JACK LAKEY

November 26, 1994

Computer equipment being used by an embattled Metro union to train laid-off members has been repossessed because it refused to pay the bill.

Workers spent yesterday carrying computers and equipment out of Labourers' International Union of North America, Local 183, after the union failed to make a scheduled $77,000 payment this week.

Euro Digital Systems of North York contracted with Local 183 last month to provide 27 computers, related technology and two certified instructors to train 200 laid-off workers in computer skills.

But all government funding to Local 183 was cut off after The Star revealed the union's employees renovated the house of a federal bureaucrat who helped Local 183 obtain $ 1.6 million in grants for its training centre.

Italo Sabato, vice-president of Euro Digital, said union officials told him they no longer had the money to pay him because federal and provincial funding to Local 183 is on hold.

Sabato said he still owes a lot of money for the equipment he purchased to provide the computer training, and doesn't care if the government cut off the union's funding.

"My contract is with Local 183, not with their training centre or the government," Sabato said. "I have suppliers who are very edgy and want to know what's going on.

"If they don't pay me I'm stuck with the equipment. I'll have to sell it and take a loss. If I had any idea that they were in this kind of trouble, I would never have got into this deal with them."

Local 183 and Eric Ferguson, a federal manager of training services, are under investigation by Metro police fraud detectives for the renovations and how the union spent the $ 1.6 million in grants.

The union paid about $1 million of the money to a computer college for a training deal last year. Questions have been raised over the real value of the services.

OCT. 31 DEADLINE

Edward Thornton, who acts as Local 183's spokesperson when The Star calls, was unavailable for comment until Monday, said a training centre staffer.

Sabato, who has done business with Local 183 for five years, said he was asked last month by training centre administrator John Colacci to bid on a contract to provide computers and instructors to train 200 people.

But according to Sabato, he was told by Colacci the computers had to be in place and the course up and running by Oct. 31, which gave his staff only a few days to hire instructors, acquire equipment and plan the training.

"They were really rushing this and I couldn't figure out what the big hurry was," he recalled. "But I'd done business with them before and they were reputable, so I didn't worry too much."

Local 183 agreed to pay Euro Digital $ 335,000 for the training, to take place over a five- month period, but the first payment of $ 80,000, which was due Oct. 24, wasn't made by the union until Nov. 4.

A second payment for $ 77,000 was due Thursday, and would have been used to clear outstanding balances with businesses that supplied equipment for the training, Sabato said.

But union officials contacted Euro Digital earlier this week, Sabato said, and asked to renegotiate the deal, saying they were having financial trouble.

"I was willing to listen to them, but I told them I had kept my end of the bargain up to that point, and they should keep theirs," he said. "I told them I needed the $ 77,000 and without it, there wasn't much to talk about."

By Thursday night, Sabato said it was clear that Local 183 wouldn't pay, so he made arrangements to have his equipment removed yesterday.