Property taxes too high now, here’s why City council will drive them even higher

By Gerry Barker

August 30. 2018

It has always been a mystery to me why the City of Guelph has stifled real economic growth across all assessment levels as compared to similar and neighbouring municipalities.

A friend sent me a detailed study of the average cost of homes in 25 Canadian cities and a deeper illustration of the average home values and property tax rates in the Greater Toronto Area.

In the Canadian study by Zoocasa, a reputable company that analyzed real estate values and property tax rates across the country, I should emphasize that the following data is sourced directly from each municipality’s official websites.

Let’s compare Guelph’s tax data with a number of municipalities in Ontario and Canada.

As of June 2018, the average home price of Guelph is $436,600. The property tax rate is 1,17125. Of the 25 Canadian municipalities in the study, Guelph was rated as number 20

Here are comparisons contained in the Canadian study:

Municipality       Cdn     home value       tax rate      (less than Guelph)

Kitchener               19               $489,607-            1.12975            (.0415%)

Waterloo               16               $489,607             1,10785            (.0634%)

Guelph, Kitchener and Waterloo all have major universities and community colleges

In the GTA study here are other comparative property tax rates and home values:

Municipality            GTA       home value    tax rate          (less than Guelph)

Barrie                           20              $479,579            1.0000             (.1725%)

Caledon                       16              $874,690            .84010               (.330115)

Milton                        5                 $701,595            .69790                 (.47335%)

Oakville                       9                $1,074230           .75280              (.41845%)

The growing hidden costs boosting property taxes in Guelph

Before discussing in detail, there are four major elements determining how much you pay to own property in Guelph:

* The tax rate

* Assessment

* User fees

* Manipulation of expenses by city council

Prior to each budget, council sets the property tax rate based on the anticipated revenues and expenses produced by the professional staff. Funny thing is that the rate never goes down.

Each property is assessed by the independent Municipal Property Assessment Corporation. Any increase, coupled with the tax rate determines the basic tax bill.

User fees are optional charges for using public assets and properties. Examples include Guelph Transit, rinks, recreation centres, libraries, civic museum, swimming pools, various park events, city waste facility etc. But not use of bicycle lanes and paths

In Guelph, city council offsets essential water treatment and storm sewer costs to be collected separately in your hydro bill. In our case, that’s another $600 a year not included in our tax bill. Also include the 2 per cent property tax levy that is buried in your tax bill.

*            *            *            *

The exodus from Toronto’s high cost home prices of young families to seek lower cost homes has caused higher home prices in some, but not all, surrounding cities and towns. Those seeking lower housing costs should understand that not all municipalities are equal when it comes to paying property taxes and user fees. Also to be considered is the track record of potential municipalities in terms of the growth of property tax rates and appreciation of home values over time.

Out of the 25 major Canadian cities studied by Zoocasa, Vancouver ranks the best for property taxes with the lowest rate of 0.24683 per cent; that’s less than half the rate of the next highest city, Abbotsford, BC that has a rate 0.51300 per cent. In fact, the best cities with the lowest property tax rates were generally found in BC, with Victoria at 0.52035 per cent and Kelowna at 0.52605 per cent.

However, living in a region with a low tax rate doesn’t necessarily translate to less tax paid if average home prices are higher. For example, the Toronto tax rate is 0.63551 per cent, which translates into $5,532 of property taxes based on the average June 2018 home value of $870,559. In comparison, the Edmonton tax rate is 0.86869 per cent or about 1.4 times that of Toronto’s, but the average home value in Edmonton is substantially lower at $381,520, which would result in a lower amount of property taxes overall of $3,314.

This is not the case in Guelph where an increase in new property development will drive city property taxes much higher.

This illustrates the property tax and user problems facing Guelph. Already we have a high tax rate of 1.17125 per cent and an average home price of $436,600, any increase in home prices in Guelph will result in higher taxes for all existing property owners. It’s because of the existing high property tax rate accompanied by surging home values.

There is also a large range in property rates for Ontario cities: London’s rate of 1.35082 per cent is more than double Toronto’s rate while Ottawa’s rate of 1.06841 per cent is 1.6 times that of Toronto.

All property tax rates were sourced from municipal websites.

The last three Guelph administrations have propelled a property tax rate crisis. Guelph resident Pat Fung, a chartered accountant, two years ago, sounded the alarm by analyzing the financial data as published by neighbouring municipalities.

