Why Guelph’s bureaucratic costs are crippling our city, because staff won’t listen

By Gerry Barker

September 12, 2016

On August 22, My wife and I sent an open letter to the Hon. Bill Mauro, Minister of Municipal Affairs. In the letter, the details of mismanagement of our city were outlined and we asked a reply to our request for an investigation of city operations.

That was three weeks ago and we are still waiting.

Premier Kathleen Wynne appointed Mr. Mauro in her recent cabinet shake-up. He has experience on this file as he served in the job before. Our MPP Liz Sandals was moved in that shake-up from Minister of Education to President of the Provincial Treasury Board, a less onerous cabinet job with little or no public exposure or consequence. That’s the equivalent of a “D” in politics.

Meanwhile Deputy Chief Administrative Officer (DCAO) Mark Amorosi disagreed with his new boss, Chief Administrative Officer (CAO), Derrick Thomson, about the state of city finances. His statement claiming the city was in “sound financial condition” contrasted with the CAO’s statement that the nine-year capital expense plan was underfunded by $170 million after just one year in operation.

Believing today that this city can afford a new Downtown Library, South End recreation Centre, the Wilson Street parking garage and redevelopment of the Baker Street parking lot, is pixie dust and impossible.

It is now open and transparent about how public money has been wasted by a staff in concert with council in the past nine years.

It is not Mayor Cam Guthrie’s fault. He, unknowingly in taking office December 1, 2014, inherited a financial cesspool of millions spent and wasted on self-serving policies of the previous Farbridge administration. You remember them and all their self-promoted awards. To read a recent column written by one of her supporters, the writer painted her as Saint Karen, the revered leader of Guelph. Yikes! Is there no limit to their arrogance?

The problem today is the rigid control of council. They regularly support the senior staff that has seen a CAO and DCAO leave the city because of the revelations of mismanagement.

In his fine analysis of the bloated city operational costs, Pat Fung, CPA, CA, outlined why the city’s operating costs were growing at an unsustainable rate that lasted seven years.

Here is a telling chart of Pat Fung’s analysis

Guelph’s Operating Costs 2008 to 2015 (source: Audited financial statements)

($ thousands) 2015 2014 2008   $ ’08 to ’15 per cent
           
General government 27,070 25,136 18,891   8,179 +43.3%
Protection services 79,550 75,506 51,855   27,695 +53.4%
Transportation services 60,381 57,405 43,380   17,001 +39.2%
Environmental services 76,238 72,697 35,035   41,203 +117.6%
Health services 29,180 27,522 18,524   10,656 +57.5%
Social and family services 43,601 52,280 51,183   -7,582 -14.8%
Social housing 21,372 20,444 n/a   21,372  
Recreation and cultural services 40,906 39,481 23,947   16,959 +70.8%
Planning and development 7,313 6,155 3,986   3,327 +83.5%
           
Total Expenses 385,611 376,626 246,801   138,810 +56.2%
Consumer Price Index 126.6 125.2 114.1   12.5 +11.0%

Guelph should reduce its operating expenses by $20 million and freeze taxes and fees at current levels to fund the capital/infrastructure gap. We cannot continue to increase spending on operating costs on top of increasing our spending on capital and infrastructure.

The Fung Solution: It can be done by freezing revenues at 2016 levels and reducing expenses by $20 million annually. It can be accompkised by freezing expenses at $365 million for 20 years, allowing for increases for index of inflation and assessment growth. City reserves would be built up to $200 million in 10 years. This would be reduced by whatever is spent in the interim on capital and infrastructure. This has the same financial effect as increasing taxes but is funded totally from within the current taxation, user fees and spending.

Will Guelph do the right thing and reduce staff and operating costs?

