Madam Chair, with me I have Debbie DeLancey, deputy minister of Municipal and Community Affairs; and Sheila Bassi-Kellett, director of corporate affairs.

Thank you, Mr. Minister. At this time, I will ask committee members if they have any general comments on the Department of Municipal and Community Affairs. Mr. Ramsay.

Thank you, Madam Chair. I have a few opening comments for the Minister of Municipal and Community Affairs. I listened with great interest to the Minister's opening comments yesterday when he talked about the Arctic Winter Games. During our committee meetings, there was reference to this and in the committee report as well. The funding didn't show up in the budget and it was going to be brought in over a three-year period after the area that's chosen to host the games is chosen by the international committee. That announcement on which community will host the Arctic Winter Games in 2008 is one I'm watching with interest. It's either going to be the South Slave or Yellowknife. In an effort to get some transparency here and know what we are dealing with, it doesn't matter which community hosts, whether it's the South Slave or Yellowknife. What has to be done is MACA has to identify funding, a finite dollar amount, and go forward from there regardless of which community might win the bid by the international committee. That hasn't been done. According to the Minister's opening comments from yesterday, the Department of Municipal and Community Affairs won't announce the funding until after such a time as the community is chosen to host the games. I find that to be rather odd. I think they should be forthcoming in the amount of funding. To me, it doesn't matter which community hosts the games. The funding shouldn't be determined on which community hosts the games. I would like to ask the Minister about that first. Thank you, Madam Chair.

Thank you, Mr. Ramsay. Mr. McLeod.

Thank you, Madam Chair. The process we are following is the process that was used historically. FMB has indicated this was the route we should be using. We, at this point, do not have any indication what the communities are going to come forward for. The successful community would come forward with a submission and we don't know what that amount will be. In that event, we did have some discussions. FMB indicated that we should wait to see what the requests will be.

We have since had further discussions and we'll be talking to FMB to see whether it would make better sense to seek an immediate set amount for communities regardless of who is the successful bidder on the 2008 games. So we are going to have further discussions. At this point, we are following FMB's process to wait until the community makes a formal submission.

Thank you, Mr. McLeod. Mr. Ramsay.

Thank you, Madam Chair. I can appreciate what the Minister has to say. The point that I am trying to make is as a government, we are going to make the decision to fund the Arctic Winter Games for a period of three years leading up to the games. Strictly from a budgeting perspective, Madam Chair, that should be clearly laid out and I don't think it should be dependent on which community hosts the games. That way communities know the level of funding they are going to be able to get and the department can budget for it. Right now, neither is there. To wait until a decision is made, it just seems like a backwards way of doing it. I would rather see it done in an open, transparent and accountable way and not done this way. Maybe the Minister would like to comment on that. Thank you.

Thank you, Mr. Ramsay. Mr. McLeod.

Thank you, Madam Chairperson. We certainly can and we have discussed the merits of going forward with a set amount, regardless of which community is selected to host the Arctic Winter Games. There is concern, of course, that there could be a shortfall or it could be a lot more than what the community is requiring.

We would have to, in any event, provide detail to FMBS to the cost before any approval is made. We took their advice and we haven't included it in this budget as we will come forward for a supplementary once the request is made. We will have that discussion again with FMBS to see if we can work out some costing, some forecasting and maybe that might be a better methodology. We are not sure at this point, but it is difficult to predict or calculate what the communities are going to require. There are two communities that have put forward submissions for hosting the games, but we don't know what their needs are at this point.

Thank you, Mr. McLeod. Mr. Ramsay.

Thank you, Madam Chairperson. That is good; I thank the Minister for his response. The other thing that I just wanted to touch base on is the MRIF funding and the breakdown between tax-based and non-tax-based communities, and the fact that it is 55 percent to 45 percent in favour of the non-tax-based communities.

I know the Minister is well aware of my concern over the formula that was used and why we arrived at the breakdown that is evident here. I mentioned to him on previous occasions that 75 percent of the residents in the Northwest Territories live in tax-based municipalities and the greatest impact and the greatest ability to leverage what little funds there are, is available in the tax-based municipalities.

Not to downplay the need in the smaller communities. I know it is evident, but when you have this kind of money that you can leverage, I think it is important to try to get the most out of the money that you possibly can. I don't think, with the breakdown at 55/45, we are going to get the maximum bang for that dollar. I am not convinced of that.

