. The report did not say how much was taken from the CARR reserve.

Exactly how these power savings will be transferred to the CARR is not explained.

Then there is the item carried on the city books of $68.6 million as an investment in GMHI on our balance sheet. But the so-called investment is already impaired and, over time, this will reduce the value of the investment that will become an expense on the city income statement.

Translation: Citizens could be paying this off over the next 10 to 15 years.

Another wrinkle in this maze of duplicity is the so-called dividends paid to the city by GMHI each year that totaled some $9 million up to 2014. This smells like it was a book entry without actual cash changing hands. If this is true, then it is gross misrepresentation and borders on being criminal.

Now we know why our former Chief Financial Officer, Al Horsman, left the city last August. His successor, General Manager of Finance and city Treasurer, Janice Sheehy, resigned in March after one year on the job. The city finances have been under the supervision of Deputy Chief Administrative Officer, Mark Amorosi for the past 19 months.

This secret scheme is so financially convoluted that we may only get to the bottom of it when the results of an audit are announced in September.

The three options recommended by the consultants and the staff:

In the meantime, this extensive staff report is offering three potential options:

1. Exit Option: Exit the District Energy business and specifically shut down both Nodes.

Number One includes paying off agreements with customers using the heating and cooling system. Price tag is estimated to be more than $10 million to exit agreements with customers connected to the two Nodes.

2. Operate As-is “Stabilize” the current investments in both systems and continue operations under current contractual agreements, without investing significant capital or infrastructure expansion or spending on business development activities.

Number Two is to keep it going until next March and evaluate the outcome of another nine months of losing money. It not hard to figure out that this is the salvage option to save some reputations and bump the mess into the 2018 budget.

3. Preserve opportunity for growth: Continue to operate the current investments within both Nodes and actively assess our position for future investment opportunities.

Number Three represents insanity. We own a system that is losing money at warp speed and it will cost another $59.7 million to fulfill the Farbridge dream.

If you’ve made it this far, you are probably scratching your head over how could this have happened? How could reasonable and experienced people create such a mess and there was no critical comment or explanation for five years?

We now know it happened right under our noses by a small group of people who held absolute power over the city government for nine years.

We may never know the real costs of this failed project, masquerading under the guise of a Community Energy Initiative.

Did you benefit from this? It was a total abuse of the public trust that was a corruptive attempt to inflict a multi-million dollar energy plan on the citizens who had only one recourse every four years: Vote them out of office.

Let’s total up the costs of what is known so far

Cost of installing the Node pumps in the Sleeman Centre and Hanlon Creek Business Park – $8.7 million;

Tax loss costs for GMHI and Envida – $18 million

GMHI loss in 2015 – $9.4 million

Finally there is the $68.6 million investment by GMHI sitting on the city books. The trouble is the investment is impaired because its value declines as servicing the debt costs exceed the value. Over time, the GMHI investment becomes an expense on the City of Guelph’s income statement.

Other charges include $267,000 per year for GMHI Staff. There is a $612,000 break-up fee for contracts with the Independent Electric Service Organization. Add in the cost of consultants including Deloitte.

It appears that the losses so far amount to $37.1 million excluding the $68.6 million listed as an asset on the city financial accounts for GMHI. Also not included are the asset write-downs and write-offs or the so-called $9 million in dividends GMHI alleges it sent to the city.

Annual net income of both Nodes is $123,230. It will take more than 70 years to recoup the $8.7 installation costs. The Hanlon Node is losing $51,193 a year.

The problem lies in the five-year failure of Envida and GMHI to develop a customer base for each Node that would make the District Energy plan and thermal heating and cooling system successful. It was pointed out May 16 by GMHI Chief Executive Officer, Pankaj Sardana, that each Node should have a customer base in buildings of between three and four million square feet in order to meet operating expenses.

In the original business plan of GMHI and Envida it is now apparent that this vital component of the District Energy installations failed to factor in the customer base needed to support the two Nodes.

Here’s what should occur at tonight’s meeting.

The CEI should be scrapped and be reconsidered once the audit of the GMHI operations is completed. The “As-is” District Energy Nodes option proposed by the Deloitte consultants should exist until November 30^th. At that time the two Nodes need to be closed down and mothballed until all agreements and associated costs have been settled. Current estimated liability to exit the District Energy system is $10 million.

