New Elector Approval Exemption – Interests In Land

In November, 2007, the B.C. Legislature brought into force the Approval of the Electors Exemption Regulation, B.C. Reg. No. 358/2007 (the “New Regulation”), which grants municipalities and regional districts the ability to enter into certain commitments under agreements relating to land, or an interest in land, without the necessity of obtaining the approval of the electors. The exemption under the New Regulation applies to a commitment that the local government maintain land, or that the local government indemnify the grantor of the interest or right in land being acquired by the local government, or both. Such commitments might typically arise in a lease or a statutory right of way.

Commitments to maintain land, or to indemnify the owner of land against loss or damage, often involve capital expenditures, or at least the possibility of capital expenditures that would exceed the five-year threshold for municipalities under Section 175(2) of the Community Charter, and the “approval-free liability zone” under Section 7 of the Municipal Liabilities Regulation, B.C. Reg. 254/2004 and, for regional districts, section 819 of the Local Government Act and section 2 of the Regional District Liabilities Regulation, B.C. Reg. 261/2004.

However, the exact nature and extent of the expenditures involved is usually impossible to predict in advance, leaving the cautious local government no choice but to seek approval of the electors before committing to a potential expenditure that may or may not ever arise. To make matters worse, in seeking approval of the electors the local government may not be able to put forward more than a vague estimate of liability for them to consider.

The New Regulation provides some welcome clarity to the issue, removing not only the requirement for approval of the electors, but also doing away with the necessity of working through calculations to determine if other statutory exemptions apply. It does not matter whether the term of an agreement is more or less than five years, whether the commitment(s) under that agreement are of a capital nature or not, or even how much they might cost the local government. As long as those commitments are in relation to land or an interest in land acquired by the local government, and involve either maintaining the land or indemnifying the owner of the land, or both, then they are exempt from approval of the electors.

Many other liabilities remain subject to the elector approval requirements of the Community Charter, and whenever in doubt a local government should seek legal advice.

Michael Hargraves

This article was published in Winter 2007/2008 and may be superseded by changes in the law at a later date. It is for general information only. Specific legal advice should be obtained from a qualified lawyer.