HomeMy WebLinkAboutCOD-029-18 Addendum ReportClarington
Corporate Services
Report
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Report To: Council
Date of Meeting: December 17, 2018
Report Number:
File Number:
Report Subject:
Addendum to COD-029-18 Resolution:
By-law Number: 2018-103
Elimination of 1/3 Tax Free Allowance for Council, and Council
Compensation Review Options
Recommendations:
That Report COD-029-18 (Attachment #1) be received;
2. That Addendum Report to Report COD-029-18 be received;
3. That Council select the preferred option to undertake a review of the compensation
value for the Mayor and Members of Council, reporting back with any recommended
changes to be effective January 1, 2019:
a) Engage an external consultant for an independent review of compensation rates and
the method of determining the salary provided, within approximately 10 comparable
area municipalities at an estimated cost range between $3,000 to 5,000 depending
on the scope of the review; or
b) That staff report back to Council on the rates that would be applicable if the average
of the lakefront municipalities was used to calculate a base (2018 rates for Pickering,
Ajax, Whitby and Oshawa), similar to the method used by Ajax and Whitby; or
c) Advertise for a Citizen Committee to undertake a review of the compensation values,
to make recommendation to Council on the annual compensation.
4. That the draft by-law (Attachment #2 to Addendum Report to Report
COD-029-18), which amends By-law 2011-005, to:
O Delete section B entirely (1/3 tax free declaration and automatic adjustment);
O Delete section D3 sub -section 2 (re OMERS equivalent),
Municipality of Clarington
Addendum to Report COD-029-18
Page 2
O Amend section D3 sub -section 3 to delete "age 69" and replace with age 71, be
approved; and
5. That based on Council's decision on the option to review compensation, staff report
back with the appropriate By-law amendments to effect Council's decision.
Municipality of Clarington
Addendum to Resort COD-029-18
Report Overview
Page 3
To provide options to Council regarding methods to undertake a review of compensation
values payable to the Mayor and Members of Council.
1. General Government Meeting Resolution
1.1 At the General Government Committee meeting of December 10, 2018, in considering
COD-029-18 which updated the comprehensive compensation by-law following the
Federal Government's decision to remove the one-third tax free allowance on Council
salaries, Resolution #JC-050-18 was passed as follows:
That Report COD-029-18 be referred to Staff to report back to the December 17,
2018 Council Meeting, to provide methodology for having a review of Council
salaries in light of the elimination of the 113 tax free allowance; and
That By-law 2011-005 be amended to remove the automatic adjustment to
maintain the net compensation equivalent value effective January 1, 2019.
2. Compensation Review Criteria
Independent Review — A) Compensation Values Only-,
2.1 An independent and unbiased review would ensure true comparisons, considering all
the different elements that may be included in compensation values. A general review
with outreach to municipalities within and outside the Durham Region would entail
gathering values and the methodology used to calculate those amounts. It is suggested
that ten (10) municipal comparisons may be reasonable to determine appropriate
salaries based on like parameters such as population, geographic challenges, industrial,
and agricultural issues.
2.2 The referenced cost is an estimate at this time as quotes have not been obtained for
this service for the independent review A) $3,000 or B) $5,000
Independent Review — B} Comprehensive Office Expenses:
2.3 If there is an interest in obtaining a comprehensive cost impact for the offices of the
Mayor and Council, it would involve a more in-depth accumulation of costs including
salary, benefits, expenses, travel, communication expenses and tools. Some of the
municipalities do not identify costs related to telecommunications etc. therefore there
may be some differences in costs presented under that type of review_ In that regard
there have been news articles in 2017 and 2016 by news media source
https:t/www.d urhamregion corn that identify relevant office costs for some of the area
municipalities, and the actual articles are available through the following links for full
information:
Municipality of Clarington
Addendum to Resort COD-029-18
Page 4
+ Pickering Council costs $433,247 in salary, expenses in 2017
https://www.d urhamregion. cominews-story/8311088-Pickering-cou ncil-costs-433-
47-in-salary-expenses-in-2017�
Oshawa Council pay tops $700,000 in 2017
https:llwww.d u rhamregion. cominews-storyl8387449-oshawa-cou nciI-pay-tops-700-
QQg-in-2g17
What did Clarington Council cost taxpayers in 2016 ( 353,880)
https:llwww.d urhamregion, cominews-storyl7212708-what- did-clari ngton-cou ncil-
cost-to x payers-in-2016?
