Investigation into City of Chestermere finances delivers 31 recommendations

Minister of Municipal Affairs Ric McIver has released details on the findings of a independent third-party investigation into the City of Chestermere’s finances.

The investigation was ordered by the province after complaints of financial irregularities and council dysfunction prompted the minister to fire mayor Jeff Covin and councillors Mel Foat, Stephen Hanley and Blaine Funk in December of last year.

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In January, Minister McIver appointed Deloitte Canada to conduct the financial inspection, the results of which were released by the minister during a press conference in Calgary on Friday afternoon.

McIver says the inspection by Deloitte discovered significant gaps in the city’s financial management and found Chestermere’s finances to have been managed in an irregular, improper and improvident manner between October 18, 2021 — the date of the last municipal election — and December 4, 2023 when the M=mayor and councilors were dismissed.

“It was certainly a robust and thorough inspection,” said McIvor.  “The report identifies gaps in processes and financial controls as well as more recent instances during the period of this review how finances were not managed in compliance with the municipal government act.”

During the press conference, McIvor highlighted three examples from the report:

1.  The city did not have appropriate tools or processes in place to log transactions or protect data;
2.  The inspector tested 565 council expenses undertaken by the Mayor and Councilors and found that 1 of them was submitted with full documented and reviewed approval in   accordance with city policy; and
3.  Regarding financial governance, the report notes instances where council and administration incurred costs without passing a resolution or bylaw or including those expenditures in the city budget.

“A number of these instances were directly tied to the former mayor assuming the power, functions or duties provided to the Chief Administrative Officer, which is specifically prohibited under the Municipal Government Act,” said McIvor.

McIvor says, following his acceptance of the report, he has issued two binding directives to the city:

1. Council and the chief administrative officer (CAO) must review all recommendations of the inspection report and provide a report to the minister on the city’s plan to address each recommendation in the inspection report, or an explanation on why action has not or will not be taken for any individual recommendation(s). The report is to be discussed in open session of council and approved by council resolution following the restoration of council quorum.
2. The CAO must provide printed copies of the inspection report to the public upon request and post the inspection report on the city’s website until all directives have been met to the minister’s satisfaction.

“It’s clear from this report that appropriate checks and balances to protect the interests of the public were lacking,” said McIvor.  “Checks and balances that the citizens deserve from their government in the stewardship of their tax dollars.”

McIvor says he will be writing a letter to all Chestermere residents encouraging them to read the entire report that is available online.

McIvor says he also expects the City of Chestermere to soon be announcing a by-election to be held to fill the vacant seats on council.

“This has been an unfortunate chapter in Chestermere’s history,” said  McIvor.  “Its almost time to turn the page.”