April 4, 2006 SOCIAL SERVICES COMMITTEE

Pursuant to Standing Order 68, Kevin O'Brien, MHA for

Gander, replaces Kathy Goudie, MHA for Humber Valley.

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

CHAIR (Ridgley): Order, please!

Good morning. We are ready to start.

I apologize for the delay. Unfortunately, Kathy Goudie was supposed to have

been here but she phoned in just a few minutes ago and she is not very well. She

is home throwing up, apparently. We do not need all of the details, but she is

not well.

OFFICIAL: (Inaudible).

CHAIR: She should have.

For the present time, Kevin O'Brien is going to sit in, if that is

acceptable to everybody, and we are arranging to have the paperwork done now. It

is kind of unavoidable.

We welcome everybody here. I would ask the members of the Committee to

introduce themselves, please.

MR. PARSONS: Kelvin Parsons, MHA for Burgeo & LaPoile.

MR. LANGDON: Oliver Langdon, MHA for Fortune Bay-Cape la Hune.

MR. R. COLLINS: Randy Collins, MHA for Labrador West.

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

MR. F. COLLINS: Felix Collins, MHA for Placentia & St. Mary's.

CHAIR: Okay.

Perhaps the minister could introduce his staff.

MR. J. BYRNE: Yes.

I am Jack Byrne, Minister. We have Don Osmond, Deputy Minister; Ramona Cole,

Assistant Deputy Minister of Municipal and Support Services; Baxter Rose,

Assistant Deputy Minister of Engineering, Policy and Planning; Wayne Moores,

Manager of Financial Operations; John Tomkinson, Director of Communications; and

up on back is Veronica Hayden, my EA.

OFFICIAL: (Inaudible).

MR. J. BYRNE: She has a job there to do that, I will tell you that, a

full-time job anyway.

CHAIR: Just before the minister begins with his introductory remarks, I

remind everybody that if you are going to ask a question or reply to a question,

other than, I guess, the minister's voice, which will be most predominant here

in replying, if you are answering a question please just introduce yourself and

give your name because the people downstairs have some difficulty following the

conversation if they don't know who is speaking.

We will allow the minister to give his introductory remarks. At that time,

then, if somebody wants to respond to those remarks we will allow an equal

amount of time and then we will go from there in ten-minute segments unless

there is somebody - if nobody else wants to speak, then we will allow the

current speaker to carry on.

Oh, yes, we have to introduce subhead 1.1.01. We would ask for a motion that

it be carried.

MR. FRENCH: So moved.

CHAIR: Moved by Mr. French and seconded by Mr. O'Brien.

Minister?

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

I have a prepared statement here, two or three pages. I am going to read that

and hopefully all of your questions will be answered.

I am pleased to be here this morning to present the Estimates of the

Department of Municipal Affairs. I look forward, as do my staff, to answering

any questions which you may have. I introduced my staff already.

As minister, I meet with hundreds of municipalities and interest groups. The

most consistent question I receive is on capital works. This department

administers the Canada-Newfoundland and Labrador Infrastructure Program, the

Multi-Year Capital Works Program, the Municipal Capital Works Program, the

Municipal Rural Infrastructure Fund, and the gas tax.

This past year, as part of an effort to accelerate the approvals process for

capital works, we have initiated an on-line application form. This is a new

initiative that will improve the quality of applications thanks to a series of

checks and balances incorporated into the software. The system also provides a

means for applicants to go on-line and quickly update capital works priorities,

should they be required.

I will now provide a brief overview of my department's investment in

municipal infrastructure in the coming year.

We are investing $22.5 million in our Municipal Capital Works Program to help

municipalities develop priority infrastructure such as roads, water, sewer, and

municipal buildings. We continue to leverage federal funding for our municipal

infrastructure under three cost-sharing programs: $9 million under the Municipal

Rural Infrastructure Fund, $1 million under the Canada Strategic Infrastructure

Fund II, and $700,000 under the Canada-Newfoundland and Labrador Infrastructure

Program.

