CAO Bonus- Appropriate?

In March 2014 I received a letter from the former council of the RM of Shellmouth-Boulton barring me from attending the office and from communicating with the administrative staff. The justification for this action as stated in the letter was, in part, ‘you have made repeated and ongoing requests to the Municipality for copies of various information.’ They were correct in that regard but my question is ‘Where else would someone go for copies of municipal information if not to the municipal office?’ This information was not available anywhere else and is information that the public is entitled to have. The CAO is obligated, under the Municipal Act, to provide this information within a reasonable time. My requests were repeated and ongoing because the initial requests were either refused or delayed.
The letter went on to state ‘You…are making the administrative staff uncomfortable in the manner that you are dealing with them.’ No doubt I was. The CAO, and the council, were not accustomed to having someone asking questions about what was (and was not…) going on and they certainly did not like it when I pointed out that they were wrong. I am beginning to understand why they felt uncomfortable. It may be coincidental but the ‘barring letter’ arrived shortly after I asked for the CAO’s job description.
Consider this… In 2013 the CAO was being paid $75K. The ‘Employment Agreement’ between the CAO and the municipality states that this amount was in recognition of the fact that in addition to the regular hours, some overtime was expected. Despite the fact that in Manitoba any hours in excess of 8 in a day or 40 in a week are to be paid at time and a half she agreed to work the regular hours AND the expected overtime for the salary of $75K. It should be reasonable to expect that had the contract not included the anticipated overtime, the amount would have been less than $75K.
At the January 2014 meeting, the council of the RM of Shellmouth-Boulton agreed to pay the CAO a bonus of $15K. When I questioned this bonus at the financial plan meeting in May 2014 we were told that this bonus was for 512 hours of overtime that the CAO had worked in 2013. How is it right to take a salary of $75K that is set at that amount to cover overtime and then be paid $15K for overtime?
Admitted, 512 hours is a lot of overtime but for overtime hours to be legitimate, they have to be approved by the employer, in this case council. Were these hours of overtime approved? Did anyone check to see if they were legitimate? You would expect that council would attempt to verify this claim before approving it. But if they did, how much time was spent doing so? The topic of the CAO’s overtime was not mentioned on the agenda nor was it added to the agenda. It just appears as a topic of discussion and is approved.
Then I find out that the 2014 Employment Agreement (contract) had a new clause whereby the CAO is paid $125/day when attending training sessions. I was told that the idea of paying employees when they are taking training was put in place to compensate the hourly employees when they are away from their regular duties. I understand that for the hourly employees. But for a salaried employee??? I could understand this if the training took place on a weekend or in the evening. But these people are on a salary. They are already being paid to work that day. How are they entitled to another $125 on top of their salary? This clause appears in the CAO’s and other salaried employees’ 2015 contracts as well.
Both the former Shellmouth-Boulton council and the current Riding Mountain West council seem to be okay with these terms. Neither council seems to appreciate me asking questions and my banishment continues.


Fixing a Mistake?

After attending the amalgamation information meeting in the fall of 2013 it was obvious that the amalgamation plans were in place and that there was little anyone could do to change the direction dictated by the councils. I was unhappy with the way the councils of Shellmouth-Boulton and Silver Creek had gone about formulating the amalgamation plan between the two municipalities. The lack of public consultation was a serious concern. The misinformation regarding the impact of Russell’s debt was also a problem.

On the surface it seemed as though the interpretation of what impact this debt would have on the taxes of amalgamation partners could have been an honest mistake. But why, when the question was raised and when information was available that contradicted this fallacy, did the CAO and the majority of the council fail to look into the matter? One would have thought that the CAO would have seen fit to research this issue and provide council with the correct information. But this was not done. Instead an incorrect interpretation was repeatedly advanced as justification for not considering a larger amalgamation.

After the meeting in Inglis where it was finally conceded that Russell’s debt was not an issue for amalgamation partners, my wife and I discussed how this issue was dealt with at the Angusville meeting. I had raised the question and the reeve of Shellmouth-Boulton rose and emphatically stated “Rod, you are wrong. You are wrong.” Nothing was said at the Angusville meeting after this unequivocal statement  to give anyone reason to believe anything other than the fact that the reeve was right and I was wrong. That bothered me immensely.

