You know the wheels are coming off the bus when the Winnipeg Free Press turns on the Canadian Museum for Human Rights.
"Overruns already?" asks the FP editiorial on Saturday.
The newspaper now professes concern that the cost of the high profile project "could go wildly out of control."
The museum's board of trustees informed Parliament this week that they miscalculated their operating costs by about $5 million (23 percent). Oh, and construction inflation is eating up another $1.2 million a month.
None of this comes as news to readers of The Black Rod.
Two weeks ago we flagged the addition of $5 million to their operating costs. http://blackrod.blogspot.com/2009/02/canadian-human-rights-museum-scamarama.html
And nine months ago we told you all about the construction inflation. Funny how the FP didn't think it was news then.
Saturday, May 10, 2008
The Canadian Museum of Human Rights: Follow the money
It turns out the Standing Senate Committee on Human Rights held a hearing into the human rights museum Monday, March 3, 2008 before passing the law making it a national institution.
Senator James Cowan asked:
" ...you say that the budget to build and fit up the museum, including exhibition development, would be capped at $265 million. These projects have a tendency to run over the expected costs. Who will pick up the tab if the costs exceed $265 million? "
Lyn Elliot Sherwood, Executive Director, Heritage Group, Canadian Heritage, answered.
"The board of trustees will be accountable for bringing this project in on budget and making decisions with respect to the building design and the contingency fund set aside that allow it to bring the project in on budget."
So the people who have failed to raise the private sector's portion of costs are now responsible for cost overruns.
Oh wait ... there's a contingency fund built into the $265 million budget.
Sherwood said the contingency fund was 15 percent.
Or about $40 million if our math is correct.
"That has been factored into planning and is one of the reasons for the urgency of this bill because at the moment the purchasing power of that $265 million is being eroded at the rate of between $800,000 and $1.5 million per month." said Ms. Sherwood.
Overruns already? Hell no.
The overruns have been running since well before last May, eating up every penny donated in 2008 and more.
The museum trustees say they were blindsided by city taxes. Hence the $5 million hole in their operating budget.
You see, as the museum's website tells it, on June 28, 2006, the City Council unanimously approved a $20 million contribution to the Museum in cash and in-kind donation in the form of land, infrastructure, and forgiveness of property taxes.
The problem is, that was then and this is now.
Then, the museum was seen as a privately-run operation, Izzy Asper's pet project being stage managed by his daughter Gail.
But in August, 2008, it officially became a government-run museum (so that the Aspers could tap into tax money to build and run the place). And the city collects taxes (actually payments in lieu) from the federal government.
We can't wait until millionaire moocher Gail Asper comes cap in hand to city council begging them Oliver Twist-style to turn over the federal government's millions. T-shirt sales have been slow. Canwest Global is teetering on the edge of bankruptcy. "Please sirs, I want some more."
But it makes you think. The FP raised a stink about conflict-of-interest at city hall over an inflated $230,000 tax bill for land near the mayor's ball park, but never raised a peep when the same city councillors turned over as much as $5 million to the millionaire Aspers.
It goes to show you how much silence you can buy with a lucrative contract to print the National Post.
No Post, and suddenly its "Overruns already?"
Let's see if the FP actually does any real reporting on the financial problems of the CMHR:
* They've failed to raise $3 million of the private share of the project.
* They owe taxes to the city from last August at least.
* They're watching their costs go up $1.2 million a month, and nobody will admit how long that's been going on.
* They conceded last month that the announced cost of the project, $265 million, is four years old and likely way out of date.
The new scam is to pretend that once they get tenders for construction out they can miraculously fix costs.
Tell that to Manitoba Hydro which had contracts in hand when they started building their downtown headquarters, only to watch costs head north of north. And tell that to the City officials who thought they had costs to the water treatment plant pinned down, before they went "wildly out of control."
The Asper Foundation announced the other day it is making another $3 million payment on its commitment of $20 million to the museum. This brings to $17 million that they've delivered, they said.
That got us to thinking.