The result revealed that Guelph’s operating overhead far exceeded that of Cambridge and Kitchener. His detailed report was presented to city council that ignored the details. The weekly newspaper turned down publishing the report and also a paid ad to explain the details.

The current Mayor campaigned in 2014 how he was gong to reduce property taxes to the level of the Consumer Price Index that was 1.55 per cent. In his first budget the city council voted to increase property taxes that eventually were 3.96 per cent.

Since 2007, city council has increased property taxes annually by, on average, more than 3 per cent.

While other municipalities were more prudent in delivering economic development, such as industrial and commercial assessed clients, Guelph’s leadership proceeded to focus on ill-planned and executed environmental and energy projects. This was accomplished at the expense of major capital expenditures such as the downtown library and much needed infrastructure repairs and maintenance. It has resulted in few benefits to all citizens and at a terrible waste of public funds.

The majority members of council have perpetuated these annual property tax increases. Now we discover the proof of the disastrous decisions that have been made and the lack of major financial planning and execution.

This is the most important election the city faces next October. In my opinion, there are seven members of council who should be replaced, chiefly based on the dereliction of duty to fairly represent the people who elected them.

What further information is necessary to come to this conclusion? Guelph is a high-taxed city that is ripe for a high level of residential development

But the Toronto Star ignored Guelph in its analysis of the growth of communities outside the GTA as buyers look for more affordable homes.

The real concern is the property tax rate that will impact the residents who already live here. They are already paying a two per cent levy on top of their regular tax bill to finance those neglected capital projects mentioned above.

Choose carefully citizens. Change must come to the management of our city. This is the only chance we have to elect a new council to make it happen.

 

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The passing of logic and understanding

By Gerry Barker

August 27, 2018

On Saturday a great American statesman, Navy pilot and patriot, died.

John McCain was 81 years old and loved to be called the “Maverick.” His historic “no” vote to stop the total dismantling of Obama Care in the U.S. senate, ended the attempt by his fellow senators to finish the job.

Maverick indeed.

This week in Guelph Today, there was an opinion piece written by local blogger Adam Donaldson in which he described the Association of Municipalities of Ontario (AMO) annual meeting as “ much AMO about nothing” – cute. So its no wonder that one cannot take Mr. Donaldson seriously.

He said he interviewed Mayor Guthrie who was enthusiastic about the AMO meeting stating: “They (the provincial government), have been very welcoming, very open to hearing what’s going on in Guelph.”

The piece later on quoted Premier Doug Ford telling the AMO delegates that the government had no plans to further emulate the Toronto Council reduction (Bill 5). It would reduce it from 47 members to 25 matching the provincial and federal riding boundaries in the city.

Is Donaldson still smarting over the total defeat of the Wynne government and its policies by the Ford Tories? Guess he’s not been around to recognize the political reality of removal as the party that was in power for several years. .

Good grief! The Liberals were in charge of this province for 15 years. The Ford Tories have held the reins of power for less than three months.

But the Liberal media including my former paper, The Toronto Star, are doing a character assassination number on Mr. Ford while his cabinet members are still trying to find their offices.

The Guelph Today Ford wrecking ball commentary asks the question: How long will the Ford government treat the AMO with ‘gusto’ and how long will it last?

That will be four years.

The Wynne government used the AMO to reinforce its wacko energy plans that have driven the cost of electricity in Ontario to one of the highest in North America. That’s because the AMO is funded and supported by the party in power. A creature of the province, one may surmise, like the 444 municipalities in Ontario.

It’s one way for the party in power to control and manipulate the operations of its 444 supplicants. It’s also a convenient instrument to keep all those municipal councils in line with the implied threat of denying grants, favours and support.

There is nothing equal about all this. It’s done our way or our cooperation will disappear.

The election of Green Party candidate Mike Schreiner as our representative to the Ontario Legislature has isolated the city from provincial support initially. Schreiner is a party of one with no recognition as an official party in the Legislature.

His effectiveness under this situation handicaps his obligation to ensure the city is able to access the support of the various provincial departments now dominated by the PC’s.

Recently, there was a story published in the Toronto Star describing the movement of young families from Toronto due to the high cost of housing. The story mentioned destinations including Barrie, Kitchener, Cambridge, London and Kingston. There was no mention of Guelph.

Why was that? With respect, there are several factors. The first is that Guelph’s residential property taxes are among the highest in the province. The city is home to the University of Guelph that currently has a reported 22,000 students.

