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THE CORPORATION OF THE TOWN OF NEWCASTLE
REPORT
Meeting: General Purpose and Administration Committee
:~s# }J);J-7Jj::~3
By-Law #
Date: June 7 1993
Report #: ~nMTN _ 'i-He #:
Subject:
Legal Services for the Town
Recommendations:
It is respectfully recommended that the General Purpose and
Administration Committee recommend to Council the following:
1. That Report ADMIN. 5 - 93 be received for information.
1. INTRODUCTION:
1.1 During budget deliberations this year, Council requested that
the legal functions of the Municipality be reviewed from the
perspective of any functions presently undertaken that could
be tendered to legal firms within the Town or the Region of
Durham.
1.2 The discussions also focussed on the aspect of cost related to
the Town's legal services. It is the purpose of this report
to address these matters.
2 . BACKGROUND:
2.1 Over the recent past the Municipality has required a greater
emphasis on the use of legal services. This has been a result
of the significant issues the Town has and will continue to
face which require legal input. These are related to such
matters as landfill, Ontario Hydro including the
implementation of the Community Impact Agreement with the Town
with respect to the Darlington Nuclear Generating Station
regarding building permit fees and other matters, changes in
Provincial legislation, the planning process, by-law review
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ADMIN. 5 - 93
2
and update, improvements
increased litigation, the
beyond the Town's control.
in the land disposal policy,
name change, and various appeals
2.2 The Municipality has responded to these needs by engaging
Municipal experts in this field through the services of
Dennis Hefferon of the firm Shibley Righton. This approach
has resulted in long term cost savings through economies of
scale, the minimization of risk and liability to the Town
through a high quality service and the achievement of
excellent cost-effective results for the Town.
2.3 Accordingly the Municipality has moved in this direction to
gain these advantages and facilitate administrative control.
3.0 COSTS AND ISSUES:
3.1 The costs related to the Town's legal services have been
directly related to the volume and scale of issues facing the
Municipality. Attachment #1 outlines specifically the cost of
legal services by type for the years 1991, 1992 and 1993 to
date.
3.2 In this regard, the cost for each year is provided on the
following basis:
a) Budget - An amount approved annually through the budget
process which includes departmental and administrative issues
of an ongoing nature.
b) Specific or one time issues - Many of these issues are
funded by special resolution of Council and may include issues
of a one time nature for which normal budgetary approval was
not anticipated.
c) 100% Recoverable - These costs relate to work related to
the preparation of subdivision agreements and are billed to
the proponents for 100% of the cost.
It should be noted that all costs are presented in this
attachment as gross expenditures. However, costs related to
category c) are 100% recoverable and some of those in category
j : .2 1
ADMIN. 5 - 93
3
b) have been or will be recovered over a period of time.
Also, it should be noted that in anyone year, costs in
category c) may not be recovered by the year end at December
31, and therefore would appear as a cost or a recoverable in
the following year.
3.3 It should be noted that through the legal services provided to
the Municipality by the firm of Shibley Righton, positive
gains have resulted to the Town, both financially, in
relationship to revenue received and reduced risk of future
economic loss, and with respect to the reduction of future
operating liability and risk. Specifically the following
issues are very important in this respect for the Town:
. Mosport Park: Proposed rock concert - As a result of the
way the Special Events by-law had been previously drafted
this issue escalated to a level which could have resulted
in an extraordinary amount of financial and insurance
related damages to the Municipality. As a result of the
involvement of Mr. Hefferon, the Municipality was spared
a great deal of expense, and the potential expense and
liability of any future exposure that otherwise might
result if rock concerts are allowed to proceed on these
or other premises within the Town.
. Port Granby Waste Management Facility - This has been an
ongoing issue over the past several years. It has cost
the Municipality significantly in monetary terms and
environmental impacts. However, as a result of Mr.
Hefferon's expertise and his diligence in attendance at
the A.E.C.B. hearings to deal with this extremely
important and complex issue, the threat to the
Municipality has been reduced. The Municipality must
continue to be persistent in this matter until completely
resolved to the Town's satisfaction.
