CIVIC. partnerships. Guide to Policy & Administration

Transcription

1 CIVIC partnerships Guide to Policy & Administration

2 CIVIC Partnerships...together is better! I am very pleased to release the Civic Partnerships Guide to Policy and Administration. The original version of the document, entitled Autonomous Bodies Guide to Policy and Administration was adopted in summary form by Council on 2000 May 15. It has since been revised to be more clear and succinct. Community Strategies, through its Civic Partnerships Division, coordinates the overall governance function related to partnerships with not-for-profit organizations across the Corporation. The primary relationships with the organizations themselves remain with the contact Business Units. The City of Calgary continually seeks effective and mutually beneficial partnerships which ensure protection and stewardship of the resources we provide to our partners. The Civic Partnerships Guide to Policy and Administration provides a basis to fulfil this mandate. We are striving to build a dynamic relationship model founded on greater consistency, clear and understood roles and responsibilities, strong coordination of efforts and integrated approaches to issues. The Civic Partnerships Guide to Policy and Administration frames The City of Calgary s relationships with its community partners. It is very important that we be deliberate and strategic in these partnerships. Also, it is essential that we work together, both internally and with community stakeholders, to ensure that our collective experiences, mandates and skills are brought to bear in resolving any challenges realized in the implementation of this document. Please view it as a work-in-progress. There may be some elements that require re-consideration. Other governance issues may not have been anticipated and will be dealt with as they arise. Together, I am confident that this work will result in stronger and more accountable partnerships. Erika Hargesheimer Executive Officer

3 Table of Contents SECTION 1: INTRODUCTION 1 SECTION 2: FOUNDATIONS 3 SECTION 3: PARTNERSHIPS 9 SECTION 4: ROLES AND RESPONSIBILITIES 15 SECTION 5: ACCOUNTABILITIES 21 SECTION 6: APPENDIXES 33

4 Section 1: INTRODUCTION The City of Calgary partners with not-for-profit organizations to improve quality of life for the citizens of Calgary. We therefore strive to build the capacity of The Corporation to strategically and accountably enter into, and manage partnerships with not-for-profit organizations. There has been limited uniformity in the terms of each partnership as a result of the unique nature of individual not-for-profit organizations, historical development of relationships and the lack of a common City approach to development. This Civic Partnerships Guide to Policy and Administration addresses those issues. The intent of this document is to establish principles and guidelines to ensure effective management and strategic allocation of available resources with an overall purpose of optimizing City partnerships. This ongoing effort is premised on the belief that The City of Calgary and not-for-profit organizations have a common interest in service to the community. The City is interested in moving forward and is taking this initiative to improve and build on our existing partnerships. Through partnership, we together make an important contribution to the community and the life of Calgarians. Working together to create and sustain a vibrant, healthy, safe and caring community. 1

5 Section 1: INTRODUCTION FOCUS OF GUIDELINES As The City s relationships with not-for-profit organizations are becoming more complex, it is very difficult to develop a governance model that provides an exact fit for every relationship. Therefore these guidelines outline generic governance expectations for current or future City relationships with those organizations that deliver services Council has deemed worthy of public support. This document outlines basic responsibilities and accountabilities. City business units may modify or include additional conditions based on each unique relationship. It is anticipated that expectations of The City will be defined and added to these guidelines. The City is redefining its role in delivering services in response to internal and external drivers. Success in developing alternate delivery options requires The City to: Form cooperative agreements with various not-for-profit sector providers to draw on their strengths and capacities Give the not-for-profit sector flexibility to be creative whereby negotiated agreements balance accountability requirements with the flexibility the not-for-profit sector needs to manage its work effectively Give City Administration the flexibility to be innovative and creative in developing alternate arrangements Ensure timely response to emerging issues. This policy is intended as a guide to develop partnership agreements. While forming the basis for all agreements, these guidelines are flexible enough to allow for the specific needs of various organizations. Existing agreements and legislation override these guidelines in the event of any conflict. City Administration is expected to exercise due care in negotiating and in determining the appropriate agreement conditions. It is important for senior management to provide strong leadership and guidance by ensuring that agreements: Provide the right balance between autonomy and accountability Are updated on a timely basis for emerging issues Are honored by both parties, with appropriate action taken for non-compliance. An executive officer may make exceptions to the guidelines based on a strong business case. 2

6 Section 2: FOUNDATIONS THE CASE FOR PARTNERSHIP The City of Calgary partners with over 300 not-for-profit groups. These relationships developed over many years based on a variety of different reasons. The City supports these partnerships because benefits accrue to Calgarians. The value of these partnerships includes economic development, increased tourism, cultural diversification, shared risk management and positive public relations. City support is demonstrated through provision of land, facilities, funds, and/or other contributions. By partnering with not-for-profit organizations to support and enhance direct programs and services, Calgarians realize the following benefits: Improved response to customer needs Support for and leverage from a strong and established network of community expertise and volunteers Access to alternative sources of funding and partners not typically available to the municipality on its own Reduced duplication of services Strategic selection of critical programs and services that contribute to a stronger community. 3

