Rail cars in a Nanaimo yard earlier this year.

Rail cars in a Nanaimo yard earlier this year.

Report suggests ICF’s lack of transparency leading to lack of trust from politicians, public

The report was prepared by aKd Resource for the Association of Vancouver Island Coastal Communities

The Island Corridor Foundation’s lack of transparency regarding the business case for re-starting rail service has resulted in a lack of trust and support from even the most staunch supporters of rail, says a report released this week.

“We see no practical reason for them to operate in such a closed manner,” said the report prepared by aKd Resource for the Association of Vancouver Island Coastal Communities and obtained by The NEWS this week. “It is hurting their credibility and reducing support from politicians and the public.”

The report, which provides 18 recommendation for the ICF, raised questions and made statements about the finances, governance and management of the ICF. aKd Resource said it had input from 40 people for the report, including regional district district directors and CAOs and both the CEO and chair of the ICF.

Former Liberal MLA Graham Bruce was hired to be the ICF’s executive director in June of 2009. Granneke Management is Bruce’s consulting business. Granneke’s contract with the ICF was up in May. It was renewed by the ICF board in late May for a term that doesn’t end until November of 2018.

“A recurring theme in the interviews with regional district board members was the lack of trust in, and credibility of, the Chief Executive Officer and by association the ICF board,” said the report. “Much of this dissatisfaction was generated in the last couple of years when expectations were raised by overly optimistic predictions and public promises of funding expectations, contracts or agreements which then did not materialize… while some of these perceptions may be grounded in reality, they are nonetheless by association damaging to the ICF. This is particularly true for many of those interviewed who saw the recent contract extension of the CEO to be an example of the level and quality of oversight by the board of directors.”

Island politicians were asked for their reaction to the report on Tuesday.

“It’s not a good situation,” said Parksville Mayor Marc Lefebvre, the city’s representative on the Regional District of Nanaimo’s (RDN) board of directors.

The RDN rescinded last year on its commitment to provide the ICF with almost $1 million in funding. That was part of the $20.9 million in funding from different levels of government the ICF has said it could use to get passenger rail started again on Vancouver Island.

The RDN also passed a motion in March saying the board “does not support the retention or continuation of Granneke Management by the ICF board.”

“There’s nothing new in the report for me,” said Lefebvre. “It’s very damaging to the CEO, there’s no doubt about that.”

Lefebvre also said he’s concerned “there’s no business plan” and he urged the ICF to get on with the project.

“If they are so convinced the $20.9 million will get the railway up and running they should go to tender,” he said.

RDN board chair Bill Veenhof also said Tuesday he wasn’t surprised by the contents of the aKd Resource report.

“It’s an affirmation of what many of us have been saying,” said Veenhof. “To stick their head in the sand on this would be dangerous for the ICF. Certainly the lack of transparency of the ICF has been a huge impediment to its success.”

The ICF issued a statement Tuesday afternoon in response to the aKd Resource report, saying it has already initiated some of the recommendations in the report and remains confident in Bruce’s abilities.

Here’s the entire text of the ICF statement, attributed to board chair Judith Sayers:

“Island Corridor Foundation Directors will review the recommendations found in the aKd report at a special meeting of the board. Several of the recommendations are already in effect and all will receive serious consideration. It was decided at the July board meeting to open the Annual General Meeting to the general public.”

“The recommendations concerning financial reporting aspects of the Foundation will be reviewed with our auditors and those that have corporate legal implications will be discussed with our solicitor.”

“The Island Corridor Foundation (ICF) has initiated a number of steps to provide better communication amongst members including the establishment of the liaison committees. The ICF does not restrict board members from reporting to their respective organizations; however the Schlenker decision has caused individual ICF directors considerable consternation in reporting to their boards. A common reporting process accepted by all members and councils is a good recommendation to review.”

“The ICF Board works closely with our CEO and we have complete confidence in his ability to manage the daily affairs of the ICF. Staff and board members have attended regional board meetings, local government and First Nation council meetings and have organized special meetings for councils and boards.”

RDN chair Veenhof said he supports the two recommendations in the report that are specifically targeted to regional districts, including one that asks RDs to consider nominating people for the ICF board from the community based on specific skill set requirements.

When the RDN pulled its funding commitment in March, the ICF pointed to reasons for delays in the restoration of passenger rail service and what it intends to do to replace the $950,000 the RDN pulled off the table.

“The lengthy funding process has been complicated by conditional agreements involving five regional governments, the provincial government and VIA Rail before the federal government would sign‐off,” an ICF released stated. “The Government of Canada sign‐off was delayed by the federal election in October and then earlier this year by the Snaw‐Naw‐As First Nation (Nanoose) filing a civil claim against the ICF and Canada. The ICF filed a response at the end of February and the Government of Canada will file by the end of March. The ICF board will investigate other funding and operational alternatives through consultations with ICF stakeholders and the railway operator, Southern Rail. The ICF remains open to working with the RDN and other partners to secure the funds to make rail on Vancouver Island a reality.”

The ICF is a not‐for‐profit corporation established specifically to preserve the 319 kilometre rail/trail corridor between Victoria and Courtenay, Duncan to Lake Cowichan and Parksville to Port Alberni. The corridor includes both rail and trail initiatives. Formed in 2003, the ICF is a registered charity, run by a board of 12 directors, representing 11 First Nations, five regional districts and two directors‐at‐large comprised of stakeholder communities along the corridor.

Passenger rail service on Vancouver Island was discontinued in 2011 due to unsafe track conditions. The ICF, mostly through Graham Bruce, has consistently said it could get passenger rail service running again from Victoria to Courtenay with about $21 million from its partners, including the RDN. Some politicians and RDN board members, including those from Parksville, Qualicum Beach and surrounding areas have disputed that claim.

 

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