Guelph’s current financial situation is close to what the City of Brampton faced last week when it terminated 25 senior managers. Mr. Fung pulls no punches in his analysis saying in order to reduce operational expenses, the city will have to lay off staff, reduce salaries and reduce management personnel. According to the provincial Sunshine List there are 92 city staff positions with the title “ manager.” That’s one for every 22 full-time equivalent employees

Regardless, the new CAO is quoted as saying that: “One option the staff will not present to council this fall as a solution to its capital funding woes is drastic cutting of services.”

That’s the usual claptrap excuse that has enveloped thinking of both city staff and leftist members of council.

Mercy me. We can’t cut services as the runaway train of financial mismanagement plunges off the cliff? Thomson disregards the Mayor’s request to investigate funding alternatives other than another property tax increase.

With that thinking by the CAO, who heads the 2,100 member of staff, get ready for a recommendation by staff to approve a 2 per cent special levy of property taxes for more than five years. Or, perhaps a longer period. It remains a sloppy and quick fix to the deep financial problems existent today and are not hoing away. It’s just another way to extract more money from the property taxpayer.

Do these deep thinkers on staff not understand why Guelph’s operating costs on a per person basis in six active operational areas, far exceed the average of the rest of the municipalities in Ontario?

According to the independent BMA consultant report, every person in the city pays $836 for the operational costs of six defined areas. The average in Ontario is $586 per person. That’s a 42.66 per cent difference, or total excess spending by Guelph of $30 million per year.

Now let’s take the General Government’s cost comparison. Guelph spends $229 per person in this category. The Ontario average cost per person is $104. The difference is a whopping 120 per cent additional cost to every resident of the city. Further, General Government expense is not a service but overhead. It can be reduced to meet needed cost cutting measures to bring the city government costs in line with what most Ontario municipalities are currently paying, based on a per capita population.

Now current acting CFO, DCAO, Mark Amorosi, doesn’t like to talk about this per captia cost. He says it’s irrelevant. What doe he care? He lives in Hamilton.

The present senior staff management and the Bloc of Seven on council, show no signs of acknowledging the growing financial problems being foisted on the taxpayers year after year. Plainly the staff is bloated with too many managers, high salaries and benefits, plus in some cases, two high priced managers doing one job.

Mark Amorosi’s crowning triumph was getting council, in closed session, to approve a 17.11 per cent increase for his then boss Ann Pappert and his three DCAO colleagues between 14 and nine per cent increases for 2015.

The public found out about it in March this year when the provincial Sunshine List of every public employee in Ontario earning more than $100,000 is named with taxable benefits five months after the fact.

Mark Amortosi was in charge of the city finances and Human Resources when council approved those increases December 9, 2015. Why is this man still working for the City of Guelph?

We urge folks to read the complete Fung Report. It can be found in the guelphspeaks.ca archives – Part One was posted August 29, 2016 and Part Two was posted September 1, 2016. If unable to locate the report, please contact Pat at pat.fung@sympatico.ca or guelphspeaks.ca

 

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11 Comments

Filed under Between the Lines

11 responses to “Why Guelph’s bureaucratic costs are crippling our city, because staff won’t listen

  1. Glen

    The refusal to have staff “suggest” personnel cuts is all too typical of those who view their positions as entitlements to a job for life rather than to provide cost effective services to taxpayers. The attitude of the CAO, DCAO’s, & various senior manager seems to be “I’m alright Jack”. Too bad our new CAO is not an “agent of change” like the new one in Brampton. We can only be green with envy of Brampton councillors and taxpayers.

  2. Capricorn

    I gather from this article, that staff have not responded to Mr. Fung, even through council. I realize that they don’t report to him, but, it would be a courtesy for them to address his letter. It’s ironic that we have such a well-staffed communications department, yet they don’t always communicate.

  3. To quote you “Is there no limit to their arrogance?” Remarkable how people can be so opinionated and so arrogant. That’s what this column is all about. If none of you see the arrogance that drips from this column then Guelph is the loser. Political debate should be civil and this column and the accompanying discussions will certainly bring it to a new low. Well done!

