Commission reviewed

PROVINCIAL INVESTIGATION: Accountability examined

Posted By DAVID NESSETH

Standard FreeHolder

March 28, 2009

The St. Lawrence Parks Commission will be part of a Ministry of Tourism review of its agencies accountability and procurement practices. The commission, which operates out of Morrisburg, was named along with the ministry’s five other member agencies following a recent investigation into the Niagara Parks Commission by the Integrity Commissioner. “We’re very open to a review and we feel confident about our policies in place, or we’re putting in place,” said Pat Mac-Donald, general manager of the St. Lawrence Parks Commission. “We try to be open and transparent about our procurement practices.” The local parks commission recently shed 21 employees and six per cent of of its 286 student summer jobs after undertaking its own internal operational review over the last year. It also created three new senior level director positions, including a director of customer experience. The operational review was conducted by KPMG, the same firm that currently has the Niagara Parks Commission under the microscope after last year’s renewal of its 25-year lease for its popular Maid of the Mist boat ride went ahead without going through the bidding process. Integrity Commissioner Lynn Morrison ruled there was no wrongdoing in the lease renewal contract for the Maid of the Mist tour boats in Niagara Falls. “I am confident the plan we have developed will clarify accountabilities and instill greater public confidence in the Niagara Parks Commission and all of our agencies,” said Minister of Tourism Monique Smith in a statement on her ministry’s website. According to the ministry, the agencies review will conduct a special audit of procurement and lease processes, audit recent procurement practices, provide guidance to facilitate accountability and sound business decisions, as well as provide additional board governance training. MacDonald described the local parks commission as being tied in more closely with the province than Niagara. For example, she said, their union is part of the province-wide OPSEU, whereas Niagara’s OPSEU workers are separate.

“We’re arms length (from the province),” MacDonald said. “They’re a little more than arm’s length.” A ministry spokesperson said a timeline for when the St. Lawrence Parks Commission review will take place won’t be available until after the current review into the Niagara Parks Commission has concluded, but MacDonald speculated they’d be “down on the list” considering her agency’s recent internal review. Other Ministry of Tourism agencies that will be reviewed include Ontario Place, the Metro Toronto Convention Centre, the Ottawa Convention Centre, and the Ontario Tourism Marketing Partnership Corp.

JAMES GLYNN POINT-COUNTERPOINT

Guest Views By Anthony Girasole and Calvin Hill

March 24 2009

I feel the need to set the record straight and respond to the ongoing attack on the Glynn family in the Niagara Falls Reporter.

Jim Glynn, his family and company have been a pillar of our community for as long as I can remember. I have lived here most of my life, and there are few other families or groups that have contributed like they do, year in and year out. They have employed local people, paid their taxes, worked on community projects, donated to charities and stayed in the community instead of fleeing to greener pastures.

Jim and his family have stayed active in the community, living in local neighborhoods and raising their families here. His business provides employment for dozens of local people, who also reside here with their families. His business provides revenue to the state, pays taxes and supports many local businesses.

Jim, his family and employees have served on innumerable boards and committees for countless hours, trying to improve the area and make it better for all of us. Niagara University, the Chamber of Commerce, the United Way, Catholic Charities, hospitals, schools, every charitable group and many others have all benefited from their generosity. He has, without fanfare or desire for recognition, supported many local charities with time and significant amounts of money, we dare say more than most.

I understand and respect the legitimate media investigating misdeeds and abuses, but to go after such a family in such a salacious manner just to sell papers should not be tolerated.

Frank Parlato desperately tries to make his point by attacking the character of the Glynns; one should question the character and motivations of the attacker — how will this benefit him and what has he done for our community? If Mr. Parlato feels something is amiss, he should discuss facts with the appropriate parties and not make empty accusations.

I feel confident that most everyone in the community would be comfortable signing this letter.

Anthony Girasole
Girasole Appraisal
Niagara Falls

---

In response to the defense of James Glynn in the Feb. 24 issue: Mr. Glynn is a wealthy man. His yearly income is probably one of the highest in the Western New York area and has been for 30-odd years. He has money he can either give to the government as taxes, or give to local charities as a tax write-off.

Heart and Soul is on Ontario Avenue and is a wonderful endeavor that helps the community immensely. However, I’m pretty sure there hasn’t been one building on Ontario Avenue from Main Street to Hyde Park Boulevard that has been valued at more than $200,000 ever.

Yet Mr. Glynn and his partner saw fit to do a $600,000 renovation? That’s a lot of dough for a soup kitchen — forgive the pun. So much so that if you looked at the guest list there — which I’m guessing is about 2,000 per year of the proud citizens of the city who have had to visit for a hot meal occasionally due to lack of jobs in the area (which, by the way, is largely generated from out-of-town businesses and corporations not wanting to do business in the Falls because of so-called locals engaging in racketeering scams, hoarding of contracts, etc.) — and just gave them the money, it could provide these families with grocery money for a few years each.

So Mr. Glynn is incredibly lousy at estimating the cost of fixing up an old building on Ontario Avenue, or else he’s inflated the numbers to save himself a little money and maybe hit some of his contracting buddies with a little extra cake to blow up the estimates.

Mr. Glynn doesn’t “provide” the No. 1 tourist attraction to the city; he has simply monopolized the best view of it — for which he charges a nice-sized fee, I might add, a fee that few residents who live west of 18th Street can afford.

Do you really think the citizens of Niagara Falls believe he’s been quiet about his contributions because his flawless character won’t allow itself recognition? The people he wants to know how much he “donates,” do, and act accordingly. It’s easy to give away money that is otherwise going to the government anyway to a private school or local soup kitchen when you have no-bid contracts reaping millions in revenue each year.

I wonder how charitable Mr. Glynn would be if he had to compete for every dollar in an open market. The damage he does to the city by not allowing capitalism to run its course outweighs any Band-aid like a soup kitchen or some fancy van for a private school.

Calvin Hill
Venice, Calif.

Niagara Falls Reporter

MEMBERS OF PARLIAMENT DEMANDING OPEN BID ON MAID OF THE MIST LEASE

Analysis By Frank Parlato Jr.

