In putting a timeframe of 1 December 2013 to 29 June 2015 on my access to information request, I’d hoped to cast my net wide enough capture the earliest communications between port promoters Barry Sheehy and Albert Barbusci and CBRM Mayor Cecil Clarke, and if I haven’t done so, I think I’ve come pretty close.
It looks like Sheehy and the mayor first began communicating about the repair of the Gabarus Sea Wall — that’s the subject of the first email in the document dump, dated 23 December 2013 and addressed to both Clarke and Sydney River-Mira-Louisbourg MLA Alfie MacLeod.
The paper trail disappears for the next two months but it’s obvious there’s been further communication between Sheehy and Clarke because by April 2014, Sheehy is writing about Sydport and potential Chinese investors and by early May, Barbusci is in the mix, bringing with him Michael Kraft and Brad Cutsey of Dundee Capital Markets (more about Dundee in a future article).
In July, CBRM economic development manager John Whalley was asked by Mike Moore — a consultant hired through Business Cape Breton (BCB) to work on the mayor’s “port team” — to sign a memorandum of understanding with Sheehy and Barbusci, promising the municipality would not conduct direct negotiations with any “potential partners” the promoters managed to bring to the table.
The letter wasn’t included in the FOIPOP documents, Whalley gave me a copy, explaining that he’d signed it because, from his perspective, there was no harm in it because there was no cost to the CBRM:
sheehy mou 2014
I’d argue otherwise in terms of the harm this letter might have caused the CBRM, but the truth is, it wasn’t enough for Sheehy and Barbusci, who were pushing for something more official. So in February 2015, Mayor Cecil Clarke — one vote of 13 on CBRM council — wrote them a letter acknowledging them as “authorized agents” of the CBRM. Clarke said that the “authority and responsibility for port development” had been “vested” in him by council.
OfficalAgentLetter
I don’t think this letter was worth the paper it was written on and, ultimately, it wasn’t enough for HPDP either. They needed an official contract, which council was eventually convinced to grant them, largely on the basis of their claim to having spent millions of their own dollars promoting the port — which leads to the first truly interesting revelation in these documents.
Follow the money
Everything about Sheehy and Barbusci’s involvement with the Port of Sydney struck me as odd, but the real red flag for me was the assertion — reported, without question, by the Cape Breton Post on 7 July 2015, that:
Barbusci and Sheehy have already been working with the CBRM for 16 months, investing $1.2 million of their own capital into port development.
Never, during all these years, have we been presented with evidence of this spending — until, that is, today.
Readers, here is how Sheehy and Barbusci reached that $1.2 million figure:
cost_estimates
So, $60,000 was accounted for by travel and expenses, but a whopping $1.12 million represented fees they would have charged the CBRM for their services had they not been operating in that time honored tradition of international port promoters — free of charge. Sheehy and Barbusci calculated their own worth at $2,500 per day (each) and claimed to have devoted 255 of the preceding 450 days to the Port file.
I am going to go out on a limb and say that this $2,500 per man per day fee is what District 5 Councilor Eldon MacDonald was referencing when he told a CBRM council meeting as recently as December 8 that our port promoters have, to date, spent “tens of millions” of their own dollars on the project.
I am also going to note that in 2016, Cadence Communications — a firm owned by Barbusci — was paid $75,000 by the Port of Sydney Development Corporation.
Follow more money…
Sheehy expands on the services he and Barbusci have provided the CBRM in a May 2015 email exchange with Christina Lamey over the wording of a press release he’s drafted about a “consortium of [unnamed] investors” who are “participating in the next phase of research” for further development of the Port of Sydney project:
Negotiations are underway with potential port operators and shipping lines…Engineering and design consultants Bechtel…is undertaking technical and feasibility studies.
Lamey and Mayor Clarke and CAO Merritt add these lines:
Cape Breton Regional Municipality council will consider a proposal to fund one-third of the cost of the research, estimated at $650,000, in several phases. As funding partners, CBRM can access the findings at each phase to better target port marketing efforts.
But Sheehy doesn’t like it:
Christina, A lot of details around the initial studies is provided here included [sic] funding. Is this necessary and are we inviting scrutiny or second guessing? Also it would be nice to mention our work over the past 14 months which has ben entirely without compensation, covering even our own admin and travel costs. We haven’t charged CBRM a dime.
Lamey warns (correctly, I might add):
Media’s first question: “Who is paying for this work?”
Which really sets him off:
There has been a lot more money and effort expended over the last year than is reflected in the $650,000 for pre-feasibility work–and we hope much of the latter will be funded by ACOA or the Atlantic Gateway. A small fortune has already been expended in time, travel, expertise and networking across North America and around the world on behalf of the Port of Sydney. How do you put a price on Albert’s global Rolodex, which took a lifetime to build? No one noticed this expenditure because CBRM was not asked to cover any [sic] it but it was nevertheless real.
“Albert’s global Rolodex” sounds like a really awful children’s story.
I understand the press will ask about this $650,000, but why give the impression this is coming directly out of Cape Breton taxpayer’s [sic] pockets when, in all likelihood, it will not? Surely you are inviting someone to suggest the money be [sic] better used to fix pot holes. If a number must be used to show our seriousness then use $ 800,000 for pre-feasibility studies and marketing. This includes the original $650,000 plus the $150,000 fee we are plowing back into marketing and travel this year. Both numbers are real and involve significant contributions from both HPDP’s and Bechtel. This is how to spin this and it is all factual.
First, I like that Sheehy doesn’t seem to realize Cape Bretoners pay federal taxes — or perhaps he doesn’t realize that ACOA is a federal agency and the Atlantic Gateway a federal program (headed, at the time these emails are flying back and forth, by Transport Minister Lisa Raitt.)
Second, I think (based on a contract included in the document dump) that Bechtel’s “contributions” amounted to a discount on its consulting services. But even with the discount, the Port of Sydney would ultimately end up paying the company $192,906.
Which brings me neatly to my third point, which is that I don’t think CBRM council ever did consider a proposal to cover one-third of the “research” funding. First, because in July 2015, Raitt came through with $500,000 for the “Port of Sydney Development Corporation Gateway Project” as part of the Atlantic Gateway project.
But mostly because, in September 2015, Marlene Usher, CEO of the newly formed Port of Sydney Development Corporation, went to the final meeting of the Sydney Harbour Oversight Committee, and got permission to divert some of the $2.4 million left over from the harbor dredge (money intended for navigational aids) to a list of “proposed projects” that included marketing and promotion ($425,000), the container terminal feasibility study ($450,000), legal and consulting work ( $245,000), travel and conferences ( $150,000) and the branding of Port of Sydney and web site development ($75,000).
In short, she tapped into a pool of funding worth $1.3 million — far more than the one-third of $650,000 council was going to be asked to consider — and that money was used to fund the great Port of Sydney promotion adventure (see this article.)
Click to enlarge
And that’s the mystery of HPDP’s $1.2 million investment solved.
I feel like Nancy Drew at the end of a successful case. But Nancy never rested on her laurels, next up: what the FOIPOP documents revealed about the 2015 McKeil deal.
