Monthly Archives: July 2019

The 2007 Community Energy Initiative steered Guelph down the financial rabbit hole

By Gerry Barker

July 29, 3019

Opinion

Part Two of Seven

This part of the series outlines the objectives of the Community Energy Initiative (CEI) plan that was formed with excitement across a range of citizens when the non-elected consortium produced the future plans for the city. It was the beginning of the greening of Guelph.

The CEI was created by former mayor Karen Far bridge and supported by her majority on city council. As a result there were no checks or balances to question the decisions made by council for the following seven years.

The founding group was composed of members of the city administration, Union Gas, (now Enbridge), Guelph Hydro, representatives of business and Industry, University of Guelph, school boards and the Guelph Chamber of Commerce.

Without doubt it was a blue chip group from many interest groups in the city.

Here are the reported CEI goals:

* 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

There is no estimate of the costs of these goals or details of achieving them.

The CEI report, at the time, said that the goals would position Guelph among the top energy performers in the world.

How has that worked out for you?

Let’s start examining goal One to use 50 per cent less energy per citizen.

Setting goals is one thing but forcing people to change the way they live is another matter.

In 2007, the Farbridge administration initiated expansion of bicycle lane networks on major city streets to help reduce dependence on fossil fuel emission by motor vehicles.

Piggy-backed on this goal was increasing use of alternative transportation, (bicycles) and public transit.

The first major project was installing dedicated bike lanes on Stone Road in 2009 by taking advantage of the tri-government infrastructure program in which Guelph’s share was one third of the $66 million approved by all parties.

That project cost $2 million. Then council approved a ten-year bike lane development plan, spending $300,000 per year. But here’s what happened:

The city embarked on resurfacing portions of major streets all of which were to accommodate bike lanes. Part of the individual projects was to shrink the road to three lanes to two for traffic and a centre lane for left turns. The shrinking included painting in bike lanes on either side of their freshly resurfaced road.

But this accommodation for cyclists did not extend beyond the portion being resurfaced in most cases. These include Silver Creek, Woodlawn, Stevenson, Speedvale, Woolwich, Victoria, Gordon, Downey, and Clair Road to name a few.

This attempt to provide alternative transportation, thereby reducing greenhouse gas emissions, was thwarted by a growing population that was 119,000 in 2007 when the CEI was approved, to 131, 000 by the last national census in 2016.

Does more mean less?

Accordingly, more people mean more cars, trucks and transit vehicles. That adds up to increasing greenhouse gas emissions.

The new housing enclaves of attached strip houses, low-rise condos and high-rise apartment buildings, has further exacerbated the building boom of new housing. Then add the undergraduate population of the University of Guelph that has expanded with 22,000 now attending.

Traffic congestion, intensification following new housing development and improving rail service to Toronto, These are factors in increasing energy use, not decreasing it when the CEI goals were approved.

The same events apply to the second goal of producing 60 per cent less of greenhouse gases per capita. The timing of this vision is not mentioned in these goals’ report. As it turned out, it was an open cheque book opportunity for city council to introduce personal ideas and projects to achieve these CEI goals.

WE now know that more people driving more fossil-fueled vehicles does not reduce the greenhouse gas emissions

Let’s follow the money

Who benefits from all this housing built in Guelph since 20017?

Well, the Chamber of Commerce should be happy with the growth of commercial business in the city. The building trades have prospered and last, but not least, the development industry and supporting cast of architects, town planners and lawyers who benefit from the housing and commercial growth since 2007

In Mayor Guthrie election financial report presented to the city, it revealed an interesting fact. The mayor collected some $86,000 for his campaign from people who did not live in Guelph. Most were developers and service corporations seeking access to the Guelph market. Of this group, out of the 100 individual and corporations who donated some 29 per cent were from the development industry. Most of the donations were $1,200, the maximum allowed by Elections Ontario.

Did all this development meet the 2007 CEI goals of reducing energy in the city by 50 per cent, or reducing 60 per cent less greenhouse gas emissions or facilitate and encourage community based renewable and alternative energy system?

WE now know how that last goal went. All it costs citizens more than $66 million with the failed Guelph Municipal Holdings Inc. district enery projects.

The irony is that despite the loss of millions of dollars by two administrations, is that the remnants of the Farbridge eight-year social engineering adventure is why does the CEI still exist? Its premise and goals are still influencing today’s council.

How did all this lower energy use reduce greenhouse gas?

This part will explain in 2009 how the wheels falling off when Guelph Hydro announced its subsidiary, Ecotricity Corporation, reported a loss of $3,945,000. The report stated that the loss was due to declining extraction of methane gas used to generate electricity at the Eastview landfill garbage site. This is contributed to an “impairment charge” of $2,984,000 of the corporation’s total loss in 2009.

An “impairment charge” is an accounting term based on the amount of an investment is less than the carrying charge, then the assets are deemed to be impaired. The amount of the investment must be eventually written down to the recoverable amount, if any exists.