I don’t mind admitting that I am wrong when I have made a mistake. I have a real problem though when someone publicly accuses me of being wrong when I am not. After pondering the matter at length, I decided that I could not let this go without asking for a correction.

I contacted the municipal office in Inglis and made arrangements to meet with the reeve and the CAO. My wife and I attended the office in the morning of October 24th, 2013. Knowing that the reeve and the CAO would support each other, I wanted to have another set of eyes and ears to hear what was being said.

I recapped what had happened at the Angusville meeting and told the CAO and the reeve that I was concerned with the fact that none of the attendees at that meeting would know of the retraction that was made at the Inglis meeting. I explained to both of them that my integrity is hugely important to me. I pointed out that the misinformation was at their feet and that I felt that it was their responsibility to fix the problem that they had created.

The CAO told us that it sounded as though I was demanding a public apology. I told her that I was not but that I thought that she and the reeve had made a mistake that they needed to fix. I left it with them to decide how they would fix it. I also told them that if they would not fix it, that I would. My wife and I then left the office.

In hindsight I should have outright demanded a public apology. What was done to fix the mistake was an ineffective and pathetic effort to fix the problem that they had created.  The comment “As a follow up to the Angusville Public Information Meeting, Provincial Consultant Bob Brown clarified the Russell Multiplex debt is roll specific not general” appeared in an article in the Russell Banner on November 5th, 2013. That was it! Wow! Talk about taking ownership of a mistake.

I spoke to the reeve about this article and he advised me that he had left it with the CAO and that he was satisfied that the issue was dealt with appropriately.

A Done Deal

When municipal amalgamation was being considered by the council of the rural municipality of Shellmouth-Boulton in 2013 this consideration was being done by the municipal councillors themselves. From what I can gather, the councillors talked about amalgamation amongst themselves and they may have individually talked to friends and neighbours but there never was a public meeting to discuss what was best for the municipality.

I learned of these discussions from the councillor in the ward in which I live.  I attended council meetings and specifically asked if and when public meetings were to be held. I thought that it would be interesting and insightful to hear what options were being considered. I had my own ideas but I was curious to know what others in the municipality thought. Sadly, council did not share the desire to hear from their ratepayers. No public consultation meeting was ever held.

The questions that I had were never answered. The following are a few that I thought might have been relevant:

-What efficiencies could be achieved by municipal amalgamation? Do we really need 5 councils (with 5 reeves/mayors, 25+ councillors, 5 CAOs, etc.) to manage the affairs of an area with approximately 3000 people?

-How much money would be saved by eliminating duplication of services by amalgamating with one, two, three or more adjacent municipalities? What cost savings could be expected by considering different options?

-What improvements (infrastructure, programs, etc.) could be achieved by reallocating the tax dollars saved by the elimination of duplication?

The closest we ever came to having a public consultation were the public information meetings that were held in Angusville and Inglis in October 2013. These were in no way consultative. We were being told what the two councils had planned. The fix was in. The deadline was looming. There was no time left to consult the public. That time had been squandered resisting amalgamation. The feedback sheet that we were given at the end of these meetings was nothing more than a feeble attempt to declare that the public had been asked for input. All that they were really asking for was suggestions for a name of the new municipality that they were imposing on the ratepayers.

In The Beginning – Municipal Amalgamation

Up until the early summer of 2013 I had little interest in municipal politics. I had attended a couple of council meetings with a casual interest in seeing how local government was run but found that the meetings were pretty tedious. I had heard some rumblings about the Manitoba provincial government issuing a directive to municipalities with a population of less than 1000 to amalgamate with another municipality but other than that I had heard (and cared) very little. A close friend who is a municipal councillor and who was, in fact, the representative for the ward in which I live, had mentioned going to public meetings in the surrounding municipalities but we really hadn’t gotten into any discussion about what was going on.
In May of 2013 I went into the council office for the Rural Municipality of Shellmouth-Boulton to pick up a package that had been dropped off for me by the courier company. After the usual exchange of pleasantries with the CAO I was about to leave. The CAO stopped me momentarily with a question that went something like this:
“Rod… you’re a man of the world (her words… not mine…). What do you think of this forced amalgamation plan?”
She drew my attention to a bright, ‘grab-their-attention’ sheet of paper that had been typed in all capital letters and titled ‘NOTICE TO THE RATEPAYERS OF SHELLMOUTH-BOULTON’. I had seen this letter as one had been placed in my post office box and although I had glanced at it, I had not paid it much attention. Certainly not enough to feel comfortable engaging in a meaningful discussion on its contents. I told her that I supported the concept of amalgamation but that I had other matters to attend to that day as well so I begged off, asking the CAO if it would be possible to talk about the matter another day. She agreed. I left.

