Airport “business plan” a “fail”
July 14, 2014
Members of Council TSBP
Re: July 15 2014 agenda item 9.1 – Airport “business plan”
In the July 15 agenda there is a report presented as a “business plan” for the airport.
I do appreciate the work that has gone into the report. But unfortunately the report misses the mark, and is not a “business plan” and needs to be sent back or scrapped.
Council faces policy decisions. Decisions are usually presented to council in the form of problems or opportunities.
Council’s role is to make good decisions – decisions that are right for the taxpayers. For council this will usually mean decisions regarding how to provide adequate municipal services at lowest cost to the taxpayers. It is not a council role to use public (taxpayers’) money to provide anyone with private benefits.
In order to make good decisions that are in the public interest, municipal councils use some decision making process.
As an example, here’s the decision process that is required by the Ontario Environmental Assessment process:
1. Problem definition (or opportunity definition)
2. Generation of a range of alternative solutions.
3. Analysis of each alternative
4. Comparison of alternatives
5. Choice of preferred alternative
6. Implementation of preferred alternative.
All formal decision processes are similar.
If there is no formal decision process, the decision will as likely as not be arbitrary, and will not be optimum, and the taxpayers will suffer as a result. This is especially true for more complex issues.
It is hard to imagine decisions like the fate of the airport being made without such a proper, formal decision process.
Yet that is exactly what is happening.
Instead of going through a proper decision process, the “business plan” skips all the important first steps and jumps right to the board’s arbitrarily chosen solution. The report jumps straight to step 5 of the formal process above.
There is no problem definition.
There are only four lines of generation of alternative solutions.
There is no analysis or comparison of alternative solutions. The economic analysis is flawed, unsupportable, and useless.
And there is no proper financial analysis.
Financial analysis is the foundation of any business plan. The “business plan” in the agenda has almost no financial analysis. What is presented instead of a proper financial analysis is a list of activities and what they hope to accomplish with these activities
In fact there is no business plan, not even for the improperly selected preferred alternative. What is presented in the agenda package is not a business plan, not even with a stretch.
There is no proper selection of the preferred alternative. In fact, following the short listing of alternatives, the board indicates in the report that their decision of which alternative solution to pursue was already made before the report was even started:
“All four options are mentioned, but the Management Board, for this Business Plan, is basing their decision on retaining Certification status.”
This is very odd thing to say, as the board has no authority to make the decision about what to do with the airport. The decision on what to do with the airport is properly left to the two councils.
The airport board had an opportunity to provide some decision making information. They failed. The report, the so-called “business plan”, and the so-called “economic analysis”, need to be scrapped.
And the two councils need to start over and do the decision properly, following a rigorous decision process like the one above.