Thank you, committee. 10-40, information item, lease commitments – infrastructure. Are there any questions?

I see none. Committee, we’re going to combine 10-41 and 10-42 together, information item, work performed on behalf of others, $6.277 million. Agreed?

Thank you, committee. Committee, if I can get you to turn back to 10-7, Education, Culture and Employment, department summary, operations expenditure summary, $305.599 million. Does committee agree?

Thank you, committee. Does committee agree that consideration of the Department of Education is completed as a whole?

Thank you, committee. I would like to thank our witnesses here today, Ms. Eggenhofer, Mr. Heide, Ms. Martin. Thank you for joining us in the House today. Of course, I would like to thank the Minister as well. Sergeant-at-Arms, would you please escort the witnesses out.

Committee, we are going to continue here with Transportation. With that, we will ask the Minister of Transportation if he has any opening comments.

Yes, I do, Mr. Chair.

Go ahead, Mr. Beaulieu.

Thank you, Mr. Chair. It is my pleasure to present the Department of Transportation’s proposed main estimates for the 2014-2015 fiscal year for consideration.

The primary business of the department is to operate the NWT public transportation system and provide for the safe, secure, accessible and reliable movement of people and goods between communities. The activities undertaken by the department also protect the infrastructure investments already made in our transportation system. The department’s work is balanced with meeting the increasing needs of communities and industry that are reliant upon our network of roads, winter roads, ferries and airports to achieve the goal of social and economic growth.

The department is proposing a budget of $126.2 million for 2014-2015 to maintain service delivery and to provide for modest improvements. In total, the department is proposing an 8 percent increase of $9.1 million from this year’s main estimates. This figure includes an increase in annual amortization expenses of $2.5 million, resulting from additional capital assets expected to come into service up to 2014-2015, $3.8 million in other adjustments, and forced growth valued at $3.8 million including Collective Agreement increases of $800,000.

The increase to the O and M budget is primarily the result of forced growth initiatives to cover the increasing cost of delivering contracts for highway and winter road construction and maintenance, community airports, increased regulatory

requirements across our airport system, and improvements to driver and motor vehicle licensing services.

Of the $3.8 million in forced growth initiatives, $1.1 million will address the cost to maintain Highway No. 3, a major route into the NWT experiencing maintenance challenges due to increased traffic pressures and permafrost degradation. The proposed budget includes $426,000 in forced growth to provide for increased operation and maintenance costs associated with the road licensing and safety computer system, called DRIVES. This important driver and vehicle licensing system enables the collection of over $9 million in commercial revenue and provides an operating platform to continue expanding on-line driver and motor vehicle services, such as on-line registration recently announced.

A total of $3.8 million in other adjustments were approved during the fall sitting of the Legislative Assembly. Of that sum, a one-time allocation of $2.4 million will provide for engineering and construction work to deliver a permanent repair required on the Inuvik Airport runway. The department implemented emergency repairs last fall when an area of the runway surface failed due to changing underground conditions. Engineering studies and design work are being undertaken to determine the cause of the surface failure and to identify a long-term solution for implementation in 2014-2015.

Other adjustments of $1.4 million will provide for crews, equipment, fuel, and supplies required to accelerate ice bridge construction and to extend ferry operations at the Fort McPherson and Tsiigehtchic river crossings on the Dempster Highway during the fall freeze-up. Overall, commercial vehicles endured fewer days of interrupted service than in previous years, from historical counts of 70 to 80 days, reduced to about 30 days. The extra days of ferry service were particularly important to resupply liquid natural gas and propane to the Inuvik region. The department is currently evaluating the operations from last year to incorporate lessons learned into the future operations.

For 2014-2015, the department is projecting a total of $74.5 million in revenue and recoveries. This amount includes a transfer payment of $46 million from the Government of Canada for the Inuvik-Tuktoyaktuk Highway Project. The department has signed the final federal funding agreement, received all land use permits and water licences, concluded land tenure and royalty negotiations, and has negotiated a design-build contract with a local company. The highway project is an important first step to realizing the long-term goal of an all-weather road through the Mackenzie Valley corridor. The department is enthusiastic to begin

constructing the largest and one of the most challenging infrastructure developments ever undertaken by the Government of the Northwest Territories.

