Deception, The Block, and EPCOR

Spy stuffThe Ontario Energy Board (OEB) is currently conducting hearings about the proposed sale of our publicly-owned electrical utility, Collus, to the for-profit, out-of-province corporation, EPCOR. Several documents have already been entered into the record and you can read them here.

Most of them are fairly technical and steeped in opaque legalese, but download and read this one: EPCOR_IRR_SEC_EPCOR Collingwood MAADs_20180503.pdf. There’s some interesting content here and I think it’s stuff that The Block, the town and maybe even EPCOR don’t want you – the public – to know about. After all, The Block and town administration conducted this whole process in secret for three years – why would they want to be open about it now?

To start, turn to page 3. You’ll find a report on the profitability of Collus-PowerStream and its return on equity (ROE). Remember when we were assured by the Blockheads that it was a bad deal, it wasn’t successful, that the “status quo couldn’t continue”? Well look at the REAL numbers:

Please provide the achieved ROE (Return on Equity), calculated on a regulatory basis, for each year from 2013-2017, and file any forecasts of the Applicants that include ROE forecasts for 2018 and beyond.

Year/ Deemed Profitability/ROE:
2012: 8.01% /0.10%
2013: 8.98% /8.40%
2014: 8.98% /11.21%
2015: 8.98% /10.86%
2016: 8.98% /10.03%

Every year they operated as Collus-PowerStream, the utility had an ROE GREATER than 8% and almost 9% for most of those years. The ROE (which was understandably low the first year because it was partial) grew to more than 11% per year! That’s almost as high as the OEB will legally allow a utility’s profits to grow.

Here is what the actual OEB Scorecard for Collus PowerStream says:

Profitability: Regulatory Return on Equity – Deemed (included in rates)
Return on equity (ROE) measures the rate of return on shareholder equity. ROE demonstrates an organization’s profitability or how well a company uses its investments to generate earnings growth. Collus PowerStream’s current distribution rates were approved by the OEB and include an expected (deemed) regulatory return on equity of 8.98%. The OEB allows a distributor to earn within +/- 3% of the expected return on equity. If a distributor performs outside of this range, it may trigger a regulatory review of the distributor’s financial structure by the OEB.
Profitability: Regulatory Return on Equity – Achieved
Collus PowerStream achieved a ROE of 10.03% in 2016, which is within the 8.98% +/-3% range allowed by the OEB (see above paragraph). This is indicative of a healthy financial organization. This trend is expected to continue into the foreseeable future. The 0.10% result for 2012 was an anomaly year with a low net income, which was the result of the additional expenses incurred during the sale of 50% of the company’s shares to PowerStream.

Not profitable? Not successful? Even the sale application document says otherwise:

The 2017 deemed ROE is 8.98% and the 2017 achieved ROE, as filed with the Board in Collus PowerStream Corp.’s April 30, 2018 RRR filing, is 11.65% and remains subject to the Board’s review. The ROE forecast for 2018 and beyond approximates the OEB’s most recently approved ROE.

Would that my sad little RRSP returned half that percentage annually! The financial performance was raised again and again by The Block as a reason for the sale yet here it shows the utility was flourishing. Someone lied to the public about the financial situation. The judicial inquiry has to look into who it was.
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John Brown’s letter got the attention it deserved

WhingingIt went almost unnoticed, but on the agenda for the April 30 Collingwood Council agenda was a letter from the former interim CAO, John Brown, with eight questions (and some comments) about the CAO’s report on the costs of the upcoming judicial inquiry (item eight in the Consent Agenda portion). The letter itself is unsigned (see it here) but the agenda notes the author’s name. Not even the local media picked up on it.

It’s curious that not one of The Block bothered to have it pulled for discussion or request that staff answer the questions from their former mentor and – some say Machiavellian – advisor. One would have expected the slavish Blockheads to fight one another to rush to the defence of their éminence grise, and have his letter front and centre on the administration’s to-do list. Instead it was merely accepted “for information” and thus consigned to the dustbin. *

Consent agenda discussion starts at 3:10:47 in the meeting (video here). Only letters from Blue Mountain Watershed Trust got pulled for discussion. I suspect Brown must have been steaming when he watched that. Were these former sycophants throwing him under the bus? Why weren’t they tugging their forelocks and bowing as they had in the past? Could they be – gasp! – rejecting his influence at long last?

