Hastings Park advocate predicts PNE board fight

A politicized PNE board worries Rand Chatterjee. Matthew Burrows photo.

A Hastings Park advocate believes council’s new PNE board structure will result in a “slugfest”.

“It will be, and I don’t see how not, because you’ve got people with competing interests sitting on the board,” Hastings Park Conservancy president Rand Chatterjee told the Georgia Straight. “And that’s not the way you put a board together.”

At the May 21 meeting of the city services and budgets committee, council approved the dissolution of the current interim PNE board in favour of an 11-person board with four slots for senior city staff, one for a park board commissioner, and the position of chair for Vision Vancouver three-term councillor Raymond Louie. The other five slots are to be filled by appointing three members from the business community, one local resident, and one city-resident representative “with a labour-relations background” to staggered two-year terms.

Chatterjee said the 6-5 majority the city will have on the board is “strange” and could lead to further politicization of the PNE, which was created as the Vancouver Exhibition Association in 1907. The city took over operation on January 1, 2004.

“It’s already pretty politicized, but I think, absolutely, it’s going to be a lot worse,” Chatterjee said. “When a city governs a nonprofit charity—which is what this is—it’s a very strange thing. It’s unheard-of, partly because, as I explained, you cannot have a charitable organization managed, governed, by the body that also regulates it. It’s a conflict.”

When he addressed council on May 21, Chatterjee said he wondered how often senior city staff would vote against the wishes of the chair—Louie, who is also their boss at the City of Vancouver. This was a concern shared by COPE councillor Ellen Woodsworth.

“It’s certainly a politicization,” Woodsworth, who voted against the appointment of Louie as chair in a 6-2 split, told the Straight. “That’s one concern. My other concern is that it seems to be setting a direction for commercialization rather than greening of the park.”

In her May 25 e-newsletter, lone NPA councillor Suzanne Anton—the other no vote—scathingly referred to Louie as “king of the PNE”. Anton also claimed that “City senior staff board members will have a tough time making decisions which are different from their political boss.”

In reply, Louie told the Straight “Coun. Anton is advancing a nonissue”.

“It’s based on two false premises,” Louie said. “One, that I would, first, bully, and second, that these senior staff—educated and long tenured with the city—would allow themselves to be bullied. Which I think are both false premises that Coun. Anton has created in her mind in order to advance her position. It is significantly different than that, and Coun. Anton has her right to her fictitious world.”

When asked if this meant autonomy for city staff on the PNE’s new board, Louie said: “They have a fiduciary responsibility, when they sit on that board, to the organization and not to the chair. I don’t know how I can make it any clearer than that.”

Chatterjee said he still foresees problems.

“What happens if there’s a problem at the fair, say through a bad doughnut or a problem with the safety of the rides?” he said. “Who’s responsible? What’s the issue when the engineering department at the city, which is responsible for those rides, is sitting on the board of the entity they are trying to regulate?”

Louie said each one of the board members, when conducting their duties, “has blanket exemption, I guess, from those liabilities”.

“There’s indemnification that’s granted to those people—it’s standard practice at the city.”

Louie said he does not foresee a slugfest, based on his six years as councillor.

“I’ve said that it will be the same productive, cordial relationship that I have with senior staff here at City Hall,” Louie said. “After six years on council now, I have yet to have a slugfest with staff. I might lose to some of them.”



Rand Chatterjee

May 28, 2009 at 3:11pm

I want to set the record straight. "Conflict of Interest" is a legal term dealing with a fiduciary responsibility or duty of loyalty to distinct entities with different underlying interests; this should not be confused with "competing interests" on the Board itself--as described in this article--which are the natural and positive interplay of independent directors advocating potentially for differing stakeholder interests.

The point I was trying to make was that a city official, staff or elected politician, has a fiduciary duty first to the City of Vancouver, and all of its assets and operations. An independently-established charitable association--which may well make use of city assets--will most certainly have differing interests than the city, and must remain at arms length to be effective in its distinct mission. The most perverse example of a dangerous conflict of interest is when a regulator sits on the board of the organization regulated; that would be the case here. It is also the case that the PNE's Board will be negotiating and managing its operating agreement and leasehold with...essentially itself, with city staff and politicians holding the majority of the Board positions.

Who is advocating for the PNE here? Who is defending its 100-year-old mission?

This cannot ever be an arms-length relationship, and this inherent Board conflict (not of people, but of incompatible fiduciary duties) cannot serve either the PNE or the City. Both are certain to be losers in this uniquely misguided perversion of 500 years of common law experience.

There are reasons that no politicians or senior city staff ever sit as voting members of Boards of large charitable societies anywhere in Canada, and certainly not ones operating on city land. (Please note that the Canadian National Exhibition in Toronto is a summer agricultural fair only, and nothing like the operation in question here. The Mayor of Toronto is an honourary Board member of the CEN.)

If Vancouver wishes to be a world-class city, it must adopt world-class business practice, and respect the British common law heritage embedded in Canada's constitution.

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Matthew Burrows

May 28, 2009 at 4:22pm

OK Rand, you can have the last word...

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