A city councillor who supported putting $100 million in public money into a new an economic diversification fund is not happy with one of its recent choices for investing some of its capital.

The Opportunity Calgary Investment Fund (OCIF) was set up by council in 2017 with a hefty $100-million bank account that it would use to encourage companies to invest in Calgary, diversify the economy and create jobs.

In December, the fund announced it would invest $100,000 of that capital in InterGen Canada, a new Calgary non-profit.

The company's founder is businessman Jim Gray.

The decision to invest in InterGen came a handful of months after Gray left the board of OCIF.

No one is alleging that any rules were broken, but Coun. Druh Farrell has concerns about how this investment looks given Gray's former involvement with OCIF.

"I think we need to review how these funds are awarded," Farrell said. "Whether or not there was a conflict, the optics were poor."

CEO alone can invest money

In this case, the decision to invest was ultimately made by Mary Moran, the CEO of OCIF.

She told CBC News that she has the authority to invest up to $150,000 of the fund's money, provided the applicant meets the criteria set out by OCIF.

Mary Moran is the CEO of the Opportunity Calgary Investment Fund and decides where the fund can invest. (Scott Dippel/CBC)

OCIF's board, which includes Mayor Naheed Nenshi and Coun. Jeff Davison, was also informed about her decision to give money to InterGen.

"I think we have very, very strong governance," Moran said.

"If there's any remote conflict of interest, we absolutely recuse people."

She also pointed out Gray wasn't involved in InterGen's application, so he never dealt with the board members he used to serve with.

Moran said their legal staff is consulted on funding decisions.

"There are many files, almost every single file, has some kind of conflict with some association with our organization, either CED [Calgary Economic Development] board or OCIF board because it's a small community, right? So everybody knows everybody."

OCIF requires other investors

Moran said OCIF's decision to fund InterGen came after other investors put in their money.

Western Economic Diversification Canada announced September 2019 that it was investing $600,000 in the company.

Just prior to OCIF's funding announcement in December, the Calgary Chamber of Commerce chose to invest $1 million in InterGen.

In an interview, Jim Gray told CBC News that he left OCIF's board in the spring of 2019 and InterGen's application went in after that time.

Gray, who is listed on InterGen's website as a founder and board member, said another company official handled the application to OCIF.

"If somebody's questioning whether I had some kind of inside information or some kind of leverage, it's a mystery to me what it could possibly be," Gray said.

The long-time Calgary businessman appeared before city council in 2017, advocating for the creation of OCIF as a way to create jobs, diversify the economy and add to the city's tax base.

Company will help others create jobs

Moran said InterGen met their criteria for investment because it will tap into the brainpower, experience and connections of retired or transitioning workers to help new startups grow.

The company plans to create eight new jobs and aims to have 140 companies registered in its program over three years.

"They're helping the ecosystem, to help companies create jobs. So it's not a measurement of them on how many jobs they create. It's a measurement of them of how many companies they help create jobs," Moran said.

For her part, Farrell is skeptical.

"It certainly didn't fit with the goal that I had of setting up OCIF," Farrell said.

"I was looking for more innovators. People who could certainly bring in jobs. People who wanted to try something new and needed a little extra assistance and I'm not sure that this fulfills that objective."

The city auditor is currently doing an operational audit of OCIF's system for making grants to applicants.

That report is expected to go to city council before the end of June.

Since OCIF was created, it has awarded more than $23 million to nine recipients.