My first step in educating myself on the matter was to contact my friend, the councillor. My questions to him were “Who was the author of the letter that I found in my mail box?” and “Was this a decision of council or the initiative of an individual or group of individuals and not the council as a whole?” The councillor advised me that he was not aware of any resolution passed by council to authorize such a letter or to approve the wording. Subsequent checks of the minutes of the RM of Shellmouth-Boulton council meetings shows that at the February 2013 regular council meeting the council passed a resolution indicated that the council was opposed ‘to the Province’s decision to force municipalities to amalgamate’. None of the minutes of council show that the ‘NOTICE TO RATEPAYERS…’ letter was as a result of a council decision. It would appear that this notice was the work of an individual or group of individuals and not the council itself.

A couple of days later I returned to the council office to continue the discussion that the CAO had initiated. She invited me to accompany her to a small office off the main public area. I do not have a word-for-word recall of the conversation that took place but I do remember mentioning the potential benefits of efficiencies that could be realized by amalgamating several smaller municipalities. I also stated that I thought that by amalgamating municipalities, new ideas and a change in the way municipal business was conducted might occur. It became apparent that my opinion was not shared by the CAO. She could see no benefit by amalgamating with any other municipality(ies) and was clearly opposed to the ‘forced’ nature of the concept as put forth by the provincial government.

Looking back on what occurred to that point and in light of what I now know, I can see problems arising from the CAO’s actions. It would seem that, as an employee of the municipality the CAO should be carrying out the wishes of council and acting on decisions that council makes. Soliciting opinions from the ratepayers and becoming actively involved in gauging public opinion should not be the responsibility of a CAO especially under these circumstances. One of the first questions that arises when considering the impact of amalgamating municipalities is what effect this will have on the employment of the municipal employees. As a municipal employee, the CAO position would certainly be up for grabs. Each of the CAOs in municipalities that amalgamated could be in the running for the position of CAO in the newly formed municipality. The likelihood that one or more of the existing CAOs would lose their job or be reclassified into another position is considerable.

In this situation the fact that the CAO was actively involved in matters that should be left to the elected officials is worrisome as it could be considered an abuse of position.

My curiosity had been piqued by what had taken place to this point. I began to search for more information.

A web search quickly revealed a document titled “Guide to Municipal Amalgamation- Developing Your Amalgamation Plan” and to a section titled “Public Consultation”. The following are quotations from this document:

“It is therefore important for amalgamation partners to obtain public input when making decisions to ensure citizens’ interests are taken into account.”

“Amalgamation partners should provide citizens with information on their Amalgamation Plan as the Plan is being developed. A description of the amalgamation partners’ public consultation process must be included in the Amalgamation Plan.”

It is evident that the provincial government recognized the importance of ‘public input’ and ‘citizen’s interests’. Municipal councils are also instructed to ‘provide citizens with information on their Amalgamation Plan as the Plan is being developed’. This guide goes on to suggest that:

“Municipalities can consult with the public in a variety of ways. Methods used in previous amalgamations include holding public meetings, inserting an article in the local newspaper or municipal newsletter, or posting information on the municipalities’ websites. Other ways can also be considered.” and

“If a public meeting is held, it is important to provide advance notice to citizens. The amount of notice should typically be consistent with notice provisions for public hearings under The Municipal Act (eg. at least twice during the period starting 40 days before the meeting and ending seven days before the meeting).”

