City of Powell River’s chief administrative officer (CAO) has presented a report to council about lessons learned from the construction of a new barge terminal facility.
Mac Fraser told council at the November 15 meeting that the report is short, but important. “It’s an indication of the acceptance of lessons learned—things could have been done better—and an acknowledgement by the staff that we must learn from the situation,” he said.
The city-owned facility was relocated from Westview to Townsite on land leased from Catalyst Paper Corporation at the end of 2010 and early 2011, due to the south harbour expansion project. The city hired City Transfer Inc., the company that operated the facility for the city in the old location, to construct the new terminal.
Subsequently, a Powell River resident, George Orchiston, filed a complaint with the city’s auditors, BDO Canada LLP, against the city under Section 172 of the Community Charter. Orchiston alleged that city officials did not have “legitimate approval” of council to permit the construction of the new barge terminal facility. He claimed any city funds spent during 2011 “to facilitate and maintain this action, was unauthorized and improper.”
In a letter dated July 10, Bill Cox, a partner in BDO, stated the company had reviewed the information sent by Orchiston and other relevant information. “We report that, in our opinion, the transactions in question do not contravene the authority provided to staff and council under the Community Charter [and] no further action or investigation is warranted in regard to this matter.”
In two further letters, Orchiston pressed to have the full auditor’s report released. Council agreed and released a longer letter addressed to the city’s law firm, Lidstone and Company, and the city, dated July 10, 2012. It had a reference line that stated “confidential accounting recommendations.”
“Legal advice was sought on that,” said Fraser. “There was a pause because of my new arrival and in October council directed that this letter be put on the open council agenda, and it has been tonight, and likewise that I be directed to report on the lessons learned.”
Fraser provided a summary of his report, which began with a general overview of the situation. The issue, according to the auditor, was the procurement of services without appropriate documentation. “Staff will improve on that,” he said. “An amendment to the municipal purchasing policy will be submitted for council consideration to require the submission of all expenditure approval documentation to the finance department within one working day of the approval.”
The city did extremely well obtaining a great deal of infrastructure grant money over a two-year period, Fraser said. “It stressed us and things were done quickly in the name of expedition in service to those projects, but we’re realizing that some Ts weren’t crossed and some Is weren’t dotted,” he said. “The auditor did advise nothing was contrary to legislation or inappropriate. We’re taking the point that it could have been done a little bit better; the documentation was a bit rough and the coordination was a bit lacking.”
Other changes in procedure as a result of “lessons learned” include designating a senior manager who will be fully responsible to the CAO for the planning and operation of all municipal infrastructure projects. The manager will report to the CAO on project progress at least monthly and to council quarterly.
As well, the CAO and director of financial services will review all outstanding invoices once a month.
“I can give you confidence that no approval was given that wasn’t in the authority of the person giving the approval,” Fraser said. “But the documentation of that decision to approve was slow. It just should have been quicker. It was with authority, it just wasn’t properly documented because of trying to expedite and in this case rushing.”
BDO’s letter notes that the agreement in principle between the city and Catalyst resolves “most of the lingering issues related to the barge facility.”
After Fraser’s report, council passed two motions, to accept the report and receive the BDO letter dated July 10, 2012.