Meeting the 17th Assembly’s priority of improving economic development opportunities is critically linked to investing in transportation infrastructure. The need for improvements to transportation infrastructure was highlighted last winter when the department’s regional operations in the Deh Cho and Sahtu experienced a marked increase in industrial traffic due to resource development. In anticipation of increased pressure on the winter road system this coming winter, the department worked directly with industry to accelerate the construction of ice crossings, strengthen the winter road surface, and increase the level of service to extend the operating season to the latest possible date in the spring. At the same time, the department is also working to improve safety by increasing the number of enforcement patrols on the winter road, improving our Mackenzie Valley winter road driving guide, and working with industry to ensure the safe movement of heavy loads. To achieve these improvements, the Financial Management Board approved a four-year target adjustment of $169,000 per year to fund casual highway maintenance supervisors and highway transport officers assigned to the Mackenzie Valley winter road. One supervisor will be based in Fort Good Hope, one in Norman Wells and two highway transportation officers will work out of Hay River.

The proposed main estimates also include forced-growth funding of $570,000 to provide Wekweeti residents with annual winter access to resupply the community with food and fuel at reduced costs and provide mobility for residents.

These are very brief highlights of the Department of Transportation’s proposed main estimates for the 2014-2015 fiscal year. I am confident the proposed budget will allow the department to continue providing for the safe and reliable operation of the NWT transportation system. I am looking forward to 2014-2015 and the exciting work the department will be doing, such as developing a multi-modal strategy and rolling out additional on-line driver and motor vehicle services to better serve our clients.

I am also confident that in 2014-2015, the federal government will provide support for our Corridors for Canada III funding proposal under the new Building Canada Plan to strengthen our transportation system, which is critical to a strong and prosperous future for all of us. Corridors for Canada III proposes an investment of $600 million across all regions of the Northwest Territories over the next 10 years. Strategic investment includes upgrading and rehabilitation work proposed on all eight all-winter highways, including Highway No. 7 and Highway No. 8; completing reconstruction of

the Detah access road, replacing the Inuvik air terminal building, and moving forward on the Mackenzie Valley Highway Project including completing an environmental assessment, and construction of the Bear River Bridge. Ongoing investment to our transportation system will lower the cost of living in our communities; enable and promote economic development such as oil and gas, and tourism; create jobs for Northwest Territories residents; and maintain the safety and integrity of the transportation system into the future.

Thank you, Minister Beaulieu. Minister Beaulieu, do you have witnesses that you’d like to bring into the House?

Yes, I do, Mr. Chair.

Thank you, Mr. Beaulieu. Does committee agree?

Sergeant-at-Arms, if you could please escort the witnesses into the Chamber.

Minister Beaulieu, if you’d be kind enough to introduce your witnesses to the House, please.

Thank you, Mr. Chairman. To my left is deputy minister, Department of Transportation, Russell Neudorf. To my right, assistant deputy minister, Department of Transportation, Daniel Auger.

Thank you, Minister Beaulieu. Mr. Auger, Mr. Neudorf, welcome back to the Chamber. Committee, we’re going to open this up with general comments. To start, I have Mr. Blake.

Thank you, Mr. Chair. I just have a few comments and questions for the Minister. First off, I’d like to start with the Louis Cardinal extended operations. Great idea. We had some success this fall mostly due to the mild weather in October and the first part of November. We had an extra two weeks, I believe, from what is normally experienced up in Tsiigehtchic and the Mackenzie Delta. Really mild weather, so that really helped us out a lot on the extension of the operations. I know we had a lot of challenges after the ice froze in there, as expected. I did try to caution the department that maybe the Louis Cardinal was too small, but actually, at the end of the day it did do the job. It did take a lot longer than expected, but I think the department has learned from that.

One of the things I noticed was that the department changed the contractors halfway through, halfway across the river, and that really slowed things down probably by a week. I think that was a bad move and that actually, from my own opinion, because of the inexperienced operator, it really busted up the ferry. That’s just my own opinion. I’m sure the department has some answers for that.

The question I have is: In the spring, will the ferry be maintained back to its regular operation? I think we see the need to actually have the Merv Hardie moved down there in the near future. It could have been ready for operation this spring if we just maintained it over the summer. We had three or four months for crews to actually get the Merv Hardie back into shape over the summer. We had a few months there.

The other concern I had was with the Dempster Highway. It’s really noticeable that there needs to be an increase in the O and M funding to resurface the highway. Because it’s a gravel highway, with all the traffic, all the material that’s put on the road, because it isn’t packed in when it’s laid down, it just goes off to the sides, and there’s only so much the grader operators can do in the spring to pull it back up onto the road. It’s pretty clear that we need to resurface the highway and make sure that it’s actually packed down by packers when it’s been done and lay calcium down right away. That way you know it’s going to have a little structure.

Other than that, that’s about the only questions. I know there were concerns raised by the community of Tsiigehtchic to actually work on an air strip, with all the challenges during the spring and fall, but actually, this fall there was very little disruption in the services because of the access road that was built into the community. I think that’s still a good plan moving forward as an interim, and then moved back to the actual where the ice road has been for the last 20, 30 years. Those are the only comments I have.

