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UPDATE: Peter Kelly staying as CAO of Charlottetown

City of Charlottetown CAO Peter Kelly at City Hall.
City of Charlottetown CAO Peter Kelly at City Hall.

Charlottetown CAO Peter Kelly isn’t going anywhere.

Mayor Clifford Lee announced Friday city council met with an outside legal advisor and decided Kelly will continue in his role as chief administrative officer.

Lee held a news conference Friday at city hall where he said council will continue to do performance evaluations on Kelly and move forward.

“As far as I’m concerned this is the end of the Peter Kelly saga,” he said.

The city hired Kelly in May 2016, at which time he was put on probation for six months.

That probationary period was extended in November for another six months.

On May 24, Kelly’s employment status was changed to permanent, with a condition council would review it if he is ever convicted of being in violation of any law.

Council’s latest decision came after a municipal inspection report for Westlock County in Alberta was released last month.

That report found Kelly acted without council approval on a land deal while he worked there as CAO.

Among the report’s findings, it also said Kelly appeared to not to exercise “reasonable oversight of capital project costs.”

In response to the report, Kelly said it was lacking, disappointing and incomplete.

Lee’s statement said the majority of council didn’t want to expose taxpayers to a potential lawsuit that legal advice suggest wouldn’t be successful in defending.

Charlottetown Mayor Clifford Lee speaks to reporters in council chambers Friday at city hall.

When he spoke to the media, Lee said council met twice along with outside legal counsel since the report’s release.

“At the end of the day the advice that council received is that the report really doesn’t contain anything that would justify a dismissal or disciplinary action against Mr. Kelly and a majority of council has accepted that opinion,” he said.

Coun. Jason Coady and Coun. Bob Doiron were the dissenting votes.

Coun. Mitch Tweel did not vote because he didn’t attend the meeting.

Coady said in a statement issued Friday evening that the hiring process “lacked transparency and due diligence from the very beginning.”

“An unnecessary risk was taken, and the resulting distractions have not been in the best interests of our city,” said Coady. “All of this could have been avoided.”

RELATED: Coady opposes Charlottetown's decision on Peter Kelly

Lee said there was no basis in the 115-page report to fire Kelly and he added that report was also critical of Westlock County’s council

“It would have been extremely difficult to work in that environment,” he said.

Coady said, “While the mayor has now suggested that legal expenses are somehow a justification for this decision, questions remain unanswered. Who approved these terms of employment? What are those terms?  How did those terms impact the legal position of our city? Why couldn’t legal expenses be minimized through reasonable notice or negotiation? At the end of the day, the fact of the matter is that any legal expenses were entirely preventable. I am unable to support this decision.”

When asked if he had any concerns about anything he read in the report about Kelly, Lee said the whole “public saga” wasn’t something he ever wanted to go through.

“It’s not something that city council ever wanted to have to deal with, but it is something that happened,” Lee said.

Lee said an outside human resource firm did a reference check on Kelly before the city hired him and the report from Westlock County council was “glowing.”

He also said council wasn’t looking to fire Kelly when it reviewed the situation with outside legal counsel.

“Council was looking to review the document, see what the document actually said.”

Lee told reporters he hadn’t talked to Kelly about the contents of the report.

“This was a decision that council had to come to grips with, not Mr. Kelly,” he said.

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