Another Collus conspiracy debunked


Bad newsAs a former reporter and editor, I always feel a twinge of satisfaction when I read a well-written story in the local papers that gets all of its facts right. When everything is stated correctly, the English is good, the facts well reported, the reporting unbiased and everything clearly posited. It just makes me beam.

Sadly, I haven’t felt that joy for a few years now. I too often feel our local reporters are on cruise control, and don’t work very hard at getting their stories right. They are too quick to swallow the propaganda issuing from town hall or from their ideological buddies at the table. And fact checking? Local investigative journalism seems to have gone the way of the VHS and 8-track.

This week’s bog-paper story appears in the Enterprise-Bulletin, titled, Power deal remains up in the air.

Collingwood CAO John Brown reported to council this week that despite best efforts of the town’s lawyer, PowerStream has still not responded to the town’s request for satisfaction on the working of the shared services agreement.

As you, dear reader, know, this is codswallop. My sources tell me that every request for information – and there have been many, often the same one sent over and over and over and over – has been fulfilled: reams and reams of papers have been supplied to town hall.

Except, of course, for personal, confidential and legally-protected data on employees’ salaries. Which the administration continues to demand for no logical reason. It certainly has nothing to do with the shared services agreement. Saying so has always been a thin ruse to justify the intrusion into confidentiality.

In fact, the previously appointed members of the Collus-Powerstream board – an experienced, respected group of professionals – were summarily fired and replaced by pet staffers with no experience or knowledge in the electricity sector (in violation of the town’s own procedural bylaw…). They were chosen solely to get that information for the Block who want to share it with their buddies and bloggers like school children sharing salacious gossip.

Then the staffers who replaced the board snottily refused to sign a standard non-disclosure agreement promising not to share confidential information with non-board members.

Like I said, readers know this has all been merely a part of the Block’s ongoing vendettas, fuelled by personal agendas and conducted in secret while the group labours to sell YOUR utility without any public discussion, let alone input from you, the taxpayer. But let’s return to the article.

More surprisingly, Brown told council that a number of staff from Collus Solutions has been transferred to Collus PowerStream.
“It has come to my attention as CAO that certain key staff of Collus PowerStream Solutions Corporation may have been transferred from that company to work for its parent company, Collus Powerstream Utilities Corporation,” Brown said to council.
“It may have occurred as early as May of this year. I find it strange that such a large scale out of Collus Powerstream Solutions without the town being advised.”
The town has major financial interests in Solutions and that a transfer such as this would have a major impact on the ability of Solutions to operate, Brown continued.
Brown could not confirm the information.

So he can’t confirm anything, but yet he will make a public statement about it? This at the table of The Most Secretive Council Ever? Come on… don’t you smell a rat?

Well, let’s dig up some history, shall we? Here’s what the reporter (conveniently) didn’t mention, and probably never bothered to ask about. But curiously, the utility’s former CFO – now Councillor Tim Fryer – knows all about it. He helped set it up, but yet he didn’t bother to inform council (and the public) about it, or correct the misrepresentations. Think maybe there’s some personal reason for Tim not being open and transparent? Me too. Ah, so much for openness and transparency…

Collus Solutions (CS) was created in 2000 as a shell company. It is wholly owned by Collus PowerStream (the town has a share in CPS, but not directly in Collus Solutions). It has no physical assets and its financial assets at the end of 2015 were under $130K. It may still be owed money by the town.

It only exists on paper. It is merely an accounting convenience. Employees who provided the shared services to our water utility and other town departments were placed in CS to simplify the accounting process. As the auditor’s report notes,

The principal activity of the corporation is to provide management, administration, billing, collecting and information technology services to Collus PowerStream Corp., Collingwood Public Utilities Service Board and The Town of Collingwood.

Solutions was part of the share sale to PowerStream in 2012, mostly because the employees in it also worked for Collus. Plus, the shared services agreement represented a revenue stream.

A letter recently sent by Collus PowerStream to the town administration and council explains it all (too bad the EB never called anyone at Collus PowerStream to get an explanation after the council meeting…). Here’s a quote from the letter (read it all here):

As a result of conversations with CAO Brown, Collus PowerStream was advised that the Town was “transitioning” its IT services to the Town. As a result, two IT employees and a GIS employee would no longer be required in Collus Solutions. At our Board Meeting on May 31, 2016 our VP of Operations presented a staff report about our IT operations. One of the report’s recommendations, approved unanimously by the Board, was to move existing IT and GIS staff to Collus PowerStream from Collus Solutions. This does not preclude Collus PowerStream from continuing to provide IT and GIS services to the Town pursuant to the Shared Services agreement to be signed by the Town and PowerStream. In fact, since January 1, 2016 the three employees have continued to perform the shared services for the Town under the premise that the agreement will be executed.