The other thing I just wanted to mention too, was the fact that there is some additional funding, with the fuel tax monies that are going to be coming to the Northwest Territories. There is some criteria for a committee that is obviously going to be formed with the Northwest Territories Association of Communities and the Minister, for trying to work out how best to divvy up the funds that are coming to the Northwest Territories. I think one of the key things -- and it was the same with this MRIF funding -- was the impact on the population demand. Where the demand is, Madam Chairperson, I believe, is in the tax-based municipalities for some of this money. Like I said, it can be leveraged more than it can be in a non-tax-based community. As long as we are paying attention to that, that is all I had to say on that. Thank you, Madam Chairperson.

Thank you, Mr. Ramsay. Mr. McLeod.

Madam Chairperson, this issue on the division of the MRIF is something on which I guess we could have had a lot more discussion with the NWT Association of Communities, however, the timing was really difficult. It was over the Christmas holidays and we had not anticipated that we would be signing the MRIF agreement so quickly in the new year.

When the Minister indicated who was coming north, we had some discussions with his department and it was clear that we had enough time, if we fast-tracked everything, to have an agreement put in place. We based our allocations between the tax-based and the non-tax-based communities on a document, an assessment that we had done, measuring and looking at the infrastructure deficit across the North. In that document, it indicated that there was a deficit situation in both classes of communities. It was a higher deficit situation in the non-tax-based communities.

Therefore, we used that to base our decision on how to divide the formula. There is still a considerable amount of discussion that has to take place. There is a working group that has been put together with representatives from all the tax-based municipalities to work on the division of the 45 percent of the MRIF funding. We still are not in a position to sign off on the gas tax. We are working on an agreement, we started that discussion late last week. We are hoping to have the signing take place some time in late spring.

Of course, there again, we have to have a lot more discussion. We are talking with the NWTAC and we have a working group, we also have to work with the Department of Indian Affairs, so that we can make some of these decisions. We have a lot of consulting to do and we are also working on another initiative. Through the new deal, there have been some new monies allocated in this budget to top up and increase the Community Infrastructure Program. We have carved it off from the capital planning, or the capital process that we had historically. We have made it an independent amount that communities can use and we have, for the first time this year, allocated some new resources to the tax base.

We have indicated that we have targeted $3 million per year for the tax base to use towards their capital. We realize there are capital needs in all our communities and it is difficult to really pinpoint how to allocate the money. We also, when deciding on our MRIF, had the discussion about giving a fair amount to each community and, realizing Yellowknife has a big population, we took that into consideration. At the same time, the basis of our negotiation on MRIF was to have a base amount for the communities in the Northwest Territories, and so that is not split on strictly per capita.

There is a lot of money, as indicated in my opening comments. We have seen a significant increase in our capital budget for this coming year, for the following years, for the next considerable amount of time. We have finally some resources to put towards infrastructure deficit. I am hoping it is going to be a fair situation. We are really making every attempt to have the communities decide how they want that allocated. We have working groups dealing with the tax base, with all the community representatives. I am hoping and I am very comfortable that we will work some kind of solution out, so there is deficit reduction in the infrastructure needs of the communities for the next while.

Thank you, Mr. McLeod. Next I have for general comments, Mr. Braden.

Thank you, Madam Chairperson. To continue on this theme of the tax-based and non-tax-based communities, especially how it related to the new deal, Madam Chairperson. I am just going to lay out something here that may be my version of what this deal is about and the Minister and his officials can correct me if I am off base on this. One of the key parts of this new deal is recognizing that non-tax-based communities need to have the discretion and the jurisdiction to make more decisions on their own, using their own money for what they feel is right for their community. This brings their status, if you will, or their degree of independence much closer to those of tax-based communities, Madam Chairperson.

My interpretation of the new deal is that we are really narrowing the field for what we have come to understand as a non-tax-based community. Not only are we narrowing the field, are we potentially going to eliminate this whole notion that there is a non-tax-based status among our communities? Have I sort of got that right so far? Is that what we are trying to do?

Thank you, Mr. Braden. Mr. McLeod.

Thank you, Madam Chairperson. Madam Chairperson, the Member is quite right; we are working towards levelling the playing field. We are working towards giving a greater autonomy to the communities; letting the communities make their own decisions and, at the same time, providing the tools that are necessary for them to do so. We have targeted 2008 as the year that we want to see our communities move toward or become municipal taxation authorities.

