Leeds and Thousand Islands Township found in contravention of Municipal Act

The Ombudsman of Ontario has completed an investigation into allegations of an improper discussion and vote in a closed meeting held by the Council for the Township of Leeds and the Thousand Islands with regard to a proposed broadband internet network, and subsequently released the report of his findings on Tuesday, Apr. 5, 2022.

In a Council meeting held on August 11, 2020, the Township’s Broadband Working Group lead presented a slideshow at approximately 6:35 p.m. in open session, outlining the broadband project history, its present status, and the next steps, according to the Ombudsman’s documents. This included information about submitting an application for funding to the province’s Improving Connectivity for Ontario (ICON) broadband project funding program, for which applications were due on August 20, 2020.

In 2019, Council approved funding for a study to determine the approximate cost and timeline to deliver broadband internet across the Township. The Township retained a company specializing in telecommunications network construction to prepare the study.

The study report contained a roadmap for the implementation of a broadband internet network throughout the Township, outlined costs and physical network details, and presented a network design unique to the Township’s topography. The report also set out a sample rollout framework with priorities, budgets, business models, and schedules. Those details were intended to assist Council in determining whether it could proceed with a public-private partnership to create a municipal internet utility.

During the August 11, 2020 meeting, Council reviewed, in open session, a planning report drafted by the Director of Planning. The report presented to Council noted that the study report contained financial and proprietary information that would compromise partnership negotiations if made public. The planning report also discussed the ICON funding process, as well as a high-level summary of the study results, and a series of recommendations for Council.

According to the Ombudsman, around 7:40 p.m., Council unanimously adopted those recommendations and voted to receive the planning report as information, recognize the importance of providing a reliable broadband network, accept the study results, and authorize staff to proceed with a request for proposals to seek a project partner and pursue funding options.

Council then resolved to go into closed session at 7:41 p.m., and, in relation to the broadband internet project, cited the exception at s. 239(2)(i) of the Municipat Act, 2001, which pertains to discussions about information provided to a municipality by a third party.  Under the Municipal Act, 2001, all meetings of a council, local board, and committees of either must be open to the public unless they fall within prescribed exceptions. No description of the general topic to be discussed was noted in the resolution to move into a closed session.

In the closed session, the Broadband Working Group lead presented the results of the study, and council discussed the project and costs associated with moving forward. Council also discussed the Township’s application for ICON funding, including how much of a financial contribution from the Township that Township staff should indicate council would support, should the funding be received.

Council returned to open session around 8:46 p.m. and did not mention the internet broadband project again before adjourning the meeting at 8:53 p.m.

The Township submitted an application for ICON funding on August 18, 2020, one week after the closed meeting. The application reflects a municipal contribution of $3 million. According to the Ombudsman’s documents, Council did not discuss the application further after the closed session on August 11, 2020.

Members of the Ombudsman Office’s open meeting team reviewed relevant portions of the Township’s by-laws and policies, as well as the Municipal Act, 2001. They reviewed the meeting records, including the agenda and minutes, and interviewed all members of Council who were present at the August 11, 2020 meeting. Also interviewed were the Chief Administrative Officer, the Director of Planning, the Director of Community and Business, and the Internet Broadband Working Group lead, who is a resident of the Township. The office received full cooperation in this matter, according to the Ombudsman’s Office.

The reasons for the exceptions, which allow for closed sessions, were analyzed by the Ombudsman’s Office, and it was found that, for some of the closed session content, the exceptions did not apply.

In discussing the application for the ICON funding, the Office stated that there is no clear or potential monetary value in the numbers listed in the ICON application or in the amount that council indicated it would consider contributing to the project. The test to prove an exemption requires that the information have real or potential monetary value, such that disclosure would deprive the municipality of that value. Therefore, the criteria for exception was not met in this matter, the Ombudsman found, and these details should have been provided at an in-camera session, not a closed session.

“I am not satisfied that the information about how much the Township might contribute to the internet broadband project has any intrinsic monetary value,” said Paul Dubé, Ontario Ombudsman, in his finding.

As well, during the interviews, the interviewers were told that Council’s discussion focused on the financial contribution that staff should indicate in the ICON application, rather than any current or future negotiations with potential project partners. Future negotiations can be cited as an exemption to in-camera discussions in order to protect information that could undermine a municipality’s bargaining position in negotiations. However, criteria need to be met, including proof that future negotiations will in fact take place.

The Ombudsman found that the application for funding was not a negotiation with the funding body, and the Township was not engaged in negotiations with any other party with respect to the content of its application. In this case the exemption does not apply.

The Ombudsman’s office also looked at parsing the discussions. In some instances, subject matter cannot be functionally separated and therefore must only be discussed in a closed session, if the matters relate to a discussion on a single topic, and if splitting the information would require unreasonable interruption to the conversation.

“In this case, the discussions relating to the study and the Township’s detailed plans for its municipal internet broadband utility can be distinguished from the discussion relating to the ICON application funding and the amount council wished to contribute to the global cost of the project,” Dubé stated. “Based on members’ recollections of the meeting, the funding application was its own topic during the closed session and was not interwoven with the rest of council’s discussion. One member of council we interviewed even thought that the funding application had been discussed during the open portion of the meeting.”

Dubé provided the following resolutions for the Township:

Recommendation 1

All members of council for the Township should be vigilant in adhering to their individual and collective obligation to ensure that the municipality complies with its responsibilities under the Municipal Act, 2001 and its procedure by-law.

Recommendation 2

The Township of Leeds and the Thousand Islands should ensure that no subject is discussed in closed session unless it clearly comes within one of the statutory exceptions to the open meeting requirements.

Recommendation 3

The Township of Leeds and the Thousand Islands should ensure that its in-camera votes, including a vote by consensus, comply with s. 239(6) of the Act. In order for council to vote in closed session, it must meet the requirements under s. 239(6) and the meeting must have been properly closed.

Recommendation 4

When proceeding in-camera, the Township of Leeds and the Thousand Islands should pass a resolution that clearly sets out the fact of the closed meeting and the general nature of the matters to be discussed.

The Ombudsman’s Office also recommended that the full report on this matter be published on the Township of Leeds and the Thousand Islands’ website.

“The Township failed to meet its obligation to provide the general nature of the matter to be discussed in the resolution to go into closed session,” Ombudsman Dubé concluded. “This is particularly unfortunate considering that I have addressed this issue with the Township in the past… In accordance with s. 239.2(12) of the Municipal Act, 2001, council is required to pass a resolution stating how it intends to address this report.”

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