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

MR. HUTCHINGS: Good morning, everybody; we will get started.

I welcome everybody to the first Estimates for the Social Services Committee.  This morning we will be hearing the Estimates for the Department of Municipal Affairs.

First off, I will turn it over to the Clerk who will do a nomination for Chair.

CLERK (Ms Murphy): Could we have a nomination for Chairperson?

MR. RIDGLEY: I nominate Keith Hutchings, the Member for Ferryland.

MR. CORNECT: Seconded by Tony Cornect.

CLERK: All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CLERK: Contraminded?

Carried.

CHAIR (Hutchings): Thank you.

We now call for nominations for Vice-Chair.

Could I have a nomination for Vice-Chair?

MR. KEVIN PARSONS: I nominate Marshall Dean.

CHAIR: Could we have a seconder?

MR. RIDGLEY: Seconded.

CHAIR: Seconded by Mr. Ridgley.

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

It is carried unanimously.

Before we begin, there are just a couple of items.  When I go to the minister for comments, there will be fifteen minutes for the minister, if he wishes to use that.  Before he does that, I would ask that his staff identify themselves; as well, when you are speaking during the Estimates, each time, if you could identify yourself for the benefit of Hansard, if you are involved in the discussion. 

Normally, proceedings will rotate about fifteen minutes for those asking questions.  That is not set in stone, but we will certainly go on that premise: fifteen minutes back and forth. 

Fifteen for the first and then ten following?

CLERK: (Inaudible).

CHAIR: Okay.

With that, I will go to my right first and ask people from the Committee if they could identify themselves, please.

MR. YOUNG: Wally Young, St. Barbe.

MR. RIDGLEY: Bob Ridgley, MHA, St. John's North.

MR. CORNECT: Tony Cornect, Port au Port.

MR. KEVIN PARSONS: Kevin Parsons, Cape St. Francis.

MR. DEAN: Marshall Dean, The Straits & White Bay North.

MS MICHAEL: Lorraine Michael, Signal Hill-Quidi Vidi.

CHAIR: Thank you very much.

We will ask the Clerk to call the first heading.

CLERK: 1.1.01.

CHAIR: Shall 1.1.01 carry?

With that, I will go to the minister for any opening comments and, first, maybe if your staff could identify themselves.

MS BARNES: Sandra Barnes, Deputy Minister of Municipal Affairs.

MR. MERCER: Cluney Mercer, Assistant Deputy Minister, Engineering Services.

MS MCCORMACK: Marilyn McCormack, Assistant Deputy Minister, Fire and Emergency Services. 

MS GULLAGE: Cheryl Gullage, Public Relations Specialist, Fire and Emergency Services.

MR. MORRISSEY: Good morning.  Ken Morrissey, Communications Director.

MR. JONES: Good morning.  Scott Jones, Departmental Comptroller.

MS NORMAN: Paula Norman, Executive Assistant to the minister. 

CHAIR: Thank you.

Minister.

MR. O'BRIEN: Good morning, everyone.

I am happy to be here after Budget day yesterday and being first up in Estimates; I feel blessed to be questioned first.  I have been only in as the Minister of Municipal Affairs for the last five months or so, it has been actually a great process for myself.  I have really enjoyed Municipal Affairs up to this point, interacting with the municipalities across Newfoundland and Labrador, mayors, councils, and all the stakeholders thereof. 

As I found with all of our travels through the Province, especially since the first of January, we are all really working towards a common goal: viable, sustainable municipal services for the people who we serve.  The councils and mayors serve the people who they have been elected by within their municipalities.  I, as the minister, have the same mandate, along with my staff, to really support those municipalities in their vision and their work in regard to having a very viable and sustainable municipal service, making for strong local governments and strong communities.

The Department of Municipal Affairs delivers a number of services and programs which ensures that people can enjoy their towns, sustainable communities, and also being supported by strong local governments.  The department also supports the municipalities from a financial position as well, trying to make them viable, which was reflected in yesterday's Budget, and I am sure we will get questions in regard to that as we go forward here this morning.

We endeavour to meet the infrastructure needs of the municipalities.  We have great challenges there and great need there.  This year alone in regard to Municipal Capital Works, I have about $700 million worth of ask, which is phenomenal across the Island.  As I viewed personally each and every application, in my opinion, each and every one of them was a need.  As we move forward, we have to address the higher needs that I see and we see as a department, along with the participation of the municipalities, to move those infrastructure needs forward and address them as we go into the future.

I will not go over the structure of Municipal Affairs across the Province, but we all know that we have regional offices outside of St. John's in the Central Region in Gander, Corner Brook, and Happy Valley-Goose Bay.  They interact on a daily basis with the municipalities that are encompassed within their region.

We have had a number of initiatives we have been working hard with in the Province with regard to the fiscal framework.  Since I got there in October, it became a mandate of mine that I wanted to understand the fiscal framework completely in regard to Municipal Affairs.  Certainly, I wanted to understand the formula that was derived back in 1992 with the Municipal Operating Grants, which is quite complicated.

As I stated earlier, we had a one-time bump in regard to Municipal Operating Grants, giving me a year to work out another more viable, I guess, or reflective - would be the better word - formula on a go-forward basis for municipalities in Newfoundland and Labrador.  That one was developed back in 1992.  It is a good formula and it may very well stay the same, but we are going to explore other items that we might want to bring into the formula and also items that we might not want to use in the formula.  So, we will go through that process and see what we come out with.  We will consult with municipalities and also with MNL in regard to that.

We had an unprecedented event in Newfoundland and Labrador back in 2010, and that was Hurricane Igor.  I was very proud of our staff, not only in Municipal Affairs but primarily in Fire and Emergency Services in regard to how we responded to that unprecedented event.  The work happened very fast.  We were ahead of the game before the storm even hit.  In the meantime, we have responded very well to those people who not only lost their homes but lost, in some cases, all of their family possessions and their history.  With that, I commend my staff in regard to Fire and Emergency Services as well as Municipal Affairs in the way we responded to that event.

We also responded to the needs of rural Newfoundland and Labrador in regard to how they faced employment challenges over the last year with the Community Enhancement Employment Program of $8.5 million, which saw 304 projects with 2,200 workers who were assisted in achieving EI status.  We also, through the Fish Plant Workers Employment Program, had expenditures of somewhere around $570,000 through three projects and assisted sixty-seven workers who had been displaced by permanent closures of fish plants in their town. 

Also, shortly after I became minister I was personally involved in the transition of all the communities, Fogo Island to a new community called the Town of Fogo.  It was certainly a pleasurable experience.  I think that community, that Island itself has great opportunity now, good new footing, and on a go-forward basis they should be able to design their own destiny.  They have opportunity there with growth; the economy seems to be doing very well.  I was very proud of our staff in all the work that was done previous to me becoming minister and also in regard to the particular mayors and councils across Fogo and how they handled the transition as well.

In regard to initiatives, Municipal Affairs, we have our Municipal Operating Grants, as I just mentioned.  We have a one-time increase of $4.6 million into the Municipal Operating Grants which will increase the total allocation to $22.4 million from somewhere around $17.4 million or $17.2 million I think it is.  We will go over the breakdown with regard to the municipalities and what they received if you want.  If you have any questions on that I would be ever so glad to answer those questions.

Fire and Emergency Services; I also took a very active role with regard to Fire and Emergency Services, which I should as the minister but in the meantime it was dear to my heart as I travelled through Newfoundland and Labrador and saw volunteer firefighters, met with volunteer firefighters and understood exactly what they were trying to do and the great work they were doing within their community.  Not only in providing that service when needed, God forbid when we need it, but they are there at a minute's notice when a community would need that type of service but they also provide other services as well.  We all recognize that fire halls and those organizations are the cornerstones of communities all across Newfoundland and Labrador, so we saw fit in this year's Budget to increase our total investment to fire trucks to $3.9 million this year, along with $1 million to be used for new equipment, personal equipment such as bunker suits and that kind of stuff.  We have a total budget of $4.9 million.  We will be moving through this - one of the other things that was highlighted in the Budget yesterday was the $1.36 million tax credit that firefighters can now avail of. 

