February 28th, 2024

City cleared in third-party review of Invest MH

By COLLIN GALLANT on October 4, 2021.

Tearful city councillor Brian Varga addresses family members of Jim Turner who were in the gallery at Monday night's council meeting. Turner died on Sept. 21 and his place at the council table was cloaked in black after his nameplate was presented to members of Turner's family. Each council member spoke about their relationship with Turner, who is the first city council member to die in office in recent memory. Council also discussed the city's draft recreation plan, ratified a new contract with power plant workers and also paid tribute to three councillors who are not seeking re-election on Oct. 18. Read those stories in future editions of the News.--News Photo Collin Gallant

cgallant@medicinehatnews.com@CollinGallant

A third-party report into how the city acted while attempting to contract out its economic development wing and land sales department this summer has found “no material wrongdoing,” said Mayor Ted Clugston, who pointed to the statement while holding it up in a post-meeting press scrum on Monday night.

Three candidates who are challenging him in this month’s election however, say it doesn’t say much of anything and doesn’t address Hatters’ concerns with Invest Medicine Hat.

“It says right here ‘all policies and procedures were followed,'” said Clugston, holding up the 25-page report. “So what you have is people over here (on one side) screaming about criminal malfeasance to ‘oh, you forgot to dot an ‘i’ and cross a ‘t’ – it’s a great report.”

Coun. Darren Hirsch, who chairs the administrative and legislative committee that technically launched the audit, said “there was no material flaws in the process” but five mainly administrative points to address.

It was ordered after a group of city employees was the only group to put forward a bid to take over the work of their department.

In the case of the Invest RFP, the News found that a specific reference to current city employees was removed from the language under the conflict of interest section.

Coun. Kris Samraj was the only other council member to speak to the report in the public session, stating some action is likely required to update city purchasing policy.

It suggests publicizing bids sooner, updating the city’s code of ethics last revamped in 1994, and also suggests some minor language be updated to align with trade agreements.

A sparsely written overview found the city followed its own procedures, but critics said specifically allowing city employees to bid on a largely unpublicized 10-year contract is problematic.

Mayoral candidate Linnsie Clark said to bring forth such a report likely won’t assuage those concerns.

“The community expressed a desire for greater fairness and standard of ethics, and in response to that, council spent our money to pay for a report to answer a question that we didn’t ask,” she said after the meeting.

“The community was saying ‘we expect better.'”

The report, which was commissioned at a cost of $75,000, was provided to the media only on Monday, but will be available on the city’s website today, a press release states.

“I wasn’t expecting anything earth shattering,” said mayoral candidate Alan Rose, who has been highly critical of the Invest program for the last two years.

“This is why I announced for mayor so early (last January), because there are so many concerns that I have … It wasn’t done properly … and they still don’t believe they’ve done anything wrong.”

The report, from national accounting and business advisory firm Deliotte, was presented at the final council meeting of the current term.

That was promised by Clugston, who has backed the city’s business office and has argued hard the controversy has unfairly hurt the city’s reputation.

“This vindicates those people who were, frankly, dragged through the mud,” said Clugston.

The process came under intense public scrutiny in mid July after the News revealed that the contracting out process had begun without any notification from city hall or discussion in council or committee meetings.

A number of city council candidates and mayoral hopefuls have seized upon it to argue that greater transparency is needed from the city.

Mayoral candidate Tony Leahy told the News he thinks a deeper investigation is required.

“This didn’t answer any of the questions I had,” he said. “I think the issue will only be resolved with a new council.”

Several current councillors have backed the work done by Invest, and said the entire RFP process was simply the end result of a long-planned spin-out of Invest back to a private-sector provider.

The work of the office was performed by a contracted-out entity from 2015-2019, when it was brought back in-house. Following a city-wide corporate reorganization it gained oversight of land sales and a number of grants, enticement programs and some planning matters.

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