Rural Utilities Regulation

(Consolidated up to 201/2024) ALBERTA REGULATION 151/2000 Rural Utilities Act RURAL UTILITIES REGULATION Table of Contents 1 Definitions 2 Forms and fees 3 By‑laws 4 Corporate name 4.1 Secondary objects 5 Registered office 6 Functions and duties of the auditor 7 Auditor at meetings 8 Minimum amount of reserve 9 Uses of reserve 10 Investment of reserve 11 Distribution of reserve 11.1 Surplus funds from secondary objects 12 Loans or guarantees by associations 13 Change in service status 14 REA grants 14.1 Sale of works to another rural electrification association 15 Sale of works 16 Amalgamation agreements 17 Approval of agreement 18 Amalgamation 19 Federations 20 Expiry 21 Repeals Schedules Definitions 1 In this Regulation, (a) “Act” means the Rural Utilities Act ; (b) “board” means the board of directors of an association; (c) “Director” means the appropriate Director as defined in the Act; (d) “reserve account” includes the deposit reserve account of a rural electrification association. Forms and fees 2 (1) The forms in Schedule 1 are the forms prescribed for the purposes of the Act. (2) The fees in Schedule 2 are the fees payable to the Registrar for services under the Act. By‑laws 3 The by‑laws in Schedule 3 are the standard by‑laws for associations. Corporate name 4 In addition to complying with the Act, the name of an association must comply with the requirements of the Cooperatives Regulation (AR 55/2002). AR 151/2000 s4;109/2008 Secondary objects 4.1 (1) If an association amends its memorandum of association in accordance with section 6 of the Act, the memorandum of association may only include as a secondary object the provision of fibre‑optic goods and services. (2) Notwithstanding subsection (1), an association, in addition to its principal objects, may continue to carry out secondary objects (a) listed in its memorandum of association that was approved by the Director and filed with the Registrar prior to the coming into force of this section, or (b) authorized by the directors of the association prior to the coming into force of this section in accordance with an express authority in the memorandum of association. (3) Notwithstanding subsections (1) and (2), if one or more amalgamating associations have as secondary objects those objects referred to in subsection (2), the amalgamating associations may include any of those secondary objects in the amalgamation agreement under section 16. (3.1) Notwithstanding subsections (1) and (2), if a rural electrification association has secondary objects referred to in subsection (2) and is selling all of its works under section 23(2) of the Act, the rural electrification association purchasing all of the works may amend its memorandum of association, in accordance with section 6 of the Act, to include any of the secondary objects. (4) An association may only carry out the secondary object referred to in subsection (1) by doing one or more of the following: (a) by incorporating (i) a corporation under the Business Corporations Act or the Canada Business Corporations Act (Canada), or (ii) a cooperative under the Cooperatives Act ; (b) by holding shares in or being a member of a corporation or a cooperative referred to in clause (a); (c) by holding all or a portion of the debt of a corporation or a cooperative referred to in clause (a); (d) by entering into an agreement or arrangement with a corporation or a cooperative referred to in clause (a). AR 60/2023 s2;201/2024 Registered office 5 (1) An association must at all times have a registered office in Alberta. (2) Notice of the address of the registered office must be given to the Director at the time of application for incorporation. (3) The board of an association may change the address of the registered office and notice of the change must be filed with the Director within 15 days from the day that the change becomes effective. (4) The address for service by mail on an association is the latest address of the registered office filed with the Director. Functions and duties of the auditor 6 (1) The auditor is to make a report to the members (a) on the results of the audit with respect to the reserve account, and (b) on the financial statement of the association and that report must be laid before the membership at an annual meeting of the association. (2) The auditor’s report must include the auditor’s opinion as to whether the financial statement referred to in the report presents fairly, in accordance with generally accepted accounting principles applied on a basis consistent with that of the preceding period, if any, the financial position of the association and the results of the association’s operations for the period under review. (3) The auditor, in the auditor’s report, must also make any statements the auditor considers necessary in any case where (a) a financial statement is not in agreement with the accounting records, (b) a financial statement is not in accordance with the requirements of the Act, (c) the auditor has not received all the information or explanations that the auditor has required, or (d) the auditor’s examination indicates that proper accounting records have not been kept. AR 151/2000 s6;109/2008 Auditor at meetings 7 (1) The person responsible for giving notice of meetings of an association must notify the auditor of all general and special general meetings of the association. (2) If (a) at least 10% of the members of an association notify the association in writing at least 7 days before a meeting of its members that they wish the auditor of the association to attend the meeting, or (b) the Director advises the association that the Director wishes the auditor of the association to attend the next meeting of the association’s members, the association must forthwith request the auditor to attend the