Municipal capital works; our total provincial investment for this year, which includes new and ongoing projects, will be a total of $140.8 million.  When you add in all the contributions federal, as well as ours and the municipalities, we will have a total investment of $219 million this year.  Along with our funding for municipal infrastructure, we have also committed a $30 million block funding for recreational and multi-purpose facilities. 

When I was assigned to Municipal Affairs and I looked at the total ask in municipal capital works and carving out the ask in recreational and multi-purpose facilities, I firmly believe that I could not address those issues out of municipal capital works.  As we all understand, municipal capital works is primarily for water and waste water.  That is the primary focus in those infrastructure needs, but also recognizing that to make our communities viable and vibrant they also require recreational multi-purpose facilities as well.  I was really happy to have that block funding, the $30 million, to address those needs. 

Provincial Solid Waste Management Strategy is moving forward.  I am quite pleased with the work that has been accomplished so far.  To date, since 2008, we have after this year, approximately $121 million invested in the Solid Waste Management Strategy.  The total investment in new dollars this year is going to be $14 million, primarily spent in Robin Hood Bay and in Central, some in Labrador as well. 

The Flight 491 memorial, $400,000 has been dedicated to that initiative.  We will be moving that forward this year in consultations with the industry and also with the families who were affected by this tragedy as well.

I think I have given a little bit of an overview in regard to Municipal Affairs, what we do and what our goals are in this upcoming year.  There is always lots of work to be done within the department.  Municipal Affairs is a very dynamic department.  We interact on a daily basis with not only councils but people's lives across Newfoundland and Labrador.  Certainly, I see Municipal Affairs and the staff – and I commend them once again, along with Fire and Emergency Services.  We try to work solutions to each and every need of municipalities that may come forward on a daily basis.

With that, I am open to any questions with regard to this year's Budget.

CHAIR: Thank you, Minister.

We will now go to our committee.

MR. DEAN: Marshall Dean, The Straits & White Bay North.

I would like to say, first of all, I am really appreciative of all the time we had to prepare for this after the Budget.  If the eyes look a little baggy this morning it is because we have been trying to get through this.  Anyway, nevertheless, I am sure we did not have control of that.

I would just like to acknowledge the staff and the work they do with the municipalities, also the MHA offices and other things.  Quite frequently, I know my CA calls into some of you and you are very co-operative.  I would just like to acknowledge this morning that it is appreciated.  It is good to be able to go get information whether we are trying to help someone with a file or just trying to find information for them, or find direction of where either a municipality, a local service district, or some group and go with something in terms of funding and programs.  I would like to acknowledge that this morning and thank you for it.

What I would like to do, in my first lot of time, is to just go to line items, Mr. Minister, and make some comments.  You or your staff can answer questions or make notes, whatever the case may be.  Some of it is just over differences in funding from last year to this year, just a little detail around that and some other things will be more significant.

I will start on page 255, and I guess that is the Budget document page, so I am not really sure.  We are in section 1.1.01 if that helps you folks better.  The only thing there, it is actually in section 1.2.01 under Executive Support.  It looks like we have probably added another individual into the differences of salary from the Budget last year to the revised.  Going forward we are carrying the same number.  Probably you could give us a little detail or explanation as to why the difference in that line.  Line 01 we are looking at.

MR. O'BRIEN: You are looking at 1.1.01.01., correct?

MR. DEAN: 1.2.01., line 01.

MR. O'BRIEN: 1.2.01?

MR. DEAN: Yes, it is under General Administration.

MR. O'BRIEN: 1.2.01.01.  Number one, the increases also reflect in the 4 per cent salary increases 2011-2012.  Also, we had a severance payment for a retired employee.  The ADM's secretary retired, so we had a severance package there, too, that we had to pay out.

MR. DEAN: Okay, good.

Section 1.2.03, again under Salaries; this year we are basically on budget, for all intents and purposes, 2010-2011.  In 2011-2012 we are looking at a $200,000 increase.  Can you give us some idea of what changes would be there? 

MR. O'BRIEN: Yes.  We restructured the department in regard to the financial management section.  You are talking about 1.2.03.01., correct?

MR. DEAN: Yes, correct.

MR. O'BRIEN: That reflects a restructuring that we - we restructured the Administrative Support to show the two divisions.  In regard to previous years it was not clear that the divisions were separate, so we changed it.  That just reflects and it will be picked up in the other heading.

MR. DEAN: Okay.  The increase there would be a decrease in other departments?  I noticed some in 1.2.02. 

MR. O'BRIEN: Yes, if you go up to the one ahead you will see the increase; that is reflective of the other one previous. 

MR. DEAN: Okay.

MR. O'BRIEN: We restructured the division to show the administrative one.  At one point in time, if you look at the Estimates of last year you will see Administrative Support and the Strategic Financial Management section was all in one.  Now we divided it out where it is easier to understand.

MR. DEAN: Okay.  Basically, it is somewhere around the same in that case, is it? 

MR. O'BRIEN: Yes, and it is part of the government-wide restructuring program.

MR. DEAN: Okay.

If we go to section 2.3.01. Engineering Services, in line 05. Professional Services, we had budgeted $78,000 and the actual revised was $377,000 and we are back to the same budget for this year.  Can you speak to that?  That might have to do with Igor.  I am not sure, but anyway.

MR. O'BRIEN: 2.3.01.05?

MR. DEAN: Yes.

MR. O'BRIEN: Up from $78,000 to $377,000?

MR. DEAN: Yes.

MR. O'BRIEN: Okay.  That actually reflects an increase of funding from early design initiatives, and that also was because of the restructuring of the divisions, correct? 

MS BARNES: Most of the department's work is put out through Grants and Subsidies because the municipalities pay for it.  From time to time we will have projects that the department will undertake, as an example, the water system in Trinity Bay North.  When we engage the consultants directly on those, it does not flow through the municipality and it has to be paid through Professional Services as opposed to Grants and Subsidies, so it is just a restatement.

MR. DEAN: Okay, thanks.  Also keeping in that same section, if we come down to line 10 Grants and Subsidies, there is nothing in there for this year.  We were a little under budget last year.  We had $3 million, we came in at $2.5 million, and this time we do not have a figure in there.  Obviously, that has shifted somewhere I would assume.

MR. O'BRIEN: That is a part of the restructure as well.  We shifted into municipal capital works.  That is –

MS BARNES: 3.1.01 and 3.2.02.

MR. O'BRIEN: Yes, 3.2.01 and 3.2.02.

MR. DEAN: Okay.  What would have been covered there, just normal municipal Grants and Subsidies?  Is that correct?

MR. O'BRIEN: Yes.  When we restructured we actually shifted the engineers from the administrative side into the municipal grants side.  It was better in regard to the services that we were delivering to the municipalities, so then we shifted everything over to reflect that.

MR. DEAN: Okay.  I am just trying to understand why there would be Grants and Subsidies in the engineering department, if I could call it the engineering department, or Engineering Services?

MR. O'BRIEN: It is not Grants and Subsidies but it is for early design work.

MR. DEAN: Okay.  So it is more Professional Services?

MR. O'BRIEN: Yes, but it was in municipal capital works.  There is already design EDIs done on big projects such as waste water and that kind of stuff.

MR. DEAN: Okay, that is good. 

Move to the next section then, 3.2.02.  If you could give us some explanation under the Amount to be Voted, item 02. Revenue - Provincial is showing a credit I guess or whatever.  Can you explain that, what exactly or how that is –

MR. O'BRIEN: 3.2.02?

OFFICIAL: 2.3.02?  That is the Industrial Water Services. 

MR. DEAN: Yes, 2.3.02 and then under the Amount to be Voted, there is a line there 02. Revenue – Provincial.  Is that the revenue that comes in against the actual expense?