. Laidlaw/IWA - This is another significant issue to the
Municipality, both monetarily and environmentally. On an
I ; 22
ADMIN. 5 - 93
4
ongoing basis, the Municipality's legal rights have been
protected through Mr. Hefferon's legal expertise and
diligence. Also, the involvement and expertise of the
Town's solicitor has proven beneficial in securing
$75,000 from the Participant Funding Program to deal with
the issue, while at the same time reducing the overall
risk.
. Ontario Hydro - The achievements resulting from the
Community Impact Agreement in September 1989 and the
interim settlement of the building permit fees, to the
extent of $1,200,000, are significant to the financial
and overall well being of the Town. This can also be
said about the current ongoing discussions which are
aimed at achieving the best financial package for the
Municipality and the ability to have an ongoing positive
working relationship with one of our largest
Corporations.
. Subdivision Activity - Inadequate provl.sl.ons to protect
the financial security of the Municipality with respect
to the subdivider's obligations to the Town have been
rectified through the newly drafted individual
subdivision and core agreements. In this regard, the
Municipality has been able to safeguard it's interests.
As well, the Municipality has realized significant monies
from the sale of road allowances to subdividers.
3.4 The fee schedule related to the costs identified in the
Attachment to this report is provided under separate cover.
Council will realize that these rates are more than
competitive and have remained at the same level since 1991.
In addition, these rates include a substantial discount for
the Town's benefit. The rates, however, need not be
discounted for recoverable costs related to work of a legal
nature performed on subdivision agreements.
25
ADMIN. 5 - 93
5
3.5 The potential monies recoverable from those costs identified
in section b) of the Attachment, including outstanding matters
related to Ontario Hydro, Challenger Park Subdivision
Agreement, various By-Law Enforcement matters, and the
election claim against the Town, just to name a few, will be
received on an ongoing basis as the individual issues are
resolved. This will result in a reduction in the overall cost
to the Municipality. In addition, specific resolutions of the
previous Councils have provided funding for some of these same
issues, for example, the Dineen Construction delay claim
related to the Municipal Administrative Centre, Ontario Hydro,
Port Granby decommissioning, and the Laidlaw/Interim Waste
Authority matters.
3.6 It should be noted that the legal work during the periods
covered in Attachment #1 have taken place during a peak in
activity related to development applications, subdivision
approvals and the preparation and implementation of the Town's
Development Charge By-Law. These additional costs have been
imposed on the Municipality due to changes beyond our control
in provincial legislation and as a result of matters not
initiated by the Municipality.
4.0 THE LEGAL FUNCTIONS:
4.1 The current practice of fulfilling the legal functions of the
Municipality has gained a number of advantages as indicated in
Sections 2.2 and 2.3 above. More specifically the functions
have been retained with one firm through which administrative
efficiencies in cost control have served the Town and the
public well.
4.2 This approach has provided not only an excellent service to
the Municipality but also services of an indisputable
professional quality and very positive results for the Town.
In addition, this approach has avoided various conflicts of
interest in providing independent legal advice on many
critical issues.
')4
ADMIN. 5 - 93
6
4.3 The value of the service received by the Municipality also
takes advantage of the fact that the legal services are
concentrated in one firm, and has as a result a better
knowledge of the uniqueness and history of the Municipality.
Inherent in this are the economies of scale mentioned
previously which would otherwise not be achieved, in addition
to the provision of casual advice at no cost to the
Municipality.
4.4 The availabili ty of the legal resources of the firm has
allowed the Municipality to benefit from the efficiencies and
expertise available within that organization without the
related loss of efficiency and additional costs that would be
incurred if the Town employed an in-house lawyer and staff, or
if the provision of legal services was fragmented among two or
more firms.
4.5 The expertise of the firm of Shibley Righton in the municipal
field has served to protect the interests of the Municipality,
as well as the officers and officials of the Corporation, on
significant legal issues. As a result, it should be noted
that the Municipality has been spared significant expenditures
and has been successful in the substantial recovery of costs.