It is up to our council representatives to consider the stakeholders who they represent and stop the bleeding of city funds supporting this failed attempt to satisfy the ego of a defeated mayor.

I urge Mayor Guthrie to call a recorded vote on each motion and amendment.

It is anticipated there will be arguments made to keep the CEI on track. The more people who attend the meeting, creates the greater opportunity to end this failed project.

Let’s show up and wrap it up.

 

 

What are the details of the new CAO and DCAO’s pay packages?

By Gerry Barker

July 14, 2016

With the departure of Chief Administrative Officer (CAO), Ann Pappert, questions arise over the details of her replacement and new CAO Derrick Thomson’s replacement as head of operations.

You will recall that when Ms. Pappert informed council of her resignation, Mr. Thomson had already resigned and had taken a job with the Town of Caledon where he is a resident.

Fast forward to within days of Pappert’s resignation; the city announced that Thomson accepted the job offered by, at the time, his former employer. It was the top staff job in the city.

Then, in his new job, he appointed former subordinate, Colleen Clack, to replace him as head of Operations and Guelph Transit.

Ms. Clack earned $142,017 in 2015 as General Manager of Culture, Tourism and Community Investment. So, when is the administration going to tell us her new salary and benefits package as Deputy Chief Administrative Officer (DCAO)? The former occupant of that job was Mr. Thomson whose 2015 salary was $207,554 plus a taxable benefit of $6,472.

Is it just a coincidence that Mr. Thomson and Mr. Amorosi, who do not live in Guelph, each were paid identical taxed benefits of $6,472? Over the space of a year that figure represents a lot of travel and other personal related expenses. Do they submit receipts to claim that taxable benefit?

In this case Corporate Services, DCAO Mark Amorosi, in charge of staff human relations, should explain to citizens the salary and benefits that Ms. Clack will receive in her new position. And please, don’t wait until the release of the 2017 Sunshine List next March to discover her pay package.

Even then, the public won’t learn Ms. Clack’s real salary package because her pay will not reflect a full year as DCAO.

The same problem exists with Mr. Thomson. In June, he inherited the CAO job in which Ms. Pappert was paid $257,248 plus a $6,508 taxable benefit in 2015. Is he now in line to receive a $50,000 increase to match that of his predecessor?

This is another example of the veiled secrecy and lack of moral turpitude practised by senior staff and council in the past nine years.

Mayor Guthrie has stated council must protect the staff from criticism because they cannot defend themselves. That’s what he said in January 2015 when guelphspeaks posted a reference to discussions about Ms. Pappert’s contract being conducted behind closed doors.

He was so angry over the leak from a closed door session, that he attacked me personally by sending an email to an undisclosed number of people to ignore me because, he claimed, I did not get facts right. All he accomplished was to confirm that Ms. Pappert’s contract negotions were underway.

Since then, the mayor has proven to be the one who doesn’t get the facts right. And he has an edge because he presides over those closed sessions frequently conducted by council.

His actions over the past 19 months show him to stay away from controversy, bend to the will of the Bloc of Seven Farbridge supporters and protect his self-image.

Don’t the people who pay the bills top the pecking order of protection in public organizations? Not if you believe the mayor.

Now, he is considering running for a second term in 2018. He had better count on an act of God to make that happen. He has permanently fouled the nest of public opinion.

His Waterloo arrived when he did not disclose the huge senior staff increases for 2015 that were approved in another closed session December 9, 2015. The public was never informed. The only way it was revealed was through the provincially mandated Sun Shine List published last March, more than three months after the council approval.

This was no small mistake. It was a deliberate attempt to cover up a totally unjustifiable increase to senior executives. Mayor Guthrie should have announced the details in open council. Instead he, and members of council, hid behind a Farbridge-inspired procedural bylaw that forced all members of council not to reveal any details of closed sessions.

Having said that, perhaps the mayor can explain why council did not call the Integrity Commissioner to investigate a closed session leak. Coun. Mike Salisbury confessed that he sent details of the January 25 closed session to a “friendly” blogger Adam A. Donaldson, in which five members of the Bloc of Seven walked out in protest.

Apparently that breaking of the bylaw was not worthy of an investigation by the Integrity Commissioner, Robert Swayze.

There are many instances where Mayor Guthrie has failed to act on behalf of the people who elected him.