OFFICIAL: We are just trying to get the right heading.  Is it 2.3.02?

MR. DEAN: Yes.  Is that what I said?  2.3.02. Industrial Water Services, the very next section from Engineering Services.

MR. O'BRIEN: That is your revenue derived from industrial water systems.  We have an issue in regard to Trinity Bay North and OCI.  There is a dispute.  We have discussions ongoing with the company and also with Trinity Bay North in the collection of those fees.  That is the reason.

MR. DEAN: Okay, all right.  So we did not collect from those companies?

MR. O'BRIEN: We did not collect from OCI.

MR. DEAN: Okay.  We are going back in with the same figure anticipating that we will resolve that kind of thing throughout the year.  Is that the intent?

MR. O'BRIEN: That is correct.

MR. DEAN: Okay, all right.  I have just one more question and then I will give the Member for Signal Hill-Quidi Vidi an opportunity.

In the very next section, 2.3.03, under Urban and Rural Planning, I am basically looking at the total for Urban and Rural Planning.  We are seeing a decrease in the Budget for this year down from $690,000 to $551,000.

Can you give us some idea generally of why that budget would be down for that particular piece of the department?

MR. O'BRIEN: We had various decreases all the way along, as you can see in regard to the budget and the revised budget.  You have seen a decrease down – wait now, let me get this right.

OFFICIAL: Salaries and Professional Fees.

MR. O'BRIEN: Yes, Salaries and Professional Fees.

MR. DEAN: There are two or three lines there, Salaries, Transportation and Communications, and Professional Services are all down.  Is there any reason?  Is that part of the restructuring?  What would be the explanation for it?

MR. O'BRIEN: Okay.  We have a wind down really in the Labrador Inuit Settlement Area plan.  We are to the end of that now.  The draft is done, so there will be a $40,000 decrease there, roundabouts.  We have had a delay in filling some vacant positions as well, but we have them in the queue now in regard to the hiring process.

We do have lower than anticipated travel, and that is also to do with the Labrador Inuit Settlement Area plan as well.  We have some budget reductions in supplies, also to do with the Labrador Inuit settlement plan, on wind-down of that particular plan.  It is mostly all reflected there.

MR. DEAN: Thank you, Mr. Chair.

CHAIR: Ms Michael.

MS MICHAEL: Thank you very much, Mr. Chair.

I will do line items, but since we are into 2.3.03, I do have a couple of general questions – where we just were in the Urban and Rural Planning.  The line item questions have been asked, but with regard to the Urban and Rural Planning, I am just curious about what is happening to the land use policy and an update on the Avalon and the Humber regional plans.

MR. O'BRIEN: We have been quite active regarding the Urban and Rural Planning Act.  As a matter of fact, we have three appeal boards for that act.  The Eastern one has just been reappointed.  Well, I should clarify that, it has not been reappointed with the same members because under the legislation they can only serve for two years, then we have to reappoint again.  We are in the process of reappointing the Central appeal board as well.  We follow development across Newfoundland and Labrador, and the purpose of that act is to make sure that when development happens, it happens in an orderly fashion, it reflects certain issues that might arise across Newfoundland and Labrador regarding the aesthetics of how that particular development may look, keeping that in mind, and also reflecting some of the issues surrounding the particular communities.

The plan itself, the Urban and Rural Planning Act, certainly reflects if you went down through the actual act itself, there has been – how do I word it?  You are asking me: How are we planning to use land in Newfoundland and Labrador?  In regard to that act, it clearly defines how a development would happen, and how we would address those issues with ribbon-type development and all those kind of good things that would increase the need for infrastructure and that kind of stuff.  That act actually guides us in that development process.  As I have mentioned earlier, if there are any issues surrounding that in regard to a person who might apply for a development or a piece of property that falls within that area covered by that act, well then they would go to an appeal process. 

Also, there are other departments brought into the process in regard to any development that might be considered by government such as Environment and Conservation, such as Government Services.  We all interact together in making sure that we have development in an orderly fashion across Newfoundland and Labrador.  As you know, Lorraine, we see in the past that people just put up homes wherever they wanted to put up homes and that kind of stuff way back when.  That is one of the reasons why and the thrust of the Urban and Rural Planning Act that defines exactly how we would address that area. 

In regard to having an overall plan that we are only going to have development here and development there, there is no real plan to that.  This is a huge Province and it would be hard to do.  We take guidance from the legislation so then we look at each and every application.  Certain areas are defined under that act across Newfoundland and Labrador and if it falls within that area, well then we apply the guidelines that are in the regulations and also in the act itself.

MS MICHAEL: Basically, you are saying it is sort of is a case-by-case basis, decisions made according to certain criteria but no overall land use plan itself with particular goals and aims, et cetera.

MR. O'BRIEN: Yes, well there are two regional plans ongoing –

MS MICHAEL: I was asking: Where are they, the Avalon and the Humber?

MR. O'BRIEN: Yes, they are ongoing; we are working through the details in regard to those plans.  There have been discussions within the department with those particular people; that is ongoing as well.  We will hopefully have them finished probably within the next number of months or so (inaudible) –

MS BARNES: (Inaudible) speak to it.

MR. O'BRIEN: Yes, if you want to add to it.

MS BARNES: With respect to the Humber Valley plan, the draft plan was released for consultation back in January.  The planning committee now is in the process of consolidating the input that it has received.  The next step for that will be the release of a plan with a commissioner to hold hearings, after which it would come forward to the minister for adoption or changes, as per the process.  We expect that will take several months.  One of the challenges they are grappling with, of course, is when they can release.  It is difficult to release it, say, over the summer months.  You want people to have the opportunity to provide feedback.

The NEAR Plan, the Northeast Avalon Regional Plan, there has been a number of meetings.  There was a draft background report that the fifteen partnering municipalities needed to get together.  Needless to say, there are quite divergent views and we have been working co-operatively through that process.  As late as two weeks ago, we met with the consultants.

The department has taken a fairly active role in trying to bring this together and make sure that everybody's views are in the draft document.  So, we are working with the consultant on another draft of that background report.  Hopefully, we will have that in a position soon to go back to the fifteen member municipalities because we need their agreement in order to put it out for consultation.

MS MICHAEL: Thank you.  That is very helpful.  I know the Northeast Avalon is really complex.

MS BARNES: Understandably so.

MS MICHAEL: Yes.

MR. O'BRIEN: With that, you cannot move them ahead too quickly either.  You have to address it, so it takes several months.  So we anticipate having them well along, though, by sometime in the fall.

MS MICHAEL: It sounds like the end of this year, maybe.

MR. O'BRIEN: Yes.

MS MICHAEL: Thank you.

Okay, I will come back now to some line items.  I will not repeat anything but I did have more questions under 1.2.03. Strategic Financial Management, I notice under Salaries we have an increase in salaries.  You can speak to that one first, Kevin.

MR. O'BRIEN: Yes, the increase in salaries reflects the 4 per cent again for 2011-2012.  Also, there was an unanticipated severance payment for a retired employee in there.

MS MICHAEL: Okay.  Under 02. Employee Benefits, knowing what employee benefits usually stands for, what would make the jump to $12,000 for this year?  It looks like maybe a one-time thing.

MR. O'BRIEN: No, that is a re-profiling in the budget from the Administrative Support division again.  That is where we divided the two.  So you have the Administrative Support and then you also have the Strategic Financial Management piece, so that actually is the re-profiling of that budget.

MS MICHAEL: For employee benefits?

MR. O'BRIEN: Yes.

MS MICHAEL: Okay.

Transportation and Communications has gone up, too, this year.  Is it the same thing?

MR. O'BRIEN: The same reason in regard to the re-profiling.

MS MICHAEL: And the Supplies also.  That is the answer all the way through that section is it?

MR. O'BRIEN: All the way through that section, yes.

