Minister satisfied with Village of Baddeck's progress in sorting out finances

Nova Scotia's municipal affairs minister will not be renewing an order for the Village of Baddeck to clean up its financial and governance issues.

The village has been in trouble since October 2021, when its former chief administrator was fired over the finances.

Municipal Affairs Minister John Lohr issued two orders for the village's elected commissioners to straighten things out or face being replaced.

Late last week, he decided Baddeck officials have been doing their best.

"We feel that they've substantively fulfilled the ministerial order to the extent that is physically possible," Lohr said in a telephone interview.

"We're not happy about what happened, but we can't go back and change it. You know, this is a recognition that we simply have to move forward."

Former chief administrator Megan Cooper is charged with defrauding Baddeck of $28,500 and the village is compiling an insurance claim to recover that amount and its costs.

Cooper is expected to be in provincial court next month to set a trial date.

Cannot provide audited statements

The Village of Baddeck cannot provide audited financial statements for the fiscal years 2019-20 and 2020-21.

Officials have looked through bank documents and computer files, but there is simply not enough detail in the revenues and expenses to accurately say what happened to the money.

Lohr said the commission should have provided more oversight on its former staff, but he is convinced they see that now.

The department has sent the village a letter outlining the steps they now need to take, including more training with provincial staff, but Lohr said the list is not an order.

Baddeck's interim chief administrator Sandy Hudson said he is relieved, but not surprised, by the minister's decision.

"I don't think he had much option," Hudson said. "I mean, there's nothing we can do in terms of producing something out of thin air."

Steps taken

The village commission has recently increased sewer rates, raised taxes and taken steps to collect outstanding revenues and pay outstanding invoices.

It has also interviewed a candidate to replace Hudson, who retired as chief administrative officer with Victoria County years ago and only agreed to help out during the transition, and will now make that person an offer, Hudson said.

Assuming it is accepted, the candidate will have to give their current employer notice before the position can be filled.

While that is going on, the village's accounting firm will be putting together a "compilation agreement" that will provide the village with a "best guess" of the finances for the two missing years, Hudson said.

The accountants will also be finishing off financial statements for the last two years, Hudson said. With that done, the village will apply to the Nova Scotia Utility and Review Board for increased water rates to cover a mounting deficit in the water account.

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