(WINDSOR, ON) – By now, you have likely heard about the $2 million stashed away at the Windsor-Essex Economic Development Corporation by now. For some, like Drew Dilkens, the revelation was flabbergasting. For others, like some cynical people, the news is par for the course, if not unexpected.
At a news conference for the 2016 Windsor budget, Dilkens disclosed not only that WEEDC has been sitting on $2 million, but that he had known the tidbit for at least two months. He said he was flabbergasted and surprised at the size of the reserve fund at the Development Corp.
Dilkens then went on to throw the Corporation under the bus for not spending the money on budgeted programming. Strangely, however, Dilkens sits on the Board of Directors for WEEDC, which prompts the question, “Why didn’t you know about this?”
During the 2014 Annual General Meeting of WEEDC, sponsored by the Windsor Family Credit Union, and held on June 19 this year, Dilkens and Essex County Warden Tom Bain delivered the Funders’ Remarks regarding the Annual Report. Did they not read the report or look at the financials?
Or maybe, when WEEDC’s Secretary Treasurer, Roy Verstraete, presented the audited financial statements, the pair weren’t listening. After all, former vice-chair, and now chairman at WEEDC, Marty Komsa, of the WFCU, said that the $2 million had built up over a number of years and was fully disclosed.
“For someone to come up and say, ‘Geez, we didn’t know about that,’ is not fair,” Komsa told local media. “Before you make a comment like that you should do your research. It’s your obligation to know that.”
The money has been building since 2010, apparently. Bain, who also said he was unaware of the total funds, says four positions at the Corporation were left vacant. Just how much are people getting paid at WEEDC? He went on to say that the money in reserve continued to grow, but that it was being used. Huh? Does he mean budgeted, but not spent?
Komsa says that the plan was also to have money in reserve to woo large potential investors. But there hasn’t been much of that going on at WEEDC.
“You build up the reserves with your surpluses so that when someone comes knocking on your door with a development, you’ve got something to use to put the proposal together,” Komsa continued. “These investments don’t fall out of the sky. They take a lot of effort. You have to provide potential investors with a significant amount of information, with statistics from population to wages to real-estate comparisons. It’s a very long process.”
Except that funds are supposed to be used to attract businesses to the region, not spent on companies already, “knocking on the door.” And the statistics about which Komsa speaks are already available on the WEEDC website.
“It’s not like the money is wasted,” Komsa said. “It’s money sitting in an economic development account that will be used for economic development.” However, it’s only grown each year with relatively little actually being spent.
The explanations don’t check all the boxes.
Leamington mayor John Paterson thinks there may be a deeper issue at WEEDC.
“If the board of directors don’t know what’s going on, then maybe we have bigger problems than we’re realizing” he said.
In 2013, the reserved, or as WEEDC terms it, restricted, funds totalled $1.2 million. That grew within a year to $1.9 million, or by $700,000. Considering funding of WEEDC is listed at $2.1 million, the corporation held back roughly 33% of revenues.
WEEDC had a budget shortfall, in 2009, of $8,922. A year later, there were restricted funds of $588,000. Not surprisingly, however, the Corporation had received an increase in funding in 2010 of just under $600,000. It would appear that increase wasn’t spent to the tune of a full 25% of core funding.
Now, in a rush toward damage control, some of the restricted money may be returned to Windsor and Essex County. Ahead of the December 11 board meeting, the directors have decided to give back a portion of the $2 million, but just how much won’t be known until the board decides and votes.
“This morning’s decision by Dilkens’/Francis’ friend WEEDC Chair Marty Komsa should be a clear signal to everyone as to who really controls WEEDC,” Paterson wrote on social media. “And it isn’t the County.”
It has already been suggested that the City of Windsor is desperately in need of the money for budgeting, and is said to be looking at $13.3 million in cuts. Ward 10 Councilor Paul Borrelli mentioned at an August council meeting that the city was in financial ruin. Any money returned from WEEDC would be a God-send.
The real concern is that Dilkens knew about the WEEDC surplus in September, prior to the October discussion and vote regarding an Auditor General for Windsor. The vote by council rejected hiring an independent AG that would have been able to keeps tabs on WEEDC for Dilkens. The mayor, however, cast his vote against an Auditor General.
A traditional critic of WEEDC is Ward 9 Councilor Hilary Payne. Also one to reject an AG to oversee Windsor’s finances, Payne is now calling for an audit of WEEDC’s books. Payne says he was “shocked” to learn about the $2 million surplus and termed the money as being, “… secreted away.”
“We on council should be informed on how taxpayers’ money is spent and we certainly weren’t informed in this case,” he told media. The irony couldn’t be thicker.
The fact there was a surplus is not a surprise. The total, though, is too high and the timeline of the surplus seems to indicate a WEEDC policy of socking away funds.
When Dilkens knew, and the fact that he withheld the information from Councilors until he could utilize it for political purposes, is the real issue. He knew for two months before coming clean. The information was material to the Auditor General issue. But he didn’t disclose it until he needed the money returned to go toward his budget shortfall.
With all the finger pointing going on between WEEDC board members, did Dilkens actually discover the surplus and ask for it back, but was denied by WEEDC? Did he go public at a budget press conference to force WEEDC’s hand?
Windsor Council must demand answers from Dilkens. They must Challenge the Chair. However, only an Auditor General would be able to have Dilkens answer under oath.
Ian Shalapata can be heard at 8:30 pm every Monday evening and noon every Wednesday co-hosting Talkin’ ‘Bout Windsor on CJAM 99.1 FM. Listen on demand to previous episodes or catch the discussion live and join in. Talkin’ ‘Bout Windsor is broadcast every Monday and Wednesday to the Windsor and Detroit listening area and streamed online at CJAM.