Waterfront Trust grilling on deficits, back taxes, transparency 'an insult,' says its chair

The Hamilton Waterfront Trust has sidestepped calls for a forensic audit and more transparency — and says comments scrutinizing the agency are "an insult" to its past and present volunteers.

I'm appalled people can make such statements without the simplest of research.- Bob Charters, Hamilton Waterfront Trust chair

Bob Charters, HWT chair, told city councillors Wednesday that recent questions about the agency were an affront to its board members, who volunteer hours of their time each year.

For years, the public and the media have questioned the HWT about its sustainability and operations. The agency posts consistent annual deficits, doesn't post its financial statements, couldn't provide meeting minutes this summer and owes the city nearly $400,000 in back taxes.

Charters said criticism this year has been outrageous.

"I take exception to the comments so carelessly made, and I'm appalled people can make such statements without the simplest of research," said Charters.

"This is an insult to all present and previous board volunteers."

Charters made the comments as the HWT presented its financial statements going back to 2015 to city council's general issues committee. The HWT is an arm's-length agency that oversees developments on the waterfront, including the trolley, tour boats, rink and property leases on Pier 8 and Bayfront Park. City councillors comprise half of its four-member board.

The presentation came after months of public scrutiny, particularly from Coun. Donna Skelly of Ward 7, whose comments Charters referred to as "crafty."

It is onerous for organizations to have to be able to keep their minutes in order for them to be released.- Bob Charters

Skelly and local media have questioned why Canada Revenue Agency annulled HWT's charity status last year (answer: it never should have had it in the first place, so the feds corrected that), why its audited financial statements weren't readily available, its persistent deficits and why it owes $396,000 in back taxes on two properties.

Skelly and other detractors also questioned why it took the HWT weeks to release past meeting minutes.

Gathering the minutes takes a lot of the small organization's staff time, Charters said, and not-for-profit organizations aren't required to release them.

"It is onerous for organizations to have to be able to keep their minutes in order for them to be released," he said.

Skelly said she wanted the HWT to submit to a "value for money" audit from the city's director of auditing services, but no other councillor would second her motion. Transparency is particularly important given that the city is about to redevelop Piers 7 and 8, she said.

"It will forever change the complexion of our waterfront," she said, "and will forever change this city."

Charters, a former alderman who ran against Skelly in the 2016 Ward 7 byelection, took particular exception to Skelly's comments in the media in recent weeks. But persistent criticism has dogged the HWT for years.

'We should be applauding'

In 2012, for example, local resident Gary Santucci appeared on behalf of a group of concerned citizens to ask about the HWT's years of deficit budgets. City councillors told Santucci they have "complete confidence" in the board.

"So much of it has been regurgitated and is news from five, six, seven years ago," said Coun. Tom Jackson then. "I think we need to celebrate so many of the wonderful projects that are going on at the west harbour and the beach trail."

Councillors closed ranks on Wednesday too, with one saying the continued scrutiny is embarrassing.

It certainly dragged out and I didn't help with the messaging.- Jason Farr, Ward 2 councillor

"We should be applauding the Waterfront Trust, not scrutinizing them to almost the level of embarrassment," said Sam Merulla, Ward 4 councillor.

Jason Farr, a Ward 2 councillor and HWT board member, said the trust learned some lessons, as did he.

'It certainly dragged out' 

The board has already agreed to release its meeting minutes, Farr said, adding he was always in favour of that. Other members worried the minutes would contain confidential information.

Farr said he and others could have cleared up questions sooner. "It certainly dragged out and I didn't help with the messaging."

Ed Brink of BDO Canada presented the audited financial statements. In 2016, the HWT had a $230,336 deficit. The year before, it was $453,563. 

This year, the HWT restructured to form two organizations. The original HWT continues as a not-for-profit, while HWT Inc. operates and manages specific components, such as William's Fresh Café.

The trust was formed in 2000 with about $6 million in seed money from a court settlement with the former Hamilton Harbour Commissioners. The trust itself said in 2015 that the agency is likely not sustainable.

The trust will meet with the city in December to discuss its future direction.

Councillors also voted at Wednesday's meeting to look into making every organization that gets substantial city funding post its agendas, minutes and financial statements online.