The information could be prepared. It isn't readily available here, though.

Thank you, Mr. Chairman. In reviewing some of the documentation that has been provided by the Minister and his department, it seems the decrease of the commercial subsidy is obviously going to affect commercial enterprises. In one statement, they cite examples of commercial users and how they will be affected. They say that the Northern Store in Aklavik will go be going from $31 to $39 and there are a couple of other examples of Northern Stores in the communities. Although I recognize that the Northern Stores are commercial users, they are very minimal users, I would take it, of water consumption in the communities because they are retail operations.

I would like to ask if they've looked at some of the larger operations, such as hotel operators and restaurant operators, those which are higher consumers of water services in the communities, and what effect the decrease in the commercial subsidy will have on their businesses? Thank you.

Thank you, Mr. Chairman. Yes, there has been an analysis done, per community, of the impact this may have on commercial users in hamlets. Thank you, Mr. Chairman.

I would like to ask if that information would be available to committee Members? Thank you.

Mr. Chairman, that would not be a difficulty. We have copies here that could be distributed to Members.

Thank you, Mr. Chairman. When they implement this rate change, it will require some adjustment to the reporting requirements of the municipalities to the department. I was just

wondering if they could update the committee Members on what exactly this will mean for the reporting relationship of the municipalities? Thank you.

Thank you, Mr. Chairman. I don't know that. I would have to ask Mr. Christensen to respond.

Mr. Chairman, the reporting relationship would not change in the case of the hamlets and non-tax-based communities, but the relationship would change somewhat for the towns and villages. Part of the implementation of this policy would involve community service agreements, agreements set out between the department and the municipalities regarding rules on what are eligible costs to charge against the economic rate for the water and sewer service. It is against the economic rate that the subsidy is applied. The department would work with municipalities through that agreement so that both parties have a good and common understanding of what rules apply.

Thank you, Mr. Chairman. Just to clarify then, there won't be any changes required for non-tax-based municipalities software and the reporting of the municipal usage? It is something that is easy to do?

Mr. Chairman, our belief is that the software that is in place is readily usable to implement this change. However, if there are some modifications required to the local software that is used, the cost can be incorporated into the economic rate calculation for water/sewage services. This wouldn't be a cost directly bearable on the municipality.

Mahsi, Mr. Chairman. From the town of Inuvik's perspective, there was a brief analysis that was done about this new policy. The majority of the residents are going to be greatly impacted in Inuvik. I mentioned some numbers earlier in a Member's statement where the increase on residents would go up from $55 to $123.73 per month. In cases of commercial users, the rates will either double or maybe triple, if some of the assumptions which are used in calculating rates are correct.

Given that, and if those assumptions are correct, I have a lot of problems with this policy and so do the people I speak on behalf of. Any increases in the cost of doing business or the cost of living in these times of restraint and poor economic

situations is an impact on the pocket book of the user and is a cost that some people may not be able to afford.

The question that Dennis raises to the cost-benefit to the government is one that is quite a concern. If the number the Minister said, $200,000, is what the cost-savings to this government is to implement this thing, I can assure you that most of that is going to come from Inuvik users just based on the numbers that I have. Again, I haven't worked it out by resident or by business, but that can be done quite quickly.

The point I am making is there are going to be impacts on residents. There will be impacts on businesses and the large users such as the hotels and the restaurants. The Minister, in the documentation we received, said that the subsidy is to be based on fairness and equity. Fairness in terms of users, that all residents are entitled to basic water and sewage services. Basic water and sewage should be provided on an equitable and affordable basis. So this whole issue of equity and affordability has to be defined. Equitable has to be defined in terms of the delivery of services across the north. From what I am hearing, my understanding is because of situations in certain communities, we are now broad brushing everyone across the north.

There is another issue of usage versus conservation. The whole issue of conservation I think we all believe in and every individual should. The north has 20 per cent of the world's supply of fresh water. So I don't think the issue of availability of water is an issue in any of the communities that I am aware of.

In Inuvik there is the Inuvik Utilidor Planning Committee that has been ongoing for several years. The deputy minister has indicated that he has had correspondence and discussions with this committee. They are looking at the utilidor system that is in Inuvik. The utilidor system is based on the water running through the system for heat for buildings, to keep the sewage pipes from freezing and also supplying water to buildings. So the majority of the residents in Inuvik have some form of piped water. They didn't always, but they do now.

The calculation for economic rate is based on the total cost of delivering the water, plus the cost of trucked water which is very minimal in Inuvik. I assume there is some reserve there for capital growth. That is divided by the number of litres of water utilized. That gives you an economic rate per litre. In Inuvik, if no one used water, you are still going to have to maintain the system.

The other assumption being used for Inuvik is to try to get the residents of Inuvik on meters, with the assumption that once they are on meters, then there will be a higher tendency to conserve. The notes I have are they are looking at up to 50 per cent of reduction and consumption of water. If that is the case, you would be delivering 50 per cent less water, but you still have the full system to maintain. So the cost of maintaining the system is not going to change. If that is the case, your economic rate then doubles based on an assumption that there is 50 per cent less consumption. That extra 50 per cent is going to be passed onto the users. The calculation I have is that for some of the commercial users, hotels, for instance, their rates are going to increase by 118 per cent.

So the flaw in the concept is if there is decreased usage, that the costs are going to be the same. But the commercial users are going to pay considerably more then. Commercial users, to my understanding, are already on meters in Inuvik.

The other problem I mentioned is the cost of maintaining or running the utilidor system which is based on water. You need to keep the system moving, so there are some electricity costs and you have to bleed the pipes and machinery that is used to keep water running.

The area of conservation comes to the use of meters. It is an issue that has been discussed with the town and department. But if meters are installed, the assumption is that water will be conserved. The argument that has been used is the cost of installing meters, which may be $400,000 plus. I am not sure what the capital costs were before, but let's use a hypothetical number of $400,000. My understanding is the savings are about $13,000 to $30,000 per year. So it doesn't make economical sense to do this.

I just wanted to raise some of these concerns. I'm sure that the points that Mr. Zoe and other Members have brought up, that there has to be more consultation, that we have to be more certain, or should be more certain, as to what are the impacts on the residential users, especially on the business users, given the economic situations in the north. Those are some general comments, Mr. Chairman, that I wanted to raise. I'm not sure if the Minister wants to respond.

Thank you, Mr. Chairman. I know that Inuvik is a special situation. It is being dealt with in a different way from the way that this policy is being handled at this point. But for any details with regard to the way it effects Inuvik, I would, again, have to ask Mr. Christensen to respond.