Wednesday, January 11, 2017

Emergency Services Commission passes interim budget

Raw video from Jan. 11, 2017 PCESC meeting

Chris Davis with notes from Toni Lucas - The Pincher Creek Emergency Services Commission (PCESC) met on January 11 at the Town council chamber for what turned out to be a two hour meeting about their 2017 operations budget**. In attendance were Town of Pincher Creek Mayor Don Anderberg (Chair), MD of Pincher Creek No. 9 (MD) Reeve Brian Hammond, Town councillor Doug Thornton, MD Deputy Reeve Terry Yagos, MD Finance Janene Felker, Town CAO Laurie Wilgosh, Pincher Creek Emergency Services (PCES) Chief Dave Cox, and PCES Administrator Lori Schill*. After much discussion and a number of disagreements the commission passed an interim budget.

The tone of the meeting was much removed from the show of solidarity by the Town and MD in late August of 2015 when they jointly announced they had reached an agreement "to jointly provide fire and ambulance services through the Pincher Creek Emergency Services Commission" and that disaster management services "will be jointly provided by the newly formed Pincher Creek Emergency Management Organization" (a separate entity). PCESC was officially green-lit by the Government of Alberta in March of 2015, and became an official body on July 1, 2016. The two councils of 2013 approved the formation of PCESC.

Two days before the PCESC meeting, at the January 9, 2017 meeting of council for the Town of Pincher Creek, councillor Thornton said he attended a recent Emergency Services Commission meeting. "I am sorry to report that the budget was presented for 2017 at that meeting, and unfortunately, it did not pass. So at the present time, the EMS Commission is operating without a budget."

Early into the January 11 PCESC meeting Thornton moved that the 2017 budget be passed, which was immediately countered by councillor Yagos, who said he was concerned about a lack of sufficient financial reporting. He asked if a new year was opened in Quickbooks starting July 1, 2016. Chief Cox said "Yes, because this is a new company." Yagos then asked for an audited statement and the financial information from the accounting program, at one point saying he wanted to compare the 2016 budget to the 2017 proposed budget. Cox said "The comparison is unrealistic, because we approved an annual budget for 2016, then... we started the business up, shut down Emergency Services running under the (previous) agreement, and went to the commission as of the first of July (2016). It wasn't six months. We actually had to wait until we had all of the costs for the money we had actually spent and then moved the portion of the budget that wasn't spent into the commission's budget. So in some cases, there was zero spent in a particular budget line, in other cases there was 40% spent, so each line adjusted. So we had to wait until we got all our audit information back on the mid term audit. So that just drug everything out."

"We've got the numbers, you should have the numbers," said Yagos. Cox replied "What I put down right now for the commission's budget is not a reflection of what we spent in 2016."

Yagos said "All we need is to know is how much money we have spent since June 30, and did we adopt the 2016 as the budget for the commission?"

Anderberg asked if there were any unusual expenditures that were not accounted for in the budget, or large vacillations either over or under for the lines from the budget. Cox responded that in the Maintenance category there was a replaced boiler that was unusual. "We are very close to being right on budget, when we kind of look at our informal numbers." 

Yagos proposed an interim budget until a printout from Quickbooks was generated for review. Cox said "If you look at the way we do a budget, and I put 6 months budget in, it's not going to show what we ask for in relationship to a 12 month period." Yagos said that the organization is currently $96,000 over the Alberta Health budget, to which Cox replied "Our profit-loss that we've done traditionally, that we're changing with the commission setting up, always showed the Fire, showed the Ambulance, showed the profit loss. Whether we are making money or losing money, that's the number I use. Traditionally, we have run within.... ran a surplus ever since we took over this contract. We don't use that money for anything else, except to put into a capital reserve."

"Our process of identifying it separately in a capital reserve is there. It's just not part of this budget," said Cox. "There is nothing hidden here." Yagos replied "If we are making money on the contract, according to the contract, we are not allowed to make money on it." Thornton said "Before us is a plan for 2017. I believe that our efforts today should be addressed to the expenditure of these funds, for the upcoming year."

Anderberg suggested that all expenditures, including payroll, could be recorded in the cheque register, adding that the books were closed off and audited to start the commission. "We have had two audits in six months." He said there were no red flags from either audit that has occurred to date. Cox said many of the expenditures are once annually and are either within or not within the time-frame of six months that the commission has been running. "This is an anomaly, I don't know how to address it, I honestly don't." He added "We do have a surplus," explaining there was a surplus in 2014 and 2015, according to the auditors.

