The Committee met at 7:00 p.m. in the House of Assembly.

CHAIR (Joyce): Order, please!

Thank you very much. What we are going to do is ask everybody to introduce themselves first for the record. Jack, can you start introducing yourselves?

MR. J. BYRNE: Jack Byrne, MHA for Cape St. Francis.

MR. SHELLEY: Paul Shelly, MHA for Baie Verte.

MR. LUSH: Tom Lush, MHA for Terra Nova.

MR. WISEMAN: Ralph Wiseman, MHA for Topsail.

MR. ANDERSEN: Wally Andersen, Liberal, MHA for Torngat Mountains.

MR. H. HODDER: Harvey Hodder, MHA for Waterford Valley.

CHAIR: I am Eddie Joyce, MHA for Bay of Islands.

We are going to go with the normal procedure. We will ask the minister to have a few words, and then if the Minister would please introduce her staff. Also, when someone is asking a question or there is a response, can you please state your name for the record so we know who is speaking.

Minister.

MS J.M. AYLWARD: Thank you very much, Mr. Chairman, and congratulations on your election as chair. Also, good evening, members of the Estimates Committee.

I am delighted to be here tonight to present the estimates from my department. I will be including both Municipal and Provincial Affairs, and later I will do a little bit on Housing as a separate issue. My staff and I of course will be pleased to answer any questions. Before we get into the details I will make a few comments, but first I will introduce my staff here the evening.

To my immediate left is Bob Noseworthy, Deputy Minister of Municipal and Provincial Affairs, and Chair and CEO of Newfoundland and Labrador Housing Corporation. Sitting next to Bob is Ramona Cole, my ADM for Municipal and Provincial Affairs. To my right is Mary Marshall, who is the Chief Operating Officer of Newfoundland and Labrador Housing. Sitting behind me, to my far left, is Baxter Rose, the Executive Director of Policy and Planning. Sitting next to Baxter is Ken Curtis who is our budget analyst. Immediately behind me is John Moore, Director of Policy and Planning.

I would like to provide the Committee this evening with some direction in terms of the Department of Municipal and Provincial Affairs. As many of you know, because you represent a number of municipalities in your districts, there have been numerous challenges associated with financing in the municipalities, as well as the strength of local governments, adequacy of infrastructure, which is an ever increasing challenge, and the efficiency of our service delivery in the municipalities.

Over the last few years, the department has moved away from doing things for the municipalities and has really focused on helping the municipalities to help themselves. That has been clearly the focus of the department. We will continue on this track over time.

From a financial perspective, the department has undertaken a number of initiatives again, which many of you are familiar with, but for the record, as you know, we will be contributing a further $5 million to the Debt Relief Program, as was announced. This brings our total funding to $22 million, which is a very important component of working with the financial stability, helping municipalities. We have finalized agreements with sixty-three municipalities and we are in various stages of negotiation with sixty-nine other municipalities. We have refinanced $125 million in seventy municipalities at a much better interest rate. We have reinvested the savings that we have achieved in local infrastructure and in the operations. The Debt Relief Program requires the same tax structures as we would in keeping in line with provincial norms. Our provincial-municipal operating grants are $21.5 million. As you would know, these are unconditional grants we give municipalities to help offset the cost of their operations.

Continuing with debt subsidies is $61 million. This is an annual contribution towards water and sewer servicing debt. About $41 or $41.6 million of that goes towards water and sewage, and about $20 million goes to service debt loans on local roads and paving and other issues around recreation facilities, et cetera.

On a per household basis, this year my department will invest $530 for every household in every incorporated community in the Province. We have on a regular basis but more, I guess, particularly over the last number of years, been working with municipalities to encourage them to impose tax structures which are more representative of the cost of services. We continue to try to create an awareness of the cost of services because, as you know, providing services in all our municipalities is an ever increasing challenge. Not only providing them but looking at repairs, maintenance, et cetera.

We have had a very busy year in terms of legislation. We have introduced a new Municipalities Act. Many of the issues around that Act have been very familiar to us over the last number of weeks, particularly around the requirements of councilors to have paid their taxes, of course, like everybody else prior to the end of the year. This new Municipalities Act was introduced in the last fiscal year. It was intended to remove, and has removed, many of the restrictions that municipalities have worked under over the last number of years. It is a piece of legislation that was worked on cooperatively with the municipalities. Just about everything that was put forwarded was discussed in great detail and was certainly at the request of municipalities. It does create a significant amount of autonomy over their own economic development, in their taxation matters and again, I think, particularly over their service delivery. It is something that they have been working with us for the last number of years. I think maybe ten years for sure.

This year in the House we also plan on introducing a new urban and rural planning act. Again, the focus will be to provide greater autonomy around land use. Regional planning will be able to be conducted at the local level. As well, provincial land use policies will be utilized at that level. There will be greater autonomy certainly for development and approval of their own planning policies, because, as you know, right now much of the planning and development is bottlenecked, having to come into the minister's office, when with this piece of legislation they will have the autonomy to develop their own planning policies. A very important component of this, of course, is the public consultation piece, and that will be a very clear part of the development of their planning strategies and also their development regulations.

This year we will also begin modernizing the municipal elections legislation with the hope of having that in place before the next municipal general election in the fall of 2001. We have been working on those issues with the municipalities and will be moving that forward as quickly as we can.

In terms of professional development, the department, in conjunction with the Newfoundland and Labrador Federation of Municipalities, the Newfoundland and Labrador Association of Municipal Administrators and the Combined Councils of Labrador, have entered into a Memorandum of Understanding on municipal training. This agreement will result in a coordinated training focus, a comprehensive training framework for elected and appointed officials, and a more professional level of local governments. Again, this is all with a combined, concerted effort to enhance the accountability framework of councils and to allow them to conduct their job in a more, I guess, professional way, but also allowing them to gain more information about the new Municipalities Act particularly.

The department also recognizes the need for municipal infrastructure and recognizes clearly the high cost of providing this infrastructure and our inability, I guess, as a government, as many of the towns certainly know, to provide such an infrastructure. So the challenges remain quite high and we try to respond, as best we can, through initiatives such as our Municipal Capital Works Program. As you have heard in our Budget, it will $20 million this year, and it will be cost-shared. It is generally on a 50-50 basis. We are hoping, again, to be able to leverage a significant amount of money so that we will have about a $35 million operation as it relates to capital works. Approximately 140 projects will be approved, looking at infrastructure in about one hundred municipalities, and it will include such issues as water and sewer, solid waste management, road construction, recreation and fire protection. Twenty-six projects funded under last year's $106.4 million multi-year capital works in ten municipalities will be undertaken or they will continue this year.

Innovative technologies will be also be continued to be explored. I think we are very pleased with some of the pilot projects and we will be continuing to look at more innovative ways, particularly around water and sewage servicing.

As for disaster assistance, as many of you know, particularly some of our colleagues that represent constituencies on the southeast coast of the Province, and on the southwest coast, we had an unusual storm surge in late January. It caused significant damage to municipal infrastructure, protective sea walls, breakwaters, as well as personal property in a number of communities. We have had a preliminary assessment done and it indicates right now, the total damage to be in the range of $4.3 million. You have probably noted that amount in the Budget, that amount has been allocated, so that we can move as quickly as possible once the actual assessment and evaluation is completed. We are expecting that should be completed within the next ten days to two weeks, and we will be able to authorize the preparation of the specifications and the tender documents as quickly as possible so that we can get that community restored and compensate those who are affected with the appropriate damages for compensation. Again, I will be making more information available as this is finalized with respect to compensation and the details of the plans within the next couple of weeks.

I think one of the highlights of our Budget, from our perspective, and certainly one that we are quite proud of, is the Northern Coastal Labrador Strategic Initiative. It is a strategic initiative very much focused around partnering and working with a number of organizations: our department; Newfoundland and Labrador Housing; Works, Services and Transportation; and also groups such as the Torngat Regional Housing Co-operative; the LIA; municipalities and housing committees. We will be delivering a combined infrastructure program of about $23 million in the five Northern Labrador communities of Nain, Hopedale, Makkovik, Rigolet and Postville.

I won't go through all of them in detail but you do know that this includes a $7.7 million initiative over three years for housing; $6.5 million of that is for new housing and $1.2 million is for renovations on existing housing. This will work out to approximately sixty-five new homes for the area and 120 renovations in terms of grants. We will be also allocating and spending $6 million for roads over two years - mostly upgrading - and $9 million for water and sewage over three years.

To conclude my comments, so we can get to the questions part, we are working with and really on behalf of municipalities, trying to give them as many of the tools and resources possible to allow them to take greater control of their affairs and become masters of their own destiny. It is certainly their wish to have more autonomy and I think, through our Municipalities Act this year, we have been able to achieve that. Now we are helping them get more familiar with the act so they can work and conduct their business in a very professional manner with respect to the act.

We are also very much providing and supporting an environment for change. We recognize that perhaps some of the ways we have been doing things are not sustainable and we look for new and innovative ways for doing initiatives, particularly around infrastructure and water and sewage.

The legislative tools are very important and, as I have mentioned, we will be moving forward with a new rural and urban planning act as well. We hope to continue to partner more with our stakeholders. We have maintained a very good relationship with our municipalities, and we have consulted greatly with them over the last number of years. I hope that will continue as we work to try to achieve some of the challenges we have in our municipalities and constituencies.

Thank you very much for your attention, and I would certainly be happy to answer any questions that you would have. Also, in a few moments, when we move off the questions, I would be happy to do an introductory comment with respect to the housing.

WITNESS: (Inaudible).

MS J.M. AYLWARD: Do you want me to move right into the housing piece?

WITNESS: (Inaudible).

MS J.M. AYLWARD: No? Okay.

MR. H. HODDER: (Inaudible) the general practice is that we would rotate among members for ten minutes and then we would move on to somebody else.

WITNESS: You have the floor.

MR. H. HODDER: I have the floor. Thank you very much.

I want to thank you, Madam Minister, for your overview of things that have been happening within the department. Some of them go back to the days when I was on the federation executive. I did have a few years in municipal government - just a few - twenty-three in total.

Some of the issues that I wanted to mention, and one of them that I will start off with, would be the whole municipal infrastructure. We hear that many municipalities, of course, were anxiously awaiting this year a new federal-provincial agreement. There was a huge shopping list, as you would know, and the federal government, of course, did not see fit to enter into that kind of agreement at this time to the extent that might have been anticipated.

I want to ask you a question. First of all, to what extent and what kind of analysis has been completed of the state of municipal infrastructure in the smaller municipalities where there aren't engineers and where we do not have access to these kinds of competent people on a daily basis? And what kind of analysis have been done as to the status and the state of municipal infrastructure in our municipalities?

MS J.M. AYLWARD: I think, Harvey, if you were to ask me that on a community-by-community basis, that is a fairly comprehensive question. Are you asking with respect to the federal-provincial infrastructure program, and the needs, or are you asking me on behalf of my department?

MR. H. HODDER: Let's break it down.

First of all, I assume that the department has an analysis done of the need for a comprehensive infrastructure program in Newfoundland and Labrador. While we will never, ever, be able to meet all those needs, I want to get a comment from you as to what the total need is, and to identify whether that is in water and sewer or whether it is in the other areas, in roads and in bridges? How is it broken down? Do we have some kind of assessment done of the state of our municipal infrastructure in the Province?

MS J.M. AYLWARD: We know that if we were going to complete and upgrade all of the water and sewage in the Province it would take about $3 billion, which would be our whole provincial treasury.

