File photo.

File photo.

Concern over former Thompson-Nicola Regional District CAO’s spending leads to financial review

The review expected to take about three months to complete and cost between $50,000 and $75,000

  • Mar. 15, 2021 1:19 p.m.

-Kamloops This Week

The Thompson-Nicola Regional District board has approved an independent third-party financial review in expenditures over the past half-decade.

Staff will issue a request for proposals, with the review expected to take about three months to complete and cost between $50,000 and $75,000. The TNRD’s audit committee met this week and made recommendations, suggesting a review be conducted by an independent third party and encompass the expenses of all senior management and board directors from 2015 to 2020. If irregularities are found, it could go back farther in time, the board heard. The review will include examination of reporting, approval systems in place at the time and potential improvements to policies and processes.

Furthermore, the review is expected to be more thorough than a typical annual audit and “forensic” in nature.

The review comes in the wake of a KTW investigation into spending at the TNRD from 2015 to January 2020 via the regional district-issued credit card of then-CAO Sukh Gill. Receipts from that time period show numerous charges for parties and to coffee shops, high-end restaurants, wineries, luxury hotels and liquor stores.

Gill left the regional district suddenly in February 2020 with a $500,000-plus payout and a legal agreement mandating his exit be called a “retirement.”

TNRD CAO Scott Hildebrand, who joined the TNRD last September, said during Thursday’s (March 11) board meeting that questions have been raised about whether some past transactions by the TNRD should have been incurred on the taxpayers’ dime and whether they were appropriate. He said his expectation as CAO is to continue to do business in a “cost-effective” and “fully transparent” way, with oversights and safeguards. He said the review process would be led by himself and legislative services director Deanna Campbell with “full impartiality.”

“This will become our priority, with the goal to move this along as quickly as possible, while ensuring things are done right,” Hildebrand said.

The final terms of reference will be brought back to the board and the end result will be a report coming back to the board and public.

Kamloops Coun. Arjun Singh wondered if the money could be better spent on work not already done and reiterated he feels “quite strongly” that a lot of the expenses reported are legitimate.

“There’s obviously spending that nobody can really defend, but I mean the $500,000 top line number there is actually not the number that is salient, in my view, in terms of public concerns,” Singh said.

Hildebrand said given the awareness and media exposure in recent weeks, it needs to go a third party for that judgment.

“I just feel that would be an appropriate next step to be as fully transparent as possible,” he said.

Singh asked if the third party report would be released without “massaging” from the regional district. Hildebrand replied: “That is my understanding, but of course that would be the direction of the board.”

Sun Peaks Mayor Al Raine expressed support for a review. He said that while board members may feel comfortable with policy changes, an independent review could bring forward items the board may not be aware of and things that could have been done better.

“It think we owe that to the public to make sure they understand clearly that this is an open review and if they discover things that we’re not aware of, there are other changes that we will have to make,” he said. “I don’t think we should be comfortable by saying we knew that some changes had to be made, we made some changes and kind of everything’s all right. We’re doing this because we want to make sure that absolutely everything’s all right.”

Singh also said he did not wish to see a forensic audit occur annually. Chair Ken Gillis said he believes the forensic audit will show processes put in place since the expenses came to light and negate need for such an audit in the future. Coun. Mike O’Reilly said he hopes a third party review will give confidence to the public that the board is taking it “extremely seriously.”

“I think it’s very important to rebuild confidence and trust in the TNRD and how we move forward and I think it’s imperative that we do this now and, hopefully, we take these recommendations that we get from it to heart and we can chart a path forward,” he said.

Only one board director, Cache Creek Mayor Santo Talarico, opposed the review. He told KTW he is in favour of a financial review or audit in principle, but thinks the optics of the board setting out terms of the review will render the results unacceptable to the public. He said the goal should be instilling confidence in the regional district, arguing an independent outside group should put the review criteria together.

Directors push for increased transparency on spending

TNRD Area P (Rivers and the Peaks) director Mel Rothenburger suggested quarterly reporting on credit card expenses and other expenses submitted by directors and staff for reimbursement so it would be available freely to the media and public online at any time.

“As opposed to the current annual reports, which only give totals, and the amount of information is fairly basic in those,” he said. “I’m saying I think we would be better to provide a much more detailed report and not just on an annual basis, but quarterly or perhaps even monthly. That’s looking forward as opposed to looking back, which is the current conversation.”

Raine noted expenditures for federal MPs are listed on a government website. He said it is a requirement for the expenses to be made public, with precedent at the federal government level.

TNRD finance director Doug Rae said more reporting and detail should be provided to the board on expenses. He said in the past he has reported on all expenses and revenues for the entire organization and the feedback received was that it was “too much.” He suggested focusing in on areas on which the board wants to keep a closer eye. He said he is in support of that initiative, but cautioned it might result in additional finance staff.

“I’d like to provide more work, more reporting,” Rae said. “It may require some more resources in order to keep up with the workload.”

Rae agreed to bring back a plan on that matter.

READ MORE: Taxpayer-funded, two-drink maximum gets nod from Thompson-Nicola Regional Board

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