The Town of Newmarket is disbanding its citizen-centred committee that doles out hundreds of thousands each year in grants and interest-free loans to businesses seeking to make improvements on its historic downtown properties.
Council cited new code of conduct rules that subject volunteer members of a municipality’s local boards to the same stringent set of ethical guidelines council itself must adhere to, and the possible perception of conflict of interest due to the committees’ structure, as reasons for the move.
For more than a decade, the Newmarket Downtown Development Committee has reviewed and made recommendations to the town’s chief administrative officer regarding funding application requests under the community improvement plan's financial incentives program.
A core group of about four downtown business/property owners, along with the area councillor and three town staffers, have for at least the past five years presided over applications from downtown business owners for about nine funding programs, including interest-free loans of up to $100,000 for such things as facade improvement and restoration, grants up to $15,000 for interior renovation and improvement, and more.
Since the committee’s terms of reference states its members themselves should be property or business owners in the area, it is possible that the appearance of conflict of interest would be present for the members, a staff report presented to council April 29 states.
“This concern has further weight with the legislated requirement of a code of conduct for committee members, which now applies to Newmarket Downtown Development Committee members,” the report continues. “The potential for the appearance of conflict could represent an unfair burden on the members of the committee who are chosen specifically to represent community improvement plan-area businesses and landowners.”
The concern about the committee’s perceived conflict was raised by Mayor John Taylor after Bill 68, the Modernizing Ontario’s Municipal Legislation Act, 2017, came into effect March 1, 2019, which strengthened codes of conduct for local politicians and also now applies to members of its local boards.
“With the requirement about the code of conduct applying to committees, and largely having business owners on Main Street deciding on grants for Main Street, it puts that committee in a difficult position,” Taylor said. “And I don’t think it’s the best optic to have potentially large grants being granted by a committee where someone may have buildings they own a few doors away.”
Taylor said there’s no suggestion that anyone on the committee has operated that way, and there have been times when a member has declared a conflict.
For example, NewmarketToday found an instance in February 2016, according to committee minutes, where a member refrained from discussing a grant application by a Main Street business owner due to ongoing litigation that member was involved in regarding the use of a lane easement they had outlined in a statement of claim issued to their neighbouring properties, Lake Simcoe Region Conservation Authority, and the Town of Newmarket in April 2014.
But subjecting volunteer members to a robust code of conduct became a concern, town clerk Lisa Lyons said.
“By all means this wasn’t meant to reflect on the work that the committee had done in the past, because it was about how successful this program has been in the community,” Lyons said, adding the committee has been resident-led since about 2006. “We also did a review of other communities who run grant-applications programs similar to this and there are very few that run those programs through a volunteer base,” Lyons added. “They are generally vetted through staff members or through council directly. That was the driving force behind reviewing that and making those recommendations.”
In its committee structure review report, town staff recommended that council dissolve the Newmarket Downtown Development Committee and, instead, establish a staff-led process for the evaluation and approval of community improvement plan grant applications.
A staff working group would provide recommendations to CAO Jag Sharma and could include representatives from the town’s economic development, planning and building services, and financial services departments.
In addition, one other staff representative with demonstrated interest and knowledge on downtown issues could be involved, along with Councillor Bob Kwapis, in whose ward Newmarket’s historic downtown is located.
This five-member group would be responsible for receiving and evaluating the grant applications using existing processes and making recommendations for approval to the CAO, according to the report.
For more information on the town’s recent committee structure review, visit here.