WITNESS: (Inaudible).

MS J.M. AYLWARD: We should do that one year, yes. We will all just stand still for a year while we do that.

That just covers that piece of it. If you are talking about the roads, that is another - did you say that was close to $1 billion in -

WITNESS: One billion dollars for treatment (inaudible).

MS J.M. AYLWARD: One billion for treatment and $2 billion for distribution. In terms of the roads, I would not be able to take an estimate on the roads because I think after any given winter you can probably up the ante on the cost of the roads. I think in terms of the overall cost it is a huge challenge, as I identified in my opening comments.

In terms of any given point in time, as you know every year the infrastructure we have in place is aging. We know in some places we have clay pipes, for example, for our water and sewage. There are many communities and municipalities that perhaps will never have water and sewage if we are continuing to go in the same vein that we have been going in because we just will never be able to afford it. That is one of the reasons why we have looked at trying to do innovative technologies and pilot projects around bio-green projects in different ways to manage sewage and those sorts of things. It is quite a high cost, as you would know. I guess over twenty-three years the $3 billion figure alone for water and sewage is not one that would startle you.

With respect to the federal-provincial infrastructure program. I really cannot give you a lot of detail on that at this point in time. We are ready and willing to begin negotiations immediately, and we are certainly glad that they have not allocated a specific amount per province or based on a region, because we want the opportunity to get in there and plead our case to get the maximum amount of money we can. Because we do believe in equity as opposed to equal in this case. We believe that our needs are great and that we will make the best case we can to get an equitable share as opposed to an equal share in comparison to other provinces.

MR. H. HODDER: I have a follow up question. Some municipalities are saying: If we you look at the decrease in capital funding, decreases in the MOGs, the fact that the infrastructure is aging, and the fact that municipalities are cutting back in any way that they can, is there any assessment being done to compare the state of municipal infrastructure in the year 2000 with its state, let's say, ten years ago? Because as we give more autonomy and we say: You are more responsible, then when we are shifting this burden from the provincial government and from the federal government directly onto the shoulders of municipalities, are we not really while we are doing that saying in effect that we are willing to accept a lower standard of infrastructure in some of these municipalities? Because we have to know that the majority of these municipalities cannot afford to maintain their infrastructure up to the status that it was, let's say, ten years ago.

While I applaud initiatives, for example, in the sewer treatment - I am familiar with several of these, and they do show some promise - and while we do know that there is some direction there, and we also admit that you cannot have water and sewer in every household in every rural community, I have concerns that some of our rural communities in particular, where they do not have an economic base, maybe today are worse off than they were, let's say, ten years ago. They are not progressing. They are getting autonomy, but not in the resources to be able to meet the infrastructure demands that would let them maintain the standard which they would have had, say, a few years ago.

MS J.M. AYLWARD: In fact, Harvey, I would say the opposite is true in a number of municipalities, because in addition to the autonomy we have transferred the money. In as much as we have been able to transfer money and provide services - if you look at our Municipal Operating Grants being maintained at $21.5 million, and also our Multi-Year Capital Works Program - that has allowed many of the municipalities to do much of the upgrading and servicing. Is it enough? Certainly not. Would we like to have more money? Absolutely. Will there always be an increasing need? To me it is just like owning a home, especially if you have an older home. When is your home ever completely finished? Because it is my experience that as soon as you finish one thing something else needs to be done, whether it is a floor or a basement or a paint job or whatever.

So yes, I think the needs will always be there. I think that is why we have been working very hard with the municipalities in our Debt Relief Program particularly to make sure that when they do take on new debt that, (a) they are able to pay for it, and (b) it is on a priority basis. So they set their own priorities. What we have found more recently in working with municipalities is that they will come in with five priorities because it is very difficult to choose, but when you actually sit down with them and have an opportunity to discuss what their real priorities are, they will very often go to the water and sewage as their main priorities, even though many of them would like to have a stadium or other forms of infrastructure. For the most part that is their priority.

Every single one of them that I have had an opportunity to speak with in my short time as minister, just over two months, will all admit that there will never be enough money to do the municipal infrastructure that those communities will need, not only because of the cost, but also because of the tax base, also because of just the wear and tear on existing structures.

I think you need to package it all together. We have a $20 million Municipal Capital Works Program this year, part of the $106 multi-year Municipal Capital Works Program which was really identified for major and bigger municipalities, and really to the benefit to the smaller ones. Because if you have your bigger municipalities drawing down on this amount of money over a long period of time, while the smaller municipalities cannot avail of this multi-year project, obviously, fewer municipalities are going to be looking for the Municipal Capital Works Program. That is how we have tried to do it.

Even with our Debt Relief Program we are very conscious when we go and try to work with municipalities that they are able to sustain any new debt they take on board. By and large, I think, $530 per household is really among some of the highest contributions across the country in terms of municipalities. You would know as a municipal councillor that when you are providing services to a province as vast as ours it is quite a challenge and, I think, quite frankly, all things considered, based on our population, that we have done a very good job at doing it, keeping in mind there is always room for improvement.

MR. H. HODDER: Thank you, Mr. Chairman.

CHAIR: Mr. Wiseman.

MR. WISEMAN: Mr. Chairman, I certainly want to go on the record to commend the minister and the department for the job they are doing with the infrastructure. I can say quite clearly that in my district - speaking for the towns of Conception Bay South and Paradise - we are doing extremely well under the multi-year proposal. We will see about $35.6 million spent over the next three years in Paradise and Conception Bay South, which will mean that we will end up with about 85 per cent of Conception Bay South serviced which is the largest town in the Province, and we will have all the main lines put in with a sewer treatment plan in the town of Paradise.

Without the support of the department and government this would not have been possible. This is a very major accomplishment, I think, for the department, because it has been ongoing for a number of years. I have been around, but not as an elected member, since 1989. I know the difficulties with trying to meet piecemeal the Municipal Capital Works Program, and I know the challenges that the department has faced, but what it will mean is that there will be more money for smaller municipalities. Now I may have more to say on that later on, but I just wanted to say that for the record. Those are all the comments I have at the moment.

CHAIR: Thank you, Sir.

Mr. Lush.

MR. LUSH: I have a mixture of what we find in rural Newfoundland in terms of municipal government. I have some councils, the majority of municipal councils, I have some local service districts, and a very small number - thank God - of unincorporated areas. Not many. I think I just have two towns that are not incorporated, out of thirty-one or thirty-two.

I wanted to probably just pick up on some of the things that Mr. Hodder had been saying. For some time, for many years - I don't know who the first minister was when I came to one of those. Well, I didn't come to one of those because we did them in the House of Assembly; but I remember very early in my tenure, when Mr. Brett was Minister of Municipal Affairs, that the government was then going to bring in a rather innovative policy re water and sewer in some of the smaller rural areas of this Province. I do not know how long ago it was - it was certainly about fifteen years ago - and I have been waiting for that innovative policy.

It has to be difficult, obviously, because in that length of time we would have had it done; but it does seem strange, in this day and age, that the only system we seem to be working with is what I call the Cadillac system, and very expensive. As the Member for Mount Pearl said, I think it is highly unlikely, highly improbable, that ever many of those towns will be able to have water and sewer under the conventional method. It is not going to be done. I would just like for this creative way, this innovative way, to get moving; and I am not naive enough to believe that there are not some problems.

So, I would plead with you to do something because many of our people are coming to the situation themselves where they realize that they do not want a Cadillac system but everybody wants water. Everybody wants sewerage today. I don't think it is necessary for us to go to the Cadillac system. There are other places in the world that we can look at, obviously, that should be able to give us some examples of a cheaper, more economical way to provide our people with water and sewer without going with this Cadillac system which has to be tremendously expensive for many of the areas in the Newfoundland; because putting services in Newfoundland is very expensive wherever it is. Again I have, in my own district, both extremes.

In the one case you are going through solid granite and in the other place you are going through bog where you cannot find bottom. We have both extremes, which makes it very difficult, so I certainly hope that it will not take another fifteen years before we will come up with a system that provides water and/or sewer to the rural areas of the Province.

The other question - that is not a question, I suppose - an inherent question built in the comments: When and how soon will we be moving to a new innovative way for water and sewer, I suppose, could be the question. Number two which I want to raise is sacrilegious, but I want to raise it. Where are we? Where is the government's policy now re integration, regionalization, a coming together of towns without using the big bad word.

I have communities in my district that want to be integrated, that want to come together. Would you believe, they have asked the question? They have said: We have even contacted the government and notified them of our interest and our desire to do this. I don't think we have any record of it, but this is what they tell me. I am talking about the Eastport Peninsula in particular, many of the communities there. That is where we have all councils there. The only two towns not incorporated are on the Peninsula - two small towns, Burnside and St. Chads. The Peninsula has indicated their desire to come together as one regional council, and I am just wondering what our policy is on that. I know we are not out promoting it, as we were one time, or trying to sell it. Is there a policy promoting that in terms of people, councils approaching the government, that they would assist, encourage and help them to come together as one region, one government?

MS J.M. AYLWARD: Actually, Tom, if I may, I will answer your first question first about moving away from the traditional Cadillac system. In fact, over the last number of years - I can't go back to twenty-three that you referred to - over the last two years we have made very good progress in terms of innovative technologies all around the Island, in fact. In Twillingate, we have a filtered suspended system that dissolves solids from drinking water sources, for example. In Corner Brook, we have a biogreen system which is self-contained and it treats raw sewage. In Cox's Cove, another biogreen system is being tested. In Benton, Central Newfoundland, we have another non-mechanical system in place to treat raw sewage. In Port au Choix, Grand Bank, Conception Bay South and Ramea, as well as Paradise and Portugal Cove, we have been doing innovative technologies as well. Some of them to purify water and others to treat sewage. We have done a fair number.

What we are looking at doing is - when we have an opportunity with communities that are open to this, or recognize that they will never have the traditional Cadillac system not only because we can't afford it, I think we have all come to the realization that we don't need sewage pipes the size of the ones used in New York City to sustain the needs of smaller communities.

We are very open to looking at these cost-effective alternatives, recognizing that no one system is going to be suitable for everyone, like we have done in the past. We have a fair bit of innovative technology happening, and many of our colleagues will be more familiar with it because they are in their constituencies. It is moving along quite well and there is more coming on stream. The difference we are using now is that we are evaluating what works best. Before we sink a fair bit of money into doing anything in a more universal way, we would want to test them for that particular area. I think that is something we are feeling quite positive about.

With respect to your second question, you danced around the word, but I think you were talking about the A word or the R word, whether that is amalgamation or regionalization. We have been encouraging the regional model, as you know, in a voluntary way. Our greatest priority over the last year has been trying to work with municipalities, and I will be very clear about this, in this new Municipalities Act. It is a huge initiative that we have undertaken, about ten years of consultation. I think John Moore has more tales to tell about this consultation process - he is sitting right behind me - and about everything that has been involved in it, and we are still in the process of educating municipalities about it. That was certainly one of our main priorities.

While we have other pieces of legislation in place, Bob, I know, is very interested and committed to moving forward on this initiative particularly. We have actually tried to move the process forward even more recently so that communities that are interested in sharing on a regional basis - we do, in some events, in some instances, encourage emergency response vehicles, for example, and we find that regions will come together on initiatives like that. There are other initiatives as well that communities will come together on. We are certainly open to it. We do have a policy that supports that but we haven't been out going around the Province drumming it up, so to speak, and only because of our priorities in the last year-and-a-half where we have been very focused on the Municipalities Act. Undoubtedly we will be focused on the municipal elections act to get it ready for next year.

