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Dollars from developers have become something of a lightning rod around Ottawa’s city hall, with a controversial $300,000 donation leaving councillors seeking a formal policy forbidding them from negotiating these kinds of deals.

“Right now, we don’t really have a process that allows us as councillors to accept or enter into these types of arrangements,” Alta Vista Coun. Marty Carr said in an interview Friday. “We don’t have anything to point to that says, ‘This is not allowed.’”

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The debate was sparked by Capital Ward Coun. Shawn Menard, who negotiated a $300,000 deal with Katasa, the proponent of a 22-storey highrise building at the intersection of Bronson and Carling avenues. The money was to go towards traffic calming and affordable housing in Menard’s ward, but the deal raised the eyebrows of many around the council table, with some councillors saying it didn’t pass the sniff test.

During a contentious debate, Carr brought forward a motion to formalize a councillor’s role in such a scenario. She said the city had an existing policy for voluntary contributions giving city staff authority to negotiate with developers. The Province of Ontario, too, has a community benefits charge bylaw under its Planning Act that cities can use to fund capital costs of public services associated with development, like parks.

But there’s a “policy gap” that does not address a councillor’s role in negotiations with developers, Carr said, and the city needs a policy clearly defining voluntary contributions, community benefit agreements and more “so we don’t end up in this situation the next time around.”

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READ MORE: The $300,000 donation that kicked off a contentious council debate

Kanata North Coun. Cathy Curry proposed a successful motion to spread the $300,000 from Katasa across Ottawa’s 24 wards, but Katasa has taken the money off the table, saying it had initially agreed to the deal because it thought that was something typically asked of developers.

“Unfortunately, in the past week we learned that this donation is not going to the surrounding community and these requests have not been a typical program offered by the city. We believe this was part of the process, and now we know it’s not,” Katasa’s statement said.

“Councillors have said, ‘If I had known that then, I wouldn’t have voted that way,’” Curry said. “Now that we have new information, would we vote differently?”

But, nevertheless, she thinks a policy is required to avoid any perceptions of impropriety.

“I would like to see a very clear statement to staff, to make sure our policy says councillors shouldn’t be involved in community benefit dollars,” she said.

Curry added the city routinely worked with developers on projects that would benefit the community, but councillors didn’t get involved in the process. Rather, the negotiations happen between the community, city staff and developers, she said.

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“It needs to be very clear,” she said. “To be fair to everyone, all councillors are somewhat confused. A policy that is very clear about what a councillor’s role is would be very helpful.”

Menard said he “wholeheartedly supports” the motion that was passed to develop a policy for voluntary contributions.

“An established process would be beneficial,” he wrote in an email.

Mayor Mark Sutcliffe was originally in favour of creating a policy, but then said he thought such voluntary agreements should be banned entirely, with developers giving their community-minded dollars to philanthropic organizations so “there won’t be any confusion about whether that was tied to the development approval process.”

“The public should have confidence that any process involving a development application involving the City of Ottawa is fair and transparent,” Sutcliffe said at the time. “City council are the decision makers about development applications. If, at the same time that a development application is being considered, a city councillor is negotiating a contribution from the development company, it raises the perception that those two things could be connected. It raises that perception in the public’s eye. It raises that perception in the eyes of the developer.”

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Sutcliffe has come under fire for receiving an election campaign donation from Katasa executive Tanya Chowieri despite making a campaign pledge to not take money from developers.

Sutcliffe denied an interview request, but in a statement said his campaign team reviewed every donation and returned several, but “despite these efforts, a donation from the executive of a development company was processed and not returned.

“This is the first I have heard of this contribution, and it was not identified when the media and others reviewed the list of contributors that was filed with the elections office. If I had known about it previously, it would have been returned immediately.”

While Sutcliffe pledged to not accept money from developers, election donation records for his campaign show dozens of donations totalling nearly $25,000 from construction companies, engineering firms and other businesses connected to the broader development ecosystem.

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