The PowerStream deadline looms today

Our Council Blockheads at workBig day for Collus-PowerStream today: the deadline for acceptance of PowerStream’s sale offer for the remaining share of our utility expires this afternoon. And of course Council will finally deal with it at the special meeting called for noon, today, mere hours before it expires. Nothing like waiting until the last moment. They’ve had a month to deal with it, but that’s our council: inept and procrastinating until the end.

Like I wrote in December, if not accepted, this will trigger the shotgun clause in the shareholders’ agreement and force the issue (see below). Council could have avoided the deadline and the shotgun by simply agreeing to waive the right of first refusal and the shotgun clauses as PowerStream requested before submitting its bid, but no one in The Block was bright enough to realize the light at the end of the tunnel was an oncoming train.

The Block will be like flies stuck in amber: frozen by their failed ideology and innate stupidity; unable to respond effectively while the deputy mayor and the interim CAO try desperately to spin the issue as PowerStream’s fault instead of a debacle of their own making. That’s been the storyline fed to council and the public for the past two years and they’ll stick with it despite it having been exposed here as a poorly written fiction for a long time now.*

As evidence of their ineptitude, any bids for the share received from the RFP sent out last fall are supposed to be discussed at council’s January 20 meeting. Two weeks after today’s deadline. That’s a true Homer Simpson “Doh!” moment.

And if you’re a council watcher, you’ll recall the gormless Blockheads mouthing bromides about “kicking the tires” and “getting public input” – all the while scheming and conniving behind closed doors (where they will be, again, today). And now they’re stuck. They that sow the wind, shall reap the whirlwind. Ain’t karma a bitch?
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Collingwood’s own Gong Show, part 2

Keystone councilAs promised, here is the second part of the Gong Show analysis from December 12th’s council meeting. Like I said earlier, it’s perhaps more like a Keystone Cops or Abbott and Costello skit than the TV show.

As always, you can follow along on the Rogers Community TV broadcast, starting at 2:16:30. Laugh aloud at the zany, misinformed antics of your elected representatives as they fumble and stumble their way through an agenda of items they clearly have no clue about. You should start with part 1 of my review, if you haven’t already read it.

And by the end of this post you can decide which of these titles best suits our Blockheads:

  1. The Most Secretive Council Ever
  2. The Most Inept and Ineffective Council Ever
  3. The Most Devious Council Ever
  4. The Most Disrespectful Council Ever
  5. The Most Corrupt Council Ever
  6. The Most Underhanded Council Ever
  7. The Most Petty and Vindictive Council Ever
  8. All of the above.*

So first take a look at a letter that appeared on the consent agenda of the Strategic Initiatives Committee from Dec. 7 (SIC is one of those dysfunctional and inefficient council committees created by the interim CAO, yet embraced by Blockheads at the table with no experience in process or politics who prefer to flail and fumble rather that govern efficiently). See page 96 for the letter, which says in part:

Please accept this letter as confirmation that Collus PowerStream will not be renewing its existing computer rental agreement with the Collingwood Public Utilities that expires December 31st, 2016.
With regard to the existing equipment, the Board of Directors at our November 25th meeting authorized me to offer a one-time payment of $23,920.00 plus any applicable taxes for the attached listing of user workstation equipment and associated accessories (keyboards, mice, cables etc.) we are currently using and are interested in acquiring.
We ask that you please confirm acceptance of this offer by end of day December 15th, 2016. This will allow us sufficient time to make alternate arrangements prior to year-end for replacement hardware should the Town choose to not accept this offer.

Some key concepts here to keep in mind:

  • The board authorized the request and amount offered;
  • The agreement to rent equipment ends Dec. 31 at the same time the shared services agreement ends;
  • CPS needs to know by Dec. 15 and it’s already Dec. 12;
  • The offer is more than three times what the equipment is worth.

Simple, right? Apparently not for everyone.

Some history: Collus always provided the software and the technical support for the town’s computers as part of the shared services agreement. The agreement ended in 2014 but was extended until the end of 2016 so the interim CAO could present an update agreement. It still hasn’t been done.

The town (in this case the water department) purchased the hardware and rented/leased it back to Collus (later Collus-PowerStream, CPS) for just under $22,000 a year to provide a revenue stream to the town. With the unrelenting harassment of the utility and its staff by The Blockheads and the administration, CPS wants to get as far away from this viper’s nest as possible. CPS offered to buy the remaining hardware – mostly used notebooks, monitors, mice, cables and keyboards – from the town. And end another revenue stream to the town from the utility.**

used computersNow, keep in mind that this is all equipment CPS is using, not another town department or service. Whenever a department needs computer equipment, that department head purchases it. No department head has asked for any of this equipment, not least of all because it’s old and used and they can get new with a signature on a slip of paper.

