Chestermere city council on the firing line, awaiting report into 'dysfunctional' governance

The seven members of Chestermere city council — facing potential firing and other sanctions — will hear the results of a months-long investigation into allegations of inappropriate conduct today in a private, closed-door meeting.

It's been one year since Jeff Colvin was elected mayor along with six other members of council, and it didn't take long for a series of controversies to erupt in the bedroom community east of Calgary.

A deep divide among council emerged almost immediately after the election. Colvin and three councillors have been able to successfully pass a number of initiatives, outvoting the other three members of council.

Just four months after the election, the three members of council who often found themselves in the minority pleaded with the provincial government to intervene and investigate the actions of the mayor and the other councillors.

The province took the concerns seriously.

It launched a preliminary review in February that sparked a full investigation, which then prompted the appointment of a special administrator to oversee every move that council makes and every decision it approves until at least the end of January.

Mayor Colvin says council is functioning well despite his belief that the three councillors who complained to the provincial government are "undermining" the group.

He claims their comments to the government are a breach of council's code of conduct and the three should be  sanctioned.

"False statements and outright lies have been brought forward to either the public or to Municipal Affairs," Colvin told CBC News in a lengthy sit down interview last month.

Ric McIver, the former minister of municipal affairs, referred to council as a dysfunctional group shortly before his portfolio was handed to fellow Calgary MLA Rebecca Schulz.

The Municipal Affairs investigation, carried out by long-time municipal governance consultant George Cuff, included dozens of interviews with current and former employees along with the seven members of council.

Today, councillors are expected to hear the results of that investigation and any possible recommendations aimed at improving local governance. One of Cuff's options is to remove some or all members of council.

Cuff declined an interview request as his report has yet to be delivered to council. That is expected to happen this afternoon behind closed doors. The document must be made public, but it's unclear when that will happen.

Sources have told CBC News that they complained to Cuff about a toxic workplace, multiple dismissals, forced resignations, cronyism and a lack of due diligence and proper procedure during decision-making.

It's unclear whether Cuff's report will address those complaints or make any findings about those concerns.

CBC News has agreed not to identify them as some have signed non-disclosure agreements following their dismissal or they worry that speaking out could jeopardize a future claim against the city for wrongful dismissal.

McIver's order signed in May specifically outlined five concerns.

• Members of council acting alone and outside of a council resolution.

• The complaints process for code of conduct infractions.

• Members of council performing administrative functions and duties.

• Improper council meeting procedures and conduct.

• Sale of municipal property not in accordance with the Municipal Government Act.

The election

Chestermere is located immediately east of Calgary. It has grown rapidly in recent years and is now a city of nearly 21,000 people.

On Oct. 21, 2021, almost a third of the 15,405 eligible voters cast a ballot for mayor and six councillors. Colvin, an entrepreneur, former builder and developer and newcomer to local politics, was elected mayor with nearly 3,000 votes.

Chestermere election results, Oct. 2021

Colvin is the founder of Regional Water Enterprises and is listed as the president of the company that supplies drinking water services outside of Calgary.

Incumbents Ritesh Narayan and Mel Foat were re-elected.

Hostile takeover

Sources say that after the election, a number of employees were dismissed or resigned and a new management structure was put in place. They described it as a hostile takeover, something similar to what you'd see in the corporate world.

Bernie Morton was the city's chief administrative officer for just over three years. He left that position immediately after the election. He declined an interview request.

Under provincial legislation, every municipality must hire at least one person to act as the administrative head. The CAO acts as council's adviser on its operations and affairs and is responsible for the administration, operation, financial management and human resource management of the municipality. The CAO is also responsible for the implementation of council's decisions.

Colvin and the rest of council approved a new administrative model, moving away from a single CAO to three city directors.

He says the "restructuring" caused significant change after a review of city departments.

"How are the staff set up? Do staff want to proceed with the kind of vision that we have?"

"So some staff indicated that they did not and that's their choice if they wish to work here or not, but a total of approximately 25 per cent of our staff has been restructured."

Sources say the city had approximately 140 employees at the time of the election. Colvin would not confirm the current number of employees.

City director Kim Wallace disputes the comparison to a hostile takeover.

"Suggesting we are working in an environment that is similar to a hostile takeover is not true at all and sounds unnecessarily inflammatory," she said Wednesday in an email.

Wallace says administration required staff to return to work as COVID-19 restrictions eased, but some employees on short-term stress leave or paid leave chose not to return.

"So, no, it is not a hostile work environment, in fact our staff are flourishing and are excited about their opportunities within our organization. Do we have challenges as we grow and change? Of course, but what organization doesn't?"

Along with Morton, a number of people have since left, including the chief financial officer, a director of community operations, the head of human resources, the head of IT, a spokesperson for the city, a chief of staff to the CAO, the director of community safety and a senior planner.

A union drive shortly after the election was successful. However, the Canadian Union of Public Employees has not yet negotiated a first contract with the city, according to CUPE spokesperson Lou Arab.

