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Special In-camera meeting held to discuss Bruce Telecom
by Sandy Lindsay

January 22, 2015

Kincardine Council

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Kincardine Council called a special meeting on Thursday (Jan.22/15) to again talk about the 'sale' of Bruce Telecom and, according to Mayor Anne Eadie, to bring newly elected Councilors 'up to speed' on the subject.

At the outset, the meeting was to move immediately to a closed (in-camera) session however, Councilor Laura Haight raised the possibility that 'generic' questions could be answered before the closed session given that Bruce Telecom board members were at the meeting.

This opened the door to many questions.

Councilor Laura Haight said that she had explained to one of her constituents that it could be problematic to answer questions, then go to a closed session and then back to an open session.  "Perhaps, we could keep track of 'open-type' questions and then answer them later ... I am open however.

Mayor Anne Eadie said that there had been a meeting in the past where Council had taken considerable time to try to figure out what was open and what was closed and wasted a lot of time.  "I agree however.  If you want to ask your generic questions first before going into closed session."

Councilor Maureen Couture agreed that it would be good to answer generic questions and, if a question was considered closed, then it should simply be declined.

Haight opened the questioning about a commission. 

The CAO, Murray Clarke, answered that the commission was payable upon the sale of Bruce Telecom.  "I know there have been questions about a 'finder's fee' but there is no finder's fee.

"Therefore," said Haight, "I imagine until a sale is completed, much like the commission on a house, if the sale doesn't close then there is no commission."

"There is no agreement with the sales team," said the CAO.  "There can be no commission at this point because there can be no sale.  The agreement with the consultant has expired and is finished."

"This is the third time I have heard this," said Haight, "so I have to believe it's true."

Councilor Gord Campbell wanted to ask a question of the Board (Bruce Telecom) but the Mayor quickly intervened.  "The Board is here tonight to observe and it will be preparing a report to bring to Council at another meeting."

Haight suggested that Campbell be allowed to ask his question but that the Board did not have to reply, at which the Mayor pointed out that she had agreed with the Board that it would be an observer only.

Councilor Maureen Couture then said that she needed the answer to a question ... a yes or no answer.

 "I've heard the deal is dead.  I've heard we should be talking to Eastlink.  I've heard and I know that we have asked that the Board go back and prepare a report with Bruce Telecom.  So, the Yes or No answer is ... is there any reason to think there will be any deal with Eastlink or not.  Modified or otherwise.  Is that something that can be answered or do go in-camera? Which path are we going down?  We are at this stagnated position where the deal is dead, the commission is dead but maybe we should go talk to them about certain things."

"I can give you an answer to that," said the CAO.  "once we know what Council wants us to do.  If Council would like to pursue an opportunity with Eastlink then maybe we could go back to them."

"So," said Couture, "there was no instruction from the previous council to go back to Eastlink and negotiate?"

"No," said the CAO.

"That helps us," replied Couture, "because I didn't really know if there were discussions going on or if there had been meetings.  I did not know if Eastlink did not want to talk to us.  In fact, I heard they have been very polite but there is the question of cost which concerned me greatly.  So, until we, the Council, say 'let's go talk to Eastlink' ... we are not talking to Eastlink?"

"That's correct," said the CAO.

Deputy Mayor, Jacqueline Faubert, also wanted to know what the path forward is and what the timeline is. "I have so much anxiety about this," she said, "that I just want to know what the path forward is."

"Well, from my viewpoint," said Mayor Eadie, "I wanted this all settled in December (2014) for the employees, the Board and everybody else but Council indicated it wanted more education and needed to get up to speed.  However, I think it is paramount that we make a decision as soon as possible.  That's my feeling and I have expressed that many times.  We need to get moving.  The company has to get moving ... they've been carrying on and have been doing very well and I commend all the staff and Board.

Councilor Randy Roppel said that he wanted to see a five-year business plan brought by the board.  "I think we owe it to the staff and Bruce Telecom employees, to this Council, to the people who own the business.   Something has to give.  There is a total lack of trust with respect to all the people in this municipality."

"Also, I would like to see all the documents with respect to the sale," he added. "I think we have a right to see them and we should know what went on because we weren't there and there had to be more documents than a By-Law."

The CAO quickly pointed out that all the documents were available to the Council, including the Agreement of Purchase of Sale.

Haight said that she heard Councilors in the past were 'prohibited' from seeing the documents but as pleased they could in fact read them.

The CAO said that staff had not, in fact, been asked by anyone to see the documents.  "They are however, confidential documents with respect to our own business and Eastlink that must not be made public and that must be clear to Council.  But all material is available to Council." Campbell pointed out that the people in the country are not getting high-speed.  He also asked,  "Why are we (municipality) trying to sell a company that brings in income of $1 to $1.5M every year?"

Couture said she recalled several times of meeting with Bruce Telecom and the budget was presented about how much they would need for Capital and for dividends and every single time, one or more members of Council asked staff or Bruce Telecom 'do you have enough because we won't take that whole dividend if you (B.T.) need it'.  Every single time Bruce Telecom said yes they had enough and in fact increased the dividends. 

"There is only one reason for Bruce Telecom and that is to defray the cost of taxes.  If a company doesn't make money, why would you have it?  The taxpayer is not in the business of telecommunications.  If that sale had gone through," she said adamantly, "and I will say this until the day I die, that money would have gone into a trust to pay dividends for the benefit of all the taxpayers, including those in Ward 3."

"There were rumours," she added, "that it would be used for natural gas.  Over my dead body ... and I think that's true for most members.  I'm trying to say ... we've always asked Bruce Telecom do you have enough for Capital and dividends?  The answer has always been 'Yes'."

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"I think that Council in the past did due diligence in asking that question," said Mayor Eadie. "

Councilor Mike Legget then stepped in to correct Campbell.  "You said, Gord, that the company (Bruce Telecom) lost money. The company never ever lost money.  I've heard that rumour all kinds of times but it never lost money and we (Council) never drove it into losing money."

Councilor Linda MacKee was the final Councilor to ask questions, ostensibly from her constituents.  "Why would any Councilor or sane person agree to sell a valuable asset without seeing the sales agreement?"  How much in additional professional fees did Mayor Kramer rack up by insisting the rules of the secret sales agreement be followed after Eastlink terminated the sale?  I think they are asking that they heard Mayor Kramer went to the East coast to talk to Eastlink."

Couture immediately said, "We (Kincardine) didn't terminate the sale.  Eastlink terminated it and we (Council) did not agree with the termination.  I think there was an attempt made to find out why and, perhaps, that's what is being referred to (Kramer to the East coast)."

"I hate the pejorative of 'secret sales' and 'Mayor Kramer racked up'," said Haight.  "Mr. Kramer and I had our issues but, as Mayor and the head of Council, he would have had the direction of Council and the Sales Agreement."

"Some of the information is also totally confidential," said Eadie.

"On the asset purchase agreement and that 'Council is insane'," said Faubert, "the experts in telecommunications that were hired had done numerous transactions far in excess of this one and were vetted to the highest capacity. You have to have faith in those telecommunications experts who know what they are doing.  I found the experts were open to any and all questions that we had and answered in minute detail any questions over 20 hours of consultatiojn.  I do not think reading over this agreement that anyone could think anyone could be labelled insanity."

Council then moved into closed session.

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Thursday, January 22, 2015