MS MICHAEL: Okay, great.  Thank you very much.

Just let me move ahead then.  I have myself confused now, where I went backwards.  Just give me one second.

2.2.01. Policy and Strategic Planning.  Salaries, there was a revision downward last year.  What would have caused that?

MR. O'BRIEN: Salaries is a decrease which reflects the removal of a temporary contract position.  The duties are now being filled by a different person.  The savings there is due to that vacant temporary position, but the duties have been re-profiled to another person.

MS MICHAEL: Okay.

MR. O'BRIEN: That was a temporary contract position.

MS MICHAEL: Okay, thanks.

Under 05, Professional Services, do you just maintain a line there even if the money is not spent?  Because last year you had $20,000 but you did not use any of it.

MR. O'BRIEN: That is Professional Services?

MS MICHAEL: Yes.

MR. O'BRIEN: Yes, that is a consultant cost.  We did not use it, but we just keep it there.

MS MICHAEL: Okay.

MR. O'BRIEN: Yes, it varies from year to year.

MS MICHAEL: Right.

What was the expenditure under Property, Furnishings and Equipment?  You did not budget anything but you had $12,000 expenditure.

MR. O'BRIEN: That is scanners for TRIM.

MS MICHAEL: Okay, thank you.

We did not do this one did we, 2.3.01?  No, right.  Under 2.3.01 – did you answer that already?  You did because I have taken notes.  You asked that one did you, Marshall?

MR. DEAN: Yes.

MS MICHAEL: Yes, that is right.  I have taken notes on that.  That is where I got confused and there is where we ended.  Okay, now I am on track.  I am sorry about that.

Under 3.1.01.

MR. O'BRIEN: 3.1.01?

MS MICHAEL: Yes, the Grants and Subsidies.  This is Municipal Debt Servicing.  It is going down significantly this year by about, almost $3 million.

MR. O'BRIEN: Yes, it is, and it will go down each and every year.  I think there was about $200 million, $225 million that was left to be paid out in Municipal Debt Servicing.  We now pay everything in cash.  On a go-forward basis in regard to the municipal capital grants we pay everything in cash now.  Over time that will go down to zero.  So you will see a decrease each and every Budget.  The debt financing was up to $220 million-odd left to pay out in the debt finances of 2007. 

MS MICHAEL: Okay.

CHAIR: Ms Michael, do we want to –

MR. O'BRIEN: We anticipate that it is going to be paid out by 2020, total.

MS MICHAEL: By 2020 it will be all paid out?

MR. O'BRIEN: Yes.

MS MICHAEL: Okay.

CHAIR: Ms Michael do you want to take a break and we will go to somebody else?

MS MICHAEL: Sure, thank you very much.

CHAIR: Marshall.

MR. DEAN: How about we just go down to the next section from where the member just finished off, 3.1.02.  We know the increase is in the Budget of $4.6 million, is that correct?  Roughly, approximately, I believe that is what was announced. 

I am interested in a little bit of discussion on this, Minister.  It is our first increase we have had for seven or eight years in Municipal Operating Grants.  We know it is in as a one-timer and obviously, municipalities are pleased with that.  They would be, for very obvious reasons.  Is this one-time commitment to increases going forward even though the formula may need to be worked out or we do not know what the formula will be?  Can municipalities expect this increase to stay? 

MR. O'BRIEN: Yes, this increase reflects this year's Budget.  You will see an increase from $17,836,600 up to $22,450,000 which is reflective of the $4.6 million one-time increase.  If I could break that down for you before I get into further discussion on it, is that we have in the Province 271 municipalities along with five Inuit communities as well; 209 municipalities will receive 50 per cent of that particular $4.6 million which reflects the $2.3 million –

MS BARNES: It is 50 per cent.

MR. O'BRIEN: Yes, 50 per cent of the current 209 municipalities, if I word this correctly, will receive a 50 per cent bump in their current municipal operating grants.  In other words, to clarify that, if they were receiving $10,000 yesterday, this year they will receive $15,000.  Just to be clear, because there was some confusion there yesterday.  In regard to that one, which are municipalities of 1,000 and less -

MS BARNES: Less than 1,000.

MR. O'BRIEN: Less than 1,000 and that will reflect $2.3 million.  There are forty-two municipalities in the next category, which is from 1,000 up to 3,000, and that is 30 per cent of their current operating grant of $1.1 million.  Then there are sixteen in the 20 per cent category and that would reflect $627,000.  Then there are nine in the 10 per cent category which are the bigger urban places, such as Gander will be in one of them, and that will reflect $653,000.

There was a lot of work done since I began, and it was ongoing I guess and started just prior to me getting shuffled into Municipal Affairs, but I became really involved in it in regard to my own point of view in understanding the municipal operating grants and the formula that was developed back in 1992.  I took it on myself to educate each and every minister personally.  We did a number of presentations to all ministers to make sure they understood the formula and understood the reasons and the background behind municipal operating grants because I thought it was really important for all ministers to understand that formula.  If you are going to have a vibrant Newfoundland and Labrador well then you have to have vibrant communities.  Communities have challenges in their overall operating expenses and their operating financial lines, so I thought it was really, really important that we get this and get it right.  That work is still ongoing.  We are going to have a look at the formula itself, as I said previously in my opening remarks.  We are going to see if we can develop a new formula on a go-forward basis that would reflect where we are today as compared to 1992. 

The components of that particular formula may change, the components may stay the same, I do not know, but I am a person who always believed, and always had believed, that you should evaluate your programs.  It has been in place since 1992.  Does it reflect today's standards, is what I would question.  We would give that bump -

MS BARNES: We are waiting on (inaudible).

MR. O'BRIEN: Yes, and we are also waiting as well - my deputy minister just reminded me that Dr. Wade Locke is also doing a piece of work for MNL in regard to identifying new revenue streams that municipalities may very well be able to avail of.  As you can see, I thought we should give the bulk of the money to communities that do not have the opportunity to create new revenue streams as compared to an urban centre such as Gander.  They have a lot more opportunity than the smaller communities. 

To answer your question Marshall, this will stay in place.  This will be the base we would look at as a starting point once we have the new municipal operating grant formula developed. 

MR. DEAN: Okay.  Just to be clear, would municipalities expect - because you know what it is like, if you give them an extra 50 per cent there are plenty of good things to spend it on.  I guess they would probably have a few questions of what to do with it in terms of taking it long term.  Are we doing anything that might require them making commitments out past their fiscal year?  Can they assume, for want of a better word perhaps, that an operating grant similar in amounts will continue to flow through?  Is that correct?

MR. O'BRIEN: I do not anticipate any changes to the municipal operating grants going down.  I would look at this as being a base going forward.  I will be advising municipalities in their operations to reflect that increase.  I have seen, especially in the smaller communities, their biggest challenges are their overall operating on a day-by-day basis.  This will give them the opportunity to do that. 

As well, to be quite frank here, as I travelled through Newfoundland and Labrador, not that I am and this government is promoting amalgamation, we are not, but we are also promoting partnership and co-operation between municipalities to look outside the box in regard to sharing services.  We have been advising them as well on that, because I have to make sure they are viable, I have to make sure they are vibrant and that is my mandate.  This is only a part of it, to make it more sustainable for the future.  

MR. DEAN: This new fiscal framework for municipalities, when do you see that coming in place?  I know it has been several years and probably several ministers who have been working on it.  I know there was a question asked on it last year and it is coming forward kind of thing basically.  Realistically, when can municipalities expect to see that? 

MR. O'BRIEN: I anticipate having a new formula, if there is to be a new formula, completed before the end of this fiscal year.

MR. DEAN: Okay.

MR. O'BRIEN: Hopefully, I am still the minister and I can implement it.

MR. DEAN: We will insist that you stay there, if that is going to be the case. 

Another question, you mentioned Dr. Wade Locke's report, have you seen a copy of that, no?

MR. O'BRIEN: No, we have not.  It is not completed yet. 

