Saanich’s top bureaucrat promises the district will protect the financial interest of residents after a report raised concerns about the financial accounts of a charitable foundation that plans to restore passenger rail service to southern Vancouver Island.
Chief administrative officer Paul Thorkelsson said the district “will continue to put the interests of residents and taxpayers at the forefront of any decisions” concerning the Island Corridor Foundation (ICF).
Thorkelsson made this comments after council had received a report that questioned the ICF’s ability to manage money and maintain open lines of communication — findings that the ICF has challenged.
While any future passenger railway service would not run through Saanich, it has a financial stake in ICF through the Capital Regional District (CRD).
It joined four other regional districts and fourteen First Nations establish the ICF for the purpose of managing 223 kilometres of railway line from Courtenay and Victoria with plans towards restoring passenger service.
Montreal-based Via Rail operated passengers trains until March 2011 when unsafe track conditions led to their shutdown. ICF owns and maintains the track while advocating for service to return. To this end, it has secured millions of dollars in funding promises from federal, provincial and regional governments, including the CRD, which has promised $1.2 million towards the project.
Under current funding arrangements, Saanich contributes 40 per cent to this amount — or about $480,000.
Andy Orr, senior manager of corporate communications with the CRD, said this money still remains in care of the CRD, because its commitment towards the ICF remains contingent on the foundation being able to secure matching funds and completing certain kinds of work.
“So we have collected [the money] from the taxpayers, but we have not yet given it to the Island Corridor Foundation,” he said.
Thorkelsson said Saanich is “supportive” of efforts that continue to “explore options for an integrated rail system in the region” and maintain open communication lines with the ICF.
It has been the subject of several less-than-flattering headlines about its ability to deliver on past promises and maintain transparency, failures that feature prominently in the report from aKd Resource that council received received last month.
It finds among other points that the ICF’s “day-to-day performance and attitude” has resulted in a “loss of trust, confidence and credibility” that threatens to undermine efforts to create what would be a valuable transportation service.
“Much of this dissatisfaction,” the report reads, “was generated in the last couple of years when expectations were raised by overly optimistic predictions and public promises of funding expectations, contracts and agreements, which did not materialize.”
Earlier this year, the Regional District of Nanaimo (RDN) terminated its financial contribution agreement to the ICF in promising to return $799,000 in tax money already collected for the foundation.
According to published reports, RDN chairperson Ben Veenhof said the district had become impatient with the pace of the project.
The aKd report also raises concerns among elected officials about the perceived absence of a financial plan.
“For the ICF not to make public a business plan that confirms and supports their commitment to pursuing rail on the corridor is not acceptable nor in the best interests of the citizens of Vancouver Island,” it read.
The report also includes language that raises concerns about the financial viability of the foundation. “Current assets of $434,741 are insufficient to cover current liabilities of $1,324,681, making liquidity a concern,” the report read.
Judith Sayers, who chairs the ICF’s board, said in an interview that the ICF has more than enough assets in form of land and other means to cover its debt. “We have no financial issues,” she said in echoing the ICF’s official response to the report available on its website.
Overall, the ICF, is working on implementing the report’s recommendations and looks forward to improving relations with the various regional districts.