He has a chance to redeem himself in the upcoming 2017 budget talks by cracking down on spending, rebuilding the tattered reserve funds and call a halt to those closed sessions.

It is so convenient to schmooze behind closed doors, frequently discussing subjects not included in the official reason for the meeting.

Conducting most of the city’s business in private has been going on far to long.

 

 

How the NDP has dominated Guelph’s civic politics for the past ten years

By Gerry Barker

July 11, 2016

This is material you won’t read anywhere else.

It pains me to say this but the majority of Guelph residents either fail to understand how their city administration performs or they don’t care. My task is to make it informative and meaningful to every resident of our city.

This is how a national political party, the New Democratic Party, seized control of the city and imposed its policies and will onto the average citizen.

I have often referred to them as the “orange crush” (OJ) because they have successfully managed to elect their supporters to a council majority creating a ten-year history of political dominance. Not even the 2014 defeat of their leader, Karen Farbridge, plus two councillors and two choosing not to run again, changed their control of council.

By just five votes in ward three that returned June Hofland to council, the OJ retained the majority of votes on council electing seven out of 13 members. This group usually votes as a bloc to perpetuate the failed Farbridge policies that have wasted millions of taxpayer dollars.

Let us count the ways

It started with the 2007 decision to convert the derelict Loretto convent into a new civic museum. The project took more than five years and $16 million to complete the renovation located on the Diocese of Hamilton property of Catholic Hill. Today, the number of people visiting the museum does not cover the operating costs. And the second floor is structurally unsound for major, heavy exhibits.

As a follow-up, the former civic museum on Dublin Street, a heritage building, was sold to a corporation on the promise it would be converted into an artist’s colony for aspiring artists plus graphic and computer developers. Supporting this applicant was James Gordon, the architect of the Farbridge victory in 2006. The building was sold on that promise, despite another offer that council did not accept. Today the dream has been shattered as the owners have converted the space into upscale office suites. The city manager of real estate resigned.

Here’s a further follow-up: The city recently donated $110,000 to Ten Carden Street, a front organization created by the Guelph Civic League, (GCL). That was the key organization that elected Karen Farbridge and ten supporters in 2006 for four years. Who is godfather of GCL? Why it’s current Coun. James Gordon. The grant is supposed to create artist studios on the second floor of the former Akers Furniture Store on MacDonnell Street. Does this have a familiar ring to it? Who owns the building? Does 10 Carden Street have an interest in the property?

The financial train wreck that still needs explanation and the truth

Now, let’s look at the largest single loss of public money in the city’s history called the Community Energy Initiative, (CEI).

This potential train wreck that was initiated by former mayor Karen Farbridge and her supporters, was unanimously approved by city council on April 2007.

There was joy across the city as the newly elected council formed a consortium composed of the city administration, Union Gas, Guelph Hydro, business and industry representatives, University of Guelph, school boards, and the Guelph Chamber of Commerce.

Here are the goals set by the CEI to be fulfilled by 2031:

* Use 50 per cent less energy per capita.

*   Produce 60 per cent less greenhouse gas emissions per capita.

*   Encourage and facilitate community-based renewable and alternative energy            systems.

The staff report in 2007, said that the CEI would position Guelph among the top energy performers in the world. Missing from all this was the business plan to support the claims.

Compounding the potential losses to the city besides the poorly planned energy scheme, was the decision to fire Urbacon Buildings Group Inc in September 2008. The general contractor of the new city hall and conversion of the old city hall into a provincial offences court, sued the city for wrongful dismissal. In 2014, Urbacon settled for $8.96 million.

It was only the tip of the iceberg. While CAO Ann Pappert was telling us before the 2014 civic election, that the settlement would not affect property taxes, the real cost of the completing the city hall project was $23 million more than the original budget, as reported by Ms. Pappert.

Remember, while this was occurring before the 2014 election, then Mayor Farbridge convinced her council in August, just before the capital spending was cut off, to approve spending $34 million to renovate the downtown police headquarters.

The wheels of the CEI’s noble experiment started to come off in 2009 when Guelph Hydro’s subsidiary, Ecotricity Corporation reported a loss of $3,945,000. The report said the loss was due to declining methane gas supply from the Eastview landfill. An impairment charge of $2.984 million was taken that year.

What is the interpretation of an ”impairment” charge? If the recoverable amount of an investment is less than its carrying value, then the asset is deemed to be impaired. The value must be written down to the recoverable amount. Now most people know that the city, by provincial law, must balance its books every year.

