After more than 20 years at the forefront of housing and harm-reduction initiatives in Vancouver, lead members of the Portland Hotel Society are stepping away from the organization they founded.
That includes Liz Evans and Mark Townsend, who (alongside Bud Osbourne) are credited with getting North America’s first and only legal supervised injection facility off the ground.
In addition to Insite, the PHS has led the way on methadone treatment in Vancouver, needle exchange and distribution, and more controversial harm-reduction programs such as crack-pipe vending machines. PHS also operates 16 housing sites in Vancouver that are home to more than 1,000 low-income residents.
Evans and Townsend are resigning from their positions as co-executive directors along with Dan Small and Kerstin Stuerzbecher. All four members of the management team will sever official ties with PHS by March 31.
PHS’s nine-member board of directors is also stepping down. A new board will be elected at the organization’s next annual general meeting.
“We were given a stark choice,” Townsend told the Straight. “If we fought an effort to put us into receivership, our contracts that could be cancelled without cause would be cancelled. And that would mean pain and suffering for the residents that we care about. It would cause a kind of chaos. So we can’t do that.”
According to Townsend, the wiping of the PHS management slate is in response to an ultimatum delivered by the provincial government.
He explained that B.C. Housing had threatened PHS with receivership.
If PHS had come under the full control of B.C. Housing, key contracts with Vancouver Coastal Health would have been placed in jeopardy, Townsend continued. And that could have brought an end to a number of health and social services operated by PHS.
“So we felt we had no alternative,” Townsend said. “What they said was, ‘If you appoint a new board and the leadership team steps aside, everything else can continue.’ So in that regard, our first concern had to be the residents and the staff who work very hard on our various projects and services.”
News of a potential shake-up at PHS broke in the first week of March when Rich Coleman, provincial minister responsible for housing, revealed that an independent audit performed by KPMG Forensic had found “serious” problems with the way the PHS had spent money on administration fees and so-called perks for staff.
Townsend expressed surprise in response to those initial reports and has continued to downplay the severity of any alleged misspending.
“There is no one chasing us for credit,” he said today. “We have a lot of debt, but we can manage that debt. We’re more than capable of that. I’ve done this job for 21 years, and it’s always tough; that’s just the nature of these things, and it’s never been any different.”
Responding to claims in the media about flights for staff members and expensive hotel rooms, Townsend said such costs would have come out of the PHS’s administration budget, which today stands at less than nine percent of expenditures. He claimed that 100 percent of program funding is accounted for as being spent on housing, health initiatives, and other programs.
Townsend defended the spending of money marked for administration, noting that PHS staff work without pension funds and the like. He said that the organization might therefore pay for the occasional day off when an employee requires it.
According to filings with Revenue Canada, PHS revenue for 2013 exceeded $35.5 million, with 61 percent of that money coming from the government. For that year, management costs accounted for nine percent of expenses. In 2013, six full-time employees received compensation between $120,000 and $159,000.
Since news of the financial audit and subsequent resignations, speculation has swirled about political motivations for the actions taken by Coleman and B.C. Housing. For example, in early 2013, a feud between PHS and Vancouver Coastal Health over funding for a women’s program at the Rainier Hotel nearly climaxed with contracts being terminated.
Townsend said he didn’t want to speculate, and that his priority now is to ensure a smooth transition for the incoming team taking over PHS.
“My focus for the time being is going to be to work sincerely and very seriously with B.C. Housing to make sure that there is no interruption in services of the work that people are doing on the ground,” he added. “I want it to be like a blip, so hopefully, for the people on the ground that really matter, nothing will change.”
Update (March 20, 2014): Auditor's report raises questions about Portland Hotel Society executives' salaries and spending