ABC drops school board candidate over charitable foundation's troubles with CRA

A Better City, the Vancouver party led by mayoral candidate Ken Sim, has dropped one of its candidates for school board after learning that a foundation he is a director of recently had its charitable status revoked by the Canada Revenue Agency.

Christopher Richardson, a former school board trustee and park board commissioner, serves as a director of Headwaters Foundation, which was a registered charity until the CRA’s action earlier this month.

CTV News was unable to find a website or social media accounts for the Headwaters Foundation and it is not clear what type of charitable work the organization was involved in.

In a statement released on Sunday, ABC said it learned of the CRA’s decision to revoke the foundation’s charitable status on Friday and over the weekend told the city’s chief election officer that ABC no longer endorses Richardson.

“Should Mr. Richardson be elected, he would not be able to join the ABC caucus until the matter is resolved to satisfaction,” ABC said in the statement.

CTV News political analyst George Affleck said he was not surprised by the party’s action in light of the circumstances.

“The decision was probably very quick and it’s generally a good approach to do that in politics if there’s going to be something that takes the headlines away from the headlines you like,” Affleck said.

In a letter to the Headwaters Foundation explaining the decision, the CRA said “it was found that the Foundation failed to devote resources to a charitable purpose, failed to meet its disbursement quota, and failed to file an information return as and when required.”

In separate correspondence outlining its audit of the foundation’s finances, the CRA detailed what it called "unusual" transactions involving Headwaters, Charitable Impact Foundation and Paraklesis Foundation.

The CRA said some of those transactions involved 1,250,000 shares of a public company listed on the Toronto Stock Exchange.

In the documents viewed by CTV News, the name of the company is redacted.

“It is our position that the Foundation was operated for the non-charitable purpose of facilitating a private tax planning arrangement, similar to the situation in Prescient Foundation v MNR where the Court held that ‘these transactions amounted to participating in a tax planning arrangement for the private benefit of others and, as such, were not entered into for charitable purposes,’” the CRA said.

“We make the same conclusion in the case of the foundation. The Foundation structured its affairs for the benefit of private persons to the detriment of the Foundation’s charitable mandate.”

On Monday afternoon, Richardson still had an ABC election sign with his name on it in his front yard alongside a large "Ken Sim for Mayor" sign.

Reached by telephone, he declined a CTV News interview request and said he would provide a brief statement instead.

“As a Chartered Professional Accountant and charitable gift planner, I understand charity sector rules and governance matters which is why I've been sought after to give back to many different charities as a volunteer, employee, and board member,” Richardson said in the statement. “As a board member of Headwaters Foundation, I cannot comment publicly on matters the Foundation is actively appealing to the Canada Revenue Agency, Charities Directorate (CRA).”

Voters will still see ABC next to Richardson’s name on ballots because those have already been printed.

“That’s the name that was put in and so the candidate will have his name with ABC beside it,” said Affleck.