City’s huge expenses account revealed
Corporation of Hamilton bosses have set aside $850,000 to pay for their expenses for this year, according to financial records.
And the municipality has been forced to consider slashing essential services in order to reduce operating costs to fund the account.
Documents obtained by The Royal Gazette show that, in the first eight months of this year, the City's elected representatives had swallowed up $479,508 of the allotted $850,000 for 2013. By comparison, in the first eight months of 2012, only $9,764 was spent on members' expenses.
It is understood that a large part of the fund is being used to cover unforeseen “out of budget” costs, including overseas trips and legal fees for a number of court cases that the Corporation is currently battling.
One Corporation insider, who asked not to be named, said the fund was used to pay for “boondoggles” and “exorbitant” legal expenses incurred by Mayor Graeme Outerbridge and his Team Hamilton group. Last month four of the Corporation's nine elected officials, accompanied by an interpreter, went on a ten-day trip to Colombia to attend an international mayors' conference.
Insiders also claim that Mayor Outerbridge has launched a legal challenge to the rights of senior officials to be members of a union, which has ratcheted up the municipality's already spiralling legal bill. The Corporation is understood to have already paid out heavily for legal advice when drafting a controversial 262-year waterfront development lease. And last week Mr Outerbridge and his deputy were in court challenging a charge of contempt after they failed to respond to a Supreme Court summons issued by Ombudsman Arlene Brock. Ms Brock is investigating the Corporation's operations amid concerns about a lack of transparency over the waterfront project.
The decision to set up the emergency fund was first considered at the start of the year. Minutes from a January 2013 Finance Committee meeting, which was attended by Mayor Outerbridge and Deputy Mayor Donal Smith, state: “The Secretary said they were asked to put a line item to cover members' expenses that were non-operational. The Treasurer said it was $50K now down to $30K.
“Alderman [Carlton] Simmons said the Council is looking to set aside a potential remuneration of $850K for expenses.”
The minutes also confirm that “management was asked to find an additional $1M of reductions in expenses of the operational budget”, and then lists a number of potential money-saving measures.
Included among the proposals is a plan to scrap the City Hall shuttle before it resumes service next month, reducing security at Bull's Head car park, and ditching plans to resurface Court and Dundonald Streets.
“The Treasurer then talked about the reductions that management proposed to get to the $1M,” the minutes noted.
“They went through all of the general ledger accounts and came up with a list of areas. A couple of events [New Year's Eve and Music Festival] are gone, the asphalt programme would suffer by $200K; the City Hall stairs in the back that are infested with termites has to be postponed.”
Under the heading ‘Creation of New Revenue Streams', the minutes noted that a task force on parking was being assembled “to ascertain if the Corporation is handling parking in the City in a way to get the best return”.
The Corporation recently unveiled plans to increase parking tariffs and clamp cars throughout the city starting this month “to benefit all motorists who use the streets of Hamilton”.
Although bike clamping was not on the list of new measures, the minutes state that the Corporation is planning to introduce the policy next year — and also claim that the initiative was supported by the former Progressive Labour Party Government.
The minutes state: “May not be able to implement it on day 1 but may be 6 or 9 months after that. The previous Minister, P[ermanent] S[ecretary] and Director have supported this initiative because there will be an uplift to them with no increase in expense.”
Mr Outerbridge and his Team Hamilton group have come under repeated criticism after being elected to run the capital in May 2012.
Last week former Mayor Charles Gosling suggested that Government “needed to curtail the operations of the current Corporation with some immediate action”, adding that it had “thrown away its credence” through a number of controversial decisions.
Speaking after MPs approved the Municipalities Amendment Bill — which gives the Minister of Home Affairs new powers over the municipalities and introduces a Code of Ethics and Conduct for elected officials — Mr Gosling said: “The people of Bermuda have lost faith and feel that the fate of the Corporation is one well-deserved.”
The Royal Gazette was unable to contact Mayor Outerbridge, Deputy Mayor Smith or a Corporation spokesman for comment before press time last night.