5.0 FINAL COMMENTS:
5.1 The above review, in accordance with Council's request
regarding the legal services for the Town, indicates that the
Town's needs are presently being well served with the services
provided by Dennis Hefferon and the firm of Shibley Righton.
As such, a change in approach is not recommended and could, in
fact, prove to be more costly to the Town.
Respectfully submitted,
't---
I f
~lLill(lL ( L {~
Lawrence E. K t
Chief Administr
Officer
att.
, ') i~
A
A
A
A
A
A
A
E X PEN S E S
B
B
B
B
B
B-1
B-1
LEGAL
BUDGET RELATED EXPENSES
By-Law
~::::~~~:~_::~:~--~:~~~--~~~~:~~~~~~---~~~~-~~~~~~~!~~-~~~!~:~----~:~~~;!-
3,000 500 300 15,700 6,000 67,000 90,000 182,500
....O....ji4.....0..4;jij...i;06B....ij;i69...is;6i4......jS;SBB.
o 0 0 1,297 4,393 8,973 5,915 20,578
o 0 0 0 0 3,766 1,676 5,442
o 0 0 161 0 0 234 394
o 0 0 0 0 6,264 7,088 13,352
o 271 0 1,412 0 945 19,390 22,017
o 0 0 2,194 0 4,696 7,988 14,878
o 0 0 0 215 6,796 0 7,011
o 0 0 1,903 0 0 0 1,903
897 0 0 0 0 14,065 13,915 28,878
o 0 0 3,834 0 375 4,574 8,783
o 0 0 1,726 0 6,425 0 8,150
-----------------------------------------------------------------
897 595 0 16,838 6,677 65,572 76,395 166,973
=================================================================
BUdget1991
January
February
March
April
May
June
July
August
September
October
November
December
TOTAL 1991
Budget
1992
January
February
March
April
May
June
July
August
~~~~=er
November
December
150,000
....O....740.....o..j;i67...i;ii4.....6;SOj....7;666......i9;i90.
o 0 0 491 0 0 4,845 5,336
o 1,483 0 5,083 0 6,917 3,322 16,804
o 0 0 0 0 1,200 0 1,200
o 4,010 0 11,321 0 15,461 16,583 47,375
343 1,603 0 2,582 0 21,255 4,395 30,179
o 0 0 22,725 364 9,059 579 32,727
4,716 0 0 11,051 1,153 5,556 3,113 25,589
4,718 0 0 4,213 0 16,712 0 25,644
o 0 0 1,756 0 642 17,868 20,266
o 0 0 2,411 0 23,256 8,452 34,119
0000000 0
TOTAL 1992 ;~~~~==~~~;~=====~=~~~~~~===~~~;;===;~~~;~~===~~~~~;=====~;~~~~;=
-----------------------------------------------------------------
BUdget1993
January
February
March
TOTAL 1993
NOTES:
200,000
....O..i;06i.....o..i;i69.......0.....j;796....i;47j.......9;S99.
o 7,694 0 6,771 0 1,826 8,065 24,356
o 1,432 0 0 0 0 0 1,432
-----------------------------------------------------------------
====~=;~~;~~=====~==;~~~~=======~=====;~~~~===;~~;;~======;;~;~~=
[1]
[2]
[3]
[4]
[5]
,
RESOLUTION RELATED / ONE TIME ISSUES
Admin. Total
Devel. Pt.Darl.Election Mosport Centre Ontario Waste/ Town
Chg.By-l Harbour (Dineen) Hydro Laidlaw Expenses
-----------------------------------------------------------------------
15,000 15,000 30,000
......O...i;44i.......o...i;S4B.......o...ii;677...iB;976.......4S;644.
o 0 0 923 0 0 2,556 3,480
8 3,77~ 8 8 1,618 3,12~ 3,39g 11,90~
7,116 1,752 0 2,602 0 0 0 11,469
5,452 494 0 0 0 24,257 1,888 32,092
4,419 0 0 0 0 2,653 0 7,072
o 0 0 0 0 3,431 4,077 7,508
o 000 0 0 0 0
16,864 0 0 0 7,092 8,132 1,469 33,557
4,503 0 0 350 0 0 538 5,391
o 0 30,427 0 0 0 0 30,427
-38;352---8;460--30;427---6;424---8;702---53;272---42;903-:----188;541-
=====================================================:::::.::=:===:===~
10,000 10,000
.i4;i6j.......O...4;B9S.......o...i;467....B;Bii....j;Bis.......jj;i6i.