In 2014, Councillor Cam Guthrie defeated Mayor Farbridge. There was hope that reform would occur and civic sanity would arrive.

In other words, it’s Act Two of the Farbridge CEI legacy and citizens are all empty-pocket endangered species.

There is only one way out and that is to elect a council of moderate, thinking, and responsible candidates to change the menu and reform the administration.

Stay tuned to more information that will be revealed in future parts of the Guelphspeaks seven-part series on the pathological odyssey of corruptive practices. There are other examples of losses and impairment charges that slammed city finances.

Miss the introduction and Part One? All published parts are located in the Guelphspeaks archives located on the website and are filed post publishing’s usual comments are welcome

Next, Part Three: is  to be published August 1, 2019.

How irritated spite increased the cost of the new city hall by $23 million

 

 

 

 

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Where well-meaning people of community stature got it all wrong

By Gerry Barker

July 25, 2019

Opinion

Part One of Seven

The beginning of the downhill drain of public money called the Community Energy Initiative (CEI) was unanimously approved by city council in 2007. The first year of the Farbridge administration’s dominant 2006 victory elected 11 councillors supporting the mayor.

The blueprint of change was discussed and approved by a select group of citizens ranging from business leaders, the University of Guelph, Chamber of Commerce, senior staff, Guelph Hydro, and key supporters of the Farbridge administration.

That election formed the genesis for committing public funds and the city on a number of projects to change the way we live. These include electric power, clean water, transportation, unorthodox waste management, home development, city operational management, industrial development, and restrictive procedural bylaws.

This unfettered control of the city administration, provided the ignoble ending of accountability, transparency and open government. The firing of two key city executives, Chief Financial Officer David Kennedy and Chief Administrative Officer Larry Kotseff led to the tightening control by Mayor Karen Farbridge to carry out the mandate surrounding the CEI and approved by leaders in the community.

It also began the 13-year increases in property taxes, averaging more than three per cent each year. The elimination of veteran senior managers removed the key checks and balances needed to control finances, to meeting provincial requirements. It’s required to balance the budget at the end of the calendar year and avoid a deficit.

This left the city administration with three choices: Raise revenues (property taxes and user fees) or increase the debt, or raid accumulated reserve funds to balance the city books. It is reported in the annual Financial Information Report (FIR) submitted to the Ministry of Municipal Affairs and Housing.

The contents of this voluminous report are not made public until the middle of the following year and generally not read by the citizens. So much for open government.

There is one exception to the content of the FIR. It contained the salaries of all public employees earning more than $100,000 plus taxable benefits. It is called the Sunshine List and is published every March.

This eventually became the Achilles heel of the city financial reporting. In December 2015, a closed session of council, in closed-session, approved a $98,202 increase to three senior staff CAO Ann Pappert, Deputy Chief Administrative Officers (DCAO) Derrick Thomson and Mark Amorosi.

In March, the Sunshine List revealed the trio’s 2015 salary and taxable benefit increases.

I am acutely aware of this issue as DCAO Mark Amorosi subsequently sued me for defamation after comparing the difference between the 2014 Sunshine List and 2015.

This matter after almost three years is now in the hands of Superior Court Justice Cynthia Peterson who has heard the submission of both counsels in which my lawyer is seeking a dismissal of the charges.

For the Farbridge administration it was only the beginning of raising revenue. User fees were increased as the city morphed into a growing municipality. The focus was on reducing fossil-fueled vehicles that were denigrated by a string of environmentalists whose representatives formed a majority of city council. All in the name of reducing greenhouse gases affecting climate change.

The bicycle lanes frequently started and stopped during expansion on the major routes shrinking vehicle lanes. Today, the result is congestion, worse that it was in 2007 because the population increased, the major streets hogtied the space for vehicles that were established years ago. What did the planners think was going to happen?

In the eight years of Mayor Karen Farbridge’s administration, few people cared about the ongoing development of increasing traffic In the city.

But here was a new major city redevelopment brewing that would lose more public money than any project known in the history of Guelph.

In 2012, wedged in all this was a citizen’s petition to the Minister of Municipal Affairs and Housing to audit the finances of the city. Ordinary and concerned citizens generated it. The likelihood today is not many people read it. If they did they probably would not remember it after seven years. The petition was carefully researched and vetted for accuracy. But was shot down by the Minister.

The citizen’s activist group, GrassRoots Guelph, prepared the petition, it was signed by 160 ratepayers. It was documented using official city figures as submitted in the annuals FIR mandated by the province. The petition detailed the discrepancies in the FIR over three years. Here is a draft copy of the petition. Today it only adds to the lack of financial management that has plagued this city since 2007.

As it was denied the Minister, Linda Jefry, she resigned from the government shortly after to run for Mayor of Brampton in 2014. In 2018, former Ontario Progressive Conservative leader, Patrick Brown defeated Jeffry.

