The Committee met at 9:00 a.m. in the House of Assembly.

MR. MATTHEWS: Before we begin, we have a routine issue to take care of. I am advised that we need to formally elect the Chair of this Committee. We will ask Jack Byrne, the Vice-Chair, who was already elected in a previous setting, to conduct the election.

On motion of Mr. Byrne, seconded by Mr. McLean, Mr. Matthews was elected Chair.

CHAIR (Matthews): Good morning, everybody. Good morning, Committee, Minister Langdon, members of the Department of Municipal and Provincial Affairs, and also the personnel from the Newfoundland and Labrador Housing Corporation.

This morning we are meeting to conduct the review of the Estimates of both the department and the corporation as a separate entity, as is the norm. Normally, we allocate three hours for these meetings. If we need to go beyond that, of course, we would have to reschedule and reconvene at another time.

We will follow the same rules that I have been observing for the last eight or nine years, and that are affirmed in Elizabeth's direction to me, in that we will ask the minister to lead off with a fifteen minute time allocation, followed by a fifteen minute allocation of time for the Vice-Chair or his designate to respond. After that we will alternate, if it is your agreement, to a ten minute speaking allocation of time. We will do that as often as we need to do it until the Committee is satisfied that they have attested the Estimates sufficiently and are prepared to vote on them.

Having said that, we will move forward. Minister Langdon, probably you would like to introduce or have your staff introduce themselves. Before you do that, I will ask my Committee to introduce themselves for the record. Then we will move forward with your Estimates, starting with Mr. Butler.

MR. BUTLER: Roland Butler, MHA for Port de Grave.

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

MR. McLEAN: Ernie McLean, MHA for Lake Melville.

MR. FITZGERALD: Roger Fitzgerald, MHA for Bonavista South.

MR. JOYCE: Eddie Joyce, MHA for Bay of Islands.

MR. FRENCH: Terry French, MHA for Conception Bay South.

CHAIR: Thank you.

Minister?

MR. LANGDON: I am Oliver Langdon, the minister, and I will ask each one of the officials beginning with the deputy minister on my right to introduce themselves as well.

MR. SMART: Bob Smart, Deputy Minister of Municipal and Provincial Affairs.

MR. DEAN: Leslie Dean, Chairman and CEO of Newfoundland and Labrador Housing Corporation.

MS MARSHALL: Mary Marshall, Chief Operating Officer of Newfoundland and Labrador Housing Corporation.

MS COLE: Ramona Cole, Assistant Deputy Minister of Municipal and Provincial Affairs.

MR. CURTIS: Ken Curtis, Manager of Financial Operations, Municipal and Provincial Affairs.

MR. CHURCHILL: Wayne Churchill, ADM, Engineering Services, Municipal and Provincial Affairs.

MR. ROSE: Baxter Rose, ADM, Policy and Planning, Municipal and Provincial Affairs.

MR. CONWAY: Jim Conway, Chief Financial Officer, Newfoundland and Labrador Housing Corporation.

CHAIR: Thank you, officials.

Minister.

MR. LANGDON: Thank you very much.

I want to thank my colleagues for giving up their time this morning to come and do the Estimates for the department. This is the third time, I think, that I have had the opportunity to come before the Committee, the second time as the Minister of Municipal Affairs - or third time as Minister of Municipal Affairs.

One thing I want to say before we begin, I am not going to take up the full fifteen minutes to go down through all the different programs in the department. I do not think we need to do that. It will give more time to the Committee to ask more questions and so on.

One of the things that I will say is this: the success of any minister in any department of government depends, to a large extent, on the people who work with you. It has to be a team approach and I value the work of the officials within the department. It is invaluable. I know at the end of the day it is my decision, in a sense, the final decision to make, but they give us, or give me, all the options that are there to explore, to look at, and the consequences of any decision that you would make and so on. I really value them, their expertise. They are professional people in their own right. It really makes any minister's job, in any department, much, much easier when you have people of the stature of those people who are behind me this morning, and I really appreciate that.

The department, of course, that I head, is the Department of Municipal and Provincial Affairs, and obviously we are involved with that. Coming under my direction as well is the Fire Commissioner's Office and the office of the Emergency Measures Organization. In addition to that, the Registrar General of the Province, and the other part of the department is the Housing Corporation, which is an independent entity with its own board of directors and its own CEO. Mr. Dean has already been here. That is the makeup of the department and I think we will leave it with that.

As I said, the Committee members can ask questions and to the best of our ability we will answer them. If, for some reason - last year, for example, Jack Byrne asked me, or the Member for Cape St. Francis - we should not go by the first name -

CHAIR: In Committee you can use first names. That is the rule.

MR. LANGDON: Okay, I will say Mr. Byrne. He asked me a number of questions on housing that I did not have the answer for, but I did subsequently get them and pass them along to him. The same thing would happen here this morning. So, if we do not have the answer we will get it for you and give it to you in the House, in individual form or in pamphlet or booklet or whatever. We want to make sure that we make your work easy as well.

I am going to leave it with that, Mr. Chair, and let the Vice-Chair lead off, and from time to time when it comes to all the details within the department I will pass it off to those people. They know the answers more than I do; they deal with it every day.

CHAIR: Thank you, Minister.

I am assuming Jack will respond, although I note that we have the critic, I believe, for your department, Roger Fitzgerald, here. I defer to Jack as to who leads off and how you take your first fifteen minutes.

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

I already discussed with Roger that I would lead off and ask a few questions. Before I get into that, I would just like to welcome everybody here this morning. I do not know how long it is going to take to get through it.

Just one suggestion, and I think we did the same thing last year. Newfoundland and Labrador Housing representatives are here, and it is not a big lot of information there, so maybe we should go with that first so they will not sit around all morning. Then you can probably leave if you want. That is up to yourselves.

CHAIR: If the Committee is agreeable to that suggestion from the Vice-Chair, the Chair is okay with that. Are you okay with that, Minister?

MR. LANGDON: We are there for the Committee, and what they decide is fine with us.

MR. J. BYRNE: It is only a couple of pages, so it is a waste of time for them to be sitting here all morning.

I am going to start right into this. I have a few questions with respect to Newfoundland and Labrador Housing. The first one, and I brought this point up last year, I have a note made here - detail. We have it here, Newfoundland and Labrador Housing, Total: Housing Operations and Assistance, and there is nothing really on the programs. The breakdown has: Program Funding Summary, $11,125,000, and we really do not have any detail that we could get into. I thought last year that it was agreed upon that we would have that type of information this year in the Estimates. I am just wondering why that has not happened.

MR. DEAN: Mr. Byrne, I raised the concern that you raised last year with Treasury Board and, given the fact that the sustaining grant, which is basically the single line voted, is not allocated line by line or program by program, Treasury Board advised that it would not be appropriate to break out the $11.1 million on a program by program basis.

Now, last year, after the Estimates Committee met, we provided some additional information which basically indicated that if you work on the assumption that approximately $3.5 million of the sustaining grant is a contribution towards the Provincial Home Repair Program, then the balance of approximately $7 million would be allocated notionally, at least, at the end of the year or during the course of the year, toward the full program portfolio of the Housing Corporation, whether it be - particularly the rent portfolio of the Housing Corporation which represents about 70 per cent of the total expenditures of the Housing Corporation.

Mr. Byrne, my understanding as well is that in other departments, for example, like the Department of Health, where you have a single line vote to the health care boards, that is the format that is determined by Treasury Board, not by the Housing Corporation.

MR. J. BYRNE: With respect to that, I do not know why it would not be appropriate. If you have a budget and you have so much for the Provincial Home Repair Program, whatever the case may be, and you have so much money allocated for maintenance, so much for salaries, so much for whatever, I do not understand why it would not be appropriate to have that information.

MR. DEAN: When we go forward each year to Treasury Board, what we will outline, basically, is the projected expenditures by program area, and in that context there is a document that would go forward to Treasury Board that would notionally indicate the total expenditures, the total revenues, and then the shortfall would, in fact, be the sustaining grant.

MR. J. BYRNE: That still do not answer why we could not get it here, as a Committee or as the House of Assembly, why we would not get that.

MR. DEAN: I would be prepared to discuss that request with Treasury Board and make that breakdown available to you.

MR. J. BYRNE: That is what I thought I requested last year, to be honest with you.

With respect to the Provincial Home Repair Program, in the Budget Highlights you have, "$11.5 million will be spent under the Provincial Home Repair Program to assist low-income homeowners maintain their homes." Two thousand homeowners will be affected, or helped.

Under the Program Funding Summary for the fiscal year, you have $11,125,000. This $11,125,000, that cannot be the whole amount of money budgeted for housing is it?

MR. DEAN: That is the only amount voted in terms of provincial contribution. The total current account budget of the Housing Corporation is approximately $100 million. The Province's sustaining grant only represents about 10 per cent of the total gross current account expenditures of the Housing Corporation.

MR. J. BYRNE: I have to get back, to be honest. I really do not understand why you would not have the full amount there, the whole budget, the hundred and - what did you say?

MR. DEAN: Approximately $100 million.

MR. J. BYRNE: One hundred million dollars and all we are dealing with here is 10 per cent of the budget of Newfoundland and Labrador Housing.

MR. DEAN: Yes, because that is the amount voted by the Province.

MR. J. BYRNE: Under Municipal Affairs you have a municipality that is charging taxes, they have to have their expenses, their amount budgeted, whatever the case may be, and present it to Municipal Affairs for approval. Newfoundland and Labrador Housing comes under Municipal Affairs, municipalities come under Municipal Affairs, I do not understand why there would be a difference; why one would be required and the other not.

MR. LANGDON: There is a difference. The thing that you are looking at here is a sustaining grant from the government. The monies that a person would pay for rent in any of those housing units across the Province is not included here. It is in their budget, but it is not for us to approve. This is rent that is being paid to Newfoundland and Labrador Housing for clients right across the whole Province.

MR. J. BYRNE: But Municipal Affairs is ultimately responsible for revenues and or expenditures of Newfoundland and Labrador Housing, and Newfoundland and Labrador Housing comes under Municipal Affairs. What are we doing here then?

CHAIR: Would the explanation be as simple as saying that the housing money voted in the budget is not unlike what is voted to health care boards, and the issue of examining expenditures would be no different for housing then it would be for the health care boards? We do not do the health care boards in the Committee of the House nor do we do the Housing Corporation nor do we do the Liquor Corporation. Is that the simplest (inaudible)?

MR. LANGDON: That has been the progress over the years.

CHAIR: I am just looking for clarification.

MR. J. BYRNE: That is exactly right. Thank you.

With respect to the social housing, in the Budget Highlights it says, "$4 million will be spent on a cost shared Affordable Housing Agreement with the federal government." Is that the $4 million from the Province or is it $4 million in total? What is the breakdown on that figure?

MR. DEAN: As government has indicated, early in the new fiscal year government will be entering into a cost-shared agreement, signing a cost-shared agreement with CMHC, which is the federal government agency responsible for delivering the National Affordable Housing Program.

Under the Affordable Housing Program, the provinces are entitled to receive credit for expenditures that they have incurred as of January 1, 2001. In that context, the Province is entitled to a credit of approximately $4 million associated with the special housing initiative in Northern Labrador.

The proposal, in terms of cash flow in year one, is to flow $4 million, which the Housing Corporation will borrow, but that will be offset by $4 million in revenue from the federal government. So, in year one of the program there will be no net expenditure on the part of the Corporation or the Government of Newfoundland and Labrador.

MR. J. BYRNE: With respect to that, a few years ago - probably six or eight years ago maybe - it could be longer, I thought the federal government had gotten out of social housing and Newfoundland and Labrador Housing took responsibility for it and it became a pretty big burden. Are they getting back in now?

MR. DEAN: It is very, very interesting, Mr. Byrne, because this national program is not referred to as a social housing program. It is characterized as an affordable housing program. In the context of CMHC, it is a subtle difference, I know, but they do not characterize this program as social housing. They refer to it as increasing the supply of affordable housing across Canada. Now, of course, they have also announced some other initiatives in support of the homeless, for example. I guess in that context one could probably make an argument that that is closer to the social housing challenge than the affordable housing challenge.

MR. J. BYRNE: It sounds like we are playing with words - semantics really.

On salaries with the Newfoundland and Labrador Housing, I am just curious. I am hearing that there has been a recent employee employed, who was an executive assistant of a former minister, whose job now is to be involved with the Provincial Home Repair Program. I am just curious of what that individual's salary would be? Was that position advertised? Can you show me in the Departmental Details where that salary is? Would anybody like to comment on that?

MR. LANGDON: In the Housing Corporation, for years and years and years, there has always been political staff tied to the Housing. This is no different.