• Politicians cost Ajax taxpayers almost $461 K in 2016
hftps://www.durhamregion.com/news-stoW7194200-politicians-r-ost-a'ax-taxpayers-
a I most-461 I- i n-2016
2.4 Should Council consider it appropriate to conduct a full spectrum review of all office
related costs, it would be recommended that it be Conducted through an independent
review, which would expand the timing and scope of the project.
Durham Area Municipalities' Practices:
,6 Within the Durham Region municipalities, there are essentially two methods used to
adjust Council compensation that have been in place for years to ensure the
municipality provides reasonable rates to attract candidates to office.
.6 In 2017 Whitby conducted a review of the practices through Report CA013-17, which
included the following table of local methods used:
Method of Determination for Annual Salary Increases
Municipality
Method of Determination
Ajax
Annual increases are determined by the average of their
comparators in the local area. (Clarington, Oshawa,
Pickering and Whitby)
Clarington
Annual increases are the same increases given to their
non-affiliated employee group.
Oshawa
Annual increases are based on the negotiated CUPE
increases.
Pickering
Annual increases are based on CUPE increases from the
previous year.
Whitby
Annual increases are determined by the average of their
comparators in the local area. (Ajax, Clarington, Oshawa,
and Pickering.)
Municipality of Clarington Page 5
Addendum to Report COD-029-18
2.7 Report COD-029-18 noted that at the time of preparing the one-third tax free allowance
report, the values had not been established.
2.8 If Council considers the average of area municipalities as a reasonable method, the
2018 base salaries of Ajax Oshawa Pickering Whitby could be used to establish the
2018 base. That would avoid the circular dilemma of who sets the rate first when one
relies on the other value to establish the rate. Future updates on that base would be in
accordance with the existing by-law parameters using the Non -Affiliated (which is the
CUPE rate) for annual adjustments, similar to Oshawa and Pickering ongoing practice.
Having the automatic adjustment was put in place historically to avoid having the rates
fall below market, and also to avoid the sensitive discussions related to one's own
salary.
Citizen Committee Review
2.9 If Council deems it appropriate to have an independent citizen group formed to
undertake a review, the opportunity Gould be advertised locally for a group of up to five
residents to conduct the review.
2.10 There may be risk in this approach given the potential varied perspective of the
participants regarding the appropriate comparisons for example using salaries from
other Government positions, executives, board positions or general labour rates could
lead to assumptions that may not reflect employment equity principles.
2.11 Although not recently the normal practice for undertaking compensation reviews due to
the long established practices reflected in by-laws, it could be undertaken by reporting
back with a terms of reference to set out the expectations of the committee_
3. Concurrence
Not Applicable
4. Conclusion
4.1 It is respectfully recommended that Council select the preferred option to review the
salaries for the Mayor and Members of Council for 2019. Any adjustments resulting
from the review would be reported to back to Council and could be effective
retroactively to January 1, 2019.
5. Strategic Plan Application
Not applicable.
Municipality of Clarington
Addendum to Resort COD-029-18
Submitted by:
Marie Marano, H.B. Sc., AMCTO
Director of Corporate Services
Page 6
Reviewed by:
Andrew C. Allison, B. Comm, LL.B
CAO
Staff Contact: Marie Marano, Director of Corporate Services, 905-623-3379 ext 2202 or
mmarano@clarington.net
There are no interested parties to be notified of Council's decision.
Attachment # 1 COD-029-18 Elimination of 1/3 Tax Free Allowance for Council
Compensation
Attachment #2 Draft By-law 2011-005 as amended
Clarington Attachment #1 Addendum Report COD-029-18
Corporate Services
Report
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Coordinator at 905-623-3379 ext. 2131.
