Devolution money might address infrastructure deficit
Business leaders say resource money should go to transportation projects
Kassina Ryder and Jeanne Gagnon
Northern News Services
Published Monday, October 14, 2013
NORTHWEST TERRITORIES
Transportation infrastructure should be the focus of new devolution money the GNWT will be receiving next year, according to NWT business leaders.
Chris Buist, president of the Norman Wells Chamber of Commerce, said his organization's perspective is that transportation infrastructure should be at the top of the list.
"That would support economic development within our region," Buist said. Better transportation would mean more development, more jobs and would reduce the cost of living and doing business in the North, he said.
Mike Bradshaw, executive director of the NWT Chamber of Commerce, said he agreed.
"There is no question that we have an infrastructure deficit in the Northwest Territories," he said.
Bradshaw said the Corridors for Canada III report, which was published by the NWT Department of Transportation, highlights the need to repair and enhance the territory's airports, roads, bridges and ferry systems.
Bradshaw said infrastructure improvements are critical as the territory moves into the future.
Buist said while transportation infrastructure is paramount, skills training and education are also important.
Buist also said the Norman Wells chamber would like to see the jobs transferred to the territory after devolution distributed throughout the regions; instead of only in Yellowknife.
Under the devolution agreement effective April 1, 2014, about $67.3 million a year goes into the base budget to take over all the transferred programs and responsibilities the federal government currently delivers. The other big pot of money is the resource revenue sharing agreement, where the GNWT will receive 50 per cent of resource revenues to a maximum of five per cent of territorial Gross Expenditure Base - what would have equalled about $65 million this year, said Finance Minister Michael Miltenberger. A quarter of that money is shared between the aboriginal governments.
Buist's hope for more infrastructure might be realized under the financed minister's proposed strategy for spending devolution money.
The territorial government wants to split the funds between paying down the debt, putting money toward infrastructure and future investment.
The territory has an approximately $3-billion infrastructure deficit, said Miltenberger, citing Highway 7 - the Liard Highway - which alone needs a $250-million investment.
"That's just one example of the big ticket items we're trying to fund on a piecemeal basis because we don't have enough money for infrastructure," he said.
Miltenberger added that putting resource revenue money into the main budget would not be wise, as there are many infrastructure projects to be completed throughout the territory.
"We have a whole list of needs and that money is going to help us try to meet some of those current, unmet needs. And we're going to have the debate because some folks want to put it into general revenue and spend it on programs and services," he said. "I, as finance minister, I'm saying it would be a very bad idea to put that resource revenue money into the main budget because it fluctuates."
Norway has done it the "right way with the big heritage fund and enormous amounts of money put aside," Miltenberger said, adding the Scandinavian country has nearly $700 billion of its oil money put away while having a strong economy not skewed by oil prices, which could change at any moment.
"We want to do the right thing, which is put money aside for our children and grandchildren right now and keep it as politically tamper-proof as we can for the first 20 years," he said.
Of the money coming to the territory, five per cent will be put into the NWT Heritage Fund, which received $250,000 seed money in both 2012 and 2013. The money will then be saved and, starting in 2032-33, no more than five per cent can be removed at a time as an investment to future generations.
Miltenberger, headed a meeting in Fort Simpson on Oct. 7, which followed those made last year in seven NWT communities. He said nine people came a year ago when he visited Fort Simpson. This time, only one person attended the meeting.
"As an MLA, when I get a small turnout, I always tell myself, 'It's because people have no real major issue and they're pretty comfortable with what's going on,'" he said. "Because I know, and as Kevin (Menicoche) knows, if people are upset, then you have a meeting - the place tends to be full."
Menicoche, MLA for Nahendeh, was also present at the meeting. Fort Simpson's Mayor Sean Whelly was unable to attend as the meeting was scheduled at the same time as village council. However, he did get a chance to speak with Miltenberger earlier in the day to outline the community's priorities. Whelly said Fort Simpson needs more funding for village operations and new infrastructure.
"We continue to get about $1 million in funding for infrastructure - like to build new buildings, swimming pools, fire halls - but they don't up our operations budget," he said. "When you build a building, you've got power costs. That comes out of your operations side of the budget and (the Department of Municipal and Community Affairs) hasn't been increasing that side of the budget to keep pace with the new infrastructure the community has been building."
In Hay River on Oct. 8, many residents came out in support of the proposed plan for infrastructure development.
"I'd like to see us boldly spend that money and go after the Mackenzie Highway," said resident Beatrice Lepine.
Public meetings about resource revenues took place in Behchoko on Oct. 3 and Hay River on Oct. 8. Meetings are scheduled for Fort Smith on Oct. 15, Yellowknife on Oct. 28, Inuvik on Nov. 12 and Norman Wells on Nov. 13.
Residents have until Nov. 15 to provide feedback on how they'd like to see resource revenues used.
- with files from Sarah Ladik