                  Application to the Ministry of Municipal Affairs

         Requesting an audit of the City of Guelph’s finances and operations

         As per the Municipal Affairs Act R.S.O. 1990, Chapter M.46 Part II

September 12, 2013

Please note that this petition does not include the Urbacon city hall lawsuit settlement and associated costs was brfore the courts at thos time.

Under part II section 9 (1) we, the 162 undersigned taxpayers, request a Provincial Municipal Audit of the City of Guelph’s finances and operations. Our concerns are the management of the city that has resulted in exponentially increasing liability to the taxpayers now and in the future.

In our collective opinion we citizens agree with the following:

Finances

  1. In the past four years, when figures were available, the City of Guelph expenditures exceeded budgets by a total of $24,771,000. The amounts were: 2012; $10,750,000; 2011; $5,783,000; 2010; $2,581,000; 2009; $5,657,000. In our opinion if the trend continues, these figures will exacerbate future liability to the taxpayers and the corporation.
  2. Further, the audited financial statements for the City of Guelph in the comparison year did not compare to the figures of the previous year. For example, the 2011 statement showed 2010 expenditures of $309,198,000 while the previous audited statement showed a figure of $305,482,000. This is a difference of $3,716,000. Similarly, 2009 shows a difference of $3,668,000. In our opinion, expenditures exceeding budgets year after year produced by the required annual audit, does not imply confidence in the accounting numbers.
  3. The above data points out some of the imprudent financial decisions and management by the City of Guelph.
  4. The current administration created a municipal holding company of which the chief revenue component is Guelph Hydro. In the current year, the holding company, controlled by the Mayor and her cohorts on council, plus two independent directors, approved a $2,995,000 dividend that was 96.7 per cent higher than previous years. Despite an income decline of 44.1 per cent to $1,057,000. The result was a 179 per cent payout ratio as dividends exceeded earnings. In our opinion, this withdrawal does not meet corporate standards of risk/reward and is a misuse of public funds.
  5. A non-budgeted and undocumented item that appeared in the 2011 and 2012 City of Guelph annual reports was used to boost revenues. In 2012, a $20,744,000 entry labeled “contributed subdivision assets” was stated while a similar item in 2011 totaled $9,901,000. Neither was in the budget. In our opinion these non-cash entries only serves to embellish revenues.
  6. A report dated April 10, 2012, from the finance department labeled “Unaudited Operating Variance Report” stated that the total enterprise budget had a favourable variance of $4,304,000. Please note that this occurred three months past year-end. Yet in the Guelph audited Annual Report dated June 27, 2012, the expenditure variance was a negative $5,783,000. On the revenue side, the variance was $39,495,000. Neither figure was remotely similar to that presented to Council. In our opinion this does not instill public confidence in the City of Guelph accounting methods.
  7. The reporting of financial data to taxpayers lacks clarity and accessibility. In our opinion, posting a 300-plus page 2013 budget document on the city’s website is not sufficient or accessible to most taxpayers.

Legal matters facing the city

  1. As of March 11, 2013, there are 16 court matters reported in the Litigation Status Report. In addition, there are 16 outstanding Ontario Municipal Board hearings. There are 23 insured matters to be resolved. In our opinion this represents a potential unfunded liability to taxpayers. (Current Litigation Report in attached as appendix A)
  2. An example was the city’s attempt to leave the Wellington Dufferin Guelph Public Health Unit. The resulting court case was lost but the legal costs incurred were never revealed. In our opinion this was a politically motivated attempt to opt out of a Provincially mandated Health Unit and failed to publicly disclose the cost to the taxpayers. Until the court case was settled, Guelph council’s representatives refused to attend WDG Health Unit meetings for many months.

Capital spending

  1. In our opinion, in 2011, the city breached its 55 per cent of current budget capital spending limit. Under the self-imposed limit, the 2011 debt ceiling was $94 million. Instead the debt rose to $121 million.
  2. In our opinion, taxpayers are concerned about city announcements of proposed capital spending projects including: A $73 million downtown library to be operational in 2017; a $37 million south-end recreation centre and then propose to spend $16 million to expropriate an existing commercial centre and convert it to a new riverside park.
  3. In our opinion, the capital and operational spending in Guelph’s downtown has created a vacuum preventing needed spending on projects in other parts of the city. For example, the proposed south-end recreation centre, to be built in an area where there has been substantial residential development in the past ten years, is proposed in the long-term capital plan

