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This article was published 22/1/2015 (2305 days ago), so information in it may no longer be current.
Red River College officials have asked Winnipeg police to investigate how marble from its culinary arts building wound up in a renovated kitchen in the Wellington Crescent home of its former president and CEO, Stephanie Forsyth.
Lloyd Schreyer, chairman of the college's board of governors, made a statement Wednesday.
"...The board made the decision to engage Winnipeg police to undertake a review of the allegations."
The revelation came as Education and Advanced Learning Minister Peter Bjornson released a report into questionable expense claims and management practices by Forsyth and former members of college management.
The report says rules governing expense claims were weakened or sloppily enforced during Forsyth's tenure, undermining accountability for the use of public funds.
Forsyth parted company with the college in September after four years. The review covered the period from September 2010 to May 2014.
'The fact that rules were bent, the fact that an individual had circumvented the rules, that is really disconcerting'‐ Education and Advanced Learning Minister Peter Bjornson
Forsyth has not granted interviews since leaving the college at the end of August. Messages left with her spouse in Penticton, B.C., on Wednesday were not returned. Red River said it did not have contact information for Forsyth or her lawyer.
The review found some of her expenses were questionable and others lacked supporting documentation and proper receipts.
Of 88 expenses reviewed, eight were not signed by the president certifying that the expenses claimed were true (of those, seven were approved), and 18 had incomplete supporting documentation.
Missing receipts for 18 claims totalled about $2,350, including items such as taxis, books, meals, a flight and an $850 registration fee.
The report found some meal, conference and transportation expenses that should have been paid and claimed by Forsyth as the senior staff member at an event were claimed by other RRC staff. This resulted in the former president approving expenses that she herself incurred. (Forsyth could approve senior staff expenses, but had to submit her own expenses to the board chair.)
The review, carried out by a unit in the provincial Finance Department and the Manitoba Civil Service Commission, also noted inaccuracies in the expenses incurred by Forsyth that were posted online. It found her expenses dropped 26 per cent the year after they began to be posted online.
The review said some items Forsyth claimed were "questionable," including: $2,219 for dinner on three consecutive evenings at an upscale restaurant to hold job interviews; and an invoice for $11,515 for a membership in a French culinary institute alliance. "It was also not clear why three staff, including the president, were required to visit the facility in France in order to become a member of the alliance when a smaller delegation may have been sufficient," the report said.
The report said 16 senior managers left their jobs during Forsyth's tenure -- only one had left in the previous five years, and that by mutual consent. Of the departures, Forsyth fired eight of them, including three who were among the 17 senior managers she hired during her tenure, and without filing any record of just cause. She increased the management team by one position.
The president had discretion to fire and hire senior employees, said the report. "None of the incident or personnel files demonstrated that the terminations were for just cause. Some of the terminated employees were met with to discuss issues, style, expectations, and then terminated one to two months later. It was unclear from the documentation in the files what (if any) opportunity the employees were given to improve their performance."
Red River has always refused to discuss severance, but the province said the eight fired managers received a total of $639,142.46, plus an additional $6,000 each to help find new jobs.
Forsyth also contracted out $379,931.92 for human resources services. Some of the expenses, such as Winnipeg Symphony Orchestra tickets, included Forsyth's partner as a beneficiary.
The former president travelled to B.C. -- from where Red River had hired her -- to hire a consultant without tender for $54,525. She hired someone the report described as in "a close donor relationship" for $25,000, at an hourly rate of $375 compared with a normal $40-an-hour for the job. And she hired a former colleague from B.C. as a vice-president before Red River had posted the job, the report said.
Bjornson said Wednesday he found the betrayal of public trust concerning. "The fact that rules were bent, the fact that an individual had circumvented the rules, that is really disconcerting."
He would not comment on a potential police probe, but said he would introduce legislation to ensure the college follows proper administrative practices. "What we have learned from this is that tighter checks and balances and policies and procedures need to be implemented."
Schreyer, who joined the RRC board and became chairman Oct. 1, after Forsyth left, said the college has no plans to sue her over the expenses. He wouldn't rule out legal action over allegations that marble was installed in her home, which Forsyth sold last fall.
"We do not have all of the answers to the marble, and we haven't been able to get the answers to the marble," he said Wednesday.
He said of the report's 45 recommendations for improving the college's financial and management controls, 23 have been implemented and RRC is "well on the way" to dealing with the rest.
Schreyer would not disclose whether Forsyth received a severance. He said the former president and the college parted ways by mutual agreement, and the terms included a confidentiality clause. However, the report noted a major factor in Red River's projected deficit of $2 million for the fiscal year ending June 30 was higher-than-anticipated severance pay.
We knew about former Red River College president Stephanie Forsyth claiming golf shoes as an expense, ending up with college marble in her kitchen, and having a revolving door on the senior administration offices.
But those were just the start. Some of the lowlights that the provincial government investigation -- available below -- found from September 2010 to May 2014:
- Other employees claimed $5,144.97 in expenses which Forsyth incurred, including $450 for Forsyth and her partner's tickets to the Winnipeg Symphony Orchestra and a donation to the WSO.
- In 2011, Forsyth submitted a car-rental receipt taken out a day before she arrived by air in B.C.; the car ferry receipt covered two unnamed individuals.
