Exhibition’s financial problems raise some questions
By Lethbridge Herald on March 8, 2024.
Editor:
The Lethbridge & District Exhibition has been in the news quite frequently lately, mainly as a result of the construction of the new pavilion east of Henderson Lake.
The LDE convinced the province and the City of Lethbridge to provide funding for the construction in the form of grants and a loan.
The Province provided $27.8 million and the City $25 million. At the time it was reported that the $25 million would have no impact on the day-to-day operation of the City and it would not result in a property tax increase. The City also agreed to loan $17.8 million dollars to the LDE, so the City is in for $42.8 million and counting.
It has been clear for some time that the LDE is not generating enough cash flow to even make yearly operating expenses, let alone pay the interest on a $17.8 million loan or repay the principal amount.
Before the first customer entered the new building the board and former CEO Mike Warkentin were asking for millions of extra dollars.
In the end Mr. Warkentin and the Exhibition came to a mutual decision that they should part company. The resignation of Mr. Warkentin prompted me to contact the LDE through its website.
On Dec, 29, I asked for the 2023 compensation/benefit and severance package for Mr. Warkentin.
Mr. Paul Kingsmith, director of community engagement, replied on Jan. 4: ”Thank you for taking the time to reach out. Unfortunately we are not at liberty to discuss the salaries or compensation packages of any past or current member of Lethbridge & District Exhibition. Thank you for understanding.”
I replied that I did not understand, the City taxpayers are on the hook for $42.8 million and counting, it is their money and I think that they are entitled to know how their money is being spent. Never heard from Mr. Kingsmith again.
I next contacted the City Freedom of Information office, and they informed me that they were unable to be of any assistance.
On Jan. 25, I contacted Mr. Gallucci, who at that time was interim transition leader at the LDE. He did not reply.
On Feb. 6, I contacted Mr. Brian Sullivan, Director of Operations at LDE and he did not reply. I also visited the LDE office and I was informed that no one was available to provide me with the information I was seeking.
On Feb. 13, I hand delivered a letter to City Hall to the attention of Mr. Darrell Matthews, Chief financial Officer, City of Lethbridge and he did not reply.
It is highly unlikely that there is a regulation, schedule or law, either provincial or federally in place, that prohibits the disclosure of the information I’m seeking. I’m sure if there was I would have been told at the time of my first inquiry. So why is this information being withheld from the public?
In addition to Mr. Warkentin’s compensation/severance package, this whole affair raises some other interesting questions.
When asked for additional funding, the province refused, indicating that after due diligence, they felt that in their opinion the LDE did not have a viable business model moving forward.
Surely the City must have done the same, one would assume. Which raises the following questions: If the City knew there was no viable business model, why did they ask the province anyway, and if they did not have that information, why not?
This in my mind creates a doubt whether the people in charge of the City finances did their due diligence.
Lloyd Brierley, City manager and chair of the new board, is quoted as saying “the new LDE governance will ensure the interest of residents are at centre of all decisions moving forward.” I sure hope so, but forgive me for being a bit skeptical.
Barney Feenstra
Lethbridge
23-22
They asked the province so they would have a boogey man, that the province left them out to dry. So what we have is an LDE that is now about to be totally funded by the taxpayers, and there is no transparency in who and how much we are paying. My guess the former manager walked with 6 figures.
I do agree with you 100% on this assessment Buckwheat. Oversight of city financial spending on this specific issue and so many other city operations has been lacking for far too long, many years, and the mayors and most council members demonstrate no acceptance of responsibility for their incompetence. Instead these folks use deflecting, gaslighting and denouncing as their counterreactions to any deserving criticism of their indifference to their roles.
The lack of oversight of the city’s investment throughout this new LDE development has been not just irresponsible, but laughable. What an incredible waste of Lethbridge city taxpayer’s money !
I sincerely hope that Mr. Feenstra does get an answer to his query. I suggest that most city taxpayers would be dismissed with at best two week’s salary if they demonstrated the incompetence that was employed by LDE and city officials.
He will just get insulting remarks like,” centre of all decisions moving forward”. No one believes that. Some councilors should step down as well. Four years is too long to wait to get rid of this incompetence.
Anything to get him to go quietly in the night. Wouldn’t want him to disclose council’s plunders in this.
https://www.alberta.ca/submit-a-foip-request
The City, in my opinion, did not do their due diligence. We (the tax payer) will be stuck with this debt for a long time. The province should not have bailed them out if there is no clear viable business model. This Council who approves funding on major projects needs to be held responsible for this lack of oversight. We have seen again and again that they don’t seem to handle on the responsibilities they must have to the tax payers priorities.
Also, years back the LDE received 4.6 million to buy land out on the south east corner of the City, which they did, they bought farmland. For some unknown, untold reason, I believe the City took the land off the ex and gave them 4.6 million for Reno’s at the old buildings. As of today it is unknown if the farm land is till owned by the City and any inquiries to some council members have been met with silence. No one is talking. I believe there are currently three who were on council at that time. So they know!!!!!
I wish you good luck finding out the information you seek but from my experience the city is very tight fisted with information.
Yes councilors sure talk a lot about transparency during election time then after they are elected it gets lost in their limited vocabulary.