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Tuesday, January 20, 2009

Anti-Epcor Protest Misleads and Fizzles...As It Should

UPDATE: EDMONTON CITY COUNCIL VOTED 7-6 IN FAVOUR OF THE ASSET SALE TO EPCOR YESTERDAY JANUARY 21/09

I am fascinated over the various events and pieces of commentary on the proposed EPCOR purchase of the City of Edmonton Gold Bar Water Treatment Plant. The media coverage has been extensive including Letters to the Editor, an editorial, columnist coverage and an Op-Ed http://www.edmontonjournal.com/news/Gold+proposal+much+more+than+just+harmless+transfer/1190969/story.html More about that in a minute.

Today the Edmonton City Council will have an all day non-statutory public hearing on the proposed transaction. My guess is more people will prudently opt to watch the Obama inauguration.

This issue has clearly not resulted in a spontaneous ground swell of citizen concern over the EPCOR proposal to buy the plant from the city. The protest rally to oppose the sale drew “about a dozen people” to the steps of City Hall on Sunday. Can you conclude anything other than the support for opposition to the deal is underwhelming?

Full disclosure, EPCOR is a client but we are not working on this file and I have not spoken to them about it. What I really want to discuss here is the astonishing misunderstanding or misrepresentation of the relationship between EPCOR and the City of Edmonton, especially as it relates to this proposed transaction and generally. The best place to illustrate this is the Parkland Institute’s Executive Director, Ricardo Acuna’s Op-ed in the Sunday Edmonton Journal.

The Gold Bar proposed sale deal is for $75 million and Mr Acuna says Edmontonians are being told the sale is “trifling detail.” I don’t recall anyone putting that characterization on a deal that large and I wish Mr. Acuna would provide the source of that representation. It would help us better understand the comment and add credibility to his framing and positioning of the transaction.

The proposed sale is said to superficially “…seem innocuous enough –a simple transfer from the city to its wholly owned corporations EPCOR.” However there is a suggestion my Mr. Acuna that on closer examination the deal “…raises some disturbing questions.”

So what are the “disturbing questions”? Well apparently one is the very purpose of the water treatment plant which is to process sewage to make it safe to return to the river. The city operation of the facility is truthfully said to do that job with “…admirable efficiency and effectiveness.” Mr. Acuna poses a question about how the Gold Bar asset transfer will benefit Edmontonians and says “the question is still largely unanswered.” Whatever that means!

I don’t know exactly what representations EPCOR has made in support of the transfer but I doubt it was to enhance their “expertise and reputation” around water treatment. They already run the E.L. Smith and Rossdale Water Treatment plant for Edmontonians. They provide water treatment services to 8 other Alberta communities and others in B.C. and Ontario. EPCOR’s expertise and reputation is clearly not the issue.

Mr Acuna’s next concern seems to be about the ownership and control of EPCOR. EPCOR is a corporation that is wholly owned by the City of Edmonton. Mr. Acuna is right about one thing, these are two legal entities but they are not “entirely separate” as Mr. Acuna states. The City of Edmonton owns EPCOR and appoints the Board of Directors to oversee the strategic and management operation of the corporation for the benefit of the citizens of Edmonton. The city wisely does not interfere with the day-to-day operation, just like the Province of Alberta deals with the Alberta Treasury Branches.

This asset sale transaction is not a privatization as per Mr. Acuna’s mischaracterization. It is merely a legal reallocation of asset management responsibility within the governing and control ambit and ultimate continuing ownership of the City of Edmonton.
The coalition campaigners to discredit a normal business transaction as something sinister include the Council of Canadians, CUPE and the Parkland Institute. They managed to draw an astonishing “dozen people” to rally in front of City Hall last Sunday to protest the deal.

Edmontonians obviously don’t feel like Mr. Acuna alleges that they are being given a “dismissive pat on the head and patronizing assertions that there is nothing to worry about.” What is happening is this “Keep Drainage Edmonton” coalition has been exposed and proved to be like the Wizard of Oz with the curtain pulled back.

People are entitled to their own opinions but not their own facts.