MR. DEAN: Okay.

MR. O'BRIEN: They anticipate it will be completed within the next few weeks.  Hopefully, we will have that in draft form within the next couple of weeks.

MR. DEAN: Okay.  The smaller communities, I have several local service districts in my district and there are differences of opinion as to where they stand in terms of financial support.  The reality is they are small communities with very little income and a lot of infrastructure concerns, primarily around water and sewer.  Most of these places do not have it.  If they have it they are on a boil order at best for water and so on.  There is really no plan to do anything with that.  Where do you see their future in terms of government's role in helping those communities and funding them or whatever? 

MR. O'BRIEN: I believe over the life of the past government, actually since 2003, in the first Budget in 2004 and on a go-forward basis we have been trying to support smaller communities across Newfoundland and Labrador.  As a matter of fact, I would venture to guess that the total in regard to infrastructure investments, I would think that 40 per cent to 45 per cent of the total investment made in Newfoundland and Labrador since 2004 Budget has been made in rural Newfoundland and Labrador.  The challenges are great, the needs are great. 

One of the other pieces we addressed was the cost-shared ratios.  Back in 2008, I believe there was a 50-50 share.  Now we have the formula, as you know, 70-30, 80-20 and 90-10.  That enabled smaller communities to now avail of some of that infrastructure money, but my challenge is great as well.  As I said in my opening remarks, I have $700 million worth of ask, and you know what my budget is to my commitment authority.  I have to try to stretch that to meet $700 million worth of ask. 

We try to be innovative in our department.  If we cannot help the smaller communities in their 10 per cent, if we cannot have 100 per cent, fine.  Under the legislation they have to come up with their 10 per cent, but with the project at hand, be it water or water and sewer, we will try to do it in phases.  We will try to do whatever we possibly can to enable the community over a period of time to complete the project they see as an absolute need for the citizens they serve.  So, we are being innovative in regard to Municipal Affairs.  We are asking the communities to be innovative as well and think outside the box, and then we will move it forward.

MR. DEAN: Okay.  I want to ask one other question.

CHAIR: Okay, yes.

MR. DEAN: That is on section 3.1.04. Community Enhancement program; I have to say again, when you talk about your ask I am sure the ask is much more than you budgeted.  Last year you were at $4.5 million, and you were successful in getting another $4 million, and we have gone back to the $4.5 million again this year.

MR. O'BRIEN: That is correct.

MR. DEAN: Given the need that was there last year, why would we take that figure back?

MR. O'BRIEN: Well, that is our base budget.  The $4,543,600 is our base budget, and each and every year as you look back at other budgets that is the base budget each and every year.  We evaluate the need on a go-forward basis.  It depends on issues and challenges within the fishery; that is also reflected in there as well. 

Each and every year, when we get to that time of the year we are going to address those needs.  Then we evaluate, along with the Department of Fisheries, to see if there is more of a need across Newfoundland and Labrador.  We all work from a base budget, but then in the last number of years we have increased that by significant amounts.  Last year it was somewhere around the $4 million range, and I think the year previous to that it was probably in the range of maybe $7 million or $8 million because the need was higher.  That varies from year to year.  To put it up at $8 million and leave it as the base, then we could leave it at that but it varies.  So, why not leave it at the base of $4.5 million and we will deal with it as we evaluate the need across Newfoundland and Labrador.

MR. DEAN: My concern with this is again that all of this money, for the most part, is going in rural Newfoundland, and I certainly see it.  My ask, as you say, last year was $2 million and it was all legitimate.  Until government puts forward a plan that is going to revitalize rural Newfoundland, whatever that plan is in terms of the fishery in particular, the Community Enhancement Program is going to become and has become something that people are depending on.  I know that is not the purpose of the program.  I know that is not why it was designed.  It is something to help someone who has fallen a little short on hours and so on.  In reality, there are a lot of communities out there where it really is the only money coming into the community for the full year in terms of doing anything economically.

I think it definitely needs to be looked at in terms of just being a base piece of money that does something.  Because of the way it has shifted, I guess the demographics, the economic opportunities, and the age of the people who are there, I think you are going to see community enhancement important some time yet.  That is my thought because you have a lot of people in that older age category who cannot go anywhere.  You can retrain them but, quite frankly, they probably still could not find work.  So they are caught right here sort of thing.  The amount concerns me.

The other thing that concerns me, Minister, is every year we talk about getting the program out earlier and we still end up in December and January out trying to do some outdoor work in particular.  I know we want good value.  We all want good return for the money.  We are not satisfied to have people shovelling out snow from hydrants or something only because they are there and you need to do something with them.

There is a lot of difference in the climate in Newfoundland from the Avalon to the Northern Peninsula.  For example, I am going to skidooing this weekend when I go home.  That is just where it is.  October works fairly well; December does not work.  At that point, you have municipalities or sponsors that are just trying to find a way to do this really and you are not getting the best bang for your buck.

All I am saying is: Is there a way to bring attention to it sooner and have the programs ready to roll?  I think we would get a lot better result from it.  I think you should be prepared to go back to the $8 million again this year because the ask will certainly be a lot more than what your budget is.

MR. O'BRIEN: Yes, and it could be at the $8 million mark.  It could be higher.  As the minister responsible, I am prepared to go back to the figure that is reflective of the need.  We have to evaluate that each and every year.  We do endeavour to try to get it out as soon as we possibly can.  I think I was shifted into Municipal Affairs just after the MNL AGM.  This was one of the first categories that I tackled and try to get it out the door as fast as I possibly can.  As well, most of these people are all seasonal workers, so you have to wait until the season really winds down to see exactly what the need is.  We do not know the need until it winds down.  Each and every year it varies in regard to that.  The fishery is reflected into it as well.

I understand your points that you just made with regard to December or January not being the proper months to have it out there and have people out there.  From my perspective, I will personally try to get it out there as quickly as I possibly can, as long as I am here in Municipal Affairs.

MR. DEAN: Okay.

CHAIR: Thank you.

Ms Michael.

MS MICHAEL: Thank you very much.

Just to continue a little bit, Kevin, with that.  Obviously, being the MHA for Signal Hill-Quidi Vidi, this is not something I have to worry about, but -

MR. O'BRIEN: Me either.

MS MICHAEL: - being Leader of the Party, I am interested in learning more about the provincial system.  Both with regard to the Special Assistance, under 3.1.03, and the Community Enhancement, are there defined criteria for making a decision about when and how much to give? 

MR. O'BRIEN: We take applications in regard to that program from the various stakeholders in communities.  That could be the municipality itself; it could be a not-for-profit organization.  We then evaluate those applications internally.  We look at them from a number of perspectives.  The long-term benefits for the community are taken into account, not only just the workers' needs in regard to those particular projects are taken into account.  As Marshall mentioned, in this program we want a bang for our dollar; we want something that is lasting to the community.  We look at the various aspects of that particular application, and then we will make a decision and rank them in regard to what we believe are the ones that maybe we should fund as compared to ones that might have merit but not as much as the one that we would fund.  In regard to a district, for instance, as big as The Straits, we will take in the whole region as well and try to spread it across the whole where people would not have to travel greater distances, we take that into account as well.

MS MICHAEL: Okay, thanks.

Again, coming back to talking about the local service districts and your concerns for all municipalities et cetera, I am curious about how many - and again just to explain, I became more aware of this after Igor when I did do a trip out to the Bonavista Peninsula and realized that a place like Trouty, for example, was not even part of a local service district.  How many communities do we have like that and where do they fall in terms of getting serviced et cetera?

MR. O'BRIEN: You are talking unincorporated areas?

MS MICHAEL: That is right, yes.

MR. O'BRIEN: We have a number of them; I would not be able to put a real figure on them really.

MS BARNES: I can give a quick breakdown.

MR. O'BRIEN: Yes.

