Whistleblower complaint roils regional council
Gale pushes fact-free allegations about biosolids contract, a special Standard investigation has found
Niagara Region is spending more than $100,000 for a sprawling whistleblower investigation connected to its multimillion-dollar organic waste hauling contract, but the issue has become mired in political theatre and fact-free accusations of corruption that could lead to least one councillor becoming the focus of a code of conduct complaint.
This first test of the municipality’s never-before-used whistleblower policy could also trigger hefty lawsuits against the municipality if the existing contract with Niagara-based Thomas Nutrient Solutions is ripped up, the St. Catharines Standard learned during a three-week investigation into the matter.
At the heart of the issue are repeated accusations by Niagara Falls Coun. Bob Gale of improprieties with the process that hired Thomas Nutrient to haul Niagara’s biosolids. But in making those claims, including at a recent presentation to Niagara Falls city council, Gale mispresented how the contract was awarded, leaving out key facts, and openly discussed the complaint which, under the terms of the Region’s whistleblower policy, are supposed to be entirely confidential.
“All the whistleblowers have given me permission to talk,” Gale told the Standard in a recent interview.
However, the Region’s head of human resources, Franco Meffe, said the policy’s confidentiality clause does not permit flexibility to unmask any information about a whistleblower probe.
“We want to ensure and protect the integrity of the investigation ... and protect whistleblowers,” said Meffe. “A whistleblower cannot decide to release some information. The entire process is confidential.”
Gale’s claims before the city council also prompted acting Region chief administrative officer Ron Tripp to take the highly unusual step of issuing a memo to refute Gale’s claims.
The Standard has also learned from multiple sources within the Region that officials are considering filing a code of conduct complaint against Gale for breaching the whistleblower policy. A complaint can be filed by any member of staff, council or a member of the public.
In a statement, Region Chair Jim Bradley said the municipality would abide by its whistleblower policy provisions and not discuss specific details until the investigation is finished. Even then, some details may remain shielded from public eyes, Tripp said in an interview.
“It is my expectation that members of council will abide by both the Region’s whistleblower policy and their code of conduct going forward and refrain from providing any further public comment on this matter,” said Bradley’s statement.
“It is the Niagara Region’s intent to continue to treat this matter as confidential and provide no further commentary.”
Into the muck of the biosolids contract
Every day 35 tanker truckloads of organic waste are transported from water and wastewater treatment plants to a storage and processing facility, some of which is eventually distributed to farmers as fertilizer. Given the volumes of waste involved, service disruptions are not an option.
Originally, Region staff recommended extending an existing contract with Thomas Nutrient Solutions but cancelled it in October 2019 after a complaint by a rival company, Terrapure Environmental.
“In hindsight, if I knew then what I know now, I would have been handson, but I didn’t see this coming in the way it played out,” Tripp said about the recommendation to extend the Thomas contract.
“That’s not a slight against the staff that did the work. I might have seen what is now a little clearer to everyone. Regardless, there was nothing inappropriate, as stated by our legal department.”
Instead, council voted unanimously in January 2020 to use a competitive
process and issued a request for proposals, or RFP, while Thomas Nutrient operated under an emergency extension until a new contract was awarded.
Unlike the simple tendering process, through which the lowest bidder tends to get the contract, an RFP scores the technical ability of a prospective vender alongside the price. In this case, the technical review was 70 per cent of the score and the price was 30 per cent. Tripp said as a result, the lowest bidder does not always win a contract.
However, even before the method of choosing a new vender was decided, drama was brewing behind the scenes.
Gale said in December 2019, a month before councillors voted for the RFP, a whistleblower came to him.
“I was up at my office on Portage Road on a Sunday and a citizen stopped by,” Gale told Niagara Falls city council during a presentation on Oct 27. “He saw my car there, and he alleged improprieties around the biosolids and waste management staff at the Region.”
Another whistleblower, identified by Gale as a Region employee, contacted him in February, the same month regional council voted to hire a fairness commissioner to oversee the process and an industry expert to review the bid scoring.
On Feb. 10, the day before the vote on a fairness commissioner, every regional councillor received an anonymous email, sent under the pseudonym “Jamie Spencer,” that made unfounded allegations against Tripp and staff.
The email also claimed the contracting process was a “sole source” process and wasn’t transparent — claims later repeated without evidence by Gale, who denies having any connection to the author of the email.
