St. Albert Tatt/Ler

Servus Place public meeting disappoints

2008-03-12T10:25:00.006-06:00

Disapointing turnout

Disappointing is the best way to describe the public meeting last night held by the public advisory task force.

Disappointing mostly because of the lack of St. Albert taxpayers who bothered to turn out. What has caused the lack of motivation to be involved in mechanisms that affect your tax dollars and public decisions recently? Our just completed provincial election is a case in point.

Back to the meeting last night.

It is clear that the task force members are attempting to do as good as a job as they can.

2007 Budget used "plugged" figures

A few things were revealed last night that were surprising. The common thought previous to this meeting was "The solution is simple... get more members".

The "bread and butter" of membership is the fitness centre, and surprisingly, it already is at or near capacity. What this means, is that membership growth on the one identified money maker the facility has is highly unlikely. Should one question planning?

More revealing, and a subject this blogger has touched on in the past, is the variances between the original 2004 budget done by consultants, and that passed by the last council and prepared by the administration.

There is a massive $3.7 or 66% variance in pass holder sales between the more realistic 2004 budget and the one the administration developed in 2007. The expense side was reasonably close, but essentially figures were plugged just to make the whole situation look good. A larger population base than could be reasonably be considered was used, the penetration rate of sales was increased, as well as other what can at best be described as fictional figures were used.

Who is going to be held responsible for this? Were we sold a bill of goods by an incompetent, or worse, willfully deceitful administration?

Accouting adjustments proposed

It was clear that there was no way that Servus Place would break even at any time soon. What options were presented?

It was suggested that perhaps "costing" of services needed to be adjusted. What that meant in reality was unclear, but shifting costs to other city departments, possibly tapping reserves once again, and looking for taxpayers moneys in the form of senior government grants were all being proposals that were raised. Where these proposals came from were unclear, but the stamp of administration input is all over them.

Then we were presented with the warm and fuzzy proposal that citizens need to be aware of the "social benefits" that were estimated to be over $1 million dollars that should be applied to the deficit. What kind of oooga-boooga proposal is that? It was obvious that those who were responsible for the 2007 budget proposal were in full mode damage control and using whatever smoke and mirrors methods they could to "mitigate the damage" and the real deficit.

It is an insult to taxpayers in St. Albert to suggest that accounting adjustments will make the problem go away or lessen. It was suggested that because there was an unclear definition of what an "Enterprise model of operation" was, that such adjustments were justifiable. Two words come to mind, one which involves a horse, and the other the product of it's digestion.

What options are there for the centre?

We can keep it, close it, or privatize it.

Keeping it means that even with adjustments, taxpayers are on the hook one way or the other, no matter what accounting allocations are made. The question becomes is how transparent will those allocations be, and will anyone be able to determine the real deficits in years to come?

To close the centre is just not a realistic option, as even if it were to be mothballed, there would certainly be continuing costs to keep it from deteriorating.

To privatize it may have some appeal, but there is and will be a contingent of our community which will vigorously oppose that. There is another segment of our community which are prepared to pay even larger taxes, and that is a reality also.

The long and short of it is that no matter what option is pursued, there is no clean solution. Those that are most responsible for this mess need to answer for it, and city council needs to ensure that the same, at best misguided, decision making process is not repeated.

City Manager suggests we should not look back?

2008-01-18T10:30:00.001-07:00

Amazingly, Bill Holtby, City Manager for St. Albert, suggests in a recent TV interview that we need to look forward, and not backwards, on the whole Servus Place mess.

It has often been said that those who do not learn from history are doomed to make the same mistakes again.

Don Sinclair's Blog has a poll on this issue, available here.

It's confirmed - St. Albert most expensive in capital region

2008-01-12T11:06:00.000-07:00

To no one's surprise who lives in St. Albert, we have been confirmed as being the most expensive jurisdiction in the Edmonton Capital Region.

Quoting from an Edmonton Journal article of today:

"The city's total costs were also right in the middle of nine municipalities surveyed in the capital region, with Fort Saskatchewan ($4,187) on the bottom and St. Albert ($5,580) at the top."

The "total costs" is referring to a combination of property taxes and all utility charges.

