The company whose $25-million sole-sourced contract with the Toronto Community Housing Corporation was one of several that raised alarm bells with the auditor approached the housing agency in 2008 with a pitch: Refurbish your units more efficiently, save money and get tenants into housing sooner.
"[The company, Byng Group]are the experts, they are very good at what they do, and they saw an opportunity to significantly improve social housing in the city," said Caroline Spivak, speaking on behalf of Byng Group. The company is more than halfway through the three-year contract, which started in July, 2009, to do refurbishing work on the Toronto Community Housing Corporation's thousands of units.
"In early 2010, board chair David Mitchell directed [CEO Keiko Nakamura]to review the program to see if the program was meeting its targets and delivering value for money," said TCHC spokesman Kyle Rooks. A February, 2010, report found the program was meeting its targets and reducing the time tenants need to wait before moving in. While the report acknowledged the contract was sole-sourced, it said "to date the objectives of the program are being met and the program will continue until 2012."
Councillor Giorgio Mammoliti told The Globe and Mail he raised concerns about the Byng Group contract last year but was rebuffed.
What worries Auditor-General Jeff Griffiths is that the contract was awarded based on an unsolicited proposal and broke the TCHC's own rules - a recurring and worrisome theme he said indicates the city's arms-length agencies haven't learned from the millions spent on the Bellamy Report, the result of a 2005 inquiry into procurement practices at the city.
"Most people are missing one of the most important points," Mr. Griffiths said in an interview. "We've spent $17-million dollars on the Bellamy inquiry. And many of the recommendations in the Bellamy inquiry haven't been addressed. That's the most disconcerting, for me. We were provided a road map in terms of best practices in the context of procurement. … I can't tell you why the Bellamy recommendations were ignored."
Mr. Griffiths published a pair of reports Monday detailing a slew of "inappropriate expenditures" and improperly awarded contracts at the housing corporation. His findings showed the corporation had flouted its own spending rules.
Mr. Griffiths said he thinks Mayor Rob Ford's reaction to his audits' findings "is appropriate," although he wouldn't comment on Mr. Ford's desire to purge the board's leadership.
So far, the mayor is facing resistance in that department: Ms. Nakamura, who met with Mr. Ford very briefly on Monday evening, refused his request to leave, a source familiar with the meeting confirmed.
And the TCHC's non-politician board members did the same on Tuesday, issuing a public statement decrying Mr. Ford's call for their resignation.
"We were appointed by city council for a term that expires on Dec. 31, 2011. As TCHC directors, we have a fiduciary responsibility to the corporation i.e. we cannot simply walk away from our responsibilities," Ron Struys said in a statement on behalf of the board's seven non-elected, non-tenant members.
"If city council wishes to nominate directors to replace us, we will of course abide by the wishes of council," the statement said. "In the meantime, we have 164,000 constituents that we will continue to serve."
Mr. Ford technically doesn't have the authority as mayor to get rid of either the board - including Mr. Mitchell - or Ms. Nakamura: Council chooses the board and the board chooses the CEO.
The mayor's office is "looking at all of our options," spokeswoman Adrienne Batra said.
"The board of directors have displayed an inability to effectively supervise the management of the corporation and Mayor Ford wants them held accountable."
But it's not clear whether Mr. Ford would win that council vote: While councillors have expressed shock and anger at the audit report's findings, several have argued the new TCHC executive appear sincere about trying to fix things.
Councillor John Parker, the mayor's designate on the TCHC board, said the board and CEO appeared to take the report's findings seriously.
"If the citizen members choose not to take the hint from the mayor, I suppose the mayor will take the matter in hand. … Each of the meetings I was at was attended by very serious-minded people who took the auditor-general's comments and recommendations seriously and were determined to implement them," he said, adding that he can't say how he'll vote if the mayor brings the issue to council.
Meanwhile, both Mr. Ford and his councillor brother Doug Ford were circumspect about what they'd like to do with the housing corporation, which they said earlier this week deserves a complete overhaul.
That could mean a tighter municipal leash for the TCHC and other arms-length agencies, boards and commissions.
"Personally, I would [like to see direct oversight]" Doug Ford said. "I'm not speaking for the mayor, but Doug Ford would like to have more control over these ABCs."
But if the Ford administration decided it wanted to do away with a public-housing body altogether, it technically could: The province requires the city to maintain a minimum number of subsidized units, but those can be supplied by private landlords.