Monday, May 3, 2021 | Category: Eduvation Insider
Good morning, happy Monday, and happy World Press Freedom Day!
This year’s theme is “information as a public good,” and in that spirit I’m going to dedicate today’s issue to what we know so far about the Laurentian U insolvency. (For the entire saga check out my Insider Recap, “Laurentian in Limbo.”) In fact, I stayed up late last night to catch the developments literally “at the eleventh hour…”
Last Thursday and Friday, Laurentian U was in court arguing for an extension of its creditor protection. Meanwhile, thousands of others across Ontario were arguing against its use of CCAA to eviscerate the institution…
Light Against the Darkness
On Friday morning, a “funeral procession” of dozens of vehicles drove through Sudbury to the LU campus, to acknowledge the terminated programs and employees by laying memorial wreaths at the campus sign. Scholars Strike Canada also organized “Rally on Wheels” protests in Toronto, Kitchener-Waterloo, Kingston and Ottawa, to protest “the failure of the Ford government to provide emergency funding… or to stop the use of the CCAA at Laurentian.” Friday night, a socially-distanced “candlelight vigil” was held on the Bridge of Nations, near the home of LU president Robert Haché, “to bear witness to what has happened.” Timmins Daily Press
“The CCAA process was never designed for public institutions. It’s being used to dismantle and destroy the university; to rip up federated agreements; to ignore labour rights; and to dismantle programs that are important to us here in the north. If it can happen at Laurentian, it can happen anywhere else.” – Scott Florence, executive director, Sudbury Workers Education and Advocacy Centre
Faculty Associations Unite
Faculty associations across Ontario are protesting the application of the CCAA to a public institution, and the way in which LU used it to steamroll over bicameral governance and collective agreements. OCUFA reports almost 10,000 letters of support have been sent to the government of Ontario. Faculty associations at Trent, NOSM, Lakehead, Western, Carleton and Nipissing have taken public positions. Faculty associations at Laurier, OCAD, York and Ryerson have passed motions calling for the resignation of minister Ross Romano and senior LU administrators. Senates at Nipissing, uOttawa and U Saint Paul have passed motions calling for adequate funding of francophone PSE from the province and the federal government. OCUFA
Last Wednesday, CAUT called for the resignations of minister Ross Romano, president Robert Haché, board chair Claude Lacroix, and 3 LU administrators over the “calamity” in Sudbury. After CAUT invoked censure against uToronto over a single questionable hiring decision, it’s impossible to imagine that it will not do likewise against LU before long.
Negotiate “in Good Faith”
On Apr 20, the LU Senate passed an almost-unanimous motion urging the administration to “sit down in good faith” with uSudbury and any other federated university to “suggest an orderly transition” of axed programs and faculty members should they wish to adopt them. (5 opposing votes included those cast by president Robert Haché and VP Marie-Josée Berger.) Toronto Star
Jean Watters, former LU president and founding president of Collège Boréal, writes that LU’s program cuts were “non-strategic” and staff dismissals “quasi-Machiavellian.” Black Monday has created bitterness and discouragement in the francophone community, and revived its long-standing dream of creating a truly francophone university, even if “rebuilt on the still-smoking ruins of this university that has never been its own.” La Voix du Nord
The cynic in me has to wonder whether Laurentian’s administration deliberately axed the programs guaranteed to generate the most outrage, and rapidly attract government aid. (I mean, come on! Cutting midwives, francophone and Indigenous programs, legendary environmental departments, and euthanizing hundreds of lab animals…)
Literally Euthanizing Hundreds
In a tragically symbolic move, LU is compounding the termination of hundreds of jobs and scores of academic programs by literally euthanizing 200 lab mice and rats with the closure of its Animal Care Facility. Animal lovers are outraged that no attempt was made to find them “placements” in new homes, and are calling for LU “to immediately stay the wrongful execution of these innocent animals.” Conservation biology grad student Meghan Ward reports that 250 tadpoles in her research lab were killed early, so “there was no research gained from the death.” LU’s statement says simply, “these research activities will be wound down under the oversight of a veterinarian following animal welfare guidelines.”