And it’s all at least 3-4 years old (which means the laptops may not even be up to running Win 10) and may not be in the best shape after daily use for that time. Much of it would normally be replaced with new equipment in the next 12-28 months as per the town’s hardware replacement cycle.

But our Blockheads are apparently experts on IT, even though some of them can’t even configure their own home wireless without IT intervention.

And don’t forget: the shared services agreement to provide IT services to the town ends in January, 2017, before that vaunted mid-month report from the consultant. Second, the recent PowerStream offer to buy the Collus share has a deadline of Jan. 6. If accepted, there will be no relationship of any sort between the utility and the town. And if not accepted, PowerStream will invoke the shotgun clause and the whole shebang will unravel 30 days later.

This where the fun starts – be prepared to laugh and roll your eyes. And to shake your head in wonder at the pettiness of our Blockheads.

And then gasp in disgust at the backstabbing and deviousness that happened a mere two days later. Of course, you won’t read any of this in the local media. You’re welcome.
Continue reading “Collingwood’s own Gong Show, part 2”

Collus share bid received

My sources tell me PowerStream submitted a bid to purchase the town’s share of the Collus-PowerStream utility, late on Friday, December 9. While the amount was not stated, I am told it is a “very fair” bid. This is so far going as I predicted in my earlier post.

PowerStream paid $8 million cash for half the share in 2012 (with another $6.4 million coming through Collus from notes and recapitalization), but since then The Block and town administration gutted the board (twice), joyfully ruined the shared services agreement, and happily took away the water side thus reducing the utility’s revenue considerably. Done over two years of secret conniving behind closed doors.

IT services is hanging by a thread – town hall pulled the plug and secretly contracted (apparently sole-sourced without RFP or RFQ) with a Barrie company to do the work. And council approved Collus buying the remaining hardware so the cord has been almost fully cut. The IT relationship with Collus and the town is likely to be cancelled by January 1.

For many years, the town got exemplary IT service at a hugely discounted cost from Collus. The new contract with the out-of-towners will cost taxpayers tens of thousands more every year, but hey, it’s only money, right? Your money, of course, but what do our Blockheads care about you?

All that’s left is billing for the water side, still done by Collus, but thanks to town administration and our Blockheads, is about to cost you hundreds of thousands of dollars more a year when the share sale goes through.

Given the Block’s active and aggressive devaluation of the utility since the 2012 sale of 50%, I doubt the book value of the utility is more than $5 million now. However, PowerStream may offer more than that if for no other reason than to end the harassment and bullying and get away from the town as quickly as possible.

The deadline for the town to accept or reject the bid is, I believe, Friday, January 6, 2017, just under a month away. And that’s with the sword-of-Damocles shotgun clause hovering over their heads. Not very much time for a council whose term has been showcased by flailing inaction, and gormless dithering to make an actual decision. I bet the Blockheads do what the administration tells them to do, just like they always have.

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Stumbling towards the utility’s demise

The Return of ChanduThis week, Collingwood Council met in a special meeting to discuss an request from its utility partner, PowerStream, to waive some conditions of the shareholder agreement. This meeting appears to have been called by the interim CAO, which seems to me to usurp the mayor’s authority, but we know the administration – in partnership with The Block – has long been pulling the strings in this town to serve its own ends. Plus the meeting was held mid-day at the fire hall; a time and location that appears intended to deter both public and media presence.

Well while the public was deterred, the media were present, but nothing appeared in either paper. That doesn’t surprise me in the increasingly lax EB, but I expected better from the Connection. Finally, a story appeared in the online Connection, Friday. And it – as is too often the case with local media – doesn’t tell the whole story.

First read the waiver requested by Powerstream here. It asks the town to waive, “…Article 7, Article 8 and Article 9 thereof, for purposes of the Offer up until December 14, 2016.”

Got that? No, probably not. What it means is that PowerStream intends to present its offer early next week, but doesn’t want the offer to invoke terms in the agreement that would trigger the shotgun clause. And what, you ask, is the shotgun clause? Well, let’s do a quick review of the history first.

In 2011, the former council initiated a public process to explore opportunities to sell all or a portion (up to 50%) of our electrical utility. After several public information sessions in which public input and comment was sought, and after the issue was discussed in public at the council table, requests for proposals (RFPs) were sent out to prospective LDCs across the province. A strategic committee consisting of the utility board, staff, the mayor and KPMG Consultants was created to oversee the process and report to council and the public. All of the RFPs came in for purchase at EXACTLY 50%. No one wanted to buy less and the direction from council was to sell no more than half.