4. Employee Costs

  1. Figures released by the city audit in 2012 showed that civic employees
  2. Total compensation costs were 88 per cent of the city’s property tax levy.
  3. From 2008 to 2012. Guelph civic employees’ received total compensation increases of 31 per cent. In 2008, the city spent $124.8 million on compensation. In 2012, it spent $163.6 million. In our opinion this was triple the annual inflation rate during the same period.
  4. Between 2006 and 2012, during the period controlled by the present administration, City of Guelph employees’ costs increased by 68.1 per cent. Or 10.9 per cent per year. During the same period, the comparable employee cost increase of its peer group included: The City of Kitchener, (35.3 per cent), The Region of Waterloo, (42.8 per cent), the City of Cambridge, (29.6 per cent). It represents a 41 per cent increase in employment costs over the peer group.
  5. In our opinion the Guelph employee costs are excessive, in view that the population of the city grew by 5.8 per cent in the same period.
  6. Reference: Presentation to Guelph council by taxpayer Milton Burns November 29, 2012 based in city administration reports and the Ministry of Municipal Affairs FIR report, schedule 42 (Copy attached).
  7. Between 2006 and 2011, the city has had four individuals performing as chief financial officers. One of these was a deputy treasurer in the financial department who was responsible for managing the city finances for more than a year, following the dismissal of the previous CFO. Another candidate lasted one week on the job. The current CFO was hired in July 2012. In our opinion, this has resulted in a lack of taxpayer confidence in the management of the city’s finances.

Waste management

  1. Failure by the city administration to provide taxpayers the opportunity to comment on operational decisions, involving major capital spending of waste management projects.
  2. In our opinion, the building of a $33 million organic waste processing facility (OWPF) without revealing details of the construction, operational costs and contractual obligations, represents a breach of fiduciary responsibility of the city council.
  3. The question arises as why the processing capacity of the facility, as approved by the Ministry of the Environment, is six times the wet waste needs of the City of Guelph.
  4. In our opinion, selling the right to 20,000 tonnes of the facility’s capacity to the Region of Waterloo, without revealing the operating costs, has not served the taxpayer’s interests.
  5. In our opinion, City Council, without informing taxpayers or consideration of the accessibility to collect waste from all residences, awarded contracts totaling $15 million to install an automated bin-based waste collection system.
  6. This system is not available to 6,400 condominium residents due to the city refusing to pick-up waste in these developments. This represents 13.6 percent of the 47,000 Guelph households being forced to not only pay taxes for waste collection, but also pay private contractors to remove garbage. In our opinion, this is not fair to those homeowners affected.
  7. Terms of a contract with the Lystek Company of Cambridge that processes human waste to store and dispose of city treated solid sewage sludge have not been revealed. In our opinion, this fails to detail safe disposal.

Conclusion

  1. In our opinion, the present financial and operational situation in the City of Guelph will provoke future tax liabilities that cannot be corrected in a short time frame. Among these, is the growth of staff, defined pensions and sick leave liabilities under OMERS and employee associations, of which the majority of civic employees are members? This will adversely affect the municipality’s budgets for years to come.
  2. Considering that in 2011, 52.2 per cent of city revenue was derived from property taxes, plus another 20.9 per cent in user fees, we request an independent audit of the city’s finances and operations to examine taxpayer exposure to current and future liabilities.

Respectfully submitted by the attached list of those supporting this petition.

The Minister said that the two parties, the city administration and GrassRoots Guelph should settle the matter. That did not happen because GRG demanded that the meeting be held in public and in the River Run Theatre. It never happened and CAO Ann Pappert called the petition a waste of time, but whose?

Next, Part Two: How the 2007 Community Energy Initiative plan steered                                     Guelph down the financial rabbit hole

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Here is the 13-year pathological destruction of democracy practised by two city administrations

By Gerry Barker

July 22, 2019P

Opinion based on facts

This Guelphspeaks seven-part series is copywrite 2019

The following is a seven-part series on how two city administrations have embarked on spending public money on projects that lost an estimated $320 million and have nothing to show for it.

Today, we begin with the outlines of the seven part series, plus the introduction that I call the pathology of 13 years of secrecy, mismanagement and cover-ups leading to a moral and financial disaster.

Alectra Utilities, the bidder on the merger with Guelph Hydro, targeted the gullible Guthrie administration with promises, public relations and guidance.

I know the price of public dissent and what lengths this council and the previous Farbridge administrations would do to prevent or muzzle any criticism or negative commentary.

The result has been dictatorial and managed usung a cloud of secrecy denying the public’s right to participate, adhere to accountability and transparency. You will read later of what and how they did it.

We all shared the responsibility of this 13-year journey, at the public expense, because we elected a council whose membership failed to understand complex issues and the relevant costs to the public.

Nothing has changed. The present council allowed projects to take place without proper planning or adopting ego-driven compulsion to be the greatest and most advanced city in the world. The concentration of political power included promises that were not fulfilled.

Council promised cheaper electric power, elimination of fossil fueled vehicles from city streets, forcing developers to stop building detached, single-family homes and meet net -zero carbon in new developments.

The series will track how public money and assets were spent or given away.

This series is about how the destruction of democracy, and its mandatory accountability, transparency and open government in our community. It was used to block our right of public participation in municipal governance.

Let’s get started:

Starting Thursday July 25, Guephpspeaks will publish the first part of the series in seven posts that changed city administrations that, in part, wasted public funds and assets costing, at latest countn more than $145,000,000.