Gale said a third whistleblower, who he also identifies as a Region employee, reached out to him in March, the same month the whistleblower policy was approved by council.
On April 6, Gale — joined by Niagara Falls Coun. Peter Nicholson and Fort Erie Coun. Tom Insinna and Tripp — met with at least one of the three whistleblowers.
Gale said he hasn’t had any “substantial” contact with them since then, and Tripp, Nicholson and Insinna have not publicly disclosed what was discussed.
Meffe said the municipality’s policy prohibits any contact with a whistleblower by Region officials once the investigation starts.
However, several sources familiar with the matter, who spoke to the Standard on condition of anonymity because they are not authorized to discuss confidential issues, said the complaints extend beyond the biosolids contract and stretch back a decade, involving allegations about former and current Region employees.
By late summer the Region hired Toronto-based forensic accounting firm Kroll Consulting Canada to investigate the complaints along with engineering firm CIMA from Mississauga to assist in reviewing “technical” aspects of the issues under investigation.
To date, the Region has paid Kroll more than $87,000. The Region has yet to be billed by CIMA, but Meffe expects the total cost of the probe “to be north of $100,000,” when it is completed.
The votes are cast
While Kroll began its work, regional council moved forward with the biosolids RFP.
There were three bidders: Thomas Nutrient, Terrapure and Wessuc Inc. Although Thomas Nutrient did not offer the lowest price, the company had the highest overall score. On Sept. 20, councillors voted 18-8 to award a four-year, $4.5million contract to Thomas Nutrient.
Although he believes the whistleblower complaints might have merit, Insinna, a former RCMP officer, voted to give the contract to Thomas Nutrient.
“I am a big believer in letting the investigative process play out. I have faith in the system that if something is wrong, it will come to light.
“If there is something wrong, we have the means to address it, and we will,” Insinna said.
The contract with Thomas Nutrient contains language that provides a way for the Region to back out, but councillors have received legal advice that doing so could open up the municipality to legal action.
Nicholson and Gale both voted against the deal.
The biosolids roadshow
On Oct. 24, Gale issued a motion demanding council jettison its legal advice and hire an external legal firm to review the contract.
“Something’s wrong, and even without the completion of the whistleblower’s investigation, it should have caused a reasonable person to step back and stop this,” Gale told Niagara Falls city council during his presentation a few days later.
During his presentation, Gale questioned why the lowest bidder did not win the contract, claimed it was a sole-source rather than competitive process, and that it was “unbelievable” the contract was awarded while the whistleblower investigation was underway.
In an interview with the Standard, Gale claimed “there is no transparency” in the process.
His speech won over Niagara Falls city councillors, who voted to ask Niagara Region to reconsider its biosolids contact and appear before them to answer questions.
“Hopefully, we can get to the bottom of it. Something smells,” said Niagara Falls city Coun. Chris Dabrowski.
However, Gale did not present a complete picture: He failed to tell city councillors about the fairness commissioner who signed off on the process as fair and transparent. He also neglected to mention the industry expert who reviewed how the bids were scored. And he also conflated a simple tendering process with the RFP procedure he voted in favour of.
Under the Region’s code of conduct, councillors are required to accurately explain council’s decisions. Gale’s omission of critical facts is under review by Region officials, the Standard has learned, and an integrity commissioner complaint is under consideration. They are also concerned that Gale’s misrepresentations of how the contract was awarded could trigger a costly lawsuit against the Region by Thomas Nutrient and the losing bidders.
The presentation also prompted Tripp to take the highly unusual step of issuing a memo — it was to be presented to regional council Thursday night, refuting Gale’s claims one-by-one. Typically senior staff do not fact check or single out a specific councillor in a report.
It also flatly rejects Gale’s assertion that the Thomas Nutrient contract should be torn up, saying it would be “inappropriate” to act on unsubstantiated allegations of corruption.
But Nicholson, who accompanied Gale to the meeting in Niagara Falls, doesn’t see anything wrong with the speech by his counterpart.
“Bob had about four or five minutes to try and get all the information out. It’s a complicated issue. I’m sure there was no intention to mislead anyone. Bob’s as honest as it comes. It shouldn’t be that controversial,” Nicholson said.
Bill Sawchuk is a St. Catharinesbased reporter with the Standard. Reach him via email: william.sawchuk@niagaradailies.com Grant LaFleche is a St. Catharinesbased investigative reporter with the Standard. Reach him via email: grant.lafleche@niagaradailies.com