meeting, and on being so requested the auditor must attend the meeting. Minimum amount of reserve 8 The Minister may, for each association, establish the minimum amount to be maintained in the reserve account required under the Act for the purposes of replacement, extension or increase in capacity of the works of the association. Uses of reserve 9 (1) The reserve account may be used for the following purposes: (a) to provide funds for the partial or total replacement of the association’s works; (b) to provide funds for the extension, improvement or upgrading of the association’s works as required from time to time; (c) to meet any demand under an agreement made pursuant to subsection (2); (d) any purpose not referred to in clauses (a) to (c) that is prescribed by a supplemental by‑law. (2) On terms and conditions approved by the Director, an association may enter into a reciprocal agreement with one or more other associations supplying the same type of utility service whereby a portion of each reciprocating association’s reserve account is available to the other reciprocating association as an emergency fund for the replacement or reconstruction of works damaged by abnormal weather or other natural causes. (3) The reserve account must be maintained in an account separate from any account used to fund the secondary object referred to in section 4.1(1). (4) Notwithstanding subsection (1), where surplus funds received by an association from carrying out the secondary object referred to in section 4.1(1) are held in the reserve account, the surplus funds may only be used in accordance with section 11.1. AR 151/2000 s9;60/2023 Investment of reserve 10 (1) Where an association maintains its own reserve account, the board must invest the money in the account in the following: (a) bonds, debentures and other forms of indebtedness of or guaranteed by the Government of Canada or the government of any province; (b) bonds, debentures and other forms of indebtedness of an agent of the Crown in right of Alberta; (c) certificates of deposit, deposit receipts and other deposit instruments offered by a bank, treasury branch, trust company or credit union in Alberta; (d) any form of investment not referred to in clauses (a) to (c) that is approved by a supplemental by‑law. (2) Repealed AR 109/2008 s4. (3) Notwithstanding subsection (1), an association that owns a rural gas utility may invest money referred to in subsection (1) in shares and subordinated debt instruments, or either of them, issued by Gas Alberta Inc. AR 151/2000 s10;109/2008 Distribution of reserve 11 Subject to section 15, the board may, with the approval of the Director, authorize the distribution of all or part of the reserve account (a) in accordance with any by‑laws of the association that provide for a distribution of the reserve account, or (b) where there are no by‑laws referred to in clause (a), equally among the members of the association. AR 151/2000 s11;109/2008 Surplus funds from secondary objects 11.1 (1) In this section, “capital asset” means a non‑financial infrastructure asset having a physical substance that is acquired, constructed or developed and (a) is held for use in the production or supply of goods and services, for rental to others, for administrative purposes or for the development, construction, maintenance or repair of other tangible capital assets, (b) has a useful life extending beyond one year, (c) is intended to be used on a continuing basis, (d) is not intended for sale in the ordinary course of operations, and (e) includes the association’s works. (2) Surplus funds received by an association from carrying out the secondary object referred to in section 4.1(1) may only be used to acquire, maintain, upgrade or modernize capital assets. AR 60/2023 s4 Loans or guarantees by associations 12 An association may make loans or guarantees to or on behalf of any one of the following: (a) Gas Alberta Inc.; (b) Corridor Communications Inc. AR 151/2000 s12;26/2010 Change in service status 13 (1) When an association (a) ceases to provide utility service to a member because of a change in the member’s service status, and (b) sells or transfers the part of its works that provided the service to that member to the utility company that assumes the provision of that service to the member, the proceeds of the sale or transfer must be applied in accordance with this section. (2) In the case of a rural electrification association the proceeds must be applied (a) first, in payment of any money owing by that member to the association in respect of lien notes under the Rural Electrification Loan Act or the Rural Electrification Long Term Financing Act, (b) second, in payment of any money owing by the member to the association, and (c) third, in payment to the member to the extent permitted by subsection (3), and any balance remaining must be deposited in and forms part of the association’s reserve account. (3) A payment under subsection (2)(c) shall not exceed the greater of (a) the original cost to the association of the works sold, and (b) the capital contribution the member is required to make to the utility company to receive the utility service from the utility company. (4) In the case of a natural gas, water or sewage association, the net proceeds of the sale must be deposited in and form part of the association’s general account. (5) In this section, “member” includes a person who ceases to be a member of the association because of the change in the member’s service status. AR 151/2000 s13;109/2008 REA grants 14 (1) Where a rural electrification association administers its own deposit reserve account, the board (a) must deposit all grants to the association under the Ministerial Grants Regulation (AR 215/2022) in a grant reserve account separate from any other reserve account of the association, (b) must