But because Ms. Farbridge formed Guelph Municipal Holdings Inc (GMHI) in 2010, as a separate corporation to pursue her dream of energy sustainability and reduction of carbon, the finances went off the city books.

It’s reasonable to assume that with the declining rate of methane gas supply at Eastview generating plant that the recoverable amount is fading fast, thereby increasing the impairment.

Let’s dig a little deeper. The problem occurs when the combined assets of GMHI and the renamed Ecotricity to Envida Energy Corporation, are losing, on average since 2007, $1,967,625 a year. When factoring in the aging of these assets and the CEI enterprise, as organized by the Farbridge administration, the CEI becomes a major league loser. In fact, GMHI lost $9.4 million in 2015.

The accountants like using the term ‘impairment” to describe actual losses of operations as “tax losses.” It’s still a loss by any other name. The argument is that tax losses can be useful to offset future profits and capital gains. In this case it is an actual impossibility. Read on to find out why.

It is calculated that GMHI has an investment impairment of $68.3 million.

GMHI amalgamates with Guelph Hydro

It should be noted that in 2013, GMHI and Guelph Hydro (GHI) were formerly amalgamated. This irrevocably pulled control of Hydro, a corporation with a book value of more than $150 million with a strong monthly cash flow from 55,000 customers, under control of the former mayor and chairperson of GMHI.

The mayor pulled Guelph Hydro into her web of manipulating funding for her CEI agenda.

This was a little-noticed development that gave impetus and funding to pursue the CEI plan to develop two district energy units in the Sleeman Centre and the Hanlon Business Park. These units cost $8.7 million to build. Powered by natural gas, they were linked to the geo-thermal underground water heating and cooling thermal system then under contract. The new plants were also licensed to supply power to the hydro grid, and that has not occurred.

The truth is these CEI operations do not make money and there is never going to be an opportunity to recover the millions that has already been spent.

There were two developments that gave the green light to proceed with the CEI plans. The first, approved May 28, 2012 by city council, was a waiver of sending audited financial statements of GMHI to the city as required under the shareholder’s declaration starting in 2012. But that’s okay, the mayor and four of her councillors were on the GMHI board and could monitor the finances. Surprise! The city council agreed to NOT receive the audited statements.

Now this is what citizens should understand. This is to prevent public knowledge of the GMHI activities and those associated corporations supporting the CEI. And the Farbridge dominated council went along with it.

The second, approved June 28, 2010 by GMHI, was: “The tender process as set out on the city’s Purchasing Policy be waived for energy efficiency and renewable energy generation projects that require access to city-owned lands buildings and rooftops.”

These two developments reinforced the mayor’s determination to prevent any public exposure to what the GMHI was doing. She proceeded with her CEI plans without having to deal with pesky city bylaws that would threaten her plans.

And her counci8l went along with it.

The bottom line is that these two developments broke all the rules of running a business, let alone the city, with no accountability or checks and balances. It remains a deliberate attempt to hide the truth from the public, who are ultimately responsible for the failure of the CEI plans.

In private industry, it would be equivalent to instant dismissal of the managers involved. This CEI was set up to protect those responsible for the planning and execution of this abortive scheme.

In other words, due to a series of operational mistakes that remained unreported, due to the closed-session meetings conducted by GMHI for five years, recovery of this GMHI financing was seriously jeopardized.

To be blunt, this CEI enterprise is a disaster financially with little or no hope of ever becoming remotely viable or an asset of the city. Today, there is no benefit to the public to show for the investment now estimated to be more than $40 million. Now, add in the growing annual “tax losses” of $1,967,245 of GMHI and Guelph Hydro’s subsidiary Envida and you don’t have to be an accountant to figure out this is a growing serious financial disaster. It adds up with debt servicing, tax losses, and write-downs of capital to some $3,268,245 every year.

Citizens now have a debt created by the former mayor, with the complicity of the board of directors of Guelph Hydro, costing even more millions to wind down the non-performing assets.

Any attempt to keep this failed project alive is just pushing more money down the rabbit hole with no guarantees we’ll ever get a refund of Return of Investment (ROI).

Even the current Chief Executive Officer and Chief Financial Officer of GMHI, Pankj Sardana, admits the CEI district energy projects, including the thermal energy connections, were poorly planned, managed and should never have been started in the first place without a sound business plan.

