City staff and councillors are too cozy

We have not seen enough change on Hamilton city council.

Some members have been re-elected several terms. The same staff and councillors have worked together for so many years that, in my observation, the appropriate distance and independence required to make sound decisions is missing. Councillors are elected by the people and therefore their priorities should be those of taxpayers not staff. In my own experience, I made repeated delegations to Council’s A&A and GIC Committees concerning what I perceive as inaccurate information presented by the Director of Accounting Services. Although the GIC received my delegation and my rebuttal, they took no action.

Councillors do not have expertise in all fields and rely on staff recommendations. There are instances of inaccurate information being provided to Council, which, if corrected, could result in savings. The following examples will be of particular importance to new councillors as these are key questions that must be asked during budget deliberations.

The former city manager built up a staff of 120; human resources, audit services and 40 contract staff. To date, not a single council member has openly questioned this. Media and customer services staff have been built up. I have obtained information from the City of Toronto as a comparison. The population of Toronto is 2.9 million, compared to Hamilton’s 537,000, nevertheless, Hamilton employs 22 media and communication staff (one person for 24,409 residents) whereas Toronto employs 25 media and communication staff (one per 112,000 residents). Similarly, Hamilton employs 52 customer services employees (one employee for 10,327 residents) and Toronto employs 120 (one per 23,333 residents). The annual number of tourists to Hamilton is 4.5 million and to Toronto, 40 million. If the City of Hamilton has good leadership, it would reduce staff to more proportionately equal levels seen at the City of Toronto. The savings could be directed to other needs such as shoreline protection.

I raised the staffing issue with some councillors yet no action was taken. New councillors must take a fresh approach and question why we need such a large bureaucracy. The new city council will define the role of the new city manager. The new manager must have leadership qualities and have the ability to remedy current city financial affairs with the goal of diminishing taxpayer burden.

The City of Hamilton received cash of $132 million in 2002 when Hamilton Hydro, a city owned asset, merged with other utilities. The mayor at the time set up a Legacy Fund. A board of external civilians and a few councillors were to administer the fund, with power to approve or reject funding requests. The $132 million was divided between two types of funds, specifically, Future Fund “A” in the amount of $100 M and Future Fund “B” in the amount of $32 M. Financial accounting for the fund is provided by finance staff.

My concern is regarding Future fund “A.” This fund has financed Tim Hortons Field for $60 M. Various other projects have also been financed by the fund to the extent that the original $100 million of Future fund “A” has been fully committed to those projects. Nevertheless, staff continues to show that the Fund has a surplus. Staff justifies this presentation by adding loans receivable to the investment portfolio. They also show the receivables as earning interest and add the unpaid interest to the fund balance. However, the fund gave a one-time grant (not repayable) to Tim Hortons Field of over $55 million, and the fund has financed a forgivable interest loan, a property purchase, and a commitment of $100 million for the waste Management Master plan (the repayment of which is to be made by annual instalments). It is my opinion that there is a misrepresentation of the health of the Future Fund.

These are some of my concerns regarding financial issues at city hall. I believe a major contributing factor is the long and comfortable relationship between councillors and staff. This relationship exists because there are no term limits for councillors and no limits on contract length for city managers and senior staff. I believe that it is costing the taxpayers of Hamilton.