invest the money in the grant reserve account in investments authorized by section 10(1)(a) to (c) and deposit any income from the investment in that account, and (c) shall not disburse or transfer any of the money in the grant reserve account without the approval of the Director, except in payment to the Minister, in favour of the President of Treasury Board and Minister of Finance when so required by the terms of the grant. (2) Where a grant reserve account exists, the board must annually cause an audit of the grant reserve account to be carried out and must (a) report the results of the audit with respect to the grant reserve account either as a note within the general financial statement of the association or in a separate financial statement, and (b) present the results of the audit to the membership at the annual general meeting of the association. (3) Sections 8 to 13 do not apply to a grant reserve account established under this section. AR 151/2000 s14;27/2002;68/2008;109/2008; 31/2012;62/2013;9/2023;201/2024 Sale of works to another rural electrification association 14.1 (1) In this section, (a) “purchasing association” means a rural electrification association that proposes to buy all of the works of a selling association; (b) “selling association” means a rural electrification association that proposes to sell all of its works to a purchasing association. (2) If, under section 23(2) of the Act, a selling association proposes to authorize the sale of all of its works to a purchasing association, the selling association may sell all of its works to a purchasing association if (a) the selling association and the purchasing association enter into a written sale agreement that complies with this section, (b) the written sale agreement is approved in accordance with subsection (7), and (c) the selling association makes the disclosure required in subsection (8). (3) The sale agreement must include, (a) if the purchasing association is offering loans to members of the selling association or the purchasing association as part of the sale, the terms of the loans, and (b) any information relating to reserve accounts that is required under subsection (4). (4) Subject to section 14(1)(c), the selling association may transfer all or part of the money in its reserve account to the reserve account of the purchasing association, and if all or part of the money in its reserve account is being transferred, the sale agreement must include the amount of the transfer from the reserve account of the selling association to the reserve account of the purchasing association. (5) If, under subsection (4) and section 14(1)(c), any money is transferred from a grant reserve account by a selling association to a purchasing association and the purchasing association administers its own deposit reserve account, the purchasing association must deposit the money in a grant reserve account that is separate from any other reserve account of the purchasing association. (6) Section 15 applies if any money remains in the reserve account of the selling association after the sale of all works has occurred. (7) In addition to the authorization required in section 23(2) of the Act, the sale agreement must be submitted to the members of the selling association and the purchasing association for approval by extraordinary resolution at a general meeting of each association. (8) At the general meeting of the purchasing association in subsection (7), the purchasing association shall disclose to the purchasing association’s members any reasonably expected costs related to the purchase that are not included in the sale agreement. (9) On the date that a sale of all works under this section occurs, all members of the selling association (a) remain members of the selling association, and (b) become members of the purchasing association. (10) If a sale agreement has been approved in accordance with subsection (7) and the sale of all works has occurred, the selling association and purchasing association must jointly present a copy of the following to the Director: (a) the sale agreement; (b) the extraordinary resolution of each association approving the sale agreement, certified to be a true copy by the chair and secretary of each association. AR 201/2024 s4 Sale of works 15 Without limiting section 14.1(4), where an association sells all of its works, the sale proceeds and the amount in the reserve account shall be distributed among the members on the basis of the number of utility service contracts held, and the distribution must be made (a) in accordance with a method of distribution approved by the membership at a special general meeting of the association called to authorize the sale of the works, or (b) where there is no method referred to in clause (a), equally for each service contract held. AR 151/2000 s15;109/2008;201/2024 Amalgamation agreements 16 (1) Any associations proposing to amalgamate must enter into an amalgamation agreement. (2) An amalgamation agreement may (a) prescribe the terms and conditions of the amalgamation and the mode of carrying the amalgamation into effect, and (b) set out at least the following: (i) the corporate name of the amalgamated association; (ii) the terms of membership; (iii) the objects of the amalgamated association; (iv) the number of directors, until changed by the by‑laws of the amalgamated association; (v) the names and respective terms of office of the first directors; (vi) any other matters that may be necessary to effect the amalgamation and to provide for the subsequent management and working of the amalgamated association. (3) An amalgamation agreement may (a) provide for the adoption of the supplementary by‑laws of one of the amalgamating associations as being the by‑laws of the amalgamated association, or (b) have annexed to the agreement