Halifax CAO resigns over concert cash

Halifax Regional Municipality's acting chief administrative officer has announced his retirement amidst controversy over an unauthorized advance to a concert promoter.

Wayne Anstey released a statement Wednesday afternoon saying given the issues of the last couple of days, he felt it was the right thing to do.

Anstey approved a $400,000 grant last July to ensure the Black Eyed Peas concert on the Halifax Common went ahead.

The promoter was threatening to cancel the event. The company was also given $1.8 million in cash advances. HRM finance staff and regional council were not aware of either the advances or the grant.

"I would like to first state, that in every instance when I had a choice to make, I truly believed I was making the right choice on behalf of HRM. Of course, if I had to do it over again, I would do things differently," Anstey's statement reads.

"I found myself in a very difficult position last year, and I made a choice which has caused me to take the decision to retire.  In 2008, HRM began the practice of advancing cash to a promoter to enable the hosting of major outdoor concerts in our region. This practice was initiated to ensure that the promoter had the required liquidity to stage the concerts. As a major investor in the concerts, it was to our advantage to ensure they were a success," Anstey writes. 

"In 2010, due to less than anticipated ticket sales, there was a possibility that the concerts would not proceed.  If the concerts did not proceed, there would have been significant financial loss to the municipality. However, the practice of the advances exceeds the authority of any HRM official, violates the HRM Charter and exposes the organization to financial risk.  I knew this at the time, but I chose to proceed anyway." 

Anstey said he acknowledged his mistakes to the audit committee last week and provided a full accounting of the decisions, as well as discussions he had with the mayor.

The city's auditor general found that Anstey broke municipal rules when he provided both the cash advances and a grant to Harold MacKay of Power Promotional Events Inc. The company was behind both the Black Eyed Peas concert and Country Rockfest.

When MacKay threatened to cancel the July event, Anstey authorized a $400,000 grant based on ticket sales.

Those sales were far less than expected. Power Promotional Events went out of business in the fall.

Between January and July 2010, cash advances of $1.8 million were also made to the promoter. That money was repaid.

'Uncertainty over why this happened': Mayor

Mayor Peter Kelly said to his knowledge, any of his involvement in the situation was in accordance with HRM policy.

"For instance, a contract that I signed off with regards to the concerts that our legal staff vetted. In there, there's a clause that allows the forwarding of ticket sales to them, so the responsibility of that went back to our legal team, who are supposed to protect the municipality. If they sign off on a contract with that clause into it, I expect that means it is legal and that it is eligible to be done and that it is conforming with policy," said Kelly.

"Mr. Anstey has owned up to that issue and the legal staff will need to clarify why they signed off on contracts that had that clause in there to allow these to take place when their responsiblity is to protect the taxpayers in terms of policy and illegalities."

Kelly said he will own up to the responsibility of ensuring this does not happen again.

"I'll make sure working with council, the auditor and the audit committee to make sure there's a very defined and clear process. Without permission or without the proper process in place things do not move from one place to another."

Kelly said he will be accountable to the public in the next election.

Earlier Wednesday, Coun. Debbie Hum called for both Anstey and Mayor Peter Kelly's resignations.   Hum said the mayor withheld information from council.

"What else was he aware of and what else was he involved in?" questioned Hum.

Hum said she hopes an auditor general's report names the individuals who signed off on the cheques to MacKay's company.

Ordinarily, two senior signatures are required on cheques written by HRM. Antsey has acknowledged he got around that by giving an executive order to the Halifax Metro Centre to write the cheques directly to the promoter.

Anstey said he would remain with HRM until June 30th to ensure a smooth transition. He had been a municipal employee for the last 33 years.