7 Section 2: FOUNDATIONS PARTNER ORGANIZATIONS The City s partners in delivering service are referred to by several terms including: autonomous bodies, not-for-profits, arms-length organizations, community partners and civic partners. Regardless of the term used, each is a not-for-profit organization that has a formal and legal relationship with The City to provide services or programs in conjunction with or on behalf of The City (Note: This framework does not apply to Administrative, Advisory, Legislated Committees or Boards of Council). Not-for-profit organizations are typically registered under municipal, provincial, or federal legislation. The objectives of these organizations are to fulfill a social, charitable or community purpose as opposed to providing a financial return to their investors. For the purpose of this policy, not-for-profit also implies that a volunteer Board of Directors governs the entity. Civic partners function at arms-length and are self-governed and independent from The City. A partnership arrangement may be considered where both parties benefit by working together towards: Shared or compatible objectives Shared authority and responsibility Joint investment of resources Shared risk. The City s partnerships vary significantly in terms of type, size and scope. To manage these relationships effectively and efficiently, there must be a context to understand the nature of these partnerships and to the extent possible, the ability to develop consistency among the underlying terms and conditions. 4

8 Section 2: FOUNDATIONS GOVERNANCE MODEL In this document, governance refers to the role The City takes in the management and stewardship of the public trust in its relationships with arms-length organizations. The goal of City governance is to have The City and its not-for-profit partners work together to achieve community needs in a timely and efficient manner while at the same time ensuring that The City's accountability requirements are achieved. Specifically, through clearly defined and effective partnerships, The City may focus services on its strategic issues and outcomes to: Develop an environment for innovative service delivery and financing arrangements Create a better link with its partners Avoid micro and/or dual management Ensure public accountability. Governance is dependent on the type of relationship The City has with a given organization. Partnerships are generally defined using the following principles: Legal Source: the legal basis of the relationship Risk Assessment: the type and amount of risk to which The City is exposed Risk Management: accountability needs and requirements. These three key principles are used in evaluating the partnership and form the foundation for a partner relationship as described further. Legal Source The Legislative Act, City bylaw or Council resolution establishes the parameters under which the organization must operate and defines its legal authority. The operating agreement between The City and the partner organization in conjunction with the appropriate legislation determines The City s role and in some cases, legal authority to: Set the mandate and service expectations Appoint board members Set the partner s strategic and operating directions. 5

9 Section 2: FOUNDATIONS Risk Assessment The City s exposure to type and level of risk is assessed in two main areas: City contributions: Land investment Facility investment Level of operating and capital funding Technical support Financing arrangements Other types of investment. Public need and benefits: Strategic importance of the services the organization provides Organization provides a core City service Public use considerations are critical Public support for the service or program Organization's ability to hire personnel with the appropriate skills to manage the organization effectively. 6

10 Section 2: FOUNDATIONS Risk Management Risk management is the process of identifying, analyzing, evaluating, treating, monitoring, and communicating risks so that an organization can maximize its opportunities and minimize its losses. In this framework, it refers to how The City can most effectively manage, control, and minimize the risks identified through the assessment process. The City's approach to risk management is defined in two main categories: Strategic Involvement - refers to the level of City involvement in the organization including whether The City is required to: Set the organization's mandate Control or participate on the Board of Directors Appoint the Chief Executive Officer (or equivalent) Adopt business plans and approve budgets and grants Participate in setting program objectives Establish public accessibility expectations. Accountability Requirements refers to the level of reporting that the organization must provide to The City and The City's subsequent approval of the results. Reporting requirements are further defined in Section 5: Accountabilities, and include such things as: Results achieved compared to budgeted levels or on a per dollar basis Adherence to public use policies and accessibility requirements Annual financial reports and budgets Protection and maintenance of City assets Appropriate use of public funds as contracted City's right to audit results. 7

11 Section 2: FOUNDATIONS This framework provides the basis not only for evaluating future partner organizations but also for evaluating existing relationships to ensure that the current governance structure is appropriate. The goal of the governance process is to identify how The City and its autonomous bodies can best work together. Table 1: Areas Assessed in Partnership Development Type of Partnership* RELATED ENTITIES LEGAL SOURCE Legislation City Bylaws Council Resolution RISK ASSESSMENT City contributions, public need & benefits City responsible for operations & financial viability RISK MANAGEMENT City strategic involvement & accountability requirements Total strategic control Accountability through regular City processes RISK PROVINCIAL LEGISLATED ENTITIES Provincial Acts City Bylaws Government Agreements City must provide some funding Significant impact on the delivery of City services but City does not have full authority City may have some involvement & accountability controls but this is a function of the agreement The City is able to create with the Provincial Government High JOINT VENTURES Operating Agreement Type & level of City investment varies by organization High public needs & benefits Joint strategic & management control High accountability requirements Important City Services ALLIANCES Operating Agreement Investment may include land buildings or operating funds (generally over $300,000) High public need & benefits Level of strategic involvement is high but is a function of investment type and levels Accountability requirements are a function of investment levels Medium AGENCIES Operating Agreement Funding contributions only (usually less than $300,000) No strategic involvement unless requested by partner Service needs & fees set by The City Accountability requirements only to support funding requests PREVENTIVE SOCIAL SERVICES Legislation Funding Agreements Funding contributions only Public need & support based on social issues No strategic involvement Accountability requirements only to support funding requests Low COMMUNITY ORGANIZATIONS Lease or License of Occupation Agreement City provides land but no funding dollars Strong public need based on support of Community progress Little strategic involvement Strengthening accountability requirements through a new best practice model to give The City stronger stewardship 8 *Further defined in Section 3: Types of Partnerships