new supplementary by‑laws for the amalgamated association. (4) The amalgamation agreement must be submitted to the members of each amalgamating association for approval by extraordinary resolution and, if so approved, the amalgamation agreement must be presented to the Director for the Director’s approval together with the following: (a) a copy of the extraordinary resolution of each amalgamating association, certified to be a true copy by the chair and secretary of each amalgamating association; (b) notice of the location of the registered office of the amalgamated association; (c) if the name of the amalgamated association is not to be identical to the name of one of the amalgamating associations, the documents required by section 13 of the Cooperatives Regulation (AR 55/2002); (d) the fee payable to the Registrar; (e) a copy of the supplementary by‑laws, if any. AR 151/2000 s16;109/2008;201/2024 Approval of agreement 17 (1) The Director may (a) approve an amalgamation agreement as presented, or (b) approve an amalgamation agreement subject to compliance with any terms and conditions that the Director thinks fit having regard to the public interest and the rights and interests of all parties, including dissenting members and creditors of the amalgamating associations. (2) If the Director approves the amalgamation agreement, the Director must, subject to proof of compliance with any terms and conditions imposed, deliver the documents and fee to the Registrar. (3) Notwithstanding subsection (2), if the Director does not approve the amalgamation agreement or if the terms and conditions are not complied with, the Director must return the documents and fees to the persons from whom the Director received them. Amalgamation 18 (1) On receipt of the documents and fee, the Registrar must register the amalgamation agreement and issue a certificate of amalgamation in a form determined by the Registrar. (2) On the issuance of the certificate of amalgamation, (a) the amalgamating associations are amalgamated and are continued as one association, (b) the amalgamated association possesses all the property, rights, privileges and franchises and is subject to all the liabilities, contracts and debts of each of the amalgamating associations, and (c) all the provisions of the amalgamation agreement are deemed to constitute the memorandum of association of the amalgamated association. (3) If the amalgamation agreement does not provide for the adoption of the supplementary by‑laws of one of the amalgamating associations or for new supplementary by‑laws for the amalgamated association, the amalgamated association may make supplementary by‑laws in accordance with the Act. Federations 19 (1) In this section, “federation” means (a) the Alberta Union of Rural Electrification Associations Co‑operative Limited that is continued as a corporation under the Act and that is now known as the Alberta Federation of REAs Ltd., (b) the Federation of Alberta Gas Co‑operatives Ltd. that is continued as a corporation under the Act, or (c) a corporation incorporated pursuant to subsection (2). (2) The Minister may, on application to the Minister, authorize the incorporation of a corporation, membership in which is limited to associations or to associations of a specified class or type. (3) The provisions of the Act and this Regulation apply, with all necessary modifications, with respect to federations as if they were associations, except that a federation may not do any of the following: (a) own any works; (b) engage in the business of supplying to member associations or to any other person any of the utility services for which an association may be incorporated under the Act to provide; (c) borrow money from a member association; (d) lend money to a member association or to any other person. (4) Notwithstanding subsection (3), the Federation of Alberta Gas Co‑operatives Ltd. may hold a special share issued by Gas Alberta Inc. (5) The memorandum of association or supplementary by‑laws of a federation may contain provisions (a) authorizing the representation of member associations by delegates; (b) establishing the basis for determining the number of delegates each member association is entitled to; (c) respecting the time and method of electing or appointing delegates and their terms of office. (6) Except as provided in this section, the memoranda of association and the supplementary by‑laws (a) of the federation referred to in subsection (1)(a) continue in effect as the memoranda of association and the supplementary by‑laws of that federation, and (b) of the federation referred to in subsection (1)(b) continue in effect as the memoranda of association and the supplementary by‑laws of that federation. Expiry 20 For the purpose of ensuring that this Regulation is reviewed for ongoing relevancy and necessity, with the option that it may be repassed in its present or an amended form following a review, this Regulation expires on September 30, 2030. AR 151/2000 s20;354/2003;46/2008;109/2008;138/2013; 84/2018;270/2020;92/2022;201/2024 Repeals 21 (1) The Rural Utilities Regulation (AR 253/86) is repealed. (2) The Standard By‑laws (AR 254/86) are repealed. Schedule 1 Form 1 Rural Utilities Act Memorandum of Association Name Address Occupation WE, 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. desire to form an association under the Rural Utilities Act . The corporate name of the Association is to be . The objects for which the Association is to be formed are: There is to be no share capital. The terms of the membership are the payment of a membership fee of $1.00 and the entering into a contract with the Association for the purchase of and the payment of the contribution to construction and extension line costs as required in the contract. The contract is to be in a form approved by the