March 24 2009

The lease to operate the Maid of the Mist boat service, launched from publicly owned docks in Niagara Falls, Ont., will likely be put out for competitive bidding, numerous Canadian government sources told the Niagara Falls Reporter this week.

This means the 38-year monopoly enjoyed by the present Maid of the Mist boat operator, James Glynn, may soon end.

Glynn has operated boats from dock leases on both sides of the Niagara since 1971, giving him exclusive rights for every boat tour run under the falls since that time.

Despite the fact that the current lease for use of the docks doesn’t expire until November, the Niagara Parks Commission (NPC) secretly approved a new 25-year lease last April for Glynn’s company.

NPC Chairman Jim Williams and General Manager John Kernahan neglected to inform the other commissioners voting on the deal that two other companies, Ripley Entertainment and Alcatraz Media, had expressed an interest in bidding.

And although Alcatraz and Ripley’s officials have repeatedly stated they are willing to pay the parks commission up to twice as much as Glynn, the lease awarded last April actually lowers Glynn’s rent.

Glynn’s reign would have remained unchallenged for another 25 years, but for NPC board member and Ontario businessman Bob Gale, who saw NPC Chairman Williams and General Manager Kernahan working, he thought, a little too feverishly to get Glynn’s new lease approved a year-and-a-half before it expired. Gale complained to the Ontario Integrity Commission.

It turned out that the feverish rush may have been caused by the fact that world-famous Ripley Entertainment had asked to bid on the lease. It came as a shock to Gale, since both Williams and Kernahan declined to tell the part-time commissioners about Ripley’s interest. For the first time, the terms of Glynn’s leases received a liberal dose of sunshine when the Reporter began a series of investigative articles last July.

Williams criticized the Niagara Falls Reporter for its coverage. “We are being attacked,” he said in interviews. “Under siege” was the phrase he used in an e-mail to other commissioners.

“This keeps getting bandied about like it’s an important news story. The reality is, it’s only important to a couple of people in the community.” Williams said.

Last week, the Integrity Commission issued its report on this allegedly unimportant story. Besides demanding an audit of the NPC that will result in a careful review of all their leases, the Integrity Commission recommended that “in the course of the Ministry review of the (Maid of the Mist) lease renewal, the Ministry provide the Board the opportunity to review its decision … with full knowledge of all the expressions of interest received (from Ripley’s and others).”

And the NPC is required “to weigh numerous business and legal issues … with full knowledge of the expectations of the public and … in relation to sound agency governance and Revenue Generating Opportunities.”

Published policy on revenue-generating opportunities in Ontario is well established, which is to “advertise and tender.”

Ontario Tourism Minister Monique Smith said, however, that the NPC reviewing their decision won’t necessarily have to mean the lease has to go to tender.

“We’ll provide them with that opportunity to go back and look at the process they used. We’ll provide them with some information on governance and accountability,” she said.

Williams said the review could lead to the same decision. “Nothing has changed from what the board considered on April 18,” he said.

But members of Parliament, who ultimately have to approve the lease, are taking a different view.

Kim Craitor, who represents Niagara Falls, Tim Hudak, MPP for Niagara West-Glanbrook, and Peter Kormos, who represents Welland, have all gone on record demanding the lease be put out to bid.

“A request for proposals will clear the air and maintain the public’s trust in the NPC. Taxpayers deserve no less.” Hudak said.

“We have an expectation it’s going to be looked at in a different way since it’s being sent back,” Craitor said. Craitor said the NPC should scrap its current lease and start over with a competitive bidding process, and added that he was prepared to override any decision Smith might make about the handling of the process.

“If there’s a disagreement with the Minister of Tourism, it’s going to be what I think it is,” Craitor told the local press.

Simply put, when the commissioners voted for the lease, they were not given information business people normally need to make an important lease decision.

The NPC is losing money. To stem losses, they have been laying off staff and shortening their season. The NPC is deeply in debt.

Before Williams became chairman, the NPC earned a profit of $3.7 million in 2004.

They lost $4.3 million in 2008.

While neglecting to tell commissioners about Ripley’s interest, Kernahan nevertheless reported that a change in operator would cause the NPC to lose the name “Maid of the Mist.” This was either a grossly mistaken impression on his part or a bald-faced lie.

The Glynn corporation — which calls itself “Maid of the Mist Steamboat Co. Ltd.” — has been in existence only since the 1970s. The name existed for 125 years before he came along. And according to the lease, the name

“Maid of the Mist” can be retained by a new operator.

Paragraph 6.03 states:

“Tenant (Glynn) acknowledges that it does not claim any interest in or rights in the words ‘Maid of the Mist’ except in its company name and the name of its motor vessels and NPC is free to use ‘Maid of the Mist’ in identification of its structures, retail or promotional material.”

Kernahan proceeds with what could at best generously be called a lie by omission.

He reported, “The current agreement (lease) is ‘landlord friendly.’ By not renegotiating … the agreement with the Maid of the Mist, we had hoped to avoid weakening the original agreement.”

But while Kernahan has told anyone who would listen that Glynn’s rent was increased under the new lease, a forensic auditor hired by the Toronto Globe and Mail to review the agreement concluded exactly the opposite.

Damian Alksnis, a partner at MG Forensics Group in Toronto, found that while the new lease raises the rent by 2.5 percent on the lowest $11.5 million Glynn makes, it drops the rent by 9.5 percent on every million above $17 million.

Glynn made $17 million in 2005. Since then, he has earned well over $20 million per year.

On a handout they gave commissioners, Williams and Kernahan tried to show the NPC would get more rent — but, curiously, they showed numbers only from 2001 to 2005, rather than more recent years.

The information presented to the commissioners for their review was two-and-a-half to seven-and-a-half years old. It included no numbers for 2006 or 2007.

Rates have increased since 2005 by an average of 94 cents per passenger.

In reports when presenting numbers for a future income-based percentage lease, the standard practice is to project into the future rather than use past years without factoring for inflation.

