Cronyism and decisions made for self-interest - those are the accusations being made by the Town of Collingwood’s lawyers in the judicial inquiry.
Each participant was invited to make closing submissions by the end of August. The 10 submissions have been posted on the Collingwood Inquiry website.
The closing submissions were related only to the first phase of the inquiry, which dealt with the initial sale by the town of 50 per cent of Collus to PowerStream in 2012.
The town’s closing submissions (approximately 100 pages) concluded by stating the sale process was “flawed and obscured,” and unfolded without “any meaningful oversight by town council.”
“It resulted in the loss of millions of dollars in potential revenue for the town,” states the town’s submission. “When public officials allow cronyism and their own interests to influence their actions, as happened here, public financial outcomes are compromised. This is measurable. It is harder to measure the erosion of public trust.”
The town’s closing submission makes four main accusations as a result of evidence and testimony that came forward in the first phase of the inquiry. Those accusations include:
- The financial information provided to the Strategic Task Team (STT) and council was inaccurate, incomplete, and misleading;
- The mayor, council, and town staff failed to understand their obligation to avoid conflicts of interest;
- PowerStream was given an improper advantage by receiving confidential information;
- And, a solar vent initiative involving Collus, PowerStream, Ed Houghton, and Paul Bonwick was presented to the STT and town as a reason to prefer PowerStream in the share sale.
“As a result of these improprieties, council selected PowerStream as its strategic partner rejecting an offer from Hydro One which would have generated more than $3 million in additional revenue for the town,” states the town’s closing submission. “This decision was completely uninformed. None of the town’s advisors explained the significance of this decision to council.”
The closing statement from Alectra Utilities Corporation - formerly PowerStream - suggests the evidence that has come out in the inquiry shows the share sale was “an extremely good deal for the Town of Collingwood,” and due diligence was undertaken by PowerStream and Paul Bonwick to address conflicts of interest.
“At the time it retained Mr. Bonwick as a consultant, PowerStream had no reason to believe that as a result, it would receive any information that was not appropriate for PowerStream to receive,” states Alectra’s submission, also about 100 pages. “From the outset, PowerStream took reasonable steps to address any potential conflict due to Mr. Bonwick working as a consultant.”
However, on the subject of receiving confidential information, Alectra suggests it could have played a role in stopping the flow of inappropriate information.
“With the benefit of all the evidence that was presented at the inquiry, it has become apparent, and PowerStream’s witnesses have candidly acknowledged that during the request for proposal process leading to the closing of the sale … PowerStream was provided with certain information that, in retrospect, it was not appropriate for it to receive,” states the submission. “PowerStream acknowledges that, at the time, it should have taken steps to address this matter.”
Alectra argues PowerStream’s deal with Collus led to many “tremendous” non-financial benefits for Collingwood’s citizens.
The closing submission states PowerStream was the “most logical fit for a strategic partnership,” due to its proximity to Collingwood, existing presence in Simcoe County, its size and community-based approach.
“Ultimately, the town of Collingwood and the citizens of Collingwood received exceptional value from PowerStream,” states Alectra’s submission. “The financial considerations received for the shares was well in excess of the fair market value of the shares and represented one of the highest premiums over book value paid for a local distribution company in Ontario at the time.”
Paul Bonwick, former mayor Sandra Cooper’s brother, and a consultant hired by PowerStream during the share sale, made his own closing submission (about 20 pages) stating “with absolute conviction” his efforts were always predicated on what he “believed to be in the best interests of the community.”
He also insisted the PowerStream deal was good for Collingwood, and his efforts toward transparency were “unprecedented.”
He claims in his submission he was never cautioned about the content of information he was providing to PowerStream, nor was he in meetings of the STT so he didn’t have an “appreciation of what Collus Power or the Municipality deemed to be sensitive or confidential information.”
In closing submissions by Fred Chenoweth, the lawyer for Ed Houghton, he argues the share sale process was “well-conceived and well-designed” and that it “achieved a successful result.”
Houghton was the CEO of Collus at the time of the sale, as well as the town’s director of public works.
Chenoweth further states the relationship between Bonwick and Houghton could not be “characterized as sinister or improper,” but that it’s obvious they would know each other in this “modestly-sized community.”
Furthermore, Chenoweth argues Houghton acted in the town’s best interest and not his own.
“Over and above the appropriate salaries and hard-earned bonuses, Ed Houghton received no personal benefit from the process,” states the closing submission, which was approximately 45 pages long.
Former mayor Sandra Cooper, who held office during the sale, also submitted a closing submission, authored by her lawyer, George Marron.
In the 78-page document, Marron argues Cooper did not violate a code of ethics, and she was fully-informed by a process she felt was “proper and appropriate.”
Marron also suggests Bonwick did not intend to disclose to Collingwood or any of its councillors or staff, including Cooper, any employment with PowerStream.
Watch CollingwoodToday for more on the closing statements.
Next week, hearings begin for Phase 2 of the inquiry which will focus on how the money from the share sale was spent, and who, if anyone, benefitted from those transactions.