MS BARNES: Most of the population in the Province lives in a municipality; about 88 per cent lives in either an incorporated municipality or an Inuit community government.  We have about 162 local service districts and that is about 4 per cent, 5 per cent of the population.  Similarly, I think the total community count – they are hard to count because it could be just a little cluster of houses.  The overall community count is about 575 to 600 communities and the balance of the population would be unincorporated areas such as Trouty.

MS MICHAEL: Right.  Then, where do communities such as Trouty fall in terms of their servicing?  Is it under Transportation and Works or is it under Municipal Affairs?

MR. O'BRIEN: It depends.  Mainly, I guess, the unincorporated areas are encompassed or on a provincial road.  In regard to snow clearing and that kind of stuff, well that is done because it is a provincial road.  When it is an unincorporated area, they take care of their own needs really.  That is the reason why they are unincorporated, they do not pay taxes, and they do not pay anything like that.  They put in the designed sewer system, they have their own water system, and they certainly pay a fee to the municipality or the nearest municipality that would provide a certain service such as garbage collection, or fire services or whatever it may be.  That would be done jointly between the particular families who live in that unincorporated area.

MS MICHAEL: Okay, that is helpful.  Thank you.

I have one more question.  When you talk about the road in a place like Trouty, would that also include the road that goes the length of the houses or just the road that goes sort of through the community?

MR. O'BRIEN: Just through the community.

MS MICHAEL: Just through the community.  Okay, thank you.

I will go back to line items now.  Actually, 3.2.01. Municipal Infrastructure, I think you have really answered the questions there.  All of that has to do with the restructuring.

MR. O'BRIEN: Yes.

MS MICHAEL: Right.  I do not need to go through that one because I think you have given that.

Under 3.2.02. Federal/Provincial Infrastructure Programs, under Salaries, the salaries were revised downward in last year's budget and up by almost $300,000 this year.  What is happening there to make the salaries go up that much?

MR. O'BRIEN: That is under the re-profiling as well in regard to engineering positions.

MS MICHAEL: Okay, great.

Under Grants and Subsidies, we underspent by about $34 million or $35 million and we are back up to $117 million this year; just an explanation of that line.

MR. O'BRIEN: Why.

MS MICHAEL: Yes.

MR. O'BRIEN: Well, the decrease really reflects lower than anticipated expenditures under those particular programs.  So, in other words, if you have less projects being completed, then that reflects the decrease.  They are in process.

MS MICHAEL: Okay, and it would be similar under the next line item, 3.2.03, the Gas Tax Program?

MR. O'BRIEN: That is correct.

MS MICHAEL: That is dependent on projects that come forward from the communities?

MR. O'BRIEN: Yes, that come forward.

MS MICHAEL: Okay, thank you very much.

Let's move into Fire and Emergency Services.  You gave a fair bit of explanation under this in your opening comments.  I think what I would like to do here, it is not the line items so much that I would like to get at, but first of all to say, I think we all recognize the tremendous job that was laid on the people in this division in your department because of Igor.  It was major.

MR. O'BRIEN: Thank you for that.

MS MICHAEL: I certainly recognize it.  I also recognize the great difficulty there is in explaining to the public and especially people who are in distress, the restrictions that you are working with as well.  Just like if you are dealing with an insurance company, you do not get any money unless you can prove the situation that you are in.  Yet, at the same time, we all know that it is quite obvious when there has been a major disaster, we do not have to prove that people have been affected.

I am just wondering, because I am sure it has been a major discussion and you are probably still in some kind of an emergency mode inside the department, have you been able yet to look at the issue for how to lessen the distress that people are experiencing in trying to deal with the fact they no longer have a home, they no longer own anything, and they have nothing?  How can we make it more human, while yet having to deal with the restrictions?  I know you have to deal with the federal government in getting money back from them.  You are not going to get anything you cannot prove was spent, et cetera.

When people are under such stress and distress, how can we make it better?  Are you able yet to have had that kind of discussion?  Is that going on inside the department?

MR. O'BRIEN: Communication; that is what takes away the stress.  Shortly after I became the minister, I initiated a process down at Fire and Emergency Services that we would not wait for the particular claimant to contact us.  We contacted the claimant, just even to let them know that their claim is actually active.

There is a certain amount of anxiety associated with just sitting around waiting, and just to get a call from us - we were making 200 and 300 calls a day to claimants just to contact and say: Listen, we are working on your claim.  We do not have anything for you yet, but it is moving through the process and that kind of stuff.  We anticipate having your claim finished by a certain date, whatever it may be that we could say to them.

Lorraine, in regard to that stress and taking away that stress, we are letting them know that we are concerned, letting them know that we are trying to deal with their issues, letting them know the challenges that we have in regard to the federal guidelines, and letting them know that there other groups out there, not-for-profit such as the Red Cross and Salvation Army, that could fit if something does not fit in regard to those federal guidelines.  It is all about communication.

I think we have done a great job at that.  I have said here in the House and I will say here, too, that when Randy Simms says he is not getting calls in regard to complaints, then we are doing a good job.

MS MICHAEL: I am glad to hear what you have said.  When I went out, I went out to the Bonavista Peninsula.  I did not go out, obviously, early on because I did not think it was the place for me.  I felt that people who could do something about the situation were the ones who needed to be out there.

I did go out a number of weeks after, four or five weeks after.  As you know, it was just as devastating to look at four or five weeks after, I think.  One of the things that I experienced was people who still really did not know what was going on, people with their houses hanging out over a cliff and not knowing what was happening.  So, to hear what you are saying is really important to me because I think that was one of the biggest parts of the stress: not knowing what was happening, not knowing if anybody cared and the very fact that - and I did not do it for this reason, I have to say that.  I went out to get a sense, myself, of what the devastation was.  One of the things that was said to me by people: Ms Michael, it is so good to have somebody to talk to.  We do not know if anybody is listening.  We do not know if anybody is hearing what we are really going through.  I heard that especially from the communities that were the worst devastated communities.

MR. O'BRIEN: Yes.

MS MICHAEL: I am really glad to hear that is what has been learned in the department because I think you are really right.  I am not saying this, you have said it and I am just going to repeat it: Just as much has to go into getting people out there just to talk because the bottom line is they are out of communication.  So, those of us who are outside of it have to put all that much effort into communicating because they are out of communication, period.

MR. O'BRIEN: That is correct.

MS MICHAEL: I am really glad to hear you say that.

MR. O'BRIEN: Thank you.

MS MICHAEL: Like I said, I really do understand the issues that you are dealing with. 

I do not think I have any line item questions in this area because I think everything is sort of self explanatory.  You are going to be surprised if I do not ask this, or at least the department will be surprised if I do not ask this: Could we have an update with regard to 911 and what is happening?

MR. O'BRIEN: 911?

MS MICHAEL: Yes, 911 services.

MR. O'BRIEN: We have issued the RFP, as you know.

MS MICHAEL: Yes.

MR. O'BRIEN: That took a little longer than we thought in regard to fleshing that out and getting it out.  That is out there now and we have several responses.  They are being evaluated within the department.  We are moving it forward.  It is a complex piece.  It is not like it seems so easy that we set up 911 across Newfoundland and Labrador.

MS MICHAEL: No, I know that.

MR. O'BRIEN: It is quite complex and quite costly.  It could be quite costly.  If we are going to go down this path, we are going to do it in a manner that we do it right.  So, we are not moving it too fast.  We are making sure that we get what we want in regard to the data and the advice that we need, so that is moving along.  I cannot give you any real good update in regard to that, Lorraine, at this point in time, but certainly would be open, as you know, to giving you an update any time in the future.

MS MICHAEL: One of the prep things, of course, that has to be done - and we have all talked about it before - is the numeration of houses in the municipalities.  Are you monitoring that with municipalities in terms of where they are with that?