The whole issue around voluntary regionalization is certainly very important to us, and wherever we can encourage communities to work together - we have a good example in your region of trying to build an arena in that particular area, and getting all of the areas to come together to support one another on those initiatives. It is sometimes a challenge for a lot of reasons, because many of them come from different tax bases and they have different debt loads and different abilities to pay for services. Wherever communities voluntary come to us looking to share in a regional capacity, we would certainly be willing to look at that and we will have policies developed very soon which we will be, I guess, bouncing off our municipalities as well before we put them forward.

CHAIR: Mr. Shelley.

MR. SHELLEY: Thank you, Sir.

I have a few comments and questions all mixed together, and some specific ones that come right from the Estimates. First of all, just to jump on Mr. Lush's comments, I am from a very similar area with thirty-three communities, very small communities for the most part, with the three bigger communities being King's Point, Baie Verte and La Scie.

I don't need to tell you or any of the rural members especially, but over the last few years coming together and trying to do something with restructuring the debt has been very important for my part of the Province. We have had some success in the last little while. As a matter of fact, I have been in with your department - prior to you coming to the department - to work with communities on looking at that and really taking a whole new attitude towards trying to restructure their debt so they can get on with doing things with infrastructure, water and sewer and so on.

My first question is just sort of a general one but towards debt restructuring. Are you being able to accommodate to date the communities that have taken that approach of restructuring their debt? Basically, are you keeping up with the list of requests for communities in debt restructuring?

MS J.M. AYLWARD: As I mentioned in my opening comments, we negotiated about sixty-three this year compared to about fifty last year. We have another sixty-nine in various stages of negotiation. I think that if we were to look at servicing all of their debt we would probably need about another $33 million to $35 million. We are working as best we can. Every community will be considered. As you know, there are criteria for accessing the debt relief and you would be familiar with it, having used the program, that communities must be prepared to increase taxes to what we consider acceptable levels, including property taxes, water and sewage and poll taxes. If they are willing to do that, and if they are getting their maximum capacity in terms of collection of taxes, then we would certainly work with them to try to help them in whatever way we can. They would try the banks first, because they can get a better financing rate there than they have with NMFC. We will go through all of those hoops and hurdles to help the municipalities as best we can. We do have, as I said, about sixty-nine more in various stages. Seventy of the municipalities have refinanced for $125 million, getting better interest rates, so certainly it has been somewhat successful in that regard and the money has been put back in the infrastructure so we are pleased with that as well. Sure, we could always use more money for more debt relief.

MR. SHELLEY: Basically, you are pretty close to meeting the demand of the requests. At least you are in the midst of the process of dealing with those people. None have been really turned down flat, to date.

MS J.M. AYLWARD: Nobody gets turned down. Well, if they are not prepared to do what they need to do then they won't qualify, but nobody gets turned down. I think that is something I relish the opportunity for saying because it is very clear that for every single municipality that comes to the department looking for debt relief, we will work with them and go through the process. Before they qualify they have to be willing, as you know, to achieve what we consider reasonable taxation levels and poll tax. They try to refinance at the banks, and even if they are able to refinance and able to assume more of a debt load to do some other part of their infrastructure, then we will work with them.

The 30 per cent mark is really just a target for us, and if they are able to assume a 40 per cent debt financing, we will work with them on that. The 30 per cent is just what we use as our target to work with the municipalities, but we know there are other municipalities that are well able to carry a larger debt load because of their taxation base, and more importantly, their ability to collect the taxes.

MR. SHELLEY: Yes. I do know it firsthand. I have actually sat down with councils and convinced them to raise taxes.

MS J.M. AYLWARD: Exactly.

MR. SHELLEY: I knew where that was coming from. It is give and take all the way around, and that is not always easy either, convincing volunteer councilors to -

MS J.M. AYLWARD: It isn't, and I would say that as easy as it was last year it is going to be a lot harder this year considering what is coming next year for them, in the terms of an election. I'm sure they won't want to do it, but many of the councils have taken advantage of it. They have done tough things. I think if you are hearing that towns are saying they are turned down, they weren't turned down. Nobody is turned down. What happens is everybody is assessed but they must be willing to at least do what other municipalities have done to try to be fair.

MR. SHELLEY: I agree with that. That is why I have encouraged the communities that I have talked to, and worked with your department in doing that.

The next one is Fire Protection Services. Could we just get updated this year about how much is going into that? Is it still going through the same procedure, in through capital works, and then requested through the Fire Commissioner's Office?

MS J.M. AYLWARD: There is a line entry in there on the Fire Commissioner's Office. Is that what you are talking about?

MR. SHELLEY: Yes.

MS J.M. AYLWARD: As you know, that budget was increased this year.

MR. SHELLEY: Yes.

MS J.M. AYLWARD: It was increased in two ways. There is one extra position added to the Fire Commissioner's Office and there were salary increases for those working in the Fire Commissioner's Office due to reclassification.

In the Budget Estimates there is a slight decrease because there was some one-time costs associated with the oil refinery. There was also some one-time costs associated with both the fires in Charlottetown and Badger, but by and large the budget for the Fire Commissioner's Office has increased. By allocating a new position, and of course the reclassification cost, that will allow us to enhance the training throughout the Province because of the increased body.

MR. SHELLEY: Yes, that is what I was asking. So that increase covers a new position at the Fire Commissioner's Office, but there is actually no increase in the amount of money allocated for fire departments throughout the Province. Is that right?

MS J.M. AYLWARD: If you are talking about the capital piece -

MR. SHELLEY: Yes.

MS J.M. AYLWARD: - there are two components to the capital piece. Under our special assistance last year we cost-shared $4 million for twenty-four new fire trucks.

MR. SHELLEY: Yes.

MS J.M. AYLWARD: Under capital works, sorry.

MR. SHELLEY: Aside from that one.

MS J.M. AYLWARD: Aside from that money, there is an allocation that we have done, I guess, on an as-needed basis, under our special needs for equipment associated with fire-fighting pumps and -

MR. SHELLEY: Yes, that one. That stays the same, doesn't it?

MS J.M. AYLWARD: - breathing apparatus and those kinds of things.

MR. SHELLEY: Yes, equipment.

MS J.M. AYLWARD: I don't know if you say it stays the same. What we have always tried to do is look at the requests and try to meet the needs as best we can with the requests, but if you have a town or an office that is coming to us and saying they have no breathing apparatus or pump, we have to certainly look at those to meet the needs. In terms of the Fire Commissioner's Office, there was an increase in the budget, and in terms of our ability to provide fire trucks particularly, like I said, $4 million at 50-50 cost-shared under our capital works program for fire trucks for twenty-four communities.

MR. SHELLEY: Yes, I know about that one, but the specific one I was referring to here this evening is not about the salary job, assorted fire trucks, but the equipment money. It has been basically the same for the last couple of years, I understand. Is it still the same, specifically, the equipment for fire protection?

MS J.M. AYLWARD: It has changed over the last couple of years because there was a point in time when we were not buying fire trucks out of our capital. We were doing some of it out of special needs, special assistance. I'm getting my last department confused with my first department, special needs. It is special assistance. What we have done, particularly over the last year, is we have increased our 50-50 fire truck purchase under our capital works program. We have used our special assistance program for, as you know, the pumps and the breathing apparatus and other pieces to go with it. So that is something we would judge based on need and that is how we have always done it.

MR. SHELLEY: Can I have one more?

CHAIR: Yes, Sir, you go right ahead.

MR. SHELLEY: I will try to finish up. I'm not looking through the Estimates too closely there yet, but on job creation, the one that was just cluing up, shall we say, what was the total allocation for that this year and is there more coming? I guess that is the best (inaudible).

MS J.M. AYLWARD: As you know -

MR. SHELLEY: Let me make a comment on that first minister, because there are all kinds of different comments that happen on that. I have maintained the same thing I have always said for the years I have been here anyway. Because I deal with the reality of it, with how it affects the communities in the district I live in. By the way, when you see the allocation for my district - and Mr. Joyce and people with a lot of communities understand - when you are talking about thirty-three communities in mine, I think forty in Bonavista South, when we get the allocation we have we are talking about, for the most part, $3,000, $4,000 or $5,000 for a small project within a community. The importance of that, to my district for example - and I am sure I am no different than the other bigger districts - I can show where it has helped people deal with the reality of it. Not that they are the long-term answers to these things, but I am going to tell you that they are beneficial if they are used properly. So I am wondering about this year for that also.

MS J.M. AYLWARD: I think you raised some very good points and I am very happy to hear your support for the Job Creation Program because I think -

MR. SHELLEY: I do.

MS J.M. AYLWARD: - we recognize that this program is really allocated to meet the needs of short-term work in very high unemployment areas of the Province. What you will see from anything you look at is that it is really not about which district gets it, it is more of a rural-urban split. Our rural districts certainly do much better by far, and obviously, as you pointed out from your comments, based on need.

This year we allocated $3.9 million for job creation, and yes you are right, it is coming to an end for this fiscal year. We do not budget in advance because, again, it is based on need. In the past we have been able to introduce the Job Creation Program to lever different funds, whether it is federal or other sources, and we have to look at sort of what is needed out there. We really gauge the input we get from members on all sides of the House to try to meet these needs. So I cannot tell you what will happen in the future. We are just finishing this year's Job Creation Program and we have heard very favorable comments about how it meets the needs, although the average is only $7,700 per project, and the average number of weeks worked is only six weeks. We believe that it is a very successful program with 98 per cent of the total amount being allocated for jobs and less than 2 per cent, I think it is 1.3 per cent, spent on administration. Most of the administrative cost of programs associated with this type of initiative is about 8 per cent to 10 per cent administrative. We have one person working in our administration and you all know who that person is.

MR. SHELLEY: Just to finish up on my questions, to stick with that again, I have always said those comments, by the way. You can check me on the record for the last four or five years saying the same thing, so I am going to say consistently what I believe about it. People may not think it is a reality, but is it the reality. I guess the main part of the question is this: How do you decide what times of the year? Do you look at job facts sheet numbers? When do you decide when and how much you allocate for those types of projects?

MS J.M. AYLWARD: This Job Creation Program is one based on its criteria being very responsive to MHAs and to what they raise for it. For the most part, these issues have been raised very articulately by members of caucus and Members of the House of Assembly generally, based on the needs of the community. Particularly, as you would know, in the winter months and in late fall we find is when people often fall short of being able to access funding and will have to resort to social assistance programs. I think that is the driving force.

We also know that in some areas of the community if we have a better year of fishing or forestry, or if there are other initiatives that need to be, I guess, accelerated, we will try to introduce a program at that point in time, but it is based on short-term work as needed in high unemployment areas. It is really done based on our ability to pay and the needs that have been brought forward by members. There is no formula, there is not time frame, and there is no budget.

MR. SHELLEY: Spring is another time. It is either fall or spring, usually.

MS J.M. AYLWARD: Spring and fall, that is what I am saying. Late winter or early spring and fall is when we often find that we need to do these kinds of things.

MR. SHELLEY: One of the problems you had this year, by the way, and I will finish up with this, is that the federal government - and I won't go any further than to say that it is the federal government - laid a lot of expectations out there about job creation and these projects coming along that really, I guess, caused us all problems.