The total provincial investment in municipal infrastructure this year is

$33.2 million. The annualized investment in infrastructure from all three levels

of government is estimated to be $109 million.

The federal gas tax rebate program will see $19.8 million in funding for

municipal infrastructure programs for environmentally-sustainable projects. It

is expected a portion of funding will go towards implementing a solid waste

management strategy Province-wide.

In recent years, Municipal Affairs has been tasked with administering a

number of employment support programs. The challenge of delivering these

programs continues to have a significant impact on departmental resources and

staff. Last year, we administered the Crab Workers Support Program, the

Community Enhancement Program, as well as specific support programs for the

communities of Harbour Breton and Fortune, for a total of $12.5 million,

creating 29,000 person weeks of employment. That effort continues this budget

year with a total of $5.5 million invested in various programs creating an

estimated 12,000 person weeks of employment.

Budget 2006-2007 provides $4.25 million to the Community Enhancement Program.

The Community Enhancement Program will generate an estimated 10,000 person weeks

of employment.

Reliable infrastructure is vital to sustaining our municipalities, especially

in rural regions. Infrastructure promotes job creation. These projects are

providing residents of our Province with important employment that will benefit

the economy of the Province.

The events of September 11, 2001, and the extreme flooding events in Badger

and Stephenville, have increased the demand on my department's emergency

services division. Budget 2006 includes a further $290,000 to emergency services

for emergency preparedness and response. The new funding will support three new

staffing positions: emergency management officer, disaster financial assistance

arrangement co-ordinator, and fire protection officer. This is a significant

increase in human resources that will support existing staff with a variety of

duties including inspections, investigations, emergency planning and financial

assistance.

During Budget 2004 this government announced a $5 million reduction in the

Municipal Operating Grants which will be carried out over three years. Budget

2006 includes the reduction of $1.5 million. We took no pleasure in making these

cuts, but they were necessary as part of the ongoing efforts to get our fiscal

house in order.

I do note that the Newfoundland and Labrador Federation of Municipalities has

stated they are pleased with the investment government has made in

municipalities in the current budget. The Department of Municipal Affairs

continues to support our Province's municipalities. The department provides

substantial financial support, infrastructure development, legislative tools for

municipalities, training for elected and appointed officials to ensure greater

professionalism at a local government level, partnering with stakeholders such

as the Newfoundland and Labrador Federation of Municipalities, the Newfoundland

and Labrador Association of Municipal Administrators, the Newfoundland and

Labrador Association of Fire Chiefs and Firefighters, and the Combined Councils

of Labrador.

I hope this introduction gives you a broader view of the direction that

Municipal Affairs is taking. I welcome you questions and comments.

Thank you.

CHAIR: Thank you, Minister.

Does somebody wish to respond to those comments before we begin the

questioning, or is it the wish to just proceed with the questions?

Are you going to start the questions?

MR. LANGDON: Yes.

CHAIR: Mr. Langdon.

MR. LANGDON: Thank you very much.

I want to thank the minister and his staff for coming here this morning to

appear before the House Committee.

I am not going to go down line-by-line, and these types of things. I want to

talk a little bit about policy direction and programs, and see where they are.

Yesterday, in the House, I asked you about the Stephenville situation. You

announced that $21 million had been spent in Stephenville. I think you came back

and said, of that $21 million, $8 million is provincial funds. I am wondering if

you can elaborate a little bit on that, to us, as to why the $8 million, and

what is it that you are asking to change in the federal formula?