Just 2 days after a federal NDP critic called for a study into the impacts of cutting LU’s midwifery program last week, the province responded. MCU Ross Romano said Friday that the Ontario government will make it a priority to maintain a northern, bilingual midwifery program, even though LU announced its closure on Apr 13. As a short-term solution, the $1M in funding previously allocated to LU’s program will be redistributed to Ryerson and McMaster, so they can offer “pathways” to LU midwifery students to complete their training without leaving northern Ontario. There has been some speculation that the program could be relocated to the Northern Ontario School of Medicine, which the government plans to make an independent university. Toronto Star
Indigenous advocates are questioning LU’s decision to hire “unqualified” sessionals to teach 6 uSudbury Indigenous Studies courses this spring, rather than hiring the uS experts who developed the courses. LU says it is looking “in house” first for instructors, starting with existing full-time faculty, then LU sessionals with seniority, and then recently-terminated LU faculty. “If no qualified faculty are found,” only then would LU seek applications “externally” from uS faculty. Toronto Star
LU’s legendary departments of environmental science, environmental studies, ecology and restoration biology played a key role in the regreening of Sudbury, and are even singled out in the current research and strategic plans: “Decades of world‐class scholarship on industrial contamination and the recovery of lands, lakes and communities have given the ‘Sudbury story’ global resonance.” So why, asks biology prof Albrecht Schulte-Hostedde, were the programs axed last month, even while LU preserved other money-losing ones because of their “direct link to LU’s mission”? Sudbury Star
Although Women’s, Gender and Sexuality Studies have so far been spared in the LU restructuring, the department worked in tandem with midwifery, social work and Indigenous Studies (which have been cut) and are housed at Thorneloe U, which is in jeopardy (see below). Women’s Studies currently has 53 program students enrolled, and 500+ taking courses towards minors, certificates or electives. “I think right now the administration at Laurentian is having a hard time making the connection between programs that are explicitly about gender equity and what they are actually doing to our community.” Sudbury Star
The abrupt declaration of insolvency, the rush to CCAA creditor protection, and the arbitrary deadline of Apr 30 imposed by a private lender (ostensibly LU’s only option), all created a crisis in which secrecy prevailed, numbers and plans were guarded secrets, and devastating plans had to be approved in mere hours under duress. Staff and faculty unions, and the academic senate, were told they either approve the plan put in front of them, or the university would collapse. This is collective bargaining and collegial self-governance alright – with a loaded gun pointed to the head!
While the unions and Senate acquiesced to this legal bullying, and even Huntington U appears to have “sold” its gerontology program to LU and signed off on the termination of the federation, 2 other founding colleges at Laurentian brought the fight to court last week…
LU: Dissolution or Demise
LU’s lawyer, D.J. Miller, argued in court Thursday that the university would not survive without the planned $10M cash infusion from Firm Capital Mortgage Fund Inc. And for some reason, that loan agreement was amended on Apr 19 to make it almost entirely contingent upon the dissolution of the Laurentian Federation. Miller argued that LU “cannot put forward a viable plan” if it cannot retain the $7.7M in grants and funding that should flow to the partner universities. She warned that if the federated universities win their court challenges, it would lead to LU’s demise – and classes scheduled to begin this morning could not proceed. (Again, a loaded gun to the head.) Judge Geoffrey Morawetz quite rightly asked “Could this timing crisis not have been averted with actions entirely within the power of the applicant?” CBC
“Could this timing crisis not have been averted with actions entirely within the power of the applicant?” – Judge Geoffrey Morawetz, hearing the Thorneloe/LU case
Thorneloe: “Manufactured Crisis”
Andrew Hatnay, legal counsel for Thorneloe U, countered that LU suffered from “plain university mismanagement,” and is exploiting the CCAA process to eliminate a competitor for student enrolment and government grants. “The federation is not a commercial contract.” Furthermore there is no cost to LU of maintaining the federation agreement, and far less gain to terminating it, since the $7.7M is offset by the costs of delivering programs. (In 2020, Thorneloe received just $568K in provincial grants and $1.5M in tuition from LU.) The $30M in savings LU has already achieved through program and payroll cuts should be sufficient to set it on a path to sustainability, he argued. In fact, LU has enough cash on hand to see it through Jun 20. The Apr 30 deadline is a “manufactured crisis,” and court approval of the dissolution of the federation will force Thorneloe into bankruptcy through no fault of its own. Moreover, “if Laurentian does not succeed… neither does Thorneloe.” CBC | Sudbury Star | Radio-Canada
uSudbury: “Tail Wagging the Dog”
On Friday, uSudbury legal counsel Ronald Caza argued that it would be better to let LU “go bankrupt” than allow it to unilaterally and unlawfully “disclaim” the 61-year-old federation agreement. The loan provisions, he said, are a case of “the tail wagging the dog,” and LU’s renunciation of the federation is a mere “cash grab.” (uSudbury is seeking time to restructure, gain degree-granting authority, and reposition itself as an independent francophone university, and seeking to acquire LU’s existing French programs.) Sudbury.com
“We have a university that has asked to put an end to a relationship they have with the federated universities, for the only reason as to choke them out.” – Ronald Caza, legal counsel, uSudbury
Both judges in last week’s court proceedings promised to release their rulings together, literally at the eleventh hour, 11pm last night – barely in time for the start of spring term courses today at LU. (Also not great for my own editorial deadline.) They were faced with an ultimatum from LU: dissolve the federation so that we can access our next $10M loan instalment, or (implicitly) we bankrupt the university and throw students out of classes without warning.
Late last night, the judges released their rulings, dismissing the motions of the federated universities and finding in favour of LU’s administration and their insolvency advisors, Ernst & Young. Justice Gilmoreconcluded that uS “brought up many important issues in its request… all of which this court intends to address,” but “in the interim… I have determined to dismiss SU’s motion. Detailed reasons will follow.” Chief Justice Morawetz concluded “for reasons to follow, Thorneloe’s motion is dismissed.” In his ruling on LU’s CCAA extension, he concluded “for reasons to follow, this motion is granted.”
