Work at Skaha Hills came to halt in April 2017 while a financial review was being conducted of economic development initiatives by the Penticton Indian Band. (Western News file photo)

‘Troubling’ financial report revealed for South Okanagan band

Coyote Cruises has deficit of $76,000 among some of the issues

Though the report is “troubling” from the group responsible for managing the economic development efforts of the Penticton Indian Band, the hope is for positive change to move forward.

“The last months have proven to be a difficult task as we routinely uncovered error upon error and misstep after misstep. We’ve managed to address many of the concerns we’ve uncovered and effect change,” said Jonathan Baynes, chief executive officer of K’uL Group.

Over the last year the K’uL Group, formerly Penticton Indian Band Development Corporation, engaged in a financial and technical review of its subsidiary companies going over financial statements and records, measuring processes to create better awareness of each company’s performance over the last five years. K’uL Group manages the business interest of the Penticton Indian Band.

READ ALSO: Coyote Cruises looking to enhance Okanagan River Channel experience

Midway through a full audit “significant concerns” have arisen.

According to the report, financial errors, poor accounting procedures and “shoddy” management practices at Westhills Aggregates, which specializes in construction sand and gravel services, has resulted in more than $880,000 in overstated income.

READ ALSO: New administration for PIB, court responses filed

The reported poor practices were also happening at Coyote Cruises, the company that operates tube rentals and transportation along Penticton’s River Channel. Overstating earnings over the last number of years occurred when they actually have a deficit of $76,000, GST penalties in excess of $17,000 for the last five years, unauthorized credit cards and unaccounted spending in excess of $9,000 and a lack of transparency in cash handling processes. The report states there is also two weeks of missing bank deposits and poor management practices.

READ ALSO: Penticton Indian Band’s waterline project to enhance health issues

While there are some serious allegations, Baynes said it is not a “witch hunt.”

“Now our focus is to move forward and develop partnerships. I would say any problems that we have had is a lack of leadership and management, so at the end of the day we are pointing fingers back at ourselves,” said Baynes.

The report was recently delivered to the shareholders (chief and council) and to every band member’s residence. The intent is to have full transparency while dispelling any rumours. It also ensures all members are armed with the correct information to move forward and strengthen the band.

“It (the band) hasn’t had opportunities because it has been divided in a lot of ways. If the families got together they could do huge things,” said Baynes.

The report, according to Baynes, is a first step to turning a corner to increased profitability for the various subsidiary companies, and addressing the concerns immediately and introducing changes so it doesn’t happen again.

READ ALSO: Two sides in Penticton Indian Band dispute back in court

Baynes hopes this report will bring transparency to the members as to what is happening with economic development or recent changes. He added there have been “unfounded and destructive rumours” circulating across the PIB.

“There have been a lot of rumours. Don’t believe rumours; you have people who are deliberately, maybe, creating (rumours). There are some crazy rumours. Hopefully, this will dispel them. This is what it is, this is why we are changing and there is no conspiracy or anything else,” said Baynes.

Moving forward immediately is the continuation of work at the Skaha Hills residential development after it had come to a grinding halt around April 2017. K’uL Group has established a construction company that will take over work, with advisory support from Greyback Construction, Lake Excavating and Ecora engineering and environmental consulting. The previous deal only saw the PIB have a 20 per cent share of revenue, now they will receive 100 per cent.

“A two-year pause is not the end of the world from the band’s point of view because now they will make 100 per cent revenue and all the profits on the construction side,” said Baynes.

Born out of the new deal is a K’uL Group led construction company, development company and jobs in leadership positions for band members. Baynes said they are also going to do recruitment drives outside of the band if they cannot fill the positions within their membership.

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