MR. J. BYRNE: With respect to the Stephenville flood, when we did the

assessment on it - I had the assessors out there - the damage, the problem was

that we had to determine a flood control area with the boundary, where the

danger would be. Within that area there were 103 homes that had to be relocated;

we decided we would go down that road. When we made the decision to go down that

road we put the Province, basically, at risk of $8 million to repair and replace

under the Disaster Financial Assistance Arrangement. That is what the federal

government's program does. To relocate, basically, they do not get into that,

but they have agreed that they would allow the money to repair and replace to go

towards relocation. To repair and replace would cost about $13 million, to

relocate $8 million, so we are trying to negotiate with the federal government

now to change the Disaster Financial Assistance Arrangement guidelines.

During the election we wrote all three leaders. We did get a commitment back

from the present Prime Minister that they would look at this seriously. I have

had two meetings, one with Minister Hearn and one with Minister Chong, to

discuss this, and basically they have agreed to take a serious look at it. If

they don't decide to change the Disaster Financial Assistance Arrangement

guidelines, they could do it under another program and that is usually done

through Intergovernmental Affairs, where they have done it in Edmonton, Quebec

and Winnipeg. It has been done in the past and we are hoping they will do it

just as, basically, an offshoot from the DFAA, a separate deal for a separate

project.

MR. LANGDON: How many houses did you say they are going to be moving into

the new subdivision, 103?

MR. J. BYRNE: What is happening is that there will be 103 homes to be

relocated. Outside the flood zone there are twenty-five homes. We are going to

repair or replace - or restore, really - to repair or restore to the original

condition. There are twenty-five there, as I said. That could cost upwards of

$800,000.

OFFICIAL: (Inaudible).

MR. J. BYRNE: Pardon?

OFFICIAL: (Inaudible) $8 million.

MR. J. BYRNE: It is $8 million to relocate outside of that.

MR. LANGDON: I understand.

MR. J. BYRNE: What was the question again?

MR. LANGDON: I said, how many houses have you put in the new subdivision

or are about to put in the new subdivision?

MR. J. BYRNE: There are 103 homes to be relocated, but the agreement will

be that we are not necessarily going to build a subdivision. People can take the

cash settlement and either build again themselves or do what they want.

MR. LANGDON: You are not going to create a new subdivision?

MR. J. BYRNE: No, that is not the plan. I do not think the people want

that, actually. They want to have some options. A number of these people are

seniors. They might want to take the money and move into a senior citizens home.

They may want to move in with family. Again, we are prepared to let them make

that decision.

MR. OSMOND: If I may clarify, these homes are not being relocated. What

is happening is that the people who are living in those homes, or had lived in

those homes, will be relocated. The homes, in fact, themselves are not

habitable. They will be, for the most part, demolished.

MR. LANGDON: I understand that. Are you allowing the people who own those

existing homes to tear them down themselves, or demolish them themselves, and to

use the material for cabins or whatever the case might be if they so desire?

MR. J. BYRNE: We have had some discussion on that and, once we make an

agreement with the homeowners that, say, they settle on $60,000 or $80,000 or

$100,000, from the time we make that agreement until the deal is signed, they

still own those homes. We are telling them that it would not be a good thing to

do - for safety reasons - to go in and to start taking windows out, doors out,

cupboards, or whatever the case may be, but for that period of time they do

still own those homes. We will stress that they should not, but what control we

would have is questionable.

MR. LANGDON: Is it possible for the people who own these homes, once they

have their settlement in hand, the cash in hand or whatever, that they can sell

it to somebody else?

MR. J. BYRNE: No, no.

MR. LANGDON: You will cut that?

MR. J. BYRNE: They won't get the cheque until they sign the deed over

to us. That is taken care of. That is not a problem.

MR. LANGDON: Where is the situation now? Have cheques been issued to any

of the people in the Stephenville region yet?

MR. J. BYRNE: Not for the homes, because we only recently determined the

flood control area. There have been 278 applications, which include the 103

within the flood control area. There have been 126 that have been settled. I

think there is upwards of $800,000 that has been given to the people in the area

who have claims, anywhere from $100 to $75,000 at this point in time, but the

people within the flood control area, and the twenty-five homes that have not

been occupied outside the flood control area, they are still being assessed. We

have assessors and appraisers on the ground now doing the final assessments and

appraisals so we can make the settlements.

MR. LANGDON: How many people are still staying in rented accommodations

or hotels or what have you?

MR. J. BYRNE: Basically, the 103 families that were within the flood

control area and the twenty-five families that are outside that have not had

repairs or replacements done, those 128 homes so far. Those people living in

those homes are still in rental units.

MR. LANGDON: One hundred and twenty-eight. Is that rent being paid for by

government?

MR. J. BYRNE: Yes.

MR. LANGDON: Okay.

The other thing on that situation in Stephenville, I know when we had the

flood situation in Badger there was a lot of money raised by the different

charitable organizations, the Lions Club, you name it, church groups and so on,

and they picked up a lot of the extra cost that was not covered under the

Newfoundland-Canada disaster program. How has the level of those types of

contributions measured up to what it was in Badger?

MR. J. BYRNE: Groups like the Red Cross, you are talking about, they were

on site the very same day. The monies that they have collected, what had

happened in the past was that, when the Red Cross paid out some money to some of

the home owners who had damage in Badger, say, and they paid for certain items

such as fridges and stoves, that was clawed back from the DFAA guidelines. We

have told the Red Cross out there now that they should be careful in what they

are giving the money for, so it would not be clawed back from the DFAA

guidelines. Now the total amount of money that has been collected, I do not have

that at my fingertips but I could get it for you.

MR. LANGDON: For me it would just be a matter of curiosity, I guess, to

see how much money was actually given by the charitable organizations to

Stephenville compared to Badger. It is probably a little different because

Badger was winter and ice, and the first time we had that particular situation.

It is progressing, and hopefully these people can be out of the rented

accommodations sooner rather than later.

The other thing that I wanted to ask you about is the waste management. I

know that recently you disbanded the group that was here on the Northeast

Avalon. I am not sure if you have replaced it by anybody else, or whatever the

situation is, or if the Dog Hills project is dead per se and Robin Hood Bay is

now going to be the choice for the next twenty-five or thirty years. I am

wondering if you can elaborate on that for us.

MR. J. BYRNE: Well, as you know, the previous Administration brought in a

Province-wide Waste Management Strategy which we basically agree with - say 90

per cent of it, no doubt there. The problem, of course, was that we had no money

in the short term or the long term to implement the program. We now have worked

a deal with the Newfoundland and Labrador Federation of Municipalities to take a

certain portion of the gas tax to go towards a Province-wide Waste Management

Strategy. With the Federation of Municipalities money, the money that the

Province plans to put in, and money from the MMSB, we are hoping to, over the

next fifteen years, come up with $200 million to implement the strategy. That is

a positive step. Hopefully, we will start that very soon.

On the Northern Peninsula, of course, when we first formed the government,

the regional authority legislation had been passed but not approved. We did it

in the House, as you know. We have the Northern Peninsula Waste Management

Authority. We are looking at Central now, in the Avalon and out West, to put

authorities in place. On the Avalon we did disband the committee. It was not all

that active, presently, over the past year or so, because there was no funding

available to do anything, really. On September 27, we had new faces elected to

council. Some people who were on the committee had not been re-elected, and some

people had resigned, so we said we would disband that committee, we would

appoint a new one, which has not been appointed yet. We are going to be asking

the councils and the towns, whatever, the city, the towns, to appoint somebody

from their region as we did in the past. That committee, hopefully then, would

be given the authority, I suppose, to try and negotiate with the City of St.

John's and ourselves to come up with plan for the Avalon.

Robin Hood Bay, of course, the situation with Robin Hood Bay was that to

dismantle Robin Hood Bay and to reclaim it would cost $30 million to $40

million. To put the Dog Hills site in place, the estimates were $40 million.

