The high cost of departed senior city managers
Published posts relating to civic management since 2011. New posts changed twice a week.
By Gerry Barker
May 18, 2017
We learned this week that former Chief Administrative Officer (CAO) Ann Pappert is looking for a job according to an extensive online LinkedIn profile. Ms. Pappert left the city last May 26 for a new position as Assistant Deputy Minister in the Tourism, Culture and Sport Ministry.
That position lasted from October 2016 to February 2017. For whatever reason, she left prior to expiry of her six months probation. The 2016 Ontario Sunshine List shows Ms. Pappert received $263,757 from the city of Guelph although she only worked barely five months. The question is: What were the other benefits to which she could have been entitled? What were the terms of her contract? Such benefits could include pension, car allowance, unused vacation and/or sick time, travel expenses and insurance.
We do know that part of her package awarded in December 10, 2015, during a closed session by council, was reimbursement of unused vacation time, and a $28,000 retroactive performance bonus. Much has been written about that closed session but there has been no official acknowledgement or explanation why Ms. Pappert, Al Horseman, Derrick Thomson and Mark Amorosi were given such high increases.
The kicker is not one person in the entire Guelph administration said a word about those increases until the Sunshine List was published in March 2016.
The revelation ignited a wave of the four senior manager’s departures. Pappert left in May, Thomson resigned before the Sunshine list announcement to take a job with the Town of Caledon, Al Horsman left in August 2015, and Mark Amorosi left the city last February.
These four executives were handsomely rewarded by a gob-struck city council, in secret, not having the guts to tell the people who pay the bills. To this day the minutes of that closed session are locked up. I know, I tried to get them released. Turns out the special “Closed Session Investigator,” a city paid consultant from London took four months to even reply to my request. Their opinion is that the city acted according to the rules of the Ontario Municipal Act.
The thing that citizens should take away from all this behind closed-door handling of the public’s business is that our Mayor, Cam Guthrie, went along with it.
Today only Mr. Thomson remains the last of four top senior managers who, after resigning, was hired last June to take over the CAO’s job. Why wouldn’t he? His first year on the job will earn him $245,000 including a $9,900 car allowance. To his credit he went public with his base salary of $230,000.
There were some astonishing inclusions and exclusions.
According to the 2016 Provincial Sunshine list, former CAO, Ann Pappert, was paid $263,757.32 in 2016. Now you would assume that was for the year but Ms. Pappert left the city May 26, 2016, Seems like a lot of money for less than five months work. Why did she earn a $28,000 performance bonus? People earning performance bonuses don’t plan to leave, so why did she leave Guelph?
Checking the 2015 Provincial Sunshine list it showed Ms. Pappert was paid $226,060.96.
The only possible conclusion was that Ann Pappert was paid $489,818.26 for 17 months work as CAO, from January 1, 2015 to May 26, 2016. That works out to a monthly salary of $28,812.
At those rates, why did she resign when the Sunshine List revealed her increase in March 2016?
So while her provincial government job did not pan out there are still many unanswered questions about that December 10, 2015 closed council meeting. A total of $98,202 salary increases was awarded to Ms. Pappert, Deputy Chief Administrative Officer’s (DCAO) Al Horsman, Derrick Thomson and Mark Amorosi.
But there is more:
Former Chief Financial Officer, Al Horsman, left the city in August 2015. Today his name shows up receiving $188,999 in the Sunshine 2015 report, the equivalent of a full year on the job. Not bad for eight months work … in 2015. The question is, why did Horsman leave? He was deposed as CFO in the November 2014 reorganization of the senior management and switched to the Waste Management, Environmental Services and Engineering portfolio.
Former CAO Ann Pappert supervised that reorganization, following the 2014 civic election.
Horsman discovered the debacle of the deal made with the Rizzo brothers of Detroit to recycle material shipped from the motor city. The deal fell apart and was reported to have cost Guelph some $2.5 million. In December 2015, Solid Waste General Manager Dean Wyman, who was involved in the Detroit deal, left for a similar job in Edmonton.
DCAO Scott Stewart is now engaged in a rationalization procedure to discover and fix why the Waste management operating costs are losing $270.000 a year.
With Horsman gone, it left just three senior managers, CAO Ann Pappert, DCAO’s Mark Amorosi and Derrick Thomson.
Along with her duties as CAO, Ms. Pappert was also Chief Executive Officer CEO) of Guelph Municipal Holdings Inc (GMHI), for four years. As CEO she signed off the May 16 report along with her successor at GMHI, Pankaj Sardana. They jointly presented the report to council, acting as shareholders. It revealed that the city-owned GMHI was broke and had lost $26.6 million. Ten days later she left her job.
The unfolding story of GMHI leaves many questions to be answered.
Was Ann Pappert paid two salaries for her two senior responsibilities as CAO of Guelph and CEO of GMHI?
Why did two current Councillors, June Hofland and Karl Wetstein, both appointed to the GMHI board, not report to council about operations? The chair, former Mayor Farbridge, appointed them. Did they not realize that appointment carried specific fiduciary responsibilities to the public?
What was the role of Guelph Hydro in the Community Energy Initiative program?
How much did Guelph Hydro invest in GMHI in four years?
Why did Guelph Hydro loan GMHI $65 million without any collateral or expectation of repayment? (Note: It was revealed later the amount was $93 million in two debentures.)
How can GMHI give the city $9 million over four years in dividends and lose $26.6 million in the same period?
Were the GMHI financial books audited, if so by whom and when? (Note: Yes a consolidated audit was performed in 2016 by accounting firm KPMH)
What was the impact of Guelph Hydro bills to residents during the five year period, 2011 to 2015?
Will the city reveal the total wind-up costs of GMHI and when? (Note: that has not occurred as yet.)
How do GMHI’s financial costs and losses impact the sale of Guelph Hydro? (Note: that has not yet been determined.)
Is a potential Guelph Hydro sale to pay off these GMHI losses and clear the city books of the debt?
This is the result of misuse of political power and mismanagement of city resources.
The closed session meetings, regardless of what the staff says, are nothing short of secret manipulation of events and decisions. Much of it is political because the city has been held hostage for the past ten years by the political left, supported by the powerful labour movement.
If the majority of citizens don’t complain and demand answers from their elected representatives, then nothing will change. Property taxes will continue to grow exponentially annually. The same will happen with user fees.
The fall-out is that we allowed a CAO to leave this city after receiving more than a million dollars after just over five years on the job.
We can only blame ourselves for allowing it to happen.
Our only chance for electing responsible and experienced councillors next year, to clean up the financial mess the city is in to reduce the operating overhead, restore the reserves and demand performance of the professional staff.