Hammond asked "How long it might be before we might get the kind of detailed information that we've been asking for, even though you say it is somewhat irrelevant, because I think it bears on this decision here?"

Anderberg said "What you are asking for actually pertains to the 2016 budget, so if you get that information, you can compare that to the 2016 budget, but what Dave (Cox) just said was, is that when he was building the 2017 budget... he is not working on the real numbers for 2016, because he hasn't expended the 2016 budget yet. The 2017 budget is a separate item."

At one point Anderberg said "Recently, we had a real incident out on Highway 3 that brought to light to me how very, very important the service and the service model that we have now is to us." At another point he said "I am going to be quite blunt. We have no budget, it's 2017, 11:30 (am) January the eleventh of 2017. We are running an organization here. That is probably the most critical organization that anybody has anything to do with. I would say we are talking about reports, we are talking about looking at line items. You know what? It's all going to be available. I am understanding that yep, it's not available today. I guess if you are willing to vote against this motion, because they haven't done some paperwork, that's fine. I am not going to vote against this motion, because I don't have paperwork, because I have confidence in the organization, and the people who are in this organization, and the auditor, and the history."

"Somebody's got to take responsibility for making sure people get paid." 

Yagos said "The reason we don't have a budget is... I wasn't the one that voted against an interim budget. An interim budget would give us a chance to get this paper to look at. And we had an interim budget last year, when I came back on the commission." Anderberg said the MD commission members voted against the budget, and the Town members voted against an interim budget.

Hammond said they recognize the importance of having a budget in place. "I don't think it's really fair to suggest we don't have an empathy for what Emergency Services do in our community." He brought up the responsibility of governance and oversight, and to answer questions. "Quite frankly, we didn't feel like we got the kind of answers that we wanted, and that's why we proposed an interim budget in defeating the first round. We don't have that information yet, and I really don't see why we can't operate on an interim budget based on 2016, until such time as we have that assurance, or we have an auditors report, or both."

Anderberg said there is not money in the budget for the required Accreditation Program. Anderberg said that moving forward without those funds in the budget would have consequences. "It is a contractual obligation, and there is a deadline on that."

Thornton later reiterated "The motion is to pass the budget, as it is. That can be amended at some point in the future." Cox said any interim budget based on 2016 should also reference 2017 operations budget.

Anderberg asked "Are you really, really stuck on this?... Are you really stuck in your position so hard, over some paperwork that you'll allow, could allow, this organization to go sideways?" Hammond replied "If you defeat a motion for an interim budget, then you'd have to ask yourselves that." Thornton said "There is a motion to pass the budget, as circulated. So support the motion."

Anderberg said "This is just a big game of chicken going on here. I understand your point of view. I am looking at the point of view of the people who work at this organization. By us sitting here for an hour and a half talking about the little bit of paperwork that isn't done, and them having to go out there every day and do their job... and they don't know where this organization is at? I mean, come on."

Thornton called for a recorded vote on the budget as presented. The motion failed, with Anderberg and Thornton in favor, Hammond and Yagos opposed.

Hammond moved that a budget be approved based on the 2016 year, until such time as the MD receives the requested information and audited statements. Cox asked if the interim budget will address the capital budget, which is a 5 year budget. "Because it is all part of the same budget, I need that addressed. Because when you leave it out, I don't have a clear direction on how I am going to go forward." Thornton suggested an amendment to Hammond's motion, that the interim budget could be based on the 2016 budget, with the addition of the cost for accreditation for a year in the amount of $35,436. Yagos said he would not approve a motion with the cost of accreditation included "As there is already money there, in the interim budget."

Everyone agreed they had to have a budget.

Anderberg said "The real bottom line here is that we have a $14,000 increase in the total overall budget. You have got $34 or $35 thousand dollars in accreditation. So, administration has virtually gone and found $20,000 of that internally in the budget, and what's the issue?" He suggested an amendment to the amendment, an interim budget with a reduced amount to cover a three month portion of accreditation costs. Cox said that would not allow him to properly budget for the continually ongoing accreditation process. A motion was made regarding Thornton's proposed amendment, which passed with councillor Yagos dissenting. Then a vote was call on the complete motion, Hammond's original motion and Thornton's amendment, to approve an interim budget using the 2016 year's numbers, with the addition $35,436 for accreditation. That motion passed unanimously.

*corrected for accuracy
**Addition for clarity: The capital portion of the budget was approved at a previous meeting. 

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