12 Section 3: PARTNERSHIPS CRITERIA The City establishes partnerships when it is the best method of providing the desired program or service. Key factors to determine whether a partnership should be established include: Significant benefit(s) for both parties Public support of the service as decided by Council Independent decision-making, operational efficiency and flexibility and public involvement are critical success factors The ability to leverage capital and/or operating funds provided by The City with funding involving other critical partners. 9

13 Section 3: PARTNERSHIPS FORMING Establishment of a partnership requires approval by City Council of the fundamental terms for a partnership including: Purpose of the relationship Services to be provided by the organization City contribution Term of the contract Means of evaluating the success of the contract. Other unique aspects requiring Council's sanction should be stipulated at the outset. Fundamental terms can also be approved by Council s approval of a standard terms of conditions for agreements, (as is the case now for Preventive Social Services and Community Organizations). Terms may be achieved through the current provisions for program manager authority, which allow approval of expenditures within certain limits, as long as program objectives are met. This foundation enables the Contact Business Unit general manager to enter into an agreement based on the core terms. Once these agreements have been signed the partnership becomes legal. 10

14 Section 3: PARTNERSHIPS DEFINING As portrayed in Figure 1, five areas are addressed to define the relationship specific to each organization. Figure 1: Defining Partnership & Governance Accountable to Public City of Calgary Partnership Expectations Not-For-Profit Groups Accountable to Members Rules & Responsibilities Communications Planning Outcome Evaluation Agreements Stewardship of public land, facilities, funds & service delivery 11

15 Section 3: PARTNERSHIPS General Why is this partnership being developed? What are the intended outcomes? How does this partnership leverage The City s ability to provide services to citizens? Roles And Responsibilities What are the roles and responsibilities of each party? What are the goals of the partnership and of the organizations? Communications What are the reporting requirements? What is the information flow? How is The City accountable to the public? How is the organization accountable to The City? Planning What is in the Business Plan? What are the strategic goals? How much is the budget(both for the organization and for the specific service being offered)? Outcome Evaluation What are the expected outcomes and performance indicators? How are the outcomes measured? Agreements Are there any special circumstances that need to be reflected in the agreement? Does the agreement align with and reflect the partnership? 12

16 Section 3: PARTNERSHIPS TYPES OF PARTNERSHIPS The City has defined seven types of relationships with not-for-profit organizations. Each is briefly described below with additional detail regarding each relationship provided in Appendix 2. Related Entities Organizations, which are owned or established by City Legislation, bylaw, Council resolution or related acts. Provincial Legislated Entities Organizations established under Provincial Acts. Joint Ventures Arrangements between The City and not-for-profit organizations, where both parties agree to jointly participate in and manage a project, with each having a defined management role. Alliances Arrangements that are based on mutual interest. The City is primarily a facilitator in this partnership, providing some key resources, participating in setting of service expectations and monitoring outcomes. The partner is responsible for service delivery with full management and control of the operational aspects of the service. The partner is also responsible for the financial viability of the organization or program. Agencies An organization that delivers services on behalf of The City on a fee-for-service basis. The City sets the terms of the delivery, but the Agency is responsible for the service delivery and overall costs. Preventive Social Services Agencies that receive City/Provincial funding and comply with the conditions of their Family and Community Support Services (FCSS) funding agreement. This category also covers social service agencies that receive one-time funding under existing policies for MATCH-Solutions and Innovative/Preventive Funds. Community Organizations Organizations that have a lease or license of occupation with The City and meet the criteria approved by Council for community associations or social/recreation organizations. 13

17 Accessible, accountable, New forms of governance allow individual organizations to contribute their strengths and talents, to discharge their collective responsibilities and to preserve and enhance the distinctiveness of their organizations and institutions. Good governance is among other things participatory, transparent and accountable. It is also effective and equitable and it promotes the rule of law. SOURCE UNKNOWN

18 Section 4: ROLES & RESPONSIBILITIES Successful partnerships depend, in part, on the clear definition of roles and responsibilities. Roles and responsibilities vary according to partnership type, and therefore their early and clear definition will ensure objectives are achieved. In general, City involvement is from a strategic perspective, focused in the areas of risk, while partner organizations concentrate on operational aspects. THE CITY OF CALGARY The City's role varies from day-to-day management to providing annual funding with limited involvement in the organization's operations. To fulfill its role as a public trustee, The City is represented where the investments and/or risk are the greatest. The greater the investment risk, the more significant The City's participation. A detailed description of The City's involvement by partnership type is provided in Table 2 below: Table 2: City Governance Responsibilities By Partnership Type Activity Partnership Type Related Entities Provincial Legislated Entities Joint Ventures Alliances Agencies Preventive Social Services Community Organizations General Overview Sets mandate or mission Sets service objectives & accountability expectations Fully Responsible for Operations According to Legislation Varies by Act Varies by Act Joint Participation & Mgmt Jointly Jointly Primarily a Facilitator Jointly* Jointly* Financial Viability & Use of Funds N/A N/A Use of Funds Per FCSS Act & City Priorities Funding Priorities Financial Viability & Use of Funds N/A Land use only Appoints City representative(s) to the board All or a majority Varies by Act Relative to role Consider one (possibly nonvoting) None None None Participates in appointment of organization s CEO (or equivalent) Varies by Act Jointly Jointly* N/A N/A N/A Approves business plan & annual budget or just annual grant Varies by Act Jointly Information on annual objectives & grant only Information on annual objectives & grant only Business Plan (multi year programs) Annual grant N/A Approves major expansion plans Varies by Act Jointly Jointly* N/A N/A Receives periodic or annual reports to review service outcomes Varies by Act N/A Receives financial information to review organization s financial viability & ensure funds used as intended Varies by Act Financial viability only Receives facility maintenance status reports or can undertake periodic inspections to ensure assets properly protected N/A N/A N/A N/A Conducts audit on a need basis Varies by Act N/A 15 *Joint involvement should occur where the organization operates a major City owned facility, provides a major public service or The City provides funding (includes financing costs) for more than 50% of its gross expenditure.

