This is page numbers 5945 - 5992 of the Hansard for the 18th Assembly, 3rd Session. The original version can be accessed on the Legislative Assembly's website or by contacting the Legislative Assembly Library. The word of the day was public.

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Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

August 13th, 2019

Page 5973

Shane Thompson Nahendeh

Thank you, Mr. Speaker. Earlier this afternoon I did a Member's statement on some challenges that we see with infrastructure in contracts, so I have questions for the Minister of Infrastructure about big projects and the process the department uses. Can the Minister explain why the Business Incentive Policy was developed by the Government of the Northwest Territories in the first place? Thank you, Mr. Speaker.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5973

The Speaker Jackson Lafferty

Masi. Minister of Infrastructure.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5973

Wally Schumann Hay River South

Thank you, Mr. Speaker. The intent of the Business Incentive Policy when it was created was always to support the creation and growth of a competitive business sector in the Northwest Territories. As I have said in the House before, this is probably one of the best policies the Government of the Northwest Territories ever created. The policy recognizes the additional costs that northern operators experience in the Northwest Territories, and what this policy does is allow businesses to adjust their bids by 20 percent versus southern bidders, and it leverages our government in our procurement projects for investment in our business communities across the Northwest Territories.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5973

Shane Thompson Nahendeh

I have been advised that previously, with the Business Incentive Policy, it was for the whole contract, and now I have been advised that it's only based on a few million dollars, and I am a little bit confused. Can the Minister advise this House what the cap is when it comes to northern contractors bidding on projects using BIP?

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5973

Wally Schumann Hay River South

There is no cap for northern contractors bidding on projects. We welcome bids from northern contractors on all projects, but I think what the Member is referring to is the BIP adjustment within the BIP policy, which adds up the contracts to up to $1 million and over $1 million. I will read it all in verbatim, just for the public.

Section 8:

(8) Application of Bid Adjustment

Contracts Less than $25,000

Whenever possible, goods, services and construction valued at less than $25,000 should be purchased directly from BIP Businesses in the Local Community, but no bid adjustment will be applied.

Contracts equal to or more Than $25,000 and Less Than $1,000,000

(i) A 15 percent Bid Adjustment will be applied to the NWT Content. An additional 5 percent Bid Adjustment will be applied to any Local Content.

Contracts Equal to or More Than $1,000,000

(i) For the first $1,000,000, a 15 percent Bid Adjustment will be applied to the NWT Content and an additional 5 percent Bid Adjustment will be applied to any Local Content.

(ii) For that portion of the contract above $1,000,000, up to the maximum allowable bid adjustment:

a. 1.5 percent Bid Adjustment will be applied to the NWT Content;

b. an additional 0.5 percent Bid Adjustment will be applied to the Local Content.

The maximum bid adjustment for all bidders on northern or local content is $500,000. So that the Member is also aware, in 2018-2019, the GNWT had contracts of 1,501 contracts, and only 46 of them were above $1 million. Thank you, Mr. Speaker.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5974

Shane Thompson Nahendeh

So this policy has changed, from my understanding, and maybe the Minister can correct me if I am wrong, but what was the rationale for the department using this new process to up to a maximum of a half a million dollars?

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5974

Wally Schumann Hay River South

First, let's be clear. We are not limiting the contracts that NWT businesses can bid on. There is a limit in place on the dollar amount of the total adjustment that can be applied, and that is $500,000. While the intent of the Business Incentive Policy is to support northern businesses and recognize the higher costs of doing business in the North, we also have a public responsibility to ensure effective and appropriate expenditure of public resources. In a review that was taken a number of years ago, it was determined that the total bid adjustment of $500,000 was a fair amount and would offset any higher costs of maintaining a business in the Northwest Territories, regardless of what the overall value of the contract was.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5974

The Speaker Jackson Lafferty

Masi. Oral questions. Member for Nahendeh.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5974

Shane Thompson Nahendeh

Thank you, Mr. Speaker, and I thank the Minister for the clarification. I guess his definition of fair and my definition of fair is a little bit different. When I see a whole bunch of money going down south, it's a bit of a challenge. I know in BC they actually have a policy in place that, you know, gives incentives to businesses in their province to just keep the contracts there, and it's making it more of a challenge. Can the Minister advise the House here why doesn't the department have similar policies in place so it makes it harder for southern companies to come and take contracts from us, to go down and take the money down there?