With all the recent cost overruns, including Servus Place, the city will be hard pressed to address this.

A concentrated effort on 80/20 residential/commercial, a business friendly atmosphere at City Hall and a new look at reducing, not increasing expenses is required.

First Casualty in Servus Place fiasco

2008-01-11T23:13:00.000-07:00

Paul Moulton, the former Servus Place manager has resigned.

Although reports do not state any reason for his resignation, it does not take much imagination to guess why. It also does not take much imagination to suspect that his contract was either not renewed, or that there was a settlement arrived at with the promise of a good reference in any future jobs he may pursue. Mr. Moulton, after all, was a longer term city employee.

Whether this was the right move we won't know at this point, but it seems that with a number of reviews about to take place, it may have been more constructive to have Mr. Moulton participate in them.

It is perhaps natural to point at the person who most directly was involved on a day to day basis in the management of Servus Place. Perhaps this was the right move. Hopefully his leaving does not impede constructive investigation into the operation.

Some answered questions

2008-01-08T15:33:00.000-07:00

City council last night agreed to a terms of reference for a citizen's task force to be part of the Servus Place review. The only change was to in section (G), and that was to add the private sector operators as those to be consulted with. Only councilor Carol Watamaniuk voted against the terms of reference, as she expressed concern that it may be contrary to city policies to have citizens advise council directly, and not through a committee.

Bill Holtby advised council that these terms were drawn in only a short period of time late last week. We must give administration credit for doing a what I consider a good job on these, as I believe they are as comprehensive as one could hope for and expect.

What was clear to me from watching the council discussions on this issue is that the vast majority of council, and certainly Mayor Crouse, are genuinely concerned and upset about the situation, and want real answers to come out of the four reviews that will be happening simultaneously. Mayor Crouse specifically made comments with regards to Councilor Watamaniuk's concerns and her wanting administration to come up with a report on possible variances with city policies, Provincial regulations and "human resource issues". His comments were clear; citizens are concerned, answers are needed sooner rather than later, and he made strong comments about not delaying any action by adding layers of bureaucracy. His comments were echoed by some other councilors.

As much as I have been a critic of what has transpired in the past month, it is clear that council got the message. I also believe that the administration has got the message that citizens want and demand clear answers, no obfuscation and transparency from here on in.

It is a good start to the whole Servus Place mess and reviewing what happened, and more so, what to do to fix it.

How will City deal with Servus budget variance?

2007-12-28T14:33:00.000-07:00

Taken from the 2007-2008 approved budget:

The City is committed to achieving the budgeted projections and the overall philosophy that, by year three of operations, Servus Place will be operationally self-sufficient.

Forecasted revenue for Servus Place in 2007 is $6,768,500 and $7,545,400 for 2008. The facility is expected to have operating expenditures of $6,891,400 in 2007 and $7,323,100 in 2008.

We now know that this was a pipedream projection that will never be met under current circumstances. The city has a policy that specifically does not allow for any future tax levies to support any Servus deficit.

How does the City plan to deal with this? It is obvious that either they must change their policy, or Servus must miraculously produce at best a break-even situation.

The really important clauses in the policy state:

1. The Servus Place tax levy shall be the only direct tax levy support for Servus Place.

2. Use of the Servus Place tax levy shall be restricted to funding debt principal payments and interest expense on debt incurred for the initial construction of Servus Place; and Servus Place operating deficits for the 2005 to 2007 fiscal years. Servus Place tax levies charged after 2007 cannot be used to fund a Servus Place deficit, if any.

These are the City's own documents. They do have a problem, and my concern is that we as taxpayers are going to be the solution.

Is Servus trying to spend its way out of a deficit?

2007-12-27T23:20:00.000-07:00

Unbelievably, Servus Place is advertising for MORE staff, even though comments by City officials suggested all hiring would be frozen until the reviews are done.

Thanks Don, for the heads up. (This link is to Don Sinclair's blog and he found this bit of information.)

Council plan for Servus deserves some kudos

2007-12-26T16:19:00.000-07:00

I have been very critical of the lack of information and lack of clarity that has surrounded the problems at Servus Place.

I believe that council as a whole believes this is a serious issue that needs to be dealt with.