MR. O'BRIEN: That is a responsibility of the municipality, but we certainly advise them and encourage them to number their houses, name their streets and that kind of stuff that basically is in their best interest when it comes to fire services and such services as that.  As you know, we are dealing with a very old Province here in regard to that.  There are certain areas across the Province that are not numbered at this particular time.  A lot of municipalities have moved forward in regard to naming their streets and numbering their homes to a certain degree over the last number of years, but it is a challenge.

MS MICHAEL: You may need to say to them they need to do some public education, too, when they do it.  When I was campaigning in Terra Nova, for example, I remember people saying to me - and I said: Are you such-and-such a road and such a number?  They did not even know that they had new road names and that they had a number.  They said: No, all I know is this is such-and-such hill.  I said: Well, it may have been such-and-such hill a while ago but it is not any more, this is your street number or your road number and this is your number.  There needs to be a lot of education, too, with regard to that.  People do not even know that they have new names, in some places.

MR. O'BRIEN: That is correct.

CHAIR: Okay, Ms Michael?

MS MICHAEL: I think that is all for me at the moment, yes.

CHAIR: Mr. Dean.

MR. DEAN: Thank you.

You talked about Igor somewhat, and there is just one question that I would have from Igor.  Are the claims that were denied - and I have had a couple of calls, not a lot of calls but I have had a couple as recently as a couple of days ago from the area of people who were denied.  Basically, they have had their loss and cannot rebuild or whatever the case is.

I am just wondering if you can tell us - I understand there would be regulations in terms of the federal-provincial program that has been there for thirty-plus years now and some things fall outside of those guidelines.  Provincially, are we looking at having something that covers that?  When a hurricane sweeps through an area, it is hard to really understand that this person is covered, the next person does not.  Can you share something about where that is in terms of who does not get to qualify and for what reasons?

MR. O'BRIEN: Each and every claim, as you know, is evaluated on their own merit.  Certainly, as you just said, it has to meet the federal guidelines in regard to their disaster assistance program.

I will say this as well: I would like to close each and every claim for the simple reason that it is ninety-ten dollars federal as compared to provincial.  So we do not just deny claims for whatever reason.  I would rather close each and every claim with an offer because, as I just said, it is ninety-ten dollars, but that is not reality.

Certain items are insurable items.  Each and every person across Newfoundland and Labrador are responsible for the insurance of their homes.  So it is pretty hard for us a government, regardless of a disaster, because a person could have whatever happen to them today on an individual basis, be it in a windstorm or whatever it may be, and it is an insurable peril.  So what do we do with that?  Just because it is a disaster, we start dealing with insurable perils.

In regard to any of the media coverage and any of the talk shows that I have done, I have certainly reflected that a person should – and as a matter of fact we have seen a spike in regard to people now coming, questioning, and also insuring their homes.  That never happened before because Igor has really brought a focus to that and the need to have that.  You just do not know.  People chance these kinds of things for a long, long period of time and then it happens.

Marshall, for us to come in with a program that would meet all the needs over and above the federal guidelines would be nearly impossible, to a certain degree.  That is where your not-for-profits come in, such as the Red Cross and the Salvation Army.  If it is an insurable peril, taking that as an example, and the claim was denied because of that, well then we would push it over to one of the not-for-profits and they would make a decision if they would pay out or not.  So it is pretty hard for us to cover beyond.

We try to be as innovative as we possibly can to make something work in regard to a particular claim, just taking Igor or any of the other events that we have had in the past, to address the needs really of the particular claimant, but sometimes it just does not meet the guidelines.  Then when it does not meet the guidelines and because it is a specific reason such as an insurable peril and the person does not have insurance on their house or whatever it may be and had availability to get that insurance, well then we have a hard time to address that issue from a government because there are a lot of people out there who  will be in that same category regardless of a disaster or not. 

MR. DEAN: I guess that is a fair statement, to some degree: We should all be expected to be responsible and insure our properties.  Would there be exceptions to that rule?  There are people out there who realistically cannot afford to insure, even though they cannot afford not to.  There would be a category of people, I think, who you could argue cannot afford to.  Is there a provision for that? 

MR. O'BRIEN: Where do you draw that line in the sand?  Then you will have to do an evaluation process in what they can and cannot afford.  That is a hard process to go through.  Again, that is where the not-for-profits come in.  They would go in and evaluate that need.  They would go in and evaluate if they could or could not afford and then make a decision.  Also, we have seen time and time again across Newfoundland and Labrador, especially in rural Newfoundland and Labrador, you may have a fire, a person's home is destroyed, they do not have insurance and then the community comes together.  All of those kinds of good things kick in.  Are they the proper solutions?  No, they are not.  The proper solution is to have that insurance.  That is the way it is, it is not a great cost.  Sometimes you have to prioritize your expenses in your household and do it.  Sometimes you have to make those decisions that some of the social things that you might do in a household goes to the wayside and insurance comes first.  That is a decision that the homeowner has to make, government cannot make that for them. 

MR. DEAN: I think the last update we had was probably a couple of years ago.  The department was showing around $47 million still outstanding from a 2003 disaster.  Was it 2003?  I guess it was Buchans? 

MR. O'BRIEN: That is Badger.

MR. DEAN: Badger, sorry.  I didn't mean Buchans.  Where is that now? 

MR. O'BRIEN: Well, we are still moving it through.  That is why we have learned from that one in regard to dotting the i's and crossing the t's because the federal audit is a very stringent audit, very stringent, and that is the reason why this one is taking so long because the documentation that was kept at that particular time was not what it should be.  We learned from that one and went into Chantal, I believe.  We had better documentation in Chantal and we have even really refined that to another level in regard to Igor.  That is the reason why that is in, but it is going through the system.  We anticipate, I believe, closing that file probably within the next year – anywhere between six months to a year. 

MR. DEAN: The Badger one, you mean?

MR. O'BRIEN: Badger, yes.

MR. DEAN: Where do you expect that figure to be, the $47 million?

MR. O'BRIEN: It depends.

MR. DEAN: Where is it now?

MR. O'BRIEN: We paid it out.

MR. DEAN: I realize that; I am looking at it from the government's receivable to the federal government.

MR. O'BRIEN: It is there.  It has been a subject of the federal audit, but it has not been paid by the feds yet.

MR. DEAN: The $47 million, is it $43 million or $41 million?

MR. O'BRIEN: We would not know.  Because, if I remember right, we claimed about $47 million and then that is all subject to the federal audit.  The federal audit could dictate that it is $42 million at the end of the day because they deny according to their guidelines.

MR. DEAN: Yes, okay.  They make one payment is what you are saying?  You are waiting for them to determine what part of that $47 million they are paying in total?  There is no getting two claims paid now and four later or anything of that nature?

MR. O'BRIEN: Go ahead.

MS MCCORMACK: In the most recent events, they have agreed to interim payments, but in the old ones they have not.  I think a large part of it, as the minister said, is related to documentation.

We do have all of our work done on Badger and they came back, I think, with another series of questions.  We never know exactly what they are going to come back with until we get the final audit statement and then we have to do a concurrence report with them.  We do not really have an idea at this point on Badger, but we are hoping to have that finished soon.

MR. DEAN: Okay.  When you get the cheque, whatever it is, that is what it is sort of thing.

MS MCCORMACK: That is it.

MR. DEAN: Okay.

I know you mentioned in the House a while ago that you were going to be trying to engage the feds to review the guidelines of the disaster program.  Have you had any success in that? 

MR. O'BRIEN: I was at a federal-provincial-territorial meeting some time ago, probably about two months ago in Toronto; the minister responsible is Vic Toews.  We had some discussion at that table and beyond that table in regard to the federal guidelines.  Sometimes it is not reflective of society today. 

As a matter of fact, there is one change already that came down from Vic.  I just cannot remember exactly what that change was.  I have it on my desk.  I got a letter from him there about a couple of weeks ago that they had decided to reflect that.  I can get you the details in regard to that particular change if you want and I can give it to you here in the House.  I just cannot remember the details and I would not want to get into it without giving you the right information.  I brought several things forward to them for consideration.  They would go back, and then we will come back again in regard that process.