The losses to the NPC from the new Glynn lease will be an estimated $626,700 in the first year alone, and possibly $25 million over the 25-year term of the lease.

The NPC is believed to have budgeted revenue of $3.5 million from Maid of the Mist for 2009. Under the new lease, starting in 2010, it if it is not reviewed and redone, NPC should start budgeting about $1 million less per year.

Like Kernahan, Jim Williams claimed the lease was better for the NPC — before he knew the Reporter had obtained a copy of it.

“When all the factors were considered in total, this was a good lease and a good business decision,” Williams said. On March 6, Williams told the Globe, “Our revenue will increase through the extension of this lease.”

“If I were picking one, I’d go with the old lease,” said the Globe’s forensic accountant Alksnis.

Alksnis concluded the parks commission will make less money “by a significant margin, over the next 25 years, given inflation and fare increases that have already taken place.”

This year alone, he said, the boat tour will bring in $24.2 million, if it can attract the same number of passengers it did in the first half of this decade. Under the old lease, the parks commission would be entitled to $3.6 million of that, but under the new one, it would earn just over $2.9 million.

“So they’re worse off … under the new lease agreement,” Alksnis told the Globe. “Once you hit ($17 million), you’re worse off, and you’re exponentially worse off.”

Christopher M. Glynn, president of Maid of the Mist Steamboat Co., said the documents obtained by the Reporter and the Globe were incomplete.

“I’m not able to comment on what’s in there, but I can tell you that you have a critical omission there,” he said.

Glynn refused to provide details or documents.

“To suggest that there’s no adjustment for ticket-price increases over the period of the lease is incorrect,” he said.

But the secretive Glynn did not go as far as saying the new lease is better.

The Reporter obtained the so-called “critical omission,” and frankly it doesn’t change much at all.

It is this:

“Re-negotiation of the rental rate … will be allowed every five years commencing in year 10. … if agreement can not be reached it would be subject to arbitration with the proviso that no arbitration judgment shall be for less than the existing percentage rents. Arbitration will be in Niagara Falls by a sole arbitrator appointed under the provisions of the Ontario Arbitration Act 1991.”

In other words, the critical information is that Maid of the Mist gets a lower rent for at least 10 years, and then they get to negotiate on a rent increase. If they do not agree to a rent increase, then it goes to arbitration.

Can you imagine renting a government locale to a tenant and not having the power to raise the rent unless he agrees?

Kernahan then threatened the commissioners.

“There is also the question of lease renewal and damages. … It is expected that the Maid of the Mist would make a case for damages, if any, based on the difficulty on relocating their business, the value of the boats, etc. The exact extent of these damages would have to be determined by a court.”

Of course, this is preposterous.

A lease with an expiration date has no mandate for renewal.

Tourism experts said competitive bidding may bring in as much as $150 million more over the life of the lease.

That by itself might cure the problems for the NPC.

We’ll be awaiting the results of the NPC review.

Niagara Falls Reporter

Craitor takes second swing at transparency bill

Private member’s bill would open up public bodies to more scrutiny

Posted By Corey Larocque

Niagara Falls MPP Kim Craitor is taking another crack at getting public bodies to open their doors to more scrutiny. The Liberal politician introduced a private member’s bill, The Transparency in Public Matters Act, Tuesday at Queen’s Park where it received first reading.

“That one’s pretty straight forward, “Craitor said after introducing Bill 159, a new version of a bill he tried to push through the legislature in his first term.

His private member’s bill would require a list of public bodies, including municipal councils, hospital boards, and provincial agencies to meet in public, notify the public of their meetings and make minutes available to the public.

It’s his second bid to throw open the doors to a long list of public agencies, including the Niagara Parks Commission, Ontario Lottery and Gaming and Niagara Health System.

Some of the bodies on Craitor’s list are already required to meet in public, according to other provincial laws. But Craitor’s bill would allow Ontario’s Information and Privacy Commissioner to investigate complaints from the public that a public board has met privately. A fine of up to $10,000 could also be levied against directors of a board who allowed a meeting to occur privately.

Two similar private member’s bills since 2004 also failed to get through Queen’s Park.

Getting a private member’s bill passed into law can be challenging because it doesn’t have the backing of the government.

Craitor said he’s optimistic it will clear the hurdles this time. He has an opportunity to call the bill for second reading on April 23. That will leave two and a half years before the next election for it to wind its way through the legislative process.

“It works out well when you have your ballot time on the 23rd of April, so I can begin moving it forward,” Craitor said.

Alcatraz Media and William M. Windsor Take Legal Action in Attempt to Obtain Billion Dollar Contract for Boat Rides under Niagara Falls

Since 1846, the Maid of the Mist has carried hundreds of millions of passengers on a scenic ride under Niagara Falls. From the beginning, the rights-granting process for operating the boats has been kept a secret while profit-making companies have retained operational control without going through the process of competitive bidding. Learning of this secrecy is what prompted businessman William M. Windsor to take action.

Atlanta, GA (Vocus/PRWEB ) March 24, 2009 — Atlanta-based Alcatraz Media and businessman William M. Windsor are jointly attempting to obtain the billion dollar contract for boat rides under Niagara Falls. The boat rides began in 1846, and there has never been an opportunity for anyone to bid to offer the service until Windsor took legal action against the Province of Ontario and the State of New York. This case is currently being handled by the Ontario Superior Court of Justice under case number DC 09-105JR.

The governments of Ontario and New York lease the park land on each side of the Niagara River to a third party so that boat rides can be offered. These rights in Ontario, Canada are granted by The Niagara Parks Commission, and these rights in New York are granted by the New York State Office of Parks, Recreation and Historic Preservation.

No bids were taken and no public hearing was held because the Canadian agreement gives the company exclusive access to the river below the Falls, making it a ‘sole source’ provider
We believe The Niagara Parks Commission will realize as much as $100 million more by accepting competitive bids. Since they lost $4.3 million last year, competitive bids on this contract should erase the losses.
The boat rides at Niagara Falls are one of the biggest tourist attractions in North America. Hundreds of millions of people have taken rides on the “Maid of the Mist” since 1846 and 2,500,000 people currently ride the boat each year. When Alcatraz Media discovered in October that the rights to operate these services on government-owned land had been given to profit-making companies for 163 years without ever giving anyone the opportunity to bid, Alcatraz and Windsor cried foul.

