Political Analyst and Observer, Bill Longworth's, Weekly "Eye on City Hall" Columns, as published in Oshawa, Ontario, Canada's Oshawa Central Newspaper

Monday, January 24, 2011

A Giant Windfall Payday for the City's “Fired” Politicians

“Eye on City Hall”

A column of Information, Analysis, Comment, and unfiltered opinion
reprinted from Oshawa Central Newspaper

Bill Longworth, City Hall Reporter
January 24, 2011

Mayor John Henry’s campaign literature stated the city needed new, principled leadership at city hall and that he’d promote new accountability, transparency, and economic growth for the city.

In terms of the principled leadership promised, I’ve heard on good authority that Henry has been dragging his feet on meeting with COSCO officials regarding expansion into Oshawa since COSCO’s cut-rate on-site pharmacies would steal business from his wife’s pharmacy.

If this is true, putting his family’s self interest first is inconsistent with his promise of restoring respect for the taxpayer and providing accountable leadership at city hall. It sounds more like Chicago politics under infamous Richard J. Daley’s iron fisted and corrupt administration.

Mayor John Henry’s leadership has not enjoyed the customary “Honeymoon Period” always afforded new office holders. In Henry’s case, it was a record short-lived honeymoon as even many of his former avid supporters are now his critics.

Council’s indecisiveness in replacing disgraced Mike Nicholson’s abandoned council seat speaks volumes about council productivity and the mayor’s leadership. Since the city wide vote is undemocratic which depends upon voter knowledge of candidates, I do support council appointment to fill the vacancy out of fear that, in an election, many unwary Oshawa voters would jump off the turnip truck and elect Brian Nicholson or Mary Anne Sholdra.

Appointment does, however, remove the possibility that city council could seek public opinion on the general vote election system that was highly criticized by the majority of city voters. Fixing the election system would be a first action by a council truly interested in democracy.

Accountability and transparency is still a major question with city council, as it is with all governments, despite the fact that all elected city politicians promised a more open and accountable council. Sadly, what we have has not changed in this regard.

A prime example of this lack of transparency has to do with the severance payments received by retiring and defeated politicians. While information on this has recently been released on city Report FA-11-14 published on the January 20, 2011, Finance and Administration Committee Meeting Agenda available on the city web page, the report only gives half of the story hiding the full payout amounts no doubt to mitigate citizen anger at the largesse politicians serve themselves at taxpayer expense.

Section 242(1) of the Municipal Act, R.S.O. 1990, c.M.45, provides that a municipality may pass by-laws for paying remuneration to the members of Council, and such remuneration may be determined in any manner that Council considers advisable.

Because of the breadth of remuneration permitted by this law (anything Council considers advisable!), the parting allowance itself does not tell the full story of compensations and benefits provided.

And getting a clear answer to the full benefits is virtually impossible to establish....whether severance allowances, like politician’s salaries, are 1/3 tax free, whether there are monthly pensions when age requirements are met, whether drug and other health benefits are provided, whether equipment like computers, cell phones, and other electronic equipment were inventoried and had to be returned....and these questions could go on ad infinitum. Answers require very specific questions with no information being voluntarily provided.

I first requested disclosure of the severance amounts from the city clerk’s office on November 8, 2010, and was told the info would be published in an annual report in the first quarter of 2011 and that I’d have to file a Freedom of Information request (FOI) to see it earlier, direction I received on two subsequent occasions, although they couldn`t tell me the cost to provide this information they had at hand, having already written the cheques for the huge amounts.

Finally on Jan 8, 2011, in response to a threat to finally file a FOI request and to a comment from me that the giant lack of transparency in a council purportedly operating on policies of openness, accountability, and transparency would be a huge revelation to the general public, Percy Luther, of the Clerk`s Department, informed me that he had looked into this further, as I had requested, and informed me of the disclosure report FA-11-14 mentioned earlier.

City policy calls for political severance allowances of one month`s salary for every year of council experience. City severance allowances thus generated were: John Gray, $110,821.33; J. Kolodzie, $57,042.00; L. Parkes, $45,950 + $34,759 unclaimed retroactive pay when she campaigned as Federal Liberal Candidate during the period Dec. 2004 to Nov. 2006; A. Cullen, $21,072.92 + an MBA; R. Lutczyk, $22,183.00; and B. Nicholson, $22,183.00. Mary Anne Sholdra did not serve on council long enough to qualify for any severance allowance.

These handsome figures are only part of the story and don`t include Regional severance allowances nor do they include tax-free pay provisions, or any health or pension benefits outlined earlier.

Durham Region figures have not been published and these figures are much more difficult to establish than city severance allowances.

My first request for the figures resulted in the Regional Clerks department sending me the first page only of the Severance Benefits By-law (Number 61-93) which gave a preamble but didn’t get to any details of the severance allowance. In the end, they turn out to be the same as Oshawa`s policy in providing one month’s salary for every year of regional council experience up to a maximum 18 month's salary.