19 Section 4: ROLES & RESPONSIBILITIES Four distinct groups share City responsibilities. City Council City Council is involved in strategic decisions, therefore it: Ratifies City appointments to boards of directors May ratify organization's Chief Executive Officer s (or equivalent) appointment in some instances as per agreement Ratifies service objectives and accountability expectations through the annual budget review process Approves fundamental terms of the partnership including: purpose, services, City contributions, term of contract and other relevant conditions. In addition, Council selects the citizen board member appointments. Criteria for board appointments, both City and citizen is provided in Appendix 3. City Board Representative(s) A City board representative refers to a City employee appointed by Council to represent The City s interests on the board of a partner organization. The City board representative acts primarily as a facilitator to: Assist in setting the organization s strategic direction and goals Provide a communication link between The City and organization Advise the organization on issues that affect The City Ensure re-negotiation of agreement prior to expiration. The City board member represents The City on any issues impacting City business and presents appropriate issues to City Administration after advising the partner s board of their intention. The City board member may assist in reviewing business plans, funding requests, and reviewing the organization's financial status and performance levels. Where there is a conflict, primary responsibility is to The City. In situations where the role is to provide an operational link between The City and the partner organization, the representative can be a business unit manager or designate. Where The City s involvement is required for legislative or strategic purposes, an Alderman, Executive Officer or General Manager would be appointed. In these cases, a Contact Business Unit employee would be designated to provide the operational link (see below). 16

20 Section 4: ROLES & RESPONSIBILITIES Contact Business Unit The Contact Business Unit administers partnership agreements under its jurisdiction and its general manager has the authority to enter into a contract based on the fundamental terms approved by Council. Most often, the Contact Business Unit is that of the City Board Representative who may also function as the operational liaison or identify a staff member to carry out that function. Responsibilities will vary by type of organization and may include any or all of the following: Act as a City board representative Liaise with organization and City board representative(s) Set service objectives and accountability expectations through the operating agreement Ensure that agreement terms are adhered to and inform the Executive of critical issues Ensure agreements are reviewed on a timely basis and/or when conditions change Negotiate agreements and changes in accordance with City policy Participate, where specified, in the appointment of the organization's chief executive officer (or equivalent) for Related Entities, Joint Ventures and Alliances Review business plans, annual funding requests and budget presentations with The City board representatives and make recommendations to the Executive Review service results and financial viability with The City board representatives, inform Council and recommend action on issues of concern Review all process and communication links and make recommendations for improvements to the Civic Partnerships Division or the Executive Receive maintenance status reports or complete inspections to ensure assets are properly protected Ensure, in consultation with the Civic Partnerships Division, that the new City board representatives receive an orientation and training on their roles and responsibilities Conduct regular (every 2-3 years) visual inspection of The City-owned facilities to identify any maintenance problems. 17

21 Section 4: ROLES & RESPONSIBILITIES Civic Partnerships Division The Civic Partnerships Division in Community Strategies was established to co-ordinate The City s overall governance function related to its partners. Working closely with The City Board representatives and Contact Business Unit liaisons, the Division's key responsibilities are to: Develop and maintain partnership governance policies Review policy exceptions and provide recommendations to the Executive Ensure appropriate accountability and reporting structures are in place among The City business units and Council Ensure a link exists between each partner organization and a Contact Business Unit and assume role of Contact Business Unit if more appropriate link does not exist Ensure the Executive is appropriately updated on the status of, and issues related to, major capital projects Assist business units in identifying and evaluating new opportunities for service delivery including reviewing and making recommendations on new agreements Work through Contact Business Units to provide operational and technical support to partner organizations Assist Contact Business Units in conducting strategic reviews Ensure Contact Business Units have analyzed annual funding requests and have provided their recommendations to the Executive Report to Council regarding the total City contributions to partner organizations Assist Contact Business Units in negotiating new, and re-negotiating existing, operating agreements Review periodic or annual reports and ensure financial viability and goals are being achieved Make recommendations to business units on opportunities for shared services including financial support, system sharing, and maintenance. 18

22 Section 4: ROLES & RESPONSIBILITIES NOT-FOR-PROFIT PARTNER Each partner organization has the mandate to govern its own organization. This could include objectives to operate City facilities, provide public services and/or access public funding. The City expects that partner organizations will operate efficiently and effectively, meeting both the needs of their membership and the needs of the partnership. It is expected that each partner will perform the primary functions of a healthy organization including: Establish accountability and reporting structures to its Board of Directors and stakeholders Develop a mission statement and policies/priorities Manage revenues (from donors and government) and expenditures in a fiscally responsible manner Implement effective organizational and management structures and processes Ensure effective, high quality programs and services Develop a service delivery plan including performance measures (if relevant) Identify risks and implement an action plan to manage these risks Provide The City with the appropriate information for funding requests Present funding requests and/or organizational plans to Council Provide The City with information on annual operating results, service levels, and accomplishments Provide periodic progress reports as required in the agreement Provide The City with a facility maintenance report to indicate that assets are properly protected Prepare financial statements in accordance with generally accepted accounting principles and as outlined in the Canadian Institute of Chartered Accountants (CICA) guidelines. 19