Windsor and Alcatraz Media originally asked for the opportunity to bid in 2005, but attempts were quickly rejected. Ripley’s Entertainment asked for the opportunity to bid in 2008, and their efforts were similarly dismissed. One of the Niagara Parks Commissioners, Bob Gale, filed a complaint about the secret process with the Ontario government. When Alcatraz and Windsor learned of this, they began working full-time to build public support against secret practices such as this since governments are expected to be fair, open, and to allow competition for such lucrative opportunities.

Windsor says, “Our calculations showed that these contracts will generate over $1 billion in revenues at a very high margin of profit for the lucky operator given this exclusive monopoly at one of the wonders of the world. I asked ‘how in the world does one company get the rights to such a pot of gold from two governments in two states in two countries with no competition and no concerns about competitive bidding?’ This simply isn’t the way governments are supposed to operate.”

When turned away again in October, Windsor launched a campaign using his web site www.NiagaraFallsBid.com. He has campaigned for openness in government dealings and adherence to the law ever since.

The lawsuit in Canada asks the court to void the lease and mandate a public tender because the policies of government entity The Niagara Parks Commission require advertising and a public invitation for anyone to bid on all contracts over $100,000. Maid of the Mist Steamboat Company Limited was awarded a 25-year contract in April under very secret, controversial circumstances, which goes against the aforementioned policy.

Last week, the Ontario Integrity Commissioner, Lynn Morrison, issued a ruling that indicates the bid of Alcatraz Media and Windsor is to be considered.

The legal action in New York is based on a similar New York State Finance Law that requires advertising and a public invitation for anyone to bid on all contracts such as this. Maid of the Mist Corporation was given a 40-year contract in 2002. “No bids were taken and no public hearing was held because the Canadian agreement gives the company exclusive access to the river below the Falls, making it a ‘sole source’ provider,” said Angela Berti, a spokeswoman for Niagara Falls State Park in a statement to the Buffalo News in 2008.

When Windsor became aware of this statement in a newspaper article, he began investigating. He first contacted all government authorities in Canada and the United States to determine if there could be any validity to a claim that Canada controls the water beneath the Falls. The response was unanimous: The waters of the Niagara River are jointly used by both Canada and the United States by a long-established agreement. Windsor then obtained a copy of the lease between The Niagara Parks Commission and Maid of the Mist Steamboat Company Limited, the Canadian legal entity owned by James V. Glynn of Lewiston, New York. The Canadian lease contains no such provision.

Windsor feels his legal action should result in a cancellation of the 40-year contract that Maid of the Mist Corporation obtained in 2002, and that the contract should be tendered for bids. A decision in the New York action could come any day.

While Alcatraz Media is the largest business in North America, selling destination tours and activities including over 800 boat tours of various types, this is a David and Goliath story with relatively tiny Alcatraz Media and Windsor suing two governments in two countries.

Ryan Windsor, CEO of Alcatraz Media, said, “When we started this effort, everyone said there was absolutely no chance that we would succeed. Those people don’t know my Dad. When he grabs a hold of something, he doesn’t let go. His efforts have resulted in hundreds of newspaper stories about this. The union of the government employees in Ontario has publicly demanded that competitive bids be taken and that the group of people who approved this secret deal be removed. The three members of Parliament from the Niagara Falls, Ontario area have all made public statements supporting our attempts. Dad has rallied the troops in Niagara Falls with a never-ending barrage of emails, faxes, and letters. Dad has become kind of a folk hero in Niagara Falls. It has truly been a grassroots effort. Alcatraz Media is overjoyed that we have a real shot at winning this billion dollar business.”

Because of the secrecy of The Niagara Parks Commission, including a secrecy oath taken by the government employee Commissioners, one of the battles has been that absolutely no information on the dealings has been made publicly available. Windsor reports, “Our attempts to obtain the documents needed were ignored. Employees of The Niagara Parks Commission were afraid to speak out over fear of losing their jobs. Then I received an anonymous email with a copy of the Procurement Policy of The Niagara Parks Commission with a note about other alleged violations. I believe I am now up to five ‘Deep Throats’ who have anonymously sent me government records that have enabled us to expose what has happened. The Globe and Mail in Canada, comparable to The New York Times, hired a forensic accountant to review the terms of the secret new deal, and he reported that the government would receive substantially less from this deal. I publicly announced that we will pay double what the current operator pays.” Ryan Windsor said, “We believe The Niagara Parks Commission will realize as much as $100 million more by accepting competitive bids. Since they lost $4.3 million last year, competitive bids on this contract should erase the losses.”

For more details on this story, visit www.NiagaraFallsBid.com.

Alcatraz Media is the world’s largest provider of tours and activities, welcoming over a million visitors per month. They provide reservations for more than 10,000 tours, attractions and activities in over 400 destinations and 60 countries. The business was formed in 1999 in San Francisco, California and is now headquartered in Atlanta, Georgia.

William M. Windsor is an entrepreneur who has started over 50 companies during his career.

For more information, please contact Bill Windsor by phone at 770-578-1094 or email.