Let’s look at that letter and see what we can comment on. All quotations are taken directly from the agenda item with no attempt to change the nonstandard punctuation, spelling, capitalization, wording or spacing (despite my urge to correct same… I have written about his language skills in the past)

1 Why is this report submitted for council approval when not all members of council are able to attend?
-During my tenure as CAO the Clerk kept a record of all upcoming council member vacation plans and items of political sensitivity, such as the report this report , were always arranged for meeting when all members of council would be in attendance. Why not this one ?

Curiouser and curiouser. Only Deputy Mayor Brian Saunderson was absent from that meeting. My sources tell me he didn’t bother to inform the clerk, the CAO or the mayor of his absence; no one in town hall knew beforehand he wouldn’t attend. The agenda was released several days before the meeting and Brown’s letter was in it. How is it that Brown knew Saunderson wouldn’t be there so far in advance?

And why didn’t he similarly complain when the original motion was cunningly timed for Feb. 26, when the movers knew both Councillors Lloyd and Edwards would be absent for it? Surely that was even more important a vote, more politically sensitive an issue than this one? But he doesn’t seem to have noticed. Or cared.

(And you’ll note in the minutes that Councillor Fryer is marked absent for the controversial Feb. 26 vote – he was at the table, but conveniently got up and left the room when the vote was called, thus avoiding having to make a public commitment or a decision – a spineless action by someone who wants to be our next deputy mayor!).

Continue reading “John Brown’s letter got the attention it deserved”

Doherty’s Magic Money Fairy

the money fairyAt 3:55:20 in the video of Monday’s Collingwood Council meeting, Councillor Deb Doherty utters the self-congratulatory claim that she is “glad” the costs of the upcoming judicial inquiry to pursue the Block’s maniacal conspiracy theories are not coming out of “taxpayer funds on an annual basis.”

I can hear your head shaking. Where does she think money comes from? And since taxes are calculated yearly, is there any other sort of taxation aside from an “annual basis”? Well, read on…

This bit of financial wisdom comes from the same councillor who last year expressed bafflement over what dividends are and complained that the town wasn’t getting one from the utility to which it had caused excessive operating costs. This from a person charged with helping manage the town’s financial well-being.  Maybe she has other talents.

The costs of this inquiry were estimated at $1.4-$1.6 million in a staff report presented to council April 30. That estimate was vague because it didn’t include the costs of staff time to prepare reports, gather documents and appear at hearings, and possibly other expenses. A similar inquiry held in Mississauga was also estimated around $1.2 million ended up costing the municipality $6.2 million instead!

Doherty made her comment during a discussion on how to pay for the judicial inquiry that Deputy Mayor Saunderson demanded – without anyone (including him) bothering to figure out how to pay for it or even include it in the current year’s budget (Saunderson himself wasn’t at the meeting to answer questions, and my sources tell me he didn’t bother to inform anyone he wouldn’t be there!). So the costs get passed on to the next council (one that will, mercifully, be shorn of Blockheads).

Well, we all know finance has never been The Block’s strong suit. Or ethics, responsibility, openness, public consultation, fairness – but they are huge in conspiracy theories. Yuge, as Trump would say.

So how will the town pay for the inquiry? By taking the money from reserves. And how does money get into reserves in the first place? Yes, you’re going to tell me it gets funded from taxes which we, the taxpayer shell out every year. But clearly Councillor Doherty doesn’t understand that rather basic concept. I suggest she likely believes a Magic Money Fairy flies by at night and with a touch of her wand refills the coffers The Block have depleted.

As soon as she had uttered these words, Councillor Edwards corrected her, noting that “any money we spend comes from the taxpayers’ pocket.” *

True, but that apparently escaped Deb, who retorted that it wasn’t coming from taxpayers’ funds “this year.” So it seems no tax revenue went into reserves in 2018, at least in her mind. Need I tell you how utterly incorrect she is? Or that The Block initiated a fixed, extra 0.75% added to annual taxes to fund reserves? For which she voted? Which has been in the annual budget three times? For which she voted each time ? Okay, stop laughing.

It seems her Magic Money Fairy will simply fill up those reserves regularly so The Block can continue their spending-like-a-drunken-sailor-on-shore-leave-in-a-brothel tactic of financial management. While giving themselves a pay hike every year.

