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HomeMy WebLinkAboutADMIN-5-92 -i .. THE CORPORATION OF THE TOWN OF NEWCASTLE REPORT Meeting: Ge neral Purpose and Administration Conmi ttee Date: May 4 1992 File # LII. .J73?l.. Hu Res, #1"., fji~:; ,f,. '- ~) By-Law # Report #: ADMIN.5 - 92 File #: Subject: Municipal Conflict of Interest and Open Local Government Legislation Recommendations: It is respectfully recommended that the General Purpose and Administration Committee recommend to Council the following: 1. THAT Report ADMIN 5 -92 be received. 2. THAT Council supports the recommendation of the City of Etobicoke contained in Attachment #2 to this Report and that the City of Etobicoke be so advised. 3. TIiA T the proposed legislation should be amended to assign a dollar value to the terms "remote" and "insignificant" used in Section;2{{)(of the Act. q~) 4. THAT the proposed legislation should continue the Court's power to relieve a member from the consequence of a breach of it in cases of bona fide error or inadvertence. 5. THAT the proposed legislation should require the Ministry of Mun.icipal Affairs to establish an advisory service availahle free of charge to members of councils to 'I 1 (j 1 t i ',) . " '! - 2 - provide advice as to the interpretation of the Act ami whether the disclosure and abstention requirements of the Act apply in the particular circumstances. 6. THAT the proposed legislation should be amended to provide that a member relying on the advice given by the Ministry's advisory service should be deemed not to violate the Act if the advice is followed in good faith. 7. TIIA T the Declaration of Elected Office provided in the proposed legislation should be amended to delete the statement that the official concerned understands the Act. 8. THAT a copy of this Report be forwarded to the Honourable Dave Cooke, Minister of Municipal Affairs al\ the Town's position regarding the proposed new legislation. 9. THAT all of the above recommendations be approved FORTHWITH. 1 (~r) ! .j i. ~ - 3 . ].0 Introductiotl 1.1 By memorandum dated April 27, 1992 1 forwarded to you for your information a copy of the Ministry of Municipal Affairs. Report entitled "0pen Local Government'" The document contains proposals (1) to amend the Municipal Conflict of Interest Act and the Municipal Act to implement the Report of the Municipal Conflict of Interest Consultation Committee (the "Consultation Conunittee") dated July, 1991; (2) to amend the Municipal Act to require meetings of councils and committees to be public; and (3) to amend the Municipal Act to establish new rules respecting the sale of real propeny by municipalities and local boards. 1.2 The Report of the Consultation COlwnittee was considered in Report #ADMIN 7 - 91 addressed to the General Purpose and Administration Committee. Council approved the recommendations contained in it and subsequently these were forwarded to the Minister of Municipal Affairs. A copy of Report #ADMIN 7 - 91 is contained in Attachment # 1 to this Report for your information. 1.3 It should be noted that Report #ADMIN 7 - 91 did not cOILliider the proposed amendments to the Municipal Act contained in "0pen Local Goverrunentll which require public council at committee meetings and the sale of real property by municipalities. These subjects were not addressed by the Consultation Committee. The proposed amendments are considered in sections 4 and 5 of this Report. 2.0 City of Etobicoke's Submjssions on "Open Local Governmenf 2.1 At the meeting of Council on April 13. 1992. Council referred correspondence dated March 26, 1992 from Cathie Best, City Clerk. City of Btobicoke regarding proposed amendments to the Municipal Conflict of Interest Act to staff for review and preparation of a report to Council. A copy of Ms. Best's letter is contained as Attachment #2 to this Report. (~ --- I . ! ~ , \) J 'i .. 4 .. 2.2 The City of Etobicoke rejected the necessity for the new legislation proposed in "Open Local Government" dealing with municipal conflict of interests. It submitted amendments to the existing legislation for the Ministry's consideration. If the Minister did not accept the recommendation that the existing legislation be retained, and the Minister determines to proceed with the proposed legislation in the alternative the City submitted a number of amendments to the proposed legislation for the Ministry's consideration. 2.3 Council should support the recommendations of the City of Etobicoke. They include the recommendation that the Municipal Conflict of Interest Act should continue to permit a judge to excuse a member from the consequences of a breach of the Municipal Conflict of Interest Act in cases of bona fide error or inadvertence. The provisions of the existing legislation and the significance of the bona fide error or inadvertence ground for excusing a member from the consequences of breaches of the Act are discussed in Section 3 of the Report contained in Attachment #1, and in particular, in Recommendation (3) and paragraphs 3.1.5 to 3.1.9 of that Report. 