###

From the Ontario Legislature, March 24, 2009

NIAGARA PARKS COMMISSION

Mr. Peter Kormos:

To the Premier:

A 1999 review and a 2004 employee survey revealed serious concerns about the Niagara Parks Commission’s governance structure, yet this government has hired a high-priced consultant to review the very same matters. Instead of wasting more public money on a report that’s going to tell us what we already know, why doesn’t this government scrap the Niagara Parks Commission and bring its responsibilities under this government’s direct authority? Hon. Dalton McGuinty: To the Minister of Tourism. Hon. Monique M. Smith: As the member opposite knows, the Ontario Integrity Commissioner recently undertook a review of some questions that were put to her with regards to the Niagara Parks Commission. As part of her report back, she recommended that we undertake a governance review, which we were only too happy to do. We are undertaking a governance review of all of our tourism agencies. We will be starting with the Niagara Parks Commission. We are happy to respond in this way to the Integrity Commissioner’s recommendations, and we will be moving forward in due course. The Speaker (Hon. Steve Peters): Supplementary? Mr. Peter Kormos: The 2004 employee survey concluded: “Respondents feel that strategic decisions have been impacted by political influences which may not represent the best interests of the NPC as an entity.” So instead of hiring yet another high-priced consultant to defend a pretty rotten state of affairs at an unelected and unaccountable Niagara Parks Commission, why won’ t the minister realize that the best and most cost-effective decision is to simply scrap the commission altogether? Hon. Monique M. Smith: Thank you to the member for allowing me the opportunity to speak to the Integrity Commissioner’s report and some of the recommendations that she made. I do want to note that in the report she found no wrongdoing on the part of the Niagara Parks Commission board of directors, although she did feel that there needed to be some work to restore public confidence in the commission. To that end, she recommended a governance review, which we are undertaking. As well, she recommended, and we are undertaking, to conduct a special audit of procurement and lease processes, an audit of recent procurement practices. We are providing guidance to facilitate accountability and sound business decisions, and we’ll also be providing our board with additional governance training. These are all recommendations that were made by the Integrity Commissioner, which we are moving forward with forthwith.

Kim Craitor’s Bill Image Ontario Legislature, March 24, 2009

INTRODUCTION OF BILLS TRANSPARENCY IN PUBLIC MATTERS ACT, 2009 /  moved first reading of the following bill: Bill 159, An Act to require that meetings of provincial and municipal boards, commissions and other public bodies be open to the public / The Speaker (Hon. Steve Peters): Is it the pleasure of the House that the motion carry? Carried. First reading agreed to. The Speaker (Hon. Steve Peters): The member for a short statement? Mr. Kim Craitor: The bill is designed to bring transparency to Ontario agencies, boards and commissions. It designates certain public bodies that receive financing or act on behalf of the government to give reasonable notice to the public of their meetings, of proposed additions to the meetings, and to ensure that meetings are open to the public. As well, it requires them to keep minutes of meetings and to publish them. Finally, the bill establishes a procedure by which a person who believes a designated public body has contravened or is about to contravene the bill may make a complaint to the Information and Privacy Commissioner, and it makes it an offence to fail to comply with an order from the privacy commissioner.

Below are the entire minutes:

24-mar-2009_l125

CANADIAN TROUBLES COULD HURT GLYNN’S STANDING ON U.S. SIDE, WINDSOR SAYS: New York contract hinges on agreement with Canada

By Frank Parlato Jr.

ust for the record, the Maid of the Mist Steamboat Co. pays the Niagara Parks Commission 15 percent of gross receipts on its boat tours in the Niagara Falls Provincial Park in Ontario, and 10 percent or less on the New York side. The New York lease was secretly renewed in 2002 for 40 years, and is the longest lease agreement ever given by state parks.

Bill Windsor, of Alcatraz Media, filed a “contract protest” with the New York State Comptroller’s Office on March 4, objecting to the Maid of the Mist’s insanely long, 40-year, no-bid agreement.

Windsor questioned why “one businessman should have the exclusive rights to one of the premier water attractions in the world on government land.”

Alcatraz Media had tried to bid on the Ontario lease, and filed a lawsuit in February with the Ontario Superior Court to have the Ontario lease declared illegal.

Windsor hopes to bid on the New York state lease as well.

His New York protest could result in a cancellation of the 40-year contract that Maid of the Mist Corp. obtained in 2002, and the contract could ultimately be open for bids, if the state comptroller’s office rules that the procurement was entered into illegally.

The Maid of the Mist Corp. of New York responded to Windsor’s protest on March 11.

The response by attorney Marc Brown, of Phillips Lytle in Buffalo, was filed with the New York State Comptroller’s Bureau of Contracts.

At the heart of the dispute is that the New York State Parks Office failed to advertise or tender the New York Maid of the Mist contract for bids, violating their procurement policy.

Angela Berti, spokeswoman for Niagara Falls State Park, told the Buffalo News in 2008 that “no bids were taken and no public hearing was held because the Canadian agreement gives the company exclusive access to the river below the falls, making it a ’sole source’ provider.”

But Berti was wrong.

Canada does not control the water beneath the falls. The waters of the Niagara River are jointly used by both Canada and the United States by long-established agreement.

Nevertheless, Maid of the Mist lawyer Brown had a argument for the defense of his client.

He said that under New York state finance law, a “sole source procurement for services” may be made without a formal competitive process when there is no other bidder that could possibly provide the service.

Brown claimed that Maid of the Mist is the only one who could provide the service, because its lease, under its Canadian corporation, with the Niagara Parks Commission “allows (the New York) Maid of the Mist Corporation to dock its boats on the Canadian side.”

In short, without the Canadian lease, there will be no place to store the boats in New York, hence requiring New York State Parks to give the lease to Glynn, since he has the Canadian lease.

Actually, there is no provision in the Canadian lease giving the rights to the U.S. Maid of the Mist Corp. to dock its boats on the Canadian side. But since Glynn has both leases, he can presumably legally dock his boats, and in fact does, on the Canadian side.

But there is a larger problem with this argument.

One which unhinges it altogether.

New York State Parks were required to give Glynn the lease since he controlled the Canadian side?

This was their justification for naming Maid of the Mist a “sole source provider,” according to Brown.

But Glynn’s Canadian lease expires this coming November.

When the parks service gave Glynn his 40-year New York lease in 2002, they had no assurance that Glynn’s Maid of the Mist Corp. could perform on the contract beyond the expiration of his Canadian lease.

The state gave Glynn his lease on the New York side for 33 years beyond the expiration of his Canadian lease (to 2042).

If, as Berti told the News, there was a need for sole source — since whoever has the Canadian side has to have the U.S. side — then why didn’t New York make the two leases synchronous?