Although I reserve total judgment, I do agree that the 17 point plan council is looking at is a large step in the right direction. Transparency with the involvement of a citizens task force certainly helps address some credibility issue that have surfaced. It is their terms of reference which will be the telling story.

I am still very concerned of what will happen in the end. Will the peer reviews tell us that no recreation center, whether in Ft. Saskatchewan, Grande Prairie or Sherwood Park, can stand on its own? That is not what was sold to the residents and taxpayers of St. Albert by the administration in the past.

Will the consultants be actually listened to this time, and not forced to make changes so the reports "Tell the story we want it to tell"?

Finally, will the administration be completely open with the reviews that will occur? Will we have no more of the type of blame shifting such as we have seen on the software issues? Our mayor has said there are no sacred cows on this issue, and I believe that he means that. My hope is that information that is held within the bowels of City Hall is completely available with those so tasked in dealing with it.

The obfuscation starts... software was or was not the problem?

2007-12-26T15:53:00.001-07:00

From the December 26, 2007 Gazette:

"One point in fact Holtby admits needs clarification is that software issues prevented earlier reporting of Q3 numbers".

Huh?

So, earlier information on financial software being the issue was not correct? Interestingly enough, council was under the impression that was the problem. Oh, and so was the public.

Now, what does the Gazette report Holtby as saying?

"There was no one who purposefully or intentionally done anything to mislead city council or the public".

Whew! Am I glad to hear that! I would hate to have anyone even imply or think otherwise.

So maybe we should review some earlier comments attributed to the leader of our civic administration.

As reported in the December 5, 2007 Gazette,

"Holtby said incompatibility issues between Servus Place’s software and the system used by other city departments delayed third quarter reporting."

It is obvious that there needs to be a reconciliation between all of these statements. First of all, the software is blamed. Oh, then it was not the problem and no one suggested it was. Then we are told not to blame anyone for having said the financial software was the problem, that was not meant to be said. What really was meant to be said was that other software was the problem, to do with membership.

Now, all of these statements may be correct and true.

But do they all seem credible? Especially when we are facing a potential shortfall of over $10 million that we as taxpayers will need to make up?

Taxpayers insist on complete credibility and transparency. Both appear to be eroding.

Sticking with the facts, or "Don't sue this blogger"

2007-12-26T15:30:00.000-07:00

Veiled threats to bloggers

A recent editorial in the Gazette ends with, "... a word of caution to bloggers out there: you are subject to the same laws of defamation as any credible media outlet."

As a "credible media outlet", may I suggest that such language and any suggestion that it may encompass, is above the normal manner of operation of a "credible media outlet".

Whether new or enhanced information (or opinion for that matter) comes from a "credible media outlet" or from sources outside the mainstream media, such information is nevertheless of value, and it is surprising that a "credible media outlet" would lower itself to such utterances.

The Gazette has a long and well deserved reputation as a source of community information in St. Albert. I also suspect it will continue in that manner, and that any apparent deviances from it are an aberration and I would hope that future practices would show that it is an aberration. One would hate to see an award winning community newspaper tarnish its practices.

That being said, it also behooves a "credible media outlet" to look at issues critically, and ensure that all sides of an issue are presented. After all, one wants to maintain total credibility, does one not? Or perhaps, just perhaps, bloggers do have a purpose in discussions of issues in a community.

Servus Plebiscite... quit complaining, it's called democracy

2007-12-20T12:53:00.000-07:00

There has been much discussion about how the Servus Place plebiscite was "unfair".

No, it was not. A vote was held, eligible voters had their say, and the "yes" side won, albeit barely.

As much as I was bitterly disappointed with the outcome of the plebiscite, democracy is our rule of law. The fact is, that election had one of the lowest turnouts in recent civic elections. Whose fault is that?

I suppose the best lesson is that one gets the governance one deserves, as a group. I voted, I voted against Servus place as I could not see how it was sustainable, and my feelings have unfortunately been substantiated.

We can not really blame the council for moving ahead on the project. Many of them ran on the basis of supporting it, and others probably felt obliged to follow the results of the plebiscite.

Imagine the uproar if they had not followed a democratically held election?