I had a parliamentary assistant over at Housing, Mr. Jim Walsh, who was there for probably a couple of years and did a tremendous amount of work for me in answering and interceding on behalf of all MHAs on work that was to be done. When he left, there was nobody out of the political staff over at Housing to do the work to intercede on behalf of the requests that came in from the MHAs. Then I hired - not through the civil service, it has nothing to do with them. It is not for three years, as was characterized in the media. It is a six month contract that I gave him - political assistant to me, as the minister, to do some work for me to intercede on behalf of the MHAs. His salary, I think, is $48,000. That is the parliamentary assistant salary. It is not configured out of any other thing. We follow the guidelines that are laid down, and that is what it is.

You have to remember that it was not to bring him in at the time that he was with Beaton Tulk. He had been at home for eight months. It was not put in immediately at Housing. It was when the vacancy occurred, when Minister Walsh moved out, and then I had to have somebody there. It was a political appointment, and it was not advertised. No more did the Leader of the Opposition advertise when he brought in Len Simms, or when the Premier upstairs decided to bring in Robert Dornan. There is no difference; it is political.

For Fabian to think that somehow or other he is over there doing the work of people who are in the civil service, that is not true. If you were in my place tomorrow then you would hire your own political staff, and that is what it is; no more, no less.

MR. J. BYRNE: Further to that, though, to make a comparison, I think to say it is no different than having Mr. Walsh, who is a Member of the House of Assembly, as an assistant, operating from the House, and bring in a person who had not been elected, there is a distinct difference there, though, wouldn't you think, if he is going to be doing the same work?

MR. LANGDON: Well, the thing about it is, there were people over in the political staff over at Housing before Mr. Walsh went there. That has always been the case. You can go back in the records and find it. I am sure you will find it when every Administration from 1971 up had political staff, and one was assigned to the Housing Corporation. In situations gone, there have been ministers just of Newfoundland and Labrador Housing. That was their job; no more, no less. So, there was no political bantering or whatever. I hired the person, political staff for me, and you do not go out and hire. I went through that one time before. When my parliamentary assistant went to work with the Premier's Office and I hired another person, I did not advertise it. I mean, that is a political staff for me and there is no difference -

MR. J. BYRNE: So you are saying that this position is not a - it is a six month contract?

MR. LANGDON: It is a six-month contract.

MR. J. BYRNE: It is political.

MR. LANGDON: Political.

MR. J. BYRNE: And this person will not, basically - if there was a job in the civil service, in a part of the public service, he would have to go through advertising, an interview, and whatever the case may be.

MR. LANGDON: Absolutely. There is no way that he is part of any civil service. It is just a political appointment for six months and that is it.

MR. J. BYRNE: Along the same lines now - I am not sure if it is happening in Housing but it could very well be - it seems to me that a number of people being employed in the public service these days, and Housing is a part of that, are brought in on a temporary basis, they are in the system, and then they have an unfair advantage to somebody, say, outside when they advertise a position, to get that position. That is the way it has been happening through the line departments. Is something like that happening at the Newfoundland and Labrador Housing?

MS MARSHALL: I am not sure of the exact numbers, but the people who we have as temporary appointed are people who are associated with the Provincial Home Repair Program. Those employees receive their jobs through competitions. They are temporary only by the fact that the Home Repair Program is temporary until it is voted again in the House. As of yesterday, we were not sure - it was announced previously but it could have ended yesterday. That is the kind of temporary appointment that we have at Newfoundland and Labrador Housing Corporation.

MR. J. BYRNE: If there was a job that was advertised at Newfoundland and Labrador Housing, a permanent position, a full-time position, could these individuals then have an advantage over somebody outside because they are in the system, if it is an internal position?

MS MARSHALL: They would be able to apply as internal applicants but most of these people have about ten years experience with us and they did get their jobs through competition.

MR. J. BYRNE: I am okay for now. Is there any more? Does anybody -

MR. FITZGERALD: I would like to ask a few questions.

Minister, what is the number of applications on file now for help in the Home Repair Program?

MS MARSHALL: Approximately 5,500.

MR. FITZGERALD: Approximately 5,500, and we will able to help approximately 2,000 this year was the projection?

MS MARSHALL: Yes.

MR. FITZGERALD: So, what we are doing is, we are talking about applications dating back to - where are we working from, 1999 maybe?

MS MARSHALL: It varies from region to region. Some are dealing with 1999-2000.

MR. FITZGERALD: It is kind of frustrating when you get, especially seniors, Minister, calling. In fact, I had a call just yesterday from a senior constituent of mine, seventy-six years old, who put in an application last year and needed repairs done to his roof - his roof was leaking, so necessary repairs - to be told, I am sorry, we are only doing 1999 applications and unless it is considered as an emergency you will have to wait your time.

MS MARSHALL: That is correct.

MR. FITZGERALD: I do not know how that individual will be able to wait for another three years, or another four years probably for him, before he will ever be able to take advantage of a program that, when it was advertised, it was advertised in such a way that, we are putting forward some help here to people of low income, especially seniors, targeting seniors, to be able to do repairs and maintenance and upgrades to their homes with a $5,000 forgivable loan - only to find out when they go and try to access the program, they are on a waiting list for three or four years and may never ever see the work done, or have to go and borrow themselves in order to carry it out. Can something be done in order to speed up that process?

Obviously a lot of those applications, by the time they are ever reached to be considered, or ever come forward for inspection, probably the work is already carried out because people cannot wait that long. There is certainly a great need out there.

I know in the area that I serve there is a great need there. You get some through the Gander office, and it is frustrating when you are dealing with that kind of a situation.

MS MARSHALL: It is a difficult situation. It is difficult for staff to try and deal with. I know that some of this type of work may be done but usually the applicants, by the time they are served, if they do have to wait their time, still have work that they can have assisted under the program. We do deal with emergency situations where there are life safety issues, and those people will be moved ahead on the list.

MR. LANGDON: In a situation like that, Roger, I do not go to the Housing Corporation - these officials can tell you - to interfere with putting Roger Fitzgerald ahead of Eddie Joyce, or something like that. I have never done it and I do not believe in that. Because, if you do that, it is like - sometimes you go out and some people say, or when you get a phone call: Can you intercede in getting my father in for open-heart surgery, or whatever the case might be.

Well, if you did that, then Roger Fitzgerald, who was number one, than becomes number two. Who has the right to do that kind of thing? I do not do that. If there is a situation where you have an emergency situation like that, where the roof is really leaking, then if you would bring it to me, I would then take it to them or you could go directly to them.

I have always acted in good faith with the people in the House of Assembly and I try to treat everybody fair and square by doing it. If you have a situation like that, I would be only too glad to entertain it, to pass it along, but I do not want to, in a sense, jump the cue because that would not be fair; but if you have a situation, you bring it to me and I guarantee you that I will personally look into it and take it to Mr. Dean to be done.

You can see the situation where I do not want to interfere with the list because then the person who would have been number one would then become number two and somebody else become number three, and I do not want to do that; but if there is a problem, see me and I honestly will give it a best shot to see if we can deal with it for you. I really would do that.

MR. FITZGERALD: Yes, Minister, I understand that, and I certainly have a good relationship with the Gander office there. Norm Feltham certainly goes beyond the call of duty to try to make sure what is needed to be done gets recognized, but in most cases, in a lot of cases, before they will move somebody ahead, it has to be deemed as an emergency. An emergency is a fire or a flood or some reason why people cannot continue to occupy their homes. A lot of the work today - and this is a good program. This is an excellent program. All you have to do is drive around the Province and see the condition of some of the properties in the Province today compared to ten years ago, and this program has been responsible for a lot of that, but I am not so sure that we fund it in a way that it should be funded, and I say that in that what we consider as normal maintenance sometimes is not normal maintenance. When you look at people occupying that home with children there, if windows need to be replaced or doors need to be replaced, or the bridge leading up to the house needs to be replaced, then we consider that as normal maintenance but it is not normal maintenance. That is something that you need in order to occupy that house and call it a home. A lot of those repairs and a lot of those applications sometimes fall outside of the guidelines, and maybe we should look at those things in a more compassionate way and include all repairs that continue to make that home liveable.

MR. LANGDON: Last year we spent $6.26 million on home repairs. This year we are doing a bit better. We are looking at $7.5 million. It will make a difference in a number of homes, like you said. We do not have the money to do it all, but $7.5 million is a good start and, like you said, it is in my area and I am sure every person who is in the rural part of the Province can see the difference that it has made.

Our fear was that the feds would not come through with a new program as of March 31, but they did. We would have been in real trouble had they not done that. This year we are spending about $7.5 million, is that right?

WITNESS: (Inaudible).

MR. LANGDON: They tell me here that about 92 per cent of that is in rural Newfoundland.

MR. FITZGERALD: Does Newfoundland and Labrador Housing build housing units any more?

WITNESS: (Inaudible).

MR. FITZGERALD: They do not.

The places where you see Newfoundland and Labrador selling housing units, is that because there is no demand there any more, or is it an area where it is not feasible to upgrade those units any more because of their condition?

MS MARSHALL: Generally speaking, if we are selling a unit anywhere in the Province it is because there is a lack of demand. We have left them vacant for a period of time, and what we are finding is that we are more likely to have vandalism if they are left empty. We do have a rent supplement program, so we feel that if something comes up in those areas later, particularly with the way out-migration is affecting various communities, we do have opportunities to rent from a private person possibly another house in one of these. Usually there are more remote communities where we are selling. We are not selling our units in Gander, Grand Falls, Corner Brook, those kinds of places. In Marystown we do have vacancies but there is an exception there; there is an unusual number because of the impact of out-migration.

MR. FITZGERALD: Thank you.

MS MARSHALL: Could I make one further comment with regard to the Provincial Home Repair Program?

I think part of what you are seeing is as a result of the fact that we realize that our outstanding wait list is fairly long. The way we deliver the program, we do spread the program a little bit more thinly than we have in the past, but it is in order to try and deal with the people, the type of people you just mentioned to us. Because of that, we are not doing the full gamut of all the repairs that people would like to have done on their houses but we are trying to focus our money to the priority needs. That is the explanation as to why you are seeing some of what you are seeing.

MR. FITZGERALD: Yes, but some things that I think are considered, or that you people consider as normal maintenance, are certainly big ticket items to the people who live in that house. It is kind of hard to live in a house if the doors have a two inch opening on each side or the windows - when the wind blows the curtains are out like the kitchen table.

Is there a ceiling on the amount of money that Newfoundland and Labrador Housing will spend on a unit for repairs and upgrades?

MS MARSHALL: Of our own housing?

MR. FITZGERALD: No, on private housing.

MS MARSHALL: Under the Provincial Home Repair Program?

MR. FITZGERALD: Yes.

MS MARSHALL: Under the program, a client may get up to a $5,000 forgivable loan, which is basically a grant. They could get an additional $5,000 if they require accessibility adaptations - if they needed to have a bathroom on the main floor, or ramps, or something like that, and they can get up to $5,000 of a repayable loan. The absolute maximum is $15,000, but we have very, very few of those.

MR. FITZGERALD: That would be the amount of money that you people would spend as a forgivable loan?

MS MARSHALL: Ten thousand would be forgivable - the first two $5,000 amounts - and then the third $5,000 would have to be repaid.

MR. FITZGERALD: If I come to Newfoundland and Labrador Housing looking to have my home repaired, and if the cost of repairing that home is over $15,000 then you would not participate in the program?

MS MARSHALL: We may, if you have a debt ratio that will allow us to see how you could find the additional funding. We would also look at the value of the house. It gets to be a very difficult judgement call to see if it is worth investing that kind of funding. Many of the houses that we do deal with, they are not luxury homes. We do look at them from the standpoint of whether or not possibly there might be some other alternative that would be better for the client. If there is an opportunity to find the total funding from some other source, we may still participate up to the maximum of our program.

MR. FITZGERALD: If I am building a new home today and I do not have it completed, you people would not take part in providing me with funding in order to help complete that home?

MS MARSHALL: No.

MR. FITZGERALD: Is there an age limit on the property that you (inaudible)?

MS MARSHALL: We would normally expect people to be in the home for about a five year period.

MR. FITZGERALD: Not necessarily completed, but living in the house for five years?

MS MARSHALL: When you talk about people who are living in their homes -

MR. FITZGERALD: It is not uncommon in rural Newfoundland, as most people know, you go and you do what needs to be done. You move into your house and you complete it as you live there. If the house is not completed, would you take part in the program then?

MS MARSHALL: If they are living in the house, we would allow them to repair the portion of the house that they have to live in. We do not extend houses. We would not build on an extension, or we would not finish another part of the house which is -

MR. FITZGERALD: Or complete what has not been finished?