This council and its administration dismantled the cooperative, efficient and mutually-beneficial 150-year-old arrangement between our water and electrical utilities early in its term. The Block – NOT Collus PowerStream – strangled the revenue generation by removing employees and services from the joint agreement. So the benefit (and revenue) of Solutions to the utility shrank accordingly. And as the auditor’s report stated:

As the corporation’s main source of revenue is derived from providing administrative services to related parties its ability to continue viable operations is dependent upon Collus PowerStream Corp. and Collingwood Public Utilities Service Board. The shared services agreement is currently under review and the impact of any changes to the agreement is unknown at this time.

The viability of Solutions is dependent on the shared services agreement. Without services to share, it is nothing. Which agreement The Block has dismantled this term and let the interim CAO hold in abeyance for the past two years. And they’re blaming someone else for the mess they created. Don’t you just love the accountability?

By 2016 most of the employees working as Solutions employees were really only working for Collus alone. They had nothing to provide to the town or the water side (you, the taxpayer, are paying for those now not-shared services and employees, but that’s okay since your money grows on trees…). So they were moved under the Collus umbrella because, after all, that was who they worked for.

By the spring, the only people left in Solutions were two IT employees, one GIS worker and five customer service/billing reps. All the other services had been taken away by the town (which makes you wonder again why the town’s administration has not been able to craft an agreement for the remaining service in two years when it should take at most about 30 minutes…). So enough with the hypocrisy: billing was all that was left for Solutions to supply.

The town has been secretly working to take over IT, move all the equipment to the fire station, and contract the service out to a local, private company*. At a much higher cost than Solutions ever charged, of course. Plus there’s the enormous cost of moving the hardware and rebuilding the infrastructure and wiring in the fire hall to handle the servers. Hey, it’s only YOUR money, so why should the administration care about the costs?

But wait, it gets better: as the letter states, the interim CAO TOLD Collus-PowerStream that it was doing all this and wouldn’t need the IT employees (without any public discussions, mind you) back in the spring. Now, six or so months later, the interim CAO is making as if it’s a big surprise to him.

Moving employees from Solutions to Collus PowerStream was simply an administrative move. The former board was fully aware of these activities. And since the mayor sat on that board, too, through her the town was informed and participated in the decision.

And no, there is no obligation to tell council or the town administration every movement of employees who work for a separate corporation. That’s just The Block’s and administration’s obsessive desire to micromanage every little detail of the town. And destroy as much as they touch.

That’s it in a nutshell.

No conspiracy, no subterfuge, no hidden agendas, at least none on the part of Collus PowerStream. On the part of council, well, that’s another matter.

Collus PowerStream knows the town has no intention of signing a new shared services agreement (why would they, since they’ve spent hundreds of thousands of your tax dollars to dismantle the relationship, and sent out RFPs to various utilities trying to sell their share without public input?). Yet we keep getting “progress” reports that say nothing. May the farce be with you.

Then the Deputy Mayor, Brian Saunderson, pipes up, playing a scripted Costello to the interim CAO’s Abbott:

“Are you telling us that because of confidentiality restriction on a board member that significant corporate changes can be made and we as 50% shareholders would not have been told of structural changes or operational changes?” asked Deputy Mayor Brian Saunderson…
“To be clear then, the operational changes, presumably it could involve all of our Collus PowerStream staff to the point that it is now a shell company not an operating company, and that type of change in the operation of a company doesn’t require notification of a shareholder,” said Saunderson. “It seems unusual.”

I think it’s “unusual” that a lawyer doesn’t know all about the province’s corporate and confidentiality laws. And the responsibilities and authority of an independent board under the OEB’s rules. After all, anyone with an internet connection can look them up online, not just lawyers. But maybe they’re teaching different subjects in law schools these days. Like macrame or flower arranging.

But no, Brian, this doesn’t change Collus PowerStream nor will it make it a “shell company” as you suggest. What an imagination you have! You ought to take up a career writing fantasy and get out of that fusty old law office. But Collus Solutions is already a shell, and may soon be de-populated entirely, thanks to the efforts of you and your friends at the table

Or maybe it was a carefully planned set up to continue foisting the conspiracy theory on the public. Oooh, bad Collus for not telling us it was protecting its employees and insuring they have jobs and can pay their mortgages and feed their families. Bad Collus for doing what a responsible corporate citizen should do. Bad Collus for not letting us ruin their lives intead.

