HomeMy WebLinkAboutCAO 07-10
City 4 Report To Council
PI CKERIN Report Number: CAO 07-10
87 Date: May 17, 2010
From: Andrew C. Allison
City Solicitor
Subject: Establishment of a Compliance Audit Committee
under the Municipal Elections Act, 1996, as amended
Recommendation:
1. That a Compliance Audit Committee be established in accordance with the
provisions of the Municipal Elections Act, 1996, as amended;
2. That the Compliance Audit Committee be delegated full authority to exercise all
powers and functions related to compliance audit applications;
3. That the Compliance Audit Committee be comprised of three members with
credentials and experience suitable to consider matters related to the election
campaign finance provision of the Municipal Elections Act;
4. That the terms of reference for the Compliance Audit Committee including the
remuneration for Committee members be adopted;
5. That the City Clerk recruit and recommend three qualified individuals for
appointment to the committee; and
6. That the draft by-law attached to Report CAO 07-10 be enacted.
Executive Summary: Bill 212 has made certain amendments to the Municipal
Elections Act, 1996, as amended, one of which is the requirement for Council to appoint .
a Compliance Audit Committee. Previously, the appointment of such a Committee was
optional.
An elector who is entitled to vote in an election and believes on reasonable grounds that
a candidate has contravened a provision of this Act relating to election campaign
finances may apply for a compliance audit of the candidate's election campaign
finances. In this regard the Municipal Elections Act, 1996, as amended, requires that all
municipal councils and local boards must appoint a Compliance Audit Committee before
October 1, 2010, to address applications requesting a review of a candidate's campaign
finances.
Report CAO 07-10 May 17, 2010
Subject: Municipal Elections Compliance Committee Page 2 $ 8
The City Clerk is responsible for the recruitment of the committee and also responsible
for the establishment of administrative practices and procedures for the committee and
shall carry out any other duties required under the Act to implement the committee's
decisions. The Municipality is also responsible for paying all costs in relation to the
Committee's operation and activities.
Financial Implications: Factors involved in determining Compliance Audit
Committee costs include the number of compliance audit applications that might be
received, the number of meetings that are required to be held and the complexity of the
audits that may need to be conducted.
The Municipality is responsible for any costs resulting from the review of applications
submitted to the Municipal Election Compliance Audit Committee. These costs include:
- costs related to the Committee's operations and activities.
- auditor's costs to perform an audit if required.
- legal costs related to an appeal to the Ontario Court of Justice with respect to a
decision of the Committee.
legal costs to undertake legal action against the candidate for violations of the
elections finance provisions of the MEA.
costs related to the recovery of auditor costs where the auditor's report
indicates that there was no apparent contravention and the committee finds that
there were no reasonable grounds for the application.
Staff have been in consultation with GTA municipalities and while many municipalities
have yet to finalize their committee structure and processes most are recommending
providing remuneration to the Members of the Committee. It is felt that the provision of
remuneration will be a more effective means to attract candidates as it will compensate
the Members for the time away from their professions. Suggested costs within the
terms of reference for Council approval are:
- $250.00 retainer fee
- $200 per meeting
The suggested remuneration costs are average amounts being suggested by GTA
municipalities.
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Staff is recommending that the retainer fee for 3 members be taken from the 2010
Election budget. If any requests for Compliance Audits for the 2010 municipal election
are received they would occur in 2011. Council annually sets aside funding in the
Election Reserve in order to spread out the impact of the cost of the municipal election.
Staff would recommend that additional funding be placed in the Election Reserve for
2011 that would cover any potential compliance audit expenses. If the City is not in
receipt of any requests, the level of contributions to the Election Reserve in future years
could be adjusted accordingly.
Report CAO 07-10 May 17, 2010
Subject: Municipal Elections Compliance Committee Page 3
Should more compliance audit applications be received than are anticipated or if the
audits are complex, it will be necessary to seek Council's authorization for additional
funds.
Sustainability Implications: Not applicable.
Background: The. Municipal Elections Act, 1996, as amended by Bill 212, now
requires that every municipality appoint a Compliance Audit Committee prior to October
1St, 2010. The Act enables a qualified elector who believes on reasonable ground that a
candidate has contravened the election campaign finance provisions of the Act to apply
to the Clerk in writing requesting a compliance audit of the candidate's election
campaign finances.