Report To: General Government Committee
Date of Meeting: December 10, 2018
Report Number: COD-029-18 Resolution:
File Number: By-law Number:
Report Subject: Elimination of 113 Tax Free Allowance for Council Compensation
Recommendations:
That Report COD-029-18 be received;
2. That the Comprehensive Compensation By-law for Members of Council,
By-law 2011-005, as amended, be further amended as follows:
a. Section B.
Remove reference to the provision of the 1/3 tax free exemption, and the
automatic adjustment to maintain the net compensation equivalent value
effective January 1, 2019; and
b. Section D 3.
Subsection 2. Remove reference to the OMERS equivalent pension
contribution paid on current remuneration effective January 1, 2019; and
Subsection 3. Amend OMERS deductions stop at age 71, in accordance
with changed OMERS criteria; and
3. That the draft by-law amending By-law 2011-005, Attachment 5 to Report COD-016-18,
be approved.
Municipality of Clarington
Report COD-029-18
Report Overview
Page 2
In March 2017 the federal budget eliminated the one-third tax free exemption for Municipal
elected officials beginning in 2019. This report informs Council of that decision, and
confirms that the existing comprehensive compensation by-law accommodates the
elimination of the exemption and maintains the same net compensation value as an
automatic adjustment.
1. Background
Municipal Act and Existing By-law #2011-005 and #2014-123
1.1 The Municipal Act, 2001 Subsections 283(5) and (7) provide that if one-third of the
remuneration paid to elected Council Members is continued, Council must review the
by-law provisions at least once during the four-year term of office.
1.2 Clarington's comprehensive By-law #2011-005 for compensation policies section B
(Attachment #1) sets out the tax free declaration, allowing 1/3 of compensation to be tax
exempt. The required review for the current term of Council is set out in the amending
By-law #2014-123 (Attachment #2).
1.3 By-law 2011-005 provides that Council's compensation would not be negatively affected
if the one-third exemption was to be eliminated, by providing for an automatic
adjustment to maintain the same net compensation value.
2. 2017 Federal Budget — Eliminating the 1/3 Exemption
2.1 In March 2017 the federal budget eliminated the 1/3 tax free exemption for Municipal
officials beginning in 2019. The AMO notice to all municipalities (Attachment #3)
advises that the course of action be identified now for incoming Council after the fall
election. The CRA website notice (Attachment #4) also notes the impact on the Council
Members' income and T4 slip.
2.2 The existing By-law 2011-005 provides for an automatic adjustment, and as such there
is no action required by Council, other than to remove the related references from the
By-law. The net compensation value of the incoming Council, beginning in 2019, will be
maintained. The OMERS equivalent payment that pays a pension value on the 1/3
exempt portion that does not have an OMERS contribution/deduction applicable will be
discontinued because the adjusted compensation will all be taxable and pensionable.
Municipality of Clarington
Report COD-029-18
3. Financial Implication — 2019 Budget
Page 3
3.1 The individual Council member's net salary will remain the same, however there is a
Municipal budget impact related to the Federal decision to remove the 1/3 tax free
exemption. The Municipality will pay approximately $92,848 (Mayor $47,573, and
Councillors $45,275) based on 2018 salaries (full year) to provide that Council Members
are able to take home the same compensation, net of applicable statutory deductions.
The Director of Finance will include the appropriate amount in the 2019 budget as a
non -controllable expense.
Area Municipalities Status:
Municipality
1 /3 Tax
Free Status
Previously
2019
Adjustment to Provide Same Net Compensation
Implemented
Ajax
Yes
Yes
Oshawa
Unknown at this time what action will be taken
Pending Decision
Pickering
No official plan at this time
Pending Decision
Whitby
By-law requires automatic adjustment
Proceeding
Region
Adjusted in
2004
Adjusted to provide same net compensation and
adjusted to reflect 75th percentile of comparators.