According to Section 163 of the New York State Finance Law, “procurements shall be competitive, and state agencies shall conduct formal competitive procurements to the maximum extent practicable.”

The Maid of the Mist defense is that the New York State Parks determined that the docking of boats in another country justified the parks office to designate Maid of the Mist Corp. as the “sole source” for this service.

Section 163 says: “State agencies shall minimize the use of single source procurements and shall use single source procurements only when a formal competitive process is not feasible.”

Section 163 also says: “The term of a single source procurement contract shall be limited to the minimum period of time necessary to ameliorate the circumstances which created the material and substantial reasons for the single source award.”

What was the basis then for a 40-year contract, when the alleged reason for the sole source provider designation could not be assured past November 2009?

New York State Parks entered into a contract for 33 years beyond that date.

The Maid of the Mist lease in this state describes the company as the “sole commercial entity with rights of access to provide scenic boat excursions from landings both on the American and Canadian sides of the lower Niagara pool.”

Since Glynn’s Canadian Maid of the Mist Corp. might lose the Canadian lease when it expires in November 2009, then Glynn may also lose the New York lease, if it were true that one is dependent on the other.

Brown claims docking boats on the Canadian side is an unusual circumstance justifying sole source status, because there is insufficient room to dock boats on the U.S. side of the river.

Of course, this is not true.

There are many ways that Maid of the Mist Corp. or another operator could dock or store its U.S. boats other than depend on the Canadian side.

All the parks service had to do was add a requirement that any bidder had to obtain dock space somewhere other than at Niagara Falls State Park.

The New York State Comptroller’s Office is expected to render a decision in this matter fairly soon.

If it goes out to bid, New York state, now hard pressed for money, will likely receive substantially more than the measly 10 percent it currently gets.

A recent award by the National Park Service of the Statue of Liberty and Ellis Island ferry contract is an example of how it should be done.

The boat contract, which was for 10 years, was published widely, and its terms were known. It had many major boat-tour bidders, including Hornblower Cruises, Circle Line, Circle Line 42, New York Waterway, New York Water Taxi, Entertainment Cruises, and others.

These companies also are expected to bid on the Maid of the Mist lease, along with Alcatraz and Ripley Entertainment, and to drive the rent way up for New York.

Tourism experts say that the rent could exceed 25 percent. With substantial layoffs in the parks, this may be welcome news.

Niagara Falls Reporter www.niagarafallsreporter.com March 24 2009

Gale drops second complaint against Niagara Parks Commission

Former commissioner questioned chairman’s use of NPC credentials on private website

Posted By Corey Larocque

Calling it “time to move on and get better,” Bob Gale dropped a second complaint about the Niagara Parks Commission he had filed with Ontario’s integrity commissioner in February.

“I am satisfied with the Integrity Commissioner’s report from earlier this week that the Niagara Parks Commission is on the right path to open and transparent business with the public’s behalf in mind,” Gale wrote in an email he sent Wednesday to Integrity Commissioner Lynn Morrison’s office.

The move comes two days after Morrison cleared Parks chairman Jim Williams of any wrongdoing in the way his board renewed a 25-year lease with the Maid of the Mist Steamboat Co.

But Tourism Minister Monique Smith acted on the report’s six recommendations by ordering a review of the way the Niagara Parks Commission and five other agencies are governed. She also told the parks commission to take a second look at the Maid of the Mist lease.

Pursuing a second complaint “would serve no purpose” now because the Ministry of Tourism has already taken steps to look at how the parks commission runs, Gale said.

The second complaint alleged Williams used his Parks position to benefit himself. Gale filed what’s known as a “disclosure of wrongdoing” in February, after seeing a website for a consulting company Williams created last year with his brother-in-law, Ted Palmer. Gale objected to the way Williams – a retired federal government manager – listed his Parks chairmanship on a website for Williams-Palmer Consultants.

Williams said there was nothing wrong with listing his credentials on the website and the description included information from his professional biography that is used for introducing him when he speaks in public.

“What’s on that website is no different from what is said about me in my biography. How that was deemed to be inappropriate boggles my mind,” Williams said.

“I would have welcomed him to see it through, because again he would have been proven wrong,” he added.

The results of an investigation into Gale’s first integrity commissioner complaint were published Monday. His objection in August was to the process the parks commission followed to renew the lease that allows the Maid of the Mist to operate on land owned by the parks commission.

Morrison took what she said was the “unusual” step of publishing that report because of the public attention the case received, mostly because Gale talked to the media about it during the probe.

The integrity commissioner typically handles concerns brought by anonymous employees of Ontario’s public service. Her office is allowed to keep investigations private to encourage public servants to blow the whistle without the fear of losing their jobs.

There doesn’t appear to be any policy preventing the integrity commissioner from halting an investigation in mid-stream.

“Every file is different and issues like this are resolved on a case by case basis,” said Valerie Jepson, the lawyer for the integrity commissioner’s office.

clarocque@nfreview.com

Comments From The Editorial Page, Globe And Mail

on the contrary you need to think my way from Canada writes: Once again no one is responsible, within a gov’t, for an obvious blunder. They state as much when ” the decision to renew the lewase should be carfully reviewed.”

One wonders how badly to need to f%$k things up before you are accountable. Posted 16/03/09 at 3:21 PM EDT

________________________________________________________

Gardiner Westbound from Canada writes: .
A 10-year old can do the math. The Niagara Parks Commission is being whizzed. Bust everybody!

Posted 16/03/09 at 4:41 PM EDT |

________________________________________________________

Word Smith from Canada writes: It was my understanding that when a commercial lease is renewed it is usually under the same terms and conditions that existed previously, adjusted for inflation, etc. If there are changes to the lease ‘rent’, then the rent should be expected to increase. Renewing a lease should be a relatively simple arrangement.

By the number of changes made to the ‘rent’ to be paid under the new ‘Maid of the Mist’ lease entered into by the NPC, for the most part in favour of the Maid of the Mist, it would appear that this is a completely new lease, not a simple lease extension.