The following is a brief overview of the compliance audit application and review process:
- an application must be made within 90 days of a candidate's financial statement
filing deadline, it must be made in writing and it must "set out the reasons for the
elector's belief";
- within 30 days of receiving an application, it must be decided whether to grant or
reject the application;
- within 15 days after the decision is made, it may be appealed to the Ontario Court
of Justice and the court may make any decision that the local authority could have
made;
if the request is granted, an auditor licensed under the Public Accounting Act, 2004
shall be appointed to conduct the compliance audit. The auditor is granted broad
powers for the purpose of conducting the audit and the auditor's costs are paid by
the municipality;
- the auditor shall conduct the audit and prepare a report which outlines apparent
contraventions, if any;
- the auditor's report shall be considered within 30 days and legal proceedings to
address any apparent contraventions may be commenced against the candidate;
and
if the auditor's report indicates that there have been no apparent contraventions
and it is determined that there are no reasonable grounds for the application, the
auditor's costs may be recovered from the applicant.
Committee Structure
With the amendment to the MEA, 444 municipalities as well as all of the various school
boards, and several upper-tier municipalities will now be seeking applicants to appoint
to their Compliance Audit Committees. This may result in competition for qualified
candidates. The competition will be even greater when one factors in the conflicting
interests between appointments to these Committees and the need for accountants and
auditors to work on the financial statements for all candidates running for offices across
the Province.
Report CAO 07-10 May 17, 2010
Subject: Municipal Elections Compliance Committee Page 4
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The Act provides that the Compliance Audit Committee must consist of a minimum of
three to a maximum of seven members. Staff is recommending a three member
committee. The Committee cannot include Council Members or City staff and must be
established prior to October 1St, 2010. The recruitment process, selection criteria, terms
of reference and compliance audit procedures are outlined below.
Recruitment of Compliance Audit Committee Members
Staff have consulted with area municipalities and have concluded that the recruitment
process for committee members varies. In all cases, minimum qualifications were
defined. Most municipalities will be posting advertisements soliciting applications,
reporting back to Council with applications that meet the minimum qualifications and
some municipalities will seek out suitable candidates through professional organizations
(ie. Chartered Accountants of Ontario, the Law Society of Upper Canada etc.) and
report to Council with recommendations for appointments.
Compliance Audit Committee members must possess an in-depth knowledge of the
campaign financing rules of the Act. If not, they will not be in a position to reach an
independent decision on the merits of the application and may look to City staff for
guidance. This would put staff in a conflict situation, particularly if the application
concerned a Member of Council
As the Committee will operate as a quasi-judicial committee, prior experience on a
Committee, task force or tribunal would also be an asset from a meeting management
perspective.
To ensure a fair, open and transparent process, staff recommend that the recruitment
process for the City of Pickering include an advertisement in the local paper and on the
municipal website detailing the selection criteria. The following selection criteria are
recommended:
- the individual's knowledge of the campaign financing rules of the Municipal
Elections Act, 1996,
- proven analytical and decision making skills;
- experience working on a committee, task force, disciplinary committee, or a similar
body;
- availability and willingness to attend meetings; and
- excellent oral and written communications skills.
To avoid a conflict of interest, care must be taken that any auditors or accountants
appointed to the Compliance Audit Committee do not audit or prepare the financial
statements of any candidate running for office on City Council. Accordingly, any auditor
or accountant appointed to the committee will have to agree in writing to not undertake
the audits or preparation of the financial statements of any candidates seeking election
on City of Pickering Council.
Report CAO 07-10 May 17, 2010
S 9j1 ct: Municipal Elections Compliance Committee Page 5
It is recommended, at the close of the application period, that all applications meeting
the minimum qualifications be forwarded to Council for consideration, selection and
appointment.
Terms of Reference:
The mandate for the Compliance Audit Committee is outlined in section 81 of the
Municipal Elections Act.
The term of the Committee is the same as the term of office of Council (2010 - 2014).
While the last day for compliance audit requests for the December 31, 2010 reporting
period is June 23, 2011, a by election could result in the need for the Compliance Audit
Committee to sit during the term of Council.
The City Clerk will act as the main contact between the Compliance Audit Committee
and Council. Staff administrative support to the Committee would be supplied by the
City Clerk.
A detailed Terms of Reference for the Compliance Audit Committee is included as
Attachment 1 to this report.
Attachments:
1. Committee Terms of Reference
2. Draft By-law
Prepared By: Approve Endorsed By:
L_v_~
Debbie Shields Andrew Allison
City Clerk City Solicitor
DS:lh
Copy: Chief Administrative Officer
Recommended for the consideration
of Pickering City Co i
Th a J. Quinn, MR, MM III
Chief Administrative Officer
ATTACHI,EWTV VO REPORT# ~ R O CU
City of Pickering 92
2010 Election
Compliance Audit Committee
Terms of Reference
Name:
The name of the Committee is the "City of Pickering 2010 Election Compliance Audit
Committee" (the Committee).
Mandate:
The powers and functions of the Committee are set out in Section 81 of the Municipal
Elections Act, 1996.
- Within 30 days of receipt of an application requesting a compliance audit, the
Committee shall consider the compliance audit application and decide whether it
should be granted or rejected;
If the application is granted, the Committee shall appoint an auditor licensed under
the Public Accounting Act, 2004 to conduct a compliance audit.
