South West Shore Development Agency closes down in Yarmouth.

Friday June 11 was the last day of operation for the South West Shore Development Agency, or SWSDA. Mired in controversy and unable to account for nearly $500,000, the agency lost the confidence of the province, SWSDA's largest financial contributor. The agency shared offices with the Yarmouth and Area Industrial Commission, which runs the port and ferry terminal, and CEO Frank Anderson headed both organizations.

An audit ordered by the province in February and conducted by Ernst and Young criticised the board's competence and cited the lack of experience and proper information to run the RDA efficiently.

The audit and subsequent inability to account for $500,000 is a major story in the by-election currently underway in Yarmouth. Green Party Leader and candidate John Percy said that the financial discrepancies could not have come at a worse time, given the large economic hit the area has taken with the closure of the ferry. "Rebuilding the economy of the region is of paramount importance, and perhaps we have come to realize that the old boys network is not the organization we need to run the new economy."

A report by Nova Scotia Ombudsman Dwight Bishop was critical of dual CEO Frank Anderson. Mr. Anderson is paid by both organizations but, Bishop said, that even after careful examination, he was not able to assess how much Anderson is paid.

The report also indicates nearly $1 million in loans were made from the Yarmouth Industrial Commission to the authority between 2004 and 2007. In one case, a loan was issued because the authority "had a cash flow issue."

The Ombudsman said it was unclear if any or all of that the money was repaid or exactly what it was used for.