I think that competing business operators who wanted an opportunity to compete or bid against the Maid of the Mist in an open tender process should be outraged at this 25 year lease extension.

It is likely that the new lease cannot be broken without having to pay an exorbitant penalty.

I doubt that there was anything ‘fair’ about these lease renewal negotiations. The NPC got hosed, and the Maid of the Mist is laughing all the way to the bank.

Posted 16/03/09 at 5:16 PM EDT

_________________________________________________________

Pete H from Canada writes: The line “something is rotten in the state of Denmark” comes to mind when news articles about the Niagara Parks Commission and their apparent penchant for sweetheart deals.

Posted 16/03/09 at 5:19 PM EDT

_______________________________________________________

Lyn Alg from Canada writes: And here you thought cronyism existed only in politics. Welcome to the world of big business. Wakey, wakey, people !!

Posted 16/03/09 at 5:21 PM EDT

_______________________________________________________

Craig Mitchell from Canada writes: Who in their right mind
1) would agree to this lease knowing it would bring them less money than before?
2) agree to a contract of this size without getting competitive bids on it?
Totally irresponsible on the part of the NPC and they should all either resign their positions or be removed.
Bring some people in that know how to run a business!

Posted 16/03/09 at 5:26 PM EDT

__________________________________________________________

Jay Dubya from Canada writes: No surprize here – how do we appoint these idiots that always have the public getting the short end of the stick?

The chair should be fired. Mr. McGinty are you listening.

Posted 16/03/09 at 5:52 PM EDT |

__________________________________________________________

Policy Wonk from Canada writes: Lyn, the Chair of the NPC is a public sector appointment. That means that in this case it is political cronyism at play, but it is the private sector that gets the benefits, as usual. Taxpayers, screwed once again!

Craig and Jay, I agree wholeheartedly. Although, don’t hold your breath waiting for change.

Posted 16/03/09 at 6:01 PM EDT |

___________________________________________________________

Pete H from Canada writes: Lyn Alg from Canada writes: And here you thought cronyism existed only in politics. Welcome to the world of big business. Wakey, wakey, people

Clearly you’re the one who needs to wake up, ths is local politics at it’s finest, and sweetheart deals always have a price attached.

Posted 16/03/09 at 6:56 PM EDT

___________________________________________________________

Sylvia Kemp from Niagara-on-the-Lake, Canada writes: Certain commissioners on the Niagara Parks Commission are long time fundraisers for whichever party is in power — Liberals or Conservatives. The Integrity Commissioner’s decision is not surprising. By the time KPMG’s investigative report is released, the public will have forgotten, and the report will likely get buried. Despite alleged corruption, cronyism, nepotism, etc. it will be business as usual for the Niagara Parks Commission.

Posted 16/03/09 at 7:40 PM EDT |

__________________________________________________________

M M from Barrie, Canada writes: Let’s not kid ourselves here – it is not cronysm, incompetence, indifference of bureaucrats or anything similar. This is obviously an out-and-out case of bribery and corruption.

Posted 16/03/09 at 8:18 PM EDT

_________________________________________________________

Joyce Rudd from Niagara Falls, Canada writes: Kudos to the Globe & Mail for covering this story, when our own local papers wouldn’t. This issue will not be swept under the table, unless the people of Ontario allow it. The Maid of The Mist lease is not the only questionable business decision made by the NPC. Keep up the good work Anthony Reinhart

Posted 16/03/09 at 8:40 PM EDT

___________________________________________________________

john shantz from Canada writes: Bravo to G and M for investigative journalism. Lets have more of it!!

Posted 16/03/09 at 10:56 PM EDT |

__________________________________________________________

Steve Jobes from Beamsville, Canada writes: KUDOS to Bob Gale for sticking up for the people of Niagara, Ontario, & Canadian citizens as a whole… More people like him should have influence on how our country operates… Instead of the BS politicians who only care about votes & keeping office…

The chair of the parks commision should be outright fired, the entire commision should be thrown out, if only the integrity commision had not succumbed to the lobbyists hired maybe we could have finally seen our government step up and hold someone accountable.

This was, is, and will always be a gigantic stain on anything to do with the Niagara Parks, and personally, I feel my government has let me down and tarnished the great sense of pride I have.

Good Job Bob!! Hopefully the Globe & mail keeps reporting on this, it should only be the beginning!!!!!

Posted 16/03/09 at 11:30 PM EDT |

__________________________________________________________

Paul Lawrence from Oakville, Canada writes: Wow, people are making brash decisions without looking into things a little more.

Unlike many peoples own homes, or businesses, maid of the mist isn’t paying one set fee for the yearly or monthly costs. So essentially before the rate was set to 15% of their income, and the company is still taxed ontop of that, essentially making their tax rate to be a lot higher than most of you would pay.
All the proceeds to towards the upkeep and general maintenance of all the parks around Niagara Falls.

How many of you would be upset with your landlord, or to the bank when they force you out of your home because someone else is willing to pay the same amount of money, or more?

Give the Maid of the Mist a break, they’ll need that additional revenue for general upkeep, rising fuel costs, and new boats without having to increase rates.

I don’t believe that you should continue to rely on one key business to fund the majority of your organization. I wonder how much of that 3.x million gets used on immediate lands that the Maid of the Mist Occupies. I highly doubt a lot of it goes towards maintenance for it. What a huge slush fund.

Posted 17/03/09 at 5:55 AM EDT |

___________________________________________________________

Hung Long from Hong Kong writes:
The Whitewash Department has done its job. Ontario has the best government money can buy!

Posted 17/03/09 at 9:04 AM EDT

___________________________________________________________

Peter Griffin from Quahog, Canada writes: The Niagara Parks commission receives no taxpayer money. I repeat no taxpasyer money. They generate their own money. Why would they screw themeselves out of dollars.

This story has been blown way out of proportion.

The Globe is reporting like they have all the facts when in fact they have virtually none.

Posted 17/03/09 at 10:25 AM EDT |

___________________________________________________________

Brian Van Ezel from Canada writes: Lets hope the Ontario Government does not renew this 25 year contract. They can do better.

