City of Charlottetown 'going through a process' regarding future of CAO Peter Kelly, says mayor

Charlottetown Mayor Philip Brown says the city is "going through a process" regarding the future of chief administrative officer Peter Kelly, under fire this week over allegations he fired two senior employees after they came forward with concerns about the city's administration.

Sources have told CBC News there are discussions underway around a six-figure severance package for Kelly, but neither the mayor nor anyone else was prepared to give details. 

"That is to… remain with council until we make an announcement," Brown told CBC in an interview on Thursday evening.

The sources who spoke to CBC News about the negotiations asked not to be named. 

On Monday, Charlottetown council members met for two hours behind closed doors, where it's believed the matter was discussed.

Kelly was hired by the city in 2016. His position as CAO was made permanent a year later, even as a review was underway in Alberta regarding allegations Kelly had exceeded his authority while CAO of Westlock County.

That review concluded Kelly had acted in contravention of that province's Municipal Government Act by authorizing hundreds of thousands in spending without a resolution of council.

At the time, Kelly called the review "a selective witch hunt."

As mayor of Halifax in 2011 Kelly became embroiled in a scandal over hundreds of thousands of dollars provided to a concert promoter without council's knowledge. 

In Charlottetown, former deputy CAO Scott Messervey wrote to councillors after he was fired by Kelly in 2019 saying he believed he was fired in retaliation for raising concerns about financial administration, adherence to city bylaws and breaches of P.E.I.'s Municipal Government Act.

Kelly told Messervey in his dismissal letter that he was being fired over concerns about his interactions with other staff and members of council, some of whom felt Messervey was "looking for errors," rather than working with them to meet the city's goals.

This week P.E.I.s Minister of Communities Jamie Fox said a third-party review at the time found there had been no breaches of the act, but no report resulting from that review has ever been made public.

Messervey's replacement Tina Lococo, hired in Oct. 2021, recently wrote to members of council saying she too was fired after raising concerns about city hall.

If you have information about this story, or a news tip to share with CBC Prince Edward Island, please email kerry.campbell@cbc.ca or compass@cbc.ca.