Also, it was considered that if Robin Hood Bay could be considered as a natural

containment, and proven through engineering, environmental studies or whatever

the case may be that it could have natural containment, it could make sense to

do that. Instead of spending of $70 million or $80 million we could spend half

of that and have a site for the next twenty-five or thirty years. That work is

ongoing. There have been some studies done saying that could quite conceivably

be the case. There is some more work requested by the Department of Environment.

Once that is done, then the decision will be finalized whether it could be the

site. If it is, Dog Hill, what is planned is that we could look at Dog Hill as a

future site and freeze that area. Robin Hood Bay, if the study shows that it

cannot be, then we will have another look at Dog Hill.

I don't know if that answers all of your questions or not.

MR. LANGDON: Okay.

The Conception Bay North situation - I know there was a problem when I was

there three years ago - what are they doing? Are they still bringing their waste

to Robin Hood Bay?

MR. J. BYRNE: Yes. CBN, as a matter of fact, I had meetings with them not

long ago. What I have been trying to convince the people in the towns in that

area is that they would come together. Now we have like four or five trucks, or

maybe more than that, coming in four to five times a week - that they would get

together and we probably would assist them in the purchase of a bigger vehicle

to compact the garbage and probably have two trips in a week type of thing. That

is the road that we are taking but, even before we can go down that road, Robin

Hood Bay, if it is the site, has to be designed so that it can take the larger

vehicles because of the weights and stuff. That is some of the problem with

Robin Hood Bay, but once that is done - CBN now are bringing their garbage in.

There is Carbonear, Harbour Grace, all of these people out that way. They do

have some problems with what they call white materials, is it? - fridges,

stoves, these types of things. Is that the proper terminology?

OFFICIAL: It's as good as anything.

MR. J. BYRNE: What do you call them?

OFFICIAL: White metals.

MR. J. BYRNE: White metals. Once we get that straightened away - there

seemed to be some concern with respect to the transportation costs but, with the

Waste Management Strategy and the gas tax now that is coming forward, what we

are hoping to do is put the money into capital so the towns won't have to do

that, to keep the tippage fees down in the long haul. It took a year or so to

negotiate this deal with the Federation of Municipalities. I have to give them

credit, that they agreed to do this. I thought it was great co-operation on

behalf of the Federation of Municipalities to come onside on this one, really,

because they are giving up a fair chunk of money. When you look at the gas tax,

a lot of the municipalities out there thought this was going to be a windfall,

but the gas tax has to be used for certain projects. What do you call it, green

projects, green...?

OFFICIAL: Green and capital.

MR. J. BYRNE: Green and capital projects. They can't take the money, if

they get a cheque for $5,000 or $10,000, and spend it in operations. They have

to build it up and use it for capital projects. Let's say a town spent

$150,000 on capital; they can't spend $145,000 this year and take the $5,000,

you know, replace $5,000. It had to be $155,000 this year, that type of thing.

So, it is not going to be the windfall that some people think it would be, but

when you look at regional sites such as this waste management or regional

co-operation, that is where all individuals, even those that are unincorporated,

will get the benefit from the gas tax, and they have to get benefit from the gas

tax on a per capita basis.

MR. LANGDON: Where are the white metals from Conception Bay North going

now?

MR. J. BYRNE: I think, from my understanding, there is a recycler out

there that collects them. You drop them off at a certain site out there and they

take them and recycle them. That would be a part of the overall plan at either

the Dog Hill site or St. John's. It will be a complete waste management site,

not a dump site. They will be into recycling. St. John's will probably be

getting into the blue box curb recycling program and it all hinges on - I would

say that study will be done, Baxter, by when? Some time late this spring?

MR. ROSE: It should be over the summer.

MR. J. BYRNE: Over the summer.

That is where that stands.

MR. LANGDON: The other thing that was a contentious issue for Conception

Bay North, of course, was the transfer station into Harbour Grace. Have you done

anything on that or not?

