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Infrastructure &
Finance Division
 

Local Government Corporations

 

Authority

The Community Charter, section 185, provides the authority for municipalities to incorporate a local government corporation. The Local Government Act, section 195, provides a parallel authority for regional districts.
 

The approval process governed by these Acts aims to safeguard the “public interest”, while providing a balance between local government broad powers and autonomy and the transparency and accountability owed to the electorate.
 

Guide

Launching and Maintaining a Local Government Corporation: A Guide for Local Officials (716 KB), was developed to provide general advice on creating a local government corporation for those elected officials and staff considering creating a corporation or acquiring shares in a corporation. The Guide includes information about various legal vehicles that may be appropriate for a proposed enterprise and raises issues for local governments to consider before they request Ministry approval for a corporation or share acquisition. If establishing a corporation is the appropriate approach, the guide provides recommendations for:
  • advice that should be obtained prior to incorporation from business, legal and financial specialists;
  • important considerations for corporation setup;
  • provincial regulations and federal tax laws that impact local government corporations; and
  • risk management.

Approval Process and Checklist

The approval of the Inspector of Municipalities must be obtained before a corporation is created or shares are acquired. Local governments are required to submit various materials to the Ministry both prior to and after an approval is granted. The checklist on page 36 and 37 of the Guide outlines the information the Inspector and staff require to review a request for approval. The key items include:
  • Cover letter outlining responses to key issues including:
    • municipal objectives
    • municipal control
    • financial exposure of the municipal shareholder
    • conflict of interest guidelines
    • duty of directors
    • consultation and public input
  • Certified copy of council resolution
  • Background report evaluating the decision to create the corporation
  • Articles in final draft form

Once the incorporation is complete, the Ministry requires additional information for its records:

  • Certificate of incorporation
  • Certified copy of Incorporation application
  • Certified copy of Notice of Articles
  • Articles in final approved form.

Listing of Active Local Government Corporations

The Ministry annually provides a list of local government corporations (85 KB) that have received Inspector approval and have been registered with the Registrar of Companies. The list provides information about which local governments currently have shares in corporations, the corporate name, incorporation date and the nature of the enterprise. The intent of posting this information on the website is to provide a public record of the Inspector's corporation approvals as a public resource.
 

Please contact the financial analyst responsible for your area if you have questions or comments.
 

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