But it gets worse. The following is a collection of money spent that is separated into two parts: Confirmed Project’s costs, and a list of estimated cost, based on information that needs a professional audit to determine. It is noted that council approved spending more than $300,000 last year giving money away under the guise of a policy known as Wellness. City councils, over the years, have donated money to social and cultural causes but not on this magnitude.

The confirmed loss List

Urbacon city hall excess cost over contract – $23 million – Gone

City equity in Guelph Municipal Holding’s liabilities loss – $66 million – Gone

Guelph Hydro merger deal, book value in 2016 – $228 million – Gone

The estimated loses require an audit

Infrastructure biccyle routes and trails $7 million

Advertising and promotion spread over 13 years – $$10 million

Investment in Guelph Innovation Development project – estimated $4 million

The Organic Waste Processing Facility – $34 million

This brief list totals $372 million since 2007 or an average of $28,613,000 each year. It is only a partial list that does not include legal and consultant costs.

Oddly, when deducting the Guelph Hydro loss it comes to $145,000,000.

It only makes the Guelph Hydro merger with Alectra Utilities the worse deal ever made by the city.

This list contains some items that are estimated, as the data is buried in multi-page Financial Information Reports (FIR) submitted by the city annually, as mandated by the province in the last 13 years. This multi-page document is not generally available to the public.

Another method used by the administration to deter details of financial information from the public. The FIR is the only financial record officially released by the city. Quarterly summary financial statements are not sent to citizens. Along with other information council deems should not be made public, include the closed-session meetings in which the minutes are never made public. In two years, 2015 and 2016, council held 84 closed-session meetings.

Missing this analysis is how the reserves were emasculated to balance the books due to overspending annual budgets. In 2009, city councillor, Leanne Piper, claimed the city had reserves of some $77 million.

In 2016, BMA Management Consultant warned the reserves were reduced to a point that warranted a “red flag” as a result of council’s decision, using reserve funds to shore up its financial picture. In 2014, three unrelated reserve funds were withdrawn to pay for the Urbacon lawsuit settlement.

Flash from the past

Here’s a Guelphspeaks post published July 2012. The observations are a harbinger of what was to come and how council conducted the public’s business in the previous five years. It points out the dangers of dictatorial power that had already occurred under the Farbridge council majority, a supporting cast of senior managers plus unelected advisors to the Mayor’s council, Ken Hamill, retired executive and former councillor, and Cathy Downer, a present member of city council.

                      How our city administration derails democracy

When the underlying issues of a civilized society are endangered by a dictatorial and secretive administration, democracy, as we know it, vanishes.

It’s a natural instinct for those in power to withhold information that may reflect on their actions and management of the public assets.

Once in power, the tendency is to surround your self with friends and supporters who blindly follow.

One of the first tenants of political power is to control the message and give the appearance of serving the public stakeholders. Those controlling the agenda ignore disagreement and rejection of the controlling political organization’s policies.

This leads to anger and disillusionment on the part of the stakeholder, you and me.

So, thanks to a report by Carol Goar in the Toronto Star, here are three lessons to emphasize the theory of democracy discarded by those empowered.

Lesson One: Those with power – politicians, police and bureaucrats – don’t believe they should have to share that power. Basically, they dismiss the rights of citizens to share that power and don’t believe they have any role to play in their sphere of influence.

Lesson Two: Governments frequently slap pejorative labels on those who oppose and complain. Such methods are to use surrogates to attack those objectors labeling them as ignorant, dangerous, violent and out of touch.

Lesson Three: Citizens have to use the tools they have to keep democracy alive. These include solidarity, willingness to stand up to authorities and to reach beyond their own ranks.

How does that menu rank with what has been going on in Guelph for the past six years?

First, we have been governed by a civic dictatorship composed of a majority of councillors who, 99 per cent of the time, votes their own agenda. The opposition – in the first four years consisted of just two councillors. Since 2010, the opposition has grown to five councillors who have voiced concerns about the operation of the city government but are defeated most times when votes are held.

There is growing evidence that Mayor Karen Farbridge, the architect of Guelph’s public policy, along with a close-knit group of unelected advisors, has created a growing unrest among voters.

Democracy is no longer operative in this council.

The administration works in two parts. The mayor to carry out her agenda has handpicked the senior bureaucrats. Policy rests with the mayor and her advisors including former councillors Ken Hamill and Cathy Downer.

The Mayor is beholden and influenced by the Guelph Civic League although since the 10 Carden Street organization came into being that influence has diminished. Instead, 10 Carden Street is the stepchild of the Guelph Civic League. It received a $135,000 Trillium Foundation grant from the provincial government to provide “community services.”

This is a thinly disguised political action group dedicated to support the present Farbridge political organization.

The artful part is how the Farbridge crew has influenced and received support from a number of community and neighbourhood groups supplying public funding, support in planning and social issues.

The offshoot of all this is the vast silent majority of voters who are not united, knowledgeable nor organized to question or oppose policies advanced by the Farbridge political organization.