9,384 15,440 0 2,939 0 0 0 27,763
12,128 0 0 0 0 0 7,808 19,937
o 0 0 0 0 2,841 13,917 16,758
o 0 0 1,782 0 0 1,486 3,268
o 0 0 0 0 764 8,487 9,251
o 0 0 0 0 10,617 0 10,617
o 0 0 4,661 0 2,408 7,447 14,516
o 797 0 0 18,899 3,027 2,411 25,134
803 0 19,406 O' 0 1,205. 2,814 24,228
3,115 0 0 0 0 '2,667 462 6,283
o 000 0 0 0 0
---------------------------------------------------------- ------------
_=3~!~~~--!~!~~~--~~=,=3=0!-=-~!~~~--~~!=3=6~--=~~!~~~=-=~~!~~~-:--=-=1-9=1!~!~-
- ----------------- -- ----------- --- ------ - ------- -- - -----
10,000 10,000 . 20,000
......O.......O.......o...i;i6B.......o....i;oii....4;7ji.:......B;oii.
o 2,989 289 0 0 2,746 7,958. 13,982
o 0 000 0 0 . 0
---------------------------------------------------------- ------------
o 2,969 289 2,266 0 3,758 12,690: 21,993
=:::=::=:=:==c==s:=::==:c=::=::====:==::cc=:::cc::c=======.========:===
[1]
[2]
[3]
[4]
SUBDIVISION RELATED
C
Total
100 \ Legal
Recoverable Expenses
212,500
.....7;i97....BB;si8.
2,011 26,069
8 17,~~~
o 24,822
34,089 88,198
o 21,949
804 15 323
35,917 37~820
103,061 165,496
42,010 56,183
o 38,577
---------------------
225,190 580,703
==============:======
160,000
....sj;o7j...ios;si4.
2,170 35,269
9,126 45,867
10,051 28,009
2,538 53,181
1,216 40,646
4,369 47,713
2,002 42,106
5,870 56,648
4,472 48,967
530 40,931
4,720 4,~20
---------------------
100,136 549,580
.===========~========
220,000
....i9;70j....j7;ji4.
22,148 60,485
o 1,432
---------------------
====~;~~;~====;~~~;;=
[5]
Attachment * 1 to Admin.5-93
1991 Legal Issues - Summary
A Budget Related Issues
B Resolution Related
B-1 Resolution/continuing
Total Town Costs
C SUbdivision/Recoverable *
Total Legal Expenses
166,973
92,366
96,175
-----------
355,514
225,190
-----------
580,703
==:========
* 1991 Development Charge By-law created
extraordinary level of subdivision
agreements and revisions.
1992 Legal Issues - Summary
A Budget Related Issues
B Resolution Related
E-1 Resolution/continuing
Total Town Costs
C Subdivision/Recoverable *
Total Legal Expenses
** Development Charge by-law passed
March 1992.
1993 Legal Issues - Summary
A Budget Related Issues
D Resolution Related
B-1 Resolution/continuing
Total Town Costs
C Subdivision/Recoverable
Total Legal Expenses
258,429
109,978
81,037
-----------
449,445
100,136
-----------
549,560
==========:
'-t:'
N
possible recovery on the Election Appeal of $11,156 inclusive of GST.
Dineen Delay Claim - Reserve allocation of $550,000 in 1990.
Ontario Hydro Arbitration costs recoverable through 1977
agreement plus an allocation of $150,000 to Reserve in 1989.
Laidlaw/Waste/IWA funding available from $60,000 per resolution
Feb.1990 plus IWA participant funding of $75,000 in 1993.
Subdivision costs are 100\ recoverable and may be collected
in the following year.
;;"-.,,.
.- -
35,387
5,545
16,446
-----------
57,380
41,851
-----------
99,231
===::===c=: