The $9 Million Dollar Mayor

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Throwing money awayMore than eight million of your dollars have been spent to date on the Saunderson Vindictive Judicial Inquiry (SVJI), and it may top $9 million if you add in the costs the town doesn’t include in its calculations, as well as the proposed $700,000 report-about-the-report. And that should stick to our $9 million-dollar mayor.

There is a breakdown of the SVJI costs as of Dec. 18, 2020, on the town’s website. Sort of. The $8,098,547.40 total doesn’t include two key components: first, the salary and expenses of the inquiry’s judge. While that was paid for by the province, not simply by local taxpayers, it’s still a cost we all have to bear in our annual income tax paid to the province. Even the lowest provincial judges make at least $250,000 a year, so the true SVJI costs should be another $500,000 or even higher.

Then there are the unreported costs for town staff, too, and we do pay these: including overtime, time and paperwork to respond to and accommodate the SVJI requests, travel, time and paperwork to respond to residents’ questions and requests about the inquiry, time to set up rooms and hearing space, to provide water, electricity, and advice, to move departments out of town hall, then back again, for any incidental costs to accommodate the inquiry. How much that was I cannot estimate, but because so many senior staff were involved, I’d guess it easily tops $250,000 spread over the inquiry’s time here.

On top of that, there’s that $700,000 additional to be spent for staff to write a report about the report — a task we’re told is as important as ensuring our drinking water is safe. I’m sure you’ve already read my comments about that expensive, bureaucratic codswallop.

And we’re not sure if that’s the final tally or there are still bills to be paid. The town hall cash register keeps singing to the Nine-Million-Dollar Mayor’s tune.

Included in that $8M+ total is $1,432,686.77 for the firm of Lenczner Slaght, which is the employer of William McDowell, the town’s lawyer during the SVJI. That’s a lot of money for a company that was hired by the administration without a request from council, and without the requisite RFP, our procurement bylaw requires. Then the same lawyer who was hired to advise council on the judicial inquiry then was appointed the town’s legal representative, again without the usual RFP process or any competitive bidding.*

Sole sourced: the same procedure that Saunderson and his cabal railed against when the former council did it to build recreational facilities. The same procedure Saunderson promised in his election campaign would never happen under his watch.  Ah, the hypocrisy of our mayor.

And the report does not indicate whether this amount reflects the total time the lawyer was employed or just his time at the inquiry. If just the latter, the real costs for this sole-sourced contract will be a lot more than that.

Coincidentally, there was a 12-page submission from Tim Fryer — both former councillor and former CFO of Collus — on the consent agenda for the Dec. 21, 2020, council meeting. You can read it here and I recommend you do so, carefully. Despite some meandering and density, Fryer makes some interesting and important observations.** For example:

“…Mr. McDowell’s Feb. 26, 2018 report to council… was never publicly circulated… the idea of a [judicial inquiry] had not been mentioned to the public nor were any opportunities presented for direct public input on the topic.”

Of course, there were no opportunities for public input during the most secretive, deceptive council this town has ever experienced, not about the sale of our publicly-owned electricity utility, not about the sale of our publicly-owned airport, not about the publicly-funded SVJI. But since Fryer was also a member of that council, one has wonder why his criticisms of the secrecy and betrayals of public trust only appear in public almost three years later. Why didn’t he do or say something back then?

Well, it seems (page 11) he did, but didn’t say them publicly or raise the crucial questions about the process he documents in his letter. His final two pages are a list of questions about the then-current CAO’s report that seems to have been sent to the CAO of the day — good, hard questions I wish had been asked at the table in public (or by local media… if they were inclined to embarrass friends at the table).

At least we can read them today, albeit more than two years too late. Fryer notes his recent attempts to get information about the SVJI has been stymied by town hall (something with which I can sympathize):

I made official submissions but to date have only received partial results. Essentially it has been identified to me by municipal staff and provincial officials that there are confidentiality issues.

You can also read in his comments (p. 9) that someone apparently tried to prevent his questions and comments from being included on the consent agenda previously. Guess who approves what’s on the agenda? Right: our mayor. Nothing like openness and transparency from our elected officials, eh?

Fryer also notes that,

“… CAO Brown, had directed the consulting work that Mr. McDowell only first reported on to council in 2018. Brown had been a consultant about that report too. But the letter indicates that there was no input at all from him on the preparation of the crucial Staff Report T2018-06 Apr 30/18? This is the report that the 5 CJI supporting councilors, without any public input, utilized to establish a budget of $1.4-$1.6M. Although this quantum was more realistic than one of the CJI supporting councilor’s prediction that the CJI wouldn’t cost the Collingwood taxpayers $1…….it is well recognized now that it was woefully inaccurate… These collective concerns were never given any regards though, after a CJI supporting councilor’s prediction that once the discovery stage of the inquiry was completed it was expected that the scope of the investigation would narrow and that it was likely the final cost would be under $1M.”

Back then,  everyone at the table knew that a recent judicial inquiry in Mississauga had been estimated to cost about $1.2 million and subsequently blossomed to more than $6 million. The Mississauga inquiry report was circulated among councillors with a covering letter warning about the potential for escalated costs. And they also knew that there were enough similarities between them to assume the same would happen here. This was reiterated by the previous CAO who advised council that pursuing the inquiry could be very expensive. But who at the table wanted to hear common sense?