So secretive are the Regional Political severance allowances that it’d probably be easier obtaining top secret classified military intelligence. Getting information is not helped by the general lack of co-operation by Regional bureaucrats who dragged their feet at every instance often neglecting my requests for information. Information finally provided was not compiled into a single place and required extrapolating info from a number of separate sources.

Regional officials couldn’t help by simply running me off a computerized list of severance cheques already printed and distributed. That would make it too easy and the public must be forced to dig for information. Transparency is only a word, not a practice!

The experience list provided me recorded 22 years of experience for Brian Nicholson qualifying him for the maximum 18 months of salary. They didn’t seem to remember that he had a break in service with his defeat in 2000 and presumably collected 15 month’s severance at that time. Since the maximum payout allowed by the policy is 18 months salary, he presumably would only be eligible for an additional 3 years with his October 25, 2010 defeat.

Because Nicholson’s defeat was overlooked in the figures given me, I surmise that he has double dipped for a giant overpayment, collecting 15 month’s severance in year 2000 and the maximum 18 months on his recent defeat.

A request to Durham Region Payroll Officer, Joanne Cermak, to confirm Nicholson`s payout, went unanswered. Nor did she answer my other queries whether the payouts are 1/3 tax free or if politicians can claim any other entitlements, compensations, or retirement benefits such as pensions payable at some defined age of eligibility, health benefits, etc., all in addition to the handsome cash severance packages they received.

Based on 2009 Regional Salaries (and not the 2010 salaries that would have been used) the minimum Regional payouts to retiring/defeated Regional reps from Oshawa are: John Gray (16 months credit+ committee Chair = $69807); Joe Kolodzie (max 18 months credit = $69533); Brian Nicholson (if only 3 months credit based on payout remaining after 2000 election defeat and break in service = $11589 or $69533 if break in service and 2000 payout forgotten about in which case there`s been an overpayment of $57944----but what the hell, it`s only taxpayer money!); Robt. Lutczyk (10 months credit = $38629); April Cullen (7 months credit + Committee Chair = $30540).

So combined Regional and City severance WINDFALL allowances for our retiring and defeated politicians are as follows: John Gray $180628, Joe Kolodzie $126575, Brian Nicholson $33762 (or $91786 if Region overlooked Nicholson’s 2000 defeat and collection of eligible severance at that time), Robert Lutczyk $60812, April Cullen $51613 + that MBA.

So the best estimate of taxpayer payout to fired and retired councillors is a minimum $453,000, almost half a million of your taxes, maybe money well spent to get rid of these politicians.

Remarkably, these total severance allowances are worth about the equivalent of $3/4 million to the politicians if the allowances are 1/3 tax free as is their regular salary.

And hey, all of these payouts were unbudgeted and so were paid for from “found money,” that fat, waste, and excess I’ve written about so often---the fat, waste and excess that I suggested cutting by 3% during the election campaign....and the fat, waste, and excess politicians will pad by whatever percentage tax increase they hit you with this year!

Don’t worry! Be Happy! But pay those taxes!

Be sure to follow Bill’s radio broadcasts, “Eye on City Hall”,
every Monday, 6-9 pm EST, on http://www.ocentral.com/thewave/

A week after my unanswered request and days after my column deadline time, i received the following email which provides some, but not all, of the information previously requested that has been referred to in the body of the column above. These recently provided figures will allow readers to revise upwards the severance figures provided above....and they will also clear up the mystery of B. Nicholson's severance package and the questions raised by incorrect information provided me earlier by Regional Officials. The over-estimation of J. Kolodzie's allowance was due to overlooking the fact that he was an Oshawa Local City Councillor only for many years and not a Regional Councillor

Mr. Longworth, In regards to your inquiry about the severance pay entitlement of the 16 Regional Councillors who did not return for the 2010 to 2014 term, please see the information listed below. (You will see that only 15 have applied at this time.)

Individuals are entitled to this severance if they have more than three years of service, up to a maximum of 18 months remuneration.

Please let me know if you have any further questions.

Abernethy, Jim: $15,992.67
Crawford, Scott: $51,976.17
Cullen, April: $31,487.17
Emm, Gerald: $71,967.00
Grant, John: $15,992.67
Gray, John: $71,970.67
Johnson, Richard: $71,967.00
Kolodzie, Joseph: $27,987.17
Littley, Bonnie: $15,992.67
Lutczyk, Robert: $39,981.67
McMillen, Jim: $27,987.17
Nicholson, Brian: $27,987.17
Pearce, Marilyn: $44,981.67
Shepherd, Bob: $15,992.67
Trim, Charles: $44,981.67

Tania Laverty
Manager, Communications The Regional Municipality of Durham
P: 905-668-7711 ext. 3813
E: tania.laverty@durham.ca

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