Part of the Igor piece, once we are clueing up Igor and we do an evaluation, will be evaluating that piece as well in regard to how the guidelines worked or did not work and places where we can see that they could be changed or tweaked to meet the actual needs of the particular claimants.

MR. DEAN: Okay.

There is one quick thing I wanted to ask you on the CEP and I did not; I forgot to ask you.  Is it possible for us to get a list of last year's programs and what we paid out?

MR. O'BRIEN: Sure.  Absolutely, in regard to the actual projects themselves?

MR. DEAN: Yes, the projects that were done, please.

MR. O'BRIEN: Yes, not a problem. 

OFFICIAL: That is not finalized yet.

MR. O'BRIEN: When it is finalized, we can because we have to clue that up.

MR. DEAN: Sure.  Thank you.

CHAIR: Ms Michael.

MS MICHAEL: Could we add to that also under Special Assistance, details of what gets put out under Special Assistance?  We just have the one figure there as well.

MR. O'BRIEN: Yes, once we clue up that piece.

MS MICHAEL: Thank you.

CHAIR: Okay.  Is there anything else for the Committee?

Okay, go ahead.

MR. DEAN: I promised them I would not be too long.

I would like to talk about fire fighting services for a minute, which are obviously pretty important, and the government's announcement of I think it was $1 million for new firefighting equipment in the Budget.  Has that money already been allocated?  I know there was some fire trucks put out in Gander and Corner Brook in the last week or so.  Is this all new money?

MR. O'BRIEN: That is all new money.  That, last week, was last year's Budget.  Specific needs, specific trucks, two ladder trucks, and a specialized pumper for Corner Brook, but that was done in last year's Budget.

MR. DEAN: Good.  So there should be a new fire truck up North sometime before the year is over in that case?

MR. O'BRIEN: You never know - soon.

MR. DEAN: In the Estimates of 2009, Minister, it was indicated that an Office of the Fire Commissioner would be established in Labrador.  Can you give us an update on that?

MR. O'BRIEN: The Office of the Fire Commissioner in Labrador?

MS MCCORMACK: That actually is a fire protection officer position and that position is hired.  The person just recently was hired and will be moving to an office in Labrador in May.  Right now, he is on the Island, but just doing orientation.  We do have the position staffed.

MR. DEAN: Okay.  Is that going to be in Goose Bay or Lab West?

MS MCCORMACK: It will be in Goose Bay and the person has a dual role.  In addition to the fire protection services, we will also do emergency services in Labrador as well.

MR. DEAN: Okay, good.

I know NorPen on the Northern Peninsula is doing a pilot regional fire services program and I would just like to get your thoughts on how that is working. 

MR. O'BRIEN: How it is working?

MR. DEAN: Yes.

MR. O'BRIEN: An absolutely fabulous model. 

MR. DEAN: Okay, good.  Awesome.

Just let me see if I have anything else I want to ask before I let you go.  I want to talk about water quality; that was one other issue I wanted to speak to, because it is an important issue, again, when you get into the smaller communities.  As you know, several communities around the Province have been on boil orders for a lifetime, basically.  How do you see that changing?  Where do you see it going or is there a plan around trying to deal with that?  We have 260-odd boil orders right now, I think, or something - 217.

MR. O'BRIEN: It is a question on how quickly we can get the infrastructure needs of the particular community addressed, really, and if they can afford the projects and how we can phase it in, whatever possibly we can do to help the community.  That is where it is to.  We have huge challenges across Newfoundland and Labrador with regard to infrastructure, especially in the water category.  That is essentially where it lies to, and it is not just a quick fix.  You have all those municipalities out there, and I think you mentioned 200-odd or whatever it may be, and they are on boil orders for various reasons.  The bottom line of it is the infrastructure, quite aged and probably none.  So, that is the issue.

As we have moved down - and we have been investing highly, as you know, in regard to infrastructure over the last several years.  As a matter of fact I think in 2009-2010 we are up over the $200 million mark.  This year, as well, we are investing heavily.  It is not just because it is an election year; I will put it that way.  It is just that it is reflective to the needs by us, and that is the bottom line of it.  Like I said, I have $700 million worth of ask and they are a legitimate ask.  As a government, we have to try to address that issue right across the Province, especially in rural Newfoundland and Labrador. 

MR. DEAN: The potable water device or whatever, there are probably just half a dozen communities right now where they are.  Do you see that going further? 

MR. O'BRIEN: We are trying to drive that.  To be quite frank, we have had a challenge in regard to the structure to house that unit in.  The estimates that we have had in regard to those sheds – really, is what they are - are quite high; up in the $300,000 mark and that kind of stuff is what the Estimates were coming in at.  We have now partnered with a couple of municipalities.  They will do it themselves and the price is down where it should be. 

The construction community and the industry did not see them as a priority, and we see our tenders and see our prices come in astronomically high.  That is the whole issue surrounding the movement of those systems.  We call them PWDUs but it is all about the shed.  Those prices were coming in, I am telling you, at $300,000-odd.  Basically, that is what they are, a shed.

MR. DEAN: Yes, okay, an expensive shed. 

MR. O'BRIEN: An expensive shed.

MR. DEAN: There were some changes made in the gas tax policies to allow municipalities to do more with that money.  Is that working?  Is that improving the situation?

MR. O'BRIEN: Yes, it is improving.  We are seeing better drawdown on it and utilization of it.  Me, personally-wise as a minister, I would like to see some other changes there as well but we have not addressed that.  That would have to be put forward to the feds to be incorporated.  That is something I have set as a goal for myself to see if I can get some changes there as well that will give municipalities a little bit, even more flexibility in regard to the usage.

MR. DEAN: Yes, because it is an issue.  I met with a community a couple of weeks back that has $40,000, $50,000 gas tax money sitting there and do not know how to get it.  They know what they could do with it, good legitimate projects, but the guidelines around it just do not allow them to access it. 

MR. O'BRIEN: Yes.

MR. DEAN: It is unfortunate that the guidelines are where they are.

MR. O'BRIEN: Yes.  I am going to try, as a minister and as a department, to address some of those issues because I have heard those issues too as I travelled and met with municipalities.

MR. DEAN: Yes.  Okay.

Waste water treatment regulations; in 2009, I think it was, government indicated they were not going to be signing on to the federal government's waste water strategy because it was too expensive, basically.  Can you give us an update on that and the issue of whether or not…

MR. O'BRIEN: Marshall, that is an environment issue.  That actually does not fall within Municipal Affairs.

MR. DEAN: Okay.

MR. O'BRIEN: Those guidelines are still being developed and have not been finalized.

MR. DEAN: Okay, fair enough, all right.  Did we get them all, do you think? 

OFFICIAL: (Inaudible).

MR. DEAN: All right.

Thank you, Mr. Chair.

CHAIR: Thank you.

Do we have anything else from our committee?

Call the first heading?

CLERK: 1.1.01 to 4.1.06 inclusive.

CHAIR: Shall 1.1.01 to 4.1.06 inclusive carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried, unanimously.

On motion, subheads 1.1.01 through 4.1.06 carried.

CHAIR: Shall the total carry?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

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

CHAIR: Shall I report the Estimates of the Department of Municipal Affairs carried without amendment?

All those in favour, 'aye'.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, 'nay'.

Carried.

On motion, Estimates of the Department of Municipal Affairs carried without amendment.

CHAIR: Minister, I would like to thank you and your staff this morning, and as well thank the committee for your participation this morning.

I will just make people aware that the Social Services Committee for committee members will reconvene on Monday, May 9, to hear the Estimates of Child, Youth and Family Services.

With nothing further, I will ask for a motion to adjourn.

MR. CORNECT: (Inaudible).

CHAIR: Mr. Cornect.

With that, we will adjourn.

Thank you very much.

MR. O'BRIEN: Thank you very much.

On motion, the Committee adjourned.