- Forsyth repaid $205 for golf shoes, but filed claims over and above her four per cent discretionary spending, totalling $1,100 for books, phone chargers and a GPS unit.
- There were surcharges of $3,000 for unexplained changes to flights.
- Forsyth's expenses rose by 19 per cent in 2012-2013 to $32,993, but fell 26 per cent the following year after she had to report expenses online. Forsyth received a $1,000-a-month car allowance, and four per cent of her salary, around $10,000, was for discretionary spending, which she didn't have to report.
- "Two untendered contracts for a consultant from B.C. with the first contract ($14,525) subsequently increased by $40,000 using a second contract, for a total of $54,525. The contracts were signed by the president and a vice-president. The justification noted 'the right fit' and 'perfect mix of qualifications.' Assessing qualifications in a fair and equitable manner would require tendering. The president travelled to B.C. to meet with the consultant prior to them coming to Winnipeg and work was commenced before the initial contract was signed."
- A $25,000 curriculum contract was awarded without tender to someone in a "close donor relationship" at a rate of $375 an hour, compared with the normal $40 an hour; the individual did not teach all of the course material.
- Forsyth submitted 18 expense forms totalling $2,350 with no supporting receipts.
- "Our review of the president's expenses noted that some items claimed were questionable given the public's expectation of fiscal prudence for publicly funded organization": $2,219 for three evenings of job interviews at an upscale restaurant, meals involving only college personnel, events held at the president's house without any details filed.
- Expense claims were approved for purchases signed by her spouse, including wine, car repairs.
- "The construction/renovation of the Union Bank Tower (into culinary arts school and student residence)... was not managed effectively as there were 138 change orders totalling $11.5 million... instances where proper justification was lacking for untendered contracts, including contracts signed by the president; extensions of contracts to potentially avoid tendering thresholds; and some contracts being signed after the services had already been provided and/or invoiced."
- "The Union Bank Tower Project actual construction costs of approximately $37.5 million significantly exceeded the original budget of $22.5 million."
- "Instances of potentially questionable fiscal prudence or general propriety such as the choice of restaurant, entertainment at home, and various miscellaneous discretionary expenses claimed by the president while also receiving an additional allowance of four per cent of base salary ($10,000) for the purpose of discretionary expenses."
- Severance cost for former senior staff was $3.417 million in 2013-2014 alone.
- The nursing budget was $1.8 million over budget in the summer of 2014.
- the college "inappropriately reduced" the anticipated amount the new union contract would cost, helping result in the $2 million deficit last year which college officials believed was unprecedented.
- In Forsyth's four years, 16 vice-presidents and other senior administrators left, of whom eight were fired with severance packages totalling $639,142.46 -- Forsyth had recruited three of them. The remainder were retirements and end of contracts. In the previous five years, one senior manager left, by mutual agreement. Meanwhile, Forsyth appointed 17 senior managers, increasing the team by one overall position.
- The president purchased two Blue Bomber tickets in July of 2011 as hospitality for unnamed recipients.
- A magazine of which the president's partner was chair received a $750 discount to a college event which was not offered to other groups.
- Forsyth did not sign eight expense claims certifying they were true and correct; the board chair approved seven of them.
- gifts exceeding the $100 limit, $1,199 for gifts purchased in B.C, for unnamed recipients
- Twice the president claimed airport lounge fees for herself and unnamed others, without specifying if the layover took at least the minimum three hours required by college policy.
- The current financial reports received by the BOG (board of governors) do not appear to provide sufficient detailed information for the BOG to accurately determine the College's current financial position.
- Some of the president's expenses were not signed, were not reported to the BOG, or were reported by other staff on their own expenses which Forsyth herself had to approve.
- "The BOG should clarify the purpose and use of the president's annual discretionary expense allowance, and ensure the president does not submit expense claims related to incidentals which would be expected to be covered by the allowance"
- Eighteen of 48 contracts for the Union Bank Tower were untendered and lacked sufficient documentation. "Not tendering a contract and awarding it to a company solely because they have done previous work for RRC is not a valid reason."
- "Three untendered contracts ($202,200) contained justification that stated previous experience with the contractor, which is not adequate justification and would not meet the test of public scrutiny."
- "There was no formal risk management plan for the (Union Bank Tower) project and there were some unforeseen costs and situations encountered that caused both delays and additional expenses during the project, approximately $1.3 million in total"
- Culinary arts projections for tuition and sales were too aggressive.
- While RRC has refused to discuss severance pay, by June of 2011 severance for unspecified employees was already $3,082,000 amortized over nine years.
- Three vice-presidents were hired in 2012 using the same B.C.-based recruitment firm which had recommended hiring Forsyth. One new VP who had previously worked in B.C. at the same school as Forsyth, was hired on a contract nine months before the job he assumed at Red River was posted.
- "There was not a clear justification for why terminations were warranted and payments made."
- Additionally, in this time period, RRC has paid $379,931.92 in contracting for human resource functions.
Larry Kusch didn’t know what he wanted to do with his life until he attended a high school newspaper editor’s workshop in Regina in the summer of 1969 and listened to a university student speak glowingly about the journalism program at Carleton University in Ottawa.