Legal proceedings ordered for Horizon Ottawa in connection with election expenses

Ottawa City Hall is seen in this undated file photo. (CTV News Ottawa)

A City of Ottawa committee has decided to commence legal proceedings against Horizon Ottawa following an audit into the group's expenses during the 2022 municipal election.

An audit was called following a complaint accusing Horizon Ottawa of benefiting from an event called "Horizonfest" in September 2022. Auditors found Horizon Ottawa appeared to have contravened three campaign finance rules under the Municipal Elections Act (MEA) relating to expenses incurred outside of the allowable campaign finance period and the collection of ineligible donations, which were not returned to the city.

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Horizon Ottawa describes itself as a municipal-focused grassroots organization whose goal is to cultivate local solidarity around socially and economically progressive priorities.

On Wednesday the Election Compliance Audit Committee approved legal proceedings against Horizon Ottawa, saying it would be in the public interest.

At issue is $947.24 worth of expenses Horizon Ottawa incurred outside the advertising campaign period related to the Horizonfest event, including a liquor license with an invoice dated June 17, 2022, a charge for a theatre stage with an invoice dated July 12, 2022, a tarp purchase dated Aug. 17, 2022, and a bank of phone credits found to have been made prior to the date of registration as a third-party advertiser. Auditors also found the anonymous cash donation jar that was used to collect money for the campaign during the event that totalled $448.15 and should have been returned to donors or to the City Clerk because Horizonfest did not meet the criteria as a fundraising event under the Municipal Election Act. The audit also said Horizon Ottawa's financial records were not appropriately maintained.

Horizon Ottawa maintains that it disagrees with the auditor's findings. At committee, Horizon Ottawa said that its understanding is that an expense is “incurred” when the good or service in question is used and that none of the expenses at issue were used prior to its registration as a third party advertiser. Horizon Ottawa also argued that the apparent contravention related to the donation jar was a simple misclassification in its financial statements and that it reported the amount and made no attempt to obscure any monies received.

The committee disagreed.

Minutes from the committee meeting outlined the decision.

"At the time it incurred the impugned expenses, Horizon Ottawa had not yet registered as a third party advertiser. It later changed its mind and opted to register. The Committee finds this decision flowed, at least in part, from Horizon Ottawa’s decision to have select municipal candidates participate in Horizon Fest. This made Horizon Fest a third party advertisement under the MEA. In that regard, the impugned expenses became campaign expenses, for the MEA’s purposes, upon Horizon Ottawa deciding to participate in the election as a third party advertiser. By incurring the expenses before the campaign period, Horizon Ottawa gained an advantage in its campaign activities. The MEA imposes a campaign period, in part, to prevent just such an advantage," the summary says.

"With respect to the other two apparent contraventions referenced in the audit report—collection of cash donations and deficient recordkeeping—the Committee accepts the auditor’s opinion that these items are apparent contraventions. Regarding the cash donations accepted at Horizon Fest, the Committee takes note of Horizon Ottawa’s written submission that it was entitled to accept anonymous donations under $25 in relation to third party advertisements as “contributions”. Accepting Horizon Ottawa’s submission at face value, Horizon Fest was in fact a third party advertisement regulated under the MEA."

The City Clerk has been directed to retain and refer the matter to an independent prosecutor.

In a statement following the meeting, Horizon Ottawa claimed the audit process had been "weaponized" against it.

"This has been nothing more than a fishing expedition started by someone who disagrees with Horizon Ottawa’s vision and mission," a media release said. "This process should not be permitted to be weaponized by the wealthy and well-connected in our city as a way to interfere with legitimate, transparent, democratic participation."

The group said it was disappointed with the committee's decision, but looks forward to vindication in court.

"We maintain that we acted with transparency and integrity throughout the 2022 election. We diligently prepared a financial return, underwent an audit by our own independent auditor and fully participated in the audit by the city-appointed auditor. As the report shows, there was never any attempt to obfuscate the nature of our revenues or expenditures or to characterize transactions in a particular way to gain an advantage," Horizon Ottawa said. "We are looking forward to being fully vindicated in the judicial proceedings to come."