While there is great pride in the University, there exist huge costs to most citizens to subsidize the university such as infrastructure of utilities roads, transit, medical facilities, street maintenance including snow and leaf removal,

The burden of these and many other services falls on the property taxpayer of the city of Guelph. The University is the largest landowner in the city. Provincial legislation in 1987 decreed that in lieu of property taxes, the universities and colleges in Ontario would pay $75 for every full-time student attending for two semesters.

This arrangement has not changed in 31 years. Compared to citywide assessment of properties in that same period, using a base of the Consumer Price Index for inflation, the increases to city property owners is almost incalculable.

In 15 years, did the provincial Liberals ever consider fixing this unfair and costly archaic system?

By banging the drum to complain about the Ford leadership, look inwardly Guelph because the governance of our city in the past 12 years has neglected the basic fiduciary responsibility of the elected and senior management.

There are three major events that have cost residents dearly. First the $23 million additional cost of building the new city hall; then came the Guelph Municipal Holdings Inc. cover-up that so far, has resulted in a major write down of Guelph Hydro’s tangible assets plus a loss of $17 million in 2016. The third project, linked to the GMHI debacle, is the merger of Guelph Hydro with Alectra Inc.

You cannot walk away from these mismanaged projects and then announce a potential $350 million renovation of the Baker Street parking lot involving a partnership with an Ottawa company to commence construction in 2024.

Guthrie gushed that the prime tenant would be the new downtown library.

I am not against this proposal but question what is the taxpayer’s commitment to this project?

Oh! I forgot this is election time.

Meanwhile, the demolition of the Wynne government’s social engineering policies will continue because most voters rejected them by electing Doug Ford and 75 members to the Ontario Legislature.

 

 

Swimming upstream against a tsunami of incompetence

By Gerry Barker

August 23, 2018

More than two years ago, I asked the Ontario Ombudsman office to assist me in obtaining the minutes of a city council closed-session meeting conducted December 10,2015. That meeting approved salary and bonus increases to the four senior staff managers that totaled $98,202.

At the time of the request, only council and some staffers knew what those increases were and why was there no explanation?

The Ombudsman representative told me that that office could not assist because “Guelph had its own special investigator of closed session meetings” … Amberlea Gravel located in London. This organization was hired by the city in 2008 and had been on retainer for the past ten years.

I filed a request for the minutes through the city clerk’s office. It took more than four months to be told that my request was denied. By that time, the increases had been revealed when the 2015 Sunshine list was published in March 2016.

To this day, the city administration has never explained why it withheld that information for almost four months and has yet to acknowledge it.

The cover-up was controlled behind closed doors.

It got me thinking this year about the methods used by the current Guthrie administration to suppress public participation in the business of the city.

So I checked with the city clerk and requested how many closed-session meetings were held since January 2015 to a couple of months ago.

I was informed that in 2015 and 2016 there were 41 such meetings held in each year. That’s 82 over 24 months. That number dropped in 2017 when the council voted to conduct its business acting as the ‘committee of the whole.’ Last year there were 12 closed-session meetings with a similar number this year to date.

Why does this matter?

It is a slippery slope that allows city council and senior staff to virtually, make decisions in secret, without public input or knowledge. It results in pre-digesting the contentious items of business without telling anyone.

That’s how the Farbridge administration wasted millions on the Guelph Municipal Holdings Inc (GMHI) by imposing silence for four years using closed-session meetings.

To prevent leaks of the details of those closed-sessions, the hammer over the councillors was the threat of the Integrity Commissioner investigating the alleged misconduct and potential penalties.

The scope of this GMHI ‘green’ adventure was to create power self-suffiency and potential heating and cooling of downtown building and the Hanlon Business Park.

It was finally exposed following the defeat of the former mayor in 2014. It took until May 2016 before the awful truth was revealed. Ironically, the report was presented by GMHI CFO Pankaj Sardana and signed by Chief Administrative Officer (at the time) Ann Pappert. Ms. Pappert was appointed Chief Executive Officer of GMHI in 2011. So, she was wearing two executive hats and had to have intimate knowledge of the city and GMHI operations for four years.

But it gets better, or worse as the case may be. The former mayor was chairperson of the GMHI Board of Directors. Because of her position as mayor and head of GMHI that included Guelph Hydro, she named four members of council to the GMHI Board.

These included Councillors June Hofland who was also head of the council finance committee, Karl Wettstein, Lise Burcher and Todd Dennis. This gave Ms.Farbridge complete control of both the city and GMHI.

