McGuinty hands out “awards’ to praise his massive waste of Ontarian’s Tax Dollars!: Part 1 & 2

Posted: December 5, 2012 in Uncategorized

It just gets worse!……………….. a Billion here, 2.5 Billion there, what seems to be the problem fellow Ontarians?………it’s only $$$$$$$$$$$$……………your dollars!

The driving forces behind these actions must be out and out greed!

McGuinty and Gang may be hiding out from the Opposition but they sure are visible within their own “stakeholders/partners” (that’s the way they describe their back room buddies who get our $$$) meetings and in this case, “conference/awards ceremony” .

If you find trying to follow the bouncing ball of Ontario’s deficit after a hard day’s work (if your even lucky enough to have a job in Ontario) and come up with just a really bad migraine, you won’t be alone.

The language that McGuinty has introduced to label his money-spending schemes is almost surreal for anyone other than the most astute Financial “players” who have made “finances” their life long vocation!

McGuinty depends on that. Don’t really tell people what your actually doing with their money, just dress it up like a noble cause and get on with the cheque writing!

After all, he’s using a public debit card with NO LIMIT!

Here’s part 1 of two exposes on The Infrastructure Ontario program and the Private Public Partnership program that has squandered billions of our dollars on projects that appear to favour the Liberal “hotspots” of Ontario. If you aren’t a Lib lover……….get to the back of the bus!

McGuinty brags about “PPPing” our tax dollars away! Part 1.

 Parker Gallant’s latest looks at Public Private Partnerships, Infrastructure Ontario, transparency and accountability .

The 2012 Canadian Council of Public Private Partnerships (CCPPP) National Conference was held November 26thand 27th in Toronto and had an illuminating list of speakers including the current Premier of Ontario, Dalton McGuinty as well as Infrastructure Ontario (IO) participants.

The Conference handed out awards and one of the “Silver Award Winners”, was an Ontario project; the “Humber River Regional Hospital New Acute Care Facility”. Humber River Hospital has three locations and two emergency centres and is to be a 1.6 million sq. foot facility. The award was shared with the Fort St. John Hospital and Residential Care Project (B.C.) for “Project Finance”. The IO project made the B.C. project pale in respect to overall costs at $1.75 billion versus $301.8 million. Now if one delves further into the benefits of that $1.75 billion spent to improve the services (and win the “Silver” Award) of the Humber River Regional Hospital you note some interesting side stories! The actual cost is $2.59 billion over the term of the contract and the $1.75 billion is in “today’s” dollars. The new hospital will contain 1.6 million sq. feet so in today’s dollars it is costing Ontario’s taxpayers $1,094 per sq. foot to build and over the terms of the contract the cost jumps to $1,744 per sq. foot and that is for 656 beds increasing accommodations by 107 beds or over $16 million for each additional bed. The Humber River Hospital also falls short of the Ontario average in respect to emergency wait times so as an outsider looking in I am at a loss to understand why a project still under construction and above average emergency wait times, should win the “silver” award.

A couple of other Infrastructure Ontario projects that haven’t won any awards and are unlikely to win any awards (except perhaps for highest costs) would be the Belleville Court House which is costing taxpayers almost $1,600 per sq. foot. The new MaRS Discovery District building “Phase 2” (a stone’s throw from Queens Park) is reputedly only costing Ontario taxpayers $344 million or about $460 per sq. foot which seems cheap by comparison to the “Taj Mahal” like costs of the Bellville Court House. The costs of the MaRS building also don’t include what is a further advance from IO of about $75 million to build out the top 4 floors of the 20 story building at a cost of $450 per square foot for “Public Health Ontario” (PHO). PHO was an outcome of the SARS outbreak founded by the Liberal’s in 2007 and now has a staff of 950 located at 26 sites throughout the Province. So from the top floors of MaRS Phase 2, PHO’s staff will be able to look down on Queens Park in space that cost taxpayers over $900 per sq. foot whereas workers in the Scotia Plaza (in the heart of Toronto’s financial district) will be sitting in space that has an apparent value of only $635 per sq. foot. Scotia Plaza with 2 million sq. feet sold for $1.27 billion in May 2012. It is not clear why the self described “most expensive real estate in Canada” on Bay Street should be cheaper then the MaRS Phase 2 building or the Belleville Court House but it is.
While the Phase 2 expansion of MaRS Discovery District appears cheaper then the Humber River Regional Hospital or the Bellville courthouse one must realize that MaRS is a charity and since its inception in 2005 has received: starting capital of $70 million from the Province of Ontario, the Federal government and the City of Toronto and since then has received a further $177 million in taxpayer funds mainly from the Province of Ontario. With liquid securities of only $32 million as at March 31, 2012 it is unclear where MaRS will come up with the required funds to cover the full cost of their new building as IO are reputedly providing only $230 million in financing leaving them short by over $80 million.
If one searches through the IO website the only reference to MaRS is in respect to the above mentioned financing for the PHO 4 floors in the list of projects file where the costs are estimated to be $50/100 million. If you go the “Loan Program Stats” you discover that there is no “charity” category so it was impossible to determine why or how IO can provide the “repayable loan” referenced in the MaRS press release of July 26, 2011 or the press release by Glen Murray, Minister of Research and Innovation.
As a result of the foregoing I reviewed the “Ontario Infrastructure and Lands Corporation Act 2011” and under section 4.2 of that Act was unable to discern how Infrastructure Ontario could lend money to a charity as the Actclearly identifies the Eligible Public organization(s) that would qualify and “charities” are not on the list. That led me to inquire directly with a spokesperson with IO who replied:

Mr. Gallant,
Infrastructure Ontario does not have a separate Sector Category for the MaRS loan in our Loan Management System, from which all of our loan statistics are retrieved. Therefore, the MaRS loan has been placed in the “Municipal Corporation” category on the Loan Program Statistics page on our website ( Infrastructure Ontario is currently upgrading our Loan Management System and we hope to be able to provide a more appropriate breakdown of the sectors in the future.
With respect to your question about the loan terms, Infrastructure Ontario treats the identity of individual loan clients and information regarding their loans as confidential. [Writer’s Note:Why, if these are all taxpayer owned institutions?General information about Infrastructure Ontario’s lending rates is available on our website.
Finally, here is some information that outlines where in the act MaRS is identified. Section 4(2) of the current Act defines who an eligible public organization is. Then subsection 10 of section 4(2) says that any organization that was prescribed under section 28(1)(a) of the old Act is also an eligible public organization. Section 28(1) of the old Act allows the lieutenant governor to make regulations under that Act specifying what public bodies may receive financing from IO. MaRS is listed in Ontario Regulation 220/08 under the OIPC Act as a public body that may receive financing from IO. See section 10.1 of that regulation:”

So once again when it comes to spending taxpayers dollars the “transparency” of the McGuinty Liberals gets shrouded in regulations that create opaqueness meant to hide the original intent of the Act.
If that intent was to give MaRS special treatment within the Act originally created to allow IO to become the financing arm of “public” infrastructure projects why didn’t the Liberals simply complete the process by declaring MaRS a Crown Corporation instead of a “charity” –  or would that have resulted in scrutiny that may have highlighted the fact that MaRS is nothing more that a means to push forward an agenda that is miles away from medical science and closer to a real estate venture.
In a review of the 38 projects on the IO list it is interesting to find that 18 (47%) of them are in the GTA and another 4 (11%) are in Ottawa. By dollar value ($10.225 billion) the GTA gets 58% and Ottawa 18%. Both Ottawa and the GTA are Liberal strongholds. As noted above the breakdown of the lending activity ($5.1 billion) in the IO website does not allow a similar analysis.
IO has been a consistent money loser since its inception (an accumulated loss of $196 million to March 31, 2010) as noted in an earlier article and the Province forgave $200 million of their debt as a “remission” under their then CEO, David Livingston. Livingston was subsequently appointed McGuinty’s “Chief of Staff” in the summer of 2011, while also being McGuinty’s ‘go to’ guy to resolve the Oakville gas plant move and the threatened law suit from TransCanada Energy.
To this taxpayer it sure looks like the McGuinty Liberals are doing a great job of p-p-p-ing away our tax dollars via the McGuinty Bank of Ontario.
Parker Gallant,
December 5, 2012

