Belleville opens $140k tourism grant program to for-profit businesses using workaround for rules that prevent ‘bonusing’

In November 2025, Belleville Council closed the Grant Committee and reassigned the responsibility of reviewing grant applications to an internal, unelected Staff Review Committee, which provides recommendations before Council makes a final decision during a Regular Council meeting.

The Tourism stream of the Grant Program awards grants to entities involved in arts and culture, heritage, agri-culinary initiatives, sports, recreation, meetings and conventions, festivals and related sectors. The City allocated $140,000 to it in 2026.

On March 23, 2026, Belleville updated the Grant Policy to allow for-profit businesses and individuals to compete with non-profits for the tourism grant funding – up to $10,000 each – during the second application intake of 2026. Previously, eligibility was restricted to non-profit or charitable organizations, which are now categorized as “Stream 1”, and for-profit applications are “Stream 2”.

To “get around provincial ‘bonusing’ restrictions”, Belleville Council has handed final approval of the for-profit applications to a third-party – the arms-length Bay of Quinte Regional Marketing Board (BOQRMB), but according to the Director of Finance, BOQRMB is contractually obligated to follow the recommendations of the Staff Review Committee based on an Amending Agreement that hasn’t been made available to the public.

$70,000 of taxpayer funds are now free to be awarded to for-profit tourism businesses by an internal, unelected Staff Review Committee without the approval of elected representatives and scrutiny of the public that is applied to all other grant program funding.

This policy further reduces the transparency and accountability of Belleville’s grant program and risks contravening the Municipal Act.

For-profits will compete with non-profits for $70,000 in tourism funds in 2026

The total approved budget for the 2026 Tourism Grant funding stream is $140,000. The first intake period closed on January 31, 2026 and approximately 50% of these funds will be allocated upon Council approval in April. The remaining 50% will be held for the second intake period which is currently open until April 30, 2026. The Tourism Grant program is funded by the Municipal Accommodation Tax (MAT).

It will be broken up into 2 streams:

• Steam 1 (non-profit organizations awarded by City of Belleville) would reflect what is in the current policy and remain applicable to non-for-profit organization (both funding and in-kind). Application review and approvals will continue to be the responsibility of the grant committee and authorized through Council approval.
• Stream 2 (individuals and for-profit companies awarded by Bay of Quinte Regional Marketing Board) would follow the same policy with the exception of allowing for the broader group of applicants and not awarding in-kind support. That will allow individuals and for-profit businesses to be eligible to apply that are involved in arts and culture, heritage, agri-culinary initiatives, sports, recreation, meetings and conventions, festivals and related sectors.

Funding was not allocated between the two streams, so non-profit organizations will compete with for-profit companies for the funding.

These changes will create immediate opportunities for all eligible applicants to seek funding during the second intake and will provide program staff with additional time to develop a long-term, strategic funding approach for product development. Staff recommend that further analysis be undertaken as part of the City’s Destination Development Plan, scheduled for completion between Q2 and Q4 2026, with longer-term funding distribution recommendations brought forward prior to the 2027 grant program intakes.

Staff recommended the changes following consultation with the City’s solicitor, and in consideration of both short-term risks and long-term strategic objectives. Staff investigated Tourism Community Improvement Plan or Destination Development Fund as alternatives to the Tourism Grant Program.

Municipalities allowed to give grants, but are not allowed to give direct or indirect financial assistance to commercial enterprises

Despite any provision of this or any other Act relating to the giving of grants or aid by a municipality, subject to section 106, a municipality may make grants, on such terms as to security and otherwise as the council considers appropriate, to any person, group or body, including a fund, within or outside the boundaries of the municipality for any purpose that council considers to be in the interests of the municipality.

Section 107 of the Municipal Act

Section 106 of the Municipal Act states that municipalities are generally prohibited from “bonusing,” which is the practice of giving direct or indirect financial assistance to a commercial enterprise:

Despite any Act, a municipality shall not assist directly or indirectly any manufacturing business or other industrial or commercial enterprise through the granting of bonuses for that purpose.  2001, c. 25, s. 106 (1).

Same

(2) Without limiting subsection (1), the municipality shall not grant assistance by,

(a)  giving or lending any property of the municipality, including money;

(b)  guaranteeing borrowing;

(c)  leasing or selling any property of the municipality at below fair market value; or

(d)  giving a total or partial exemption from any levy, charge or fee.  2001, c. 25, s. 106 (2).

Section 106 of the Municipal Act

Historically, municipalities would engage in “bidding wars,” offering tax breaks or free land to attract businesses. This created a “race to the bottom” where municipalities competed against each other at the expense of their own tax bases, often without ensuring a clear, long-term economic return for the community. Incentives frequently failed to produce lasting results and led to significant financial losses for local taxpayers when companies failed or moved on.