Yet, there are still plans being made to continue this charade of incompetence and wasteful spending.

The two who kept their mouths shut

Two councillors who served on the GMHI board since 2011 supported the architect of this financial disaster, former mayor Farbridge. Coun. June Hofland has been chairperson of the city council’s finance committee since 2010. Why did she not act in the public’s interest, to protest the financial gyrations of this operation? Was she not aware, did she not understand what was going on? She was a member of the GMHI board for four years. She also received a stipend for serving on that board.

The other is Coun. Karl Wettstein who also served on the GMHI board. Just last February 29, Wettstein declared a potential pecuniary interest at the time because he served on the GMHI board. The pecuniary interest he was referring to, was the stipend he received for serving on the board. Again why did he and Hofland not blow the whistle on this situation? Their silence in this matter is deafening.

Just to get this straight. If you receive a stipend for serving on a board, does that mean you don’t have to speak up when the organization is diving into a disastrous depth of debt and operational failure? Apparently it never entered their minds.

And there were other members of council who were part of the GMHI abortive energy project. Former Councilors Todd Dennis and Lies Burcher who were either defeated or chose not to run in 2014. Regardless, they did not raise concerns about the secret of public money flowing out the door to maintain Karen Farbridge’s dream of world recognition.

The sick joke about all this is the some $9 million that GMHI sent to the city treasury through Guelph Hydro over a six-year period. Was it just a book entry on the GMHI balance sheet or did the cash really get transferred? Following the money for that phony claim defies logic. How does a money-losing millions GMHI afford to send an annual dividend of $1,500,000 to the city?

It was all part of the Farbridge plan to make it appear the GMHI was making money, when in fact it was losing millions annually. It also could affect the city’s credit rating that the city needed. Because the GMHI operation was off the books, it did not affect Guelph’s credit rating. It remains all smoke and mirrors.

It’s disturbing how egotism transcends reason particularly when it comes to spending the public’s money.

Most citizens did not benefit from this CEI plan

The citizens of Guelph have been Royally duped by the former Mayor and her followers. Only the people can change it by demanding accountability and transparency.

This was a misguided program that was enjoyed by a tiny minority of the Guelph populace. The CEI plan affected only a concerned a handful of buildings downtown and a similar number of businesses in the Hanlon Business Park.

It’s safe to say that 98 per cent of Guelph’s households and businesses would not benefit from this multi-million excursion into an ego-driven experiment. It is one that has monumentally failed in planning and execution. Now we all must pay for it.

There exists a huge gap in trust by the public of those members of the council’s Group of Seven caucus that continue to support this boondoggle. Instead, they lament the exodus of management staff, excusing it as staff being lured away by more money and better working conditions. They don’t get it.

There has been a gradual disintegration of staff trust in the controlling majority in council. They know how money has been wasted. Former CFO Al Horsman, got it and left to be the CAO of Ste Sault Marie. He left a $209,000 job as a Deputy Chief Administrative Officer (DCAO). You have to ask yourself, why?

Even Ann Pappert took her leave soon after the report she signed with Pankj Sardana May 16, outlining the disastrous history of CEI was made public. Derrick Thomson, resigned his job as DCAO of Operations to be closer to home in Caledon, He was rehired to replace her.

This is the classic case of the chickens coming home to roost. The staff exodus of managerial staff is unprecedented but indicative of the staff malaise that has infected city operations since October 2014.

This should bring a long overdue political enema. Hopefully it is that our mayor and council will return civility, compromise and, give the city back to the people.

The looming crisis in funding city operations in 2017

By Gerry Barker

July 7, 2016

If you haven’t already, you should be receiving a revised assessment of the value of your home for property tax purposes. The Municipal Property Assessment Corporation (MPAC) that adjusts your assessment every four years establishes commercial and residential assessments.

This is the year of adjustment. The notices are determined as of January 1^st, 2016, and reflect how much has changed since January 1, 2012. MPAC assesses 5 million residential and commercial properties in Ontario. To establish the current valuation in terms of assessment, MPAC assembles data on the properties using sales, building permits,, location, living area, age of the property and lot size.

If you are unhappy with the evaluation, you may request /reconsideration. Go to the MPAC website and register aboutmyproperty.ca.