The advice provided in this guide seems to be good, common-sense information. It is, however, just a guide to municipal amalgamation. There is nothing here that would compel a municipal government to follow any of these suggestions. A further search of the web revealed the provincial government had introduced legislation in the form of the Municipal Modernization Act . A quick read of this act shows that Section 3(3) states ‘In developing their amalgamation plan, the municipalities must provide a reasonable opportunity for members of the public to comment on the content of the proposed plan.’

It should be noted that when I discovered this information in May 2013, the Municipal Modernization Act was still draft legislation that was pending royal assent. Royal Assent did not take place until September 13th, 2013. Given the fact that the NDP government of the day held a clear majority there was very little doubt that this legislation would pass and become law. I found it interesting that Section 3(3) states ‘The municipalities must provide a reasonable opportunity for members of the public to comment on the content of the proposed plan.’ All that the municipalities had to do is provide a reasonable opportunity for members of the public to comment on the content of the proposed plan. It was left up to them to make the ultimate decision on what was going to be done but the legislation states that they must provide an opportunity for the public to be heard.

An article in the local paper, the Russell Banner, on April 2, 2014, details an interview that the editor of this paper conducted with the reeve of the RM of Shellmouth-Boulton, Alvin Zimmer. In this article Mr. Zimmer comments on the amalgamation proposal and expresses his concern that the province did not consult the municipalities before proceeding with their decision to mandate amalgamation of municipalities with a population of less than 1,000. Mr. Zimmer is quoted as saying “No consultations were held and no reasons were given!” The comment “Municipal Councils are elected to make decisions in the best interests of their ratepayers but the municipal voice is not being heard now.” is also attributed to him. He is further quoted as saying “I believe the ‘local voice’ will be lost if amalgamation is forced for no reason but population. I also believe that elected officials are the best suited to make decisions based on the voice of their ratepayers, not the provincial government.

As of the beginning of May 2013 there had been no public hearing or public meeting to obtain public input into council’s decision on amalgamation. To this point the only attempt to garner ratepayer opinion was the “NOTICE TO THE RATEPAYERS OF SHELLMOUTH-BOULTON” and a petition directed to the ‘Legislative Assembly of Manitoba.’

I find it interesting that Mr. Zimmer complains that ‘no consultations were held’ and raises the issue that ‘the municipal voice is not being heard’. His comment that ‘elected officials are best suited to make decisions based on the voice of the ratepayers’ is particularly concerning. At this point in the process, with no public hearing or meeting having been held, how could council say that they were making decisions based on the voice of the ratepayer? The “NOTICE TO THE RATEPAYERS…” document was only placed in the mail boxes of the ratepayers who received their mail at the Inglis post office. These notices were not sent to ratepayers who receive mail at the community mail boxes outside of Inglis nor were they distributed to ratepayers who receive their mail in Russell or Roblin. The petition was seen on the front desk of the municipal office. It is not know whether council members were asked to poll their ratepayers.

The idea that council was acting on the voice of their ratepayers is further misleading when one considers the actions of council at a special meeting held at 7:00 p.m. on May 6, 2013. Council called this meeting for the expressed purpose of discussing ‘The Municipal Modernization Act’. No notice, in any form, of this meeting was given to the public. In addition to that, council closed the meeting to go ‘in camera’ as soon as the meeting started. We now have a meeting that the ratepayers did not know about that is held ‘in camera’ which, in effect further closes the meeting and prevents councillors from revealing what was discussed.

The Municipal Act allows a council to close a meeting for certain reasons. These reasons include discussing employee matters including; salary, duties and benefits and appraisal of the employee’s performance, the conduct of existing or anticipated legal proceedings, etc. It also allows a council to go ‘in camera’ to discuss ‘a matter that is in its preliminary stages and respecting which discussion in public could prejudice a municipality’s ability to carry out its activities or negotiations’. Council is not allowed to pass a resolution at a closed meeting other than to re-open the meeting. When this council re-opened this meeting, they passed a resolution agreeing ‘to discuss amalgamation with the council of the Rural Municipality of Silver Creek’. While the decision to discuss amalgamation with the RM of Silver Creek could certainly be considered ‘in its preliminary stages’ I am not at all sure how discussion in public could jeopardize the municipality’s ability to carry out its activities or negotiations. The actions of this council appear to be focused on avoiding consultation with the ratepayers. The questions now become ‘why are they doing this?’ and ‘why not hold a public consultation?’

