Thank you, Mr. Chairman. The mandate of the Department of Municipal and Community Affairs, MACA, is to provide community governments with the support to deliver public programs and services essential to good community life, to assist with the development and maintenance of community governments, and to provide the resources necessary to achieve community goals.

The Standing Committee on Governance and Economic Development met with the Minister of Municipal and Community Affairs and his staff on Friday, January 17, 2003 to review the Department's Draft Main Estimates for 2003-2004.

Committee Members noted a net upward adjustment of $11.001 million in the department's operations expense from its 2003-2006 business plan. This net increase is due to: $1.266 million increase in overall changes to the department's amortization adjustments; $1 million increase for community programs to address community priorities such as youth and family, with a focus on active living; and $8.735 million increase in other adjustments resulting from the reporting of infrastructure contributions as an operations expense instead of a capital expenditure in accordance with the government's tangible capital assets accounting protocol.

The committee also noted a net downward adjustment of $6.845 million in the department's capital expenditures from its 2003-2006 business plans. This is the result of: an additional $1.39 million increase in funding for new investments comprised of $1 million for main street paving, $40,000 for solid waste site replacement in Deline, $50,000 for solid waste site replacement in Rae-Edzo and $300,000 for the land development fund; $500,000 moved forward from 2004-2005 for the replacement of the above ground pool in Fort Providence; however, $8.735 million was transferred to operations expense as part of the main estimates reporting protocol as required by the government's tangible capital assets accounting requirement.

Main Street Paving For Non-Taxed-Based Communities

In March 2002, during the review of the 2002-2003 main estimates for MACA, the Committee of the Whole passed a motion that required the Ministers of MACA and Transportation develop a program to pave the main streets within non-tax-based municipalities having a population greater than 500 residents and located on the Northwest Territories highway system.

Based on the above criteria, the department advised the committee in separate correspondence that the following communities would be eligible for the paving of their main streets: Fort Resolution, Fort Liard, Fort Providence, Fort McPherson and Rae-Edzo. Paving would be the chipseal type.

During the review of the department's draft 2003-2004 main estimates, the department provided the committee members with a preliminary implementation schedule for the main street paving program for non-taxed-based communities. However, committee members noted with concern that Tuktoyaktuk, an ineligible community, is proposed to receive $1.250 million for the chipsealing of its main street over the next five fiscal years. Although Tuktoyaktuk has a population of 979, it is not on the NWT highway system. The department remarked that the listing may change depending on community priorities and the Department of Transportation locations.

The committee brought this issue to the attention of AOC for further input from all Regular Members. After careful consideration, the members of AOC advised the government in a letter that funding for main street paving for non-tax-based communities must be scheduled specifically for those communities that clearly qualify.

The government recently replied that the main street in Tuktoyaktuk will be paved, regardless. FMB has extended the program to include all non-tax-based communities and directed that communities be scheduled in such a way as to maximize efficiencies between the paving program and other projects. As transportation's crushing and other equipment will be available in Tuktoyaktuk in the summer of 2003, the government added that it would be most cost effective to undertake the main street paving project in Tuktoyaktuk at that time.

Highway Emergency Rescue Vehicle

In many communities, the local fire department provides emergency services to the municipality, vicinity and the nearby highway. Unfortunately, in most cases, a response to a highway accident may leave a community with no emergency services. A highway emergency rescue vehicle would significantly contribute to a greater level of safety and services for communities on the highway system.

The Minister agreed with the committee, but replied that funding would be difficult to obtain under the current corporate capital planning process and the federal joint emergency preparedness program. As a result, the committee members made the following recommendation: The Standing Committee on Governance and Economic Development recommends the Department of Municipal and Community Affairs and the Department of Transportation reconsider their approach to the delivery of emergency services on the highway system, and place a higher priority on the emergency rescue responses that are accompanied with sufficient resources including highway emergency rescue vehicles.

Follow-up: Recognition of Firefighters

Firefighters and volunteer firefighters perform an important and indispensable community service and should be appropriately recognized. Special license plates similar to those issued to Members of the Legislative Assembly should be reconsidered for volunteer, full and part-time firefighters.

The Minister responded it is within the Department of Transportation's mandate to make revisions to the government's license plate program and he would work with transportation and the committee members on this initiative.

A number of committee members also suggested that five years of service should be properly acknowledged with a medal rather than a pin. All pins should be replaced with medals, which denote a greater importance. The department should ensure medal design adheres to standards in other Canadian jurisdictions. The Minister agreed to take the committee's suggestions into consideration and consult with the fire chiefs on any revisions to the current recognition program.

Water And Sewer

During its review of the department's draft 2003-2004 main estimates, the committee noted an increase in MACA's water sewer services subsidy. The purpose of the subsidy to provide funding to communities to assist with the provision of water and sewer services. These communities include Fort McPherson, Aklavik, Tsiigehtchic and Rae-Edzo. The Department of Public Works and Services charges full cost recovery plus a nine percent surcharge for the provision of water and sewer services to these communities. Public Works and Services recently proposed an increase to their current surcharge from nine percent to 16 percent, effective April 1, 2003. Committee members pointed out that the increase to MACA's water sewer services subsidy may have been made to offset the increased surcharge proposed by Public Works and Services.

Committee members questioned at length the rationale behind the proposed increment, as MACA would have to increase its water sewer services subsidy to communities to balance the increase in expenditures. The committee concluded that the proposed surcharge would severely strain communities. Communities are already operating with limited resources. The proposed increase is considered excessive and out of line with administration fees charged by other departments. Funding to offset the proposed increase may be used to fund more important programs and services. Significantly, the proposed increase was made without consultation with the client communities, their respective MLAs and the standing committees.

In a recent letter to AOC, the government agreed with the standing committees that the proposed increment was excessive. It assured the Members that until this matter is discussed with the affected communities, the current nine percent surcharge would remain unchanged for the provision of water and sewer services.

Plan Review Fee

The committee noted a significant decline in the department's projected revenue for its plan review fee. A few years ago, a recommendation was made by the government to implement a new fee structure for plan review services as part of its regulatory reform initiative. The proposed fee was to be based on a percentage of the project cost. This fee would be charged to building owners, developers and contractors who would submit drawings and specifications for review by the office of the fire marshal. The office of the fire marshal would review the plans for compliance with the National Building Code and the National Fire Code. The department had planned to implement the proposed fee effective April 1, 2003.

However, a recent court decision, Eurig v. Ontario, stipulated that the government's charges for providing services must be based on actual costs. Thus, the proposed fee structure for plan review services has been amended to a flat rate of $85 per hour. The revised revenue estimates are based on this hourly rate. A number of Members were concerned that the Eurig decision may have an impact upon the government's other "for service" fees and suggested that the government would be wise to review its current fee structures.

That concludes our report on MACA. Thank you, Mr. Chairman.