After a weekend of deliberations, the judges invalidated 61 years of history, 3 affiliated colleges, and vital connections to the Indigenous and Francophone communities of northern Ontario. All for the lack of $10M, if the administration is to be believed, that it supposedly needed by this morning in order to avoid declaring bankruptcy. (Personally, I think LU should face bankruptcy over this, not push its federated colleges there to save itself.) Of course, things should never have come to this…
Critics have already observed that the LU administration has been “insulting our intelligence” by suggesting that it had no other options for emergency financing than “debtor-in-possession” financing from Firm Capital Mortgage Fund, and clearly there were other options…
City Council calls on MCU
Last week, Sudbury City Council unanimously called on the province “to intervene in this ongoing process as soon as possible and commit to providing the much-needed funding to secure the future viability and sustainability” of LU. Beyond hundreds of jobs and thousands of current and future students, many contractors may be pushed out of business if LU cannot pay its debts. “We are devastated by what is happening at our institution.” Sudbury Star
RSC Urges Federal Aid
In its March policy paper, the Royal Society of Canada observes that provincial governments appear to be detaching from the purpose of PSE, and urges the federal government to take on a greater role to advance research, integration, equity and inclusion, by increasing core funding to PSE institutions. The “nightmare scenario” at LU is a “canary in the coal mine.” University Affairs
Ottawa Offers Help
Last Thursday, federal official languages minister Mélanie Joly said Ottawa is willing to provide funds to assist LU, and is in discussions with the Ontario government about how best to support francophone PSE. “We are at the table and we are willing to help.” (The latest federal budget committed $120M over 3 years to minority-language PSE across Canada.) She envisions 3 possible futures for francophone PSE in Sudbury: either in a bilingual LU, a monolingual uS, or through a satellite of Université de l’Ontario Français. Joly also said the CCAA process was never intended for public institutions. In fact, Sudbury MP Paul Lefebvre recently introduced a private member’s bill to forbid it. Globe & Mail
On Apr 12, the federal government announced a $5.4B loan to Air Canada, to preserve the 14,859 employees it had left (out of 38,000 pre-pandemic). That is a loan of $363,416 per job. Last week, Ottawa also offered Air Transat a $700M loan to preserve 772 jobs (out of 5,000 pre-pandemic). That works out to $906,736 per job. Sure, there were creditors to be repaid and customers to reimburse, and airlines serve an important role in the sustainability of smaller communities across Canada – but so, quite obviously, do the universities in the Laurentian Federation! And there is little doubt that the travel sector will have a very long road ahead to recovery from the pandemic recession. (Full disclosure: I’m a frequent flyer who genuinely resents Air Canada’s monopolistic pricing and ill treatment of employees and customers alike.) Based on the going Air Transat rate, you would think that Ottawa would gladly front a loan of $181M to save 200 jobs at LU, or even $29M merely to save the 32 jobs at Thorneloe – without Firm Capital’s draconian terms, and likely at a near-zero interest rate.
Based on the going Air Transat rate, Ottawa should gladly loan Laurentian $181M to save 200 jobs, or $29M merely to save 32 jobs at Thorneloe.
Did Ontario Offer Too?
Perhaps I’m too big a fan of police procedurals and courtroom drama, but the other “smoking gun” in Laurentian’s insolvency might well be the secret correspondence between the LU administration and MCU in late January, just 5 days before the CCAA action was announced. The CCAA judge ordered the correspondence sealed because its contents could be “detrimental to any potential restructuring.” I can only imagine why that might be, but it certainly would make sense if in fact MCU offered emergency financing to LU, and the administration refused to take it. Presumably the correspondence somehow entangled the provincial government in the matter, or relieved LU of its “manufactured crisis.”
Next we turn our attention to what lies ahead…
A Path Forward?
At a Friday afternoon meeting, the LU board of governors terminated the Retiree Health Benefit Plan and Supplemental Retirement Plan, effective Apr 7. LUSU president Tom Fenske urged the board to follow in the footsteps of chancellor Steve Paikin and resign: “This catastrophic event was started by this board,” he said. President Robert Haché offered a more “rosy” perspective, telling the board that the “worst of the CCAA process” is behind them: “3 months ago we were in a very precarious position. Today there is a light, there is a path forward.” Sudbury.com
As you can probably tell, I don’t share president Haché’s optimism. Stay tuned: tomorrow we’ll look at the future for Laurentian and its federated colleges in more depth.
If you really want a video in keeping with the LU theme today, you can watch alumnus John Closs deliver a Si Kahn cover/protest song he calls “Ivory Towers.”
But for those of you who would like to watch a particularly good university commercial instead…
Greenwich U (UK) released a 1-min spot on Friday largely shot in a time of social distancing, but energized with a funky soundtrack and dynamic transitions, and defying the victim mentality: “We are not Generation Covid. We are Generation Greenwich. We will bounce back.” YouTube
As always, thanks for reading! Please do drop me a line if you spot something interesting, thought-provoking or cool happening on your campus, or elsewhere in the world!
Stay safe and be well – and for those of you in Sudbury, stay strong!
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