MS MARSHALL: If they are living in the house and say it is the bedrooms they are living in and it were leaking, we may be able to fix that. If there was another room that was not necessary for the family to live in we would not do that kind of work. I have to say, the average house that we deal with is forty-one years old. They are not new houses that we usually deal with.

CHAIR: Minister Ernie McLean - former minister. You indicated you wanted to have an intervention.

MR. McLEAN: Thank you, Lloyd.

Just a couple of questions. One for clarification. On the new program, the $4 million program that is committed, it is identified for specific housing needs for seniors, mentally and physically challenged, and also low income. Is that only for repairs? Did I hear you earlier that there are no new builds?

MS MARSHALL: The new program is totally different, minister, it is for the construction of new housing. Under the federal terms, affordable - I guess affordable is in the eye of the beholder. The federal term affordable just means average market rent. When we try to deliver this program we are going to try and target a much lower income group of people. This new program provides subsidies for construction. Predominately rental properties, although we may be able to do some home ownership in Labrador. Again, under the federal guidelines there is a different definition for the northern part of - actually, their definition, all of Labrador fits what they call remote under that program. We may be able to do some home ownership there but otherwise it is really geared toward the construction of - subsidizing the construction of rental properties.

MR. McLEAN: There will be a new committee or a whole new circumstance for this particular program than there is for the regular housing program.

MS MARSHALL: Yes, totally different.

MR. McLEAN: Just a second piece, for clarification. On your regular program - each of the regions deal with their own necessities and needs. Is the budget designed that way as well or is there an overall budget that everybody feeds into to determine who is on the list and who is not, who has priority and that sort of thing?

MS MARSHALL: Are you talking about the Provincial Home Repair Program?

MR. McLEAN: Yes, the Provincial Home Repair Program.

MS MARSHALL: On the Provincial Home Repair Program, yes, each region deals with their own waiting list.

MR. McLEAN: But they have an allocation of money?

MS MARSHALL: Yes they do.

MR. McLEAN: So much money that will do that program.

MS MARSHALL: They do. If near the end of the year one region is having difficulty for some reason delivering their funding and another region has a shortfall, we will reallocate; but predominately, throughout the year each region has their own budget and they are responsible for delivering that.

MR. McLEAN: Just a final comment. I certainly had a good working relationship with the Newfoundland and Labrador Housing Corporation. I think in order for us to address a lot of the needs there has to be some flexibility. I found that the local office in Happy Valley-Goose Bay were able to deal with the flexibility piece and accommodate our requirements for the most part. So that is much appreciated.

CHAIR: Thank you.

Tom Osborne.

MR. T. OSBORNE: Under PHRP, minister, I have a couple of comments. For the most part I found that Housing have been cooperative with my requests. I understand there has to be a level of reason in dealing with the timing of applicants and when they get processed.

There are times, as my colleague, Mr. Fitzgerald, had mentioned earlier, where we feel - I mean there is no possible way a person is going to be able to wait two or three years. The deterioration of their property as a result of a leaking roof, or whatever the case may be, may warrant an earlier look. For the most part, I have found them, under PHRP, to be reasonable in my requests.

Having said that, I do have a question. It is with regard to the changing policies of the insurance companies, where insurance companies are now cancelling policies that homeowners have had for sometimes twenty-five and thirty years and have never really laid claim, or made a sufficient claim under their insurance, but because their electrical is not up to standard the insurance company will cancel their policy; or because maybe their oil tank or that type of thing is not up to standard, they will cancel their policy.

I know of a couple of cases right now in my district, where because the electrical is not considered by Housing to be deficient or dangerous but it is not considered by the insurance companies to be up to standard, their insurance policies are cancelled. While that may not be considered an emergency in some eyes, for a home owner, a senior citizen who always had insurance on their property but simply cannot afford to upgrade their electrical panel or whatever the case may be, that can cause a great deal of stress. I am wondering if there are any provisions within the PHRP maybe to have another look at that policy?

MS MARSHALL: When we deal with applications for assistance under the program, such as what you are talking about, we would look for an electrical inspector's recommendation that the work would have to be done. If an electrical inspector does not recognize this as being required work for life safety, we cannot cover it under our program because, as we have already said, we have so many other applications where there are life safety issues.

I think there is a question here as to why the insurance companies are taking the stand that they take, where many houses in this Province, probably some of our own houses, are not up to standard if you look at today's code, but we do not upgrade them necessarily because it is not a life safety issue. The way you describe it really is how we interpret and deliver our policy today.

MR. T. OSBORNE: Okay. The other question I have is with regards to the new program for construction of new housing units - and I see the minister nodding his head. I think he knows my question. I have presented a couple of petitions, actually, in the House and it is regarding handicap accessible units in my district, in particular. There is really a lack of handicap accessible units in the downtown area and, in particular, in the Shea Heights area. I am just wonder if, under the new program, there are any provisions for new construction in Shea Heights and in the downtown area of St. John's?

MS MARSHALL: We have not, as yet, identified local areas as specific as Shea Heights but we do know that the St. John's region is an area where the vacancy rate, even in the private sector, is very low. Funding will be allocated to the St. John's region.

With regard to the accessibility requirement, whenever we deal with any proponents we will be making it a necessity to have a certain percentage of those units made accessible.

MR. T. OSBORNE: I will give you one example now. There is a young girl, only in her twenties, right now who is living in a senior citizens building which is owned by Housing in my district because, quite simply, they cannot place her in a handicap accessible unit. It is creating some complications between the seniors and her because a young girl in her twenties obviously is going to want to listen to rock and roll music and the senior next door is not into that and does not like the music loud. Obviously, there is a compatibility issue there.

The other question is - I know Housing have a very large shortage of one and two bedroom units. Is that going to be addressed as well with the new construction under the new program?

MS MARSHALL: I really think the predominance of units constructed under the new program will be two bedrooms or less. We are not looking at large families anymore. We still have a number of large families in our units but the waiting list is going to be looking for smaller units. The aging population too, generally most of those people only want one or two bedrooms.

MR. T. OSBORNE: Before I move on to my next question, I will urge the staff at Housing, in particular the downtown area and the Shea Heights area - I know in Shea Heights the families who live there want to stay there. That is where their support networks are. While it is apart of St. John's, in many respects it is like rural Newfoundland where people want to live in their own community. They want to stay where they grew up and their families and friends are. Because they have a disability, are forced to either live in a non-accessible unit or move out of their community. Whereas in many other areas of St. John's you do not have that same dependence on your neighbours and your community so to speak.

The other question I have with the PHRP program - a number of the applicants that I have had approved over the past three or four years, I have given an estimate as to what the repairs should cost. I do not know if is because of a construction boom in the St. John's area, but they are not able to locate contractors. I have one lady now who is approved to have her roof repaired. Her roof is literally falling in. If you go into her house her ceilings are falling in because her roof is that bad. She is approved, but she was unable to secure a contractor until the winter. I guess when work was slow and a contractor was willing to say: Yes, we will get to your job the first thing in the spring. She was several months looking for a contractor and not able to find one who was willing to do the work for that price.

Are there any provisions to make changes to that policy, where if a person has gone out and sought prices from six or seven or ten different contractors and not able to locate a contractor, either their application is going to be cancelled or their work is simply not going to get done?

MS MARSHALL: Under those circumstances we would not cancel the application. We do talk to people and we encourage them to spend the money that has been committed. We recognize that, particularly in the St. John's-Mount Pearl area last yea, it was very difficult to get contractors. It was not a matter of money. People who had all kinds of money to have renovations done on their houses last year could not get contractors. The industry was very busy. I do not believe that increasing the cost is going to resolve that issue. It is a matter of the forces that are at play in the market.

Our staff are recognizing difficulties that some of the clients are having in trying to commit their funds. It is actually sort of an administrative difficulty for us because the money does not get spent in the right year. We have a budgeting issue that we have to try and reallocate things each year because we do not want to cancel applications for people, such as the client you referenced, but on the other side, if people who have come in and been given a commitment but just do not proceed, we do need to be able to free up those funds to give to somebody else. Again, it is one of these difficult areas where we have to try and deal with it. Anyone who last year had commitments to do work and did not get it done, they should be able to get someone to do it this year because they can get someone right at the beginning of the year when contractors are usually more ready to take something on because other people are not quite ready. It is unfortunate that maybe a year lags but that is (inaudible).

MR. T. OSBORNE: Without getting into the specifics of this particular case, I guess where the ceilings are now actually falling in, there would probably be room within Housing to look at those repairs as well, that were caused by the initial concern?

MS MARSHALL: Possibly, yes. There may need to be additional cost to cover that, if there has been significant further deterioration.

Could I just come back to your comment, your questions, on the new program, the affordable housing program? I would just like to make it clear, that program will provide subsidies for construction, and generally most of the funding we envisage being spent either by the private sector or community groups. There may be some projects that government would take on as partnerships, maybe, Minister, with your colleagues in Health or Human Resources and Employment, but predominantly we are seeing that program being offered as a way to encourage the private sector and community-based groups to put projects in place. They will be coming forward in response to requests, or Statements of Interest that we would like to hear from people to see.

We will be identifying for government, or on behalf of government, the areas where we feel housing is most crucial, where it is really needed, and then we are really looking for private and community-based components to go forward with those projects.

CHAIR: Thank you, Tom.

Did I recognize your hand, Terry? Do you want to intervene?

MR. FRENCH: I just have a couple of brief questions, actually. Does the Corporation have long-term leases with people who provide housing units to you guys, rental properties?

MS MARSHALL: Through our rent supplement program, we have leases. They are not long-term leases; they may be twelve month leases.

MR. FRENCH: They would not exceed twelve months?

MS MARSHALL: I am not sure if they go beyond twelve months. They may be rolled over, but each time they will be reassessed.

MR. FRENCH: I guess it would be based on the demand in the community.

MS MARSHALL: Yes. There are about 1,000 of those around the Province. Approximately 700 of them are in the St. John's and Mount Pearl area. That portion of the program does allow us to have some flexibility. As the lease rolls over, becomes mature, and the client is no longer needed there, we can move that funding into another area of the Province where there is a higher need.

MR. FRENCH: So, if the demand was high in a certain region of the Province and there were five units available, you would not necessarily go out and lock them in for ten years?

MS MARSHALL: No.

MR. FRENCH: It would still be a one year turnaround, or six months, or whatever the case?

MS MARSHALL: Yes.

MR. FRENCH: Is it possible to get a breakdown of provincial districts, how much is spent in each district in the Province?

MR. J. BYRNE: I asked about that, actually. I have it.

MR. FRENCH: You have it? Thank you.

I did not see those numbers. One other brief question. How many political staff are actually at Housing?

WITNESS: One.

MR. FRENCH: Just one?

WITNESS: Yes.

MR. FRENCH: Okay. The rest are public servants?

WITNESS: Yes.

MR. FRENCH: Thank you.

That is all I have.

CHAIR: Thank you, Terry.

Are there any other interveners that have not yet spoken, wishing to?

Okay, we will revert to the Vice-Chair.

MR. J. BYRNE: Thank you.

Just a few comments, actually. I will get down to the nitty-gritty now.

I want to compliment Newfoundland and Labrador Housing on something. I had a situation in my district this past winter and, let me tell you, it was a pretty serious, dire situation. I had to get a representative from Newfoundland and Labrador Housing, Community Health, Human Resources and the municipality together, and we had a meeting. Usually, oftentimes you see in government where people see the details, they do not see the broad picture. Newfoundland and Labrador Housing representatives were key. They did see the broad picture and they came together really quickly. I have to say, and I told them at the time, I was quite impressed with what had happened and how it continued forward, and it is still active now.

I just wanted to make that comment. We are here to ask questions but I do not mind giving credit where credit is due, let me tell you.

Other than that, I just want to say thank you for your time, in being here this morning, and I appreciate your answers.

WITNESS: Thank you.

MR. LANGDON: I will just conclude by saying, as I said earlier, if there are some extenuating circumstances, the thing about it is - and I stand by what I said earlier in the introduction - the people who work at Newfoundland and Labrador Housing, like Les and Mary and other people, they do their best. They recognize the need, and if there is sometimes a situation that does not go the way you want it, then contact them personally. I am sure they are open to that. The whole idea is to serve. We do not have all the financial resources to do everything that we want to do, but I think there is enough flexibility, by working with the people, that at the end of the day you can find a consensus and a conclusion, like you did.

MR. J. BYRNE: Just to that again, you use the word flexibility. I think in this situation - I do not know if you know the situation I am speaking of - they went beyond, I think, and it was appreciated by everyone involved.

MR. LANGDON: Thank you.

CHAIR: Thank you very much, Minister.

Seeing no other interveners, I am going to ask the Clerk to call the heads for the Housing Corporation.

On motion, subhead 1.1.01 carried.

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

CHAIR: That concludes, then, the hearings on the Housing Corporation.

