City launches major review

Interim CAO said accusations made by former deputy will be big focus of process

The City of Charlottetown has launched a thorough investigation into accusations a former employee made in 2019 about financial irregularities, adherence to city bylaws and potential breaches of provincial law.

At a special public meeting of council on June 27, interim chief administrative officer Donna Waddell was asked to conduct an organizational review as well as an internal review of the city corporation’s operations.

The review will get underway on July 7 and follows the controversial departure of

Peter Kelly as chief administrative officer (CAO) this spring as well as the two deputy CAOS Kelly fired, Scott Messervey in 2019 and Tina Lococo on April 3.

“The one thing they wanted from me was to review all of those accusations out there, review all of them and see if our policies are out of line; to see if our procedures are out of line; if there is a problem and whether we are complying with the rules,’’ Waddell told Saltwire Network in an interview inside her office at city hall on July 6.

Waddell is referring to numerous accusations made by Messervey, who was fired by Kelly. After Messervey was fired, he provided council members with a detailed list outlining 18 areas of concern where he said the city was breaking its own financial rules and not complying with the Municipal Government Act (MGA).

Messervey’s concerns included capital cost overruns worth millions of dollars, instances where the CAO had ignored advice of finance staff and the city tendering for police ticketing software that was done outside of the city’s tendering process, as well as concerns about meal expenses and per diems that were claimed at events where meals were already included in the cost.

Waddell said she has solicited the help of Michelle Burge, the city’s primary auditor, and former provincial auditor general Colin Younker to carry out an organizational review.

“We will look at each and every one of those accusations,’’ said Waddell, who came out of retirement in May to replace Kelly as CAO, who was terminated without cause this past spring.

Waddell had previously spent 25 years with the city as director of corporate services.

“We’ll take all of those points and all of those accusations … and then we will go to our external consultant who we haven’t hired yet. It will be an independent external consultant. I am in conversations with three people now. They will not be connected with the city in any way, shape or form.’’

Waddell said the consultant will report back to the city in the next few months on what it has been doing right and wrong.

The organizational review and external audit will examine aspects of the city corporation’s operation, such as policies, bylaws, expenses and procurement bylaws.

Mayor Philip Brown promised an organizational review would be done during his campaign in 2018, but it never got off the ground.

“When I arrived on council there wasn’t an appetite for it, so here we are several years later,’’ Brown said. “This has arisen because of what transpired with (Kelly), and

“I think it will clear the air on the suspicions that are out there.’’

Mayor Philip Brown

I welcome an organizational review. I welcome a review of our operations. I think this is a great step forward. I think it will clear the air on the suspicions that are out there.’’

Waddell has also begun the process of conducting a governance review that will specifically look at how the city operates as a corporation.

That will include a review of the corporate structure.

The city used to operate with a senior management team that included a director of corporate services, which is what Waddell did for 25 years, a director of public services, a job that was last filled by the late Joe Coady, and the CAO.

The MGA changed the model, did away with the directors and introduced the position of the deputy CAO.

The governance review will also take a look at the role of the CAO.

The city will issue a request for proposals for a consultant to come in, look at the CAO’S job, how the person in it operates and makes decisions and compare that to council’s expectations.

Waddell said she will be reporting to council on the progress of the review and, ultimately, will bring recommendations for any changes that may come as a result.

“There is a perception (with the public) that there’s been wrongdoing and misappropriation of funds,’’ Waddell said.

“This financial review is to try and allay those fears that, indeed, there is nothing wrong. And, if mistakes were made, we will correct them. That’s really important.’’