This has resulted in participatory democracy failing to acknowledge its majority rule.

For almost six years, the rule is by a tight-knit group of individuals who operate under the mantra of: “ it’s our way or the highway.”

Today nothing has changed, as you will read in future series posts. Still not convinced?

The ambition of this group has cost taxpayers millions in personal pet projects, dumb planning, excessive legal expenses and fiscal mismanagement aided and abetted by unqualified or absent individuals. Those elected people responsible for protecting the public interest and having sworn to maintain fiduciary responsibility. That means providing the checks and balances during their term of office

*            *            *            *

Ego is not a new breakfast dishost of the severe loss of capital and assets was due to ego-driven projects, poor planning, incredibly sloppy maintenance of city owned property and assets. Accountability and transparency disappeared.

This became a recipe for financial disaster. The turmoil at the top of the professional staff contributed to the waste of public money. The firing of Urbacon Buildings Group Inc., general contractor of the new city hall, cost an additional $23 million over the original budget of $42 million. The case took six years to settle the lawsuits and disruption of operations.

This series will present the litany of losses and impact on the municipality over 13 years. There is evidence that rules were bent to accommodate projects in which the public could not participate. Frequently, the news media rarely questioned the motives of the administration when the public business was conducted in closed sessions.

It is the intention of Guelphspeaks to send copies of this series to the Minister of Municipal Affairs and Housing, Attorney General and Ombudsman.

Here are the seven parts of the exclusive series only available on guelphspeaks.ca. As usual, your comments are welcome

Part One         Where well-meaning people of community stature got it all wrong

Part Two         How the 2007 Community Energy Initiative plan           steered Guelph  down the financial rabbit hole

Part Three      An irreparable spite increased the cost of the new city hall by  $23 million

Part Four –    Guelph Municipal Holdings Inc. covers-up losses of $68.3 million

Part five         The city gave Guelph Hydro away ignoring questions    about the deal

Part Six         City councillors were targeted to give away the $228 million Guelph Hydro to Alectra Utilities

Part Seven      Why the downtown Library and South End Recreation Complex   are endangered projects

The series starts this Thursday July 25.

 

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Who profited and what happened to Guelph Hydro’s cash surplus of $18.5 million special dividend ?

By Gerry Barker

July 15, 2019

Opinion

It happened December 13, 2017, when ten members of city council voted to merge Guelph Hydro with Alectra Utilities Inc. It was the greatest heist of public property in the history of our city.

There may be other corruptive details made in the almost 200 year history of the city but I’m betting there isn’t.

In all the years I have experienced growth in our cities and towns, corruption is the handmaiden to making money for persons of influence.

Was there evidence of corruption in the merger between Guelph Hydro and Alectra?

Well here is a hint.

Did the co-chairs of the council-appointed Strategic Options Committee (SOC) charged with disposing of Guelph Hydro, profit from their influence and positions?

Former Chief Administrative Officer, Derrick Thomson and Guelph Hydro chair, Jane Armstrong, were unelected officers of the city and Guelph Hydro. They received regular salary and benefit payments to perform their respective responsibilities.

In my opinion, both these individuals, with the acquiescence of city council, crossed the line in terms of their job and fiduciary responsibility to the citizens of the City of Guelph.

Mr. Thomson, according to city financial information, was paid $335,000 in 2018. This information is sourced from the 2018 Sunshine List published in March 2019.

Mayor Cam Guthrie announced May 18, 2019, that Mr. Thomson was paid a $67,000 performance bonus more than his 2017 salary. The Mayor stated it was in recognition of his leadership regarding the Guelph Hydro merger with Alectra Utilities.

In that same month, Mr. Thomson left the city with no explanation.

Former Guelph Hydro chair, Jane Armstrong, was appointed by council to the Board of Directors of Alectra Board Utilities to represent the city. Her appointment was for five years at a salary of $25,000 plus travel and board meeting expenses.

These two public executives were directly involved in all the negotiations with Electra Utilities. Those SOC meetings were conducted in closed-session, far from the public’s view or understanding.

The fact that the Ontario Energy Board approved the merger without allowing interveners to testify only solidified this deal, and was a deliberate policy to deny public participation.

Taking it a step further, both were appointed by city council. Today, one would wonder that the reasons for disposing of Guelph Hydro, one of the most successful and profitable municipally-owned electric power distribution systems in Ontario. The exercise was not only demanded good faith and in the public interest but also explain the details and council’s rationale of the merger.

It was, in my opinion, the embalming of accountability and transparency.

Instead, council believed the siren song of selling out to a large private corporation that spun theories of futuristic benefits to the community. My favourite iste green fable was installing solar panels on every roof and a power storage system to hold surplus generated power to feed back into the grid.

Caveats, the homeowner must pay to install this system that is currently more than $15,000; and what happens if the sun doesn’t show up? What about the agreements with the Ontario Energy Generation Board that must be approved and signed?