Thank you very much for your interventions. Thank you, Minister and staff.

MR. LANGDON: Thank you very much.

CHAIR: You may wish to return to whatever you do on a normal basis and we will see you in twelve months. Somebody will. If I am not here, do not come looking for me. We will see you later.

I think the Deputy Chair has suggested that we break for five minutes after the Housing Corporation hearings, if that is agreeable.

WITNESS: (Inaudible).

CHAIR: Ernie and Terry, the Clerk is advising it is going to be a little while before the coffee is ready, in the event that you are interested in that, so we suggest you take your seats again and we will let you know when you can leave.

The Housing Corporation people can leave.

I will now ask the Clerk to call the appropriate head for the commencement of discussion of the Department of Municipal and Provincial Affairs Estimates.

CLERK: Subhead 1.1.01.

CHAIR: Subhead 1.1.01.

Jack?

MR. J. BYRNE: Roger, do you want to lead off, or will I?

MR. FITZGERALD: No, go ahead.

MR. J. BYRNE: Okay, I will start off and you let us know when it is time to -

CHAIR: I will let you know when the coffee is ready.

MR. J. BYRNE: Thank you.

On page 223 of the Estimates, under Minister's Office - the way we have normally done this in the past, of course, is that we have the subheads and just go down through them and make the comparisons and ask the questions why this may happen or did not happen or whatever, or why some money was spent, was not spent, or went over budget.

In the Minister's Office, under 1.1.01.01., Salaries, you had budgeted $249,000 and you spent $266,000. I know it is only $17,000 there, but why would that extra money be there?

MR. SMART: You will find in all our salary accounts, actually, the budget for the Department of Municipal Affairs in salaries is no different this year than before. Each year when we do our budget, we assume we will achieve a certain level of savings because of vacancies and maternity leave and whatnot. We have to make that assumption at the beginning of the year and assign that level of savings throughout all these different accounts. Now, it never works out the way we make our assumptions. The vacancies happen somewhere else and we save money where we did not anticipate the savings, and in the places that we did anticipate savings we do not. So what you will find as you go through the salary votes is that some are over budget, some are under budget, we achieved savings in certain areas and we did not achieve them in others, but overall the salary budget itself is basically the same.

The other thing in the minister's account, we did have to pay out an amount for vacation pay to previous political support staff not even under the current minister, actually. There was someone who left the department a couple of years ago and, for reasons I am not aware of, did not take her vacation pay at the time and came back to us this year and said: You owe me money. So, obviously, we did owe the money and we paid it out.

On the salary votes you will see that these go up and down. Really, the litmus test for us in the department on salaries is what the bottom line was for the department. One account went up, one went down. That is fine. As long as we can balance to our bottom line we are okay.

MR. J. BYRNE: Under the same subhead there, .03, Transportation and Communications, you budgeted $51,900 and you spent $74,400. Twenty-three thousand, I suppose, is it? Pretty close.

MR. LANGDON: I can answer that.

One of the things I did when I became minister, I said to the councils: I have an open door and whoever wanted to come in could, and I stood by that.

The other thing I have done is a lot of travelling. I had meetings in councils where probably no minister had ever done it before. It is not because I want to travel. It is because I think, as a minister, with so many of the small councils across the Province, they deserve the right to see the minister as well. I have done that.

Roger would know, for example, we went on a couple of trips down to Catalina. We are working with Catalina, Little Catalina, Melrose and Port Union now to bring them into one administration. We will know probably this week, Roger, if Little Catalina is going to be a part of it or not. We are right into the throes of it. They have their committee formed - as you would know, you are part of all of this - and we have our committee. We are working together with the hope that we can have one council and share some services.

I have travelled to Eastport and down to Sandy Cove with Kelly Blackmore and the people there. I have gone to the Northern Peninsula. I have travelled to a number of places to meet with councils. The thing about it, Jack, is I still have a list that much where I cannot go to everyone of them, and it is expensive to travel. For those of us who travel from here to Gander, you are looking at $500 for a return ticket. It adds up. It is not something that you want to do, but I have made a commitment to do it. That is where it is.

MR. J. BYRNE: That leads me to the next question, because I would assume that what you did last year you are going to continue to do next year. You spent $74,400 last year and you only budgeted $51,900 again for next year.

MR. LANGDON: Well, that is the type of situation. I might not have to go to Port Union as much. I might not have to go to the Northern Peninsula. Because we are working with Trevor and Wally up there, we are looking at, on that part of the coast, where there are nine unincorporated communities and two incorporated communities having one council. It is a lot of

work that has been done. I probably will not have to go back there to meet with them again but I am telling you that it is - and all of you know, you have been in public life like I have. If you have been in one hotel you have been in them all. If you have been on one plane you have been on them all, but it is commitment that you make to people who are out in the field. A lot of them in this Province - as Roger would know, and Jack too, so would Tom and Terry - that there are so many small councils and the guys get no remuneration, they get absolutely zilch. A visit from somebody, as a minister, to meet with them and help solve some of their needs, it is greatly appreciated.

MR. J. BYRNE: With respect to - I am not questioning your travel, I was just wondering why you did not put more on -

MR. LANGDON: No, I understand, but I just thought I would make that point.

MR. J. BYRNE: Purchased Services, you had budgeted $3,700 and $17,000 is there. So you are looking at $13,300 more than what was actually - well, you are looking at four times what was budgeted.

MR. LANGDON: It went from $3,700 to $17,000 to $3,700. Again, that is the increasing costs with hosting meetings with municipalities and umbrella groups. When you go out into an area you are going to have to invite the council to a meal and stuff like that. You cannot do it and when they come in here into town - if you come in from out around the bay, you have been there for awhile, then obviously you meet the council for breakfast or whatever. It all adds up.

MR. J. BYRNE: On the same page under General Administration, Executive Support. Again, you have the salaries. You had $491,900 budgeted, $536,300 spent. This year it is up even further, $554,100 - that is $63,000. So you must have an extra -

MR. LANGDON: No, I do not have anybody extra but I think - and Bob can clarify that for me. Some positions were clarified, I guess, or a classification step and some people got higher.

MR. SMART: It is the exact same. We have the exact same number of positions in Executive Support as we had before. It is just that the salary levels on some of these have changed because positions get reclassified, primarily secretarial and clerical support positions. Last year as well, we may have assumed that we would achieve a certain level of savings because of a vacancy, a leave or something in Executive Support, but that never happened so we did not achieve the specific saving there.

No, there is no change in the staff complement at Executive Support, which is essentially the deputy minister, three assistant deputy ministers and three secretarial support staff.

MR. J. BYRNE: You are talking about savings here but we are spending more. You are looking at between 10 per cent and 15 per cent of an increase in that one allocation. To say that people were reclassified - then we have the increase in salaries each year or whatever the case may be, but that seems to be high, in my mind.

MR. SMART: If you are comparing it to the $491,000 -

MR. J. BYRNE: That is what I should do. That was budgeted last year. It went from $491,000 to $554,100.

MR. SMART: Yes, but $491,000, as I said, when we do our budget we assume a certain level of savings in the department, assuming we will save $300,000 in salaries due to vacancies, and so on and so forth. We spread that throughout the whole department. We really have no idea where we are going to achieve that. We spread it throughout the department. In Executive Support we would have assumed we would save something there but we did not because no positions became vacant. Therefore, our revised expenditure, the actual current service level of expenditure is the revised amount of $536,000 and you will see that adjusted for salary increases and what not. It is all the same people actually, no staff turnover at all.

MR. J. BYRNE: I don't know if I have a mental block on this one but I am certainly missing something here. You are talking about $491,000 up to $554,000 and you are talking about getting savings within the department. We are talking about spending an extra $63,000 in that one subhead. Maybe you did not explain it to me properly, I don't know.

MR. SMART: I am suggesting to you that the appropriate budgeted amount, the cost of running the executive section was $536,000 last year.

MR. J. BYRNE: Last year, that is right.

MR. SMART: We only budgeted $491,000. We had to assume we were going to realize the savings somewhere so we said, well, we will assume that we will realize the saving in Executive Support. We did not. No positions became vacancy. No one went off on maternity leave. No one left, so we did not achieve any savings. At $491,000 we under budgeted in Executive Support last year and had to transfer money in, up to March 31 of this year, just to pay the existing people we had. Next year we are not assuming that we are going to save any money in Executive Support, so we budgeted for last year's expenditure plus salary increases.

MR. LANGDON: Which is $18,000.

MR. SMART: Yes.

MR. J. BYRNE: Very good.

Transportation and Communications, $46,900 up to $52,700. That does not sound like a lot of money, but if you go through the whole Estimates it all adds up.

MR. LANGDON: It is about $5,000 more than what was budgeted for, but it is the same thing when you look at the cost of airline tickets for the executives when they go to meetings. There are deputy ministers' meetings, there are assistant deputy ministers' meetings, and the cost of travel has just gone out of wack all together. In my case, like last year, I think it was a couple of times I went out of town on ministers' meeting and that was it.

When the ministers' meetings are in Vancouver, for example, it is a long ways away and it costs more. This year, the ministers' meetings are in Prince Edwards Island so it would not cost you as much, so I guess when the budget is made up again, the boys who do all of this stuff, like Ken and the fellows, do not really know where the ministers' meetings are and, because of that, you see a bit of overrun and stuff like that.

MR. J. BYRNE: Especially if you have to go on short notice, type of thing, you pay through the nose.

MR. LANGDON: Yes, exactly.

MR. J. BYRNE: On page 224, I will get the same answer on salaries so there is no point in asking that one.

Under 03., Transportation and Communications, again $189,200 budgeted, $106,000 spent and $144,000 budgeted.

MR. LANGDON: We budgeted $189,000 and we spent $106,000, so we are under budget on that.

MR. J. BYRNE: Big time.

MR. LANGDON: This year the boys have put in about $144,100. Again, it is a budget item that hopefully, as I said, with the ministers' meetings in Prince Edward Island and so on, will not cost as much as it did last year out West.

MR. J. BYRNE: Under Supplies, you had budgeted $42,400 and $61,300. You are looking at $19,000, say. What would those supplies actually be, and why such an increase, a 50 per cent increase?

MR. LANGDON: Bob, do you want to handle that? I do not know what they would be.

MR. SMART: I am going to defer to Ken Curtis, our manager, if you want a listing of what exactly gets covered by the Supplies account. Is that your question?

MR. J. BYRNE: Just generally. I do not need a list as such.

MR. SMART: Ken, can you address that?

MR. CURTIS: Generally, this covers the purchase of miscellaneous supplies like pens, stationery and paper for photocopiers and just general office supplies, letterhead and items like that. This covers supplies for all of the staff at Confederation Building, so it is a fairly sizeable budget there.

MR. J. BYRNE: All the staff at Confederation Building. For Municipal Affairs or...?

MR. CURTIS: Yes, I am sorry, for Municipal Affairs.

MR. J. BYRNE: Okay, but it has gone up by 50 per cent. You would think, based on previous years, unless there was some abnormality that happened during the year or something - it has gone up by 50 per cent.

MR. CURTIS: The costs in this area tend to vary from year to year, and what we attempt to do is sort of budget what the average expenditure is going to be over a period of time. In this particular area we would not have seen a general increase over time so we just left the budget as is.

MR. J. BYRNE: Thank you.

The next one is section 1.2.02.12., Information Technology. You had budgeted $317,400, spent $353,000, and this year it is down to $258,000. Every year when I am at the Estimates meetings at any department, I always seem to hit on that one. There is a significant increase there from what was budgeted and revised, but there is a significant decrease for next year. Is there something that you did within the department this year with respect to computers or something that was not allocated or budgeted for?

MR. CURTIS: Not really. A lot of this relates to computer hardware and software, like a telephone or a calculator. In today's offices there is a constant need to turn that equipment over and upgrade it, when you have as much as we have. We will budget to replace as much as we can. We only have enough money to be able to budget $258,000. If we got to the middle or end of next year and we had savings in another account we might very well transfer it here and upgrade some of our other equipment. This is very much a question of whatever our budget permits, whether we will be able to invest in computer technology and in hardware and software, because it is extremely difficult to keep pace with it.

That is what you would have seen in (inaudible). We budgeted for a certain amount but when we got towards the end of the year we had a bit of slack somewhere else, so we put some money into upgrading some other equipment.

MR. J. BYRNE: Thank you.

On page 225, Support to Municipalities, you have Purchased Services, budgeted $152,800, spent $158,900, then you have budgeted $153,100 for next year. What would those Purchased Services actually be?

MR. SMART: Ken, you can perhaps - under Support to Municipalities, Purchased Services, $158,000.

MR. CURTIS: This line generally covers the department's office and rental costs in areas where we are renting office space. That is the bulk of this expenditure. Also, some small expenditures on equipment repairs, printing and similar types of items.