They currently pay taxes, they do pay leases and those things have to be recognized. We want the communities to have greater say on capital. We want communities to decide what projects should go or what infrastructure they need and how they should budget themselves. We want them to be able to leverage funding from the federal government or from industry, or wherever the funding is available. We want to be able to have the communities become more independent and have a greater say.

There are a lot of communities, of course, that are not quite in a position to do that at this point. There are quite a few others that have been requesting this for some time. This whole initiative is based on some recommendations that have come forward, especially the recommendation that came forward from the Special Joint Committee on Non-Tax-Based Community Affairs from the 14th Assembly, and it is something this government has been working on for some time. That is where we are heading. Thank you.

Thank you, Mr. McLeod. Mr. Braden.

Madam Chairperson, thank you. The principle of this is something that I really endorse, because I have dealt long enough, Madam Chairperson,

with these situations. If communities indeed have more jurisdiction and more latitude to make some of their own choices, I think there would be more contentment out there with their situation. Along with that, of course, will come a much greater degree of responsibility and accountability at the community level. These are things that every organization and community has to be given, that rope, if you will, so that they can go out. There will be mistakes, I appreciate all of that, but we will have better and healthier communities as a result.

In that same area, Madam Chairperson, I see perhaps a comparison here with what I think has been a mistake of governance by this Assembly; that is in creating so many different areas of jurisdiction for health and education. We have created all these different regional boards and authorities in a number of areas. I think we are questioning now whether these are serving everybody all that well, in terms of their economies, their efficiencies, the duplication of services, the interpretation of policies of rules and regulations. That is my opinion.

I am wondering, in the sense where we are going to be giving communities...Some of them are small communities with limited capacity, we know that. Could we potentially be creating another situation where too much latitude, too much governance, too much authority is put into communities or organizations? That while it may be very desirable, politically, perhaps even financially, to take all these responsibilities on, is it really practical? Is it all going to have a good outcome?

Can the Minister give me some response on that basis? In terms of extending and expanding governance at the smaller community level, is that the right thing to do? Thank you.

Thank you, Mr. Braden. Mr. McLeod.

Thank you, Madam Chairperson. Madam Chairperson, I certainly think so or I wouldn't be doing it.

It has been something that has been really frustrating for communities across the North for many, many years. They really had no flexibility when it came to decision-making. We set the government's capital plan, we decide their budget, and we decide how they are going to spend it. It is a really paternal attitude that we have had for a number of years. It hasn't allowed the communities to grow. It hasn't allowed the communities to take on more responsibility and it hasn't really required the communities to be all that accountable, because we continue to go and move in and bale them out if they get into trouble.

We want to respond to the communities' requests to start making their own decisions and deciding what their projects are and the governance issues that they have to deal with. There certainly is a realization that not all the communities are ready for that. The Member is correct that some communities are really going to be having a tough time, but we have to start working towards that. We have committed that we will work with those communities to develop capacity.

We have already started talking. Our people from the School of Community Government are looking at the situation and starting to look at the programs that might be required to help enhance their skills. There are a lot of different things that we are going to have to do and we are probably going to have to do it for many more years. At the same time, we have a lot of communities that are moving towards self-government and planning and will be in the situation very shortly and we have to start moving towards that.

There are other communities that, although they are not in the self-government process of negotiations, have desired, have requested that we do this. That is why we are moving forward. It is something that the communities have been asking for. We realize that in a lot of cases, the capacity is not there, but we have committed to working with them and we will be working with them.

Thank you, Mr. McLeod. Mr. Braden.

The Minister has mentioned, Madam Chairperson, that 2008 is the target for a community to become a tax-based jurisdiction, or there seems to be some kind of terminology there. What I was wondering about was, by then, are we going to be able, in terms of the way we look at these programs in communities, to get rid of this idea that there are some tax-based and some non-tax-based communities.

It is not really a healthy kind of perspective, Madam Chairperson, for an MLA to have this sort of hard distinction between what one group of communities can do or could do and what others can't. I would really like to see us on a more level playing field. Are we going to get to that point where we can throw out this terminology, tax-based and non-tax-based? Thank you.

Thank you, Mr. Braden. Mr. McLeod.