This morning, I was a guest on the Jordi Morgan show on News 95.7. During the show, Morgan’s producer was able to reach Trade Centre Limited president Scott Ferguson on the phone, and I was able to ask Ferguson a few questions.
Among other things (which I’ll get into in another post), Ferguson said that except for the last $400,000 forwarded to Power Promotions, all the $5.6 million in loans was secured by ticket sales—that is, Power Promotions had been advanced money that had already been collected from ticket sales by Ticket Atlantic, TCL’s ticket agency.
There seems to be an attitude that the $5.6 million is no big deal—the city got it back, after all. But, really, this gets at the heart of the scandal, for two reasons:
1. Ticketing agencies shouldn’t front money from ticket sales because the concert might be cancelled, and if so, the agency would have to refund ticket purchases to buyers. This, in fact, is exactly what happened with the Kid Rock show, which was supposed to be held as part of the “Halifax Rocks 2010” series on the Common July 23, 201, but was cancelled; Ticket Atlantic offered to let people who had bought Kid Rock tickets use them for the July 24 Black Eyed Peas show, but if purchasers chose not to take the offer, they could get refunds at the box office.
This, in short, is where the risk factor came in. By advancing loans from ticket sales, TCL was opening the city to tremendous financial risk, and this is precisely what city finance director Cathie O’Toole wrote in her scathing report on the loan program: “The establishment of this business practice…exposed the municipality to financial risk.” Note that O’Toole didn’t say it was just the last $400,000 in loans that was risky; rather, it was the entire program that was risky.
2. Beyond that, Ferguson’s explanation can’t be true. There were two shows as part of Halifax Rocks 2010—Black Eyed Peas tickets went on sale April 16, 2010, and the Kid Rock show wasn’t even announced until June 1, 2010, so obviously ticket sales started after that date.
But included in the paperwork made available by O’Toole (Attachment 3), Power Promotions was advanced $500,000 for the Halifax Rocks show on March 29, 2010. This is not part of the last $400,000 that Ferguson admits was unsecured—this is an early payment that was repaid.
The paper trail shows definitively that TCL advanced Power Promotions a half million dollars for the Halifax Rocks shows even though not a single penny in ticket sales had been collected.
For The Coast’s complete coverage of the Common concert financing scandal, click here.
This article appears in Mar 17-23, 2011.
And $400,000 was advanced on January 29 2010 for Country Rocks.
Simple solution to the Kelly Caper – No transfer of funds without notification to Mayor, City Solicitor, Finance Director and Chair of Finance & Audit Committee.
TCL manages Metro centre for HRM.
What financial information do they supply to HRM Finance department and how often ?
How many people remember when Kelly bought the $90,000 mat to protect the grass on the Common ?
He just went out and ordered it without council approval, and then said it was necessary and it just couldn’t wait for council approval.
Tim, you got your Sherlock Holmes hat on with pipe in hand, keep digging.
good job.
TIM I love your work on rattling the chains. Obviously noone inside the praly gates of the HRM inner sanctum would ever say much about their brethern. I mean this thing could get bigger. Obviously Dan English must of been involved. Anstey was only acting CAO. And the CFO I mean I am shocked that the CFO didnt know about this money.
She simply wasnt doing her job. Of course she resigned today to take a job at the Water Comission.
I really hope Larry Munroe keeps digging. I wonder how many at City Hall are not sleeping well this weekend.
TCL Board Member Bio
28june2010: SWSDA’s Anderson booted from Industrial Commission and World Trade Centre…the once-powerful South West Nova economic czar Frank Anderson seems to have met his Waterloo in the form of the current NDP government and has become somewhat of a pariah in government circles.
Anderson has been embroiled in a series of lawsuits over recent years, was the subject of a complaint to and investigation by the Ombudsmans Office and a government-provoked audit has been publicly rebuked by Premier Darrell Dexter and privately by senior government staffers.
Recently, the government stripped Anderson of his prestigious board membership in World Trade Centre in Halifax and the Yarmouth Area Industrial Commission (YAIC) announced last week he had been let go as CEO, where, according to the Ombudsman, he oversaw the agency’s predeliction for back-room deals, questionable financial transactions and other dealings. YAIC general manager, port manager and former senior SWSDA staffer Dave Whiting will do double duty as GM/CEO.
AllNovaScotia reported that Anderson made a proposal to the YAIC to keep his job, but was rebuffed by the agency board.
“He’s finished doing business around here,” said one economic development official of the beleagured Anderson. Word in local government circles is that any meeting involving government funding will not take place if Anderson is present. The full extent of repercussions from Anderson’s peculiar style of doing business is yet to be felt, if recent reports are at all accurate.
A construction company is owed $370,000 Anderson allegedly spent on other projects, the local tourism committee committee is complaining to SWSDA of monies gone awry and consultant bills not paid and the current tenants of the Sandy Point sound stage appear to have cleared out for good after racking up $66,000 in unpaid mortgage fees and $150,000+ in unpaid taxes. Apparently, the pair of American land speculators have allowed the once multi-million dollar property to degrade under their watch so that it would bring “less than half a million”, according to a source familiar with the property
There is also speculation that a recent forensic audit of SWSDA’s books from the Anderson years might also result in further investigation by the RCMP, with the potential for criminal charges being laid. Economical Development Minister Percy Paris was reported on Friday to say that the nine municipal units which comprised SWSDA have to bear the full weight and responsibility for the economic consequences of Anderson’s actions.
With SWSDA’s new slogan of “We spend your money like it’s our money, hard to tell how many hundreds of thousands of dollars CEO Frank Anderson will let Kendrick and his muse rack up before Anderson comes to folks in Shelburne County, claiming it is really we that owe him the money?
Maybe it was all Frank Anderson’s Idea LOL Anyway WHO is the unamed Senior HRM official from 2008 that started the loan program?