The revised is up slightly there because some equipment repair costs and equipment rental costs were higher than anticipated.

MR. J. BYRNE: This is office space across the Province?

MR. CURTIS: Yes, in certain areas where staff are not located in government buildings. It relates to the office in Corner Brook, the office in Gander and the office in the Avalon Region, in St. John's.

MR. J. BYRNE: Thank you.

Could I get a breakdown of that office space and how much you are paying for each one of those spaces, because I noticed - I am not sure if it is happening here. When we looked at the exceptions for the Public Tender Act, there are a lot of office spaces being renewed on a month-to-month basis rather than a year or two year lease type of thing. I do not know if any of these are happening. I would just be curious to see.

MR. LANGDON: I am not sure, but we will get the information for you. That is no problem.

MR. J. BYRNE: Okay.

CHAIR: The Deputy Chair has indicated he is prepared to defer to somebody else. I think what we should do at this point is defer to the government members' caucus room for a five minute coffee break because that is where the coffee and refreshments are. We would like the officials to join us.

MR. J. BYRNE: We will take ten minutes. Five minutes, we could hardly walk out there in that length of time.

CHAIR: Well, for those who are aged and slower, we will take ten minutes. Absolutely, Jack, we would not want to impair your trip.

SOME HON. MEMBERS: Hear, hear!

CHAIR: So we will meet back at 10:40 a.m.

CHAIR: Mr. Fitzgerald.

MR. FITZGERALD: Thank you, Mr. Chairman.

I will use some of my time just to stray a little bit away from facts and figures because I find those meetings are a good place to get questions answered and to find out information on department policy and the way things are happening with your own problems in your own district.

The one thing that I want to ask the minister about is not incorporation of communities but ‘disincorporation' of communities. It is an issue that I have raised every year since I have been elected here, ten years now. I have continually been trying to ‘disincorporate', if you would, because that is the wish of the people. Two communities in my district were incorporated back in the 1960s - that is Plate Cove East and Plate Cove West - the people in the communities there wanted no part of incorporation. In Plate Cove West they took over the main road leading through the community at a time when government subsidies and road component grants encouraged them, I guess, to reach out and use that direction as a source of revenue. Now they find that the road has deteriorated to such an extent that even the school bus operator threatens not to put his bus down over the road anymore to pick up school children.

Every winter it is a situation where we do not know if we are going to get the snow cleared there, or ice control looked after there, until we have the first fall of snow. Then, all of a sudden, somebody shows up. The Department of Works, Services and Transportation reaches an agreement with Municipal and Provincial Affairs and they do minor work so that they will not damage their equipment going out over that particular piece of road, and they look after the ice control and snow clearing.

Back a couple of months ago, maybe even longer than that, the department, I think, realized that those two communities cannot function any more and do not fit into - well, in the minds of the people there, they certainly do not want their towns to continue to be incorporated towns. They put forward notification of public hearings. Nobody came forward to attend the hearings so hence the hearings were cancelled. I made representation to the department and let them know what my views were on it, and the people's views as put forward to me. Ever since that, I have been trying to get information as to when a decision is going to be made. I have been unable to get that, so maybe the minister might be able to give me some direction today.

I know it is a bold step, and I know there might be risk involved, but I think it is about time. If we do not see something working and we do not see any way of fixing it, then maybe we will try to do the next best thing and allow the wishes of the people to be adhered to.

MR. LANGDON: I am preparing a Cabinet paper now, to go to Cabinet within the next couple of weeks, because the legislation says that Cabinet must approve the un-incorporation of the communities. I am bringing it forward to Cabinet. I cannot say yes or no, that it will not be done, but from my point of view we have the work done, we are bringing it to them to ask for the un-incorporation, I guess, or dis-incorporation, whatever the word - I did not look that up this morning before I came - but to your request the answer is yes, we have made a decision on that. We are going forward with it.

MR. FITZGERALD: Something needs to be done, and I will not take it any further. Obviously you have, and I commend you for that because those towns still have to survive. When they had a town council there, they could not even go out and have an acceptable waste disposal committee. Now, since the councils have been dissolved there, as far as being active, that part of it is working. They are saying that is all we want. Some of those communities probably should never have been incorporated in the first place.

Having said that, Minister, I look forward to hearing some positive results.

MR. LANGDON: I will be in touch with you personally on it, but from my point of view we are asking for it to be done.

MR. FITZGERALD: I know there is an old existing town council building there sitting in front of somebody's house, that has not been occupied, and there have been no utilities hooked up to it or connected to it for years. He is saying now: I want to get rid of that. We have to move out of here.

He has a nice piece of property, well-kept, and this dilapidated old building that the Department of Municipal and Provincial Affairs owns.

WITNESS: It will be done shortly.

MR. FITZGERALD: The other thing, Minister, I am a firm believer in incorporation. I believe that most municipalities can derive great benefits from it. It is a way to grow the community and to get benefits to provide to the residents of those communities. Sometimes I think we step out and we step up and do things in contravention of what municipalities have done and what they were led to believe in the past.

I think about the community where I live, Musgravetown, and I served on council there for a number of years and always promoted council and talked about the benefits to be derived from incorporation. When you see government, in their wisdom, stepping out and setting other examples of unincorporated communities - neighbouring communities where they go by and pave all the local roads. They provide them with water, not sewer, but with water. You see residents in incorporated communities having to go and in order to realize benefits, to see their taxes go up 100 per cent. I am wondering which direction government is moving in?

What we should be doing is setting examples of what good is in incorporation, rather than all the boogeyman that is involved in it by going to unincorporated communities providing all those services at no cost to the people who live there, and telling me and 700 people that if you want this benefit here than you are going to have to pay for it. Can you tell me the mindset behind that kind of a policy of your government?

MR. LANGDON: I certainly will. I am glad to take the opportunity to expand on that. When you think of - for example, Musgravetown, they had a heavy debt load. I do not know if it was there when you served on council or not, but that is one of the 150 communities where we did restructure their debt. As a part of the restructuring, of course, we are able to do some roadwork with them and so on.

One of the things that I have looked at, Roger, from an incorporation point of view is this, that many of the smaller communities need - incorporated communities I am talking about now. I will come back to the others after. They need a break, and we were able to do that in two ways, as I said, the debt relief. Take it from a personal point of view, if you are making a certain amount of money, for argument's sake, you are making $1,000 a month or take home pay, and $600 or $700 of that is for your mortgage. Well, you are so strapped because the debt service ratio is so high. I mean, where is the light bill going to be paid for? Where is the phone bill, and where are all of the other things going to be done?

What I have argued for, and have been able to have some success in, is to buy down, if you wish, the debt of many of the smaller communities. We have done that, and Musgrave Harbour was one of them. Now, if we buy down the debt, take most of the debt from them, then that particular town - like Musgravetown, for example - never, ever had within years a municipal operating grant because it was always intercepted by the Department of Finance. It is not a case anymore because we were able to work with them and bring their debt down. They can do some things within the town and act as a result of it. Then when water and sewer comes in, because as a result of their restructuring of debt, the councils have said we will pay. We have insisted you pay a dollar a day for water and sewer, and it is not a lot of money.

You take this glass here, if you went to any corner store you would pay $1.20 or $1.25 for it. Well, for that here you can flush your toilet, you can wash your clothes, you can bathe and you can shower, you can cook and do all those things for this here. I mean anytime you were to flush a toilet, people do not realize it, it would cost you about eighteen dollars. You just go in and flush because the water is there. They do not realize. That is for the unincorporated communities. We have said, whether it is in Paul Shelley's district in Burlington, or in Roger Fitzgerald's or whatever - like Trinity, we are looking to do some work down there. What we, as a government, have said, we will take up in the Canada/Newfoundland Infrastructure, which is one-third, one-third, one-third. Provincial governments have taken up 70 per cent, 80 per cent, 85 per cent or 90 per cent of the one-third that is by the municipalities so that if you were to do a million dollar job in a small community with very little tax base but they have decided to do the dollar a day for the water and sewer and $300 for property tax, a million dollar project will cost you $70,000. That is a way that we have been doing it.

Now, on the local service districts that you talk about right here, I have said within the department that when you come to look for dollars from a local service district and you are not paying any taxes like you say, whatever, we are saying we will do the project with you but we will do it on the seventy-thirty because taxes in your community, you can raise it the same as you can for Musgravetown, if the community is (inaudible) and you are not paying any, because it would not be fair, in a sense, to do ninety-ten to a community that pays no tax as you would for a community like in your district. You talk about Musgravetown, which pays $665 a year for water and property. What we are finding is that some of the local service districts at the beginning of it balked at it, they did not want to do it. When we looked at it and gave them opportunities to see where it was all going, they decided to come in and to work with us and to do it.

I agree with you. The thing is, being a member of the Federation of Municipalities for years, and on council, it does seem unfair that a council would have it and then everybody else get their roads paved for nothing. I am hoping that, through the Federation of Municipalities working with government, you might be able to find a way to get over it.

Like I said, Roger, your area was one that we talked about for Catalina and Little Catalina. We have 278 councils in Newfoundland; 151 local service districts and about 200 unincorporated towns, give or take. The population, the size of the City of Winnipeg. We are just administrated, in a sense, to death. Like in your way, I think it is a good start in Catalina when Darryl Johnson, who is from Port Union, and the other mayors look at it say, okay, we need a new piece of equipment for snow clearing. Well, you can probably buy one piece to do four communities rather than four communities buying a piece each.

Those are some of the things that we are looking at, and we are saying to them: Look, what is it that we have to do to make this work and use it as a pilot project to be able to do others? There is no way that I see it, that the small communities can afford to keep going on their own because eventually everything is going up and up and up. Somebody said to me, you do it in a bad time. No, I do not think you do it in a bad time. I think you do it in a good time.

It is like CBS, which Terry represents. They have not lost their identity. People still know that they live in Foxtrap, or Upper Gullies, or Manuels, or whatever the case might be, but the seven communities have come together to form one municipality, and we are encouraging it.

Today, for example, I probably would sign off on - because they came to me, the Town of Bishop's Falls, and said: We would like for you to do a study for us to see if it is feasible for us to become a part of Grand Falls-Windsor.

It is really positive and, while I am encouraging it, I do not want to enforce it, because if you force people into doing it people would dig in their feet and say: Who are you to tell me what to do?

I think, with encouragement, more and more encouragement over the next number of years, you are going to see the municipalities number smaller, but it will become that way because the people who live in the region, in close proximity to each other, say: Let us share.

Look at the Northeast Avalon, like Mount Pearl, St. John's, Paradise and CBS. They are sharing one water. They are sharing the same water, the same fire protection, the same waste management, so the more you share then obviously the more you can do for each region. That is the area now. Would I like to see it go quicker? Obviously I would, but it is only so far that you can lead people to do it. They have to see the merits of it, and I think they are beginning to see the merits of it as being encouraged by the federation. I think all of us realize that is where we want to be.

On the Northern Peninsula, up in Trevor's district - I was talking to Trevor only a few days ago - nine unincorporated communities and two incorporated are looking at one council. The thing about it is, from one end to the other is eighty kilometers but they are looking at one administration because they say: We are too small to do it on our own, let's see what we can do to share. Now, at the end of the day they might not be able to share a lot, but they might be able to share some things. If they do, then obviously it will be a cost saving service for them and provide better services to the people there.

CHAIR: Thank you, Minister.

That was a good tour of the Province after we got out of Plate Cove.

MR. FITZGERALD: I am almost afraid to ask another question.

MR. LANGDON: I won't go that long.

CHAIR: Your time is gone and his time is gone and Terry's time is gone.

MR. LANGDON: Mr. Chair, the thing is, it is fellows like Roger here for Bonavista North, who is out in the rural part of the Province, who knows the pros of this here and the value of doing it. When people like Roger has been so supportive of me in his area, I think that we, as a group of people, can make it happen by encouraging.

MR. FITZGERALD: The big difference with the approach that is being taken now is regionalization rather than amalgamation. The people themselves are coming and saying, we want it done, rather than the heavy-handed approach that your predecessors used, because people won't accept that.

You are right, Catalina, Port Union, Melrose and Little Catalina are a natural fit. They already share water services, they share garbage collection, waste disposal, they share firefighting, and I think the only hang-up there with the other municipality, Little Catalina, is the fear of losing their fire department.

MR. LANGDON: And that is not going to happen.

MR. FITZGERALD: They have to be given some comfort there. I think they have been given that, and that is why they are now coming back and saying: We want to look at that.

Unfortunately, there are a lot of other communities out there where regionalization and amalgamation cannot work. One has no more to give than the other. You take places like Keels and Duntara, there is not even one business in the community to provide a tax base. The only thing they survive on is collecting a poll tax from the people who live there. They contract out their snow clearing and that is the only activity that happens in the community there. I don't know what the future is for those communities, be it in the form of local government, or what we can do. If they amalgamate they have no more to offer, regionalized, than they have right now.