Implemented in
2004
Municipality of Clarington
Report COD-029-18
2019 Rates for Mayor and Councillor
Page 4
Municipality
Increase
Percent
2019 Rate
for Mayor
2019 Rate
forCouncillor
Oshawa
1.95%
$98,338
$4T,491
Pickering
1.50%
$87,407
$36,420
Whitby
Averaged
not calcuated yet
Ajax
Averaged
not calcuated yet
Clarington
1.75%
$93,124
1 $37,250
Note: All rate increases are based on 2018 salary only. Whitby's and Ajax's current by-law
are based on the averages of comparators in the local area.
4. Concurrence
Not applicable.
5. Conclusion
It is respectfully recommended the report be received, and the appropriate action be
taken to comply with the existing By-law provisions to accommodate the elimination of the
1/3 tax free allowance, with appropriate amendments to update the By-law.
Submitted baarie
no, H.B. Sc., C.M.O.,
Director of Corporate Services
Reviewed by: X4111�
Andrew C. Allison, B. Comm, LL.B
CAD
Staff Contact: Marie Marano, Director, 905-623-3379 ext. 2201 or mmarano@clarington.net
Attachments:
Attachment # 1
By-law #2011-005 Comprehensive Compensation for Members of Council
Attachment # 2
By-law # 2014-123 Amending By-law for By-law 2011-005 re 1/3 Tax Free
Attachment # 3
AMO Notice Regarding Elimination of the One -Third Tax Free Allowance
Attachment # 4
Government of Canada Bulletin — Municipal Officers Expense Allowance
Attachment # 5
2018 Draft Amending By-law for By-law # 2011-005
There are no interested parties to be notified of Council's decision.
Attachment #2 Addendum Report COD-029-18
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Coordinator at 905-623-3379 ext. 2131.
The Corporation of the Municipality of Clarington
By-law No. 2018-XX
Being a By-law to update the compensation applicable to Mayor and
Members of Council and to amend By-law No. 2011-005 to remove
references to the 1/3 tax free allowance and change the age for OMERS
deductions to stop.
Whereas the 2017 Federal Budget eliminated the 1/3 tax free allowance,
And whereasBy-law No. 2011-005 provides for a 1/3 tax free allowance applied
to the local level remuneration in accordance with Section 283(5) of the Municipal
Act, 2001;
And whereasBy-law 2011-005 requires an amendment to remove reference to
the allowance going forward;
1. Now therefore the Council of the Municipality of Clarington enacts as
follows:That By-law 2011-005 be amended as follows:
a) Section B
Delete section B referencing 1/3 Tax Free Allowance, in its entirety;
b) Section D 3
Subsection 2. Delete the words ""OMERS equivalent" pension
contribution paid on current remuneration; and
Subsection 3. Delete the word "69" and replace it with the word 71", in
accordance with OMERS criteria.
2. This By-law shall be effective January 1, 2019.
By-law passed in open session this 17t" day of December, 2018.
Adrian Foster, Mayor
C. Anne Greentree, Municipal Clerk
Attachment #1 Report COD-029-18
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
BY-LAW # 2011 — 005
Being a by-law to update the prevailing compensation policies applicable to the Mayor
and Members of Council, and to repeal by-law# 2007-097.
WHEREAS Section 283-1 of the Municipal Act 2001 provides that a municipality may
pass by laws for paying remuneration to the Members of Council;
WHEREAS On March 19, 2007 the Council of the Municipality of Clarington ratified
report ADM-002-07 Mayors Compensation Review-2007, authorizing staff to bring
forward a comprehensive by-law to consolidate the compensation practices for the
Mayor and Members of Council, which was set out in By -Law 2007-097 and now
requires updating for compliance;
NOW THEREFORE BE IT ENACTED AS FOLLOWS:
A. ANNUAL REMUNERATION
Mayor and Council - Amount as set out in prevailing by-laws for particular year in
accordance with the following:
Provisions:
1. Future increase to annual remuneration will be the percent applicable to
the Non -Affiliated Employees salary for the same period of time, applied
on January 15` of the applicable year, or as otherwise stated.