The Museum Foundation has already spent $14 million. The Western Diversification Fund coughed up $5 million 2007 and $5 million in 2008 (with another $5 million to come in '09). And that was on top of about $3 million in seed money before that.
So about $27 million has already been spent, more than ten percent of the total budget, and what do we have to show for it? A bill to truck in dirt to stage a phony sod-turning.
There's one more aspect of this sordid scam that's been under the radar so far.
Did you know the Canadian Museum for Human Rights is exempted from the federal Access to Information Act?
That's right. They'll be collecting $21.7 million from taxpayers and you can't ask what they're spending it on.
Is that a problem?
In 2002 or 2003 someone filed a request for information from the department of Western Economic Diversification "relating to the construction of the Canadian Museum for Human Rights" . The Asper Foundation went to Federal Court to stop the release of the information.
Two years later, this small item appeared in a government annual report:
l) Judicial Review
In 2002-2003 WD received its first formal request for judicial review. Western Economic Diversification received a request under the Access to Information Act for records pertaining to the Canadian Museum for Human Rights. The proponent, the Asper Foundation Inc., objected to the disclosure of any of their information submitted to the Department and applied for a judicial review to the Federal Court of Canada in accordance with Section 44 of the Act. During the 2003-2004 fiscal year, they withdrew their application to the Federal Court of Canada and Western Economic Diversification negotiated with the Asper Foundation to release of the remaining documents in question.
We don't know exactly what the Asper Foundation wanted to keep secret, but could it have anything to do with the documents that prompted this April, 2005, story in the Winnipeg Free Press…
"Ottawa-Proponents of the human rights museum wanted taxpayers to foot the bills for limos, gourmet coffee and hotel- room movies at the same time they were requesting $100 million from the federal government for the project.
Documents obtained by the Free Press show Ottawa rejected nearly $24,000 in submitted expense claims, including a bill for a meeting with Prime Minister Paul Martin and a consulting contract for ex-Winnipeg mayor Glenn Murray.
The bills from Friends of the Canadian Museum for Human Rights were submitted as part of a previous agreement under which Ottawa will pay up to $2.3 million of the developmental costs for the proposed museum at The Forks.
The claims - deemed ineligible - came as Winnipeg's Asper family was mounting what would be a successful lobbying campaign to secure $100 million from the Martin government.
Among the $23,779 in claims Ottawa refused to pay were: $865 to London Limos; a $300 cash advance to Gail Asper related to her private meeting with the prime minister in Winnipeg last September; $248 for four claims under the heading of "gourmet coffee"; $50 for in -room hotel movies; $6,297 to the law firm Pitblado for legal expenses related to negotiations with the federal government over further funding; $12,432 to the Murray Group, a consulting firm headed by former Winnipeg mayor Glenn Murray"
Thanks to the federal government exemption, pesky reporters are now cut off from information like this.
Gail Asper doesn't have to worry that you'll find out which fine cities around the world she'll be visiting--- to study their fine museums, of course --- and which of her close friends she'll be taking with her---to study those fine museums, of course--- and which fine hotels they'll be staying at, and how much those fine wines and coffees cost, or how much Glen Murray might be billing you for his fine consultating services.
If that ain't her right as a millionaire, then what's this exercise all about anyway?
Professional Reporters at Work
Here's how the CBC reported the museum's tax problem:
Human rights museum facing $5M tax bill from Winnipeg
Last Updated: Friday, February 27, 2009 2:41 PM CT
The Canadian Museum for Human Rights is contemplating ways to pay an expected $5-million tax bill.
The museum, which has been in the planning stages for years and is to start construction in April, recently tabled a report stating that its annual City of Winnipeg tax tab will be $5 million.
The Manitoba government is putting $40 million toward the project and the City of Winnipeg has approved a $20-million contribution in cash plus land, infrastructure and forgiveness of property taxes.
In the same story the CBC says the museum will
A) owe the city up to $5 million for taxes and
B) owe nothing because the city promised to forgive the property taxes.
None of the professional reporters or editors thought this was strange and that it might require some further explanation.