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To the main Judicial Inquiry page - to the Hazel McCallion page.

Comments by others to this web-page  - 5 - to this web-page at time of posting.

Councillors should have known about veto,
deal maker says

An outside lawyer hired by the City of Mississauga to help broker the sale of Enersource says that city councillors should have known about a key provision that gave the purchaser unusual veto power.

During the second day of testimony yesterday at the judicial inquiry into two controversial City deals, lawyer Bill Houston said a key amendment was made to the deal with Borealis, a subsidiary to the OMERS pension fund, at the last minute.

The change, which only came to light years later, gave Borealis veto power over certain actions, such as the pay levels of Enersource board members. That power was provided even though Borealis had bought just 10 per cent of Enersource shares.  The City owns the other 90 per cent.

Houston testified that councillors should have been made aware of the "deal-breaking" change.  But, he said, all of his dealings were directly with then-City Manager David O'Brien, who later became the president and CEO of Toronto Hydro.

O'Brien was the "point man" for the deal which Houston called "the biggest deal he (O'Brien) or Mississauga had ever done."
There was enormous pressure to get the deal done, Houston said.

When the extent of the veto by Borealis came to light, several city councillors expressed surprise and said that they had no knowledge of the arrangement when they signed the deal.

Mayor Hazel McCallion said at the time that she had signed the final deal without reading it and was not aware of the last-minute change until it was later brought to her attention.

The Enersource deal, signed in 2000, is one of two major issues the inquiry, under Justice Douglas Cunningham, is examining.  The other concerns a failed $14.4 million land deal in the City Centre that involved McCallion's son Peter.

This morning, O'Brien, 60, who retired last year from Toronto Hydro, will take the stand.

The Sawmill Valley resident served for nearly a decade as city manager, including a stint when he was seconded to Hydro Mississauga to run its operations.

Comments by others - 5 - to this web-page at time of posting;

MISSISSAUGAWATCH     May 27, 2010 4:40 PM

@ ComeOn

Your title was "Hazel did not know -- Perhaps we can ask Santa". I keep telling you. Videotapes. Freedom of Information confirm repeatedly that elected officials do NOT know how the City is run. And get this. One Department doesn't even know what the other Department is doing. Here's the point. No matter how committed, no matter how brilliant, no large urban Mayor can read everything. It would require that person to be an expert on everything from transit through to quality of water and air. No do-able and unfair to expect that of any human being.

MISSISSAUGAWATCH     May 27, 2010 4:33 PM

@ Tony and ComeOn

Quote, "Houston testified that councillors should have been made aware of the "deal-breaking" change. But, he said, all of his dealings were directly with then-City Manager David O'Brien, who later became the president and CEO of Toronto Hydro." The article fails to mention that it was the City's external hired lawyer, Bill Houston himself, whose responsibility it was to advise the City of significant changes. Lax (the City's retained lawyer) pointed that out. Houston's job was to play DEE-fense for the City in this deal. Houston himself described what happened as a "comedy of errors". Wait for the transcript. You WILL be amazed.

MISSISSAUGAWATCH     May 27, 2010 4:29 PM

@ Tony and ComeOn

Yes, Hazel McCallion signed the final deal without reading it. Drop by every Wednesday and watch them approve By-Laws, Corporate Reports and even minutes of meetings without reading them. Then for fun, go to Peel Regional Council and watch Mississauga Mayor/Councillors rubber-stamp reports policies etc etc etc. Better yet, you should see what contracts Staff decide to change all on their own without informing Council even when they know it should have been sent to Council before changes were made (source: 2006 to current Audit Committee meetings). I've said it for a while now. I really don't know why there are Mayors and Councillors. Except to create the illusion of democracy/accountability.

Tony Jackson     May 27, 2010 12:30 PM

The truth.............

?Mayor Hazel McCallion??.signed the final deal without reading it..? Don?t buy that bullshit. Either McCallion has made an epic failure in executing her responsibility (extreme negligence on the job) or she CHEATED the public by letting that deal eventually OMERS paying off through her son Peter McCallion. One of them is the truth.

* Agree 2    Disagree 1    Offensive 1

ComeOn     May 27, 2010 12:16 PM

Hazel did not know -- Perhaps we can ask Santa

How does minutes changed -- added two complete paragraphs but nothing in video, a son with no money getting a half billion dollar deal with OMERS, OMERS just happens to be dealing with Hazel and her hand picked hydro board (before the current council stepped in), city buys land son gets settlement otherwise he had to make yet another payment on contaminated land -- money he apparently does not have according to recent news... I am waiting to her the magical story that sews all of this up into a nice little bow. Enough already.

* Agree 2    Disagree 1

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