‘Actions taken’ on tunnel
City hall has already taken actions in response to the unexpected $2.1-million deficit from the railway tunnel project, Mayor David Henderson said.
However, when pressed for details, the mayor would not elaborate further on those actions, citing the need for sensitivity in relation to personnel matters.
The mayor made the comments at city council’s regular meeting as members quickly voted to accept a forensic audit on the matter.
City hall ordered the forensic audit in the wake of the tunnel restoration project’s unexpected deficit of nearly $2.1 million.
The auditors found that poor communication between the city and the volunteer committee spearheading the project, inadequate financial reporting and fundraising efforts that dried up a year into the project all contributed to the shortfall.
City council has since voted to cover the tunnel deficit in a new debenture issue totalling $2,749,901, which includes other capital work.
The auditors made eight recommendations:
* Clear terms of reference for “community-led committees” that define the roles of all parties involved, reporting structures, policies, spending limits and signing authorities;
* a representative from the city ’s finance department on the community-led committee;
* “formalized periodic financial reporting ”;
* the inclusion of any budget variances in community-led projects in the quarterly overall budget variance reports going before councillors, with a requirement that council be flagged if a project goes too far over budget;
* financial indicators to be used “as a point at which future activities on the project should be discussed”;
* not approving contracts “solely based on the offer of in-kind donations,” or if these are approved, having a “clear framework” to ensure these bids are lower than competitors’;
* requiring that development concepts for projects be submitted initially, “to establish the complete project vision prior to the initial budget establishment”;
* a review of conflict of interest disclosure policies and the way they are communicated.
Councillor son Tuesday approved without discussion a motion to receive the KPMG audit and refer it to staff for implementation of those recommendations.
Once the vote was done, Henderson noted city officials took the deficit seriously.
“It has been a long process,” said the mayor.
“There has now been a series of three different reports.”
They include the KPMG audit, the city’s regular annual financial audit, which placed a special emphasis on the tunnel situation, and an initial internal analysis.
“There have been some actions taken relative to those reports already,” added the mayor.
Asked later about the nature of those actions, Henderson declined to comment.
“Suffice it to say that some actions have been taken.”
Within a day of the city first receiving the KPMG audit in July, city council dismissed then city manager Bob Casselman.
Henderson at the time cautioned against drawing conclusions about the timing of Casselman’s departure and the tunnel audit. He said that the final week of July was the last time the council could make staffing changes because of provincial “lame-duck” rules, which influenced the timing of Casselman’s exit.
Brockville Mayor David Henderson speaks at city council's regular meeting on Tuesday.