NWT funding process under review
Deputy minister tells council that formula wasn't effective
Shawn Giilck
Northern News Services
Thursday, April 23, 2015
INUVIK
No one could blame Inuvik town council members if they had told a senior government bureaucrat to show them the money earlier this month.
Eleanor Young, the assistant deputy minister of the Department of Municipal and Community Affairs, (MACA) provided an hour-long update on potential changes in the funding formulas the GNWT uses to distribute funds to territorial municipalities.
Many of those municipalities, including Inuvik, have been receiving less funding than they should have under the current formula, Young told the council, who expressed no surprise.
Other communities, although a minority, have been receiving more funding, and will likely be cut back somewhat.
Young said a full review of the funding formulas hadn't been done by the GNWT since the "new deal" was struck in 2007.
"One of the big reasons being was that when we spoke to stakeholders a few years ago, they really felt it needed to be taking place at a time when we had some likelihood that we had additional resources to be put into the pot," she said during the presentation. "We needed to have an overall increase to the pots to make this reasonable. The sense was that, overall, the amount of funding we were supplying wasn't enough."
Young said municipalities had been telling the GNWT that the current funding formulas just weren't adequate to serve their needs. She said the government had never looked at funding the municipalities on the basis of their needs.
Municipal leaders had also been telling the GNWT the formulas didn't result in an "equitable distribution" between communities."
"There was a perception that some of the smaller communities had more funding than they needed to do some of the same services."
The formulas were also very difficult to explain to municipal councils and staff, and the GNWT wanted to remedy that, Young said. She called it a frustrating process to sit down with municipalities to discuss funding.
The review of the formula began in 2013, and has continued since with a working group that saw 17 communities represented, along with MACA officials.
The shortfall of funding adds up to a total of $40 million every year for municipalities such as Inuvik, Young said. For some, that makes it difficult to provide basic services and to maintain them, she added.
"We've tried very hard to come up with the best solution," Young said.
There were relatively few questions from the council members, who planned to discuss the report further at a future meeting.
Councillor Alana Mero asked why some infrastructure had been left out of the report.
Young explained that only infrastructure common to all municipalities had been included in the calculations. Other infrastructure and services, Young said, using the Inuvik Homeless Shelter as an example, had been left out so that communities could be evaluated on a common basis.
"For fairness across communities there were certain types of infrastructure that were left out with the understanding that those could be paid for out of your own source revenue."
She added that allocating funds under the new formula are flexible, and can be adjusted by each individual council.
Councillor Joe Lavoie asked whether a cost of living index was included in the new formula, and Young said provisions for that had been factored in.
Mayor Floyd Roland said "there was a lot of material to go through."
"It's not clear where some of this funding is going to come from," he added. "The expectation of more funds is going to be a challenging exercise (to manage)."
"There's only limited places where that funding can come from," Young agreed.