The disturbing situation some four years later, is that the financial mess is still to be cleaned up as contracts and operation of the District Energy pumps are still operating to supply hot and cold water to five buildings downtown, including the Sleeman Centre and River-Run theatre across the street.

Best estimate of the cost of wrap-up will require $17 million and counting. The bottom line is there remains insufficient revenue to continue operating GMHI but the problem has yet to be resolved. The purchase of GMHI shares by Alectra may solve the situation. According to the merger agreement, the proposed Alectra Inc. dividend will be paid to GMHI, not the city.

The Guthrie administration has promoted the sale of GMHI shares, which are worthless, to Alectra Inc as part of a merger agreement. The data shows that the owner of Guelph Hydro ‘s tangible assets including poles, wires, substations, and equipment is the subsidiary corporation Guelph Hydro Electric Services Inc.

And who owns GHESI? Why it’s GMHI. That’s why Alectra is ‘purchasing the shares of GMHI.

How did we get into this pickle?

Because as citizens we were denied important information and details including a supportive business plan that made sense, not chaos.

It was a carefully orchestrated scheme that was under the control of a city council, of which most members were bereft of skills, financial acumen and conscience.

So what does the Guthrie council do? They approve entering an agreement with a private corporation to redevelop the Baker Street parking lot into a spiffy downtown showcase of mixed use including a new library, businesses, shops and residences.

The estimated cost of this grand design is unknown. One estimate said between $314 and $350 million. This proposal won’t start until 2024. Citizens have no information about the city’s share of the development. And it won’t be ready for occupancy until at least 2028.

When is this stream of building abortive monuments going to stop? There is plenty of blame to go around. But until we elect responsible and experienced councillors we will continue swimming in a sea of uncontrollable, ego-driven waste of resources.

 

 

 

 

Setting the record straight on the Guelph Hydro/Alectra merger

By Gerry Barker

August 20, 2018

Some days are better than others.

This past week I had the opportunity to spend time with a professional accountant who was familiar with much of the details of the proposed merger between Guelph Hydro and Alectra Inc.

Right off, this was a complex agreement containing many parts that was conducted in such a manner that defied understanding, especially to me who had to rely on city statements, devoid of the details.

As it turned out, I wasn’t the only one who didn’t get it right and for that I apologize to my viewers.

My advisor walked me through the maze of financial manipulation of city-owned Guelph Hydro Inc (GHI) and Guelph Municipal Holdings Inc (GMHI) conducted by the former Mayor, Karen Farbridge.

It turned out to be an epic misadventure of the use of public funds over a time frame from 2011 to 2014 when she was defeated. She was joined by four of her supporting councillors, June Hofland, Karl Wettstein, Lise Burcher and Todd Dennis to serve on her GMHI Board of Directors. Chief Administrative Officer Ann Pappert was appointed Chief Executive Officer of GMHI in 2011.

Without going into the convoluted explanation here is a recap.

It started in 2011 with GMHI commencing its control of the following players: Guelph Hydro Inc, Guelph Hydro Electric Systems Inc (GHESI), and Envida Community Energy Inc.

Explanation: While the city-owned GMHI and its assets, the leadership was the same, Mayor Farbridge and CAO Ann Pappert. Supporting this arrangement were councillors friendly to the mayor and her agenda.

The key to fulfill the agenda of GMHI were the profits of GHESI, owners of the tangible assets, including the poles, wires, substations, service equipment and cash to serve the 55,000 customers. The 2016 GSI financial statement put the value of these assets at $228 million.

During these four years, the GMHI operated almost entirely in closed-sessions, defying the public its right to understand what was going on.

So, what was going on?

Guelph Hydro Inc, the parent company of these assets and liabilities, was brought into the GMHI Corporation. This was done to strengthen the financial viability of GMHI that was not earning sufficient income to support its agenda and pay the operating costs.

The profits of GHESI allowed it to pay a dividend to GMHI who only paid a portion of these dividends to the city. This development provided GMHI with only one source of financing.

Following the result of the 2014 election, Mayor Cam Guthrie assumed chair of GMHI along with Coun. Karl Wettstein. It was reported that in 2014 GMHI had lost some $3.5 million.

In the middle of this was Envida Community Energy Inc., a GHESI subsidiary that was operating the District Energy pumps in the Sleeman Centre and Hanlon Business Park plus other projects. In May 16, 2016, the CEO of GMHI, Pankaj Sardana, reported to council that the Envida assets were impaired and should be written down. Further impairment occurred the following year.

