SO WHO'S BLUFFING? EBY'S NDP OR ATIRA?
Housing provider's response to audit seems to suggest it considers itself indispensable
Premier David Eby says he was taken aback by the response of housing provider Atira to the damning report on its relationship with B.C. Housing.
“I'm a little disturbed to see their press release that says that things don't need to change, because they do,” Eby declared on the morning after Atira's dismissal by news release of the Ernst & Young findings.
“Anyone reading that report knows that things have to change over there,” Eby told Simi Sara on CKNW radio Tuesday. “When you enter into agreements with government to do certain things and not do other things, you've got to honour those agreements. And that's not what happened.”
The New Democrats concluded “there is a need for a change of leadership at Atira, because of, frankly, the disappointing response to what certainly I see as a crisis of government confidence in that organization.”
The Atira board seemed to regard the Ernst & Young report as a vindication because no specific findings of wrongdoing or financial benefit were attributed to the organization's executive.
“What I would say about that is, `we'll see,'” Eby responded during an interview with Stephen Quinn on the CBC's Early Edition. “The forensic investigation was frustrated by an inability to access key financial documents from Atira.”
Atira now has consented “to allow government in to open their books for a full review to follow every dollar — and that is the right response,” Eby noted.
Until that process is completed to the government's satisfaction, B.C. Housing won't be funding any new projects with Atira.
Eby's disappointment was compounded by Atira's response to a direct letter from B.C. Housing board chair Allan Seckel, sent out a few days before the Ernst & Young report was released to the public.
Seckel demanded the “immediate” return of almost $2 million in surplus funds, provided by B.C. Housing and unspent by Atira.
The Ernst & Young report detailed how without B.C. Housing's approval, Atira had used $2 million in surpluses to purchase a single-room occupancy hotel at 303 Columbia St.
The May 4 letter also reiterated the government view that “leadership renewal is required.”
Atira board chairwoman Elva Kim wrote back the next day with a refusal to pay up, at least not immediately.
“Atira continues to hold those funds in restricted accounts, and we have been waiting for B.C. Housing to complete its review of the 2021 financial year before remitting those funds through the usual channels,” Kim wrote in a letter signed by herself and 11 members of the Atira board.
“Once we receive that documentation and complete a reconciliation, we will release any surplus to B.C. Housing.”
The Atira board was no less dismissive of the call for leadership renewal.
“We understand (it) to be a euphemism for terminating one or more senior executives. ... In light of there being no findings of wrongdoing by anyone on its executive, Atira's board will not terminate its senior executive team (n)or any of its members on request from B.C. Housing with one day's notice.”
Atira took two swats at the Ernst & Young report itself.
One: “You describe the report as a `forensic investigation,' but it was prepared under such abbreviated procedural and time constraints, we suspect it does not warrant that label.”
Two: “We understand it contains numerous significant factual errors and inaccuracies made by the unidentified authors.”
The summing up: “Your letter demanding changes and commitments from Atira with one day's notice, based on a report that we have not been able to fully access as a board, is problematic.”
I can't recall such a brazen response from a funding recipient to the government that provides 84 per cent of its budget. But the relationship is codependent.
B.C. Housing provides Atira with virtually all of its capital funding and operating subsidies.
Yet under the NDP government, Atira has also become B.C. Housing's No. 1 provider of housing.
When the New Democrats took office, they were expected in some quarters to clean house at B.C. Housing. CEO Shayne Ramsay was seen as too close to departed B.C. Liberal housing minister Rich Coleman.
Instead the New Democrats stuck with Ramsay for five years, believing that his experienced leadership was the best route to meeting their goal of adding thousands of units of social housing every year.
They also leaned on Atira to assemble enough hotels and motels to provide emergency housing for people living on the streets during the pandemic.
One ousted board member has described the scramble to find enough space, no questions asked, on “very strict marching orders” from the NDP cabinet.
So yes, Atira is brazen and dismissive. But the attitude is grounded in a cosy relationship with successive B.C. governments.
The NDP government has already ruled out putting the squeeze on Atira's existing funding for fear of hurting vulnerable tenants.
Perhaps Atira is betting the government that in the long run the government can't do without it on new projects as well.
Eby and his ministers have talked a tough line. But it remains to be see whether they will call Atira's bluff. Or whether it is they, themselves, who are bluffing.