McGuinty and Infrastructure Ontario “PPPing” our tax dollars away Part II

On November 27, 2012 Dalton McGuinty delivered a rah, rah speech to the Canadian Council of Public Private Partnerships (CCPPP) at their National Conference in Toronto. Public private partnership (PPP) describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies.
McGuinty’s speech wasn’t long, however, in his opening remarks he managed to castigate Mike Harris, indirectly, by citing the usual drivel to justify driving up Ontario’s debt. He did this by speaking about the state of Ontario’s infrastructure when his government came to power by saying;
And in 2003, when our government came to office, infrastructure in Ontario was reaching that turning point. It was overstretched, under-maintained and showing its years.”
He then goes on about how when he grew up in a family of 10 kids they “made everything last, The cars, the washing machine, the clothes.”, and goes on to say; “Families are careful with their money. And they expect their government to invest wisely when it comes to buying or building anything new.”. He then follows this up with [French Translation] [This goes beyond a partisan issue. For more than 20 years, governments of all stripes put off spending on infrastructure. But in 2003, we were the government. And we had to fix it.]
The balance of the speech brags about how his government went about “fixing it”; stating they ”invested in 23 new hospitals”, “built over 500 new schools”, “built 7,500 kms of transmission and 10,000 MW of generation”, “built jails”, “courthouses”, “sports facilities and information technology projects.” He also provides the total infrastructure spending number which he claims is $75 billion. In his speech he attempts to justify the spending by stating it “adds up to about 100,000 jobs per year that our government keeps creating in construction.”

If one does the math on the foregoing the spending on infrastructure equates to about $83,000 per person year per job. This spending was achieved with borrowed money so doesn’t include: the interest costs on the $75 billion, the billions in dollars required to pay the thousands of teachers that now occupy those 500 new schools, or the costs of electricity that has more then doubled in the Province and driven jobs and tax dollars away. It also doesn’t account for the fact that most school boards now are forced to close schools, for lack of enrolment, nor the increased wait times at the emergency rooms of those 23 new hospitals. He fails to indicate if they (the Liberal Party) demonstrated any foresight or completed any cost/benefit studies that taxpayers would expect to justify this spending?
Most of the spending on infrastructure that McGuinty referenced has been done under the auspices of a McGuinty creation; Infrastructure Ontario (IO) which until the summer of 2011 was headed up by David Livingston, McGuinty’s current Chief of Staff.  McGuinty’s speech brags about the current “79 capital projects valued at $30 billion using the AFP [Alternative Finance & Procurement] method.” by IO and commends David Livingston “for so capably translating our government’s vision into reality.” He refers to IO as “an extraordinary organization” and that “IO has proven to be respectful, resourceful, results driven and responsible.” He goes on to say to his audience “And thanks to your hard work, the program has consistently come in under budget.”
Now when one is complimented for coming “in under budget” it is always appropriate to compare the results with a budget that had been set; but no evidence exists (to the writer’s knowledge) that a budget was set or that a “proper” cost benefit study was actually done on the concept of public private partnerships as envisaged by the governing party and ultimately created under IO.  It is my belief that any and all, calls for tenders on the IO managed projects were and still are, based on the PPP model using the AFP method.  It is beyond belief that a courthouse, such as the one being built in Belleville would cost $1,600 per square foot or almost triple what was recently paid for Scotia Plaza at the corner of King & Bays Streets. Likewise the costs to build the Humber River Regional Hospital New Acute Care Facility as compared to, say, new US hospital builds where costs are $250/$400 per square foot should be $1,094 per sq. foot (current dollars) or from two and a half (2 ½) to four (4) times more to build in Ontario.
How the Premier of what once was the “engine of Canada” can brag openly about the wonders of Infrastructure Ontario shows the vacuum he and the Liberal Party of Ontario have been operating in.
Based on Premier McGuinty’s comments about the austerity practiced by his parents it appears as if they were disciplined and understood the value of money.  Their son appears to have learned nothing from them. Armed with the Ontario taxpayers to pick up the costs, he hasn’t hesitated at buying, metaphorically speaking; that “new car” or “new washing machine” on the backs of Ontarians. Hopefully for the sake of the McGuinty household it is his wife that manages the Dalton McGuinty family budget!
McGuinty has not been careful with our money and he certainly has not “invested wisely” in our health system, (e-Health plus Ornge plus longer wait times), our energy system (useless wind turbines and gas plant moves and doubled electricty rates), our schools (striking teachers and school closings) or our infrastructure (Toronto is still waiting for the airport rail line and the cancelled Ontario Northland Railway).
Premier McGuinty’s closing remarks in his speech thanks his audience by saying; “You’ve left a great legacy and I thank you for that.” The taxpayers of Ontario unfortunately will not be saying that of the Premier as they will be left with the accumulated legacy of debt for which he will not receive any thanks from Ontario’s taxpayers.
Parker Gallant
December 7, 2012

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