Following Morton's departure, as many as five people have shuffled through the position of interim CAO, as the new three-person director model is still being implemented.

Wallace, who worked on Colvin's election campaign, was later hired as chief of staff but is now the acting director of corporate services. Her company, Oliver Spence Creative, which is run by her husband and business partner, has since been contracted by the city to provide information technology services.

"We have followed the city's policies on spousal relationships within the city. It is not relatable though, as it [is] our company that is contracted to the city," Wallace said in an email to the CBC.

The payouts, the investigation

Since the election, a number of investigations have been launched by city council. One of them involves payouts to two former employees who received a combined $600,000.

It's unclear who received the severance packages.

"The information was that this was transferred electronically and it was done without the consent of the council or mayor, and didn't follow any proper process," said Colvin.

"This was way above what these people should have received," he said.

Council voted unanimously to hire an outside party to investigate.

"The people that transferred the funds are not employed by the city any further," he said.

Land sale

One of the issues the minister raised when he ordered the investigation was the sale of municipal property.

It relates to the sale of nearly 40 hectares of land known as the Webster lands.

Colvin posted a picture of a cheque on social media that he received for a deposit on the land.

In a letter to Municipal Affairs, the three councillors said Colvin "unilaterally negotiated and signed a sale/purchase agreement" without discussing "the agreement with council or seeking the ratification of the agreement by council."

The mayor says the allegation is not true and that council later agreed to accept the purchase contract subject to legal review.

Alleged code of conduct violations, investigation

The mayor has accused councillors Ritesh Narayan, Sandy Johal-Watt and Shannon Dean of breaching the city's code of conduct.

Colvin says the three broke the rules 100 times. Narayan alone is being cited for 50 alleged violations.

All three councillors have declined interview requests. One of them said they were afraid to speak to the media, fearing it could trigger more violations.

None of the other councillors would speak to CBC News, saying that Colvin is the only spokesperson for council.

"Thank you for expressing an interest in our community. Unfortunately, I feel that this would not be appropriate at this time," wrote Stephen Hanley in an email to CBC News.

Colvin presented a report to council in September, claiming he had enough evidence to trigger a third party investigation of his colleagues. The investigation was approved by a majority of council.

Immediately following that decision, the minister appointed an official administrator to oversee council. A statement from his office said action needed to be taken after becoming aware of "escalating dysfunction."

"I am deeply troubled by the continued escalation of conflict within council," McIver wrote in a letter to the mayor.

"The use of the code of conduct in this manner, and to this magnitude, indicates a degree of intra-council conflict that I believe puts at risk council's ability to govern effectively in the best interests of your residents," he said.

Mayor's presentation of findings sparks privacy concerns

During the Sept. 27 meeting when Colvin presented his findings outlining the alleged code of conduct violations, a number of private citizens' emails were publicly displayed on screen in council chambers and online.

Aimee Essington was one of them. Her email to Coun. Narayan was shown, including her email address.

Essington, who was a member of the city's police communications committee, was concerned an RCMP presentation to council was not being added to council's agenda and expressed her concerns to Narayan.

That email became part of the mayor's findings against Narayan for an alleged conduct violation.

"It was literally like a couple of sentences," she said.

"And that was it. And supposedly that's evidence against Ritesh, that he's swaying the public, which just makes me annoyed."

Local resident Matt Sywenky, who was watching the meeting online in real time, saw the alleged breach and notified the people whose emails were shown along with members of council.

Sywenky says he received an email from the mayor stating that he is in breach of privacy legislation and would be reported to the privacy commissioner. The mayor advised him to "cease and desist."

"I'm notifying the people that their information is out there in public, but I'm to blame for pulling a publicly available document off the City of Chestermere website?" Sywenky said.

The Office of the Information and Privacy Commissioner confirms the city reported the alleged breach.

Next steps

The official administrator's appointment was announced on Sept. 28, the day after the alleged privacy breach at city hall. Douglas Lagore will remain in that role until Jan. 31, 2023.

Lagore must approve certain bylaws or resolutions of council before they can take effect. He can also disallow any bylaw or resolution within 30 days after it's passed.

A request for an interview with the administrator was declined.

READ |The minister's order appointing the administrator:

Municipal Affairs says Chestermere council will have a chance to review the investigation report and provide feedback to the minister before she makes any "appropriate adjustments."

City director Wallace says the city will have 30 days to respond to the report and provide "further evidence" as required.

She says the report will then be finalized by Municipal Affairs and then released to city council and the public.

Colvin isn't sure what to expect, but he knows council is on the firing line.

"If we were let go, I would still run again," said Colvin.

"We're not looking to get fired."

"I only ran because I'm interested in trying to help the community, and looking into change is tough, trying to clean up the city is tough," he said.

Bryan Labby is an enterprise reporter with CBC Calgary. If you have a good story idea or tip, you can reach him at bryan.labby@cbc.ca or on Twitter at @CBCBryan.