The following is the full text of the February 12 report by the Director of Corporate Services to Council concerning the Trillium Coast account statement turned over to the City by the Tom Thomson Art Foundation. 

Over the last two years, The Tom Thomson Art Gallery Management Board with support from the Tom Thomson Art Foundation (The Foundation) had been moving towards becoming an independent corporation; separate from the City for all legal purposes. Oversight of the Gallery has been under the Management Board since 1999 however at some point more recently that Board determined that additional funding would become available should they become a legally independent entity as well.
In late 2017 it was recognized by the Board of Management that the incorporation business model was not sustainable in its most current form and efforts to incorporate ceased. Since that time it came to light that the Gallery was going to incur a significant deficit. Ultimately Council determined that the management board was not providing the level of oversight required to sustain the gallery. Since that time the Gallery has returned to the status of a City Department and management is under the oversight of City Council with input from a newly elected Advisory Board and City Hall Administration.

Upon returning as a City department, The City Manager, Director of Corporate Services and Art Gallery Office Administrator met with the Chair of the Tom Thomson Art Gallery Foundation. At that time a Trillium Coast ITC account statement was presented to City Staff. The Foundation Chair noted that the Foundation was no longer going to pay any invoices from Trillium Coast and that it would become the City's financial obligation.
Below are the points relating to the website project and outstanding balances owing to Trillium Coast as they are understood by the Director of Corporate Services:
Trillium Coast was engaged by the Director and Chief Curator of the Tom Thomson Art Gallery to develop a website that would support Augmented Reality associated with the Betwixt and Between exhibition.
The Foundation applied for and was awarded a grant to cover the costs of a website for Betwixt and Between. These funds were received and held by the Foundation and have never been transferred to the Tom Thomson Art Gallery accounts held by the City of Owen Sound.
Early on in the development stage of the website the Augmented Reality features and Betwixt and Between aspect was abandoned however it was determined that the new incorporated art gallery would require an enhanced website with online registration and payment capabilities. Trillium Coast continued to be engaged to develop a website under this new scope.
There was no open request for proposal or tender issued for the new engagement scope, nor was there a purchase order issued as would be required under the City's purchasing by-law.
Invoices for the website were issued in the name of the Tom Thomson Art Gallery however all payments were authorized and made by The Foundation from their bank account. No invoice was reviewed or authorized by anyone on City staff other than the Chief Curator who also employed as the only Executive Officer and has signing authority for the Tom Thomson Art Foundation. No payment was made through City accounts.

The Foundation paid website development invoices totalling $58,031.17. Payments ceased from the Foundation in July 2017 at which time two invoices remained outstanding totalling $30,315.08
City staff were not aware of the new website or any of the payments made by the Foundation until the project was complete and after the website went live.
As a City department, the enhanced functionality is not necessary. The website is redundant, monthly hosting is expensive and as such it has been "turned off" in favour of utilizing the City's existing website platform with no additional costs.
Given these points it is the opinion of the Director of Corporate services that since the website is not required with the Gallery operating as a City department and since the Foundation received and paid all invoices leading up to this time, the existing relationship with the website developer is between Trillium Coast and the Tom Thomson Art Foundation.
It is not common practice for the beneficiary of a Foundation to provide financial support back to the benefactor. In addition to that the Gallery is returning to oversight of City Council with a $500,000 deficit incurred under the former Board of Management that must be funded by the tax payer. However in order to maintain that the City operates in good faith with the service providers we deal with and in order to ensure that the vendor Trillium Coast receives payment for services that were performed, the recommendation to Council is that the outstanding balance be paid. In turn an invoice will be issued to The Foundation for the balance from the City directly. Any future support that The Foundation proposes for the benefit of the Tom Thomson Art Gallery will be received if and when the outstanding invoice is paid in full.