2. There is no additional compensation applicable to any prevailing Deputy
Mayor position.
2. Councillor remuneration is set at 40% of the Mayor's salary.
3. Remuneration continues until the end of the term of Council.
4. Regional remuneration - Clarington Council endorsed single stream
payment of the Regional portion of compensation through the local level
by approval of Report COD-65-04.
The Region approved single stream payment by By -Law 01-2005 and 08-
2004, and is considered the Employer for Region compensation
purposes.
B. 1/3 TAX FREE DECLARATION
B.1, In each term Council is required by the Municipal Act S283 (7) to confirm its
intention to retain the 113 tax free allowance as provided for in the Municipal Act;
Council hereby confirms 1/3 tax free allowance applied to the local level
remuneration for the prevailing term from December 2010 to December
2014.
B.2. The tax free portion of remuneration is currently exempt from reporting
requirements under the Public Sector Salary Disclosure Act, and remuneration
will continue to be reported as required under the prevailing Act.
B.3. Council maintains the commitment to adjust future compensation to maintain an
equivalent net compensation value should the Municipal Act be amended or
repealed and replaced with provisions that in effect prohibit an income tax free
allowance. Compensation will be automatically adjusted to maintain the same
net compensation level.
C. TRAVEL ALLOWANCE & REIMBURSEMENT GUIDELINES
C.1. Monthly Flat Rate Allowance
Mayor, Deputy Mayor, Councillor — as set out in prevailing by-laws for particular
year in accordance with the following:
Provisions:
1. Monthly flat rate allowance will be paid to compensate for travel related to
Municipal business within Municipal boundaries.
2. Allowance shall be paid through payroll with statutory deductions applied.
3. The allowance shall be paid on an automatic basis unless any Member of
Council elects not to be reimbursed and provides written notice to Payroll
of the effective date of cancellation.
4. Future increases will be the percent applicable to the general non-
affiliated grid increase, applied to the total monthly allowance, in each
year, unless Council amends otherwise. Increase will be applied at the
date of the change to the employee grid.
5. If any travel is reimbursed for travel outside of the Municipal boundaries
over and above the monthly allowance, it will be at the prevailing
employee kilometre rate, in accordance with the guidelines below.
C.2. Travel & Expense Reimbursement Guidelines
C.2.1 Municipal Business
Municipal business will be considered to include the following:
I. Travel to and from any meetings of Boards Commissions or
Authorities or other groups to which Council members are appointed
or delegated provided they are held outside the municipal
boundaries and travel expenses are not paid by the aforementioned
agencies;
ii. Travel to and from any event sponsored by the Corporation towards
the promotion of the Municipality where Council attendance is
required or requested outside the Municipality;
Accommodation, meals, kilometre reimbursement for travel outside
of municipal boundaries, parking, registration and other
miscellaneous charges related to municipal business which may
include among other things attendance at any seminar, conference,
events or convention approved by Council and attended as a
Council representative or as provided for through the current budget
allocation;
iv. Travelling to and from the Municipal Administrative Centre will NOT
be considered to be Municipal business in the following instances:
a) Attendance at all General Purpose and Administration
Committee meetings and Council meetings.
b) Meetings with Town Staff.
c) Picking up of agendas.
d) Constituent meetings.
C.2.2 Expense Claims and Approvals
V. All claims for payment shall be documented using the prevailing
expense claim sheet and where possible supported with receipts.
vi. Mayor: Expense claims for reimbursement of expenses by the
Mayor shall be submitted as soon as possible after the month end
and approved for payment by the Chief Administrative Officer or in
the alternative, by the Director of Finance.
vii. Members of Council: all expense claims for reimbursement of
expenses for Members of Council shall be submitted as soon as
possible after month end to the Mayor for approval. In the absence
of the Mayor, the Chief Administrative Officer, or in the alternative,
the Director of Finance shall approve the expense claims for
payment.
C.2.3 Annual Report to Council
All expense claims and compensation, severance, etc., shall be
categorized and included in the annual remuneration report to Council in
accordance with the prevailing Municipal Act requirements.