Elliston is probably another prime example where they have been struggling. I am surprised, although it hasn't been a problem, where you get people coming out and offering themselves to serve on councils. I was to a function the other night and the mayor of Elliston was there, and I said: What are you doing? He said: Boy, I am working but I haven't had a weekend off in the last month, working for council, repairing life stations, for no cost, because they do not even have the money to look after the infrastructure that they have there.

Minister, when we look at the infrastructure program, you are right. Thirty-three, thirty-three, thirty-three or one-third, one-third, one-third is certainly not acceptable for some of those communities. While it is a good deal, you only have to pay one-third, but if you cannot come up with the one-third then you might just as well offer them ninety-ten or whatever. The ninety being their part, because they cannot even come up with the 10 per cent. There is lots of need there. Maybe with communities like that we should look at 100 per cent funding for the things that are necessary there. I am talking about water, and to repair some of the infrastructure that they have in the ground.

MR. LANGDON: One of the other things is that I have argued - every meeting I have gone to, from the federal government point of view, they should do the same as we are doing because it is not only Newfoundland. I mean you are looking at Nova Scotia, Prince Edward Island, New Brunswick, Manitoba, Saskatchewan and the Territories. We need more dollars because of the way our population is spread out. If you are just going to do it on per capita - the Government of Ottawa announced, I think it was the other day, a new infrastructure program of $2 billion. That means $7 million a year for us for three years, $21 million. You cannot even put a water treatment plant in Corner Brook for that. That is a $35 million project.

It is something that we need to look at. So many, many times I have said - and probably we will look at it sooner rather than later. Probably another opportunity - like Peter Boswell did one time, he did a commission on government to do it again.

CHAIR: I am going to recognize - because we are well beyond the ten minutes that we have agreed to. Probably the only part of the Province, minister, where you did not take us is Shea Heights. So I am going to recognize Shea Heights now, and then I will recognize the Member for Conception Bay South, who also indicated he would like to speak. That should just about round out the tour, I would say.

Tom.

MR. T. OSBORNE: Thank you, Mr. Chair.

MR. LANGDON: Sorry about that. I did not mean to leave out Shea Heights, you know that.

MR. T. OSBORNE: Oh, that is alright. You can make up for it by some handicap accessible units. I do not mind.

MR. LANGDON: I will get after those for you.

MR. T. OSBORNE: Page 227, under Engineering Support, there is $102,000 increase in Salaries under Engineering Services. I am just wondering if -

MR. LANGDON: What line is that, Bob?

MR. T. OSBORNE: Yes, 2.3.01., Salaries.

MR. LANGDON: Water technicians. We are hiring some new technicians - that we put in the budget last year saying we would - to help smaller municipalities to test water and bring services to them.

I will just say this to you, Tom. One of the things we are looking at, we have not gone as fast as we would like but in smaller communities rather than having one community with a water technician, we have four or five communities, again, in a geographical area, one technician or two technicians to look after four or five water systems and then share the cost out with the four or five communities. Again, it is numbers but the Federation is supportive of that move as well. So that is where that is.

MR. T. OSBORNE: They were announced in last year's budget and only implemented this year?

MR. LANGDON: I would think they were -

MR. SMART: Yes, it would have been implemented before but you are seeing the full annualized impact of it this year. We would not have had all of those positions up and running. We, in fact, got some of these up and running but the people we had were so good they got hired away to the Department of Environment. So we had to advertise again. You are seeing the full annualized impact here of us having these positions in place for all of this year, where it was only part of next year.

As you will notice when you look at last year's, the revised expenditure under this salary account is down from budget because we did not get the positions in place because we had to advertise and go through the Public Service Commission; and there was a bit of staff turnover. These are very technical people and, in fact, hard to hold onto quite frankly.

MR. T. OSBORNE: When did those positions become filled?

MR. SMART: I will defer to Wayne Churchill who has these positions in his division. Water technicians, Wayne.

MR. CHURCHILL: They were filled initially as we had intended but what happened, as the deputy said, the minute we had them filled we lost two of them. They went on to bigger and better things, so we had to start over again. The process takes a fair amount of time to hire somebody through the interview process. That is what happened.

In one case we had one of them that we have only now replaced. What happened is that when the position was filled it was filled internally which left a lower position, but it also meant that one of our guys went elsewhere on the basis that he could come back. He went elsewhere within government on a temporary position. He could not tell us when he was coming back, so we could not do up the proper ad to get anybody to apply for the position. That is the reason why there was a position vacant for almost all of last year.

MR. LANGDON: (Inaudible) people into actual positions. You announce it but then when you have to go through all of the rigamarole with the internal, with the service commission and with the union, bumping rights and all that type of stuff, it takes a long time to do it.

MR. T. OSBORNE: How many water technicians are there now in the Province?

MR. CHURCHILL: There are three. There is one in each of the regions on the Island. The West Coast person also substitutes for Labrador.

MR. T. OSBORNE: Previously there was one?

MR. CHURCHILL: Previously the position did not exist. There was none.

MR. SMART: These positions were created. (Inaudible) new positions. These are the positions we have. They are also on staff at the Department of Environment. They can address that themselves but these new positions were added as part of the (inaudible) the tap water strategy that the government announced last year. Part of that strategy was to put us in a position to provide more assistance to municipalities in being able to test their water and so. There are other parts of that strategy which relate to the Department of Environment but this was our piece, along with our disinfection assistance program.

MR. T. OSBORNE: Under 2.3.02, Industrial Water Services, there is an increase in the amount there for Salaries as well, from $136,000 under the revised last year to $164,700. I was wondering if you could elaborate on that?

MR. SMART: There is no substantive change of any nature in the staffing of that particular section which runs a number of systems that we, as the department, still own around this Province. All you are seeing there is the impact of salary increases, the fact that savings may have been realized there before that will not get realized this year. I mean it is just the to and fro within the salary budget of the department really. There is no change in staffing levels, no increases, no reductions.

MR. T. OSBORNE: So, just an increase in salaries paid?

MR. SMART: Well, an increase compared to the amount we actually spent last year but not an increase in relation to - this is one of these areas, as I mentioned earlier, when you look at our budget you will see some accounts where our salary expenditure was budgeted at a certain amount last year and it went up. This is one of those ones where we budgeted salaries in here at $152,000 and it went down because we did realize some savings. When we look at 2003-2004, this is not an area where we are anticipating vacancies or any savings in our salary account, so we are anticipating to budget at the normal operational level. They may realize savings there again and our revised expenditure could be down, but that is not what we are anticipating this year.

MR. T. OSBORNE: Okay.

How would you realize savings, Bob? The number of employees remains the same.

MR. SMART: We would realize a saving - it is basically a vacancy factor. We budget in a division. We have ten people. The budget is ten times whatever their salary is - let's say it is $500,000. Now, in terms of balancing our salary budget, we will know that there is a vacancy somewhere in the department and we may assume that a position may become vacant this year. If it does become vacant, given the process we have to go through with the Public Service Commission and the collective agreement to fill it, it would quite likely be vacant for three, four or five months. So we would save $20,000 or $30,000 on a vacant position before we even got around to filling it; or, in some cases we may look at the position and say: Let's think about whether we need to fill this at all, depending on the service level requirement.

Generally it is normal staff turnover, people retiring, people resigning. We may have people in temporary positions that we had on for a special project and their employment expires and we do not replace them. There are any number of factors.

You will also see situations in some accounts where, when people do retire and we do pay out severance pay, you will see that reflected in salary account. So we sort of, in effect, pay the salary for the full year for the person and if they retire near the end of the year we have to pass out another extra twenty weeks pay in severance pay. That will drive up some of these accounts.

There are any number of reasons, which is why I made the point earlier that in terms of salary budgets in the department we focus more on the total for the department than we do on particular subheads, because it can go up and down for any number of reasons.

MR. T. OSBORNE: Okay.

Under Purchased Services, the same heading, the revised amount last year was $570,000. It is now $668,800. What would -

MR. SMART: The big item there is hydro increase. These industrial water systems that we own are users of electricity, and when hydro rates do increase we feel the brunt of it. What you are seeing there is a rather significant adjustment, actually, in the hydro rates charged against these types of industrial systems, which is not - they are treated differently than your normal domestic usage. We are in a separate category. I do not know the details of it other than we took a bit hit in our electric bill for next year because of a hydro rate adjustment. That is mostly what that is. There is general inflation there as well, obviously.

MR. T. OSBORNE: Under municipal financing, subhead 3.1.01., Debt Expenses, the revised amount last year was less than what was budgeted and it is up again this year. I am just wondering if you can give an explanation on that.

MR. SMART: Yes, this reflects the interest portion. When we do capital projects, what you are seeing here is the amount that we pay to the Newfoundland Municipal Financing Corporation for capital projects we have done in the past. Our financing is arranged through the Newfoundland Municipal Financing Corporation.

If you look straight across, on to the next page, this is the interest portion of our debt, the same as when you pay your mortgage. You pay so much towards interest and you pay so much towards principal. If you look straight across on that other page, you will see that the principal portion of our debt to NMFC and you will see that the principal portion is down - or the interest portion is down while the principal portion is up.

These exact numbers are determined based on the capitalization, the principal and interest rates, on a whole series of loans related to a whole series of capital projects. It is not unusual at all that in any given year, depending on what is happening with interest rates, depending on what is happening with refinancing and capitalizations, that our actual interest expense, or principal expense, will go up and down based on financing factors.

This reflects our debt payment on capital projects we have been undertaking for ten years. Some of this payment relates to a loan we took out ten years ago, that will become due this year, and it is paid off, and it will be replaced by a loan that we took out last year to do another capital project last year.

There are hundreds and hundreds of individual loans tied up in these numbers and, as interest rates and so on fluctuate, that is what affects these numbers. We really have little control over this. It is likely the Department of Finance would say to us at some point in the year, given what is going on with interest rates, given what is going on with refinancing, you guys are probably going to pay more in interest this year than in principal, so we changed things around.

MR. T. OSBORNE: They always reflect - if the interest amount is up, the principal will be down, and vice versa?

MR. SMART: It can, yes.

If we ran into a situation where a number of loans that we had taken out eight or ten years ago at a very low interest rate were now maturing and had to be renewed, and given today's interest rates they had to be renewed at a much higher rate - if we took them out for 5 per cent and we could only renew them today at 10 per cent - the same as doing your mortgage, depending on where you get caught when you go to renew after the term, whether the interest rate is up or down, we could see our interest rate going up or our interest expense going up, if interest rates have gone up. If we took out loans back in the 1980s when interest rates were high and we go to refinance today when interest rates are down, we would see savings in the interest account.

As I say, it is like taking 1,500 loans and trying to figure out the principal and interest payment on all of them, and putting it in, knowing full well that 300 of these are coming up to term this year and have to be renewed. We can never be exact. I do not think we got this perfectly right yet, because of the number of variables involved. Generally, one is up and the other is down, or the other is down and this one is up.

MR. T. OSBORNE: Under 3.1.03., Special Assistance, obviously those grants would not fall under the MOGs. Grants and Subsidies last year went from slightly less than $5 million to slightly more than $16 million. I am just wondering what those special grants were for, and why such an increase.

MR. SMART: Special grants, just to focus on the $4.8 million for a moment, covers some very broad territory. It covers grants to volunteer fire departments for breathing apparatus, it covers grants to community service groups that provide various services in various communities around the Province. In a lot of these areas it is community groups that actually provide the town hall through the Lions Club or something of that nature, so we do pay out grants to those groups as well. So, it is a very broad list of groups and municipalities and volunteer fire departments that get supported out of the $4.8 million.

It took a significant jump up to $16 million in our revised expenditure due primarily to two things. One is the job creation program which the government introduced, which cost upwards to $4.6 million. That gets funded out of this account. The other big item that is funded out of that account is the relocation of Great Harbour Deep, which cost upwards to $6 million. That is why you are seeing the big spike in the revised expenditure.

We would expect, barring some other unforeseen circumstances, that it would go back to its normal level of $4.2 million or $4.3 million this year; but we could have a crisis of some sort, in which case we would have to look at putting some more money in, but we are not budgeting for a crises.

MR. T. OSBORNE: So, the job creation program that was in place last year, you are not anticipating the same level of program this year?

MR. LANGDON: In the Budget, we did not budget for job creation last year. We are not budgeting for it this year either, but if it comes then we will have to get a special warrant through special assistance to make it happen.

