Purpose:

To report on the proposed Terms of Reference for the Task Force to Review Smaller Agencies, Boards, and Commissions and recommend issues to be referred to the Task Force by the Special Committee.

Funding Sources:

Resources will be drawn from existing staff.

Recommendations:

It is recommended that:

(1) the Task Force be renamed the Task Force on Agencies, Boards, and Commissions;

(2) the draft Terms of Reference attached as Appendix I be considered at the first meeting of the Task Force on Agencies, Boards, and Commissions;

(3) the following recommendations in the Toronto Transition Team Report be referred to the Task Force on Agencies, Boards and Commissions and subsequent report to Council through the appropriate Standing Committees:

(4) the last part of Recommendation No. (104) in the Toronto Transition Team Report, which deals with political representation on BIA=s, and Recommendation No. (105) which deals with Boards of Management of community centres, arenas, and recreational facilities be referred to the Task Force on Agencies, Boards and Commissions for recommendation to the Special Committee; and

(5) the appropriate officials be authorized to take the necessary actions to give effect thereto.

Background:

At its meeting of January 2, 6, 8 and 9, 1998, Council established the Task Force to Review Smaller Agencies, Boards, and Commissions and appointed the following seven Councillors:

Councillor Dick O=Brien (Chair);

Councillor Gerry Altobello;

Councillor Brian Ashton;

Councillor Ila Bossons;

Councillor Elizabeth Brown;

Councillor Ron Moeser; and

Councillor Frances Nunziata.

No specific mandate was established for the Task Force and the Chair was requested to develop a Terms of Reference for the Task Force and report to the Special Committee to Review the Toronto Transition Team Report.

The Task Force has not yet had an opportunity to meet to discuss a Terms of Reference and workplan. However, staff have developed a draft and consulted with the Chair of the Task Force, and the draft has been circulated to Task Force members.

This report presents a draft Terms of Reference for the Task Force, outlines a general analytic framework for studying Agencies, Boards, and Commissions and recommends that specific issues before the Special Committee respecting Agencies, Boards, and Commissions be referred to the Task Force for study.

Discussion:

This Task Force was established through a Striking Committee recommendation and was not included in the list of Task Forces recommended by the Transition Team. However, the Transition Team did make more than 40 recommendations regarding Agencies, Boards, and Commissions, many of which arise out of the normal course of the business of government rather than directly from municipal amalgamation.

The first issue in considering the mandate of this Task Force is to determine what might be included in ASmaller Agencies, Boards, and Commissions@. Size could be measured in many different ways and small may range from anything smaller than the TTC, Police or Hydro to as small as arena boards. Size may not be the most important factor in developing a process to review the mandate, structure, and relationship to Council of its agencies. If some basic principles and a framework for review can be developed which will provide guidelines in these areas, they may be equally applicable regardless of size of the agency. It is therefore recommended that the name of the Task Force be changed to the Task Force on Agencies, Boards, and Commissions.

To distinguish between the work of the Special Committee with regard to Agencies, Boards, and Commissions and the work of the Task Force, it may be more appropriate to look at how the individual issues arose. The Special Committee=s priority concerns must necessarily rest with the issues arising due to amalgamation. These are the areas where focused attention is needed to ensure that business continues as smoothly as possible and the appropriate structures are formed from the beginning. The Task Force could then deal with issues which are common across all agencies, issues which existed regardless of amalgamation, and an overall review of mandate, structure and accountability of agencies.

Recommendation No. (69) of the Toronto Transition Team Report states that Council should address the issue of the appropriateness of service delivery through its Agencies, Boards, and Commissions within its initial term. Over the years and through various City Councils, numerous Agencies, Boards, and Commissions have been established. The rationale for continuing these structures and changing the mandates and scope of such boards needs to be reviewed in the context of the amalgamated City and new methods of service delivery which may evolve as a result of restructuring. This is an ongoing process which may extend beyond the immediate integration period and could be assumed by the Task Force.

In addition, there are some issues which may be common to all Agencies, Boards, and Commissions regardless of whether there are specific recommendations in the Transition Team Report. Remuneration of citizen appointees who serve on boards or advisory committees varies considerably among the former municipalities and even within them. Many pay no remuneration except to reimburse out of pocket expenses, some pay a per diem, and others offer a stipend in recognition of the value of the citizen contribution. Previous attempts to develop a consistent approach to this issue have met with considerable barriers to implementation. However, a new policy should be established. This issue could be included in the workplan of the Task Force.