Posted 17/03/09 at 10:31 AM EDT |

___________________________________________________________

An Non from Canada writes: “So essentially before the rate was set to 15% of their income, and the company is still taxed ontop of that, essentially making their tax rate to be a lot higher than most of you would pay.”

Are you kidding me? The percentage of revenue they pay is for the exclusive land and water rights as an operator. It is not a tax.

“How many of you would be upset with your landlord, or to the bank when they force you out of your home because someone else is willing to pay the same amount of money, or more?”

It happens all the time. Commercial rents go up, you can either re-sign at the new rates or not–that’s business.

Why should the taxpayers of Ontario not have their interests protected like any other business in the province?

Posted 17/03/09 at 10:54 AM EDT |

____________________________________________________________

Mr. Mike from Niagara Falls, United States writes: Peter Griffin: The Niagara Parks Commission receives no taxpayer money, but they have control of invaluable government land. They borrow money with the benefit of their government agency status.

In 2008, the Niagara Parks Commission lost $4.3 million — down $8 million from a $3.7 million profit in 2004. What facts doesn’t the Globe and Mail have? Please enlighten us because the Niagara Falls Bid web site is filled with information that the Globe and Mail undoubtedly used.

The financial information that the commissioners were shown is a link to this article. It shows that the commissioners weren’t even shown 2006, 2007, or 2008 financials. The information the commissioners were given had no projection at all of the future impact of this new lease. The rates paid by Maid of the Mist increased by 50% from the original 1971 lease with the new owner to the current 1989 lease. This proposed new lease looks to me like it, at the very least, drops back to the 1982 level of 12%. Why would anyone on the NPC want to take less? This is an exclusive monopoly that will generate over $600 million, and Maid of the Mist is out of business if they don’t accept NPC’s terms.

Take a look at the Revenue/Attend numbers. This is the average revenue per customer. It was $9.23 in 2003, and it shows that went down to $9.10 in 2005. Rates went up significantly over those years — 75 cents for adults and 50 cents for children. How could the average rate per customer have gone down??? Someone needs to explain this!

One bidder says he will pay double. That’s at least $75 million more than Maid of the Mist will pay. That will almost get the Niagara Parks Commission out of debt. Posted 17/03/09 at 10:54 AM EDT |

___________________________________________________________

Broken Record from Victoria, B.C., Canada writes: Come one, people – it’s Niagara Falls. The region is not known for the honesty of its politics.

Posted 17/03/09 at 1:27 PM EDT |

__________________________________________________________

mary anne seppala from Niagara Falls, Canada writes: All of the people living in Ontario and paying Hydro bills own a part of the Niagara Parks Commission. Hydro One pays over $10,000,000 a year to the Parks Commission for water rights to divert water at night to the Sir Adam Beck Generating Station in Queenston.
We need accountability, transparency and good governance from the NPC Board who represent us.

Posted 17/03/09 at 2:08 PM EDT |

____________________________________________________________

Sean Malone from Canada writes: The maid is the least of Niagara’s worries. We need a niagara that doesn’t have 30 mayors all on different pages with zero plan. The dault mcguinty proved it on a provincial level…Niagara proves it everyday as its cities and towns are crumbling…
Zero plan = Zero future. The maid is the least of Niagara worries.

Posted 17/03/09 at 3:53 PM EDT

More transparency needed in Parks’ business operations

point of view

It was a little more than two years ago when we first started writing

about transparency at the Niagara Parks Commission’ a lack of transparency, to be more precise.

We urged the commission to be more open with its dealings. We sought permission to attend NPC meetings, long closed to the public, and were rebuffed. We supported the efforts of Niagara Falls MPP Kim Craitor, who introduced a private members’ bill to force the NPC and similar government bodies to lift the veil of secrecy on their proceedings.

We have repeatedly chastised the Dalton McGuinty government for talking a good game when it comes to open government, but failing to deliver on the promises.

And we were behind Niagara Falls businessman Bob Gale’s attempts to shed some light on the closed-door operations of the NPC, both as a commissioner and later through his complaints to the Ontario Integrity Commissioner.

A lot of attempts to change the NPC have failed. The public is still not welcome at commission meetings. Craitor’s bill, which he says will soon be re-introduced, has so far gone nowhere. The Liberals are still speaking from both sides of their mouth when it comes to transparency. But at least Gale managed to move the glacier a little bit through Integrity Commissioner Lynn Morrison.

Morrison’s office released her long awaited report following the complaint filed in July by Gale, who was a member of the Niagara Parks Commission then. He objected to the way his own commission renewed a 25-year lease with the Maid of the Mist Steamboat Co., without inviting other private companies to bid on the contract. The Maid of the Mist leases land from the parks commission on the Canadian shore of the Niagara River to run its boat tours.

When Morrison released the findings Monday, they included six recommendations the government should adopt to provide robust transparent oversight of the parks commission.

These include:

* A review of procurement and lease processes to determine whether the NPC’s policies and controls are appropriate and consistent with best practices;

* An audit of recent procurement practices along with a report to indicate if there are any instances where procurement was not consistent with best practice;

The Ministry of Tourism will provide guidance to the NPC to facilitate more open and accountable behaviours with respect to their business decisions.

Morrison also recommends that in the course of the ministry review, the NPC board be given the opportunity to review its decision with the benefit of knowing the government’s expectations regarding revenue generating opportunities and sound agency governance and with full knowledge of all the expressions of interest received in relation to the boat-related tourist attraction in Niagara Falls. That remains open to interpretation. We’re hoping it is bureaucrat-speak for: Go back and review how you renewed that lease.

Gale, who we still believe should be reappointed to the parks commission, said he got involved in the process so that there would be change.

It has taken some time, but this report sets forward the process for change to occur, thanks in large part to his complaint.

The report lays out what could become the foundation of and transparent, open and accessible Niagara Parks Commission.

The government needs to seize the opportunity to ensure that’s exactly what happens.

Article ID# 1481205