Municipal Transparency and Council Remuneration (Continued)
Websites have revolutionized the way municipalities communicate, giving easy access to council meeting minutes, webcasting meetings (where available), bylaws and a variety of other information, provided municipalities upload such information to their websites.
The City of Vancouver is the largest municipality in BC, with expenditures of $1.34 million in 2014. Rather than just posting a SOFI for the previous year, Vancouver provides an easy-to-find disclosure of the Council members’ current remuneration rates and a detailed breakdown of each expense. See detailed City of Vancouver council expenses. The Mayor and Council expenses can be viewed in three formats, including Excel.
The public are entitled to know the remuneration and expense information of council members, so why don’t smaller councils make that information more readily available? If Vancouver can do it, why can’t our local municipalities? Placing public information on municipal websites would also save staff time dealing with Freedom of Information requests.
Canada Revenue Agency rules allow municipal council members to receive 1/3 of their council remuneration tax-free.
Most councils have policies or bylaws that provide for the direct reimbursement of expenses that members incur in council duties, such as attending conferences, travel outside the local area, training courses, etc. These reimbursements are legitimate, and are not included in the 1/3 tax-free portion of their remuneration. But should council members take 1/3 of their remuneration tax-free just because they can? The average person doesn’t get this benefit.
There are notable exceptions where council remuneration is fully taxable (not just out-of-pocket expenses or allowances). Two such councils are:
Vancouver City Council - where remuneration is fully taxable
Victoria City Council – in 2009, Victoria City Council removed the 1/3 tax-free benefit.
Kudos to Victoria and Vancouver councils in foregoing the 1/3 tax-free exemption.
It's reasonable to ask why other councils don’t follow these examples. If an ordinary citizen travels in the course of their employment activities, they are reimbursed, but they don't receive 1/3 of their regular income tax-free and they are expected to pay for their way to work. Why should local elected officials receive anything for travel within their municipality?
Also, some councils (e.g. Saanich) don't readily disclose the fact that 1/3 of their remuneration is tax-free. It is necessary to dig to find this out. See Saanich SOFI – Page 31, which simply lists Renumeration and Allowance for Incidental Expenses, but doesn't separate or explain that 1/3 is tax-free.
Oak Bay Council also receives 1/3 tax-free, but at least the Oak Bay SOFI (Appendix C) separates these two portions into Remuneration (taxable) and Benefits (non-taxable).
Finally, after taxes, Saanich Councillors actually earn more (net) than their counterparts in Victoria, yet Victoria Councilors must grapple with the challenges of the region’s core, (e.g. homelessness, more intense policing issues, etc.) and managing a larger budget.
This post is not intended to disparage local elected officials or the work they do on behalf of their fellow residents. However, they should always strive for transparency and take the high road by emulating best practices (such as Victoria and Vancouver) with a view that residents don't have the same opportunity to receive tax-free income from employment.
Changes to council remuneration should be dealt with locally and transparently through council motions, and residents must have an opportunity for input.
- Colin Nielsen
Websites have revolutionized the way municipalities communicate, giving easy access to council meeting minutes, webcasting meetings (where available), bylaws and a variety of other information, provided municipalities upload such information to their websites.
The City of Vancouver is the largest municipality in BC, with expenditures of $1.34 million in 2014. Rather than just posting a SOFI for the previous year, Vancouver provides an easy-to-find disclosure of the Council members’ current remuneration rates and a detailed breakdown of each expense. See detailed City of Vancouver council expenses. The Mayor and Council expenses can be viewed in three formats, including Excel.
The public are entitled to know the remuneration and expense information of council members, so why don’t smaller councils make that information more readily available? If Vancouver can do it, why can’t our local municipalities? Placing public information on municipal websites would also save staff time dealing with Freedom of Information requests.
Canada Revenue Agency rules allow municipal council members to receive 1/3 of their council remuneration tax-free.
Most councils have policies or bylaws that provide for the direct reimbursement of expenses that members incur in council duties, such as attending conferences, travel outside the local area, training courses, etc. These reimbursements are legitimate, and are not included in the 1/3 tax-free portion of their remuneration. But should council members take 1/3 of their remuneration tax-free just because they can? The average person doesn’t get this benefit.
There are notable exceptions where council remuneration is fully taxable (not just out-of-pocket expenses or allowances). Two such councils are:
Vancouver City Council - where remuneration is fully taxable
Victoria City Council – in 2009, Victoria City Council removed the 1/3 tax-free benefit.
Kudos to Victoria and Vancouver councils in foregoing the 1/3 tax-free exemption.
It's reasonable to ask why other councils don’t follow these examples. If an ordinary citizen travels in the course of their employment activities, they are reimbursed, but they don't receive 1/3 of their regular income tax-free and they are expected to pay for their way to work. Why should local elected officials receive anything for travel within their municipality?
Also, some councils (e.g. Saanich) don't readily disclose the fact that 1/3 of their remuneration is tax-free. It is necessary to dig to find this out. See Saanich SOFI – Page 31, which simply lists Renumeration and Allowance for Incidental Expenses, but doesn't separate or explain that 1/3 is tax-free.
Oak Bay Council also receives 1/3 tax-free, but at least the Oak Bay SOFI (Appendix C) separates these two portions into Remuneration (taxable) and Benefits (non-taxable).
Finally, after taxes, Saanich Councillors actually earn more (net) than their counterparts in Victoria, yet Victoria Councilors must grapple with the challenges of the region’s core, (e.g. homelessness, more intense policing issues, etc.) and managing a larger budget.
This post is not intended to disparage local elected officials or the work they do on behalf of their fellow residents. However, they should always strive for transparency and take the high road by emulating best practices (such as Victoria and Vancouver) with a view that residents don't have the same opportunity to receive tax-free income from employment.
Changes to council remuneration should be dealt with locally and transparently through council motions, and residents must have an opportunity for input.
- Colin Nielsen