In 2017 it was reported that Envida had lost $17 million on district energy. The district energy assets were worthless. This in itself was a growing cash liability that needed to be addressed.

During 2016, the city appointed a Strategies and Options Committee (SOC) to examine the options available to move forward with GHESI. Council removed the option to sell GHESI at an open meeting.

My accountant showed that the GHESI had total assets of $228 million and liabilities of $159 million in 2016, not as how I had described it. GHESI’s value for the merger that was $129.4 million. While I speculated the proposed merger was a $300 million giveaway, it appears, based on the evidence now obtained that the merger value is is in exchange for a 4.63 per cent of Alectra Inc.

The merger agreement consists of a special dividend to the city of $18.5 million. While I believe that it is being paid with our own money, I now believe it is a righteous adjustment to clear up the financial morass created by the former mayor and her GMHI board of directors.

So what does the city get in return for agreeing to this merger? I have been informed that there will be a dividend paid annually by Alectra Inc. based on a pooled share of 60 per cent of that corporation’s profits. Alectra Inc is a $2 billion corporation and our share will be 4.63 per cent of that pool of profits. Right now it’s difficult to determine what the dividend will be. We’ll know better following the potential approval of the merger by the Ontario Energy Board and with the first dividend payment.

The agreement has the dividend paid to GMHI. It currently owns GHESI and will own the Alectra Inc. I believe that GMHI, if the agreement is approved, should be closed down and the dividend paid directly to the city.

In my opinion, GMHI was a dreadful episode in our city’s history serving the personal agenda of the operators including Karen Farbridge, Ann Pappert, Councillors Karl Wettstein, June Hofland, Lise Burcher and Todd Dennis those elected officials who served on the GMHI board. They failed their sworn duty to protect and represent the citizens who elected them.

In my Opinion, for that reason, GMHI board members and council candidates June Hofland and Lise Burcher should not be considered for re-election.

The solution to continue supporting GMHI’s condemned function is to close it down.

According to my source that the end of all this is a $17 million loss, and the clean up has yet to be completed.

It is possible that it will take ten years of Alectra dividends to eliminate this increasing loss.

Finally, I am not yet prepared to accept this as a good deal until all the facts are known. I appreciate the advice I have received from a professional accountant and will continue to monitor and report.

 

 

One man’s opinion: Was there a conspiracy to merge Guelph Hydro instead of selling it?

By Gerry Barker

August 13, 2018

As many viewers know, guelphspeaks.ca has been a severe critic of the proposed merger between Guelph Hydro and Alectra Inc, the parent corporation of Alectra Utilities.

I call it the steal of the century.

The onus of this multi-million dollar giveaway lies with those 10 members of council who, on December 13 2017, voted to approve the merger. The truth, as it is gradually coming out, is that the council majority had already taken the bait and decided to approve the complex deal months before it took shape.

Despite late hour protests by citizens, including 22 who appeared before council expressing the need for more truthfulness, clarity and delay until the people understood what was at stake. Protests denied.

We have yet to be told how much GMHI cost the city over five years.

What did ten councillors know that we didn’t?

As a public service, here are the names of the ten: Mayor Cam Guthrie, Councillors Dan Gibson, Andy Van Hellemond, June Hofland, Mike Salisbury, Christine Billings, Leanne Piper, Cathy Downer, Mark Mackinnon, Karl Wettstein.

Councillors Phil Allt, James Gordon and Bob Bell voted against the approval.

In my opinion, there is no public record of discussions by members of council to accept the terms and considerations of this merger. The public, those people who actually own Guelph Hydro, were totally ignored by the majority of council in making the decision to merge with Alectra Inc.

So what is the truth and consequence of this decision? In my opinion, it was a conspiracy to bail out the multi-million dollar financial losses incurred by the former administration operating Guelph Municipal Holdings Inc. (GMHI) that included Guelph Hydro.

It took more than a year to finally be told the extent of the failed GMHI scheme.

Those losses and wasted resources were a stain on the city’s account books. The council realized that not even the financial resources including the credit rating of the Corporation of the City of Guelph could sustain and repay the losses.

Since early 2015, the administration has quietly worked behind the scenes with accountants and lawyers to extricate itself from the GMHI disaster in creating a system of power self sufficiency and incorporating it with a geo-thermal hot and cold water delivery to a small number of to commercial and hi-rise residences.