It is the same thing with Great Harbour Deep. There might be another community out there that will be asking us to relocate. I think there is one on the Northern Peninsula that Trevor was dealing with. There are three or four houses - I forget the name of the community - and there are eighteen kilometres you have to snow clear to get to three families in a small community, and I think Trevor was saying to me that they want to move. So, if we get a letter from them saying they want to do it, then - we do not have it budgeted in but we would have to go and get a special warrant to make it happen. That is why, as Bob said, that is spiked there. That is what it is. I cannot anticipate it because I do not know.

MR. T. OSBORNE: Okay.

MR. LANGDON: But, all things being equal, it is levelled out. You will not see $16 million there unless we have another Harbour Deep or we have another job creation program.

MR. T. OSBORNE: Under 3.2.02., the Canada-Newfoundland and Labrador Infrastructure Program, under Grants and Subsidies there, compared to what was actually spent last year and what is being spent this year, there is a significant jump. I am just wondering if you could elaborate on it.

MR. LANGDON: I will just go briefly into it, and then I will ask Bob to do it.

One of the biggest problems we have when we do, say, the Canada-Newfoundland Infrastructure Program, is the time it takes to get the projects approved. It is long and almost - I do not know the word I want to use for it, but here is the situation: When I get a project approved - let's say I am going to do a water and sewer down in Pouch Cove, in Jack's district - once it has been signed off by the federal minister, then it has to go to ACOA, and ACOA has to look at it. Then it has to go to the Canadian Environmental Assessment Agency and they assess it. The thing is, I would like to speed it up.

When I got here the first year, I said: Well, we can do that. I will contact the people in Halifax and they will speed it up for me because I am the minister here.

It does not work that way. It is tedious, it is long. I will give you an idea. We could have done twice as much as we did last year. We could not do it. You just cannot get the approvals out in time to make it happen.

What we did this year is, I had all of my work done, pretty much so, by the fifth of February, and gave it to the federal minister. I am waiting for it to get back so we can announce it. So, if we get it started early in the year, rather than start the water and sewer in Pouch Cove in October, I can get it done in July or August, when it is a good season, get good tenders and get good prices.

That is primarily it, Tom. Like I said, it is frustrating. I am sure that for everybody who was here before me it was the same thing. It is not trying to delay it. We want to spend it.

I will just give you one more example, Mr. Chair. We had a situation out in Salmon Cove, Victoria, where the sewer was on the beach. I think it was the Canadian Environmental Agency that said: Look, we are going to fine you so many hundred thousand dollars a day if you do not get this done. We made it a priority to do it because we were asked to. It took about six months before we finally got the answer back to do it, so it is very frustrating.

CHAIR: Thank you, Minister.

Tom, if you don't mind, your colleague, Terry, has asked -

MR. T. OSBORNE: I just have one more question on that.

MR. FRENCH: One question. Okay, if you have one more.

MR. T. OSBORNE: With the almost $11 million in the grants last year that was not spent, that was budgeted for, if with our general rule of thumb it is a use it or lose it type of thing, before March 31, what happens to that amount? Where does that go? Does it go back into general revenue?

MR. SMART: In this account here? You will notice if you look down lower, there is a federal revenue here. This is the federal contribution towards the Canada-Newfoundland Infrastructure Program. What we don't draw down from the federal government stays there. It is just simply a cash flow.

MR. T. OSBORNE: Okay. So if you don't use it this year, it is there for next year.

MR. SMART: I mean, the federal government is in the Canada-Newfoundland Infrastructure for $50 million over a five-year period. If we don't use it this year, we will use it next year. It doesn't disappear at the end of the year, no, not on the Canada-Newfoundland Infrastructure or on Municipal Capital Works either. That is a rolling amount of money, we will say.

CHAIR: Thank you, Tom.

I am going to recognize Terry French, and we will be happy to go back to you or anybody else who wants to intervene.

MR. FRENCH: Thank you very much.

I have a couple of policy questions, I guess. I guess we can stray from the actual numbers and feel free to ask what we like.

There is a situation that developed in Conception Bay South a couple of years ago whereby the municipality at the time went into people's bank accounts. I don't know if you guys are familiar with this. It became an issue, certainly, with the town and eventually it was reported to the Ombudsman who was going to investigate that issue. He went to the department and I believe he has been stonewalled at the department, to use somebody else's words, and he cannot seem to get the answers. Yet, he has been down that road on other issues with municipalities and has had no trouble.

Is there some problem there as to why he cannot investigate that?

MR. SMART: We have had a number of files with the Citizen's Representative that we have dealt with quite expediently, and brought them to a quick resolution with a great deal of cooperation. With respect to municipalities, the Citizen's Representative - I don't know if the particular case you refer to was in fact one of them, but the Citizens' Representative did come to us with complaints or investigations he wanted to do with respect to decisions made by municipalities. We did say to the Citizens' Representative that, as we read the legislation for the Office of the Citizens' Representative - and there is a whole list of legislation attached to his act which are things he has jurisdiction over. It was our view that the Municipalities Act, the City of St. John's Act, the City of Mount Pearl Act, and the City of Corner Brook Act are not legislation which are appended to the legislation for the Office of the Citizens' Representative. So, yes, it is our view - well, not just our view, it is our legal interpretation that the Office of the Citizens' Representative does not have jurisdiction to deal with matters relating to decisions made by municipalities because that legislation which governs those municipalities is not appended to his act. Now, if and when it does become appended to his act, we would say: Yes, we will assist in this regard. But he lacks the jurisdiction, in our view, and based on our legal advice.

MR. FRENCH: Yet, he hasn't had any problems with other issues?

MR. SMART: Well, the other issues - he came to us, for instance, on issues with respect to how we settled some claims in Hurricane Gabriel in St. John's. People who did not get their claims settled in the manner that they thought satisfactory, he came to us on those issues. Hurricane Gabriel is handled through the Emergency Measures Organization which is part of our department and governed by the Department of Municipal Affairs Act which is appended to his legislation. So we said sure, and we cooperated with him; gave him all our files. With his assistance, to the credit of his office, we were able to settle a few issues that we could not settle on our own. So it was quite beneficial, but on the issue of municipalities, he simply lacks the statutory jurisdiction to go into it.

The other comment I made to the Office of the Citizens' Representative - when I said to him that he lacked the jurisdiction - is: If you are going to go down the road of entertaining complaints against the over 400 town councils and local service committees in this Province, and they are going to become a matter in which you want to have jurisdiction, that is going to take up a lot of time. I mean there are over 400 local governments in this Province when you talk about towns and local service districts. So his point: Did we cooperate? No, it was our view that it is not a matter. It is a municipal issue between a municipality and its taxpayers. It is not a matter that he has jurisdiction to deal with. Now should someone rule later that we are incorrect in our legal interpretation and he does have jurisdiction to deal with it, well then we will deal with it and we will cooperate on these files the same as the others.

MR. FRENCH: Yes, I see what you are saying, but if you want to go down the road of municipalities, it is one thing to be upset that your road was not paved before someone else's but it is another thing when you actually go into someone's bank account. I think there is a big difference there personally. Would the department investigate something like that?

MR. SMART: On the matter, no. I mean these are matters that, in our view, are matters between the taxpayers in Conception Bay South and an issue they have with the Conception Bay South council. That particular case, I think there was even some court action on it which dealt with some of this in terms of whether the hookup charge was legal and so on. Would we get involved in whether it is legal for a bank to take a deduction against someone's bank account? We would have to say to the person -

MR. FRENCH: It is not a bank it is the municipality.

MR. SMART: Well the municipality, in this case, made a deduction from an account that the taxpayer is suggesting the bank should not have let the council do. We would say: Taxpayer, maybe you have an issue with your bank.

MR. FRENCH: That is half the problem.

MR. SMART: It is at that level. It is not really a policy issue. It is a municipal issue that we would not get involved in.

MR. FRENCH: The other thing I was going to ask you - again, in Conception Bay South you currently have an infrastructure agreement signed with the Town of Conception Bay South - I believe it is for $18 million, somewhere in that ballpark. My understanding of it is that they come to you guys with a list of their priorities. If you guys agree, naturally you sign a document agreeing that this is the way the money will be spent. Has it ever been the case or could it be the case that they could come back and change some of their priorities?

MR. SMART: That would not be an issue with you people at all, I would not think. It would not mean the loss of that money or anything for the town. They could easily change, for example, a community centre to water and sewer money, or water and sewer money to pavement, depending if the need was there.

MR. LANGDON: The idea is, when we do the multi-year capital works, they are the priorities that the town has deemed priorities, so we do not say to them: You cannot do this. You have to do that.

We do not do that. We sign off. Now, if after year one the council comes back and says, what we thought was a priority here we would like to change, we have no problem - if they decide to do it. We will not do it to them without them coming to us. That is right, isn't it, Bob?

MR. SMART: I would just like to put one caveat on that, because Conception Bay South and Portugal Cove, St. Phillips and Paradise, all of whom we have these agreements with, there are certain aspects of their multi-year plans that, if they did come to us and wanted to change, we would say no. Those aspects relate primarily to water issues, because Paradise, Portugal Cove, St, Phillips, CBS, draw upon the same regional water system as St. John's and Mount Pearl. They are all hooked into Bay Bulls, and there are certain things such as reservoirs in Paradise, reservoirs in CBS, that we would insist -

MR. FRENCH: Or if there were treatments or something of that nature.

MR. SMART: Yes. If they came to us and said, we would like to take this money off and put it into paving, we would say no. If they wanted to take it off something else that we did not consider essential to the regional infrastructure, we would be okay with that.

MR. FRENCH: Thank you.

CHAIR: Thank you, Terry.

Are there other interveners?

Deputy Chair?

MR. J. BYRNE: With respect to Municipal Infrastructure again, section 3.2.03.06., Purchased Services, you budgeted $7.5 million, you spent $3.1 million last year, and this year it is up to $8.7 million. What are those purchased services, and professional services above it, under .05 and .06? We have two there.

MR. LANGDON: It is pretty much the same thing as it was for the Canada-Newfoundland infrastructure. What happens is - go ahead, Bob.

MR. SMART: These relate to infrastructure projects being done in Labrador communities under the Labrador agreement. All you are seeing there, really, is an expectation under both accounts, professional services and purchased services, which are being used to make payments to contractors for various types of projects, be they projects on buildings, water and sewer projects and so on.

We had an expectation in 2002-2003 that we would spend a total of about $8.9 million or $9 million on both because, as the minister pointed out earlier with respect to the Canada-Newfoundland infrastructure, the same thing happens here. You run into delays, particularly in Labrador where you have a short construction season. If you do not start at a certain point you will be delayed in the completion of your project, so we had a substantial amount of slippage and our revised expenditure was down and we will pick it up again next year. We will carry over. We will start a bunch of new projects, plus we will carry over what we did not finish in the previous year. It is a cash flow item in terms of, we can only spend it so fast.

MR. J. BYRNE: With respect to professional services and purchased services, the professional services, would that be like engineering design and what have you, and then the purchased services would be the actual installation?

MR. SMART: Yes, that would be a good definition, I think. For this type of account, yes.

MR. J. BYRNE: Emergency Planning, section 4.1.02.07., Property, Furnishings and Equipment, you had budgeted $239,300, spent $232,500, and $13,300 for next year. What would -

MR. SMART: Actually, if you looked at Property, Furnishings and Equipment there, and just up the page a little bit to Supplies, you will see the same thing, significant expenditures in 2002-2003 and not in 2003-2004. What that reflects is the investment we made last year in our HAZMAT initiative, which is to acquire about ten trailers that we will equip with chemical spill gear, HAZMAT suits, things of that nature, and distribute them around the Province in strategic locations to deal with chemical spills on highways.

A lot of this flowed out of the reaction after September 11. The federal government was prepared to do an arrangement with us to put these trailers and equipment in place. What you are seeing in 2002-2003 is the purchase of trailers and the purchase of equipment, but that is done now and we are in the process of rigging them all out, so you do not see the expenditure in 2003-2004.

MR. J. BYRNE: How would you determine where those are going to be placed?

MR. SMART: Down by the Fire Commissioner.

MR. J. BYRNE: The Fire Commissioner's Office.

Disaster Assistance, 4.1.03.07, Property, Furnishings and Equipment. Again, $2 million budgeted, $2.6 million spent, $3.3 budgeted for this year. Is that in connection with what you just explained?

MR. SMART: No, what you are seeing in terms of 2002-2003 is the finishing up of expenditures with respect to Hurricane Gabriel in St. John's and the settlement of claims and so on. What you are seeing in 2003-2004 is our initial provision to deal with the Badger flood. I mean that number, by its very nature, this is an area where it can go up or down, depending on the nature of the disaster.