3.0 Other Recommendations respectini Proposed Chanees to the Municipal Conflict Df lnterest Act 3.1 The provisions of the existing Municipal Conflict of Interest Act as interpreted by the Courts are discussed in Section 2 of the Report contained in Attachment #1. Crucial to the Ministry's proposed new legislation is the new definition of the term "pecuniary interest". Section 2 of the proposed legislation provides that "pecuniary interest" means Itan interest consisting of measured in or related to money". 3.2 The duty of a member prescribed by Section 5 of the proposed legislation is that where he or she either on his or her own behalf or while acting for. by, or with or through another person, has any pecuniary interest in a matter which is a subject of consideration at a meeting of the council or local board, the member, if present shall prior to any consideration of the matter at the meeting orally disclose the interest "I ('\! Ll t U r ....' j I .l. "-' .. '-. :.1 -, .\ . 1 . 5 - and its general nature and complete and file in the prescribed form a written disclosure of the interest and its general nature with the clerk of the municipality or secretary of the local board. The member who has a pecuniary interest is prohibited from participating in the discussion of or vote on question in respect of the matter, and from attempting to influence the employees of the council or the local board. If absent from the meeting at which the matter is considered, the member in question is required to disclose the interest at the next meeting of the council or local board that the member attends. The proposed legislation goes on to provide rules concerning the recording of oral declarations of interest and its general nature, the completion of a written disclosure form and the keeping of a central register of disclosure by the clerk of the municipality or secretary of the local board. (SectioIl.1\ 16 and 17). 3.3 A contravention of the legislation is to be tried and determined by a judge of the Ontario Court (General Division) (Section 9). Provision is also made in the proposed legislation for the appointing of a Commissioner who has power to investigate alleged contravention of the legislation, and in appropriate cases to apply to a judge for determination of a question as to whether the member has contravened Section 5 (dealing with the declaration of pecuniary interest), Section 7 (dealing with disclosure of gifts) or Section 8 (dealing with disclosure of assets). The Commissioner's investigation may also be initiated where a member fails to make a declaration of a pecuniary interest in any matter which is the subject of consideration of a meeting of an advisory body to which the member has been appointed by a council or a local board. (Section 6). The proposed legislation authorized a judge to impose relatively severe penalties for breach of its requirements. (Section 11). 3.4 As was noted in Section 3.1.3 of the Report contained in Attachment #]. as interpreted by the Courts the term "pecuniary interest" applies to any situation of actual or potential financial profit or loss as well as to the maintenance of the members' existing financial position. The determination of whether there is a n L- uJ " 3.5 3.6 3.7 3.8 - 6 - potential for monetary profit or loss can be extraordinarily difficult in particular circunu;tances. The existing Act provides no assistance to the member concerned in making this determination. The member is left to make this determination himself or herself although the result of an incorrect decision is that the Act may have been breached with serious legal consequences to the member. L;1o) Section ~ of the proposed legislation saves members from the requirement of disclosure of a pecuniary interest and compliance with Section 5 if the interest lIis so remote or insignificant in its nature that it could reasonably be regarded as likely to influence that person". In practice. a determination whether the saving provision applies wj]} be difficult and hazardous to make in many circumstances. In paragraph 3.1.8 of the Report contained in Attachment #1, it was recommended that the Act be amended to assign a dollar value to the term "remote or insignificant" in order to assist a member in making a correct judgement as to whether he or she has a "pecuniary interest" in a matter which is considered by a council. Although this recommendation was not adopted by the Minister, in light of its importance Council should repeat it. Council should recommend that the proposed legislation be amended to assign a dollar value to the terms "remote" and lIinsignificantlt a.