MS J.M. AYLWARD: You mean our job creation program?

MR. SHELLEY: Yes. Well, not your job creation. I am saying that expectations from the federal government members and the federal government that there would be job creations coming, that never did actually materialize except for a couple of places. It caused a lot of problems out there this year, I can tell you that, even within my own district, because my district is split by two federal members - MPs. It caused a lot of problems this year when there were expectations that there were federal job programs coming, I guess through HRDC and the REDBs and so on.

I am just making this comment here tonight, that I went through it in my own district, trying to settle down people because they were expecting so much. Thank God there was a little bit - and it was only a little bit, as we said, but it is a little bit that helped resolve some problems in a lot of rural communities. I want to just let you know that frustration was there this year, and I dealt with it.

Thank you, Mr. Chairman.

MS J.M. AYLWARD: I think it can work the other way, too, because in the past we have been very successful in levering a large amount of money to make our job creation program even more effective, from monies from the federal government, so it can work both ways. I haven't experienced what you have said, but I have certainly experienced the leverage that we have been able to access with some of the federal money so it certainly can work the other way too.

CHAIR: Mr. Byrne.

MR. J. BYRNE: Thank you, Mr. Chairman.

AN HON. MEMBER: (Inaudible).

MR. J. BYRNE: Don't worry about it.

I have a number of questions with respect to your opening remarks and then I have some more highlighted in the details of the Estimates. With respect to the job creation program, I notice that the Auditor General picked up on that program this year in her report. I have to say, I have to agree with Paul. That program, even in my district which is so close to St. John's, has benefitted a number of people.

For example, one of the projects itself was $10,000 but we levered up to $24,000 on that one $10,000. So it was quite beneficial to the people in the area, especially in the jobs themselves for the people who are in desperate need. That is all I will say on that.

With respect to the federal infrastructure program and the monies that were announced this time around, it is my understanding, from what you said in you opening remarks - because I thought that money that would be made available to the provinces was on a per capita basis - that you are going to be approaching Ottawa, I suppose, to see if you can have that formula changed and get more than what we would get if it was based on a per capita basis.

MS J.M. AYLWARD: That is our plan.

MR. J. BYRNE: That is your plan? What is the likelihood, though?

MS J.M. AYLWARD: The last time we got 2.8 per cent, which is more that we should have gotten. Do you know what I mean, if you are looking at the per capita formula?

MR. J. BYRNE: Yes.

MS J.M. AYLWARD: So our plan is to get, as I said, based on equity as opposed to equal; because we believe that in order to be equal it has to be more equitable in terms of our needs, and our needs are higher than other municipalities that have a greater ability to pay, and some of the what we would call our ‘have provinces' like, Ontario, Alberta, and B.C.

MR. J. BYRNE: Because if we get on a per capita basis this year, the Province is only going to get maybe, what? $2 million?

MS J.M. AYLWARD: We never got per capita before. We did it based on our ability to negotiate the best we could on needs. That is our plan for this year too.

MR. J. BYRNE: With respect to the debt relief and the $5 million that you are putting into that this year, we know the criteria really, and you made a comment that you tried to get the towns to impose tax structures which are more acceptable to the department, I suppose, and what have you.

Out-migration has been a big factor in rural Newfoundland over the past number of years, in particular with the municipalities being able to collect the revenues that you would think they could collect - people leaving, boarding up houses and what have you. I am just trying to say that if it goes too high, wouldn't it be to the point of diminishing returns, if you try to impose it, to bring it up, that people who are there can't pay and they are not going to pay? When do you get to that point?

MS J.M. AYLWARD: By and large you would think that may be the case, but we have seen municipalities that have done absolutely superb jobs in having what we would consider the maximum taxation base and having fabulous collections rates.

I know, for example, there is one mayor on the Straits of Labrador who had only something like $42 owing in taxes, because nobody in their right mind wasn't going to pay the taxes because they knew they would lose their services. She had almost 100 per cent - I say she, not to give it away - she had almost 100 per cent taxation paid. I just use that as one example. We have so many communities that are in arrears because there has never been a really solid attempt to collect outstanding taxes. Even with a lot of seniors in our communities, seniors are some of our best taxpayers because they do have a guaranteed income, they know what they are getting, they are not seasonal and that sort of thing.

I think there is a point of diminishing returns and that is why we have set our taxation rates at what we believe very modest levels for the services we are providing. In some communities it is rather difficult because, for example, there are no sewage services. So they don't get charged sewage tax; they just get a portion of the water and sewage taxes. I think it works out to $241.60 or something like that. There is a ratio that is put in place where you only pay for water if you have it.

It is very hard to put a general rule to say that it is diminishing returns because we have had fabulous success with some municipalities; and others, which have a much larger tax base, have much poorer collections records.

MR. J. BYRNE: Collecting taxes from people who are in arrears is different than if your tax rate is four mils and Department of Municipal Affairs want it to go up to eight mils or ten mils, or whatever the case might be. In those rural municipalities, there is a big difference there. So if you go to eight mils, you may be to the point of diminishing returns, but if you went to six-and-one-half, you could collect it. That all has to be factored in the criteria which would allow that municipality to get money out of that $5 million for the debt relief.

MS J.M. AYLWARD: I think that is an excellent point. Most of the municipalities are very aware of that. That is why we will do a progressive tax increase so that they can achieve it over a period of time to get the money that they are hoping to get for that very same reason. Most of the communities, when they come in to us to ask for their debt relief program, recognize that there is some capacity to increase. Nobody likes to do it.

We have seen, as Paul Shelley pointed out, some fabulous returns from the debt relief program where municipalities have increased their taxes at a level that is considered acceptable, to the point where then they are able to assume more debt to do other infrastructure.

MR. J. BYRNE: Thank you.

With respect to the NMFC -

MS J.M. AYLWARD: Pardon me?

MR. J. BYRNE: With respect to the Newfoundland Municipal Financial Corporation, the department over the past few years have not - I won't say pressured; that is not the word - requested that the municipalities refinance with the private banks and what have you. I want to get a question answered with respect to the debt that comes out of the Newfoundland Municipal Financial Corporation, goes to the private banks, that debt now is coming off the bottom line of the Budget that was brought down the other day. The Province would not have that debt listed then as a debt like they normally would because the towns have gone to the private banks, but ultimately government is responsible. Is that not correct- in the long haul? If the towns happen to go bankrupt, they have the guarantees out there so they are responsible anyway, aren't they?

MS J.M. AYLWARD: I think the purpose of moving out of the NMFC and going to the banks is the interest rates.

MR. J. BYRNE: Is the interest rates, I know.

MS J.M. AYLWARD: As I said, what we have achieved in terms of the $125 million refinancing, any savings that we have achieved we have put back into administration and infrastructure. It hasn't gone to the general treasury, so we try to put it back into the municipalities in that respect. It is a much less debt load for municipalities and, as I said, our target is 30 per cent as you know. What we are finding is that once they have refinanced, a lot of these communities are able to assume more responsibility to do other infrastructure programs which allow them to meet the needs of the people they are serving. It is better to have the money down on your principle than on the interest, obviously, and that is what it allows them to do.

MR. J. BYRNE: I agree.

With respect to the refinancing, you mentioned $125 million refinanced and you reinvested the savings. Can you tell me where that is? Because I didn't see it here. I didn't see any difference in the MOGs or the capital works or anything like that.

MS J.M. AYLWARD: No, but I think when I said we I meant they in respect that the municipalities, once they have that extra money that they are not paying down on debt, they reinvest that into their own municipalities. We don't take the money back and put it into the department or anything.

MR. J. BYRNE: With respect to the new legislation and the councillors - that we had so many just kicked off and what have you there - you are planning on bringing in an amendment, are you not, this sitting to address that concern with respect to being able to be re-elected or run for council in September of 2001?

MS J.M. AYLWARD: They will not be allowed to run in the by-election which, in some cases, are being held over the next number of months, but they will not be unduly penalized. In other words, they will be allowed to run in the 2001 election as opposed to making them wait for five-and-a-half years. That is the amendment.

MR. J. BYRNE: With respect to some changes to the municipal elections legislation that they are talking about bring in for September of 2001, can you give me a few examples of some specific concerns that are going to be addressed in that legislation?

MS J.M. AYLWARD: Well, right now we are in the process of, I guess, talking to the municipalities and doing a similar process as what we did with the Municipalities Act, making sure these are things that are workable and achievable and things that they want to have in the act. One of the things I know they are talking about is a mail-in ballot system. We are willing to discuss that and talk about it and see if it is possible, not like we do now in advance polls but a general mail in. That is something that is being discussed as a possible consultation piece; but, by and large, we are just in the process now of going and out and asking them the sorts of things they are interested in having in this new act and we are doing our best to fulfill a commitment that they will be brought forward to the House of Assembly and they will have gone through public consultations by the time of the next election.

MR. J. BYRNE: Just a bit further to that, this is addressed somewhat in the Municipalities Act itself - and you people would know a lot more than I would because we all have certain councils where we have inherent problems within the councils themselves, with personalities, with conflicts, just with local politics and what have you - is there going to be anything in this legislation to give the Department of Municipal Affairs the authority to basically go in and say: Listen here, this council is not operating basically in the best interests of the people and is at loggerheads all the time.

You are talking about democracy, I know, but is there going to be anything done to address those concerns?

MS J.M. AYLWARD: We have that ability right now and it is in the Municipalities Act. In fact, if you were listening in Witless Bay, for example, the only thing that the council in Witless Bay could agree on is that they should not serve as councilors. They all agreed on that and, as a result, we have sent in right now a member of the Department of Municipal and Provincial Affairs, and we are in the process of appointing an administrator for six months. So we do have the ability to do that but, like anything, there is a process you put in place to achieve it. You just don't go in there and say: Okay, guys, you are all out of here.

What we did was: first, we had a member of the Department of Municipal and Provincial Affairs work very closely with them to see if they could resolve their issues. I guess you could say there were irreconcilable differences in that particular relationship as councilors, so it got to the point where they could not agree on anything except that they should all resign, which they did, unanimously, and that is when we followed the process. So that ability is there.

MR. J. BYRNE: I have a reason for asking that, and I think John would know why I am asking. With respect to the Multi-Year Program, there were a number of larger municipalities that took advantage of that, so I am trying to get a handle on how much money is going to be out of the - I think it is $20 million or $21 million we had for capital works this year -

MS J.M. AYLWARD: Yes, $20 million.

MR. J. BYRNE: Normally that would be going to all the Province, type of thing, so the larger municipalities last year took advantage of the Multi-Year Program and so on. How much money are we going to be able to see for the smaller towns like Torbay or Pouch Cove? Will there be more money made available to those people?

MS J.M. AYLWARD: I guess you are going to have to wait and see, Jack. You were going to ask me how much I'm giving you in capital works this year?

MR. J. BYRNE: No, I am not asking you that.

MS J.M. AYLWARD: I'm sorry, I misunderstood you.

MR. J. BYRNE: You did. What I am asking is this. Out of that $20 million which would have been there for the total Province - the cities, larger municipalities, smaller municipalities - how much of that $20 million will be made available to the smaller towns to take advantage of this? Such as, I said, Torbay or Pouch Cove. It could be CBS. Oh, CBS had it. Whatever. Paradise, they had money too.

