Per Diems Must Be Introduced for Boards

Per Diems for BIA Board members are long overdue. Toronto milks BIAs for millions annually and has never shown any appreciation or generosity towards those who serve the city’s interests. In fact, some councillors (thankfully not all) not only provide little support… they only get involved when it’s in their political interests to meddle. Otherwise, they keep tabs (spying) on the BIAs by sending a constituency staffer to attend meetings.

There are 15 of 44 wards without BIAs. The 29 which have BIAs are a great source of additional taxes for the city. They are encouraged to provide improvements, ostensibly for their members, but in reality, the improvements invariably go to upgrading street assets. This ‘encouragement’ is tendered with offers of sharing 50/50 the costs of these improvements. Sometimes the sharing is 65/35 (the BIA carrying the greater part).

And these splits are dressed up as a contribution from the City to a BIA (as if the money is not sourced from the same taxpayers!) and, when the Boards agree to any project – Council insists that the city must manage the project without the BIA’s participation (other than providing their share of funds).

When BIA Boards agree to these and other expenditures; when they agree to these projects as well as the maintenance which follows (the costs of maintenance are NOT shared), they are neither recognized, nor appreciated, nor thanked. In fact, if they exercise any due diligence and fire off any questions to the OED (Office of Economic Development) about cost overruns, Boards are given the mushroom treatment and invariably manipulated and deceived.

Little wonder then, why anyone in their right mind would volunteer to serve on these Boards. A paucity of interest and enthusiasm leads to mediocre participants and contributes to low or poor productivity. These conditions, if changed, could lead to a greater, more inspired performance of all the players.

Paying the Board members per diems will be a proper move in the right direction.

In Ontario, BIAs are considered to be agencies of their respective city – that is to say their mandate comes from their City Council; their Boards are approved by City Council.

And the cities are given the authority to create, appoint and work with BIAs by the provincial legislation which governs BIA operations and procedures, known as Chapter 19.

A BIA is composed of two types of members; merchant retailers and commercial property owners. These members gather once a year at an Annual General Meeting (AGM) to approve and implement their respective budgets for the next year, going forward. AGMs are often used to add BIA members to an existing Board of Management (the Board).

Boards can have anywhere from three (the bare minimum) to as many as fifteen (or more) members. These members are nominated by the BIA members, and thereafter, appointed to the Board by City Council. If the Board is new (every four years, after every municipal election), its members choose from amongst themselves, their Table Officers. These are the Chair, the Vice Chair, the Secretary and the Treasurer. The remaining Board members serve as Directors.

This Board now becomes the Executive of the BIA. It manages the affairs of the BIA during its term. The Executive meets a minimum of four times each year. Most Executive Boards meet monthly. Their meetings usually last between two to three hours.

It’s interesting to note that these volunteers donate their time without being remunerated. This contribution, from individuals who also have a business to operate or commercial property to manage, can be burdensome. It should be obvious to any observer that a business operator’s first priority is to generate revenue in order to meet its own business commitments. Accordingly, for every hour a volunteer spends in other pursuits, such as serving on the BIA Board, means one less hour available for their business priorities.

The result is that few volunteers come forward to serve on BIA Boards. Simply because there’s no profit or return for the effort expended. Even worse, there is never any gratitude for their contribution and sometimes, personal differences between the members give rise to political conflicts and personal vendettas.

Which makes for unhealthy circumstances – unpaid volunteers, unrecognized effort, no benefits and certainly no gratitude. This creates environments not conducive to hard work, creativity and enthusiasm. It also results in most BIA Boards hiring staff to perform whatever duties would normally fall on the Board volunteers.

In theory, the Chair sets the agenda and conducts meetings. The Secretary records the Minutes and the Treasurer keeps the books. In practice, most Boards hire a staffer to perform these tasks (except for actually conducting the meetings), while the volunteers simply meet for dialogue and decisions.

Under such organization, there is little incentive to improve or excel.

An alternative approach that should be considered, discussed and hopefully implemented, is to provide per diem payments to all who serve on these BIA Boards. Before this is done, certain measures have to be put in place.

  • The number of Board members should be capped – perhaps a maximum of ten.

  • Per diems will be collected based on attendance.

  • Those BIAs which do not have staff should compensate their Table Officers for the extra work involved. An example would be to pay the Chair $75 per meeting, the Treasurer and Secretary $60 each and the Vice-Chair and Directors a flat $50 per meeting.

  • For those BIAs which have staff (and where the staff is hired to perform the work of the Table Officers), then everyone gets a flat $50 per meeting.

Such an arrangement will cost a BIA approximately $6,000 per year. This amount is a pittance compared to the wages paid to staff or the purchases of banners, flowers, social media, websites, etc.

Such an initiative will result in considerable improvements in Board management and quality of governance. Here’s why:

  • If per diems are paid, volunteers will have a greater interest in serving, knowing their efforts are compensated.

  • A greater number of volunteers will come forward. Since there will be a limit on how many can serve, there will be greater competition.

  • The increase in competition (currently none exists) will result in a better quality of volunteer/candidates being nominated. At this time, anyone can volunteer, regardless of knowledge, ability, skills, expertise or intelligence.

  • The improvement in the quality of Board members will benefit the BIAs through better management due to a better quality of appointed volunteers.

This change will not miraculously improve matters overnight. However, within a year or two, better candidates will gradually replace those less qualified. Eventually, the Boards will become more productive, efficient and expert.

And finally, nothing in Chapter 19 restricts per diems.

Styli Papatheodosiou. December 15.17

Full disclosure – author does not serve on any BIA Board in Ontario.

 

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