MR. J. BYRNE: When we put the committee in place, the new committee, or

the Waste Management Authority at that point in time, hopefully, the committee

will hopefully transfer into the Waste Management Authority when we get it

through the House type of thing. The transfer station is a possibility but has

not been finally decided yet. If we go down the road where we can have those big

compactor trucks, we may not necessarily have to have the transfer station, but

that remains to be seen.

MR. LANGDON: It is a district situation for me. The communities on the

Connaigre Peninsula: Harbour Breton, Hermitage, Sandyville, Seal Cove, and all

the communities down Fortune Bay North, they are looking at a site in Hermitage

that can be approved for all of the region, no doubt about that, a site that can

probably last for fifty years if need be.

On the weekend, I was talking to a number of mayors there. Is there any help

for these people if they were to come together to do that? Because that would be

the whole region. You can't bring it to Grand Falls; that would be three hours

away. They were looking for, in a sense, probably some help toward a compactor

or a piece of equipment that could be used on the site where they could maintain

that site and keep it presentable.

MR. J. BYRNE: That is exactly where we are going. When the plan was

originally put in place, it was to cut 240 dump sites down to eight, I think.

What I am saying is, it doesn't make sense - that is why we are going to tweak

it a bit - to take waste off the Northern Peninsula, off the Burin Peninsula,

off the Connaigre Peninsula, off the South Coast, and bring it up to Grand Falls

or whatever the case may be. We are looking at those types of things. Yes, there

would be money made available to assist in the purchase of vehicles and capital

outlays in the first place, if they are going to come together and have a

regional service. For example, now, down in Ramea, I think it was - was it Ramea

that was looking for an incinerator?

OFFICIAL: Yes.

MR. J. BYRNE: Because of having to take it off, put it on a ferry, bring

it in, and all these types of things....

What we are saying now - as a matter of fact, we recently had a meeting on it

- we want to, before we go down that road, require them, if they are looking for

an incinerator and it going to cost $200,000 to build an incinerator, we are

saying that maybe you might be better off spending $200,000 to look at something

different, because they are only going to have the incinerator until 2008, and

to spend $200,000 for such a short period of time is questionable. We were going

to look at putting some of our money into seeing what is best for that area. If

it is, I say, on the Connaigre Peninsula down there, to have a regional site,

then - it doesn't make sense to me to take waste from the South Coast of

Newfoundland and drive it all the way up to Grand Falls.

MR. LANGDON: My next question is Ramea. As you know, their incinerator is

gone, for all intents and purposes, so you are saying you might not put an

incinerator there but you will put some other form of -

MR. J. BYRNE: They want $200,000 for a new incinerator; that is what it

is going to cost.

MR. LANGDON: But it is only good for a couple or three years.

MR. J. BYRNE: Yes.

What we are saying, if that is the case, we could go and have a look at it

for them but we would rather do a little bit more work before we say yes to the

incinerator because there might be something that is more beneficial in the long

term to Ramea. Very recently we had that discussion and that will be followed up

very soon, I would imagine.

OFFICIAL: Followed up with the town, with the consultants, to look at the

options that are available.

MR. LANGDON: Okay, so we can expect something shortly, one way or the

other, on Ramea.

MR. J. BYRNE: Yes.

MR. LANGDON: Getting back to the gas tax, you were saying earlier that

the communities, of course, have to put their money towards some green project,

whatever that might be. Are you going to be taking any of the dollars off the

top from that particular amount that the communities would have, or the

communities would get the full amount and then they would make sure that those

particular dollars would go toward green projects, whether it is water and

sewer, waste management or whatever the case might be?

MR. J. BYRNE: The way the gas tax is going to be allocated is, it is

going to be 10 per cent off the top. There are 283 municipalities. Take 10 per

cent off the top, divide it by whatever that works out to be, and everybody

would get a cheque for that amount of money. After that, there would be 11 per

cent - what was the number for the waste management?