directors. The directors have the right to refuse membership to any person. The number of directors who are to direct and supervise the concerns of the Association are or such other number as may from time to time be determined by the by‑laws of the Association. The names of such directors, until their successors are elected under the by‑laws of the Association, are: The name of the place at which the head office or principal place of business is to be situated is , Alberta. Date: WITNESS: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Form 2 Rural Utilities Act Notice of Removal of Idle Service To: (owner of land) Re: (description of land) (hereinafter referred to as the “Association”) is no longer supplying service to the above land and, under the Rural Utilities Act , the association is empowered, after giving you notice, to enter the above land and remove its idle works. The Act provides that you first be given the opportunity of entering into either one of the following types of agreements: 1. The idle works may be removed, in which case, your contract and membership with the Association is terminated. At some later date, should you re‑apply for service at this location, you will have to pay either the installation cost paid by other members of the Association or the actual cost of the installation, whichever is the greater. 2. You may, if you wish, agree in writing to pay the basic operating charges plus any levies assessed by the Association on its regular billing. Should you fail to meet the payments agreed to in due course, the idle works will be removed as set out in paragraph 1. If you wish to enter into one of the attached agreements, please complete it in duplicate and forward it to , Alberta without delay. If you fail to enter into agreement with the Association within 60 days from this date, the above service may be removed at the discretion of the Association. Please note: Removal of the idle works will not affect any indebtedness under any lien note registered against the title to the land pursuant to the Rural Utilities Act , the Rural Electrification Loan Act or the Rural Electrification Long Term Financing Act . Dated: (name of Association) per Form 3 Rural Utilities Act Removal of Idle Service Agreement Between: (hereinafter referred to as “the owner”) and (hereinafter referred to as “the Association”) With respect to the works owned by the Association that are situated on and intended to provide service to (hereinafter referred to as the “owner’s land”) but which is not now being used to provide that service to that land, IT IS AGREED as follows: 1(1) The service contract, if any, with respect to the owner’s land is terminated. (2) The owner’s membership, if any, in the Association is terminated. 2 The Association may, through its employees or agents, enter on the owner’s land at any reasonable time and remove all or any part of the idle works. Note - include only the paragraph 3 that is appropriate. 3 The proceeds from the removal and sale of the works are the property of the Association and the owner has no further claim on the Association. OR 3 The net proceeds from the removal and sale of the works, after all outstanding indebtedness has been paid, are to be paid to the owner and the owner has no further claim on the Association. 4 If the owner hereafter applies to the Association to have the utility service to the owner’s land re‑established, the owner shall pay (a) the average installation cost paid by other members of the Association, as determined by its board of directors at the time of application, or (b) the actual cost of installation, whichever is the greater amount. 5 The Association is hereby granted and has a right of way for erecting, maintaining and removing its distribution system and the line extensions, including the right to carry out the necessary trimming and cutting of trees and brush, on and over any part of the right of way on the owner’s land as may be necessary to complete the connection or branch from any extension as the Association, for its reasonable convenience, requires to enable it to serve other consumers. Dated: (witness) (member) (name of Association) per (witness) chair (witness) secretary Form 4 Rural Utilities Act Maintenance of Idle Service Agreement Between: (hereinafter referred to as “the owner”) and (hereinafter referred to as “the Association”) With respect to the works owned by the Association that are situated on and intended to provide service to (hereinafter referred to as “the owner’s land”) but which are not now being used to provide that service to that land, IT IS AGREED as follows: 1. The Association will not remove the idle works from the owner’s land and will maintain them in good order during the term of this agreement. 2. For the maintenance of the idle works the owner will pay to the Association, when due, the basic operation and maintenance charges payable under a service contract, plus any deposit reserve or other levy made under the Rural Utilities Act . 3. If the owner defaults in any payment due pursuant to paragraph 2, and after its normal procedures for the collection of arrears have been followed, the Association may terminate this agreement and proceed under the Rural Utilities Act to authorize the removal of all or part of the works from the owner’s land. 4. This agreement, except paragraph 5, terminates if the provision of the utility service to the owner’s land is resumed. 