LORINC: Waterfront Toronto two steps ahead of Minnan-Wong’s forced outrage

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One of the great fictions of the Rob Ford era is that only a tiny clutch of politicians kept watch over all the devious civil servants and special interests who were busily feather-bedding at the expense of the ordinary working person.

“But for my eagle-eyed diligence,”  as this self-serving stance has it, “tax dollars would vanish into black holes, bank accounts in the Caymans, etc.”

With the muting of the Fords and the departure of Mike Del Grande from council, the last devoted practitioner is deputy mayor Denzil Minnan-Wong, who made his debut at yesterday’s Waterfront Toronto (WT) board meeting.

Minnan-Wong, now a director, has claimed repeatedly that WT is a Kremlin-like body that actively prevents duly elected officials from getting the real goods. The most recent opportunity for his outrage presented itself last week, when the agency revealed it had gone more than $36 million over-budget on the remake of Queens Quay West, now expected to come in at $129 million, up from $94 million.

“I think they had an obligation as a public body to disclose that information,” he told The Globe and Mail last week. “They’re far too secretive of an organization. Too many things get discussed in private. They just close the doors – they disclose that information to the board, and the public never knew.” Mayor John Tory backed up Minnan-Wong, saying he was “concerned” with the agency’s lack of transparency.

The obvious sub-text, of course, is that WT, and its directors, not only have something to hide; they have failed in their responsibility to protect public funds.

In a detailed and persuasive presentation [PDF], WT chief operating officer David Kusturin put the lie to the insinuation that the Queens Quay over-runs were just another example of botched civil works. More on his presentation in a moment.

But what’s also clear is that WT’s board, which includes representatives from the three orders of government and exists to protect the public interest, actively sought to verify the staff’s warnings about cost-overruns as early as February 2014.

Spacing has obtained the summary of an independent “governance and control review” of the Queens Quay revitalization project commissioned last winter by the WT board’s finance, audit and risk management committee (members: Janet Graham, Joe Pantalone, and David Johnson, with chair Mark Wilson ex officio).

The report was completed by MNP.ca, an accounting and risk management firm, and delivered to WT on February 28, 2014. According to the executive summary, the firm identified twelve factors driving cost increases and offered a second opinion on the revised project budget. Lastly, MNP suggested three key lessons about WT’s procurement model; its risk modeling and monitoring policies; and “board reporting and project oversight.”

On this critical last point, MNP’s recommendation was that WT officials pay particularly close attention during the very early stages of complex re-development projects in order to validate or re-visit pre-construction cost estimates. “A rigorous risk monitoring regime will help to compare the emerging reality against the original assumptions so that when trends begin to differ from initial assumptions, adjustments can be made.” It also urged regular board updates with such projects.

WT officials presented the MNP report to the board, complete with financial data, last March — months before Minnan-Wong launched his rocks-and-umbrellas crusade. In other words, there were no surprises when last week’s news hit. Little wonder, then, that WT directors like Jack Cockwell, a corporate titan with long ties to Brookfield, and Dave Johnson, a veteran Tory, had nothing but praise yesterday for how WT had managed a tough project.

“My sense,” said Johnson, a former Mike Harris cabinet minister, “is that it wasn’t as if money was wasted.” Added Cockwell, who sits on the board of a conglomerate with $175 billion in assets: “A lot of lessons have been learned.”

As for the timing of last week’s release of the over-run figure, Minnan-Wong, ever in search of top-spin, implied that it had everything to do with politics. WT didn’t want an embarrassing number out in the world before the municipal election.

But according to Kusturin, the agency didn’t reveal the figure until last week because it was still in sensitive negotiations with contractors over the cost of the numerous change orders triggered by a crucial delay in work that Toronto Hydro [PDF] was supposed to have completed before the reconstruction of Queens Quay began. (The utility couldn’t begin because the Ontario Energy Board failed to sign off on the project. The budget overruns were also caused by 110 unforeseen surprises in the ground, last winter’s extreme weather and inflation in the global price of marble granite.)

It’s also worth comparing the board’s due diligence to Minnan-Wong’s latest idea: At the end of yesterday’s meeting, he tabled a motion requesting that WT reports be made public a week before meetings. But that’s not real due diligence; that’s about sifting through documents, looking for opportunities to nit-pick.

During the meeting, WT chief executive John Campbell and chair Mark Wilson both pointed out that the agency has already internalized the lessons of the Queens Quay project and will incorporate more robust risk management measures with future projects, among them the $500 million East Bayfront LRT (as yet un-funded) and the naturalization and re-routing of the Lower Don.

Improved risk oversight, said Johnson, will be important “considering the fact that there are some major projects coming up, we hope, in terms of flood prevention infrastructure.”

Bottom line: WT’s board and managers were actively focused on protecting their shareholders’ financial interests (i.e., us, the taxpayers) long before Minnan-Wong and his megaphone came along.

And they will be doing that work long after he finds something else to attack.

photo by Thomas Hawk

7 comments

  1. Yes, sometimes it’s really regrettable that things once started cost more eg. nuke plants, the Mars building and varied other projects like Union Station reworks and, and, and…. But for Councillor Minnan-Wong to take such “umbrellage” when the situation that’s being dealt with, lake-fill/garbage and multiple services installed through and atop things, shows that not only he is ill-suited for real oversight, but alack, the new power structure too. It’d help to use less granite etc., but it’d also help if some of those doing the fussing actually tried to do things in the dead cold of winter.

  2. To: Toronto City Council

    Do your due diligence first before shooting your mouths off to the media. At the rate Minnan-Wong keeps pulling this crap, I for one can’t see it being more than a year before Tory gives the position of Deputy-Mayor to someone else eminently more suitable, in order to prevent alienation from some of his corporate and government buddies.

  3. Minnan Wong likes to exhibit faux outrage, the FUD creates noise and instills anger in some of the public. The anger that arises last longer and overwhelms fact and sensible facts and news (like your article John). Cherry picking line items is a lot easier for Minnan Wong, in the end I hope he gets called out for wasting his time (our tax dollars).

  4. I keep an eye on WT myself and the Board agendas are normally posted about week or more ahead of the meeting. The actual reports presented at the meeting are posted shortly afterwards. The City is also pretty good about posting agendas a week ahead but Councillors often introduce ’emergency” motions at Council and some are about very significant things where the only emergency is that the Councillor wants to avoid too much input! People who live in glass houses and all that!

  5. Considering that Rob Ford had a seat on the board and never attended meetings, DMW’s obvious politicking is almost a step forward. Hopefully he ends up distracted by the nitpicking search that he ends up nuzzling himself because people stop listening.

    Cheers, Moaz

  6. How can it be that only one councillor and two mayors seem to have no idea of what has been happening on the waterfront for the past 12 years? My neighbours have spent countless evenings at public and stakeholder meetings and feel that their work is being belittled by those who say that consultation hasn’t been adequate.

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