It may also be desirable to refer to the Task Force some of the issues mentioned in the Transition Team Report which apply to agencies which are common across the City. These could include a review of recreational facilities boards and structural issues respecting Business Improvement Areas. The Task Force could review the role, mandate, and composition of these boards. Specifically, the last part of Recommendation No. (104) should be referred to the Task Force, which deals with the legislative requirement for Council to appoint a political representative to BIA=s, and Recommendation No. (105) which deals with the review of community centre, arena and other recreational facility boards of management.

A number of recommendations from the Transition Team do not arise out of the amalgamation process, but rather are ongoing actions which should be pursued in the normal course of government business. Rather than attempting to complete such reviews within the short-term mandate of the Special Committee and because these issues do not arise as a result of amalgamation, it is recommended that the following issues be referred to the Task Force on Agencies, Boards, and Commissions for consideration within the longer term review of all Agencies, Boards, and Commissions:

(1) Part 2 of Recommendation No. (71) of the Transition Team Report which states that all major boards should be required to provide an annual report. The form of the annual report and any other reporting required should be considered within the context of determining the accountability mechanisms for Agencies, Boards, and Commissions;

(2) Part 1 of Recommendation No. (70) which states that there should be citizen representation on all Agencies, Board, and Commissions;

(3) Recommendation No. (91) respecting the necessity for and composition of TradeLink; and

(4) Recommendation No. (92) respecting the role, mandate and composition of the Toronto Economic Development Corporation.

The Terms of Reference of the Task Force on Agencies, Boards, and Commissions attached as Appendix I was developed to encompass all of the issues addressed in this report.

Conclusions:

This report presents a proposed Terms of Reference for the Task Force on Agencies, Boards, and Commissions established by Council and recommends that selected Transition Team recommendations be referred to the Task Force by the Special Committee to include in its ongoing review of Agencies, Boards, and Commissions. The Task Force should review the draft Terms of Reference and workplan at its first meeting.

Mandate:

(1) to review the mandate, structure, and accountability mechanisms of ABC=s and make recommendations for changes where needed; and

(2) to study issues which are common to all or most ABC=s such as remuneration of citizen appointees, selection processes, and community representation objectives.

Timeframe:

Studies to be conducted throughout the initial term of the Council of the new City of Toronto.

Membership:

Seven Members of Council appointed at the Council meeting of January 2, 6, 8, and 9, 1998 as follows:

Councillor Dick O=Brien (Chair);

Councillor Gerry Altobello;

Councillor Brian Ashton;

Councillor Ila Bossons;

Councillor Elizabeth Brown;

Councillor Ron Moeser; and

Councillor Frances Nunziata.

Staffing and Resources:

Resources will be drawn from existing staff within the seven former municipalities, coordinated by the Chief Administrative Officer. It is not clear at this time whether external consultants will be required to study some issues.

Task Force Process and Workplan:

(1) review the draft Terms of Reference and workplan;

(2) develop an analytic framework for studying the composition of boards based on the outline attached as Appendix II;

(3) conduct an initial survey of Councillors, staff, and agencies to collect data and identify issues;

(4) construct a comprehensive database of agencies, boards, and commissions as a reference for comparing similar agencies, grouping issues, and prioritizing the required study areas; and

(5) conduct discrete short-term studies and make recommendations as required.

Much of the database information has already been gathered by staff of each of the former municipalities. Information on what processes other governments have used to undergo similar reviews is also available.

There is universal support for involvement of citizens in advisory capacities. The more difficult issue is the degree to which government should delegate its decision-making authority to citizens who serve on local boards. It is clear that Council retains ultimate responsibility for decisions which it delegates to local boards whether comprised of citizens or Councillors or both. When either Council policy or financial performance are at high risk, the full Council may need to retain decision-making authority and delegate authority where objectives are clear and outcomes can be measured and monitored. It is essential that appropriate accountability mechanisms are put in place to ensure that elected representatives continue to carry the full responsibility for policy and fiscal management while delegating the implementation responsibility to staff or citizen boards.

There are very diverse views on which government services should be managed by local boards, what structure is most appropriate and what scope of authority boards should be given. A framework for considering the numerous issues is needed to assist in making these important decisions.

The composition of a local board appears on the surface to be a straight-forward issue and is therefore often addressed as one of the first steps in establishing a board. However, to ensure that Council will be comfortable with the degree of delegation of authority, the reporting relationship, and the assurance of accountability, the determination of the composition of the board should be one of the last steps in a more comprehensive process.

