The Ernst & Young audit report on the fire-station construction fiasco has finally seen the light of day. It doesn't look pretty and it emanates a distinctly unpleasant odour; an odour of rot festering in the political and administrative bowels of power at city hall.
The report outlines a number of concerns that deal with administrative process and oversight, but the most concerning issues identified (albeit process-related) strike at the very heart of the free enterprise system as well as citizen and business trust.
The city is not in a position to perform much of the work on projects it finances and thus hires contractors to perform those tasks. That process of hiring such contractors must be fair and equitable and put all bidders on an equal footing.
At the core of many municipal corruption scandals is the bypassing of such processes. Some bidders are given, or gain an unfair advantage, by having access to confidential information not available to other bidders. According to the Ernst & Young report, Shindico had such an advantage in the fire-station affair.
In most cases, where one party gains an unfair advantage they will realize an increase in profits and reciprocate with some form of quid pro quo. Usually, when what amounts to industrial intelligence flows one way, kickbacks flow the other way.
The Charbonneau Commission in Quebec emphasizes that point. The Ernst & Young report does not suggest there were any kickbacks in the fire-station fiasco.
Determination of whether there was any quid pro quo goes beyond the scope of an audit and would require an in-depth criminal investigation or a commission of inquiry. It would be highly unusual for any of the principals at the heart of an audit to come out and make a 'mea culpa' declaration.
What is power?
Power is the ability to influence the actions of others. An example of the exercise of power could be a municipal mayor who, when selecting a CAO, prevails on the other members of the selection committee to select the candidate of his choice. In such an instance, the mayor does not have the authority to order members of the selection committee to take a particular position, but he, nonetheless, has power as he controls appointments to the committee.
What is authority?
Authority is the legal right to act. In the case at hand, the CAO was given legal authority to undertake a wide variety of actions on behalf of the city under guidelines laid down by council.
Concentration of power
When Phil Sheegl was appointed CAO, Mayor Sam Katz bristled at the suggestion he was not qualified to perform the function. The Ernst & Young report suggests the mayor's detractors were spot on. As well, the mayor would have us believe he and the former CAO, although they are close friends, do not have discussions about city-related issues such as the fire-station fiasco and the related land swaps. Do these two buddies look like they hold much back from each other?
It is clear that when the mayor appoints a 'Mini Me' CAO, there is a dangerous convergence of power and authority. It puts the mayor in the position of wielding political power, as well as administrative authority by proxy.
The next Mini Me
The mayor has already indicated his choice to fill the CAO's chair in an acting capacity is Deepak Joshi -- yes, the same Deepak Joshi named in the Ernst & Young report. One would have hoped the members of EPC would have learned from the last appointment that the mayor's choice may not be the best choice. We cannot afford another Mini Me CAO.
What's to be done?
It's time Winnipeggers wake up to the realization Mayor Katz may actually have been truthful when he said he was a businessman and not a politician. The problem may be that he views the City of Winnipeg as his business -- his own little fiefdom -- putting in place cronies to help him run his business.
That raises the question: To whose benefit is the city being run -- the citizens' benefit or the mayor's benefit? To a degree, we are all responsible for what is happening at city hall: We elected Katz -- not once but several times. It may be time for like-minded people to get together and initiate a movement under the banner "ANYONE BUT SAM" and clean up the mess at city hall.
Menno Zacharias retired from the Winnipeg Police Service in 2008 having served as deputy chief for seven years. He holds a master's degree (MPA) from the University of Manitoba, and is a graduate of the FBI National Academy. He currently teaches a policing course at the University of Winnipeg. He blogs at mennozacharias.com.