In my opinion, it seems like a lot of work and money for citizens to obtain free or cheap electricity. Don’t we pay enough today in taxes and fees?

Wither $18.5 million od our money?

A final thought. As part of the merger deal, the city was to receive an $18.5 million special dividend from Guelph Hydro.

Dead silence. The unofficial information is that the city used the money to pay off the costs of the abortive District Energy nodes, installed in the Sleeman Centre and Hanlon Business Park and operated by the Guelph Municipal Holdings Inc (GMHI). Confirm or deny.

Also the dividends promised by Alectra will be deposited in a GMHI account. The question is, why?

Perhaps that accounting fitm KPMG’s consolidated audit of GMHI got it right when it posted a shareholder liability of $60 million. In this case the shareholder is the city council.

This may explain that the truth of the colossal financial failure of GMHI numbers may never be known or told to the citizens who paid for it.

 

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Is Guelph now the graveyard of public accountability and transparency?

By Gerry Barker

July 8, 2019

Opinion based on facts

Last Thursday, the final stage of the lawsuit brought by Mark Amorosi claiming I had defamed him was heard in the Wellington County Courthouse presided over by Superior Court Justice, Cynthia Peterson.

This was a hearing in which the court heard submissions from the two lawyers representing Barker and Amorosi. There was no testimony by the principals.

First up was Ian MacKinnon, lawyer for Amorosi. Over a three-hour submission, MacKinnon submitted evidence that Barker had defamed his client. He based his submission on sworn statements including a five-hour cross-examination recording consisting of more than 674 questions, of Barker.

During this submission, there were sworn statements attributed to Amorrosi, who was not present, that formed the basis of the lawsuit.

Amorosi, who launched his lawsuit November 16, 2016, attended the proceedings. He has claimed $400,000 in damages and $100,000 in exculpatory damages. He was reported in the Mercury Tribune that the city was paying his legal expenses.

It was stated by Mr. MacKinnon that Mr. Amorosi left the city two months following the lawsuit filing. In fact, CAO Derrick Thomson fired his friend Amorosi for cause February 9, 2017.

The termination was due to the leaking of some 50,000 private staff emails sent to the lawyer representing Building Inspector Bruce Poole. Mr. Poole was previously fired by the former CAO, Ann Pappert, and was suing the city for $1 million for wrongful dismissal. As this was part of Amorosi’s management portfolio, he was dismissed.

The subsequent settlement between the city and Mr. Poole was sealed and never revealed.

The facts of the handling of this case bungled by the Information Technology Department of which Amorosi was in charge, was another humiliating mismanagement by the administration, specifically Mr. Amorosi.

If not council, who signed off on those salary increases?

Moving on, Mr. MacKinnon told the court that Amorosi, in his sworn affidavit supporting his claim, that council did not approve staff salaries. All increases were in the annual budget.

The question is, if council did not approve that $98,202 salary increases given to CAO Pappert, Deputy Chief Administration Officers (DCAO) Mark Amorosi and Derrick Thomson, then who did?

If what Amorosi is stating in a sworn document, why was the closed-session of council ever needed?

During Barker’s lengthy cross-examination by Mr. Mackinnon in Mississauga last February, he was asked if he was aware that council did not approve staff. Barker replied that, it was the fiduciary responsibility of council to review and approve salary increases.

Mr. MacKinnon said that provincial authority stated that senior members of the public staff did not have to reveal salary data, including performance reviews.

He added that under the municipal CAO bylaw, only the Chief Administration Officer reviews and approves staff remuneration, including the senior staff.

That appears to be an attempt to curry favour with members of council who in the background are supporting payment of Amorosi’s legal expenses and supporting his lawsuit against Barker. To defend himself, Barker must pay his legal expenses from his personal resources.

It’s now ironic that former CAO Derrick Thomson abruptly left the city for unknown reasons. The 2018 Sunshine List showed Thomson’s salary was $335,000. That was an increase over his 2017 salary of $67,000. On March 18, 2019, Mayor Cam Guthrie announced the Thomson increase was in recognition of his role in the merger between Guelph Hydro and Alectra Utilities.

Historical evidence shows that former CAO Ms. Pappert was paid $153,412 for seven months when she was no longer employed. That tops Derrick Thomson’s $67,000 bonus paid for work done in 2017 and announced in March 2019.

Attempting to Destroy Barker’s credibility

Throughout his three-hour submission, Mr. MacKinnon accused Barker of making no attempt to request information from Amorosi who was in charge of city finances. He said Barker’s columns’ contents were false and deliberately written to discredit his client. He accused Barker of malice based on a series of posts that revealed details of the senior manager’s salary increases over 12 months.

These posts in 2016 said the increases were covered up for almost four months when the 2015 salaries were published at the end of March 2016.

What Mr. MacKinnon did not explain during the four moths of non-exposure of the increases, two of the three senior managers receiving the 2015 increases, Pappert and Thomson, had resigned.

It begs the question, why during the first six months of 2016 was Amorosi not selected to be CAO, even on an interim basis?