City council was frequently blinded as GMHI business was conducted in closed sessions for more than four years. The public, including this writer, had no clue as to what GMHI was doing.

That is, until May 16, 2016 when Chief Administrative officer, Ann Pappert signed a report along with CEO of GMHI Panaj Sardana, that revealed parts of the looming scandal that would have a disastrous impact on the city’s finances.

In mid-July 2016, a staff report provided additional information that gave more insight into what had occurred in the five years that GMHI operated in almost complete secrecy.

The plans created under the leadership of former Mayor, Karen Farbridge, were flawed and executed without the proper and necessary checks and balances.

Until the May 16 report there were many people, city staff and elected officials, who knew what was unfolding and never said a word.

The players

Let’s be frank, this could not have happened without the support and loyalty to the former mayor. Included were key staff members and some councillors who served on the GMHI board of directors. These included Lise Burcher, June Hofland, Karl Wettstein and Todd Dennis. Wettstein is not a candidate this year, Hofland and Burcher are candidates and Mr. Dennis is no longer associated with council.

It is important to note that former CAO Ann Pappert was also the Chief Executive Officer of GMHI for four years. The closed session meeting of council December 10, 2015 was when the four senior managers received the salary and bonus payments totaling $98,202. Ms. Pappert, Deputy Chief Administrative Officers Derrick Thomson, Al Horsman and Mark Amorosi were knowledgeable of the GMHI operations and problems.

Today only Derrick Thomson remains with the city as CAO although he resigned in January 2016 to take another position then returned in June to take over as CAO.

Not one of those councillors associated with GMHI, spoke up about the GMHI operations. In my opinion, they committed the highest form of dereliction of their sworn fiduciary responsibility. In fact, they were all paid extra for participating on the GMHI Board.

Coun. Karl Wettstein declined to participate during a council meeting discussing the   GMHI situation on the grounds that because he received remuneration for his membership on the GMHI board, he declared a perceived conflict of interest based of his financial connection.

But that didn’t stop Coun. June Hofland and Mr. Wettstein from voting for the merger of Guelph Hydro.

The extraordinary part of approving the merger is that those ten councillrs couldn’t have known what they were approving. The agreement was still being negotiated and it wasn’t completed until February, this year. That’s when a written proposal, containing 19 documents was available on request. Some of which had major redactions, Alectra Inc. and Guelph Hydro presented it to the Ontario Energy Board for approval.

No date has been set for the OEB to conduct a hearing and make its decision. There are four interveners who will ask the OEB to reject the proposal. A spokesperson for the board estimated that the hearing will not be held for up to 12 months.

Based on that statement, no decision will be made before the October civic election.

Entering from Stage Left, the SOC

The framework for this abortive, agreement hatched for the most part in closed sessions, was created in the fall of 2016 by the council-appointed Strategies and Options Committee aka SOC. It was originally co-chaired by Chief Administrative Officer Derrick Thomson and Guelph Hydro Chief Executive Officer Pankaj Sardana. There were three other members on the committee who we’ll call civilians.

There were no elected officials on the committee.

The structure of the SOC changed as Hydro Chair Jane Armstrong replaced Mr. Sardana. Two other members were replaced. This change occurred prior to February 2017 when council made a major decision, in open session, to remove the option of selling Guelph Hydro from further discussion or negotiation.

So why was council told to dump the option of selling the $300 million profitable, publicly-owned power distribution systems serving 55,000 customers?

I have learned that there were at least two neighbouring municipalities that expressed an interest in buying Guelph Hydro. Because this was discussed behind closed doors, we’ll never be told who they were.

The reason that the SOC was instructed to stop selling the crown jewel of Guelph remains a great, untold story of backroom intrigue and arm-twisting.

But the reason is clear that the massive debt accumulated by the Guelph Municipal Holdings Inc., along with Guelph Hydro, chaired by the former mayor, had to be dealt with on the city books.

For the record, this merger is to get rid of that debt by giving away Guelph Hydro and its assets to Alectra Inc for almost nothing. You don’t have to hold a PhD in accounting to figure this out.

How did the city get out of this hole created by a former administration without borrowing money from a recognized lender such as a bank or credit union?

Welcome to Trader Joe’s

The answer friends is they made a deal with the devil and traded Guelph Hydro and all its functioning assets to Alectra for a tiny share of Alectra Utilities’ profits of just 4.36 per cent but only sharing in 60 per cent of Alectra Utilities profits.