23 Accessible, accountable, There is no alternative to working together and using collective power to create a better world. Goverance is the sum of the many ways individuals and institutions, public and private, manage their common affairs. It is a continuing process through which conflicting or diverse interests may be accommodated and cooperative action may be taken. THE COMMISSION ON GLOBAL GOVERNANCE

24 Section 5: ACCOUNTABILITIES To be successful, each of the partners accepts accountability for some aspect of the relationship. Within The City's governance model, expectations and accountability requirements vary by partnership and depend on the category of partnership as determined by the key governance principles. These accountabilities are then formalized within written agreements. CITY SUPPORT The City's contributions to partnerships in the community can be categorized into these main types: Land Facilities Funding Artifacts or collections Authority to manage. Partners may receive one or more contributions from a combination of these categories. For a variety of reasons, The City may have a more limited or more extensive investment in the partnership. Some of the factors that could affect this would include whether the service: Is critical to the core business of The City Has contributions from other sources Represents a service gap. 21

25 Section 5: ACCOUNTABILITIES Figure 2 portrays the typical types of City investment according to each partnership category. Figure 2: Typical City Investment according to Relationship Type Relationship Type Land Facility Capital Funds Investment Type Operating Funds Artifacts/ Collections Authority to Manage RELATED ENTITIES one or more of these PROVINCIAL LEGISLATED ENTITIES JOINT VENTURES ALLIANCES one or more of these AGENCIES or or or or PREVENTIVE SOCIAL SERVICES COMMUNITY ORGANIZATIONS 22

26 Section 5: ACCOUNTABILITIES INVESTMENT-SPECIFIC EXPECTATIONS Some accountabilities result from the nature of the investment made by The City as detailed below. Land The City may provide land to partner organizations for use in delivering their services/programs. The accountability requirements focus on The City's role as a public trustee and must ensure: Land is used for the intended purpose Land Use Bylaw and municipal reserve requirements are met The partner organization's financial position is not substantially deteriorating Service/programs produce the intended benefits Compliance with Public Use Policy and operating agreement Outcomes are measured against pre-established goals (both budget and service) Service benefits the targeted customer group Service significantly contributes to the quality of life The City has the right to visually inspect and audit the operation Land is maintained as per agreement. 23

27 Section 5: ACCOUNTABILITIES Facilities The City may provide facilities to partner organizations for use in delivering their services/programs. The accountability requirements focus on The City's role as a public trustee and must ensure: Facilities are used for the intended purpose Facility use requirements are met The partner organization's financial position is not substantially deteriorating Buildings are operated and maintained as per the agreement The City approves major expansions Subtenants obtain The City's approval Service/programs produce the intended benefits Compliance with Public Use Policy and operating agreement Outcomes are measured against pre-established goals (both budget and service) Service benefits the targeted customer group Service significantly contributes to the quality of life The City has the right to visually inspect and audit the operation. City facilities are maintained and protected by the partner organization with: A regular preventive maintenance program including mechanical, electrical and safety systems City-approved Lifecycle Maintenance Plan Facility Lifecycle Replacement Reserve Fund requirements An annual inventory of all major assets and their key components for use in an infrastructure replacement plan Technical assistance on a cost-recovery basis is available to organizations as necessary. 24

28 Section 5: ACCOUNTABILITIES Funds The City may provide funding to autonomous bodies to assist them in delivering their services and programs. Funding contributions may be in the form of annual grants (operating or capital), fees for service, financing costs and costs of other support services provided by The City. The City bases its funding allocation decisions on the following criteria: The City s service priorities and funding limitations Service goals and costs Other partner contributions Policies regarding user fees, etc. Efforts to increase efficiencies and reduce costs The organization s existing reserve levels The City s expectations on the organization moving towards self-sustainability. The City will attempt to provide where feasible, 3-year operating and 5-year capital funding commitments to enable organizations to do longer-term planning. Capital contributions will focus first on infrastructure lifecycle maintenance and then on major upgrades and expansion plans. Funding allocation recommendations are made by the Contact Business Unit, however all grants are subject to Council approval. Requests for funding are handled through the Contact Business Unit and are a part of The City s annual budget process. Organizations must provide information to support their request including: Annual budget and amount of funding requested including any funding change Explanation and justification for funding requests, particularly where significantly different from previous years Budget information as required through The City budget process Additional information may be required to allow the Contact Business Unit to analyze results and make a recommendation. 25

29 Section 5: ACCOUNTABILITIES Budget presentations occur as follows: Operating A detailed budget in City business unit format in the case of Related Entities; information on objectives, results, reserves and annual grant (including support costs, such as: financing, insurance, property tax) is required for other partnerships. Capital - Lifecycle and Infrastructure Upgrades Capital budget information is to be presented in City business unit format. Organizations should identify any significant operational and safety impacts of project deferral. Capital - Major Projects City business unit format is required for major project capital submissions. Organizations should also provide a special report on the major upgrade or expansion plan, including: Project details and benefit justification Other partners and their contributions Proof of financing and contingency plan for higher than expected costs Construction time-frames and cash-flow projections Proof that appropriate project management support is in place Proof that the organization will be able to operate the facility and fund future infrastructure needs without City assistance, including cost containment plans where revenues are lower or costs exceed expectations Alternative options that Council can consider. 26

