Since 2020, the B.C. government has offered $30 million yearly in grants to companies able to develop commercial vehicles that produce fewer emissions.
But now, allegations from one of those companies has the government scrambling to explain whether the private accounting firm running the grant program is taking kickbacks.
After days of being questioned over allegations that MNP is being paid to help write grants for the province’s Commercial Vehicle Innovation Challenge (CVIC) and also suggest who should get them, B.C.’s auditor general is investigating.
“We are counting on the auditor general to do a thorough investigation,” said B.C. Premier David Eby in the legislature on Wednesday after once again facing questions from opposition parties over whether public money, meant to mitigate the effects of climate change, is being properly managed.
Where did the controversy come from?
Allegations over grant money mismanagement originated with the Official Opposition, B.C. United, but gained more attention when the CEO of Edison Motors, Chace Barber, came forward to share his Merritt company’s experience in trying to obtain grants under the CVIC program.
His company’s plug-in hybrid semi-truck seemed a lock for funding under CVIC, but was never successful. It had applied for a grant worth $1 million.
Barber provided correspondence to CBC News with an MNP employee and alleged the company offered grant-writing services for a 20 per cent success fee, with payment coming from the grant.
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Chace Barber, CEO and Founder of Merritt-based Edison Motors, raised concerns after his electric truck company was unsuccessful in receiving a provincial clean energy grant. The company’s allegations sparked an auditor general investigation into how grants are awarded.
Barber declined, and said that fee was too high, telling CBC News other companies charge between $5,000 and $15,000 total.
The CEO says he then began to wonder whether there was a connection between MNP offering grant-writing services and the provincial programs it was administering, considering his company’s failure to receive grants while employing other companies to help write them.
“There’s got to be a conflict of interest in there,” he told CBC News on Tuesday.
How has the government and MNP responded?
In its only response so far, MNP wrote in a media statement that “these allegations are false and misleading.”
It said it is not uncommon for firms, like MNP, to provide both grant administration and grant writing services to clients, and that the company had policies and procedures to address potential conflicts of interest.
When it was B.C. United raising concerns, along with other opposition parties, the ruling B.C. NDP mostly shrugged off the allegations last week, refusing calls to for a formal investigation.
But that all changed on Monday when the B.C government ordered the auditor general to investigate the administration of CVIC and another grant program called Advanced Research and Communication.
The minister responsible, Minister of Energy, Mines and Low Carbon Innovation Josie Osborne, said new information had come to light, but did not say what that was.
Minister of Energy, Mines and Low Carbon Innovation Josie Osborne explains why she chose to finally order an investigation into MNP, a company hired to administer clean energy grants, after a trucking firm alleged a conflict of interest in the grant process.
Since then, the government has said little else, other than it is taking action over the matter and is confident the auditor general will get to the bottom of it.
Osborne told CBC News on Wednesday she understands Barber’s frustration over his experience with the CVIC grant process.
She confirmed that Barber did share his concerns with her office at the end of February and that’s when government began to act.
“It’s really important to get to the bottom of this,” she said
For its part, MNP said it “welcomes” the investigation and review.
What is unknown?
The biggest unknown over the allegations is what new information the government received to change its course of action regarding an investigation.
Barber said he met with ministry officials at least a month ago and shared his concerns about the program at that time.
“I don’t think that one had anything to do with me,” said Barber. “I showed all the evidence I already had to the government like a month ago, so I’m curious.”
Osborne confirmed on Wednesday that the investigation was not prompted by Barber’s comments, or those the company made in TikTok videos which were widely viewed over the weekend.
What happens now?
With the launch of a formal investigation by the auditor general, the government can mostly defer pointed questions from the opposition and taxpayers to that process.
There is no indication how long that might take. Auditor General Michael Pickup asked in a letter to the legislature that contacts at MNP be made available, and for his staff to meet with Osborne and her staff, “as soon as possible.”
On Wednesday, the issue continued to dominate question period in the B.C. Legislature, with B.C. United alleging a 20 per cent fee for consultants was pervasive across other government grant programs.
“Our grants are very clear that you cannot use grant money for consultant fees,” said Eby in the legislature. “This is one of the matters that the auditor general will look at, and we look forward to him reporting to the legislature as soon as possible.”
The B.C. Green Party’s Adam Olsen asked the legislature to require other ministries that undertake grant programs to review them to ensure they were meeting all “ethical standards.”