After a lengthy review and analysis of the offers, PowerStream was chosen as the winner. The offer was reviewed by their lawyers and accountants, our lawyers and accountants, the lawyers and accountants and council members of their three member municipalities. The process then moved to the Ontario Energy Board whose lawyers and accountants reviewed it. And then Energy Probe’s lawyers and accountants reviewed it. Everyone approved it, the finances were clean. The deal was sealed.

In the agreement were two important clauses. First, each side had the first right of refusal to buy the other half, should the partner ever want to sell its share. Second is the shotgun clause: should either party want to sell or buy, it can make an offer to the other party. If that offer is not accepted, then the rejecting party is bound to purchase the remaining half at the amount stated in the offer. And do it within 30 days.

So why did Powerstream want to waive these clauses? Well, first of all, the town sent out RFPs to several other LDCs in the province, totally ignoring PowerStream’s first right of refusal. Yes, it’s highly unethical and sure looks illegal to me, but that’s the way things are done here this term.

I suspect PowerStream – being an honourable company highly regarded by everyone outside our town hall – decided not to drag the bad faith shown again by our town into a legal battle which would further tarnish our badly tattered reputation. And one we would lose. Badly.

Second, PowerStream clearly wants to put its offer in along with those expected (or possibly already received) from the RFP, and not force the shotgun clause. In other words, to have its offer considered in context with the rest, not start the irrevocable process the shotgun clause will effect.

And guess what The Block did? Yep: they voted NOT to waive the clauses. The Block demanded 45 days to consider the request. Which is risible since the letter clearly states an offer is coming December 14, not sometime in February. 

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Those pesky costs The Block forgot to mention

Hidden costsWho sends out your water bills? Collus-PowerStream. It’s all part of the shared services agreement. Yes, that simple little agreement that for 15 productive, cooperative years linked our water and electrical utilities with mutual resources. That same agreement The Block dismantled and handed over to the interim CAO two years ago to rewrite and update. A 30-minute job that still hasn’t been completed. And never will be.

Who takes the data from the meters, calculates the charges, prints and folds the bills, inserts them into envelopes and puts them through the postage meter? Collus-PowerStream.

Who handles the automatic payments, the credit card and debit card payments, cashes the cheques and takes payment in person? Collus-PowerStream.

Who applies the payment it to your account and calculates any credit or debit? Collus-PowerStream.

Who answers the customer calls, explains the bills, makes changes of address or ownership to bills, opens new accounts, closes inactive accounts? Collus-PowerStream.

Who chases delinquent accounts and who works with customers in difficult situations? Collus-PowerStream.

Who banks the money and pays the town their share? Collus-PowerStream.

Our share of the electrical utility is about to be sold – YOUR utility – even though you never got even one chance to voice any say in the matter. It was all done in secret, connived behind closed doors with lawyers and consultants without any public discussion. 

Who pays for the cost of billing and mailing once the deal is closed? YOU will. Oh dear, did the administration neglect to warn you about this?

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552 kWh? We can do better

Power conservationI received a report in the mail from Collus PowerStream giving me an overview of my electricity usage for the one-month period of August. A hot, humid August that no doubt had us running the air conditioner and ceiling fans more often than we normally do (we actually like it warm most of the time).

I really appreciated getting the notice because we care about conservation. I always want to know more about our energy and water use, especially as the utility rates continue to escalate. Anything we can do to keep the bills low is something we examine carefully. I wish our water utility would do the same. *

For that one month, August, we burned 552 kWh (kilowatt hours). In comparison, our neighbours burned an average of 888 kwh each. But out more “efficient” neighbours only burned 395. **

Who these neighbours are is never stated. There is no demographic or other data to properly compare with. Are they full time or part time residents? What ages and do they have children? Do they own and use air conditioners? Do they have electric or gas heating? Electric stoves and dryers? What is the geographic range of the zone that defines them? What does the term “efficient” mean? All of these would help me understand my notice. The information doesn’t really let us compare our use against theirs in any meaningful way.

The annual summary on page two shows we were about the same usage last October (why then?) but we stayed below 400 kWh from then until July, when the heat and humidity soared. We were actually below our more “efficient” neighbours for five of those months and about the same for two. So for seven out of 12 months we were at the forefront of local conservation.

But what could we have done better? It’s hard to understand what we can still do. We’re very conservation-minded for both water and power and have done a lot already.

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