5. The Association is hereby granted and has a right of way for erecting, maintaining and removing its distribution system and the line extensions, including the right to carry out the necessary trimming and cutting of trees and brush, on and over any part of the right of way on the owner’s land as may be necessary to complete the connection or branch from any extension as the Association, for its reasonable convenience, requires to enable it to serve other consumers. Dated: (witness) (owner) (name of Association) per (witness) chair (witness) secretary Form 5 Rural Utilities Act Member ’ s Lien Note I/We, of in the Province of Alberta, a member of the , promise to pay to the , within years from the day of , , being the day from which interest shall be computed, the sum of dollars (hereinafter called the principal) with interest at the prime interest rate established from time to time at its head office located at and published as such, plus % per annum, the principal to be repayable in instalments as follows: 1st instalment dollars on the day of 20 2nd instalment dollars on the day of 20 3rd instalment dollars on the day of 20 4th instalment dollars on the day of 20 5th instalment dollars on the day of 20 6th instalment dollars on the day of 20 7th instalment dollars on the day of 20 8th instalment dollars on the day of 20 9th instalment dollars on the day of 20 10th instalment dollars on the day of 20 together with accrued interest on the unpaid principal on each of the above dates. I shall pay instalments when due to at in the Province of Alberta. DESCRIPTION OF LAND: Dated at in the Province of Alberta, this The above was made and signed in my presence by the said ) this day of ,) (Signature of Member) ) ) (Joint Tenants, Both Sign) WITNESS ) ) (Name of Association) ) ) (Signature of Officer) Form 6 Rural Utilities Act Notice of Lien To the Registrar: Alberta Land Registration District TAKE NOTICE that the (hereinafter referred to as “the Association”) of in the Province of Alberta, under the Rural Utilities Act (hereinafter referred to as “the Act”) holds a lien note executed and made by and that, pursuant to the provisions of the Act, the Association has a lien on the interest of in the land described as follows: for the total indebtedness, including interest, owing in respect of that lien note. Dated: Director of Form 7 Rural Utilities Act Discharge of Lien Loan To the Registrar: Alberta Land Registration District Re: of TAKE NOTICE that of , Alberta has repaid in full the amounts owing on a lien note under the Rural Utilities Act , notice of which note was endorsed by memorandum on the title to the following land, namely: and therefore the memorandum is to be cancelled forthwith. Dated: Director of Lien Registered as No. Form 8 Rural Utilities Act Assignment of Lien To the Registrar: Alberta Land Registration District TAKE NOTICE that the of in the Province of Alberta has assigned its interest in the following member’s lien note described as: to His Majesty in right of Alberta, as represented by the President of Treasury Board and Minister of Finance, whose address for service is: Dated: Director of AR 151/2000 Sched. 1;27/2002;68/2008;31/2012; 62/2013;218/2022;201/2024 Schedule 2 The fees payable for services under the Act are the same fees as the fees that are payable under the Cooperatives Regulation (AR 55/2002) for similar services that are provided in respect of co‑operative associations. AR 151/2000 Sched. 2;109/2008 Schedule 3 Standard By‑laws Table of Contents 1 Interpretation 2 First general meeting 3 Annual meetings 4 Special general meetings 5 Notice of meetings 6 Quorum 7 Voting and order of business 8 Composition and election of board 9 Powers and duties of board 10 Meetings of board 11 Proceedings at board meetings 12 Vacating director’s office 13 Corporate seal 14 Execution of certain documents 15 Fiscal year 16 Auditor 17 Membership 18 Expulsion of members 19 Security Interpretation 1 In these By‑laws, “board” means the board of directors of the association. First general meeting 2 The first general meeting of the association must, within 2 months after the date of the incorporation of the association, be held on a day and at an hour and place decided by the provisional board. Annual meetings 3 (1) Annual meetings of the association must, within 120 days after the conclusion of each fiscal year of the association, be held on a day and at an hour and place decided by the board. (2) The primary purpose of the annual meeting of the association is to do the following: (a) to review and approve financial and other pertinent reports; (b) to appoint an auditor for the ensuing year; (c) to elect directors. Special general meetings 4 (1) A special general meeting of the association may be called at any time by the board when the board considers it necessary or advisable. (2) The board must call a special general meeting of the association when requested to do so by at least 25% of the members. (3) A request under subsection (2) must be in writing and state clearly the nature of the business to be transacted at the meeting. (4) Where the board receives a request in accordance with subsections (2) and (3), (a) if the board does not issue a call for the meeting within 14 days from the day of receiving the request, or (b) if the meeting called is not to be held within 60 days from the day of the board receiving the request, the members making the request, or any other 25% or more of the members, may call a meeting of the association. (5) Where a special general meeting has been called under subsection (2), a subsequent special general meeting may not be called within a 24‑month period following that special general meeting if the nature of the business to be transacted at the subsequent special general meeting is the same or similar in nature to the business that was transacted at the initial special general meeting. Notice of meetings 5 (1) The board or members calling a general meeting of the association must give at least 10 days’ notice of the meeting (a) by mailing to each member of the association, at the member’s address last registered in the office of the association, a notice stating the hour, day and place of the meeting, or (b) by advertising the hour, day and place of the meeting in a newspaper circulating throughout the association’s locality. (2) If the addition or repeal of or amendment to any provision of the By‑laws of the association or its memorandum of association is to be proposed at the meeting, the intent of the proposed change must be included in the notice of meeting. Quorum 6 (1) Subject to subsection (2), at a meeting of the association, not less than 10% of the members of the association constitutes a quorum. (2) If the association has a membership of more than 500 members, not fewer than 50 members constitute a quorum at a meeting of the association. (3) If at the time appointed for any general meeting of the association a quorum is not present, (a) in the case of a meeting called by members, the meeting is dissolved, and (b) in the case of a meeting called other than by members, the chair of the meeting may call for a resolution to the effect that those present at that time constitute a quorum and be empowered to transact the business to be brought before the meeting. (4) If the resolution referred to in subsection (3)(b) is passed by a majority vote of members present and recorded in the minutes, the meeting may then proceed and those members present constitute a quorum. Voting and order of business 7 (1) At a general meeting of the association, a majority vote of the members casting votes may decide all questions, except when an extraordinary resolution is required. (2) Subject to section 17(3) and (4), each member in good standing has one vote on any question. Composition and election of board 8 (1) The board is to consist of an odd number of directors, not being fewer than 5. (2) Notwithstanding subsection (1), if an association has fewer than 50 members, the board is to consist of an odd number of Directors, not being fewer than 3. (3) Any member in good standing or the representative of a corporation that is a member in good standing is eligible to be elected as a director. (4) Candidates for election to the office of director must be nominated openly at a general meeting of the association. (5) At the first general meeting of the association, (a) there is to be elected to hold office until the first annual meeting of the association (i) 1/3 of the total number of directors to be elected, or (ii) if 1/3 of the number referred to in subclause (i) is not a whole number, the next highest whole number; (b) there is to be elected to hold office until the 2nd annual meeting of the association (i) 1/2 of the remaining number of directors to be elected after applying clause (a), or (ii) if 1/2 of the remaining number referred to in subclause (i) is not a whole number, the next highest whole number of directors; (c) there is to be elected to hold office until the 3rd annual meeting of the association the remaining number of directors to be elected after applying clauses (a) and (b). (6) Subject to subsection (5), the term of office of a director is 3 years. (7) Retiring directors are eligible for re‑election. Powers and duties of board 9 (1) The board is to direct and supervise the business of the association, and may exercise all the powers of the association that are not required to be exercised by the membership in a general meeting. (2) The board may appoint an executive committee from among its number and prescribe the committee’s duties. Meetings of board 10 (1) Immediately after the first general meeting of the association and, subsequently, at the first meeting of the newly elected board after each annual meeting of the association, the board is to meet and elect from its own number (a) a chair or president, and (b) a vice‑chair or vice‑president, and any reference in these By‑laws to the chair or vice‑chair is to be read as also referring to a president or vice‑president respectively. (2) At each meeting at which a chair is elected, the board must appoint (a) a secretary and a treasurer, or (b) a secretary‑treasurer having the duties of both secretary and treasurer. (3) The secretary and the treasurer or, where there is a secretary‑treasurer, the secretary‑treasurer, may, but need not, be a director or a member. (4) The board must hold a meeting not less than once every 3 months as required by the Act and, subject to subsection (1), the board may hold other meetings on days and at places and times decided on by the board. (5) The chair must call a special meeting of the board on the written request of a majority of the directors or if the chair considers it to be necessary. (6) The secretary must give each director written notice of a special meeting, (a) stating the time and place at which it is to be held, and (b) stating, in general terms, the nature of the business to be transacted at the meeting. (7) A notice given under subsection (6) must be given to each director (a) by mailing the notice to the director’s address at least 5 days before the day on which the special meeting is to be held, or (b) by personally delivering the notice to the director, or in the director’s absence from the director’s residence, to any adult person there, not less than 24 hours prior to the meeting. (8) Notwithstanding this section, if all the directors are present at a director’s meeting, it is deemed to have been properly called whether or not the notice of the meeting has been given or properly given. Proceedings at board meetings 11 (1) A majority of the directors constitutes a quorum for the transaction of business at a meeting of the board. (2) The chair may vote on any question, but having done so, the chair does not have a casting vote in the event of a tie. (3) If there is not a majority in favour of a motion, the motion is lost. (4) At the meeting of the board held before the annual meeting of the association, the directors are to adopt a report covering