C.2.4 Special Events Expenses
There are occasions throughout the year where the Corporation may host
special events to promote the Municipality. The following guidelines apply
to such events:
i Payment of expenses as it relates to the hosting of government
officials industrial prospects or other groups visiting the Municipality of
Clarington or the hosting of receptions for same within the Municipality
will require the submission of an expense claim indicating the number
of people hosted and the date as well as the specific amount of
expenditure. Such claims must be supported by the applicable
receipts or documentation.
ii All claims for payment or expenses related to special events shall be
submitted as soon as possible after the month end to the Mayor for
approval. In the absence of the Mayor the Chief Administrative Officer
or, in the alternative, the Director of Finance shall approve the claims
for payment
D. BENEFITS PROVIDED FOR CURRENT SITTING MEMBERS
General Application
1. Family or Single Coverage
2. Any member may choose not to receive any benefit by advising Payroll in
writing.
3. All benefits are limited to provisions set out by the prevailing carrier.
4. All benefits cease at age 65 unless expressly identified even if the
member is currently on Council.
D.1 Health & Dental
Generally, as applicable to Non -Affiliated Employees for
Health, Dental and Travel Benefits, excluding any self funded provisions.
D.2 Life Insurance and Accidental Death & Dismemberment (ADD)
Prevailing policy generally as applicable to Non -Affiliated
Employees; Reduced at age 65 to 50%, and at age 70 to
$25,000 or amount set out in prevailing carrier plan.
D.3 OMERS
1. Mandatory participation and individual contribution as set out by OMERS.
2. Per ADM-03-02, an "OMERS equivalent' Retirement Pension contribution
of 7.5% of the portion of the current remuneration that is not eligible for
OMERS contribution is established for all Members of Council effective
January 1, 2002.
3. All OMERS deductions stop at age 69 in accordance with OMERS
criteria.
D.4 Sick Leave Benefits
Short Term or Long Term Disability (LTD) benefits are not
provided to Members of Council.
D.5 Other
Communication tools such as cell phones or blackberries are as provided
for in the annual operating budget. Usage of such equipment is governed
by prevailing corporate policies.
TUITION ASSISTANCE & MEMBERSHIP FEES POLICY
In accordance with Report ADMIN.16-2000, the following policy applies unless
otherwise specifically approved by Council resolution:
The Municipality will not pay for any educational courses to any
Member of Council, including any membership fee of any
professional association. The only exception is orientation
seminars offered to new Members of Council by the Ministry of
Municipal Affairs and Housing.
F. CREDIT CARDS
The Mayor is provided with a credit card for the purpose of Municipal business
expenses, as noted in report ADMIN 9-94. Statements are submitted to the CAO
for processing of payment, or in the alternative, to the Director of Finance for
processing of payments.
G.SEVERANCE
Payment of severance remuneration to current and future members of Council is
upon the following terms and conditions:
GA Definitions:
a) "annual remuneration" of the member means the annual amount of remuneration
paid to the member for the discharge of all duties as a member of Council
including both the tax exempt and taxable portions calculated as at the date of
severance;
b) "member" means any person who is or becomes a member of Council on or after
the 19th day of January 2004;
c) "service" shall mean any period of continuous service as a member and shall
include any member's period of service occurring prior to the 19'h day of January
2004
d) Retroactivity — there is no severance applied to years of broken service.
G.2.1 Eligibility:
Upon application by the member or his or her personal representative a member
is entitled to receive severance remuneration upon ceasing to be a member by
reason of:
a) election defeat;
b) resignation;
c) leaving office; or
d) dying while in office if the member is 65 years of age or over and not
eligible to receive benefits under the Municipality's group life insurance
program.
G.2.2 Ineligibility:
No member shall be entitled to receive severance remuneration who ceases to
be a member by reason of or by resignation which is a result of or given in
anticipation of:
a) removal from office by judicial process; or
b) disqualification under or operation of any Act of the Parliament of Canada
or the Legislature of the Province of Ontario
G.3 Remuneration:
Severance remuneration shall be equal to one -twelfth (1112) the annual
remuneration of the member times the number of years service of the member
pro -rated for part years of service to a maximum amount payable of eighteen
(18) months remuneration.
