MACA report: Iqaluit still in trouble

ANNETTE BOURGEOIS
Nunatsiaq News

IQALUIT — Iqaluit Town Council has recently found itself in a position similar to a 1993 council that was booted out of power by the GNWT because it didn’t pay its debts.

“One of the key factors that led to the appointment of a municipal administrator in 1993 was the severe financial problems faced by the Town, including its inability to meet the repayment terms of the debentures payable to the GNWT,” states a recent report done by inspectors from the Department of Municipal and Community Affairs.

Last fall, newly elected Councillors Matthew Spence and Lynda Gunn asked MACA to investigate and evaluate the Town’s administration.

“Because we were so new, we wanted to take a look at the administration and get a third-party, unbiased view of how the administration is running,” Spence explained.

MACA inspectors began their investigation with outstanding commitments made by the previous council, elected in the wake of the dissolution of the 1993 council and the one-year administration of the Town by government-appointed municipal administrators in 1994.

“The Town is at a pivotal point in its emergence from a municipal administrator,” states the report. “Some good progress has been made since 1994, but some of the concerns that were in existence in 1994 still exist.”

The report covers financial management, human resources management and general administration by the Town’s administration during the 1997 calendar year.

Unpaid debentures until December

At the end of 1996, the Town had about $4.2 million in outstanding long-term debentures owing to the GWNT. These debentures are loans from the territorial government to the municipality.

The Town has one fixed debenture payment; the others are land development debentures tied to revenue collected through land sales and leases. Under the repayment terms, the Town is legally bound to forward its lease revenues to the GNWT.

As of Dec. 19, 1997, when the report was completed — it was tabled at a council meeting last week — the Town had made no debenture payments for revenue collected during 1997.

MACA inspector Don MacDonald, one of the authors of the report, briefed Spence and Gunn on the financial position of the Town prior to Christmas.

“At that point we were very concerned about the situation because, technically, we were in default and in exactly the same position as that previous council,” Coun Spence said.

“Certainly that was a concern to me as a councillor and it was a concern to some of the other councillors, but I think at this point, the problem’s been solved, at least for now. The payments have been made.”

Debenture payments now made

By the end of December, the Town had made a debenture payment to the GNWT of more than $600,000. Another payment of about $33,000 was made in February.

Spence blames part of the Town’s failure to keep up on payments on the change in senior staff. Both the senior administative officer and the director of finance have held their positions less than two years.

“It was largely due to a lack of good record keeping and the fact that a number of positions had turned over during that period,” Spence said. “For some of the loan agreements, there wasn’t even copies at the Town office.”

But the staffing situation hasn’t improved. And, in the short term, it’ll get worse.

SAO and social services director leaving

Sara Brown, the town’s senior administrative officer, announced she’s leaving at the end of March, along with Roger Sevigny, the acting director of social services.

“It is going to leave the Town in a bad spot,” Spence said.

To deal with the absence of an SAO, two councillors and the mayor will sit on an executive committee. Someone will also be appointed to the job on an interim basis.

“In the transitional period, we’re going to be more actively involved in the day-to-day administration of the Town,” Spence said.

Inspectors outlined a number of recommendations to deal with administration deficiencies and state in the report that MACA will monitor the Town “very closely to ensure that real progress is made.”