The Committee will review the auditor's report within 10 days of receipt and decide
whether legal proceedings should be commenced; and
If the auditor's report indicates that there were no apparent contraventions and if
there appears there were no reasonable grounds for the application, the
Committee shall advise Council accordingly.
Reporting and Functional Relationships:
The City Clerk will act as the main contact between the Committee and Council and will
report on Committee activity as required to the appropriate individuals and Council.
Committee Membership:
The Committee shall consist of three members appointed by the Council of the City of
Pickering. The City Clerk will recruit and recommend three qualified individuals for
appointment to the Committee.
The following persons are not eligible for appointment to the Committee:
- Employees or officers of the City of Pickering
- Members of Council
- Any candidates running in the election for which.the Committee is established
All Committee Members must agree in writing that they will not work/volunteer for any
candidate, provide advice to, prepare or audit the election financial statements of any
candidate for office on the City of Pickering Council or become a candidate in the 2010
Municipal Elections and any by-elections during Council's term, if they do, their
appointment will be terminated.
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All ommittee Members must have the ability to understand and apply the election
campaign finance provisions of the Act and should be considered impartial with respect
to their ability to fulfill their responsibilities. Preference shall be given to candidates that
have applicable experience in accounting, law, law enforcement and academics from
related fields.
Remuneration to appointed members will be as follows:
- $250.00 retainer fee (includes compensation for review of any background
materials)
- $200.00 per meeting
Membership Selection Criteria:
The recruitment process shall include an advertisement in the local paper and on the
municipal website detailing the selection criteria. Additionally, staff will contact the
Institution of Chartered Accountants of Ontario, the Law Society of Upper Canada,
Durham Regional Police Services and The University of Ontario Institute of Technology.
All applicants will be required to complete an application form outlining their
qualifications and experience.
All applications will be forwarded to Council for consideration and appointment.
The selection process will be based upon clearly understood and equitable criteria.
Members will be selected on the basis of the following:
- demonstrated knowledge and understanding of municipal election campaign
financing rules; -
- proven analytical and decision-making skills;
- experience working on a committee, task force or similar setting;
- availability and willingness to attend meetings;
- excellent oral and written communication skills;
Meeting Structure:
The Committee will be called to order when an application for a compliance audit has
been received. The date and time of the meeting will be determined by the City Clerk
and communicated directly to the committee members. All time frames outlined in the
Act and regulations will be adhered to.
Committee activity will be determined primarily by the number and complexity of
applications for compliance audits that may be received. The frequency and duration of
Committee meetings will be determined by the Committee in consultation with the City
Clerk.
An agenda shall be prepared for each Committee meeting. Minutes of each meeting
shall outline the general deliberations and specific actions and recommendations that
result.
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The Committee members will select a Chair from amongst its members at 'its first
meeting.
The Committee will conduct its meetings in public, subject to the need to meet in closed
session for a purpose authorized by section 239 of the Municipal Act, 2001.
The City's web site will be used to communicate meeting notices, agendas and
decisions.
Conflict of Interest:
Members of the Committee must abide by the Municipal Conflict of Interest Act.
Members shall not use their status on the Committee for personal or political gain.
Term of the Committee:
The mandate of the City of Pickering 2010 Election Compliance Audit Committee will be
considered complete at the end of the four year term of Council (2014), at which time, a
successor committee shall be appointed.
Exception - Any outstanding applications that have not yet been completed at the end
of the four-year term shall be completed by the Committee which first accepted the
application.
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ATfi CHMENT# TO RERORT# C fNO O,7-10
95 The Corporation of the City of Pickering
By-law No.
Being a by-law to establish a Compliance Audit
Committee for the 2010 - 2014 Term of Council
Whereas.section 81 of the Municipal Elections Act, 1996, as amended, requires the
Council to establish a Compliance Audit Committee, before October 1, 2010, for the
purposes of section 81 of the Act, and
Whereas the City of Pickering is committed to ensuring a consistent, open and
transparent process for receiving and processing compliance audit applications.
Now therefore the Council of The Corporation of the City of Pickering hereby enacts as
follows:
1. A Compliance Audit Committee consisting of three (3) members with full
delegation of the permitted authority be established under the provisions of the
Municipal Elections Act, 1996, as amended.
2. That the "Terms of Reference" attached as Schedule "A" and forming part of this
by-law, shall guide the structure and responsibilities of the Compliance Audit
Committee.
3. That the Compliance Audit Committee's authority shall extend only to
applications made with respect to candidate campaign finances related to the
2010 municipal election.
By-law read a first, second and third time and finally passed this 17th day of May, 2010.
David Ryan, Mayor
Debbie Shields, City Clerk