Voila! The trade kicks the accumulated debt of Guelph Hydro controlled by GMHI. The merger agreement states:

“The purchase by Alectra Inc. of all the issues and outstanding shares of Guelph Hydro held by Guelph Municipal Holdings Inc. a wholly owned corporation of the City of Guelph.”

It’s important to note that Alectra Utilities is a subsidiary of Alectra Inc. This corporation is the so-called “purchaser” but Guelph only shares in the profits of its ubsidiary corporation.

Here’s the brutal truth. Alectra Inc. once approved as the new owner of Guelph Hydro, is dropping that brand name as soon as the OEB approves the merger. Here’s another possibility, Alectra Inc. can sell the assets of Guelph Hydro to the highest bidder and walk away with millions.

Mayor Guthrie keeps saying that the city is giving nothing away when asked about the proposed merger.

Did you know that the city admits it has spent YTD some $2.6 million of your money to sell this deal to us. The head of the city’s communications department was the key driver of the campaign to convince us with slanted polls and town halls where few people turned up.

Then just before the vote to approve the merger, the city announced that it was receiving an $18.5 million “special dividend” from Guelph Hydro as soon ad the deal is approved.

So our council is so smart to believe that getting $18.5 million of our own money is a fair trade for a $300 million corporation that the citizens happen to own.

Alectra Inc. is virtually getting a very valuable asset for nothing. The city negotiators were even willing to give Alectra the Hydro reserve cash but they declined.

And why not? They just got the whole enchilada for Pesos on the dollar.

Can you imagine this happening in a private corporation?

Those remaining eight councillors running for re-election will have to explain why, why did they fall for this grand theft Hydro?

It’s insulting and deplorable that in the new Working Together community report addition to the city website, the claim is made that city assets have increased by $13 million and the debt has been paid down by $24.4 million.

It only goes to prove that there is a sucker born every minute. Only we are the suckers who have experienced the malfeasance of those councillors who approved this deal.

In my opinion, there is strong evidence that this is a major cover-up that has the odor of conspiracy to defraud the citizens of a valuable asset to settle the mismanagement of the previous administration.

I believe there are grounds here to have an investigation by the Ontario Attorney General to determine if there is evidence of a crime being committed.

This isn’t going away.

After four years Karen Farbridge is alive and well on the city’s website

By Gerry Barker

August 5, 2018

Contained in a new glossy addition labeled “Working Together” that can be found on the city’s website, we discover the omnipotent presence of the former mayor circa 2007 to 2014.

The following outlines some of the projects and policies of the former mayor. In fact there is a large presence on this new section of the city’s website. Today, we only address some of the topics of interest and concern of citizens in Guelph. There will be more coverage in the next few weeks, exclusively in guelphspeaks.ca.

So you thought when Karen Farbridge was defeated in 2014 the voters rejected her and her policies.

Nope. She’s still present and on the record according to the Guelph city website’s “Working Together” a new remake featuring the Guthrie years as Mayor

Any presumption in early 2015, that new Mayor, Cam Guthrie, would keep his word to end the so-called “Guelph Factor” and keep property tax increase no greater than to the Consumer Price Index. That flew out the window March 2015 when city council passed a property tax increase of 3.96 per cent. The CPI rate at the time was reported to be 1.99 per cent.

It was the beginning of an administration headed by a Mayor who is now described as Farbridge ‘Lite’, and with good reason.

In December 2015, the administration’s greatest test however fell upon the administrative professional staff. Four top city managers were granted, in closed session, huge increases totaling $98,202. Within four months, CAO Ann Pappert, Al Horsman and Derrick Thomson had resigned. Only Deputy Chief Administrative Officer Mark Amorosi remained.

The senior management was gutted and the city council struggled to maintain some form of leadership. CAO Pappert left May 26, 2016. Former senior manager Derrick Thomson resigned in January 2016 to take a job in his town of residence. He was recalled and took command of the professional staff in June 2016. Former Chief Financial Officer, Al Horsman left in August 2015 for the CAO’s job in Sault Ste Marie.

The Sunshine List showed that Ms. Pappert received $263,000 for five months work and Mr. Horsman received $181,000 for his eight months tenure in 2015.

The lady remains a featured player in the Grand Royal City Opera

After reading the details on the city website, one would believe that former Mayor Karen Farbridge was still in charge. Even though she has been gone for almost four years, her imprint remains on the official city website. Yikes!

This can only be described as the current city councillors giving the middle finger salute to the people they work for and are responsible to.