On June 17, 2013 I wrote a letter to the reeve, Mr. Zimmer, expressing my support of the amalgamation concept and encouraging him to consider a larger amalgamation that what was being considered. I also suggested in that letter that public consultation to explore possibilities might be preferred over a unilateral decision by council. I copied this letter to my local council representative, Mr. K. Nerbas and to the then minister of Municipal Government, Ron Lemieux. Neither Mr. Zimmer nor Mr. Lemieux acknowledged receipt of my letter. I discussed the letter and council’s approach to amalgamation with Mr. Nerbas. My letter to council is mentioned in the minutes of the July 10th, 2013 regular council meeting. Although I attended a portion of that council meeting as an observer, I can recall no discussion of my letter or my suggestion that a public consultation be held. It is noted that council closed the meeting to go ‘in-camera’ at 2:20 p.m. No reason is given for why council chose to close the meeting.

On June 29, 2013 I wrote a letter to the editor of the Russell Banner expressing my concern over council’s failure to consult with the public in a meaningful and adequate manner. This letter appeared in the paper on July 16, 2013.

Having heard nothing from council regarding my letter and my suggestions that a public consultation might be appropriate, and given the fact that time was running out, I resolved to approach council and attempt to find out what reasons they had for the approach that they were taking. At this point it was evident that they had decided that an amalgamation with the RM of Silver Creek was the only option being considered. I contacted the council office and was advised that I had an appointment to speak to council on August 14th, 2013 at 11:30 a.m.

On August 14th, 2014 I attended the council meeting at the municipal office in Inglis and asked some questions regarding council’s amalgamation plan. It was at this meeting that the topic of the Town of Russell’s debt was raised. CAO C. Marzoff raised Russell’s debt as a compelling reason for not considering an amalgamation that would include the Town of Russell. I recall her asking me if I wanted my taxes to go up because that would surely be the case if Shellmouth-Boulton was to consider an amalgamation that would include the Town of Russell. CAO Marzoff mentioned the amount of $3.3 million as the amount that would have to be paid off by the ratepayers of an amalgamated municipal entity. I questioned the CAO on this topic as I had learned that this issue had been raised at another meeting and the attendees had been told that this debt would not become the responsibility of the ratepayers of any newly amalgamated partners.

CAO Marzoff produced a copy of the Municipal Modernization Act and drew attention to Section 8(8) of that legislation. It states:

8(8) “On the effective date of the establishment of a newly amalgamated municipality, …

(b) all the debts, obligations and liabilities of the municipalities that are amalgamated become the debts, obligations and liabilities of the newly amalgamated municipality;”

This was held up as a sure indicator that the taxes in the RM of Shellmouth-Boulton would increase as a result of amalgamation. Not being well versed in tax law and the way taxes are applied I was unable to present any argument that would contradict the CAO’s assertion that the $3.3 million would have to be repaid by all ratepayers in a newly amalgamated municipality.

I then posed the question about a public meeting for the purpose of measuring public opinion and sharing information. CAO Marzoff replied that a public meeting, at this point, would be premature as the municipality did not have enough information to share with the public. This position was affirmed by Reeve Zimmer who pointed out that enquiries with the office of the minister of Municipal Government and attempts to get answers from Minister Ron Lemieux had produced little information.

It was mentioned that a public information meeting was planned for the fall of 2013 and that this meeting would be the opportunity for the public to get information on the amalgamation plan. It appeared that council had already made a decision to amalgamate with the RM of Silver Creek and that this decision was made on incomplete and inaccurate information. The total lack of willingness to consult with the ratepayers in an open, public meeting and to share information on how and why they had reached their decision was troubling. It was evident that this council had made a decision absent the ‘local voice’ and ‘the voice of their ratepayers’ mentioned by Reeve Zimmer in the Russell Banner interview in April 2013. The Shellmouth-Boulton amalgamation was shaping up to be a case of “No consultations were held and no reasons were given!” much the same complaint as the one launched against the provincial government by Reeve Zimmer.

In October 2013 meetings were held to inform the public of the amalgamation plans that had been developed by the local municipalities. I attended the first meeting in Russell on October 16, 2013. At this meeting attendees heard of the plan to amalgamate the Town of Russell, the RM of Russell and the LUD of Binscarth.