GA Payment:
Payment of severance amount may be split and paid over a maximum of 3 years;
and is subject to all applicable statutory deductions.
G.5 Claim:
A written request for severance remuneration must be received by the Municipal
Clerk within six (6) calendar months of a member ceasing to be a member
otherwise any entitlement to severance remuneration shall be forfeited.
REPEAL BY-LAWS
The following By -Law is hereby repealed; #2007-097.
EFFECTIVE DATE: This By law shall come into force on the date of passage.
By-law read a first and second time this 17`h day of January, 2011
By-law read a third time and finally passed this 17'" day of Janua 011
r.r,_IVIayUr
rie Municipal Clerk
Attachment #2 Report COD-029-18
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
BY-LAW NO. 2014-123
Being a By-law to retain the 1/3 tax free allowance for
Members of Council for 2014-2018 Term of Council
WHEREAS Section 283 (1) of the Municipal Act, 2001 provides that a
municipality may pass by-laws for paying remuneration to the members of
Council;
AND WHEREAS Council enacted By -Law 2011-005 confirming 1/3 tax free
allowance applied to the local level remuneration in accordance with Section
283(5) of the Municipal Act, 2001; and
WHEREAS Section 283 (7) requires Council to review the by-law passed in
accordance with Section 283 (5) at least once during the four-year period
corresponding to the term of office of its members after a regular election;
NOW THEREFORE BE IT ENACTED AS FOLLOWS:
1.. By-law 2011-005 be amended to deleted Section B.1; and
Council hereby confirms 1/3 tax free allowance applied to the local level
remuneration for the prevailing term from December 2014 to December
2018.
BY-LAW passed in open session this 151h day of December, 2014.
ian Foster, Mayor '
,f
t_.
4
C. Anne Greentree, Municipal Clerk
Attacnment TT 3 Keport cxuli-v2v- i u
ANPIOAssocialionof
MunicipalitiesOntario ppLICY UPDATE
March 27, 2018
One -Third Tax Free Exemption for Municipal Officials
In March 2017, the federal budget announced the government's intention to eliminate the one-third
tax free exemption for municipal elected officials beginning in 2019. The 2018 federal budget
delivered last month did not signal any change from that plan.
AMO's Board of Directors passed a resolution last June seeking the involvement of the Federation of
Canadian Municipalities (FCM) on this matter. FCM has advised they have been raising this issue
with federal officials over the past months but again, there have been no signs to suggest a change
of plan for 2019.
While 2019 is nine months away, a municipal government may want to begin considering what
course of action to take or at least to note it as a matter for the incoming council after the fall's
municipal election.
AMO would also like to thank the 144 municipal treasurers who took part in our salary survey. Over
90%.of survey respondents indicated their municipality uses the exemption. This information was
provided to FCM in support of their advocacy efforts.
Here are some examples from the survey which illustrate the impact of this change in 2019:
-The cost increase for a central Ontario municipality with a council of nine and a population of
30,000 will be at least $28,000.
-The cost increase for an eastern Ontario county council of seventeen and a population of 77,000
will be at least $74,000.
-The cost increase for a southwestern Ontario municipality with a council of seven and a population
of 24,000 will be at least $14,000.
For almost half of Ontario's municipal governments, a one per cent property tax increase raises only
$50,000.
Also available for member municipal governments is 2017 survey results on council salaries. Use
your AMC) login to access the salary survey information available on the Dashboard. If you have
forgotten your login details, please email amo@amo.on.ca.
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Municipal officer's expense allowance - Canada.ca Attachment #4 Report COD-029-18
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of Canada
Government Gouvernement
du Canada
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expense allowance
A municipal corporation or board may pay a non -accountable expense allowance to an elected
officer to perform the duties of that office.
If the expense allowance is more than one-third of the officer's salary and allowances, the excess
amount is a taxable benefit. Enter it in box 14, "Employment income," and in
the "Other information" area under code 40 at the bottom of the employee's T4 slip.
