Last November, I documented the unacceptably high number of closed-door (aka secretive) meetings held by this council since it took office. More than all of the past three councils combined. Back then I documented that by Oct. 2, 2017, council had held:
14 closed-door meetings about our airport
4 closed-door meetings about our hospital redevelopment
37 closed-door meetings about Collus-PowerStream (plus three potential that were vaguely identified in the agendas).
And in all that time, the number of comments or editorials in the local media about this abuse of power and egregious secrecy by our council: zero.
I thought I’d update readers on how many more of these secretive meetings have been held since Oct. 5, 2017. I have only included the airport and Collus (formerly Collus-PowerStream) sales because Saunderson and his Block accomplished their task by putting up enough roadblocks to the hospital’s redevelopment that it has been delayed by anywhere from three to ten more years (and under the current provincial government, it might be sunk entirely).
The headline on the media release reads, “Alectra selling its shares in Collus PowerStream to Collingwood.” What it should add is that Collingwood residents and taxpayers were betrayed by members of their own council and administration. After a three-year campaign to screw us, The Block have won a major victory in abhorrent behaviour. They are privatizing our electrical utility and next year will do the same to our water/wastewater utility, to the same corporation.
Our publicly-owned utility will be sold to EPCOR, an out-of-province, for-profit corporation that pays a dividend to the city of Edmonton only, and that will raise our electricity rates as soon as they are allowed. Our utility will be privatized within a year, with no local control, no local representation, no local input. And it’s all been done to us behind closed doors.
What will Collingwood get from the sale? Basically nothing, once all the legal fees, consultant fees, taxes and kickbacks are paid. We will have lost everything just to satisfy some personal vendettas.
In fact, with the changes made to staff, to departments and the termination of the shared services agreement, and the skyrocketing legal and consulting costs approved by The Block and this administration, operating costs are already escalating. Your taxes will be raised significantly to pay for their vile acts.
It is a devastating blow to the hardworking staff in Collus-PowerStream. It will be devastating and extremely costly to residents once the deal is finalized. This is the lowest moment in our town’s history. It goes way beyond merely being unethical and immoral: it has the stench of corruption about it.
Whether or not The Block sell our share of our public electrical utility to the for-profit, Edmonton-based EPCOR, it will still cost taxpayers millions. And I don’t mean just the rising costs of sole-sourced lawyers and buddy consultants the administration has hired (well over $1 million already, and the bills keep coming in). I’m talking about the hidden costs The Block won’t divulge because they don’t want taxpayers to realize how really bad a deal they’ve made with this devil.
And it all happens behind closed doors, Monday, Oct. 23, 2017. No public input allowed on the sale of our own utility. The Block intend to privatize our utility without informing the public of the costs or the consequences.
My industry sources tell me there are many costs associated with the sale that will be built into the selling price, but paid back to the buyer after the sale. In other words: it’s a shell game. We taxpayers will pay the buyer’s costs and their fees, but these will be hidden in the contract, which will be kept secret, so you won’t know what they really are. Sneaky and underhanded – The Block’s way.
Let’s start with the transfer tax: the Ministry of Finance applies a 22% tax to sales made to out-of-province buyers. So if the sale of the town’s share is $8 million as it was in 2012, the MoF will demand a $1.76 million transfer fee. But the buyer will probably offer more, an inflated value of, say, $10 or even $12 million, and the town will repay the buyer the tax from the total. So the town doesn’t actually get the extra cash: that pays the buyer’s taxes. Did I mention the shell game?
Then there’s the “break fee” or termination fee we will pay even if the deal falls through. This happened to Innisfil when its council decided not to sell InnPower to EPCOR (as I recall from media stories, the amount was $1.2 million, but I may be incorrect). Wikipedia tells us this is:
… a penalty set in takeover agreements, to be paid if the target backs out of a deal (usually because it has decided instead to accept a more attractive offer). The breakup fee is ostensibly to compensate the original acquirer for the cost of the time and resources expended in negotiating the original agreement. A breakup fee also serves to inhibit competing bids, since such bids would have to cover the cost of the breakup fee as well.
Which my industry sources tell me has already been agreed upon – in secret of course – by The Block and the town administration. We’ll pay it even if we decide not to sell. How much will it cost us? It really depends on what sort of slimy deal The Block cut, but again my industry sources suggest it will be between 8% and 13% of the offer.