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5974

Wally Schumann Hay River South

I think the BIP policy is more than fair. That is a $500,000 adjustment to a contract over a million dollars. That is a significant amount of money. As the Member is referring to the policy in BC, Infrastructure follows the BIP policy to the letter of the law, and we do that, and that is for NWT-owned and -operated businesses in the Northwest Territories, and that is what the BIP adjustment is for. What he is referring to, what BC is trying to do, I am not even sure if they are doing it. I have to double check it, but we cannot put restrictions on people bidding on contracts in the Northwest Territories, because this would breach our obligations under the Canadian Free Trade Act. I have had lots of opportunities to speak to different people about BIP and how things are working in the Northwest Territories, and a lot of people do not understand our BIP adjustment is subject to all of these Canadian free trade agreements and international trade agreements. Thank you, Mr. Speaker.

Question 799-18(3): Highway Infrastructure Projects and Application of Business Incentive Policy
Oral Questions

Page 5974

The Speaker Jackson Lafferty

Masi. Oral questions. Member for Tu Nedhe-Wiilideh.

Question 800-18(3): Alcohol Sales and Reduction of Bootlegging
Oral Questions

Page 5974

Tom Beaulieu Tu Nedhe-Wiilideh

Thank you, Mr. Speaker. In my Member's statement, I talked about alcohol impacts on our communities. I would to ask the Minister of Finance some questions on some of the items that I thought might help, hours of operation for liquor stores and purchasing limits. I would like to ask if the Minister or his staff can begin discussing the hours of operations with the communities that have liquor stores, to see if they are amenable to looking at hours adjusted, with the thought of combatting bootlegging. Thank you.

Question 800-18(3): Alcohol Sales and Reduction of Bootlegging
Oral Questions

Page 5974

The Speaker Jackson Lafferty

Masi. Minister of Finance.

Question 800-18(3): Alcohol Sales and Reduction of Bootlegging
Oral Questions

Page 5974

Robert C. McLeod Inuvik Twin Lakes

Thank you, Mr. Speaker. The consumption of alcohol and the effects of alcohol is a very sensitive topic across the Northwest Territories. A lot of people grew up with the effects of alcohol. A lot of people are still feeling the effects of alcohol, even today, and I totally agree with the Member. I mean, if there are steps that we can take to try to curb the consumption of alcohol, one of the first things we would like to do is we like to see people make the decision to quit their drinking. That is always a first good step, but we need to do what we can as a government and as a society to try to help them do that. Is shortening the hours or lengthening the hours going to help? We don't know that. They may. They may not. I can see shortening the hours as to maybe increasing the number of trips that people need to make to bootleggers because they don't have the liquor store open.

There are a number of things that need to be taken into consideration, and there is always a willingness to have that discuss with people. We have an election coming up in about a month and a half, and then there is a new slate of MLAs that will be coming out, a new Legislative Assembly that will be coming. Of course, there are going to be some new MLAs who come in as well. I think it would be and should be a priority of theirs when they come in, and it should still be a priority of ours as we are leaving the Assembly.

We need to take what steps we can. We see the effects of alcohol all over the place, all of the time, small communities, large communities. We would like to see what we can do to try to help alleviate the problem. Thank you, Mr. Speaker.

Question 800-18(3): Alcohol Sales and Reduction of Bootlegging
Oral Questions

Page 5975

Tom Beaulieu Tu Nedhe-Wiilideh

In my Member's statement, I spoke of the City of Yellowknife having discussing on operation hours of the liquor store. I think that the initial concept was that they would reduce the amount of hours, and it was, I think, rejected by council. I would like to ask the Minister if his department could have some form of dialogue with the City. It is quite possible that the best way to combat bootlegging with operational hours would be to have the liquor store open longer so that people don't go and feed the bootlegger, that they are able to go to the liquor store most hours that they wish to.

I am not advocating that the liquor store be open 24/7, but maybe something with more hours would have the people who are looking for alcohol go to the liquor store as opposed to supporting bootlegging.