If the expense allowance is not more than one-third of the officer's salary and allowances do not
include this amount in box 14, "Employment income," or in the "Other
information" area under code 40 at the bottom of the employee's T 4 slip.
In either of the above situations, you have to identify the non-taxable share of the allowance by
entering the corresponding amount in the "Other information" area under-code-70-at-thebottom
of the employee's T 4 slip.
For more information, see Interpretation Bulletin IT292, Taxation of Elected Officers of Incorporated
Municipalities, School Boards, Municipal Commissions and Similar Bodies.
Note
For 2019 and later tax years, non -accountable allowances paid to elected officers will be
included in their income. This change was stated in the 2017 federal budget, which received
royal assent on June 22, 2017 (Bill C 44).
Date modified: 2017-12-15
https://vVvvw.canada.ca/en/revenue-agency /services/tax/businesses/topics/payrol 1/benefi ts-
10/30/2018
In addition, Budget 2017 confirms that the First -Time Donor's Super Credit will be
allowed to expire in 2017 as planned, due to its low take-up, small average
amounts donated, and the overall generosity of existing tax assistance for
charitable donations.
Providing Greater Consistency
Budget 2017 also makes changes to improve consistency in the treatment of
similar kinds of income and the consistency of tax measures with other priorities
of the Government and current economic conditions.
Employee Benefits and Allowances
In today's workforce, many Canadians receive benefits —such as a daily food
allowance or transit fare —which are counted as taxable income. Yet certain tax
measures allow some individuals to pay less than their fair share of taxes on such
benefits. These measures are unfair and they lack a strong policy rationale. To
improve consistency, Budget 2017 proposes to:
• Eliminate the deduction in respect of employee home relocation loans.
Evidence suggests that this deduction disproportionately benefits the
wealthy, and does little to help the middle class and those working hard to
join it.
• Remove the tax exemptions for non -accountable expense allowances paid
to members of provincial and territorial legislative assemblies and to certain
municipal office -holders. This exemption is only available to certain provincial,
territorial and municipal office holders, and provides an advantage that
other Canadians do not enjoy.
Fossil Fuel Subsidies
The Government has a strong plan to invest in clean growth that will help create
middle class jobs and get the country on the path to a low -carbon economy.
Consistent with this plan, Canada has made a commitment with its partners in
the G20 and Asia -Pacific Economic Cooperation to phase out inefficient fossil
fuel subsidies. Such subsidies can encourage wasteful consumption, impede
investment in clean energy sources, and undermine efforts to combat the threat
of climate change.
Attachment #2 Addendum Report COD-029-18
If this information is required in an alternate format, please contact the Accessibility
Coordinator at 905-623-3379 ext. 2131.
The Corporation of the Municipality of Clarington
By-law No. 2018-XX
Being a By-law to update the compensation applicable to Mayor and
Members of Council and to amend By-law No. 2011-005 to remove
references to the 1/3 tax free allowance and change the age for OMERS
deductions to stop.
Whereas the 2017 Federal Budget eliminated the 1/3 tax free allowance,
And whereasBy-law No. 2011-005 provides for a 1/3 tax free allowance applied
to the local level remuneration in accordance with Section 283(5) of the Municipal
Act, 2001;
And whereasBy-law 2011-005 requires an amendment to remove reference to
the allowance going forward;
1. Now therefore the Council of the Municipality of Clarington enacts as
follows:That By-law 2011-005 be amended as follows:
a) Section B
Delete section B referencing 1/3 Tax Free Allowance, in its entirety;
b) Section D 3
Subsection 2. Delete the words ""OMERS equivalent" pension
contribution paid on current remuneration; and
Subsection 3. Delete the word "69" and replace it with the word 71", in
accordance with OMERS criteria.
2. This By-law shall be effective January 1, 2019.
By-law passed in open session this 17t" day of December, 2018.
Adrian Foster, Mayor
C. Anne Greentree, Municipal Clerk