MS J.M. AYLWARD: Last year, as you know, we had about 140 projects and we did infrastructure in about one hundred municipalities. The multi-year capital works program last year funded ten municipalities with about twenty-six projects. In terms of how many, we try to treat every single municipality as fairly as we can. I think the record will show that. We have encouraged the bigger municipalities - and I think Ralph spoke to that - to try to access the multi-year, so that frees up more money for us. Could we use more money? We sure could, but we will try to divide it up as best we can and consider the municipalities who can't access the multi-year as a priority, instead of giving it to the bigger municipalities.

CHAIR: Jack, we are just going to move on because we are trying to give everybody an equal chance. We will come back to you.

MR. J. BYRNE: No sweat.

CHAIR: Mr. Hodder, sir.

MR. H. HODDER: Thank you very much.

I wanted to ask a question on the preparation for the new Elections Act. Will we be ready at that time to use the common list of electors used by the federal, the Province and the municipalities?

MS J.M. AYLWARD: Maybe I will ask John, who is working on it, to answer that.

MR. MOORE: Yes, Harvey, that would be our intention, to hopefully be able to include the authority to use that at the same time.

There are several aspects to this municipal legislation. The minister touched on a couple of points there in answer to Mr. Byrne's question. One of the big reasons for doing it, of course, is that there are four statutes in the Province at the moment governing municipal elections. All of them contain certain provisions that are different. There is a different process in St. John's than there is in Mount Pearl, and so on and so forth. So there is a need to consolidate and modernize, because most of our municipal election legislation has not been overhauled in any comprehensive way for years. The minister alluded to the mail-in ballot system, which is something that has been tried in a number of other provinces on a municipal basis. It has been highly successful in encouraging much greater voter participation in those elections, and at much reduced costs, which is always a factor. Those are the types of things (inaudible). With the federal list of electors, we are hopeful, in discussions we have had with the Chief Electoral Office here. Staff from that office will be involved in our review and legislative process. So hopefully there won't be a problem with doing that.

MR. H. HODDER: Thank you, John.

Will that new legislation address issues, for example, like the right of a member who narrowly loses an election? Let's say, for example, that the mayor of St. John's, where the defeated candidate felt that a count of the votes, for the second time, was necessary and there were provisions whereby - I think quite unfairly - that there were circumstances there which I think warranted a recount. As you know, there was an attempt to make the individual candidate pay for that recount, which I think was quite unfair and has been very rarely used in either St. John's or anywhere else. Will that issue be addressed, that there will be some consistency?

MS J.M. AYLWARD: Harvey, that will be discussed. How it will be addressed I guess remains to be seen. Because when we do the consultation process any number of issues that are raised as potential issues will be discussed, but in terms of will it be addressed in its resolution in way you have identified is really too soon to say at this time. Because we will consulting with the municipalities, and as you know, on that issue there was certainly mixed views. I think the consultation process will give us a lot more specific answers to some of those types of questions.

MR. H. HODDER: Thank you. I just wanted to make one other comment on the election process, to say that I concur with your handling of the recent issue relative to the mayors and councilors who did find themselves in a rather serious situation. As you know and I know - well, you might not know this - but I was part of the federation that sought to have that kind of provision put in, and it first appeared I think in the 1979 legislation.

MS J.M. AYLWARD: It was twenty-five years old where this piece of -

MR. H. HODDER: Of course, it was the responsibility of the municipality.

MS J.M. AYLWARD: Right. It had to be brought forward by resolution.

MR. H. HODDER: These people will not have to go through a five year time and I think that is appropriate. However, the message has been communicated very clearly that if you want to sit in judgment on others, then you have to at least have your taxes paid and be able to do that from a credibility point of view. I know there are some people out there for whom this was a very difficult issue. In some cases, I believe, clerks could have done a better job in long term situations but I do not want to blame the clerks, because each individual elected person is ultimately responsible for how they take responsibility to pay their taxes and that kind of thing.

MS J.M. AYLWARD: We are not anticipating a large number of councilors to be in arrears next December 31.

MR. H. HODDER: Yes. I wanted to make mention of the payroll tax. As we know, the exemption level is up to $400,000 which is good. Of course, as you know the government and the Opposition agree on one thing, and that is that we would like to see the payroll tax eliminated altogether. How many municipalities will now be still eligible to pay the payroll tax and how much money will that accrue to the Province?

MS J.M. AYLWARD: I think it will certainly only apply to our larger municipalities, and I would have ask Ramona if she has any analysis done on that yet. Because for us it is a fairly new piece to the puzzle. Maybe the Department of Finance would have a much better idea on that because they have actually calculated the benefit right across all sectors and I would not be able to answer that one specifically. I do not know, Ramona, if you would have that information.

MR. H. HODDER: A further follow-up tax to that, because one (inaudible) is this would have to be a tax, of course; one level of government is in essence taxing another level of government.

MS J.M. AYLWARD: Only in so far as it is going back to the municipality in this case.

MR. H. HODDER: I know there are some ways in which this money does return, but I have certain difficulties with the way in which the Province, for example, assesses taxation to the various municipalities. So there is a real issue, and the Federation has talked about this as you know, not just for the payroll tax but it also applies to other taxes as well. I was wondering if there is any discussion on the way of trying to address the issue of the Province taxing municipalities for the HST, payroll tax and other sundry taxes that might be there.

MS J.M. AYLWARD: I know the municipalities have an interest in it but I think they would be discussions, for the most part, that they would have had with my colleague in the Department of Finance. Because as you know, the tax base and the adjustments are done through the Department of Finance so I would not, again, be able to answer specifically that question because I really do not know what kind of discussions they have had with the Minister of Finance.

MR. H. HODDER: The municipalities for a long time have been seeking to have some representation on the Newfoundland Municipal Financing Corporation, direct representation on the board of directors. Has there been any consideration given to that? They feel, as a consumer organization, that they would like to have some seat on the board of directors. Is that actively under consideration?

MS J.M. AYLWARD: On the seat on the board of directors of which organization?

MR. H. HODDER: Of the Newfoundland Municipal Financing Corporation.

MS J.M. AYLWARD: I know it has been an issue for them. As far as I know, there is no intention at this point to go in that direction again. That is maintained under the Department of Finance, and I do have a meeting with my colleague for the Department of Finance to discuss a number of issues around NMFC. I know that is certainly one of the things that municipalities have advocated for. As far as I know at this point in time, there is not an intention to do that, although it will be discussed with them.

MR. H. HODDER: I would make the point that some of the larger banks and some other financing agencies are now having consumer representatives on their board of directors. It would make some sense where you have an organization that is exclusively dealing with municipalities to have some representation on the board of directors from the consumer organization, namely, I guess, from the Federation itself. The Federation would have to decide who would sit there if, for example, we were to run the Corporation consistent with what is the practice for other large free enterprise, independent, free or private, corporations like, for example, some of the banks. I think the Federation does have a legitimate viewpoint in seeking to have direct representation on that board of directors.

The other issue I wanted to mention very briefly would be the issue here of grants in lieu. As you know, the federal government has always paid grants in lieu. Recently they have a new agreement with the municipalities. The Province has not carried itself in the same way. For example, if you look at the value of the infrastructure, or the value of the buildings you might find in some municipalities, particularly in St. John's, there is always a contentious argument, that the buildings owned by the government in St. John's aren't assessed for market value, so therefore the Province doesn't pay its fair share of taxes to the municipality that they should. Is there any movement underway to bring some rationalization to that? We know there has been an argument from time to time particularly with the larger municipalities, and more directly with St. John's.

MS J.M. AYLWARD: Harvey I am delighted to hear you ask that question on behalf of St. John's, I think that is wonderful.

MR. H. HODDER: I have 344 constituents in St. John's.

MS J.M. AYLWARD: I know that. However, one does not see you as -

MR. H. HODDER: A great majority of them voted for me.

MS J.M. AYLWARD: - the member for St. John's for some reason.

Actually, there are some mixed views on that whole question as you know. If you look at other municipalities across the country, it is really hard to compare apples with oranges, because as you know, we are one of the few governments that provides policing as part of our contribution to the city, and not only to the city but to the outlying areas of the city and other cities. That is one piece of it, and the other argument of course too is that municipal operating grants have to count for something as well.

The third part to your answer is yes, we are still looking at it. As you know, we have given a commitment to look at grants in lieu among other things, and even to begin some discussions on our whole financial allocation for municipalities and how we are doing that, the basis of doing it. So we are looking at a number of initiatives, including grants in lieu.

MR. H. HODDER: If I could switch, Mr. Chairman -

CHAIR: (Inaudible) a chance to (inaudible).

MR. H. HODDER: Fine, we have until 10:00 p.m.

MR. ANDERSEN: (Inaudible) you and your department, I skipped the first round to hear what you (inaudible), but certainly the initiative of the large amount of money for Northern Labrador, that the people in the riding are certainly overjoyed. A lot of people say that it is long overdue, but at least it took the government of today to recognize it and put in place a plan.

Minister, I want to compliment some of your staff who are here tonight who have worked with me over the years with regard to housing. In the past, under limited funds, we tried to help as many people as possible, but certainly it is a great initiative for the people on the Coast and it certainly gives them a sense of hope and belonging. Probably the best example was a lady who was confined to a wheelchair. Your deputy probably knows better than anyone else that the roads were so bad in Nain that it was a known fact that on a nice warm day it was almost impossible - after being in the house all winter - to take her out in her wheelchair, to take her over the road. Certainly the people up my riding are overjoyed and are looking forward to it.

The other thing is the job creation and what it does in small communities. The town hall in Hopedale was condemned by the inspector two years ago. With a bit of money from the council and with job creation we took down the old hall and rebuilt it. The hall now today is in use seven days a week, and when I say seven days a week, I mean it serves as a centre for young people. When different groups are not holding conventions or meetings, every night it is a place where they have table tennis and some more games. It is a place where youth can go and they have a place that they call their own.

With regard to the job creation part itself, sometimes in small communities you run into certain circumstances, and one is that people have to get their hours in at a certain time. If they do not have their hours in by a certain date then they have to re-qualify all over. Once they miss a year, if they do not qualify within the year, that means most of them have to go back to 920 hours instead of the 480, and in small communities 920 hours relates into about six months of steady work. Probably, from my perspective, a drawback to the job creation is that sometimes we are not able to respond in time. For example, if someone needs their hours by September 15, if they don't get them then they have to go back through the whole system. Certainly that is not to condemn the Job Creation Program, but it is just a point that might be taken into consideration. I'm sure that some of the members from rural Newfoundland and Labrador feel the same way. Again, minister, with regard to the Budget I can only say that there are a lot of happy people up in Northern Labrador.

MS J.M. AYLWARD: Thank you, and I would like to offer all of you the invitation to send any of your comments to the Auditor General on the Job Creation Program. Please feel free to do that.

CHAIR: Mr. Wiseman.

MR. WISEMAN: Mr. Chairman, since the vice-chair has indicated that he would like to go until 10:00 p.m., I suggest that we take a break at midpoint.

CHAIR: Let's just continue on.

MS J.M. AYLWARD: We can go again tomorrow night if you want.

MR. WISEMAN: No comment, Mr. Chairman. I will pass to my Tory colleagues.

CHAIR: No comment. Mr. Lush?

MS J.M. AYLWARD: Sir, are we breaking for a point of privilege or some...?

CHAIR: No.

MS J.M. AYLWARD: No? Okay.

CHAIR: Mr. Shelley.

MR. SHELLEY: I have just a couple of quick ones on the Estimates. Under 2.2.01, Policy and Planning, there is a new salary there. I guess it is a $50,000 salary, approximately.

