An editorial (Gazette, Feb. 1) about my motion to reduce council’s insurance policy to cover items related strictly to city business rather than pecuniary interest matters has missed key points. My motivation for such a motion is to improve adherence to the municipal act in order to provide better governance and accountability for residents of St. Albert.
If a financial conflict of interest, or pecuniary interest arises, a councillor is required by the MGA to (a) declare his pecuniary interest, (b) abstain from voting on the matter; (c) abstain from any discussion on the matter, and (d) leave the room. All councillors are aware of their financial interests and voting on a matter that affects them financially is rarely a result of “error or omission,” which is what liability insurance is designed to protect against.
Section 179 of the Municipal Government Act states “The council may reimburse the person in respect of whom an application under this Division was made for any costs and expenses that the council considers reasonable, other than costs that have already been awarded to the person by the judge, if (a) the application is dismissed, or (b) an order is issued declaring the person able to remain a councillor.” From this, it can be understood that only if and when the person is ruled innocent or ruled that they can remain on council, that they should be entitled to have his/her legal fees reimbursed, and not prior to the judge’s ruling.
It is my understanding that in other jurisdictions, it is common to have the politician pay for his/her own legal fees regarding pecuniary interest violations and these costs are only repaid if declared innocent, adhering to the Municipal Government Act. That is not occurring in St. Albert, where the full legal fees are being covered upfront through the city’s insurance policy for pecuniary interest violation defences. If there are no real consequences to voting on matters of financial conflict of interest, what motivation is there to stop an individual from deliberately ignoring and violating the Act?
Pecuniary interest applications are not full lawsuits, and do not require a full trial. The potential penalty is not financial, but removal from office, and, if the elected official is declared innocent or the judge does not consider the breach serious and does not remove him/her from office, the municipality is then entitled to reimburse that official for his/her legal expenses.
The backgrounder stated that “faced with the prospect of incurring upfront legal expenses, [councillors] may be far more inclined to recuse themselves.” By stating that councillors are and should be responsible to pay their own legal fees for cases of pecuniary interest only, it would encourage due diligence on the part of all. I hoped it would have resulted in all councillors thinking carefully before choosing to vote on matters that may directly affect them financially, instead of using the city insurance policy to cover any of the financial consequences of a violation.
Cam MacKay, St. Albert
Editor’s note: The city backgrounder authored by Gene Klenke, city solicitor states: “Notwithstanding potential reimbursement of Council members in accordance with a policy statement enshrining MGA section 179, the proposed motion may have the effect of subverting the fundamental governance role of elected representatives, who, faced with the prospect of incurring significant (upfront) legal expenses, may be far more inclined to recuse themselves. Though the MGA defines the nature of pecuniary interest, approval of this motion may cause Council members to be overly cautionary about the interpretation of the term. Insurance coverage allows Council members to consider and evaluate, without this distraction, whether they may have a pecuniary interest in a particular matter.” The full text of Klenke’s Jan. 23 backgrounder is available on the City of St. Albert website. It is called City of St. Albert Administrative Backgrounder Insurance Coverage for Pecuniary Interest.
