Greater Sudbury city councillors are staring down the barrel of 18 recommendations from the auditor general that aim, ultimately, to wrest control of the contentious Healthy Community Initiative funds away from elected officials.
Brian Bigger will be delivering that report to councillors Aug. 14.
Besides recommending that councillors no longer have total control over how the money is spent, Bigger is also calling for a review on whether the money should be spent on gifts and donations, as is currently the case, since it’s difficult to judge whether a gift is accomplishing council’s stated goal for the funds.
Although councillors are not supposed to use the funds for election expenses or campaigning, a chart provided in Bigger’s report showed that spending on ward funds doubled in both 2009 and 2010 (2010 was an election year) compared to the two previous years. Councillors spent less than $250,000 in 2007 and 2008, but spent more than double that in the next two years, which could be interpreted that elected officials held onto funds to allow them to spend more in their wards closer to election time.
In the report, Bigger recommends that spending of the ward funds be curtailed in election years.
Technically known as the councillor’s expense and healthy communities initiatives (HCI) policy, and derisively called slush funds by critics, the money is controversial because individual councillors have the power to spend $50,000 a year anywhere in their wards without approval from council and with few restrictions on what the money can be spent on.
At their meeting in July, councillors debated a new policy for the funds that would have given them more transparency and added some rules on how they could be spent, but leaving them largely intact. Under the new rules, allowable expenses for ward funds would have been broken down into four categories: donations to community groups; community event expenses; gifts and promotion for community events and groups; and, capital expenditures related to municipal facilities, such as neighbourhood parks.
But before they passed the policy, Ward 3 Coun. Claude Berthiaume suggested referring the matter to Bigger, because of the controversy the funds have generated in the media and in the public.
“This is very contentious,” Berthiaume said. “I wonder if we could get input from the auditor general before we pass this motion, just to have a second look.”
In response, Bigger prepared a report on the funds in which he suggests that control of the funds revert back to city staff.
“In our view, council can achieve greater levels of success with the HCI program by shifting responsibility and accountability back to city administrators, and demanding that city administrators establish appropriate performance measures, performance targets, policies, procedures, controls and reports to demonstrate that program objectives and value for money are being achieved,” Bigger writes in his summary.
There are also some legal issues to consider. Under the Municipal Act, Bigger writes, councillors are expected to make spending and other decisions in full view of the public, with few exceptions.
“With these funds, many spending decisions are made by individual councillors in a forum that is not available to the public,” the report reads. “Details of capital projects, contributions, grants and donations are not available to the public until the money is already spent. This may place staff and other members of council in reactive or defensive positions, making it more difficult to challenge specific expenditures if guidelines are not as clearly defined as is possible.”
Municipal councillors are also not supposed to make decisions on behalf of the corporation “unless specifically authorized by statute or a bylaw of the municipality. Though it may have been council’s intention, we did not find evidence of this spending authority having been ‘expressly’ authorized by bylaw of council.”
The total amount of unspent HCI funds at the end of 2011 was $514,000, Bigger reports. Councillors can carry unspent funds from one year over to the next. Past spending by councillors was not examined by the auditor for his report.
Other recommendations in the report include:
-- adding procedures to evaluate whether the goals of the healthy community initiative are being achieved by councillors when they spend the money;
-- prohibiting spending the money on donations and gifts;
-- ensuring that the money is available to all constituents;
-- detailing exactly who is responsible for the spending decisions, and to keep a list of all requests, both those that are approved and denied;
-- returning control of the HCI budget back to the Leisure Services department, giving staff more control over spending decisions with significant input from city councillors.
Bigger’s report is likely to be music to the ears of the Greater Sudbury Tax Payer’s Association, a vocal opponent of the funds. In July, the group welcomed the decision to refer the policy to the auditor general.
“It’s been something we’ve been suggesting for a long time,” said Dan Melanson, who heads the group. Melanson said he “would fall over dead” if Bigger gave the HCI funds his stamp of approval.
He said the attempt to put the funds into an expense bylaw is “putting lipstick on a pig. It doesn’t work.” He said no matter how you look at it, these funds aren’t expenses, they’re grants. And he’s opposed to giving city councillors the power to give grants to their constituents.
In an Aug. 10 press release, the group again called on “city council to do the right thing and abolish this fund immediately.
“Unfortunately, the ongoing actions on the part of council lead us to believe that there isn’t any will on the part of councillors to abolish the HCI fund any time soon … The association believes that these questionable funding schemes should never again be allowed. The GSTA is calling on the mayor and councillors to put in place a municipal ombudsman and an ethics commissioner as soon as possible to provide taxpayers with a credible, unbiased forum with which to lodge a complaint about a program and/ or a questionable expenditure.”