30 Section 5: ACCOUNTABILITIES Artifacts/Collections When a partner manages artifacts or collections on behalf of The City, the accountabilities may include: A collections plan for maintenance and replacement Description of the artifacts or collections, including valuation appraisal and proof of adequate insurance Standards of care Fee structure Financial reports Obligations of The City and the partner organization Recognition of ownership of property City representation on the Board of Directors Surrender of asset(s) details. Authority to Manage A limited number of situations exist where a civic partner will manage and/or distribute funds or assets on behalf of The City. In these cases, the accountabilities may include: Fee structure Obligations of The City and the civic partner Financial reports Operational reports City representation on the Board of Directors. 27

31 Section 5: ACCOUNTABILITIES GENERAL EXPECTATIONS Business Plans A 3-year business plan with annual updates should be provided to The City. In addition to the general programs and services of the partner organization, the business plan should identify strategies and objectives for providing the services covered in the partnership agreement and the key issues that are critical to The City's involvement. The level of detail required in the business plan will vary by organization, however key information would include: Purpose of the relationship Three-year goals and objectives and relationship to intent of the agreement Changes to goals and objectives where it impacts The City Critical risks/barriers to achievement of goals Results achieved Future opportunities for growth and change Financial and operating plan details Other partners and their contributions Building maintenance plans if applicable Organization s strategic direction including changes in strategy and long-term funding implications for The City s involvement. Annual/Periodic Reporting The City obtains from its partners, information necessary to make informed decisions. This information is required at minimum on an annual basis and includes the following: Strategic direction with services covered in the relationship Significant changes in strategy Uses of funds and outcomes achieved Annual reports and audited financial statements within 5 months of the organization s year-end. 28

32 Section: ACCOUNTABILITIES Surplus or Deficit Funds Treatment of operating and/or capital surplus funds must be outlined in all agreements. Subject to each individual agreement, surplus funds may in general be: Transferred to capital or operating reserves to support future initiatives covered within the partnership Returned to The City where the arrangement is a fee-for-service Used to offset future deficits or adjust annual grants. A policy for addressing deficits should be provided in all agreements. Strategic Review A strategic review should be conducted every five years, one year before the partnership agreement is to be renewed, or when there is a proposal for major expansion or service change. The Contact Business Unit should conduct the strategic review. The focus should be on the purpose of the relationship and desired outcomes. Other considerations to be determined include: Is the service still worthy of public support? Are the goals and results being achieved? Is City support appropriate? Is the partner the right organization to deliver the service? Will changes to the process affect other City services? Are other sources of revenue available? Is The City's governance process the most appropriate? 29

33 Section 5: ACCOUNTABILITIES Insurance Each organization must ensure that it has adequate insurance coverage including property, liability, automobile, crime, and Board of Directors indemnity as applicable. To ensure that the appropriate policies are in place, the organization should review coverage annually with The City's Risk Manager and its Contact Business Unit liaison. Information Technology Management of information technology needs is the responsibility of the organization. The City may provide strategic and technical advice when requested by the organization and when the systems are a critical component of the service function supported by The City. This may be available to Related Entities, Joint Ventures and Alliances. Stewardship of Information The City became subject to the provisions of the Freedom of Information and Protection of Privacy (FOIPP) Act in In some cases, a civic partner will be subject to FOIPP or hold records that may be classified as City records. Each partner organization is responsible for understanding and meeting their FOIPP obligations. The Contact Business Unit liaison ensures that their partner organizations meet the requirements as they relate to The City's FOIPP obligations. This would include determining: Relevance of FOIPP to the partner organization Whether partners hold any records that are considered to be City property If partners store documents appropriately and have policies and procedures for records retention. 30

34 Section 5: ACCOUNTABILITIES AGREEMENTS In conjunction with City by-laws and relevant legislation, the agreement document outlines the nature and purpose of the relationship. This encourages mutual compliance and fosters organization empowerment, continuous improvement and outcome measurement and reporting. The agreement document is the primary mechanism in which governance processes and partnership accountabilities are communicated. In addition to the fundamental terms on which a partnership is established, other standard terms in the agreement may include: Services, products and accessibility requirements Roles and responsibilities of each partner (including responsibility for costs such as rent or property taxes) Accountability requirements and reporting structure Requirements for City board representation and other City support and/or resources Policies to ensure staff act in the best interest of the organization and The City Evaluation, review and/or sunset clause as applicable Conflict resolution clause The actual agreement terms would depend on the organization and the type of relationship between The City and the partner organization. 31

35 Accessible, accountable, THE CITY OF CAGARY WORKS WITH ITS PARTNER ORGANIZATIONS IN A MANNER CONSISTENT WITH ITS CORPORATE VALUES: We create public value for our community. We build trusting relationships in an ethical and professional manner. Our behaviour speaks louder than words. Be HONEST & tell the truth Pursue EXCELLENCE Be ACCOUNTABLE Be RESPONSIVE, compassionate & fair TREAT others with respect