    • guelphspeaks reader

      Well, randomness4all, you are clearly speaking on behalf of those who are criticized here. Equating factual and documented information with arrogance, is rather arrogant in itself, wouldn’t you say? I have seen arrogance from those who are criticized here that is not only appalling, it comes at taxpayers expense. Examples abound of low behaviour, closed-door abuse of power, and strict message control. Citizens have every right to disseminate information however they choose. Suggesting there is something wrong with that is not only really problematic, it’s undemocratic.

    • guelphspeaks reader: Good response. It’s just another troll supporting a losing cause and attempting to defend the indefensible.

  4. And there’s the arrogance. Making sure that anyone who speaks against the the “Guelph Whiner Speaks” is labelled a troll. At least Guelphspeaks reader engages and for that I have respect.
    I voted against the Vampire Mayor. I hated her last term in office but I would shake her hand and thank her for her service as I shook Kate Quarrie’s and Joe Clark’s hand and thanked them for their service. The author of this blog seems incapable of showing respect for people who, at least, run for civic office or those who criticize his “man bites dog journalism”. A skilled writer, he has the ability to twist words and inflame any situation. Please just put a stake through the vampire and move on to describe a positive platform for Guelph.
    In camera meetings are universally used to discuss personal matters. There use is not the problem. How they are manipulated is the concern.
    Run for office!

  5. guelphspeaks reader

    I think to single out Guelph Speaks as a manipulator, while giving respect to the former mayor for her “service” is pretty rich.
    Is it not the role of journalism or writing itself, to give us information and facts not accessible through “official communications channels”. Like the gigantic City Hall communications department, where message control is the mantra. Like the Toronto Star-owned Mercury-Tribune, who receives a good chunk of advertising revenue from the City, and is a corporate subsidiary of a paper that published glowing articles about Karen Farbridge. The current Mercury-Tribune scant coverage of City Hall issues makes one wonder if James Gordon, or even Farbridge herself, has been made head of editorial decisionmaking. The other local media outlet is not much more than a bulletin board for press releases, including those generated by the aforementioned bloated message control of very well-paid City Hall Communications Experts.
    Where is the public to find what is really happening in City Operations?
    That is supposed to be the role of journalists.
    But paid journalists in Guelph are little more than ambulance-chasers and regurgitators of press releases. As taxpayers face having to pay and pay for the irresponsible, reckless, secret agendas of politicians, it is unreasonable to suggest, as all who have something to hide do too, that we just “move on”. These people continue to hold office with impunity, and many will run again.
    Without information found only on this blog, the people are ill-equipped to make an informed decision on who is best to put in positions of power.
    People have a right to make choice. I choose to read this blog; I have yet to see any egregious factual errors, and what I do see is concern over the future, not just the past.
    If the agenda of those who currently hold the balance of power in Guelph continues, I fear for the next generation, and for those who are ageing in homes they will not be able to afford because of the tax demands of paying for the folly of ideological agendas carried out at public expense, without practical plans.
    It bothers me a lot when people put down this blog, which is probably the most valuable media resource in this city, and the one that is most concerned for its future.

  6. Randy Norris: Thanks for your point of view. Please do not clutter up the blog with your personal attacks on me.

  7. guelphspeaks reader

    Wow…attributing the low level of openness and maturity in Guelph politics entirely to this blog? Strikes me you have a personal ax you’ve decided to grind publicly because whatever role you wanted here didn’t pan out. Have you tried Guelph Politico? He might take you, if you want to publish your writing that much. Or maybe you could start a blog of your own, and set a better example than here? You thanked me for the debate but we have not debated. I’m just a conduit for you to rant on Gerry. I feel a little too much like his personal champion when I’m not. Don’t like his writing? Don’t like Pat Fung’s exhaustive research tabulation? Don’t read it.

  8. Graeme Hedley

    It is council’s job to oversee all expenditures, including staff. If council is not prepared to do its job and only to be yesmen for staff, then the only solution is the Brampton solution.
    Guelph Senior

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