By David Rider, Toronto Star, Fri., Oct. 21, 2016 – Two political allies of Mayor John Tory are among consultants working with Toronto Hydro on issues related to a proposed privatization of the city-owned utility, the Star has learned.
A list of Hydro consultants includes Bob Richardson, Edelman Canada’s executive vice-president for public affairs, who co-chaired Tory’s 2014 campaign, and Nick Kouvalis, co-owner of pollster Campaign Research and a senior strategist in that campaign, sources say.
Others include a privatization finance expert who worked on the Ontario government’s Hydro One sale.
Richardson said it is up to clients to decide if they want to identify consultants.
“I will say in the case of Toronto Hydro we competed (in a process) last May-June to become one of their agencies of record,” for use on contracts, he said.
Kouvalis did not respond to the Star’s calls, emails and texts Friday.
Hydro chief executive Anthony Haines declined an interview request, saying through a spokesman: “The decision to sell any part of Toronto Hydro is the decision of our sole shareholder, the City of Toronto. Toronto Hydro does not comment on market speculation or rumour.”
Councillor Janet Davis, an opponent of selling Hydro, which paid the city a $60 million dividend in 2014, called the consultant details “truly shocking.”
“They hired Deloitte to do an evaluation of the company, but who authorized Hydro to hire a whole team to do polling and messaging and legal work to sell the concept of privatization to people?” Davis said in an interview.
“It is clear the mayor favours privatization. Hydro hiring some of the people who helped him get elected looks concerning and may be a conflict of interest. It appears there is a plan underway not just to investigate financial information but to come up with a plan to sell privatization to the public.”
Tory’s spokeswoman Amanda Galbraith said in an email: “Nick Kouvalis and Bob Richardson are two of the best and brightest in their respective fields. Their association with the mayor’s 2014 campaign should not and does not preclude them from working.
“There are rules in place for all city agencies and departments, as well as strict procurement processes to ensure there are no conflicts of interest. The mayor’s office has no role in hiring decisions at Hydro or any other city agency.”
Scott Travers, president of the union representing Toronto Hydro engineers, which argues privatization would decrease public accountability and raise hydro rates, called hiring Tory allies “inappropriate.”
The Star revealed last January there was behind-the-scenes work to set the stage for a partial Hydro sell-off to free up money for capital projects including Tory’s signature SmartTrack transit plan.
In May, the mayor and city manager said city council should consider the partial sale of city assets including Toronto Hydro to help fund transit expansion and social housing repairs.
Council voted in July to direct city staff to study and report back on possible asset sales.
In September, Tory used a major speech to argue, “We have an obligation to look at all the options including unlocking the value that already exists in Toronto Hydro, while keeping (a majority of) it in public hands.”
Sources say Deloitte won a contract posted in August on a city website — and later removed — to review the city’s investments in Toronto Hydro and Toronto Parking Authority and recommend “options going-forward, for the purpose of optimizing city financial returns.” Deloitte would not confirm this.