MS J.M. AYLWARD: Just let me come to it first here now and then I will answer.

MR. SHELLEY: Page 236, 2.2.01.

MS J.M. AYLWARD: Yes. Actually, we do have a new salary. We have transferred a policy analyst from Newfoundland and Labrador Housing Corporation over to the department.

MR. SHELLEY: Into Policy and Planning?

MS J.M. AYLWARD: Yes.

MR. SHELLEY: That is just one salary, is it, approximately $50,000?

MS J.M. AYLWARD: Yes, and our 2 per cent is also added in there for our salary increases. You will see that right across all sectors.

MR. SHELLEY: This person was moved from Housing into Policy and Planning. I am sure there is a lot of work to do in Policy and Planning but there is a lot of work in Housing too. Why would -

MS J.M. AYLWARD: If you consider what we have taken on this year - that is Baxter's shop right here - if you consider the municipalities act that he has been working very closely with John on, if you look at the new elections act that we are in the process of doing, if you look at the regionalization issue that Tom has raised, that was why we made the decision. It doesn't preclude anyone from working on Housing issues but the money came with the job. They are still able to perform functions of Newfoundland and Labrador Housing, but primarily they are working out of the Department of Municipal and Provincial Affairs.

MR. SHELLEY: In 2.3.01 there is another salary.

MS J.M. AYLWARD: 2.3.01

MR. SHELLEY: Just on the next page. Under Administration and Planning there is another salary of approximately $43,000.

MS J.M. AYLWARD: There is a new salary put in this section but it has been reallocated from within the department to cover off the salary of a computer support specialist hired to work in our new infrastructure management system. We have been trying to do the computerized management infrastructure program. So while it is a new salary for this particular area it is one that has been reallocated from within the department.

MR. SHELLEY: I guess that will answer the question to what happened in the same section, 2.3.01.05, under Professional Services. You went from $23,000 budgeted to $100,100. I assume then that Professional Services might have something to do with computers.

MS J.M. AYLWARD: What happened here was that we had a number of specific issues, I guess, that you can relate to, around the THM issue particularly. The other issue, of course, was the Waterford Valley trunk sewer system. That was another initiative that cost a significant amount of money. Then there was the rockslide in Upper Island Cove. All those are pieces that come under that Professional Services section.

MR. SHELLEY: Okay. I felt obligated at least to ask some questions directly to the Estimates, but that is all I have to (inaudible).

MS J.M. AYLWARD: No, that's fine. When you look, it is a significant amount of money but you can see that the budget for this year is back to the same $23,000 -

MR. SHELLEY: The same amount, I know, overall.

MS J.M. AYLWARD: - and that is because you cannot predict a lot of these instances in the municipalities piece.

MR. SHELLEY: Thank you, Mr. Chairman.

CHAIR: Okay, Mr. Shelley.

Mr. Byrne.

MR. J. BYRNE: Thank you, Mr. Chairman.

I will just continue on. I want to continue on with something that Wally was on to and that is the $23 million for Labrador.

MS J.M. AYLWARD: Yes.

MR. J. BYRNE: Which I agree is probably long overdue and what have you. I am just curious as to how those numbers were obtained. The Premier went to Labrador, he came back, and the next thing you know, in the Budget we had $23 million. It seemed to me this would be a quick time to put together that kind of detail. How did you arrive at those figures?

MS J.M. AYLWARD: I think the best way to say it is that the Member for Torngat Mountains has been advocating very strongly on behalf of his constituents for a long time. I think he has done an excellent job in bringing to the fore the issues around housing, water and sewage and roads and the like. The reason the Premier went was around a whole different issue, but as you know, all of these issues are very integrated in trying to help the Member for Torngat Mountains resolve some of the issues in his district. I would say this is a culmination of some very strong advocating on behalf of the Member for Torngat Mountains.

MR. J. BYRNE: Very good. Thank you.

This is a question -

MR. ANDERSEN: Point of order, Mr. Chairman.

CHAIR: The hon. the Member for Torngat Mountains on a point of order.

MR. ANDERSEN: Further to your response, it was myself and members of the Department of Municipal and Provincial Affairs who got money from the department, and along with a group of people in Nain we did a housing survey. We went through the entire community, as well as Hopedale. I'm sure, as the minister said, that this was ongoing for quite some time prior to our trip to Nain. We went there to listen to the concerns of the people and that is exactly what we did. It was ongoing with a number of departments over the years.

MS J.M. AYLWARD: I think for further clarification, too, the Deputy would like to just add to that.

MR. NOSEWORTHY: As Mr. Andersen pointed out, he has been advocating, particularly in housing, water and sewer and roads for quite some period of time. The housing figure is actually a measure figure based on need. It is a shortfall that we feel is needed over the next three years to meet both the existing need that is there and the need that will be generated over the next three to five years. So that is a measured figure.

On the roads piece, the $6 million is again an engineering estimate based on the upgrading of local roads in the five communities. The water and sewer is a figure that will complete the water and sewer needs in the five communities as well. So they all come from fairly sound technical data.

MR. J. BYRNE: Thank you.

Just to be clear, I am not questioning if they should or should not get the money. All I am asking is where did you come up with that figure in what appeared to be in a short period of time, but obviously it wasn't. Fine.

Now my next question really is for the Deputy Minister. I can address it to the minister and she can readdress it or whatever. That is an issue that Mr. Lush was on to, and that is with respect to regionalization, amalgamation or whatever the case may be.

In my district, we have talked about a study that was going to be done for cost-sharing a service between five towns two and a half years ago. I have been on to that now for some time. It was no easy task to get the towns to agree to do it. Back in I think it was October we had a meeting with Torbay and whatever, with their department and the Deputy Minister, and it was going to be happening within weeks. I would just like to know what is the status on that? I mean, is it ever going to happen?

MR. NOSEWORTHY: I take full responsibility for that. My apologies, Mr. Byrne, for the time it has taken actually to address this issue. It is not only the area of Torbay and a number of communities in that area; there are a couple of other areas in the Province as well.

You may recall that a couple of years ago the Province, I think, put a lot of effort into a regionalization study. At that point in time there was a task force set. We studied the issue extensively. I think the decision at that stage was really that we, as a department, would only pursue amalgamation or regional initiatives or sharing of cost on the basis of voluntary participation by municipalities. That sort of effort, I suppose, got stalled. There is no question about it. As the minister pointed out, we have been looking at and introducing a new Municipalities Act, a new Urban and Rural Planning Act. Quite frankly, the reason that we are transferring a policy analyst over from the Newfoundland and Labrador Housing Corporation is to advance some of these initiatives in a more aggressive way, including that one. I am delighted to say that I do have -

MR. J. BYRNE: Weren't expecting it, were we?

MR. NOSEWORTHY: I do have a document here which outlines an approach to a regional sharing of services and I would suggest to you that we will be in a position to sit down very early in the New Year with the town of Torbay and others throughout the Province to discuss this very issue. Again, my apologies, Sir.

MR. J. BYRNE: Thank you. There is no need to apologize. I would just like to know the status.

I have a couple of other questions and I will be probably be clued up, if I can have the time.

CHAIR: Go ahead.

MR. J. BYRNE: With respect to page 235, section 2.l.02., Municipal Assessment Services, you can see in that section there was $500,000 budgeted last year, $500,000 spent, and no money budgeted this year. I know why. It was because of the privatization of the assessment division, and that money was over a number of years to help alleviate the starting out problems and what have you. My question is this, and I brought it up before: Now that the $500,000 is not going to be there for that group, won't that impact upon the assessment rates that will be charged to the municipalities?

MS J.M. AYLWARD: (Inaudible) that we have been told, and from what we are seeing so far in the first two years of declining grants, is that the fee-for-service model is working. They are right now quite viable in what they are doing, and we anticipate that will continue.

MR. J. BYRNE: That is working now with that $500,000 over the past three years, I think, or was it four?

WITNESS: Three.

MR. J. BYRNE: For three years they were getting $500,000 from the Department of Municipal Affairs. That money will not be there now. My concern again is that when that revenue is not there, it will passed on to the municipalities.

MS J.M. AYLWARD: Do you want to jump in there?

MR. NOSEWORTHY: I happen to be Chair of the Municipal Assessment Agency as well.

MR. J. BYRNE: I hope you are getting paid well.

MR. NOSEWORTHY: The fee-for-service, indeed, when the government announced the withdrawal of the subsidy, there was a fee-for-service that increased for some municipalities and decreased for others, quite frankly. It was established at a stable rate of $22.50. That has been in effect for the last year or so, and certainly I think there have been some cost-cutting measures evoked by the Municipal Assessment Agency. Indeed, I think the division at one point in time within the department was some eighty-odd employees. There are currently fifty-six, and it is our estimate right now, based on revenues and expenses, that we can certainly deliver the service with no reduction in service at the rate of $22.50 for the foreseeable future.

MR. J. BYRNE: Thank you.

Something that the new minister does not know anything about, I don't think so, and it is with respect to volunteer fire departments. I have a note here that it is time to treat them fairly and equally, and that is this - and the deputy minister and Ramona and everyone else will know what I am talking about. The Town of Logy Bay-Middle Cove-Outer Cove, a couple of years ago, started a volunteer fire department; $500,000 from a community of 2,000 people, and they were forced into it by the City of St. John's and the actions of the Department of Municipal Affairs with respect to the regional fire department being forced into that. There was not one red penny from the Department of Municipal Affairs for fire trucks, for equipment, for a building, for nothing. I have had a problem with it from day one.

The Town of Logy Bay-Middle Cove-Outer Cove were quite fair and reasonable in what they were putting forward to St. John's and to the regional fire department; and the former minister, Reid, got his back up and told them that if they were heading their own volunteer fire department they were getting no support from government. It is the only volunteer fire department within this Province that has gotten no support and are getting no support from Municipal Affairs. I am just letting you know that I will be requesting a meeting with you to discuss this issue because it is an example of unfairness within this Administration.

I don't expect you to address that now because I don't think you would be up on the details of what actually went on. I can go on for half-an-hour or an hour on that issue alone. I just wanted to make you aware of that. I don't know if the deputy minister wants to respond or not.

MS J.M. AYLWARD: I can just say that my understanding is that the fire services were supposedly being able to be provided from St. John's and that was the basis of the no allocation of funding. I think you are more aware of that than I am. In terms of setting up a meeting, you are welcome to join the other 290 municipalities and come on in.

MR. J. BYRNE: A quick response to that comment. I think I should make it here because it will be on the record. The services could be provided by the City of St. John's. There was a regional fire department put in place. There were five or six municipalities involved in that. Now it is basically St. John's and Mt. Pearl, I think, and is CBS still in, or Paradise?

WITNESS: Paradise.

MR. J. BYRNE: Paradise. At the time when that was being put forward, the Town of Logy Bay-Middle Cove-Outer Cove went to the city and offered them a negotiator - what do you call it? - a person would be appointed, and whatever that person said they would agree with. If they asked for $150,000 or $40,000 or whatever the case, they would agree to pay it. They offered them a base rate plus a call-out rate, but the mayor at the time said: No, certainly not. There were offers made back and forth, but they were put in a situation where they had no choice because of the rates that were charged to them from the city. Anyway, we will discuss it.

On page 239, section 3.2.02., Canada-Newfoundland Infrastructure Program, you had budgeted under 10., Grants and Subsidies, $618,900 and you only spent $152,100. I was just curious as to why that would be.