Thank you, Mr. Blake. Committee, we’re actually going to take general comments collectively here and we’ll ask the Minister to respond in one opportunity as we discussed earlier in the process. With that, I have Mr. Menicoche.

Thank you very much, Mr. Chairman. Finally a government document that references Highway No. 7. All kidding aside, Mr. Chairman, of course I have been using my favorite two words trying to get resolution over getting Highway No. 7 reconstructed and I know that it is very, very expensive. In the capital planning that we approved last fall, we are certainly making strides towards it and I just want to highlight it once again so we can keep paying attention to it. It is part of the Deh Cho Trail, the loop that goes from BC and all the way around to the Alberta border close to Hay River. It makes for great travelling for the tourists, knowing that they have good infrastructure that they can drive their very, very expensive motorhomes on and do the loop. They do inquire in Fort Simpson, one of our great tourism people, Mr. Ted Grant. People often can call him in the springtime when they want to journey up there and he does tell them up front, he tells them in the

springtime, don’t come up, the highway is very bad, it has collapsed in some places and it actually pains him to advise tourists not to come up that way. We are making strides towards it, a few places have collapsed and we have reconstructed that and it does make the case that, yes, we do have to continue our reconstruction and that is why I continue to press it as MLA for that region.

I guess I was trying to get some certainty, too, because we are all for the chipsealing of the section between the Fort Providence junction towards Fort Simpson and about 30 kilometres. The Members on this side of the House strongly supported that be done, be saved this fiscal year, it would last another year, I am afraid that we will be losing it. In fact, at the appropriate time the Minister can comment on that commitment and the commitment to save that piece of infrastructure there, because it is quite a pleasure for people from my riding and anybody driving through there, even though it is 30 kilometres, it is a nice little piece of road to drive on and look forward to more chipsealing. I think it’s from Checkpoint towards Jean Marie junction. I’m not sure if they plan to do it this year. I know that one section, about nine kilometres, has sat for a year already, so I am not too sure if the department is looking at chipsealing that this year. There is a further 10 kilometres that has been widened in preparation for chipseal. So I’m not too sure what the plans for that are. I know that the plans are there to widen the highway quite a bit; I’m not sure if they plan to chipseal that this year as well.

The other issue, when it comes to transportation, of course, is the Trout Lake Airport. At the beginning of the sitting of this House, I was quite frustrated and the community of Trout Lake is quite frustrated, too, that it has taken so long to build our new runway there. It is the pride and joy of the community and they try to be involved as much as possible and get as much economic benefit about it. They saw it as a huge opportunity to continue training their residents and they have done lots of training over the year, in fact, last term I did go there and they had trained an all-female crew using heavy equipment. So they look to those kinds of projects to develop their skills and to continue on with their skills.

It saddens me every time I hear that the project has been shut down, it has been deferred, it looks like it is a five-year project now. In fact, I think I said that at the beginning of this session, that we are doing the Inuvik to Tuk highway and to be completed in four years, a $270 million project and here we have a $7 million airport runway and it has taken us five years, and it is not even that long, I think it is only 3,000 feet or metres, anyway, or 3,500 metres and that is something they have been looking for. We want a win-win, the community wants a win-win, the department wants to win. It pains me to no end to see it delayed and deferred continuously. The

Minister did say in the House that they are looking for completion this year. Of course, I’m looking for reaffirmation of that statement as well.

I’m supportive of the Corridors for Canada III funding proposal and hopefully the Minister can get some good news and get to our committee and look at those priorities. I know that it also has to do with the Minister of Finance’s request for an additional $1 billion added to our loan amount that we could meet these funding plans that are laid out in Corridors for Canada III. With that, I will conclude, but also I think the Minister said it in his opening remarks as well. Increased industrial traffic north of Fort Simpson does make a case for additional resources.

On Wrigley road, I’m pleased to see that is in the capital plan. There were some plans to also strengthen some of the weakened areas on Highway No. 1 north of Fort Simpson towards Wrigley. As well, I’m so glad that perhaps the Minister can comment on this as well. It also makes the department to start developing a business case for continuing all-weather roads north of Wrigley as well. I certainly support that and the more traffic that we have there, the more development happens in the Sahtu. Shale does make for a business case. We have to take that momentum and jump on that. In fact, we may even have a long-term dream is to have a larger loop that tours can travel, which is straight up the Mackenzie Valley. Then they can go down the Dempster or come up the Dempster and down the Mackenzie Valley. That will certainly increase the amount of tourism to our great Northwest Territories. There will be a lot of economic spinoffs as a result of that. With that, those are my opening comments, Mr. Chair. Thank you very much.

Thank you, Mr. Menicoche. Continuing on with general comments, I have Mr. Yakeleya.