Seeking answers from CityWest

The company at the forefront of the information age in Prince Rupert, has been curiously uninformative over happenings within its own building of late.

Over the last couple of years a cone of silence seems to have been put in place at CityWest. A silence which is particularly apparent when it comes to such matters as the requirement for annual meetings (which the company has skipped), as well as in providing dividends (which they’ve reduced) to the shareholders who also double as taxpayers to the city of Prince Rupert.

These are both issues that have not been addressed by CityWest in recent times, nor do they seem to be of great concern to City Council, which is supposed to be watching out for the taxpayer’s interests. In fact the city’s own words are coming back to haunt them on this file, as the prospect of getting information on CityWest “through city council”, isn’t something that leaves residents with a lot of confidence of late.

Leanne Ritchie of the Daily News penned an informative editorial page piece on the issue, which recounts some of the recent history of the telecommunications company, as well as asking some important questions about what is going on with the city owned company.

Clearly they have a Public Relations problem brewing at CityWest (and perhaps at City Hall as well), as accountability seems non existent and credibility is dwindling as the silence continues.

Considering the fact that it’s the goodwill (not to mention the financial contributions) of the people of Prince Rupert that makes the company tick, they may wish to be a little more open and less secretive about how they are going about their business.

The shareholders (who are also the customers) are waiting for some indication that the company that they are frequently told is theirs, really does belong to them and is receptive to their concerns.

LACK OF INFORMATION RINGS ALARM BELLS
By Leanne Ritchie
View Askewed
The Daily News Editorial Page
Wednesday, October 17, 2007
Page 4

When the City of Prince Rupert incorporated CityWest in the summer of 2005, former administrator Victor Kumar made two statements that have proven false.

First, he said the newly incorporated company would hold annual meetings that would be open to the public and all the public would be encouraged to attend to find out how their asset was doing.

Council backed him up, saying that after incorporation, the asset would still be “public” and the people of Prince Rupert would still get information through council who would act as the formal shareholders.

“We hope the public will participate (in the annual meetings),” he said. “It’s their company. It’s owned by the taxpayer.”

Despite a requirement for annual meetings in its articles of incorporation, CityWest’s board has had no such meetings in the two years since the company was incorporated and the public has gone from receiving every little tiny detail of the company’s operations to knowing absolutely nothing.

Secondly, Kumar said the company had to be incorporated – changed from a department of the city to a private company – in order to remain competitive. It was the only way the taxpayer’s would retain their $2 million dividend.

Well, as new CEO Dan Rodin finally outlined at council last week, not only did the city receive only half of the $2 million divided in 2006, they only received half again in 2007.

All this freaks me out. First off, clearly as taxpayers we have been lied to. I can get more information from Telus and Rogers quarterly reports than I can about CityWest. It should be noted even the port corporation – as a business owned by the taxpayer – opens its books once a year to the public as a legal requirement.

Secondly, we were not consulted on, or even informed in a timely manner, about the decision to half the city’s dividend for the past two years. And we have not had the opportunity to question council about the company’s operations.

(How much did the fibre link to Terrace cost? How much has been invested in new capital? How much debt does the company have?)

Consider that this decision would have resulted in the city being able to decrease taxes for the past two years, rather than increasing them.

In 2007, the city increased the taxes it was collecting from residents by $360,000, or 3.2 per cent. In 2006, it increased taxes by $516,000 or 4.8 per cent.

That increase would have been covered off by just one year of the full dividend being paid.

This leads me to enquire why wasn’t the dividend paid Council says it was because CityWest is in a period of growth, but how would anyone know since we have not seen the company’s annual financial statements.

We don’t know that it could not have been paid, we don’t know if it wasn’t paid to pay for assets or to pay off the $23.5 million loan the company took to buy Monarch. We don’t know anything and that’s a disgrace.

People should be outraged about this- they’ve been lied to and left blind when it comes to an important legacy left to them by the city’s founders, a municipally-owned telephone company. It’s time to pick up the phone and demand some answers.