In 2008, former Premier Dalton McGuinty’s government imposed a moratorium of assessment increases for four years. This ended in 2011 and MPAC was instructed to limit increased assessments for four years 2012 to 2015 inclusive.

In case you haven’t noticed, your assessment has been increasing in the past four years. They were not big increases designed to play catch-up from the McGuinty assessment moratorium, invoked during the 2008 global financial crisis.

However, we are now in another four-year cycle of MPAC assessments that will first, impact the city’s 2017 operating budget. The 2016 assessment increase will provide additional funding in planning the budget next November.

But here is where things go off the financial rails.

Last December 9, council, in which there was no public participation, ratified the 2016 budget. A staff recommendation regarding a 10-year, two per cent special tax levy on all properties to pay for infrastructure-rebuilding was tabled in a closed-door session before the public meeting. At the outset of the public meeting, it was immediately moved by council finance chair, June Hofland to push the levy to the 2017 budget. Carried.

Now we have a new Chief Administrative Officer (CAO), Derrick Thomson, who is responsible for approving all staff budget recommendations before sending it to council for approval. His former position as Deputy Chief Administrative Officer (DCAO) of Operations has been assumed by Coleen Clack who used to report to Mr. Thomson as manager of Culture and Tourism.

But the recent sudden death of Rodney Keller, General Manager of Operations, has placed Ms. Clack in an unexpected difficult assignment with the loss of two key top managers in Operations within a few weeks.

The search is on for a new Chief Financial officer (CFO) and the task of integrating the chosen candidate will add to the turmoil that lies ahead when the 2017 budget is being considered. The 2017 budget talks will begin right after Labour Day.

Adding to the task is how to restore reserve funds that have been used to balance five previous city budget variances and the Urbacon lawsuit settlement of $8.96 million.

The greatest task for the administration is cleaning up the Community Energy Initiative (CEI) that has cost, so far, an estimated $40 million. Under management of the city-owned corporation, Guelph Municipal Holdings Inc (GMHI), the operation lost $9.4 million in 2015. There is absolutely no opportunity to continue this disastrous plan because of the future high demand for capital to make the system to even function.

GuelpSpeaks originally published the following April 8, 2015

When looking at other cities’ 2015 property tax increases compared to Guelph, we have the dubious distinction of having the highest rate in the 14-city sample. There are several reasons for this as Guelph council continues to ignore the growth of its staff, in numbers and pay and benefits. The future liabilities associated with these increases will affect future councils for years to come as pensions are indexed to the Consumer Price Index.

To meet these staff obligations will result in Guelph taxpayers facing increased property taxes paying the costs of employees, active and future obligations to those retired. Today, 85 percent of all property taxes received by the city are used to pay staff payroll costs.

The research on this report employed a common benchmark of dollars per $100,000 of assessment. This allowed equalized comparisons with two-tier municipalities such as Kitchener, Waterloo and Cambridge, part of the Regional Municipality of Waterloo.

The report was researched from official public sources.

Here is the list in descending order:

City                                    2015 tax increase              Ranking             Difference

Guelph Budget                             3.55%                                    39

Guelph revised                             3.96%                                    44

Hamilton                                       2.70%                                    35                      Minus 1.26 %

London                                          2.50%                                    30                      Minus 1.46 %

Brampton                                      2.54%                                   24                       Minus 1.42 %

Brantford                                      1.88%                                    22                      Minus 2.08 %

Port Colborne                              1.10%                                    18                       Minus 2.86 %

Burlington                                    2.06%                                   18                       Minus 1.90 %

Oakville                                        1.70%                                    15                        Minus 2.26 %

Mississauga                                 2.20%                                   12                        Minus 1.76 %

Cambridge                                   2.72%                                   10                        Minus 1.25 %

Toronto                                        3.20%                                  10                         Minus .76 %

Waterloo                                      1.53%                                     7                         Minus 2.43 %

Kitchener                                      1.9%                                     7                          Minus 2.06 %

Windsor                                        0%                                        0                         Minus 3.96 %

Consumer Price Index 2014   2.1%

Comparing the Guelph revised rate of 3.96 per cent to the next highest on the list, Hamilton, at 2.70 per cent, the difference is an astounding 31.8 per cent!

Back to today

This is why more research has revealed that Kitchener’s and Cambridge’s operational and capital costs are 50 per cent lower than the City of Guelph.