You will also see as well, if you looked at the Federal Revenue in that account, you will see we are actually making a $2.1 million profit on this account this year. What all that reflects is a lot of the money the federal government owes us with respect to Hurricane Gabriel, we are not actually going to receive. We have spent this, which you are seeing in our expenditure account, but we are not actually going to get our money back from the feds until this year, which is why you see a big revenue item there.

MR. J. BYRNE: Just a couple of other questions - and you touched on this earlier, minister. This is with respect to the situation with Harbour Deep, the relocation of Harbour Deep. You mentioned a small community - three houses up on the Northern Peninsula. Are you planning on putting a program in place to address these concerns or just as it comes to you, as it comes type of thing?

MR. LANGDON: We are not asking - Harbour Deep, for example, I would think that they were probably there when Mr. Chair was there asking for the same thing; probably even for years. It finally came to - when I met with the mayor, he said: Look, are you or are you not? We have gotten three plebiscites in the community, 100 per cent of the people want to leave. That is the only way that we are doing it. If, for example, we have the three or four houses down in - I forget the name of the community that Trevor was telling me about. It will come to me later on - but if there are three families and only one wants to move, then we are not going to move one and leave the other two there.

MR. J. BYRNE: It does not make sense.

MR. LANGDON: It does not make sense. But, we are not initiating it, it is coming to us. Once you have 100 per cent of the people in a community and they do two or three plebiscites, and they come to you and say: We want to be moved. Then I think it is incumbent on whoever is in this chair to have a look at it, but we are not initiating it.

MR. J. BYRNE: What would happen if four or five communities came forward and said: Okay, we have 100 agreement. We want to move three houses, ten houses, twenty houses or whatever the case may be?

MR. LANGDON: I guess you would have to look at it, and from government's point of view I guess, that we do not anticipate it but if they did we would have to look at it. We would look at the cost of what it would be, for example, if you were living in an isolated community, to transportation for ferries, what it would cost hydro for diesel, what it would be for the school, what would it be for health and all these types of things. You would examine it all when it comes to you at that time, but we are not getting a large number of people coming that way.

MR. J. BYRNE: One other thing, this concerns - and I am doing this from memory now - debt retirement for the municipalities, that program you had. I remember after the budget - Randy Simms, is he the President of your Federation? He was saying, basically, that program is -

MR. LANGDON: It is not, and the thing about it is that - in the budget, what it said was we have about twenty-eight communities still, that are there, and we want to look at and evaluate these communities. We are prepared to help those twenty-eight like we did the other 150. I mean, you could not do (inaudible) any good conscience.

MR. J. BYRNE: There was no money actually budgeted for that.

MR. LANGDON: I know that, but the thing is, when we go in and find out how much we need it will be the same situation as Special Assistance - like you would for Harbour Deep, you would have to come forward with a warrant to pay these particular dollars but we have every intention of helping the other twenty-eight communities. Why it was not there is because we do not know how much it is going to be, three or four or five. When we find out, then that is the amount of money which will be coming forward.

MR. J. BYRNE: That is it for me, for questions.

CHAIR: Are there any other interventions?

MR. FITZGERALD: I would just like to have a (inaudible), Mr. Chairman.

I would like to go back to 3.1.03, Special Assistance, page 228, Grants and Subsidies. I think, in answer to a question that was put forward by my colleague from St. John's South, you indicated that part of this money which was revised, the $16,304,900, was for the job creation projects. Did you say how much was spent in job creation?

MR. SMART: It was $4,650,000, give or take a couple of thousand.

MR. FITZGERALD: Could we get a list of the breakdown of where that money was spent per district?

MR. LANGDON: Absolutely.

MR. FITZGERALD: Okay, because I would like to see it and -

MR. LANGDON: Absolutely, I have no reason why not to do that.

MR. FITZGERALD: Well it is common knowledge, I guess, anyway.

MR. LANGDON: Absolutely.

MR. FITZGERALD: Okay, if you would be so kind.

The other question that I would like to ask - and I understand that there is an amount of money and there is a time frame. It is an issue in a lot of rural areas where you get people living in an unincorporated community working in an incorporated community. For example, people driving from maybe Bloomfield to work in Port Blandford, or Bloomfield to work in Clarenville. What is the amount of money and what is the time frame? Because I understand there is both, whereby that municipality would have the right to charge a poll tax to that individual because they work in their community.

MR. SMART: Other than - and I may have to get back to you on this when I confer with our people, but you can only confer a poll tax on residents within your municipal boundary. If I were a resident of another community and actually had a business establishment - if I lived in Bloomfield and had a business establishment in Port Blandford, well sure, Port Blandford could charge my business establishment the business tax. Municipalities can only charge a poll tax to residents of the municipality.

MR. FITZGERALD: Well, it may not be called a poll tax but it is an amount of money equivalent to a poll tax, where a person living in an unincorporated community is charged on a regular basis because they happen to work in an incorporated community.

MR. SMART: I have never heard of it. Unless it is a case where - the ones that we are familiar with are: you live in an unincorporated community and we do charge your unincorporated community a fee for access to the dump site and for fire protection services. Is there a particular location?

MR. FITZGERALD: Yes, it is common knowledge. It has been there from - well, I served on council back in the 1980s and it was a common thing then. If I am living in - and I will use Bloomfield because it is an unincorporated community. If I work in Clarenville or if I work in Port Blandford, then that council imposes a tax on me because I happen to have earnings from that community. I know there is a time frame there, that if you work less than so many days you are exempt from it. I think the basic exemption is, you don't have to pay if you make less than the basic exemption. In that basic exemption, not only the money that you earn while working in that incorporated town is considered, but the money that you collect by drawing EI, because being able to work there is considered as well.

MR. SMART: Maybe I will ask Baxter Rose, our ADM. He seems to know. I have never heard of it before, but maybe Baxter can -

MR. ROSE: There is a threshold of ninety days. If you live in an unincorporated community and work in an incorporated community that has a poll tax system in place, if you work ninety days in that community you can be charged a poll tax. The exemption that you refer to on the basis of income is, if you are living in an incorporated community and you are subject to poll tax but your total income for the year is less than the basic personal exemption for income tax, then you can be exempt from the poll tax.

If you live outside of an incorporated community but you work in an incorporated community for ninety days or more, then you have to pay the poll tax.

MR. FITZGERALD: That was my understanding as well.

The other question is: Would one outweigh the other? If you made more than the basic personal exemption and you worked less than ninety days, would you be exempt then?

MR. ROSE: If you work less than ninety days you are not subject to poll tax.

MR. FITZGERALD: So, either one of those. You must be both of them in order to pay poll tax in incorporated communities.

MR. ROSE: The exemption on the basis of income is, if you live in an incorporated community and are subject to the poll tax. If I were living outside an incorporated community and I was working in an incorporated community that had a poll tax and I worked there for more than ninety days, then I would be automatically subject to that poll tax.

If I live in the community that has the poll tax and I earn less than $7,426, then I would be exempt from it.

MR. FITZGERALD: It causes some confusion. In fact, I had one individual who was living in an unincorporated community and was a truck driver who would go into an incorporated community to pick up his supplies in the morning and then go out on his route, down route 235, and the Town of Clarenville was charging him a poll tax because he happened to go to Clarenville that day to pick up his supplies - being paid by an employer in St. John's who was paying a business tax in Clarenville, but this individual, because he went to Clarenville to load from a warehouse to his truck in the morning, was sent a poll tax. There are all kinds of shady areas there, where -

MR. LANGDON: (Inaudible) did not know it existed. I really didn't.

MR. FITZGERALD: It has been around for a long time.

MR. SMART: It is news to me, so I learned something this morning that I did not know before.

CHAIR: I would say there is a bit of work there for the Citizens' Representative.

MR. FITZGERALD: I would think so.

When a community implements a town plan - a lot of the bigger communities have it - that has to come to the department for approval?

MR. SMART: It has to come to the department for registration. Essentially, the way we do this: A town submits its plan to us with its zoning and so on and so forth, and unless we have some significant provincial interest in terms of objecting to some part of it - if, for instance, they zoned part of a provincial park for housing development, we obviously have a provincial interest in not letting that happen; but, assuming we have no significant provincial interest, our only role is to register it. Now, that is a little bit different than approval.

WITNESS: (Inaudible).

MR. SMART: Well, he has to register it. He cannot say, I do not agree with it just because I do not like it. If he does not agree with it, he has to demonstrate that, we have a significant provincial interest in this and here is our significant provincial interest. If he cannot demonstrate that, no, his only role is to register the plan for the municipality.

MR. FITZGERALD: If there is a contravention of that town plan, and an individual wants to appeal some process that has happened there, how do they do that? Do they do that to the town, or do they do that through Municipal and Provincial Affairs?

MR. SMART: I will ask Baxter Rose, who is responsible for urban and rural planning, on the technicalities of how you, in fact, get before an appeal board and what the steps are. Baxter?

MR. ROSE: If an individual is appealing a decision coming out of a town plan, there is a regional appeal board that individual can make application to with regard to decisions of the council that affect them, arising from the town plan.

MR. FITZGERALD: Those are independent individuals who serve on a regional appeals board that make the decision?

MR. ROSE: Yes, they are.

MR. FITZGERALD: And those decisions are final and binding?

MR. ROSE: Those decisions are final.

MR. FITZGERALD: Thank you.

CHAIR: Thank you, Roger.

Sandra Kelly wishes to intervene.

MS KELLY: Thank you.

I am wondering if the 9-11 money, remember the Province spent several millions of dollars when that situation occurred, and I think we did an exemplary job in responding to it. I understand that the federal government had said, in some way, shape or form, that they would help with this response. We had submitted the bill for it, for their share, what we legitimately thought was their share. Did that money ever get paid after? I know it was a long time there, but has it been paid since?

MR. LANGDON: No, we have not gotten a penny. They have not reimbursed us for it. We have, in a number of ways, tried to put in an alternate plan, like the $2 million - if they do not want to give it to us outright - that we spent, we said, well, why can't you do a special arrangement for us for firefighting, that we can improve the firefighting facilities of communities around? They have said no to that too.

MS KELLY: The other question I had was the $3 million that is allocated to Badger in this budget. Is that a part of the federal-provincial disaster relief program?

MR. LANGDON: The way that it works, Sandra, is this: The Province picks up the first $550,000. From $550,000 to $1.47 million, it is fifty-fifty between us and the feds. From $1.47 million to $2.65 million, the feds pay 75 per cent and we pay 25 per cent. When it goes over that threshold of $2.7 million then the feds pick up 90 per cent and we pick up 10 per cent because it is a federal program.

MS KELLY: I hope it does not take them as long to pay those bills as it did the others, or that they will pay.

MR. LANGDON: The thing about it is, the minister has said - Gerry Byrne, when I was in Badger - that he would take it to the equivalent of the Cabinet, I guess, Executive Council, to approve it, but we have not gotten it in writing yet that they are with us. We know that they will.

MS KELLY: The only other question I had was around the infrastructure program and how difficult it is to get the federal government to keep to a good timeline, especially considering we have such a short construction season here.

I notice that this program is a three-year program. I know the money does not go away if it is not spent before March 31, but what happens after the three years? If it is not spent after three years, does it disappear then? If they keep being as slow as what they are, we are not going to have the $90 million spent if they do not put a better system in place.

MR. SMART: There is generally a cleanup year on these federal-provincial agreements. You can go on twelve months past the expiry of the agreement to use up the funds. We will make sure that they have sufficient projects well in advance that we will not drop any money under Canada-Newfoundland infrastructure.

CHAIR: Thank you.

Eddie Joyce.

MR. JOYCE: I would like to just take one minute, Minister and staff, to congratulate the staff. I know I deal with the staff in the Corner Brook and St. John's offices. I do not like those people who are pretty aggressive and always nagging municipal affairs, but I must commend and congratulate the staff in St. John's and the staff in Corner Brook.

Just to give an example, and just to go on record, there was flooding in Cox's Cove last night and Cyril McCarthy, the regional engineer, got up from his supper and went to Cox's Cove to help out the town. That is the kind of dedication that we get from your department, and I just want to go on record as saying that I know a lot of municipalities that I deal with on the West Coast, in particular the Bay of Islands, are very appreciative of the services that they get from your department.

MR. LANGDON: Thank you.

CHAIR: Thank you, Eddie.

Seeing there are no other interveners, I will call the heads.

On motion, subheads 1.1.01 through 4.2.01 carried, without amendment.

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

CHAIR: Thank you.

I think that is about it, Madam Clerk.

Thank you very much, Minister and officials, for your attendance and diligence to answering the questions.

For the benefit of the Committee, we will reconvene here tonight at 7 o'clock to examine the Estimates of the Department of Government Services and Lands.

MR. LANGDON: I just want to, in closing, say a big thank you to the Chair and to the Committee members. If at any time we can help, you know where we are

CHAIR: Thank you.

On motion, the Committee adjourned.