In 1974, the provincial government made bonusing illegal saying the practice wasn’t fair and to ensure all municipalities would compete on a level playing field.

Stream 2 application process

Stream 2 appears to be designed to navigate the legal constraints by delegating final authority for Stream 2 applications to BOQRMB instead of Council.

Applications recommended by the grant committee under Stream 2 of the Tourism Grant Program will not proceed to Council for final approval as is as done for all other grant applications. Instead, Council will refer Stream 2 applicants to the BQRMB who has delegated authority to allocate funds for Stream 2 of the City’s Tourism Grant Program.

Belleville isn’t giving the money directly to businesses. They are giving it to the Bay of Quinte Regional Marketing Board (BOQRMB), which then distributes it.

As a non-profit corporation, Destination Marketing and Management Organization (DMMO) and the “Eligible Tourism Entity” for the region required to support “tourism promotion and product development”, BOQRMB is not subject to the same “anti-bonusing” restrictions. BOQRMB can fund private-sector tourism initiatives that the City legally could not fund directly.

Belleville added a representative from the Bay of Quinte Regional Marketing Board (BOQRMB) to the City’s internal Staff Review Committee to help review those applications and provide funding recommendations.

Director of Finance says BOQRMB’s final decision won’t change from committee’s recommendation or it would breach their agreement with the City

Councillor Brown asked the Director of Finance the following questions about the new policy:

What precautions have been included to prevent nonprofits from being forced out by for-profits?

So, for instance, if we have a ribfest that’s run here by a nonprofit group, there’s also a number of for-profit ribfests that run throughout the province of Ontario. If that for-profit business came in and requested a a tourism stream to grant, what precaution do we have that that big event won’t force out or or disenfranchise the NPO that may run a smaller event?

Councillor Kathryn Brown

We have established some background and requirements for Bay of Quinte Regional Marketing Board. So when staff is going through the evaluation, the evaluation will be done at the committee level as it is usually done with recommendations brought to the grant committee. We’ll be reviewing through the initial Stream 1 first to make sure we understand the allocations and the breakdown that’ll be recommended with the residual Stream 2. Looking for the same criteria that’s established and that’s in place for the policy with the limitations that are identified. So working through those recommendations in step should provide some parameters to ensure that they’re not disadvantaged.

Director of Finance Brandon Ferguson

What’s preventing the Bay of Quinte Regional Marketing Board from changing the final decision after the recommendation from the Staff Review Committee?

I appreciate we’re trying to work around the legislation that prevents bonusing. So we are making the decisions – I’m sorry, we are looking at making recommendations from the grant committee and then handing that over to the Bay of Quinte Regional Marketing Board for the final decision and the disbursement of funds.

What prevents the Bay of Quinte – and no disrespect for my colleagues over at the Regional Marketing Board. I’ve worked very closely with them. I think they’re doing great work.

But what prevents their board from changing the recommendations from grant committees here? It’s not unforeseeable that we have a staff recommendation that comes to us. And as council, sometimes we accept it, sometimes we change it, and sometimes we defeat it in its entirety.

What’s preventing the Bay of Quinte Regional Marketing Board from taking that same kind of action on the tourism stream?

Councillor Kathryn Brown

Some of those updates through the bylaw agreement with Bay of Quinte Regional Marketing Board are implementing those exact things. The recommendations are coming from us and the agreement will predicate and require them to do that. It would be a breach of the agreement if they chose to do so.

Director of Finance Brandon Ferguson

The referenced Amending Agreement, authorized by By-law Number 2026-023, to the Financial Accounting and Services Agreement between the City of Belleville and The Bay of Quinte Regional Marketing Board has not been made available to the public, unlike the Services Agreement and the Memorandum of Understanding (MOU) between Belleville and the Board.

Will that Amending Agreement be coming to council for debate and approval before it is signed off with the Bay of Quinte Regional Marketing Board?

The Amending agreement that was covered under 2026-023. Will that Amending Agreement be coming to council for debate and approval before it is signed off with the Bay of Quinte Regional Marketing Board?

Councillor Kathryn Brown

Yes, we could bring that back through the bylaw. The bylaw went through the previous council meeting, but that could be made available and brought back to council.

Director of Finance Brandon Ferguson

New agreement may have been approved in closed meeting

It appears as though the Amending Agreement By-law Number 2026-023 “went through” the Feb 23, 2026 council meeting during an in-camera closed session.

This is based on the numbering of the by-laws during previous meetings:

• 2026-020 to 022 – Feb 23, 2026
• 2026-024 – Mar 09, 2026

Feb 23 being the only one of the two with an in-camera meeting:

In Camera (Closed Session) Report No. ECDEV-2026-04 regarding advice that is subject to solicitor-client privilege (Pursuant to Section 239(2)(f) of the Municipal Act)

and the staff report referencing recommending the changes following consultation with the City’s solicitor.