Selling off assets shouldn’t mean bonus time for senior bureaucrats
April 9, 2018
Back on December 14, 2015 Energy Minister Bob Chiarelli directed OPG to sell its head office on University Avenue in Toronto, also directing them to pay all of the net proceeds “to the government”.
Just before Minister Chiarelli was moved from the Energy portfolio he issued yet another directive to OPG: sell off the Lakeview lands and pay all of the net proceeds to the government, “subject to any requirements under the Trillium Trust Act (2014) Ontario”.
In both cases the minister was using his authority as an elected representative of the province with responsibility for managing certain government-owned assets, which the government had presumably decided were not core assets of OPG.
The Head Office was sold in 2017 as stated in OPG’s annual report where they noted: “Higher earnings of $377 million from the Services, Trading, and Other Non-Generation segment, primarily as a result of the gain on sale of OPG’s head office premises and associated parking facility, a non-core asset of the business. A gain on sale of $283 million, which is net of tax effects of $95 million, was recognized in net income upon completion of the transaction in the second quarter of 2017.”
So, the payment(s) under that sale to be made to the province were $283 million plus the PIL (payments in lieu of taxes) or $378 million.
OPG’s press release of January 9, 2017 announcing the sale said not much more than “OPG would lease back four floors plus ancillary space.”
A couple of weeks ago in 2018, OPG announced in a press release they had sold the Lakeview lands for $275 million, subject to closing adjustments, and stated “The net proceeds from the sale of Lakeview lands will be transferred to Ontario’s Trillium Trust to fund transit, transportation and other key infrastructure projects across the province.”
The press release went on with quotes from Finance Minister Charles Sousa, Ehren Cory, CEO of Infrastructure Ontario, the Mayor of Mississauga, the President of the buyers group, Lakeview Community Partners Limited and Jeff Lyash, OPG President and Chief Executive Officer. (No quote came from the current Minister of Energy.)
The quote from Jeff Lyash, OPG’s CEO, was particularly laudatory: “OPG is proud of its role to transform Lakeview, a major source of carbon emissions for over 40 years, to a vibrant mixed-use community that will become the jewel of Mississauga’s waterfront. This site is one of the largest undeveloped parcel of waterfront lands left in the GTHA and the fourth former OPG coal plant site to transition to a new, environmentally friendly use.”
All ratepayers, who are also taxpayers, should be upset with how the sale proceeds of OPG’s two properties, were/are either being paid into the Ontario Treasury or into Trillium Trust. Those assets were paid for by ratepayers through their electricity bills, but they will see no benefit as the $653 million generated from the sale presumably went towards balancing the budget just concluded on March 31st.
Is it too much to ask that the electricity system be managed for the benefit of ratepayers?
Side note: Mr. Lyash topped the Sunshine List and was paid $1,554,456.95 last year up almost $400,000 from the prior year while Ehren Cory, CEO of Infrastructure Ontario’s bump was $60,000 to $470,758. Both received nice year over year increases!