36 Appendix 1: GLOSSARY ACCOUNTABILITY FRAMEWORK A structured set of rules/guidelines governing an organization s operation/activities that make clear who is accountable for those operations/activities, to whom they are accountable and how they are accountable. AGREEMENTS - Includes Acts, by-laws, leases and operating agreements. These will define the terms of the partnership and accountability. ALTERNATIVE SERVICE DELIVERY Going outside the traditional delivery structure boundaries to get the best service delivery that achieves The City s quality and financial objectives. APPROPRIATENESS - the extent to which the design of a service or its major components, and the level of effort being made, are logical in light of the specific objectives to be achieved. AUDITED FINANCIAL STATEMENTS - Set of financial statements prepared in accordance with the generally accepted accounting principles, as outlined in the CICA guidelines, and certified by a professional accountant that reports on the financial position of the entity, the results of its operations for a specified period and the changes in its financial position. Financial statements should be related to the program and services covered in the agreement. AUTONOMY - Allow not-for-profit organizations to act on their positive characteristics, including being innovative, flexible and responsive. BOARD OF DIRECTORS (of civic partner) - As defined under an organization's by-law. BUSINESS PLAN - Set of plans explaining the rationale for activities that aim to achieve specific outcomes and outputs, and outlining the inputs that will be needed. BUSINESS RISK ASSESSMENT - Set of activities which an organization undertakes in order to minimize exposures it faces in its business activities. CITY-OWNED FACILITIES - Any buildings or improvements on City-owned lands; sometimes the current lease or operating agreement also stipulates The City to be owner of the facility. CORE CITY SERVICE - Services currently being provided by a City operation. FINANCIAL SUSTAINABILITY - The ability to generate enough revenue to cover annual expenses on an ongoing basis. FUNDS USED AS INTENDED - Expenditures are made in accordance with the line item budget the organization presented to The City to support its funding request. 33

37 Appendix 1: GLOSSARY GOVERNANCE - The process and structure used to direct and manage the affairs of an organization with the objective of enhancing stakeholder value, which includes ensuring the financial viability of the organization. INFORMATION TECHNOLOGY ARCHITECTURE AND STANDARDS Represents the stated attributes that are expected of the system, and represents some of the design goals, modes of behaviour and performance characteristics that the business requires for IT applications and systems. MAJOR OR SIGNIFICANT Has to be considered in context to each relationship. MONITORING AND REPORTING The extent to which key matters pertaining to performance and organizational strength are identified, reported and carefully monitored. OUTCOME MEASURES Measures that look at the end results and indicate whether the service actually produced the intended benefits. PROTECTION OF ASSETS The extent to which important assets, including important records, are safeguarded so that the organization is protected from the danger of losses that could threaten its success, credibility and continuity. PUBLIC USE POLICY - The policy approved by Council on September 2, 1986 that requires City land and facilities to be open to the public for a minimum of 50% of the operating time available. RESERVE FUNDS Funding appropriations set aside for the funding of future operating or capital expenditures. RESPONSIBILITIES - Duties and tasks employees are entrusted with and are expected to do. RISKS - Circumstances that may prevent or impede the achievement of objectives, including the risk of being unable to optimize on opportunities. RISK MANAGEMENT - Procedures to identify and assess risks, and introduce measures to manage or mitigate their probability and/or impact. ROLES - Capacities in which one serves. SELF-SUSTAINING Ability of a third party entity to generate enough revenues by selling goods and services to its customers that it does not require further funding assistance from The City. 34

38 Appendix 2: PARTNERSHIP CATEGORY DEFINITIONS RELATED ENTITIES Related Entities are organizations, which are owned or setup by City Legislation, bylaw, Council resolution or related acts. For Related Entities, The City s involvement includes: Setting the organization's mission/mandate Council appointment of all or the majority of the organization's board of directors Council responsibility for financial viability of the organization Council delegation of the operations management to the organization's board Participation in the appointment of key management staff, including determination of remuneration; Council/City Executive Officers approve the organization's business plan, annual budget and any rates and fees Council/City Executive Officers review outcomes through The City's budget reporting process. PROVINCIAL LEGISLATED ENTITIES Provincial Legislated Entities are organizations established under Provincial Act, where the Act sets out the governance structure. The City clearly recognizes its legal limitations in the governance of these relationships, and has established alternate processes to give it sufficient authority to influence matters that affect The City. Provincial Acts give the Minister the ultimate authority to take any necessary actions deemed appropriate. City involvement is through the Minister and applicable City bylaws. These organizations can have significant impact on The City as: They significantly impact the delivery of City services and/or the need to link with City core services They requisition funds from The City, impacting The City's financial ability to meet other core service obligations The public may approach The City to address issues of concern. 35

39 The City's governance needs should be met through the establishment of City bylaws, where the Provincial Act gives it such authority, or through an agreement between the Minister and City on key governance needs. The Provincial Act or City bylaw should cover Council and City Administration's authority regarding: Mandate and service expectations Board appointments Appendix 2: PARTNERSHIP CATEGORIES DEFINITIONS Appointment of the organization's chief executive officer Approval of business plans and annual budget The organization's reporting structure to The City Accountability requirements and process. JOINT VENTURES Joint Ventures are arrangements between The City and not-for-profit organizations, where both parties agree to jointly participate and manage a project, with each having a defined management role. These arrangements are established through the execution of a Joint Venture Agreement that clearly recognizes each party has a joint management role. This agreement: Outlines the purpose of the Joint Venture, and the roles, contributions and accountability expectations of each party Gives all parties representation on the organization's board in accordance with their defined roles Allows The City to be actively involved in the appointment of key management staff, including determination of remuneration Requires that The City approve the organization's business plan and annual budget Requires The City to have some responsibility for the financial viability of the organization or program Requires the organization to adopt key City policies concerning business plans, budget determination and accountability where City annual contributions from the operating budget are significant. 36