MS J.M. AYLWARD: Just say that again. We budgeted $618,900.

MR. J. BYRNE: You budgeted $618,900 and you only spent $152,100.

MS J.M. AYLWARD: I think that is a carry-over, if I understand correctly. Basically, the expenditures were lower in 1999-2000 because more of the funds were spent in the previous year. Do you understand what I am saying?

MR. J. BYRNE: No.

MS J.M. AYLWARD: Ramona will explain it further. Basically, the reason it is lower is because more money was spent in the previous year.

MS COLE: When the Budget was prepared for 1999-2000, it was expected that they were going to be carry-overs into 1999-2000 from the previous year, totaling about $618,000; but we actually got more of them done prior to the end of the year.

MS J.M. AYLWARD: It was very efficiently spent so there was less to carry over.

MR. J. BYRNE: We are going to do Newfoundland and Labrador Housing later, are we?

MS J.M. AYLWARD: Yes, whenever you are ready.

CHAIR: Mr. Hodder.

MR. H. HODDER: I have two questions.

CHAIR: Two questions.

MR. H. HODDER: I could have more.

I wanted to get back to the urban and rural planning. In the Estimates, on page 236, I want to make a point. You mentioned in your comments that you are doing a new Urban and Rural Planning Act. From my introductory years in municipal government, we had some real difficulties in Newfoundland and Labrador with planning. In fact there was a real focus in the early seventies to try to get planning as a priority for municipalities. In fact, Mount Pearl was the first municipality in Newfoundland and Labrador to have a municipal plan, and that was done in 1958. It was done before my time and I can take no credit for it whatsoever, but I did have a role in carrying on that tradition.

I have grave concerns that as we approach more autonomy, moving it towards the municipal level - as you know, there has to be a relationship between provincial planning for highways and all these other services and municipal planning - are we going to run into a problem where our planning and our actual services are going to be worse in twenty years? Are we going backwards with this initiative is my basic question?

MS J.M. AYLWARD: My view is that we are definitely going forward for a number of reasons, acknowledging the greater autonomy and allowing them to approve their own planning. Because you can imagine how frustrating it must be to have your own municipal plan and not being able to approve any of the planning policies.

Through consolidation of expropriation provisions and through the public consultation piece, which is a key part of the development of the planning strategies, I think that if you consult publicly on the planning strategies and also the development regulations I don't think you will see the mishmash that you are referring to, or going backwards. I think, in fact, it should be the opposite. It should actually reduce the red tape and allow municipalities to move a lot more quickly once they have gone through their consultation piece than they are able to do right now. I would expect it would be the opposite. In fact, they must be quite frustrated sometimes waiting for the clearing of the red tape that is just a normal part of the process.

MR. H. HODDER: There is no doubt that the red tape - having to have dual public hearings and all that kind of thing - needs to be streamlined. However, for example, Saskatchewan, when they moved in a direction like this many years ago, they came out with a policy that said that any municipality that had, I think it was over 15,000 people, had to have a professional planner on staff. Their plans had to be done with professional planners. They served the interest of autonomy, but brought in strict regulations that made it work.

Do you have any intentions to continue the priority that we developed in the 1970s and the early 1980s on planning so that we don't diminish planning? Because I have noticed that some municipalities have in fact dismissed their planners, and there seems to be a tendency towards de-emphasizing planning at the municipal level. I have concerns with that. I want to know if we are going to have some safeguards here.

MS J.M. AYLWARD: I do not know if you perhaps did not hear my previous answer, but one of the things we are planning on putting there as a safeguard is the regulations to safeguard against, I guess, poor judgments and to control as best as you can how municipalities will make their decisions and make their planning policies based on those kinds of regulations. So while we want to give them greater autonomy, I think there is certainly no intention to allow them to go and do plans in unacceptable ways or ways that would never meet regulations set down by the provincial government.

I think the clear intent is this. Some of the things that I know we deal with are of such a routine nature that it is nothing but a slowing down of the process and a very frustrating part in terms of major decision making and policy. I think the whole idea of government putting a regulation in place is for exactly the reasons that you have identified.

MR. H. HODDER: We are ready to call the heads. I think you have to do the Housing.

CHAIR: (Inaudible).

MR. H. HODDER: No, there is a separate head for Housing.

On motion, subheads 1.1.01 through 4.2.01, carried.

On motion, Department of Municipal and Provincial Affairs, total heads, carried.

CHAIR: Are we going into Housing or do you want to have a break?

MS J.M. AYLWARD: I am going to have a break, please. May as well make a night of it, hey?

CHAIR: We will come back for 9:05 p.m. in fifteen minutes.

MS J.M. AYLWARD: Five minutes after ten is even better; whatever you want.

CHAIR: We will return at 9:05 p.m.

MS J.M. AYLWARD: That is great.

CHAIR: Order, please!

We are going to resume the hearings now.

The hon. the Minister of Municipal and Provincial Affairs.

MS J.M. AYLWARD: Thank you very much.

I am very pleased as well to have a few comments on the Newfoundland and Labrador Housing Corporation, a corporation I'm very interested in personally. I think it is doing very fine work on behalf of the people of the Province. It is a provincial Crown corporation which operates under its own piece of legislation, the act respecting Newfoundland and Labrador Housing Corporation. The Corporation reports to a government appointed board of directors and its financial activities are reviewed by the Province's Auditor General. The audited statements are published in the Corporation's annual report which is submitted to the Lieutenant Governor in Council and tabled here in the Legislature.

The Estimates document reflects, as you can see, an allocation of $6.4 million for this coming fiscal year which represents the Province's grant towards the Corporation's $100 million current account expenditures. As you will also note, this represents an increase of $4.4 million over last year's allocation of $2 million. The net increase provides for the reinstatement of the grant which was reduced last year when Treasury Board required the Corporation to refund the $4 million of provincial investment in public housing. For the coming year the Province has returned to funding all Newfoundland and Labrador Housing operating expenditure with a grant. The remainder of the increase covers the negotiated wage increases of $400,000.

The past year has been a transition year for the Newfoundland and Labrador Housing Corporation. In 1998 government directed the Corporation to accelerate its withdrawal from residential and industrial development, as well as sundry property management activities, and also to become an agency whose sole responsibility is the provision of housing programs and support services to low-income Newfoundlanders and Labradorians. We are very proud to say that 98 per cent of our planned expenditures are allocated to the provision of social housing and support services, so there is clearly a focus on social housing as evidenced by a 98 per cent focus on social housing.

I would be happy to answer any questions and talk a little bit about our housing initiatives. Obviously some of the more important ones would be our Provincial Home Repair Program which we have an allocation of $10.2 million for this year. We are also pleased again, and I will say it because I think it is important enough to mention, that we have $7.7 million going towards our North Coastal Labrador strategic initiative under the Housing Corporation. As well, as I have pointed out, our main focus of the Newfoundland and Labrador Housing Corporation is social housing units. So, Mr. Chairman, I'm certainly open to any questions.

Thank you very much.

CHAIR: Thank you very much.

Mr. Hodder.

MR. H. HODDER: I have just a couple of questions. One is on the issue of determining the eligibility people have for emergency assistance. We all have circumstances and we all can tell stories, but there appears to be a severe tightening of the criteria. For example, we all run into situations, sometimes with seniors, sometimes it is with people who are on social assistance, who have real genuine problems. They have leaking roofs, they have windows that the wind blows in one side and comes out through the other, that kind of thing. I'm wondering if there is any review of the criteria that you might have for what we call emergency need when it comes to rehabilitation in the housing area.

MS J.M. AYLWARD: Thank you very much for the question.

In fact, our Provincial Home Repair Program is currently under review and we are looking at merging, I guess, the urgent repair and the provincial repair into one. Looking more at a critical repair program. Because you are right, what we are trying to do is address issues based on need and we obviously do have some very significant needs in our social housing sector. So we are in the process of trying to merge the programs into one new one so that we would look at new criteria where we would basically look at the critical housing repair needs of people in social housing. It is something that is being developed really, I think, in a very good way.

I have just been recently meeting with all of the Housing staff, both the front line staff and the management staff, as well as senior executive, and we have involved all levels to this point in time in trying to develop this new critical repair program. Because I think the people that have to deal in the most difficult situations are our front line staff, who also have to make those kinds of determinations. While we do have criteria there, it is a very difficult situation. So we are in the process of reviewing that to try to merge both of them into a new program where we can look at the critical needs, and certainly by involving our front line staff we will be able to adjust the criteria to meet the needs that they have pointed out to us.

MR. H. HODDER: When you have developed the criteria, will that criteria be communicated to the public and will it be shared with the MHAs, so that when we get our various calls we are able to have some idea as to what the criteria are so we do not end up, sometimes, waiting weeks? Will there be some sharing of the criteria? This will be helpful, I'm sure, to the public, and also help to all of us as MHAs.

MS J.M. AYLWARD: Absolutely. The first think we would want to do would be to pilot test the new criteria and that is something that we have actually discussed with some of the staff, how we would do that. We would also have to look at the current lists and how they are impacted. There is very important logistical type of question about: What do you do with the current list? Do you start a new list? Do you merge the two lists? Some of the lists are long enough that they would not even be applicable any more under a new program. There are all sorts of pieces to it, but one of the pieces we are very confident in is that when we do move towards the new system, after it is piloted, that we would educate and train all of our staff. Obviously, because our MHAs are advocates in many cases, and in other cases sole advocates on behalf of their constituents, they would be a very integral part of knowing the new process and the new criteria. That is a definite yes on that one.

MR. H. HODDER: My final question is this. When we have issues, for example, when there are approvals given to individuals to repair their homes and monies have been allocated, there seems to be all too often a disagreement between the contractor that is doing the work and the individual. We often end up finding ourselves where there are disputes and of course, in some cases, particularly when it comes to seniors - and I have a lot of seniors in my district - they find out that there seems to be nobody supervising. Is the work that is paid for actually being done? They have no family advocate. They have nobody who can say: Yes, this is what was paid for and this is what you have. So you have eighty year old ladies who find themselves having paid out $20,000 or $15,000. Supposedly the work that was done was up to standard. Nobody really inspects it and nobody is saying: Yes, here are the specifications and here is what we have done.

Is there any way in which we can have better inspections carried out? Because it is one (inaudible) thing to say that the individual is responsible, but when you have an eighty-eight year old lady who says: I assumed that everything was done like it was supposed to be done, is there any way in which we can have some way, through the community or somewhere, whereby somebody is going to guarantee that the work that was paid for is actually completed in the manner that it was supposed to be?

MS J.M. AYLWARD: Thank you for the question. I think there are two pieces to that. Our inspectors do help individual cases, time to time. The other piece is that the money is not allocated until all the work is done. That is the other very important piece to it. Even though an amount of money has been allocated for the work, the money is not actually given out until the work is done. I think that is the point where you say the advocate can come in there, whether it is the inspector or some other person within Newfoundland and Labrador Housing or, often in cases, the MHA to advocate for them; because I know, I have been in a situation myself where I have been asked to intervene.

MR. H. HODDER: You would agree, then, that in some circumstances we need to find a way to give some of our seniors the comfort of knowing that the work that was paid for is actually completed in an acceptable standard?

MS J.M. AYLWARD: Well I think, in fairness, I would not want to raise the expectation that we are going to be out inspecting all the $10.2 million we have allocated for the Provincial Home Repair Program. I think it is fair to say that most of the clients that we have helped - and we have helped a significant number through grants, upgrades and repairs - are able to advocate on their own behalf. I think, as I have said, we do have inspectors who will help in individual circumstances in advocating in that regard but for the most part people will not get the money until the work is done.