~ set out in Section.2(6(of it. Lf{o) As is noted in Paragraph 3.1.9 of the Report contained in Attachment #1, the hazard that individual members of Council will make an incorrect judgement on the question of remoteness or insignificance and incur penalties under tbe proposed legislation underlines the importance of the recommendation made above in Section 2.3 of this Report that the Court should retain authority to relieve a member from the consequences of breach of the proposed Act where the breach has resulted from a bona fide error or inadvertence. Council should also repeat Recommendations 4 amI 5 of the Report contained in Attachment # 1. Council should recommend that the proposed legislation should (j b " <, - 7 - require the Ministry to establish an advisory service available free of charge to members of councils to provide advice as to the interpretation of the Act and whether the disclosure and abstention requirements of the Act apply in the particular circumstances. Council should also recommend that the Act be amended to provide that a member relying on the advice given by the Ministry's advisory service should be deemed not to violate the Act if the advice is followed in good faith. Further, Council should reconunend that the Declaration of Elected Official (set out on page 29 of "Open Local Goverrnnent") be amended to delete the statement that the official concerned not only has read and agrees to comply with the Act but also "understands" it. An understanding of the Act requires an understanding of the applicable law. It is unfair to require an official who is not a lawyer to take such a declaration. 3.9 In the definition of "collllnunity of interest in common with ejectors generally" contained in Section 2 of the proposed legislation, the Minister appears to have adopted recommendation 16 of the Town's Report contained in Attachment #1 dealing with the subject of "community of interest". The exemption from the requirement of declaration of a pecuniary interest will be avaHable where the member hal\ a pecuniary interest in common with the electors within the Town as a whole or if the matter under consideration affects only part of the Town in common with the electors within that part. This corrects a serious deficiency in the recommendations of the Consultation Committee. 4.0 ~blic Meetini of Council and Committees 4.1 The Municipal Act currently provides that meetings of municipal councils are to be open to the public, except that meetings of committees of council and special meetings may be closed at council's discretion. The proposed amendments to the Municipal Act would require that regular. special or committee meetings of councils be open to the public except that meetings to consider certain limited topics including litigation. security, property acquisition and negotiation and meetings to 1,--,-/ ! ;~j ~ .8- discuss matters that must not be disclosed under the Municipal Freedom of Information and Protection of Privacy Act. may be held in camera. Further. the proposed amendments would permit the Minister to make regulations prescribing standards for the calling, place and proceedings of meetings of councils and local boards and the conduct of members which would supersede a municipality's procedure by-law if the regulations were more stringent. 4.2 The proposal is that the list of matters that may be dealt with by a council or a committee in camera is to be limited and closed. The list does not include for example, consideration of general municipal policy ohjectives in a caucus meeting of council held in camera. 5.0 Sale of Real Pro,perty 5.1 nOpen Local Governmentll also proposes amendments to the Municipal Act dealing with the disposal of real property. The effect of the amendments will be to reduce the choices available to a municipality which decides to sell real property. For example, it appears that council would not be free to negotiate the sale with a particular purchaser who requires that land to permit other land to be developed and who would likely pay the highest price for it. Although the proposed legislation would authori1..e the Minister to prescribe a class or classes or real property which could be disposed of although not surplus to the municipality and without an appraisal of its fair market value, it does not appear to be feasible to draft regulations that would deal satisfactorily with this we just identified. 1"8 \ I r . . ',-I - 9 - 5.2 The introduction to "Open Local Government" makes it clear that the Minister is considering using the power to prescribe class or classes of real property in effect to provide the Province with the right of first purchase of municipality owned real property depending on the outcome of the Government's consultation on provincial acquisition of land for housing. All of the above is respectfully submitted. ,-,'---' :J----- . ' - . . .} / .,/ ..." ' I, t1w,ltU~ I, el) Lawrence E. Kotseff,/ Chief Administrativ~ O!ficer 1 '19 t ~)