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From the Star:
Council blindsided by pay cut that wasn't
Mississauga slashed salaries on its hydro board in April, but councillors find out it's not that simple
Sep 27, 2007 04:30 AM
Phinjo Gombu
Staff Reporter
Several Mississauga councillors were livid yesterday to learn, five months after they slashed hefty wages on the board of Mississauga's hydro utility, that they had actually done no such thing.
As that realization slowly dawned on them during a routine council discussion – over a consultant's report recommending higher pay at Enersource than councillors initially ordered – their surprise soon turned to anger.
How could such a thing happen?
The story begins in April, when, with Councillor Carolyn Parrish leading the charge, they decided the 10-member Enersource board was overpaid and underworked.
They voted to cut the salary of its chair from $70,000 to $40,000 a year and those of citizen representatives and politicians from as much as $44,000 to $15,000.
The hidden problem: While the city owns 90 per cent of Enersource, 10 per cent belongs to the investment company Borealis Infrastructure, which had its own opinions on the matter.
The move grabbed a lot of attention, especially because Mayor Hazel McCallion defused the unaccustomed rebellion from her council – voted on while she was conveniently away in China – by voluntarily giving up all of the $32,000 annual pay she'd received for sitting on the board. McCallion agreed politicians were earning too much for their Enersource service.
But yesterday, as councillors were pondering the pay raise recommended in the Enersource consultant's report, city lawyer Mary Ellen Bench quietly advised that they were headed for a stalemate if they rejected the idea.
To the surprise of most councillors, the original shareholder's agreement between the city and Borealis clearly states any pay cut requires agreement from both.
Borealis, Bench told them, didn't agree.
And without Borealis's approval, the salaries would go back to what they were before.
While most councillors believed the pay cuts had taken effect, the Enersource board had simply docked their own pay while their consultant did a salary comparison and wrote recommendations.
What's more, the three city councillors sitting on the board had joined the unanimous vote to refuse the cuts: Carmon Corbasson, Sue McFadden and Nando Iannica.
"Council had no idea that the pay cut had not come into effect until today," Parrish said after the meeting, calling the whole situation a power play by Borealis against city council. "This is unbelievable."
With that began the finger pointing, blaming and name-calling that appears certain to end in an expensive court battle with Borealis.
Councillors such as Frank Dale and George Carlson chimed in, blaming the city manager and solicitor for not telling them about the clause before the April vote – and girding for battle with a board they say has overstepped its bounds.
"We own this company lock stock and barrel except for this bogus 10 per cent that Borealis has," said a furious Carlson. "If we have to buy them out and get rid of them, and put in a new board, I'd be in favour."
Corbasson, who excused herself from the debate because she's on the Enersource board, said she couldn't speak for her colleagues – but she knew of the pay cut clause. "I don't know why councillors didn't know," she said.
City manager Janice Baker insisted she and her staff weren't to blame for the debacle. Bench, she said, had verbally told councillors about the clause, but in the rush to order the cuts through, they hadn't given staff enough time to prepare a report outlining the consequences.
There was some irony in Baker's response, because it was only a few months before that April vote that council had ditched her as a city rep on the Enersource board – depriving her of $32,000 pay.
"I think we could have helped more in the issue if we had been given the opportunity to complete the work we had initially been asked to do," said Baker.
Chortling through this whole thing was McCallion, who was halfway around the world when councillors voted to cut the salaries.
The mayor couldn't help but enjoy the mess councillors found themselves in, because she had always felt non-politicians on the board needed to be paid well – and disagreed with removing Baker.
"Sometimes we have to do our homework," she said, clearly taking pleasure at how council had painted itself into a corner where it had no choice but to battle Enersource on the pay cuts issue.
Councillor Pat Saito plans to file a motion Oct. 10 to ensure the pay cuts are implemented. "I expect," she said, "a lively discussion."
AoD
Council blindsided by pay cut that wasn't
Mississauga slashed salaries on its hydro board in April, but councillors find out it's not that simple
Sep 27, 2007 04:30 AM
Phinjo Gombu
Staff Reporter
Several Mississauga councillors were livid yesterday to learn, five months after they slashed hefty wages on the board of Mississauga's hydro utility, that they had actually done no such thing.
As that realization slowly dawned on them during a routine council discussion – over a consultant's report recommending higher pay at Enersource than councillors initially ordered – their surprise soon turned to anger.
How could such a thing happen?
The story begins in April, when, with Councillor Carolyn Parrish leading the charge, they decided the 10-member Enersource board was overpaid and underworked.
They voted to cut the salary of its chair from $70,000 to $40,000 a year and those of citizen representatives and politicians from as much as $44,000 to $15,000.
The hidden problem: While the city owns 90 per cent of Enersource, 10 per cent belongs to the investment company Borealis Infrastructure, which had its own opinions on the matter.
The move grabbed a lot of attention, especially because Mayor Hazel McCallion defused the unaccustomed rebellion from her council – voted on while she was conveniently away in China – by voluntarily giving up all of the $32,000 annual pay she'd received for sitting on the board. McCallion agreed politicians were earning too much for their Enersource service.
But yesterday, as councillors were pondering the pay raise recommended in the Enersource consultant's report, city lawyer Mary Ellen Bench quietly advised that they were headed for a stalemate if they rejected the idea.
To the surprise of most councillors, the original shareholder's agreement between the city and Borealis clearly states any pay cut requires agreement from both.
Borealis, Bench told them, didn't agree.
And without Borealis's approval, the salaries would go back to what they were before.
While most councillors believed the pay cuts had taken effect, the Enersource board had simply docked their own pay while their consultant did a salary comparison and wrote recommendations.
What's more, the three city councillors sitting on the board had joined the unanimous vote to refuse the cuts: Carmon Corbasson, Sue McFadden and Nando Iannica.
"Council had no idea that the pay cut had not come into effect until today," Parrish said after the meeting, calling the whole situation a power play by Borealis against city council. "This is unbelievable."
With that began the finger pointing, blaming and name-calling that appears certain to end in an expensive court battle with Borealis.
Councillors such as Frank Dale and George Carlson chimed in, blaming the city manager and solicitor for not telling them about the clause before the April vote – and girding for battle with a board they say has overstepped its bounds.
"We own this company lock stock and barrel except for this bogus 10 per cent that Borealis has," said a furious Carlson. "If we have to buy them out and get rid of them, and put in a new board, I'd be in favour."
Corbasson, who excused herself from the debate because she's on the Enersource board, said she couldn't speak for her colleagues – but she knew of the pay cut clause. "I don't know why councillors didn't know," she said.
City manager Janice Baker insisted she and her staff weren't to blame for the debacle. Bench, she said, had verbally told councillors about the clause, but in the rush to order the cuts through, they hadn't given staff enough time to prepare a report outlining the consequences.
There was some irony in Baker's response, because it was only a few months before that April vote that council had ditched her as a city rep on the Enersource board – depriving her of $32,000 pay.
"I think we could have helped more in the issue if we had been given the opportunity to complete the work we had initially been asked to do," said Baker.
Chortling through this whole thing was McCallion, who was halfway around the world when councillors voted to cut the salaries.
The mayor couldn't help but enjoy the mess councillors found themselves in, because she had always felt non-politicians on the board needed to be paid well – and disagreed with removing Baker.
"Sometimes we have to do our homework," she said, clearly taking pleasure at how council had painted itself into a corner where it had no choice but to battle Enersource on the pay cuts issue.
Councillor Pat Saito plans to file a motion Oct. 10 to ensure the pay cuts are implemented. "I expect," she said, "a lively discussion."
AoD