The following is on the city’s website today:

“In November 2008, Mayor Karen Farbridge and Guelph City Council committed to the development of a new ten-year Economic Development and Tourism Strategy for Guelph — Prosperity 2020.

Prosperity 2020 will support the City of Guelph’s vision of being “the city that makes a difference”, and the strategic goal of having “a diverse and prosperous local economy.”

The Phase 2 Economic Development & Tourism Strategy will provide direction, priorities and performance measures for the transformation of Guelph’s economy over the next decade and beyond.

Here are the members of the Mayor’s Prosperity 2020 task force.

Karen Farbridge, Mayor, City of Guelph
Frank Valeriote, Member of Parliament, Guelph
Liz Sandals, Member of Provincial Parliament, Guelph
Dr. Alastair Summerlee, President, University of Guelph
Mark Goldberg, President, GlobalTox International Consultants Inc.
Mike Bouk, Executive Director, Ag-Energy Co-operative
Lloyd Longfield, President, Guelph Chamber of Commerce
Kevin Hall, Vice President (Research), University of Guelph
Dave Smardon, President/Director, BioEnterprise Corporation
Don Drone, Director of Education & CEO, Wellington Catholic District School Board
Kathy Bardswick, President & CEO, The Co-operators Group Limited
Michael Annable, Industry Representative.”

 

Let’s update the ten-year program titled “Prosperity 2020.”

What did the task force accomplish in those ten years? Also where are most of them now? Are we better off today?

Well, it’s what they didn’t accomplish is the real question. It’s fair game for citizens to question why this is still posted on the city website’s new feature presentation ‘Working Together.’

So let’s review how ‘Prosperity 2020’ has affected the quality of life in our city in the past ten years.

First, economic development means creating jobs, increasing industrial and business assessment and creating a balance of property tax revenue between residential, industrial and commercial expansion.

That has not changed in 12 years under two Farbridge and one Guthrie Administration. At a ratio of 84 per cent residential and only 16 for industrial and commercial assessment, it has not altered since 2001 when Karen Farbridge was first elected Mayor.

By any measure that does not mirror economic development. Instead, the load keeps falling on the shoulders of those property-taxed owners who have experienced huge increase in taxes on their properties.

The average assessment ratio in Ontario is 60 per cent residential and 40 per cent industrial and commercial.

Think about this: If the ratio increased from the present industrial/commercial figure of 16 per cent to 30 per cent, the effect would be less dependence on the residential assessment. But three administrations, in 18 years, failed to accomplish anything to correct the imbalance.

Just look at why the city administration failed to increase the economic development revenue ratio. The city website remains a mortuary of the Farbridge administrations that has cost we citizens millions.

Taking a trip down memory lane

* Remember the $23 million Urbacon cost overruns?

* The $15 million GMHI? District Energy and geo-thermal plants?

* Natural gas generating plants that were never built?

* Waste management debacles including buying trucks for auto pick-up of bins??

* Spending $5 million to buy two buildings on Wyndham Street to turn the space into    enlarging the Baker Street parking lot?

* Overbuilt organic wet waste processing facility costing $34 million?

* The Detroit recyclable fiasco?

* Closing lanes on major roads to allow bicycle lanes?

* Intensification of residential complexes with little open space and parking?

* The lack of parking downtown?

* Failure to clean up the downtown possessed by druggies, drunkenness, panhandlers and the homeless?

* Failing to build affordable housing for the less fortunate working poor?

* The renovated railway bridge on Wyndham Street that had large trucks crashing into it.

And don’t forget the high increases annual taxes paid by the residential owner and user fees charged for city services. The city is so desperate for revenue that it inflicted a one per cent levy on property taxes allegedly to pay down the $500 million infrastructure deficit. Then Council approved an additional one per cent levy on properties for “City Buildings.”

Truth to tell it was a move to start funding the $63 million South-end Recreation Centre. The two counncillors sponsoring the motion were Mark MacKinnon and Karl Wettstein. Both represent Ward Six. Some $3.5 Million has already been spent on plans for the $63 million recreation  centre in Ward Six.

Until citizens realize that their 2014 vote was wasted when the new mayor capitulated to the demands of the seven-member progressive bloc who are dedicated to preserving the Farbridge legacy.

Otherwise, what more proof do you want that if anything there is a ton of Farbridge’s ill-conceived and executed action plans that have left an indelible historical imprint on the history of our city.

This study of the Farbridge unabridged legacy is far from over, more to come.

Perhaps a website content purge is in order.