This reflects the undue influence of a rump majority of council who slavishly follow the policies of the previous administration led by former mayor Karen Farbridge.

These policies and special self-serving rules of governance, have led to unacceptable high property taxes and user fees, special deals with developers granting tax relief and delayed payment of development fees.

The bleeding of the public purse will continue until there is real reform of spending.

It’s reflected in one factor: In five years, the administration has failed to meet the budget creating multi-million dollar negative variances.

Think about that. Can you run your life and personal finances by failing to meet your budgets? The difference is the city administration dips into its reserves to balance its books annually as required by provincial law,

Now the reserves have been steadily drained with little replenishment.

I don’t know about you, but I didn’t vote for this.

 

 

 

 

 

If Milton can decrease the size of its council from 11 to 9, why can’t Guelph?

By Gerry Barker

July 4, 2016

Recently, the town of Milton’s 11-member council voted to reduce the number of elected councillors to nine. It will reduce the number of wards to four and will adjust the boundaries.

According to Mayor Gordon Kranz, the process took a little more than an hour and the vote was six to five in favour of the reduction to be effective in the 2018 civic election.

The differences between the two municipalities are marked by Milton’s aggressive attraction of industrial and commercial assessment that leaves Guelph biting their dust.

Guelph’s industrial/commercial assessment is 16 per cent of the city’s total assessment. Residential assessment is 84 per cent. It has been stuck in that ratio for the past ten years.

The provincial average of industrial/commercial assessment is 40 per cent and 60 per cent residential. Guelph is not even close to that provincial average. This is one of the chief reasons that residential taxes are among the highest in the province

You can only blame the policies of the previous administration that failed to attract and sell the city on locating to the Royal City. The former Farbridge administration focused instead on a narrow schedule of environmental issues, such as the organic waste composting facility; the automated waste collection system requiring the use of bins of presorted garbage; reducing the traffic lanes on major roads to accommodate bicycle lanes. To accomplish their goals the former administration increased the full-time staff from 1,400 in 2007 to more than 2,145 this year.

Guelph has 13 councillors including the mayor. Its reliance on property taxes of the greater majority of residential properties has not only driven up taxes and user fees but also its policies of attracting and approving industry have failed miserably.

It’s no wonder the city is not attracting industry because the costs of operating in Guelph are not competitive with other municipalities in the Wellington/Halton/ Waterloo catchment area.

This performance is one of the main reasons that neighbouring Cambridge and Kitchener have operating and capital costs that are 50 per cent less than Guelph’s.

You may recall the 11-year battle to have Wal-Mart come to Guelph. Some of the same people on city council today worked hard to make sure the world’s largest retailer would never set up shop in Guelph.

The anti-Wal-Mart campaign was funded by the various labour unions, the cost of which was never known but the city spent more than a million dollars to oppose the union involvement. It became know as the anti-Big Box stores wars.

With a city staff that is 80 per cent unionized, the influences exercised by this collective hampers industrial development. In the case of Linamar, the city’s largest private employer, more than half of its workforce lives outside Guelph. Why? You may ask, it is because the cost of owning property and living in Guelph is much higher than either Cambridge or Kitchener?

This did not happen overnight. The hardcore majority of the environmentally element on three successive councils enacted polices such as attempting to reduce carbon emissions by trying to force citizens to get out of their cars and pedal.

Today, James Gordon, Leanne Piper, Cathy Downer, Phil Allt, June Hofland, Mike Salisbury and Karl Wettstein are the majority of city council and most times vote as one bloc.

This group is responsible for the anti-business attitude that pervades the staff.

The only way to change it is to defeat them in 2018 on the grounds of their obstructionism and collective tactics that only serve their loyalists, union members and hangers–on.

Putting council on a reduction diet has about as much chance as a Mandarin meatball heading down the pie-hole.

The present ward system suits the Group of Geven just fine because it’s easier to fund, run and win a ward seat on council rather than across the city.

If we are to create change and aggressively attract quality industry, the ward system needs to go, among reforms of governance created by the previous administration.

Here’s a heads-up on reforming the first past-the-post election of candidates. There is a group in town actively trying to have the city adopt proportional voting, an NDP platform policy.

And all this time you believed getting rid of former mayor Farbridge would bring reform, lower taxes and a council that would work for the common good, not their own personal agenda.