Five members of the previous council heard the report, discussed and planned the SVJI behind closed doors, when three members of that council were absent, and never engaging the public. But, as Fryer wrote, for those five Block members who voted to proceed with the SVJI, financial “concerns were never given any regards.” After all, why should they care about spending YOUR money?***

Fryer goes on to point out (on page 7) that the net amount received from the secretive sale of 100% of our electricity utility to an out-of-province, for-profit corporation last term was $16.5 million. When he deducts from that the cost of the SVJI, the costs of the inquiry to the sale ($1.2 million), and two spending commitments ($3.5 million for harbour projects; $2.5 million for COVID relief), he ends up with a mere $1.3 million from the sale. That’s how much that council sold our publicly-owned asset for. The same asset was valued at more than $25 million; we get about 5% of that. And as the costs continue to rise, maybe even less than $1 million will be left. Much less… with more than half going to pay for the SVJI itself.

Keep in mind that the 2010-14 council sold only 50% of its share in the utility, legally, openly, and with public consultation, and received $14.1 million, from which we built a new arena, upgraded and covered our pool for year-round use, and, from the remainder, we funded the widening of and upgrades to Hume Street. You can thank us for our community-minded accomplishments later.

There’s also a letter from resident John Megarry on the consent agenda, who complains about the lack of openness and transparency from this council about the costs and value of the SVJI. He notes,

The issues involved in the J I are so numerous, and so important, that a 5 minute public comment opening, buried in an unadvertised Committee meeting on a Staff Report, completely fails to meet Council’s supposed standard for transparency. Instead, this looks and feels like it is Council’s desire to lull the community to sleep on the entire issue.
I respectfully request that someone on Council propose a motion to hold a full, advertised, public meeting (necessarily via Zoom) on the subject of the Judicial Inquiry.

Similarly, Fryer closes his letter (p.10), with,

…I would reiterate that this council needs to ensure full access is open to the public. Otherwise unanswered questions will lead to unwanted further provincial involvement such as the type of external review that happened in the aftermath of the Mississauga Inquiry. Collingwood doesn’t need to have to utilize its already taxed resources to go through any of that.

An open, public meeting from the same people who sold our two public assets without any public consultation? Who discussed and decided to hold a judicial inquiry without any public consultation or discussion, knowing full well it would cost many millions of taxpayers’ dollars?  Who handed out sole-sourced contracts last term like party favours and held dozens upon dozens of secretive, closed-door meetings? Good luck with that request.

Collingwood deserves better.

~~~~~

* According to my sources, McDowell did not speak to or interview any of the councillors involved in the 50% share sale, nor to the utility’s board members, PowerStream employees or administration, Collus staff or administration, town hall recreation department staff, or Paul Bonwick before presenting his case for a judicial inquiry to council.

** Fryer makes another, salient point on page 1 about the decision to sell 50% of the utility to PowerStream instead of Hydro One, which had offered more money: there would have been a SIGNIFICANT increase in electricity costs under Hydro One. Fryer wrote:

It was outlined that HO distribution rates are approximately 25-30% higher than either COLLUS Power or PowerStream. The Ontario Energy Board’s Rate Calculator on their website is a very good tool to use to verify this.

So there would have been a major concern in regards to the long-term impact on ratepayers, who as taxpayers too, were essentially the shareholder of COLLUS electricity assets. To provide a quantum of the substantial impact, consider that Annual Distribution Revenue generated from COLLUS ratepayers is approximately $6.5M. Under HO rates then an additional $1.6M to $2M would be paid out annually, by not only Collingwood ratepayers but also those in the acquired areas of Thornbury, Stayner and Creemore. I note specifically about these areas, since the potential for significantly higher rates was a major reason that then Mayor Arthur of the Town of the Blue Mountains asked and received assurance from former Collingwood Mayors that Collingwood’s acquisition of the Thornbury assets and customers wouldn’t lead to an eventual resale of COLLUS’s assets to HO.

But, of course, our council Blockheads continue to whinge about not getting more money from that sale, as if money was all that mattered,  blithely ignoring the extra financial burden for residents it would have caused, especially for seniors and people on fixed incomes or earning minimum wage — the people our council seems to despise. And those same Blockheads ignore the fact that when it was a public utility, the town received an annual dividend from the utility. We got money that we didn’t have to raise taxes for. That ended when the utility was sold to a for-profit corporation (that none of the Block understood dividends was evident from their public comments about them at the time). Plus we lost local control over rates and level of service as we had previously. Selling it to a private corporation was a lose-lose situation for the town.

*** While local residents didn’t pay for their costs, let’s not lose sight of the unplanned costs — millions of dollars — incurred by other participants, including PowerStream, EPCOR, KPMG, the OPP, and Ed Houghton. The $8 million in the town’s report is only what we paid locally. The true cost of the SVJI is likely closer to $15 million if we include every player and participant. And some of those costs, like the OPP, will be borne by provincial taxpayers.

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