I am not sure what my colleague is trying to say. Let us say the community of Fort McPherson wishes to borrow money from the government or in a repayable contribution. It has to show the capacity to pay it back. If it defaults by not paying it back, I am not sure what the answer is to that one, quite frankly, if I can be very blunt about it. I would have to confer with my honourable colleague, Mr. Lew Voytilla, for a moment.

Sorry, Madam Chair. It is not that I am trying to avoid it. It is just so simple, sometimes you cannot see it. In the request for borrowing, they have to show, first of all, capacity to repay. So you make the assumption, like a bank, that they have the capability. If we are in a situation where there is the isolated case where they are unable to repay, we will work with that municipality to work out a repayment schedule that they can afford. There have to be circumstances to that effect. But when you approve a loan, you approve a loan based on certain principles, certain capacities, certain criteria, so yes, if, what has been suggested by Mr. Voytilla, if there were isolated cases, then we would work with the constituency. One could be to refinance it, two could be look at a schedule of payments, et cetera. So, yes, there is a caring capacity within this policy to ensure that we look after the communities as best we can.

That is not a precedent. This is a situation where, the monies were taken out of the capital budget. It took some time to negotiate with the constituency that they had to repay it. They should be complimented for taking that initiative to do that. That is the only reason it is in here and it is certainly the precedent where there is a repayment schedule and that is the process that will be under way in the coming months with whatever communities ask for borrowing to work within their land development proposals. Absolutely.

Thank you, Madam Chair. Madam Chair, my question concerns in generalization under $1.5 million that was being loaned to Rankin under this new policy that we have passed by this government under the land development. What is going to happen if the demand over the next x number of months from different communities increase, so we have to end up with $10, $12, $15, $20 million to borrow or lend to these communities? Rankin Inlet being an non-taxed base municipality and not necessarily one of the largest in the Northwest Territories and this $1.5 million. What about these other communities? I am saying, would that cause a demand or a problem for the cash flow of this government if we lend out $20 or $30 million and will not be getting it back over five or 10 years? What would happen then, at the end of the day, division on April 1, 1999? Does the money that has to be paid back by the Hamlet of Rankin go to one or the other jurisdictions? Have those types of things been looked at? Thank you, Madam Chair.

A good question in relationship to how do you control the amount of lending that is out there. Mr. Voytilla advises me, reminded me, every year we come in with a Loan Authorization Act with a certain amount of money allocated to it, so there is an element of control there. That has to come forward every year on an annual basis. On the issue of who pays what in 1999, I would see that as part of the asset and

liability. Whatever arrangement we make, there is a million amount there, this will just be one tiny, small part to the overall divvying up of assets and liabilities, et cetera. Thank you.

Thank you, Madam Chair. Madam Chair, Mr. Voytilla, in conversation with Mr. Todd, gave him the indication that there indeed was an amount that comes forward under the loan authorization. As we all know, in this House, over the past 15 months, those monies are targeted for different areas, not necessarily the land development money, as such. My supplementary question to Mr. Todd as the Finance Minister, under this area of community operations is, do they have a targeted amount set for land development? If not, are they going to be setting up one? As this new policy now has only taken place in the last month, we already have seen a request for $1.5 million from one community and it was only approved in the last session, in March. We have another twelve months to go. What type of budget have you got there and what happens to a community if all the money is gone, if the community of Tuktoyaktuk wants to develop land and there is no money left to be borrowed because we are already at our limit? How are we going to do this? I think there are some very good questions. Thank you, Madam Chairperson.

I always assume all questions of Mr. Picco are very good. Madam Chair. I think Mr. Picco is correct, the policy is relatively new and the legislation was changed. What is going to be the uptake, I think is the question, and do we have the capability if the uptake is greater than our fiscal needs, right? My understanding is that MACA will be going out and is going out on an annual basis, as they normally do asking municipalities. They do it under municipalities who can issue debentures and taxes. You know, what are your fiscal borrowing requirements? It is merely an expansion of that, in a sense.

Now I would not deny that there are some growing pains to this policy. There is no question about that. Anybody to suggest otherwise is just silly and naive. The reality is, MACA does have a process in place. It goes out and seeks from the constituencies at large what their requirements are for capital money, what the requirements are going to be for infrastructure money and they will also ask what its requirements are, and if it requires borrowing under the new policy. We will collate that and determine what the appropriate levels are that are going to be required. That would probably come in under the Loan Authorization Act. So there is a system in place, but it does have some growing pains, no question. Thank you.

Thank you, Madam Chair. I would have thought my colleague here would have applauded Rankin Inlet for their initiative in paying it back, since all we ever hear from these municipalities that have got a tax base is that we are not pulling our weight. This new policy, brought forward by my colleague, Hon. Manitok Thompson, does in fact do that. It puts the responsibility and the onus at the community level to pay back and find ways to pay back the land use development. That is what this is all about. Nothing else, nothing more. I wonder if this was Gjoa Haven would this be taking place? That is all this is, nothing else. It is no different and is consistent with how we treat Yellowknife, Fort Smith, Hay River, et cetera. Nothing else, nothing more. There is going to be more of it, he is absolutely correct, because that is the policy in the legislation that we approved the last time around. I do not know how else to answer it.