In considering the composition, there are several questions which need to be answered and a process can be developed to methodically consider these questions. The following provides a brief outline of a process in draft form.

Step 1 - Why is the service being provided?

This question is raised not so much to determine whether it should be a government service or not, but rather to articulate the specific reason the service is being offered by the City. Along with the funding method, this reason can then be used to determine how much authority should be delegated and what accountability mechanisms are appropriate.

Step 2 - To what degree is the service used to implement policy of the government?

Policy in this context refers to program policy and objectives rather than administrative policy. It must be determined whether the municipality sets the policy or whether policy is determined provincially and what discretion the municipality has in further defining policy. A distinction must also be drawn between delegation of implementation of a policy or delegation of policy setting.

Step 3 - What are the financial impacts on the taxpayer?

It is important to know whether any revenues collected are intended to earn a profit, offset costs, or be subsidized by the tax base. Where the service is an exclusive universal service such as hydro and water, user fees can be considered a financial impact on the taxpayer. These are distinguished from user fees for services which are selected by choice of the taxpayer such as recreational services. Generally, the reason identified in Step 1 and whether the policy should be set to encourage or discourage use of the service will determine how the business is funded. There are many ways of considering costs and funding and some Aground rules@ need to be established to ensure consistency in determining the impact on the tax base. The issues include how capital is treated, how user fees are handled, how government grants are considered, and whether centralized costs are included.

Step 4 - Control and Accountability

Before determining the degree of independence, the type and degree of control Council needs to exercise needs to be determined. Types of control include:

(a) Regulatory Control;

(b) Policy Control ;

(c) Budgetary Control ; and

(d) Service Delivery Control.

For each type of control the following questions need to be answered:

(1) who is the entity accountable to? - Council, other government or regulatory body, general public, clients/users;

(2) who is ultimately held accountable to the public? For personal liability, financial debts, property damages;

(3) is success clearly measurable and attributable to the entity?; and

(4) what action is possible if objectives are not met?

Once these questions are answered, the possible level of independence will become clearer.

Step 5 - Is there a need or requirement to operate at arm=s length?

A distinction needs to be drawn between management of a service at arm=s length and delivery of a service at arm=s length. Delivery of any service may be partially or wholly contracted out, even if it is a core government service, if it is efficient and effective to do so and if there are sufficient quality and service checks and balances. Management of the service consists of defining goals and objectives, developing strategies, assessing delivery mechanisms, determining the appropriate funding and measuring results. The critical issue is to what degree services can be managed at arm=s length.

Considering the reason for providing the service, the policy content and financial impact on the taxpayer can be used to classify the type of service and determine to what degree the service can or should be managed at arm=s length from the core government. Generally, the more entrepreneurial a service (low policy content and low financial impact on the taxpayer), the more arm=s length the management of the service from the core government administration. Core government services are those which have a high policy content and a high financial impact on the taxpayer. In order to establish an arm=s length relationship, however, it is essential that the type and degree of controls are considered so that Council can be assured that appropriate accountability mechanisms can be put in place wherever authority is delegated.

Based on the reason for providing the service, the policy content and tax base impact can be used to classify the type of service as follows:

Other situations where it may be appropriate for services to be managed through entities independent of direct government management include:

(1) where the service area is multi-jurisdictional;

(2) where patrons, donations, and voluntarism are key requirements; and

(3) where the function is quasi-judicial or otherwise must be independent of political influence.

Step 6 - What size and composition of the board are appropriate?

Size of a board may be determined by considering:

(a) diversity of opinions required;

(b) required expedience of decision-making;

(c) amount of fund-raising and voluntarism desired;

(d) number of other citizen input methods being used; and

(e) complexity of decisions to be made, size of budget and staff.

The balance of citizen and Councillor representatives on a given board is one of the most critical decisions. This may be primarily a function of how independent the board is from the core government and the reliability of the accountability mechanisms.

Another key issue is whether certain groups should be asked to nominate members or whether citizens should be selected from the public at large. Some specific consideration should be given to citizen representation for the following reasons:

(a) to provide a variety of business perspectives;

(b) to represent stakeholder groups;

(c) to bring specific skills to the task of managing a service;

(d) to be influential in bringing external funding, sponsorship, volunteers, or social profile to the service; and

(e) to represent specific groups of service users.

Summary:

This framework is not intended to be rigid, but rather to provide a convenient and simple way of focusing the thinking process on the various issues which need to be considered in determining the composition of a local board.