40 Appendix 2: PARTNERSHIP CATEGORIES DEFINITIONS ALLIANCES Alliances are arrangements that are based on mutual interest. Under this category, The City is primarily a facilitator, providing some key resources, participating in setting of service expectations and keeping informed of outcomes. The other party is responsible for the service delivery. It has full management control of the operational aspects of the arrangement and is responsible for the financial viability of the organization or program. A City Alliance is established through the execution of an agreement, which may have an operating and/or lease component. Under this agreement, The City agrees to provide resources such as land, buildings and/or annual operating funds (generally over $300,000). The agreements should: Outline the purpose, roles, contributions and accountability expectations of each party Outline the conditions based on the nature of the service provided, type of facilities and level of annual funding contribution Require either a City board representative (may be non-voting) or a Business Unit contact to establish a better link with City services and/or provide specialized skills Require Council/City Executive Officers to approve, where appropriate, annual funding to the organizations, and/or rates and fees. In addition, if the organization operates a major City facility; and/or provides a major public service, and/or receives funding (including financing costs) for more than 50% of its gross expenditure, The City and the organization will together Appoint the organization's chief executive officer (or equivalent) Set annual objectives and outcomes Approve major expansion plans or significant changes to the organization's mandate. 37

41 Appendix 2: PARTNERSHIP CATEGORIES DEFINITIONS AGENCIES An Agency is an organization that delivers services on behalf of The City on a fee-for-service basis. The City sets the terms of the delivery but the Agency is responsible for the delivery of the services and overall costs. Agency relationships are established through the execution of an Agency agreement in which The City provides an annual operating grant (usually less than $300,000) to an organization for agreed upon services. Service expectations are determined by the Contact Business Unit and will be based on the nature of the business unit's need and level of annual funding contributions. These relationships: Include organizations that receive one-time funding (not including Preventive Social Services) Do not involve the provision of any land or facilities Outline the purpose, roles, contributions and accountability expectations Do not require a City board representative. If City board representation (may be non-voting) is requested, the representative should be an individual who can facilitate the linkage with City services and/or provide specialized skills to assist the organization. The business unit general manager or designate may approve any fee-for-service. PREVENTIVE SOCIAL SERVICES Preventive Social Service organizations primarily receive City/Provincial funding. This category also includes social service agencies that receive one-time funding under existing policies and procedures for MATCH-Solutions and Innovative/Preventive Funds. The relationship is established through the execution of "The City and FCSS Conditions of Funding Agreement", MATCH-Solutions, or Innovative/Preventive funding agreements. The City's accountability requirements are set out in these agreements and also under the FCSS Act and Regulation. Funding applications are accepted and reviewed each year and Council considers funding allocation recommendations based on its priorities which are set every three years. 38

42 Appendix 2: PARTNERSHIP CATEGORIES DEFINITIONS COMMUNITY ORGANIZATIONS Community Organizations include community associations or social/recreation groups which have a lease or license of occupation with The City and meet the criteria approved by Council for these relationships. This arrangement is established through the execution of a Lease/License of Occupation Agreement. The City provides land (at a nominal fee) for social and recreational purposes but is not obligated to provide funding. The City's accountability requirements are documented under the "Lease/Licensing Policies as approved by Council for community associations and for social/recreation organizations". A best practice model is utilized by the Community and Neighbourhood Services Business Unit to strengthen these requirements giving The City a stewardship role and taking a collaborative approach with the Federation of Calgary Communities (where applicable) and community associations to: Deliver athletic, arts and performing arts, cultural and recreational services Ensure the long-term sustainability of the community organization in delivering community-related services. This category does not include community organizations operating out of major City-owned facilities. These organizations are instead included in the Alliance category (e.g., Regional Recreational Centres). 39

43 Appendix 3: BOARD APPOINTMENT GUIDELINES City of Calgary Appointments The number of persons appointed by The City should be based on The City s responsibilities and obligations as a public trustee as outlined in Table 2. City board representation may be required for Related Entities, Joint Ventures, Alliances and Provincial Legislated Entities as specified in Appendix 2. The City appoints board members where it is required under government legislation or where an organization provides a strategic service for The City. Under this requirement the representatives could be an alderman, executive officer or general manager. In addition, business unit personnel are a resource to the organization s board to provide the operational link to The City, on an as needed basis. In other cases, a representative is required to provide direction on City-related issues; and/or to provide an operational link between The City and the organization. The representative would be a business unit general manager or designate and may be a board member of non-voting status, or act as a liaison. Citizen Appointments Citizen board members selected by The City, should be persons who are dedicated, interested, enthusiastic and represent the community. The designate should have the commitment and time to make decisions that are in the best interest of The City and the organization. Appointments should be made where applicants have: Expressed interest in those positions Identified the skills, experience and other attributes they can provide to the organization Indicated a willingness to make the following commitments to fulfill their fiduciary obligations participate and complete any training services provided by The City on board responsibilities declare potential for conflict of interest before voting on decisions support decisions that further the mandate of the organization recognize The City s fiscal challenges when developing business plans commit the necessary time to fulfill their obligations. 40