No, the people one needs to be angry at for building Servus Place is the eligible voters who did not turn up at the polls.

All of this does not absolve the fiasco that has occurred since then. Those problems need to be addressed, both the operational ones, the fiscal ones and the personal that is responsible for either purposely giving false information or just as bad, being incompetent.

Council knew in June of ballooning Servus deficit

2007-12-16T13:46:00.001-07:00

As this copy of the City's administration's report to council (click on it to enlarge) as of June 30, 2007 clearly shows, it already then was apparent that there would be a large deficit at Servus Place. The magnitude of the deficit was not predicted at that time, but the report suggests that membership would continue to grow, and that expenses were as budgeted.

Questions clearly need to be asked and answered why earlier action was not taken before the latest revelations of the extent of the problem. Someone knew, and someone did not make moves to:

Correct the problem
Ask questions to update decision maker

City Policy does not allow funding Servus Place deficit

An even more interesting question is what the City will do with their Servus Place policy statement, which specifically reads that the City will not support any deficit in operations after 2007. For details on this policy, see this link. To quote from the policy, "Servus Place tax levies charged after 2007 cannot be used to fund a Servus Place deficit, if any."

Did Servus buy obsolete software?

2007-12-14T16:35:00.000-07:00

New information (at least to this writer) has come to light that suggests that the software that Servus Place used for their operations was obsolete when sourced, and in fact is not even supported any longer.

If this is the case, then it continues to raise the question, who knew what and when, and why, when it apparently was so important that the software is compatible with the City's, that an obsolete software would be purchased.

Any suggestion that this is only a small matter that will effect taxpayers by "pennies per day" is insulting to the resident's of St. Albert. Residents want to know why the apparent lack of competence was allowed to happen, and want to ensure that if there is a competence problem, that it gets rectified.

Servus Place, the $10 million "OOOPS... I did it again"

2007-12-12T17:14:00.000-07:00

Serious Fiasco

It is clear that the fiasco surrounding the operating deficits for Servus Place is serious.

How serious?

It is so bad that current projections mean a deficit of over $10 million dollars over the next 5 years. This is $10 million that will not be available for numerous other programs that need funding from the city, many of which may well be what residents have expected to be core issues.

This is $10 million dollars that if we do fund those other programs that need to come from increased taxes. It is not an issue we can go running to another government for and and ask them to cover it, this is homegrown and we are going to wear it.

Consultants were right, but who deceived us?

What makes me particularly angry is to find out that the consultants who were hired actually got it right when they advised what the expected membership would be and what population base it should be developed from.

Who is responsible for "bubbling" those figures to paint a rosy picture? And who is the body that should have had oversight? Who will be held accountable? Who lied to us?

This is NOT an issue that can be brushed under the table by trying to spin a story.

More problems... now it's accounting

The issue further gets compounded by citizens being advised that administration only found out about this growing problem recently because of "incompatibilities between Servus Place's accounting system and that used by the City".

I have a couple of words that come to mind, and they are somewhat more crude than "horse pucky", although the first word I would use is still "horse".

Who is the genius who can not take a balance sheet and profit and loss statement from one system and enter the results in another? Does it matter if one is run on Quick Books or Simply Accounting and the other on an Oracle database? We are being snowed even more then when the original consultant's report was altered.

Even if it is an issue, the City knew what system they were using, they knew which one Servus Place would use, so why was this not questioned when the Servus one was first set up? Who is responsible for that decision? Either we are continuing to be snowed, or there was gross incompetence when this was first set up. If it was so important to have compatibility between the two accounting systems, why did administration not insist on compatibility tests before the Servus one was set up?

Responsible parties need to be held accountable

This is a whole mess is a scandal that council needs to addressed, and now. Those that are responsible for misleading the citizens of St. Albert need to be terminated, and if there are any elected officials who are guilty of complicity, they should do the right thing and resign.

There are can be no excuses.

If there are severance packages that need to be paid, then so be it. Better throwing some good money after bad then the citizens being at risk for further deliberate deceptions in the future that would cost us even more taxes.

I am angry, and there are many residents I know who are angry. One can accept the city making decisions one does not agree with, but no one should accept being deceived by the city. This was NOT a simple mistake, this was deliberate.