BEHCHOKO/RAE-EDZO - Former Behchoko chief Leon Lafferty says the community's current debt is the result of under-funding from the territorial government, not mismanagement on the part of his past government.

Lafferty said he was offended when Municipal and Community Affairs (MACA) Minister Robert C. McLeod said the debt was alarming in recent media reports because he said the government has been aware of the financial shortfalls in Behchoko for years.

"They knew where we stood ... I don't know why the minister would sound surprised and say that it's alarming when he already knew," he said.

"We had annual audits, which are approved by council, which were sent to the minister's office. The minister has his staff look at it and approve and they continued funding it the next year," said Lafferty.

But McLeod said he's up to date on the deficit and his department is working with the community council to deal with the problem, debt of "close to $4 million."

"We've been aware of it for a while. We've had some concerns," he said. "They do have self-government so it was more important that they come to us and say, can you help us deal with the deficit."

He said the community's council passed a motion to ask for MACA's help reaching a co-management agreement and department officials have been meeting with the council regularly. He said he wasn't aware of any specifics of the recovery plan but he anticipated they'd look into ways to control costs.

"They'll have to obviously scale back their spending," he said.

Lafferty attributes the debt to the cost of operating two communities - Rae and Edzo - as one municipality. He said the department should be making allowances for the cost of serving two communities and providing more funding to the water reservoir. He said the two water-sewage treatment plants cost $10,000 a month in electricity alone but since he left council, he's not aware of what the audits have showed.

"The water-sewer is putting us back. They knew that," he said. "I was offended because we've been communicating on this for years."

Lafferty said as a former MLA, he heard about the issue in legislative assembly committee meetings.

"The deficit has been accumulating and we've been fighting with them, almost adamantly, 'we need to get this done,' they kept postponing it... MACA wasn't helpful to us as a community."

"There has been some concern on the distance between the two communities and how it might have had an effect," McLeod said, adding in many communities water and sewer money has increased as part of this year's budget so that should take care of the problem.

He said he didn't think residents should be concerned their services will be affected.

"I don't think they'd be scaling back essentials, they probably will look for other ways to save money."