The fourth member of the senior management, Albert Horsman left the city in August 2015. Did he know that the senior managers were going to receive large increases for 2015? Allegedly, they were approved December 10, 2015 in closed-session conducted by city council.

In January 2016, Barker attempted to obtain the minutes of the December 10, 2015 closed-session council meeting. Four months later he was notified that his request was denied with no explanation.

More unanswered questions: When did CAO Ann Pappert decide to resign? In August 2016 the city HR manager told Coun. Cathy Downer that part of Ms. Pappert’s 2015 package included a $27,000 performance bonus plus another $10,000 in unused vacation and sick leave benefits, and sundry expenses.

Was this not an employee preparing to leave? She resigned two weeks after the 2015 Sunshine List was published and left May 26, 2016.

Witnessing Mr. MacKinnon’s performance, with statements that were hurtful, personal and a distortion of Barker’s motives, plus his methods of collecting facts, undermined Mr. MacKinnon’s arguments.

During Barker’s cross-examination, he was asked to reveal his contacts. Barker refused.

The defence of free speech

Barker’s counsel, Jordan Goldblatt, spoke chiefly about the laws governing free speech. He quoted case histories concerning other Strategic Litigation Against Public Participation (SLAPP). He outlined the rights of a citizen to criticize municipal administrations. Justice Peterson interacted with Barker’s counsel submission.

The case histories and the application of the Ontario legislation governing the rights of public participation focused on Guelph resident Barker’s right to comment. The two underlying burden of proof elements of the SLAPP legislation are what tangible damage was done to the plaintiff and was the subject matter in the public interest?

A decision on the motion to dismiss the lawsuit by Justice Peterson is not expected until September.

 

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How the Mercury Tribune rations online access to its website content

By Gerry Barker

July 2, 2019

Opinion

How low can the Tribune stoop to deny full access to its online news?

In all the years of working in the news business, I have never witnessed a newspaper reject access of its online content that has already been published.

Is it possible they are building a list of future subscribers?

Here is what the organization that owns the weekly newspaper demands before you can access content online. This is reproduced from the Mercury Tribune online website under the heading “Local News.”

Unless you aren’t registered to receive the complete story online, the following is posted on the Mercury Tribune’s website:

HEADING -Guelph could phase out vacant property tax discount by 2021Currently, vacant and excess commercial and industrial lands see 30% discount on property taxes

News Jun 26, 2019 Guelph Mercury

In a report to council, city staff is proposing to phase out the 30-per-cent property tax discount for vacant and excess commercial and industrial properties by 2021. – Dreamtime

Owners of vacant commercial and vacant properties may soon have to start paying the same tax rates as others in the city.

According to a report to be presented to councillors at their July 2 meeting of committee of the whole, city staff are recommending that the property tax discount for vacant and excess commercial and industrial lands be phased out over the next two years. (Balance of  the article is blanked out)

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Torstar is the corporation that owns the Toronto Star and Metroland Publishing that owns the Mercury Tribune. Now, you may ask, why is there an arbitrary limit to access the full article online, as published free every Thursday?

Am I the only reader who has reached his article limit? Perhaps the Tribune management should explain why the restriction online access is only to those who register.

This is a form of public information censorship that only one major advertiser would request.

The only advertiser who resen any criticism of its operations by gielphspeaks.ca is the City of Guelph administration.

The Tribune refuses to label the city administration’s weekly ads labeled “City News” when, in fact, it is advertising and not labeled as such. The kicker is that these “City News” ads are paid with public funds.

Now some of the “City News” content, as published weekly in the Tribun includes legal notices that are required to be published. It remains advertising and not news. Missing is the city logo. Wonder why?

But that does not excuse the city spending thousands of public funds to pretend the content is legitimate news. Perhaps the following Tribune statement urging readers to register to get their news online explains it:

“Please register to support the local, relevant news you need from a source you trust.”

Two words stick out from this statement, ‘support’ and ‘trust.’

Believe me, I know from personal experience that both those words can mean the opposite.

I can only comment about the Tribune statement using the expression, ‘support local, relevant news you need.’ It’s not only an untrue premise but a deceptive way to disguise the Tribune’s real intent to support the administration’s point of view.

This comes down to trust.

How can the thousands of citizens who receive the free ad-heavy Mercury Tribune each week trust the content? More important why is the city paying to print only one side of the story produced by the city’s communications department?

I know what it has cost me to defend my right to speak freely as outlined in the Canadian Charter of Rights.

It comes down to public participation in government affairs without the threat of litigation to prevent it.

This concerns every citizen to be able to access information and comment on it wuthout the threat of costly retaliation.

Opinions matter.

One final question to ask yourself: Would you have voted to merge Guelph Hydro with Alectra Utilities in December 2017?

Well, ten elected members of council did and that sealed the deal.

That was the most lurid misuse of the public trust that this city has endured in the past 13 years.

Trust is not just a five-letter word.

 

 

 

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