MR. H. HODDER: In one instance that I know about, and several others too, the municipality, through its engineering department, willingly accepted the role of making sure they gave the permit but then they accepted the role of assuring that the work that was done was indeed (a) up to standard; and, (b) it was indeed what was tendered to be done. Have you had any consultation with municipalities in getting their help to make sure that the work that was paid for is actually completed?

MS J.M. AYLWARD: I think our approach has generally been: where we can partner, we will partner -

MR. H. HODDER: Yes.

MS J.M. AYLWARD: - but for me to go and ask municipalities to supervise would put a whole different level of responsibility. I think you raised a very important point, that some municipalities have taken it upon themselves. I think Mount Pearl is one in particular -

MR. H. HODDER: It is in their best interest.

MS J.M. AYLWARD: Exactly, because they have a higher level of housing standard and that sort of thing. It would not be something that I would ask municipalities to do but I would certainly encourage MHAs and regional councils and others to try to get their municipalities to do that in a volunteer capacity for their own benefit as well as for the whole issue around community development, advocacy and support. I think that is an excellent -

MR. H. HODDER: I just say to you in closing that I think it is something that could be pursued. It is an area that I think could make the program more effective. Also, I believe that the municipalities might be welcoming of that particular role because they too want to make sure that their seniors or those who have needs are adequately protected, and that the system works right. In my experience, I have had it where they weren't involved and had it where they were involved. Having the municipality involved really, really is the way to go if we can work it out with them in an agreeable manner.

Thank you very much, Madam Minister.

CHAIR: Mr. Byrne.

MR. J. BYRNE: Thank you.

I have a few questions. A short time ago there was a bit of controversy with respect to the use of cameras at Newfoundland and Labrador Housing. I don't know the proper terminology to use, but apparently the people who were being filmed were quite concerned, or the employees and what have you. Are those tactics going to continue? The people who were on the film at the time were quite concerned with respect to that film being destroyed. What is the response to that?

MS J.M. AYLWARD: As you know, right now that case is before arbitration and it will be dealt with in that proper medium. I have met with all of the staff in this particular area, outside staff and inside staff, and have assured them that was an individual isolated case. It was a measure that was implemented after a number of other measures were implemented, and it is an isolated case.

In terms of the film, I think right now nothing would be decided because right now it is part of the evidence that would be used under the arbitration process. In terms of any other related discipline, that would be done through the obvious grievance and arbitration process, which is where it is right now; but I don't think anybody in the Newfoundland and Labrador Housing Corporation would believe that they are being surveyed by cameras or otherwise, unless somebody else has mentioned it to them, because I have spoken to all of them face to face, who have attended four separate meetings and have spoken about the issue at each of those sessions.

MR. J. BYRNE: You are saying it won't happen again, the use of cameras for surveillance of employees?

MS J.M. AYLWARD: What I said is, it is not happening right now. It was an isolated incident, and it is not the intention to survey people. I also said that it was done as a progressive measure of discipline, that it was not an isolated case. I mean, it is an isolated case but the point I am making is that it was done after a number of other measures were implemented.

MR. J. BYRNE: What you are saying, then, is that if a similar situation arose and after a number of measures were used, you would use surveillance cameras again?

MS J.M. AYLWARD: No, that is not what I am saying.

MR. J. BYRNE: You are not saying it won't happen.

MS J.M. AYLWARD: What I am saying is that this was an isolated case and that there is no surveillance occurring, that employees are not being surveyed on the job. I am not going to say any more than you are going to say of what is going to happen in the future. You can't say it any more than I can say it. There is no intent to survey; people are not being surveyed. This was an isolated case, and I guess that is as much as you can say.

MR. J. BYRNE: You could say it won't be a policy that would happen again.

MS J.M. AYLWARD: It is not a policy now. I can't say it won't be a policy in the future. It isn't a policy now.

MR. J. BYRNE: It happened.

MS J.M. AYLWARD: But it is not a policy.

MR. J. BYRNE: With respect to - a continuation of that I suppose - the building on Blackmarsh Road, when they moved into that building, I brought it up in the House of Assembly with respect to the cost involved in renovations and whatever went on up there. About a few weeks ago I took a drive up, drove around the building and had a look for myself. I am just curious of what the final amount was for the renovations to that building, to have Newfoundland and Labrador Housing people move in there.

When I looked at the building, there are three different companies, I believe, two or three companies on the front of the building that are there renting space, I would imagine, from someone, whomever. The space that Newfoundland and Labrador Housing is occupying now, is that the only space that Newfoundland and Labrador Housing money was spent on it, or was it spent on any of the areas that are being occupied by these businesses?

MS J.M. AYLWARD: You mean, did Newfoundland and Labrador Housing renovate the other offices as part of the deal or something? Is that what you are asking?

MR. J. BYRNE: Yes.

MS J.M. AYLWARD: No.

MR. J. BYRNE: The only money that was spent by Newfoundland and Labrador Housing was spent on space that is being occupied by Newfoundland and Labrador Housing. That is correct?

MS J.M. AYLWARD: That is correct.

MR. J. BYRNE: You mentioned the Home Repair Program; we have covered that.

Social housing units with Newfoundland and Labrador Housing, can someone give me an estimate, I suppose - someone would know - of how many are in the City of St. John's and how many you have Province-wide?

MS J.M. AYLWARD: Most, as you would imagine, the majority of our social housing units, are located in St. John's, in the Avalon area. I think you would appreciate that. About 3,000 to 3,500 of those units are in this area out of a total of 7,000 units. We have about 18,000 people housed in those units across the Province.

MR. J. BYRNE: Out of those 3,500 in the city or in this general area, what is the occupancy rate of those?

MS J.M. AYLWARD: It depends really on the type of house or unit you are talking about. Some of our units, as you know, are four bedroom units and they are not suitable for the families that we are housing right now. There is quite a high demand for our one and two bedroom units but by and large we have about a 4 per cent vacancy.

MR. J. BYRNE: Four percent.

I have been informed recently, since Christmas actually, that some units in the Virginia Park area have been vacant for two or three months and waiting for work to be done. The reason why the work was not being done, or the repairs or renovations or whatever the case may be, was because the Newfoundland and Labrador Housing Corporation had their money spent in September for repairs and renovations back until - the year ends March 31 but for repairs, and home repairs, it was spent in September. Is there any truth to that?

MS J.M. AYLWARD: I think as you would know, representing maybe some of your constituents but certainly representing some of mine, and I am very happy to see that you spend some time in my District of St. John's Centre circling the building up there -

MR. J. BYRNE: Checking it out, that is all.

MS J.M. AYLWARD: Any time; you are welcome there.

One of the main reasons, as I pointed out, when I talked about the number of units that we have, we have a number of four bedroom units which are quite large and not necessarily in demand. If you were to do further investigation from your source, you would find -

MR. J. BYRNE: I am only asking.

MS J.M. AYLWARD: - that many of these units that are not refurbished or renovated because they are in very low demand; so we try to focus the money we have on the units that are in high demand, namely, one and two bedroom units. Many of those that are vacant, if you were to pursue that, you would find that they are four bedroom units and they are really in low demand. In fact, I have a number in my own district, four bedroom units. They are quite beautiful, in fact, but there is just no demand for them because they are just too big.

MR. J. BYRNE: I have just a comment on that. I am pursuing it because that is what I am here tonight -

MS J.M. AYLWARD: Pardon me?

MR. J. BYRNE: I am pursing it. That is why I am here tonight, and I go right to the horse's mouth and I am getting the answers.

WITNESS: The minister is not -

MR. J. BYRNE: That is a figure of speech. We know what we are talking about.

Is Masonic Park under the authority of Newfoundland and Labrador Housing Corporation?

MS J.M. AYLWARD: What was that again?

MR. J. BYRNE: The Masonic Park - the building itself, or the seniors who are there - is that a Newfoundland and Labrador Housing Corporation facility?

MS J.M. AYLWARD: It is partially subsidized.

MR. J. BYRNE: Partially subsidized.

I had a call from a resident there, a senior, who is on a very low income and he is having a very hard time with respect to meeting his payments because the rates went up not long ago, I believe. Is there anything with respect to having the rate geared to the amount of revenue that is received into the home?

MS J.M. AYLWARD: With this particular individual case to which you are referring, is this individual in a subsidized unit or a non-subsidized unit? Because it sounds like the person is not in a subsidized unit if you are talking about the amount of money and the rent. It doesn't have the same connect.

MR. J. BYRNE: The impression I got from him was that - and he wanted the question to be brought to the Newfoundland and Labrador Housing Corporation themselves, so I would imagine he is in a subsidized unit.

MS J.M. AYLWARD: Well, not necessarily. If you are living in a unit where - I have a number of places in my district where people are living in a building where there are a number of subsidized units but the building itself is not subsidized. Your next door neighbour may be in a subsidized unit but you are not and you are paying a lot more than they are, so they assume that everybody is in Newfoundland and Labrador Housing. Whether they are in one of the allocated units or not is an important piece to it.

MR. J. BYRNE: I will check it out.

That is it for my questions.

Thank you.

CHAIR: Are there any other questions?

I would just like to make a quick statement. In my eleven years in government now, I have to say that I have been dealing with the department and the Newfoundland and Labrador Housing Corporation for eleven years. I have to say, from all my dealings, there are times there is disagreement; but I can honestly say that the staff is always there to help out. I know the municipalities in the Bay of Islands and the Corner Brook area are very appreciative. Everybody is touched by Municipal and Provincial Affairs through their water and sewer, through roads, through their MOGs to keep the taxes down.

I have to say thank you to the department for all their work over the years. In 1989 when we took over the Bay of Islands, as the Liberal government, there was about 7 per cent with water and sewer. Today that is up over 70 per cent. So I have to say thank you to the department itself.

I would like to thank the regional manager, Tom Dunphy, out in Corner Brook. I know that Tom works very diligently on behalf of the department and promotes the department very well. He has helped out a lot of communities on the West Coast, even on the smaller things, helping to run communities.

Personally, to the department and to the Housing Corporation, thank you very much. I know the service that you provide. I know how many people you have helped and the improvement of quality of life that you have made to people. Sometimes it goes unrecognized because you pick on the negative stuff, but I know a lot of the positive stuff that has been done. So, on behalf of the constituents in the Bay of Islands and in the Corner Brook area, thank you very much.

MS J.M. AYLWARD: Thank you.

If I may, as some concluding remarks, I would like to take the opportunity, and for the record also, to acknowledge the hard work of my deputy minister and officials of the Department of Municipal and Provincial Affairs.

Also, thank you to my chief operation officer of Newfoundland and Labrador Housing and all your executive and staff, inside and outside workers, for your very hard work. I think that we try very hard to pass on to all of our staff how much we appreciate and value the work that they do on our behalf and on behalf of the people of the Province.

I want to thank you, Mr. Joyce, for your kind comments about the staff and their work. I am sure it will be appreciated and passed on. I would like to thank them as well, because I have been here about two months and I can say that I haven't found a more diligent, harder working group in any other department. I want to offer my thanks as well, and appreciation.

CHAIR: Are they any other comments?

On motion, subhead 1.1.01., carried.

On motion, Newfoundland and Labrador Housing Corporation, total heads, carried.

On motion, the Committee adjourned.