Bill 203 Summary

This is the brief I circulated via email to my colleagues on May 15th, two days after indicating at the May 13 Council meeting that I would propose a motion related to Bill 203. I am posting it here as a reference item to an accompanying article on campaign finance and disclosure and the blowout at council this past Wednesday when the motion came up for discussion.

Sent: Friday, May 15, 2009 9:36 PM
To: Councillors*; Stephen Mandel
Cc: Councillors EAs & RAs*
Attachments: bill-203.pdf‎ (173 KB‎) [you can download a pdf here]

Following upon the Notice of Motion at last council (see below) I am pleased to circulate a summary of the provisions in Bill 203. It has received two readings and gone to Committee of the Whole.

At the next regularly scheduled meeting of City Council I will move: That the mayor write to all members of the Legislative Assembly of Alberta indicating Council’s support for Bill 203 “Local Authorities Election (Finance and Contribution Disclosure) Amendment Act, 2009 (Johnson)” and requesting that the legislature also enact changes that would enable the tax deductibility of donations to municipal campaigns by private individuals.

Summary of Bill 203
Local Authorities Election (Finance and Contribution Disclosure) Amendment Act
Prepared for Cllr. Iveson by Director of Research Dan Nielsen

Highlights:
• 5,000 individual or corporate donation limit
• Requirements for sound bookkeeping tightened with audit followup
• Disclosure of source of all donations above $100
• Surpluses to be held in trust, turned over to charity or municipality when not running (consistent with our bylaw)
• Fundraising only permitted in year of election
• Severe penalties for failure to comply

The majority of Bill 203 consists of additions that are proposed for “Part 5.1 Municipal Election Finance and Contribution Disclosure” of the Local Elections Act. These additions include defining terms of importance to elections, creating a maximum limit with regards to campaign contributions, the candidate’s bookkeeping responsibilities during a campaign, the disclosure of financial information, determining how surplus campaign funds are held during non-campaign periods, and the penalties for not following the proposed new rules.

Limits on Contributions
In subsection 2, the Bill defines the maximum amount any person, corporation, trade union or employee organization may contribute to a candidate as no more than $5000. If this is exceeded, than a fine of not more than $10 000 for a corporation, trade union or employee organization and not more than $5000 for a person may be imposed.

Bookkeeping Duties
The responsibilities of the candidate include:
• Opening a campaign account at a financial institution in the name of the election campaign for the purposes of the election campaign.
• All monetary contributions must be deposited into this account and can only be used towards the payment of campaign expenses.
• All expenses and contributions must have receipts associated with them.
• Disclosure statements must be filed in accordance with section 147.04.
• Record of the expenses and contributions must be kept for a period of 2 years following the date on which the disclosure statements were required to be filed.
• Contributions of real property, personal property and services are to have a value and must be reported.
• If a contribution is found to be in breach of this Act, then it must be returned as soon as possible once the candidate has become aware of the violation.
• The candidate’s official agent and anyone else authorized to incur campaign expenses or accept contributions must be properly directed with regards to these responsibilities.
• Finally, any contributions found to be in violation of this Act, and cannot be returned due to conditions of anonymity or otherwise, will be paid to the secretary for the municipality for where the election is held.
The duties outlined in subsection 3 state that if not followed, can face a fine of up to but not more than $1000.

Disclosure
A candidate is required to file disclosure statements with the municipality on or before March 1 immediately following a general election, on or before 120 days following a by-election. The disclosure statement must include:
• The total amount of all campaign contributions received during the campaign period that did not exceed $100 in the aggregate form from any single contributor.
• If any single contributor contributes over $100, the total amount of the contribution along with information including names and addresses must be submitted.
• A complete list of campaign expenses.
• If the statement has changed or not complete, the candidate has 30 days to submit a supplemental form.
• If the campaigns expenses exceed $10 000, then an audit of the statement must take place.

Surplus
If the candidate’s disclosure statement exceeds $500, Campaign surpluses will now be paid to the municipality on or before March 1, immediately following a general election or on or before 120 days following a by-election.
• The municipality will then hold the money in trust at a financial institution and if the candidate files nomination papers to be a candidate for the next general or by-election, the money will be repaid to the candidate with interest at a rate prescribed by the Lieutenant Governor in Council for use in that election.
• If the candidate for whom the money is held in trust does not file papers to become a future candidate, the money with appropriately calculated interest will be donated to a charity of their choice. If no charity has been chosen, the money with interest becomes the property of the municipality.

Penalties
The penalties for breaching the proposed rules include:
• A candidate is liable to a fine of not more than $5000 if they do not abide by sections 147.04, 147.05 or 147.06 and fails to comply with any of the aforementioned sections within 30 days after the time period provided in that sections and does not pay the municipality the late filing fee of $500.
• In addition to any penalty mentioned in this Act, if a person elected to council fails to file a disclosure statement in compliance with section 147.07 and 147.07, and has not been removed in accordance with section 147.08, then the person ceases to hold the office as a councilor, and the seat is deemed to be vacant.

The definitions that are of most significance are: “campaign contribution”, “campaign expense”, “campaign period”, “candidate”, and “prohibited organization”. The Bill makes minor amendment to section 118 with the addition of detail to clarify the intended meanings of “authority” and expenses”. (See attached Bill.)

Don Iveson
EDMONTON CITY COUNCILLOR, WARD 5
1 Sir Winston Churchill Square, Edmonton, AB T5J 2R7
780.496.8132

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