NEWS FLE PHOTO
Medicine Hat's proposed location for a supervised consumption site on South Railway Street on June 3, 2019.
gslade@medicinehatnews.com@MHNGillianSlade
Serious mismanagement of taxpayers’ money at a supervised consumption site in Lethbridge has been exposed by government and now a local MLA believes an audit needs to happen in Medicine Hat too.
An audit of ARCHES, a not-for-profit organization in Lethbridge that established a SCS in that city, revealed funding misappropriation and non-compliance of agreements, the UCP government said Tuesday while announcing it had cut funding to the SCS.
Jason Luan, associate minister of mental health and addictions, says funds were meant to provide service to the most vulnerable in Lethbridge. Instead it was used for European conferences including a trip to Portugal that cost $4,301, retreats that cost $7,557, entertainment and gift cards.
The audit found that more than $1.6 million is unaccounted for from 2017 to 2018 and $13,000 was used for parties.
The salary of a senior executive was $342,943 last year. The grant agreement government had with ARCHES allowed for a salary of $80,000.
The auditors were unable to complete the full review due to the state of ARCHES’ records and outstanding documents.
The government is consulting with law enforcement to determine whether further investigation is warranted.
Within months of ARCHES opening in Lethbridge with $1.6 million in government funding, a Calgary-based company, HIV Community Link, was given almost $1 million by the NDP government to cover initial costs of setting up a SCS in Medicine Hat.
The SCS for Medicine Hat was halted by the UCP government and none of the funds were ever used for the anticipated renovation of premises.
Drew Barnes, MLA for Cypress-Medicine Hat, says there needs to be an audit of how that money was spent.
“All taxpayer money spent should be subject to oversight,” said Barnes. “Significant amounts should always be subject to internal audits and all amounts should be subject to random spot audits.”
Barnes notes that some of this money was handed out by the NDP shortly before a provincial election.
“I believe citizens are owed a full look at the disbursement of these funds,” said Barnes.
There was no response to a request for comment from Michaela Glasgo MLA for Brooks-Medicine Hat.
A spokesperson for HIVCL said in an email that of the $900,000 it received as a start-up grant it has only used $295,000 for “project development”.
The organization also receives ongoing funding for current programs and services in Medicine Hat, but did not provide details of this.
Minister Luan’s office could not provide details on Thursday afternoon but a spokesperson says they are looking into the situation and will respond to the News’ request.
According to HIVCL’s website and the 2018/19 report, 86.85 per cent of its funding is from government with total revenue equalling more than $2.7 million, and 8.25 per cent is the cost of administration.
Back in Lethbridge: ARCHES received more than $14.4 million of taxpayer dollars in the last two years. The grant agreement on the number of staff had not been followed and salaries had been exceeded by $16,000, according to the audit.
Thousands was spent on travel that could not be verified and a senior executive’s family member was hired without any record of their qualifications for the job.
The audit report says the government agreement required ARCHES to maintain funding from Alberta Health in a separate bank account, which was not done and auditors could not verify thousands of dollars of expenses.
Vendors were repeatedly secured in secrecy with a lack of transparency and accountability, the report says. About $2,100 was spent on gift cards to The Oil Changer – a business owned by a senior executive’s spouse and $2,205 was spent on a television with no receipt documentation to support the purchase.
Alberta Health Services has set up a temporary mobile overdose prevention site in Lethbridge to transition the provision of services. Three recovery coaches will also be sent to the region to help.
