Some Centre Wellington residents are questioning who should be making the decisions on how to spend the Jack R. MacDonald trust fund.
The concerns were raised at the township’s Nov. 2 town hall meeting on the 2017 budget – even though use of the trust fund is not directly related to the budget.
Over the years, MacDonald gave $320,000 to Elora, where his father grew up.
When MacDonald passed away in September 2013, he left most of his estate to a charitable trust administered by U.S. Trust (Bank of America). Later, to avoid a U.S. 2% excise tax on investment income, three of the five beneficiaries proposed a one-time payout.
For Centre Wellington, the one-time payout was CDN $2 million.
MacDonald’s will also stated the annual distribution must be used in the former village of Elora – but does not define how.
Council’s decision regarding the initial gift, following extensive discussion in March, was to clear the balance of the internal loan for the municipal office accessibility improvements (i.e. elevator), and to fund Elora downtown public realm improvements such as the construction of the Victoria Street pedestrian bridge (and removing this item from the capital budget).
On Oct. 24, council did not achieve a two-thirds majority vote to reopen this initial decision.
In June 2016, staff reported the charitable donation was increased to approximately $3.4 million (an additional $1.4 million due to a ruling of the Washington State Attorney General).
That money has been put into a special reserve until council comes up with a process to allocate it, including public consultation and input – but separate from the traditional budget process.
Mayor Kelly Linton clarified use of the funds is not actually part of the budget process.
“It is something that came as a nice gift outside of the budget process – and is going to be treated as something separate,” said Linton.
He noted the gift to Elora is something that predated amalgamation (1999).
Residents questioned why the Victoria Street bridge project could not go back into the 2% capital levy for bridge projects.
Linton explained that levy had nothing to do with the Victoria Street pedestrian bridge – the levy was for a list of identified bridges.
He stated both the Victoria Street bridge in Elora and the St. David Street bridge in Fergus are separate projects.
He noted the province has recently allocated funds for work needed on the Fergus bridge.
CAO Andy Goldie said cost estimates for the bridge and downtown improvements will be coming to council in December.
Other residents had the impression the fund was to go towards youth projects rather than capital investments.
Linton agreed the will states the funds are to be for the benefit of Elora.
“But in the past, because the amounts paid were in the range of $20,000 to $25,000 … it was perfect to do smaller projects such as parks,” he said.
Linton added there is nothing in the will that dictates what projects should benefit from the fund.
He said council did hold considerable discussion on the matter.
“Because of the nature of the gift, this should be a legacy project – something which can be seen to benefit as many people in Elora as possible,” the mayor said.
Someone then asked whether the donation from the fund will be acknowledged in any way.
Linton responded “there will be a significant acknowledgement for any work done downtown and the bridge.”
Goldie also noted that in the past the trust fund has also been used for projects such as the township administrative building, the Elora community centre and the Bissell Park pedestrian bridge.
“It’s been used for more than just small play structures, but there were no conditions set by the family,” Goldie stated.
Resident Staci Barron asked “when will you be posting the will (online) for us to see?”
Goldie said the wording of the will is simply that the money is to be spent for the benefit of the village of Elora.
Linton added council needs to establish a process for community input into spending for the remainder of the funds.
“We have to look at every opportunity and make sure we have public input,” he said.
Other residents at the meeting asked whether the money put back into the budget (after money from the trust fund was dedicated for the pedestrian bridge and downtown improvements) will now be used for other Elora-centric projects.
Linton said the $1.4 million is in a separate reserve until the process is in place to support projects to benefit Elora.
However, the issue raised by residents was that the current budget now appears to have an additional $1 million at Elora’s expense.
Linton asked Barron if her question was whether in addition to the $3.4 million from the trust fund, Elora should be getting another $1 million.
“Yes,” she responded.
“I can’t see that happening,” Linton said.
Councillor Steven VanLeeuwen said when the township spends money on capital projects, they are spent even throughout the township.
He explained what happened was the funds were initially spread throughout the township “… and then the need to replace the Victoria Street bridge came up.”
VanLeeuwen said this was an extra $1 million above what was already in the budget, so when the gift came, council saw an opportunity to create an even playing field.
Others found a problem with that approach and believed the trust fund money should be spent outside of whatever capital projects the township had planned.
Linton said the overall capital budget is not intended to pit one community against another, but to look at what best benefits the entire municipality.
Others contended Elora seems to have far less in infrastructure than Fergus.
Linton said council does a good job taking a holistic approach to dealing with capital projects.
“We want to do what is best for Centre Wellington residents,” he said.
As to the remainder of the funds, Linton agreed there are a number of opinions and he wants to ensure there is widespread consultation – with the whole community.
