Questions remain after Prentice grounds Alberta’s fleet

EDMONTON – Alberta’s taxpayer-funded fleet will be grounded by early December, a government source says, but it may be much longer before the actual costs of the move are known.

The decision to scrap Alberta’s controversial taxpayer-funded fleet came on Sept. 16, shortly after Jim Prentice was sworn in as premier. Since then, the fleet hasn’t been used by government ministers, only civil servants under a revised approval process.

The government initially gave a four-month window to shelve the fleet. But Air Transportation Service employees were told in mid-November flight operations would end Dec. 5th, an official says.

“It’s disappointing,� said the official. “Every effort is being made to save the department and show that it’s financially viable.�

The Journal has granted the official anonymity to protect a potential loss of livelihood.

Prentice’s decision to ground the planes followed months of allegations of abuse under Alison Redford’s government. In August, auditor general Merwin Saher issued a scathing report concluding Redford derived a personal benefit from the planes. The fleet cost $9.3 million for 2012, nearly $4 million more than a “combination of commercial airline options and driving,� the report said, and the department needed to explain the value for money.

Staff say they were repeatedly told their jobs were safe, then learned otherwise at the news conference. In the days after the announcement, Prentice told the Journal the 27 members of the department — including 14 pilots and six unionized workers — would be treated in a “careful and humane� way.

But the official said ATS employees have been ignored. In early October, they sent Prentice a letter asking for the consideration of alternatives to an outright sale, like spinning off the fleet into a Crown corporation. If the government decides to privatize the fleet, the staff has asked for a year’s severance. They haven’t heard anything in response.

Not only does ATS staff say questions about security and convenience have been missed, the apparent economic rationale might not make sense. The $9.3-million annual cost mentioned in Saher’s report may have been inflated by costs of repairs to one of the government planes. Similarly, the $5.4-million alternative for “commercial transportation and driving� doesn’t account for the likelihood of charter flights. There’s also the undisclosed costs of breaking a 10-year lease for a hangar at the EIA.

“They’ve sent in the cleanup crew to get rid of us as quickly and as cheaply as possible,� the official said. “They have spent as little time, as little effort and as little compensation as they possibly could.�

The government won’t confirm Dec. 5th is the final date. Citing ongoing negotiations and competitive information, they have not provided an estimated cost for a 10-year lease for a hangar at the Edmonton International Airport, or the penalties of breaking it a little over one year later.

The September 2013 lease was a 10-year deal for one of four bays for a $26-million site controlled by Airside Properties Ltd., a three-way partnership between hotel Sawridge Properties, York Realty and Morningstar Partners. Documents show that Morningstar Partners is owned by Don Wheaton Ltd., The Ledcor Group, Interward Capital Corporation and a numbered company controlled by family of Darryl Katz. Each Morningstar partner has an approximate 8.3-per-cent stake in the hangar.

Alberta Infrastructure spokesman Dave Prisco said the government spent nearly $2 million in moving from the City Centre Airport to the facility at the EIA. The $1.6 million in renovations began in October 2013 and included a $100,000 security system and $125,000 for furnishings. Spaces were designed to store airplane parts, maintenance equipment and room was created for staff and pilots. All renovations were stopped as soon as Prentice made his decision.

“Our objective is to get the best possible deal for taxpayers. No final decisions have been made,� said Prisco.

On recent trips, Prentice has flown a combination of commercial and charter flights. In the future, the government will use pre-qualified charter airliners with pre-negotiated rates, on an as needed basis.

A bidding process was opened in September for fixed-wing, twin-engine pressurized planes to seat up to 10 passengers. The government has already received multiple bids.

The deadline for submissions will be the end of the year, when bids will be evaluated by Service Alberta.

bwittmeier@edmontonjournal.com

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