Second Councillor in Conflict of Interest
Municipal councils operate under rules designed to ensure that elected officials make decisions in the public interest. One of the most important of these rules is Ontario’s Municipal Conflict of Interest Act (MCIA), which requires councillors to declare and step away from discussions when they have a financial interest in a matter before council.
To help enforce these rules, municipalities must appoint an Integrity Commissioner. This independent official reviews complaints, investigates potential breaches, and reports their findings publicly.
In South Algonquin, Integrity Commissioner Tony Fleming of Cunningham Swan Lawyers investigated a complaint involving a second Councillor. The report was provided to council and included in the November 1, 2023 council agenda package.
The Complaint
The complaint concerned events that occurred during the June 20, 2023 council meeting.
According to the Integrity Commissioner’s report, the issue before council involved discussion about the regulation of short-term rental accommodations.
The complaint alleged that the councillor had a financial interest in the matter because he operates a property management business connected to short-term rentals. The business includes services such as advertising rental properties, booking rentals, cleaning, and property maintenance for those properties.
The allegation was that the councillor should have declared a pecuniary interest and refrained from participating in the discussion.
During the investigation, the Integrity Commissioner reviewed written submissions, interviewed witnesses, and examined the video of the June 20 council meeting.
What Happened at the June 20 Meeting
The report states that the councillor participated in the discussion about short-term rental regulation and did not declare a pecuniary interest.
During the meeting, the councillor briefly left the room and contacted the Integrity Commissioner’s office to ask whether he had a conflict of interest in the matter.
According to the report, the Integrity Commissioner’s office advised that he did have a pecuniary interest and should declare the conflict and not participate in the debate or vote.
Despite receiving that advice, the councillor returned to the meeting and continued participating in the discussion.
In his response to the complaint, the councillor acknowledged that he participated in the debate. He argued that because the discussion did not involve a by-law and no vote was taken, he believed he could take part in the conversation.
The Integrity Commissioner noted that the Municipal Conflict of Interest Act does not allow participation in any discussion or decision-making process, regardless of whether a vote takes place.
Findings of the Integrity Commissioner
After reviewing the evidence, the Integrity Commissioner concluded that the councillor breached the Municipal Conflict of Interest Act.
Specifically, the report found that the councillor violated Section 5(1)(b) of the Act by participating in discussion about a matter in which he had a pecuniary interest.
The report also concluded that the same conduct breached the municipality’s Code of Conduct, which requires councillors to avoid participating in decisions when they have a disqualifying financial interest.
Recommended Penalty
Under the Municipal Conflict of Interest Act, an Integrity Commissioner can apply to a court to seek penalties such as removal from office. In this case, the report concluded that such an application was not necessary. Because no vote occurred, the Commissioner stated that a court would likely impose a financial penalty rather than removing the councillor from office.
The report found that the councillor had a pecuniary interest because his property management business is connected to short-term rentals. It also concluded that he continued participating in the discussion after receiving advice from the Integrity Commissioner’s office that he should declare a conflict and not participate.
The Integrity commissioner described this as a serious breach and recommended that council impose a 15-day suspension of Councillor Pigeon’s pay under the municipality’s Code of Conduct enforcement powers. The report also noted that the councillor had received clear advice from the Integrity Commissioner during the meeting but chose to participate in the discussion anyway, which was a factor in recommending a penalty.
Council was required to accept the report and formally acknowledged that a breach occurred. They declined to implement the recommended consequence for the behaviour.
Why This Matters
Conflict of interest rules exist to protect public confidence in municipal decision-making. They ensure that councillors do not participate in discussions where personal financial interests could influence policy decisions.
In this case, the Integrity Commissioner concluded that the rules had been breached and recommended a financial penalty to reinforce their importance.
Council’s decision to accept the findings while declining the recommended consequence leaves the formal breach on record, but without the enforcement mechanism the Integrity Commissioner believed was necessary to reinforce the standards set out in provincial law and the township’s Code of Conduct.
Observers may take away new knowledge about how municipal accountability systems work — and how their effectiveness ultimately depends on the choices made by council itself.
