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|
|Social and family services||43,601||52,280||51,183||-7,582||-14.8%|
|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%|
|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 email@example.com or guelphspeaks.ca