Continue reading “Doherty’s Magic Money Fairy”

The hypocrisy, it burns, it burns…

HypocrisyThe Block on Collingwood Council can’t seem to go a week without diving into their deep, private lake of hypocrisy. Remember how they whined and snarled about the partnership last council formed with PowerStream to own and operate our electrical utility? How the Jeremiahs at the table lamented that a partnership deal was bad for the town.

Now they want one for our airport. Ah, the hypocrisy.

Yep. A story in the Connection last week noted, “…the two best options for the municipality would be a full sale of the property or a sale that includes a private and public partnership.”

Partnerships were evil when the last council created them. Now The Block thinks they’re good. Hypocrisy is in their bones. They can’t help themselves. I suppose their remaining handful of supporters will say at least they’re consistent.

This is the same cabal that has been secretly scheming to sell the airport behind closed doors, without any public consultation, or engagement. Without even informing our municipal neighbours who are partners on the airport board (a Municipal Service Board created under special provisions in the Municipal Act). They never even discussed it with the people who work there or who have their planes at the airport.

But of course, the Block have never consulted, engaged or informed ANYONE outside their tiny circle about ANYTHING. That would be open and honest and run counter to their secretive, closed-door ideology.

And you, the taxpayer here, have never once been told why The Block are so intent on selling the airport. Or been asked if you agree with selling a publicly-owned asset. It’s all been decided behind closed doors. Secrecy and deception: the watchwords for Collingwood Council this term (14 closed-door meetings about the airport as of last November and one on Mar. 26 this year: 15 meetings behind closed doors and not a single public statement made to the public about WHY).
Continue reading “The hypocrisy, it burns, it burns…”

The costs of the Block’s conspiracy theory

Wasting our money$6.2 million. That’s how much it cost Mississauga to have a judicial inquiry into its utility Enersource, back in 2011. That inquiry was initially estimated to cost $2 million but the costs more than tripled, according to a story in The Connection.

Imagine what The Block’s judicial inquiry is going to cost us in Collingwood. Millions and millions more.

They’ve already admitted it will cost taxpayers around $2 million. But none of them have even the slightest idea of what’s involved, who has to be called, who pays what, or what the process is. They just swallowed the bait on the hook of the lawyer hired by the former interim CAO without hesitation. But then, none of them care about the costs because it will have to be paid next term, by a whole new council since no one in their right minds would re-elect a single one of this corrupt lot.

After all, it feeds their conspiracy theory – and like all such conspiracies is based on wild, alt-fact imagination rather than anything resembling truth. But it also helps them pursue their vendettas against former council and staff for not building the $35 million Taj Mahal for the Y at public expense. (Remember: some of these are the same people who cooked up the phony OPP investigation that found nothing wrong in five years – but still cost Ontario taxpayers millions to run).

The Mississauga inquiry interviewed nearly 100 people and collected about 35,000 documents and held hearings where 35 people testified over a period of 38 days. And cost the city $6.2 million.

Collingwood’s inquiry is going to be remarkably similar. At least 100 people were involved in the original share sale, including former councillors and many staff from Collingwood, former board members and staff of Collus and PowerStream, lawyers from municipalities and utilities, current Alectra staff and board, the KPMG’s consultant, auditors, the councils and staff of the three Ontario municipalities that were shareholders in PowerStream who approved the sale, our former CAO, our former interim CAO, reporters who covered the public events in local media, PLUS officials and staff at the Ontario Energy Board and Energy Probe who investigated and approved the deal. And some of the current council will be interviewed, too.

PLUS the town will have to pay the costs of lawyers, auditors and accountants who get called (and likely those of people who come from outside the community or interrupt their jobs to testify). There will be town staff who can’t do their work because they will be in interviews. There will be the costs to retrieve and print thousands of pages of documentation.

Thirty eight days of testimony? I doubt it will be any fewer for us here given the number of people involved in the decision last term. I have already spoken to a half-dozen people who are preparing thick dossiers and their paperwork, each of whom will have 100 or more pages of factual documentation and reports to present (my blog posts about Collus are at least that long!). I suspect our own inquiry will require 40 or more days.

Continue reading “The costs of the Block’s conspiracy theory”