MPPs told about alleged Niagara Parks improprieties in 2005

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Anthony Reinhart – November 25, 2010

Allegations of financial impropriety at the Niagara Parks Commission reached the Ontario cabinet as early as 2005, years before public controversies surfaced at the Crown agency in charge of Canada’s top tourist attraction.

James Bradley, now Minister of Community Safety and Correctional Services, said that when he was tourism minister, he received what he called “an anonymous letter that contained a number of allegations of financial improprieties” at the parks commission in 2005, but nothing came of a subsequent forensic audit by Tourism Ministry officials.

Liberal MPP Kim Craitor said he fielded complaints of wrongdoing from about 15 Niagara Parks employees in 2006 or 2007, but the commission’s then-chairman dismissed the claims as having no merit.

It took until 2009 for the government to intervene in the agency’s affairs, after a commissioner publicly complained about an untendered contract for the Maid of the Mist tour boat company. The Maid of the Mist lease, which the commission had extended for 25 years without a competitive bidding process, was overturned by the province and put out to tender.

Further investigation by The Globe and Mail has uncovered audits critical of the commission and $400,000 in travel spending by an agency executive between 2006 and 2009. That executive, Joel Noden, was fired without cause on Nov. 9, but has defended his expenses as appropriate and in line with the commission’s policies of the period.

The McGuinty government moved last year to tighten spending and oversight at all its agencies, boards and commissions after scandals at eHealth Ontario and Ontario Lottery and Gaming, as well as Niagara Parks.

Asked about the allegations made to them years ago, Mr. Bradley and Mr. Craitor said they went as far as they could, given the information they had.

Neither MPP would describe the claims in detail, but Mr. Craitor said he advised “at least one person” to go to the police. The Niagara Falls MPP said that at the time, he also reported the complaints to the commission’s politically appointed chairman, Jim Williams, who told him the claims were unfounded.

Mr. Williams said Mr. Craitor brought him “more than 15” such complaints between 2004 and 2009, but “every one was investigated and there was never any foundation to them.” If the complaints were particularly serious, and involved, for example, fraud, Mr. Williams said he would pass them along to the Ministry of Tourism, which oversees the commission.

Mr. Bradley said he forwarded the anonymous letter to ministry officials for a forensic audit. Asked who the auditors were, he said, “I don’t recall who it would be; we’d just automatically give it to them.”

Mr. Williams had a different recollection. He said he received the letter from either Mr. Bradley or Mr. Craitor, but sent it back to the Tourism Ministry to avoid the appearance of a conflict of interest.

“I was the one that actually passed it to the ministry and said I’m not going to do the investigation on it,” Mr. Williams said, adding that any inquiry he undertook “would be complained about as a whitewash or [as something] swept under the rug.”

Mr. Bradley and Mr. Williams agreed that the forensic audit found nothing.

The Tourism Ministry refused to release the letter and forensic audit report to The Globe without a formal request under access to information legislation.

Mr. Craitor said some of the allegations he heard were “significant,” but the complainants had no concrete evidence. “No one ever gave me anything,” he said. “It was just words.”

The commission, which spends $77-million a year managing 1,720 hectares of public land – including Canada’s busiest park, Niagara Falls – employs more than 300 people and is overseen by a board of 10 to 12 commissioners appointed by the province.

It funds itself entirely from its operations, including gift shops, restaurants, attractions and golf courses, but has access to government loans. It has recorded annual losses, the first in its 125-year history, for the past four years.

After then-commissioner Bob Gale complained to Ontario’s Integrity Commissioner about the Maid of the Mist lease, the tourism minister at the time, Monique Smith, ordered confidential audits of governance and procurement at Niagara Parks. Obtained by The Globe, the reports cited gaps in policies, opaque decision-making and an image as an “old boys club.”

Several changes ensued. The province overturned the Maid lease and tendered the boat tours, commission meetings were opened to the public; Mr. Williams resigned as chairman and Fay Booker, a governance and auditing expert, replaced him and undertook measures to sharpen practices and boost transparency.

Meanwhile, The Globe found that a long-serving commissioner, Archie Katzman, had personal ties to several parks contractors, and that Mr. Noden’s extensive travel bills were subject to a hazy internal approval process.

Mr. Noden has said they were approved by the parks executive in charge of corporate services, a senior management position equal to his. Official parks policy, however, gave expense authority to the agency's top bureaucrat, general manager John Kernahan.

Original article on Globe and Mail website