RFD-3635     Bylaws    Item #   9. c.            
Regular Council Meeting Agenda
Meeting Date: 09/09/2019  
Title: C-1084-19 - First and Second Reading - Council Code of Conduct Bylaw - Frostad
Department: Corporate Services
This topic relates to all three of the City’s strategic vision elements contained in Council’s Strategic Plan

Request for Decision Summary
The Council Code of Conduct bylaw has been updated to include provisions for the acceptance of gifts. Previously, the acceptance of gifts was addressed separately in a corporate policy. At this time, first and second of the bylaw is requested of Council. 

Proposed Motion
That first reading be given to Bylaw C-1084-19 - Council Code of Conduct Bylaw.
That second reading be given to Bylaw C-1084-19 - Council Code of Conduct Bylaw.
Council passed C-1043-18 – Council Code of Conduct Bylaw on July 16, 2018. Provisions regarding the acceptance of gifts by Council and Administration is addressed in Corporate Policy 9,044 – Gift and Gratuities. Administration is currently drafting an Administrative Policy on Employee Code of Conduct that would address the receipt of gifts and gratuities by staff. Consequently, Corporate Policy – 9,044 – Gift and Gratuities will become redundant for employees, and would leave the policy only applicable to Council. Since all provisions related to ethical conduct for Council are in the Council Code of Conduct Bylaw, it would be more streamlined to address direction related to gifts and gratuities in the bylaw.

At the October 15, 2018 Committee of the Whole meeting, Council provided input on provisions regarding gifts and gratuities. The input provided included:

1. That there be a disclosure requirement to report all gifts.

What was done: Gifts can include nominally valued items, such as hospitality related food and drink, and therefore reporting all gifts may be overly onerous. In an effort to make the reporting process less difficult and cumbersome, and to ensure transparency, Section 10.5 of the bylaw indicates that receipt of gifts that carry a value in excess of $50 shall be reported to the City Clerk and the report will be a matter of public record. Assigning a dollar value of $50 ensures that any substantial or material items will need to be reported, while token or minor gifts that are typically part of social obligation such as most hospitality items are excluded.

Please note that this value cut-off of $50 only applies to the reporting of gifts. The value cut-off for the acceptance of gifts is still $300.

2. Explore what to do with gifts to Council members.

What was done: Administration looked at 10 other municipalities’ approach (Airdrie, Edmonton, Fort McMurray, Fort Saskatchewan, Medicine Hat, Parkland County, Red Deer, St. Albert, Stony Plain, Strathcona County). The approach recommended for Spruce Grove, as indicated in Section 10 of the bylaw, touches on the most common elements of direction provided in other codes of conduct in the municipalities surveyed. Please see attachment for details.

One area that not many municipalities touched on was what to do with a gift that exceeded the acceptance allowance value. One could infer from the Council Code of Conduct Bylaws of these other municipalities that Councillors were expected to always refuse a gift over the acceptance allowance; however this is not always practical. Therefore, Section 10.2 of the bylaw indicates that acceptance of gifts with a value exceeding $300 should either be rejected or if accepted, donated to a non-profit organization. Donation of the gift over $300 ensures that a Councillor is not put in a potentially awkward position where they have to refuse the gift, and allows the Councillor to graciously accept the gift on the understanding that it will be donated.

3. How to determine value of gifts.

What was done: A provision on the procedure to value gifts was not included because there can be many different ways, depending on the gift, for obtaining a value, and all scenarios cannot be contemplated in a bylaw. The bylaw is intended to provide high-level ethical guidance rather than very specific procedure. In interpreting specific sections of the bylaw, the entire spirit and intent of the bylaw should be taken into consideration. For example, Section 2(f) provides this guidance: "Councillors shall conduct themselves in a manner that promotes public confidence and will bear close public scrutiny”. In selecting the value of a gift, the test could be in the Council member selecting a valuation method that promotes public confidence and would stand up to public scrutiny. It is thus left to the judgment and discretion of the Council member on how the value is determined. 

4. Clarify gifting interaction with a Councillor if the business providing the gift is owned by a Councillor; or if the gift is to the business owned by the Councillor.

What was done: Rather than including specific instances or examples of situations that raise ethical questions, Council members should take the entire bylaw into consideration in addressing such ethical situations. Section 2 provides general guidance and Section 9 speaks to conflicts of interest. These sections should be reviewed together with the new section 10 on acceptance of gifts.

5. If a gift over $300 is received, can the Council member pay the difference?

What was done: The bylaw as recommended would not allow for the Council member to keep the gift valued over $300. If the value of the gift is over $300, then it must be either refused or donated. Paying the difference does not change the value of the gift. The value cut-off is not intended to be a subsidy or a benefit. The value cut-off is intended to recognize that Council members may occasionally be invited to events, such as fundraisers, or be provided with a gift as part of their duties, and allows the Councillor to accept the gift provided it falls below the acceptance value cut-off.
Council may choose to amend the proposed C-1084-19 - Council Code of Conduct Bylaw so that the disclosure requirement is to report all gifts and/or to make any other further amendments to the bylaw. 

Any changes requested will be incorporated into an amended draft bylaw for third reading and brought back for Council's consideration at a later date. 
The addition of the section pertaining to gifts was reviewed by legal counsel. The proposed C-1084-19 - Council Code of Conduct Bylaw was reviewed internally by Executive Leadership Team and the City Clerk.
If first reading and second reading of the bylaw is passed, and no further amendments are desired of the bylaw, Administration will return to Council for third reading on September 23, 2019.

Administration is currently finalizing the Administrative Policy on Employee Code of Conduct. When this is done, and Council has passed the proposed C-1084-19 - Council Code of Conduct Bylaw, Administration will return to Council to rescind Corporate Policy 9,044 - Gifts and Gratuities.

Providing provisions and clarity within the Council Code of Conduct Bylaw around the acceptance and reporting of gifts will further enhance Council's transparency and accountability. 

C-1084-19 Council Code of Conduct Bylaw - Clean Copy
C-1084-19 Council Code of Conduct Bylaw - Redlined
Muncipal Survey - Code of Conduct Gift Receipt Provisions