On October 21, 2013 I attended a similar meeting held in Angusville where the plan to amalgamate the RMs of Shellmouth-Boulton and Silver Creek was presented. It became evident that the amalgamation of these two municipalities was a ‘done deal’. No information was provided to show that alternatives involving other municipalities had been considered. No compelling reasons were presented either for or against an amalgamation with other neighbouring municipalities. When the presenters were wrapping up their presentation, it was mentioned that a ‘Comment Sheet’ was available and attendees were invited to submit their comments on this form. The floor was then opened for questions. It was evident that this type of meeting was going to be the only opportunity for any type of public discussion on the amalgamation issue.

When the opportunity arose I raised the question of the impact of the Town of Russell’s debt on amalgamation partners. I questioned the fact that we had been told that amalgamation partners would be obligated to pay down this debt through increased taxes. I stated that I had information that Russell’s debt could not be spread out to others and that it would have to be repaid by the Town of Russell taxpayers. At this, Reeve Zimmer rose and pointed his finger at me stating “Rod you are wrong. You are wrong.” He went on to repeat the assertion that this debt would surely have a negative impact on the taxes of any municipality that amalgamated with the Town of Russell. Zimmer’s statement was adamant and forceful. It was clear that any further discussion from me on the matter would only stimulate an argument. I returned to my chair to see if any other information would be presented.

Additional questions on the ‘Russell debt’ and other topics were raised. Nothing definitive was stated and the meeting closed. I left the meeting stung by Reeve Zimmer’s accusation that I was wrong on the topic of Russell’s debt.

On October 22, 2013 I met with the CAO of the Town of Russell in an effort to clarify the ‘Russell debt’ issue. CAO W. Melnyk explained that although the Town of Russell did have a debt of approximately $3.3 million, this debt was ‘roll specific’ meaning that it would have to be repaid by the taxpayers of the Town of Russell. I was given to understand that role specific debt stays with the taxpayers on the affected tax role until it is paid off. CAO W. Melnyk was quite clear on the fact that the taxpayers in any municipalities that amalgamated with the Town of Russell would not be obligated to repay Russell’s role specific debt.

During the evening of October 22, 2013, a public meeting was held in the community hall in Inglis. I attended that meeting determined to set the record straight on the topic of the Town of Russell’s debt and its impact on potential amalgamation partners. Prior to the start of the meeting I spoke with Reeve Zimmer and Reeve Dunn from the RM of Silver Creek and advised them of my findings. I had prepared a PowerPoint presentation with some information that offered an alternative to the amalgamation proposal that was being presented. This suggestion caused a bit of a stir and the consultant who had been hired by the province to assist with the amalgamation process, was called over to hear what I was proposing. Bob Brown, who was facilitating the meeting, announced that he would allow questions from the floor but told me that if I attempted to make a presentation of any kind he would not allow it. I informed Mr. Brown and the council representatives that had gathered around, that I had obtained information indicating that the information regarding the Russell debt, as presented at the Angusville meeting and elsewhere, was incorrect. Mr. Brown admitted that what I was stating was correct but stated that he would not include that information in his presentation. He did state that if the question was raised he would answer it appropriately. When I objected to this heavy handed approach, telling him that this was going to be the only opportunity for input from the public, Mr. Brown assured me that he would shut me down if I attempted to make any kind of presentation. It was clear that the decision on how the amalgamation would take place was made and that there was not possibility of any member of the public having any say in the matter.

The meeting commenced and the amalgamation proposal was presented. When the floor was opened to questions I raised the issue of the impact of Russell’s debt on amalgamation partners. Mr. Brown acknowledged that Russell’s debt, being role specific, would not have had an adverse effect on the taxes of ratepayers in municipalities that would have amalgamated with Russell. Several questions were taken from other individuals in attendance. At one point someone suggested that there be a show of hands to indicate who was in favour of the amalgamation proposal. This suggestion was rejected by another attendee who stated that taking a vote at this time would be pointless as insufficient information had been presented to the public on other options. It was clear that the amalgamation decision had been made and that nothing could be done to change the minds of those who had made that decision.