The public has no right to see Toronto Hydro’s privatization plans drafted before the public learned of the now-defunct push to sell part of the city-owned utility, Ontario’s Information and Privacy Commissioner has ruled.

In the decision issued earlier this spring, more than two years after the Star first sought the records, the IPC agreed with Toronto Hydro that disclosure of such records would violate its obligations under Ontario’s Securities Act meant to prevent insider trading.

IPC senior adjudicator Frank DeVries ruled that Toronto Hydro, shares of which are owned by the city, and not traded on the stock market, “could reasonably be expected to facilitate the commission of an unlawful act” just by confirming or denying the privatization records exist.

DeVries noted Toronto Hydro, which issues debenture debt at fixed rates that can be resold, is considered a “reporting issuer” by the Ontario Securities Commission.

As such, disclosing privatization deliberations would run afoul of Securities Act provisions against releasing a “material fact or material change with respect to the issuer before the material fact or material change has been generally disclosed.”

DeVries rejected the Star’s arguments that publishing such information is not akin to insider trading, that the public has a right to full disclosure about preparations to sell a city-owned asset, and that Hydro could neutralize insider-trading concerns by releasing the information to everyone, not just the Star, at the same time.

Under the scenario accepted by DeVries, the only way to make the information public would be through an amendment to either the Municipal Freedom of Information and Protection of Privacy Act, which sets out disclosure obligations for agencies including Hydro, or the Securities Act.

City Councillor Gord Perks blasted Toronto Hydro and its board, which includes two of his colleagues, for using public money to fight to keep information from the public.

“Somehow Toronto Hydro has forgotten that they’re owned by Torontonians and need to be accountable to Torontonians,” Perks said. “The fact that we can’t find out how much of our money they spent chasing a dream of privatization, which nobody wanted, is really quite horrifying.”

The Star on Jan. 8, 2016 revealed that senior staff and advisers to Mayor John Tory and senior Toronto Hydro officials initiated financial analysis and research, including polling, on the potential sale of a minority stake in Hydro to help pay for capital needs including Tory’s transit plans.

Tory at the time dismissed the story, saying no privatization plan had been put to him. Later he used a major speech to make the case for partial Toronto Hydro privatization, saying the cash was needed to upgrade Hydro power equipment and the city’s “large-scale projects that are urgently needed.”

The mayor pulled that proposal off the table a month later following a public backlash.

The Star made freedom-of-information requests in January 2016 for Toronto Hydro records of any privatization deliberations and estimated costs of that work including legal and polling consultants.

The Star later revealed two consultants who did privatization-related work for Hydro were also key figures in Tory’s successful 2014 election campaign.

Toronto Hydro has its own legal staff but hired blue-chip Bay Street firm Norton Rose Fulbright Canada to fight the Star request.

Duff Conacher, a co-founder of Democracy Watch who fights government secrecy, called the IPC ruling flawed.

“If Hydro is required to disclose this information under this act, but can’t disclose it without disclosing it generally under the Securities Act, then the order should have been disclose it to the public entirely at the same time as disclosing it to the requester,” he said.

“It’s always a bad idea to create these technical loopholes because others find ways to exploit them more broadly to avoid disclosure.”

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Toronto Hydro is using the same Bay Street law firm to fight other Toronto Star freedom-of-information requests — to find out how much Hydro has spent fighting the Star’s original request.

Brian Buchan, Hydro’s director of media, communications and municipal stakeholder relations, had no comment on the IPC decision on privatization records.

“As you know, Toronto Hydro continues to participate in two active appeals before the Information and Privacy Commissioner in respect of this matter. As such, we do not have any comment at this time,” he wrote in an email.