Too bad the EB didn’t dig deeper. Or at all.

The interim CAO responded:

“In terms of the Shareholders (sic) Agreement that it’s generally the context that we generally work together with our 50% partner and I think that I would advise council that the town approval is required,” said Brown.

(Huh?) The interim CAO apparently advises that, contrary to policy for all other boards and committees, and against provincial corporate legislation, council gets to approve minor staff changes in an independent agency it doesn’t even own direct shares in. Horse puckey. As the CPS letter to council stated quite clearly:

Collus Solutions has no financial assets, it strictly houses employees that perform shared services. Employees are transferred out of Collus Solutions to Collus PowerStream if and when they no longer perform any services for water or Town operations. These transfers do not require the approval of either shareholder as it is strictly an administrative matter and seamless to the Corporations.

Does council approve moving staff from one department to another in the library? Or override library board decisions? Does council have to approve the schedules at the museum? Or who the NVCA hires? Of course not. Yet apparently council should approve changes at Collus Solutions and override the decisions of the independent corporation’s own HR department and its board.

And none of this is in the article. How the mighty EB, once the local paper of record, has fallen.

As for the Collingwood Connection, it posted a somewhat better story titled Collingwood, PowerStream still working on agreement despite contention. Well, we know that’s not true: after two years, an agreement that could have been updated in 30 minutes has long been belly-up in the political waters. What’s left to share? Despite this, the reporter wrote:

The two sides are in the midst of negotiating a new shared services agreement, which would see Collus Solutions, a subsidiary of Collus Powerstream, provide a variety of services for the municipality.

“Variety” means what? Right now, the town is secretly but actively trying to recruit the private sector to provide IT services (to which the GIS service is closely tied). Only the billing staff are left. Some variety.

The town taxpayer has shouldered the costs of the other previously provided services and faces considerably more to come. However, as a show of good faith and an interest in maintaining the greater good for all of us, Collus PowerStream continues to provide IT services despite the lack of the shared services agreement, as the letter from Collus PowerStream states:

In fact, since January 1, 2016 the three employees have continued to perform the shared services for the Town under the premise that the agreement will be executed.

But this next bit is interesting (kudos to the reporter for actually asking someone at PowerStream and not merely drinking the administration’s Kool-Aid), when the reporter quotes from a letter by lawyer Jean Leonard:

“The last communication I received from them was on July 25 when I was advised that they were seeking instructions and would get back to me,” said Leonard. “My follow up email has gone unanswered.”
Eric Fagen, vice-president of corporate communications for Powerstream, claims there has been communication between Brown and PowerStream President Brian Bentz.
“Since then, there have been a number of email exchanges between our president and John Brown, so there was a dialogue going on there,” he said.

The lawyer tells council and the public there have been no communications since July 25. PowerStream says there has been an ongoing dialogue with the interim CAO. Are we being misled by someone? Why didn’t the interim CAO mention this? Or forward the emails to the lawyer? Perhaps we should file an FOI request to see the interim CAO’s emails.

The story quotes more from Leonard:

Leonard said these transfers could limit the ability of Collus Solutions to operate.
“The Town has a financial interest in Solutions, as a 50 per cent shareholder through the parent company, and this financial interest will be impacted if Solutions is unable to carry on its business,” she said.

Do I need to state the obvious here? Many months ago, the interim CAO told Collus PowerStream the town was taking over its IT services (so you, the taxpayer, would shoulder that increased burden…). Of course, this has never been made public by The Most Secretive Council Ever. To reiterate, the letter from Collus PowerStream noted:

As a result of conversations with CAO Brown, Collus PowerStream was advised that the Town was “transitioning” its IT services to the Town. As a result, two IT employees and a GIS employee would no longer be required in Collus Solutions. At our Board Meeting on May 31, 2016 our VP of Operations presented a staff report about our IT operations.

So how could transferring the IT and GIS employees – who won’t be needed by the town fairly soon – possibly affect the business of Solutions? The town plans to sell those IT services to the private sector (at your great expense). Come on, even a lawyer has to recognize that the spin is flaccid.

Collingwood deserves better.

* This contracting out of IT services concerns me for a reason aside from the increased costs taxpayers will carry from the debacle: security. A considerable amount of confidential and personal information is maintained in the town’s records, emails and databases. Will this be secure? Will it be protected? Or will it leak (as has so much already, this term)? I trust the current IT staff – but who will guarantee our data is secure in future, once it is in private hands?

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