all the activities of the association for the preceding year for presentation to the annual meeting. Vacating director ’ s office 12 (1) Where a director fails to attend 3 consecutive meetings of the board of which the director has been duly notified, the director’s office may be declared vacant by the board if the director’s absence has not been explained to the satisfaction of the board. (2) Where (a) a director, or (b) a corporation whose representative is a director, ceases to be a member of the association, the office of that director is to be declared vacant by the board. (3) Where a director’s office is vacated under this section, the board may forthwith fill the vacancy in accordance with the Act. Corporate seal 13 (1) The association is to have a corporate seal in a form approved by the board. (2) The seal is not to be affixed to any documents except those kinds of document that are authorized by resolution of the board as documents to which the seal is to be affixed. (3) The use of the seal must be authenticated by the signature of a director, the secretary or some other person authorized by the board. Execution of certain documents 14 The board may authorize by a motion of the board the persons who have signing authority for the cheques, notes, bills of exchange and other financial documents of the association. Fiscal year 15 The fiscal year of the association is the year beginning on January 1 and ending on the following December 31 unless otherwise provided for by supplemental by‑law. Auditor 16 (1) No person holding office in or employed by the association is eligible to be appointed as the auditor of or to perform any of the duties of the auditor of the association. (2) The auditor is to be appointed by resolution passed at an annual meeting of the association or at a special general meeting of the association called for that purpose. (3) Where (a) the reserve account of the association exceeds $100 000 and is administered by the association, or (b) the operating revenues of the association exceed $100 000, the auditor must be a member in good standing of an association of accountants recognized by the Director. Membership 17 (1) On the approval of the board, a person may become a member of the association if that person (a) owns or has an interest in land, (b) enters into a contract with the association for the provision of utility service to that land and for the payment of the required contribution to construction and extension of works costs, if any, and (c) pays the membership fee. (2) Subject to subsection (1), a person who is 16 years of age or older may become a member as provided for under the Act. (3) Subject to subsection (1), 2 or more persons who own or have an interest in land, jointly or in common, may jointly become a member, and in that case (a) the rights of a member to receive notices, to attend meetings of the association and to be a director is vested in only one of those persons, and (b) those persons must, in accordance with subsection (6), furnish the association with a designation of one of themselves as the person who is to have those rights of membership. (4) Subject to subsection (1), a corporation may be a member of the association. (5) Where a corporation becomes a member of the association, the corporation must, in accordance with subsection (6), furnish the association with a designation of a person who is to be the corporation’s representative with the right to attend meetings of the association, to vote and to be a director. (6) A designation under subsection (3) or (5) (a) must be in a form acceptable to the association, (b) must be furnished to the association at the time the utility service contract is executed, and (c) may be changed from time to time by a like designation. (7) A member withdrawing from the association is entitled to be repaid the member’s membership fee, but any contribution by the member toward construction and extension of works costs becomes and remains the sole property of the association. Expulsion of members 18 (1) The board may expel any member from the association for actions that in the board’s opinion are harmful to the association or for failing to patronize the business of the association to a minimal amount. (2) On expelling a member, the board shall return to that person the person’s membership fee. (3) Before ordering the expulsion, the board must invite the member to attend a board meeting at which the reasons for the expulsion are to be discussed and the member allowed to present the member’s arguments against expulsion. (4) The board must forthwith give written notice of an expulsion order to the member whose expulsion has been ordered. (5) A member whose expulsion has been ordered may, within 14 days from the day of receiving notice of the expulsion, give written notice to the board of the member’s intension to appeal the expulsion to the next general meeting of the association. (6) Where an expulsion is appealed to a general meeting of the association, the association may confirm the expulsion or order the reinstatement of the former member. Security 19 (1) This section applies only to an association that owns works. (2) The association shall at all times maintain theft insurance or fidelity insurance against loss or damage caused by officers, employees and directors who carry out the functions of employees. (3) The association shall at all times maintain general liability insurance in an amount not less than $2 000 000 inclusive per occurrence insuring against bodily injury, personal injury and property damage, including loss of use of property. (4) In this section, “theft insurance”, “fidelity insurance” and “general liability insurance” have the meaning given to them by the Classes of Insurance Regulation (AR 121/2001). AR 151/2000 Sched. 3;109/2008;26/2010;201/2024