Council split over backing BIA on unexpected legal expense

Jeff Helsdon, Local Journalism Initiative Reporter

Tillsonburg council was divided over a request to fund an unexpected legal bill from the Tillsonburg Business Improvement Association.

The BIA board of directors, of which Coun. Bob Parsons is the chair, wrote a letter to council asking the town to forgive a loan for an unexpected legal expense of $21,054. Staff suggested funding the request from the town’s Tax Rate Stabilization Reserve.

Parsons explained the BIA has changed its financial procedures and the direction going forward is to set up reserve funds to cover anything like this in the future.

“I think that it’s important to set the BIA up for success,” he said. “The debt they occurred was unbudgeted. They’re not in a position to handle that.”

Councilor Chris Parker questioned whether the Tax Rate Stabilization Reserve was the best place for the money to come from.

Director of Finance/Treasurer Renato Pullia indicated it was.

Parker agreed the BIA is doing a good job, but said, “I don’t think these fees should be coming from the taxpayers of Tillsonburg. This was not a council decision to incur this cost. Just because they didn’t budget for it, doesn’t mean the taxpayer should have to.”

Coun. Pete Luciani countered that the BIA is a subcommittee of council.

“I’m not sure downtown business people should be responsible,” he said. “If any committee has legal issues, I don’t think it should be up to those committees to come up with those funds.”

Coun. Kelly Spencer agreed with Luciani, adding that she has heard from two business owners who were upset that the BIA could be on the hook for the bill.

“Mostly they were concerned why would this be put on the back of small business, especially with the struggles they have been through during the pandemic,and two, that the BIA went above and beyond for support through the pandemic. They questioned why this would not go through the town,” she said.

Mayor Deb Gilvesy questioned the process, asking if the BIA shouldn’t have come to council to request the funding before spending the money.

Pullia said the letter in the council agenda should suffice as a request, although it was after.

“I’m going to say it is in contravention of the act,” she said. “They need to come before the money was spent, and I believe it was after.”

The mayor questioned further if there was a budgeted expense in the BIA budget for legal fees.

“Rather the proper position was followed or not, we are in a position right now where this has occurred and I agree with you there is process, and if it was or was not followed properly that needs to be addressed moving forward,” Luciani answered.

Parsons didn’t have an answer offhand if the BIA would run a deficit if the town didn’t fund this. Noting there was $329,000 in the tax stabilization reserve and a lot is committed from it in 2025 and 2026 budgets, Gilvesy asked and was told the recommended amount in the reserve should be $1-$1.5 million.

Gilvesy said she won’t support the motion because the reserve is low and there are some unanswered questions.

In the end, the motion was carried with a split vote from council.