OFFICIAL: Waste management, close on 30 per cent, total. Starting out it

is 11.3 per cent.

MR. J. BYRNE: Eleven per cent in the first year. Then, what is left will

be distributed basically on a per capita basis and we will not take any - the

government - they will get all the money, but we had a lot of discussion with

the Federation of Municipalities with respect to how we would deliver this money

and there are two or three ways we could go about it. We could just give them a

cheque. We could give them a cheque with certain conditions that they had to use

it on certain types of projects, or they would give us a list to projects that

they would use it on, and/or we would administer it and say, okay, basically the

Municipal Rural Infrastructure Fund or the Canada-Newfoundland Infrastructure

Program.

The reason why we have to have some control on it is because, five years down

the road, if the federal government goes in and sees that some of these

municipalities are not using the money on the type of project that are supposed

to us it on, they could cancel the program. What we are thinking about doing now

with the federation is that we would - say the Town of Grand Bank are going to

get $10,000. We will say: Here is your $10,000; we want a list of the projects,

before we give you the money, that this will be used on. Down the road, if they

do not use it on those programs then they are going to be held responsible for

it.

MR. PARSONS: Just a few specific details.

On page 231 of the Estimates, line item 1.2.02., the amount budgeted last

year and what was actually spent shows an increase of $99,300.

MR. J. BYRNE: Wait now, 1.2 -

MR. PARSONS: Excuse me, page 232, under 1.2.02.

MR. J. BYRNE: Yes.

MR. PARSONS: Under 01., Salaries, there is $99,000, roughly, spent more

than was budgeted.

MR. J. BYRNE: Yes.

MR. PARSONS: The explanation for that?

MR. J. BYRNE: That was because there were three people retired, I believe

it was. Wait now.

OFFICIAL: We had severance.

MR. J. BYRNE: We had severance. We had people retire; we had summer

students in the program last year. There were three people retired, and money

had to go to pay off their severance.

MR. PARSONS: Is this a different type of policy now with regard to

severance? My understanding was that, if there were severance responsibilities

in a department, it got handled by Treasury Board as opposed to the departmental

expenditures.

MR. J. BYRNE: I think I will let Ramona answer that one.

MS COLE: Basically, what used to happen was that Treasury Board did have

some money available so departments, once they had paid their severance, could

request that it come from that pot, but once that money is all gone then it

stays with the departments. At this point in time, that money was all gone and

our department, unfortunately, was one of the ones that had to bear it

ourselves.

MR. PARSONS: Okay.

Again, you have gone back to $1,388,100 for salaries. I take it you are gone

back to what you roughly estimated for last year.

MR. J. BYRNE: Where are you now?

MR. PARSONS: The same one again.

MR. J. BYRNE: Yes, that is right.

MR. PARSONS: My question was intended to be: If you went more last year

than you had budgeted, why are you now gone back to a lower figure again?

Obviously, if it was due to severance, you are gone back to where you would

logically expect to be, I would think.

MR. J. BYRNE: Plus, there is a bit of an increase there because of the

salary increases that would start in effect this year.

MR. PARSONS: Subhead 1.2.03., the Administrative Support Capital section,

there appears to be an increase of $90,000 under Property, Furnishings and

Equipment, a fairly significant -

MS COLE: That is basically to provide two new vehicles for two of the

positions at the Fire Commissioner's Office and Emergency Measures, two of the

additional new -

MR. PARSONS: Thank you.

Under 2.1.01., on page 233, the Salaries heading, last year we had $834,800

budgeted, the actual amount spent was $760,000, a difference of $75,000. What

happened there?

MR. J. BYRNE: We didn't fill a couple of vacant positions during the

year. That is the decrease. Then it has gone up this year.

MR. PARSONS: Right.

MR. J. BYRNE: We are looking to fill a regional management position that

was not filled last year, also, so it will be topped up this year to get the

regional management position which just got approved in the Budget.

MR. PARSONS: Where will that be?

MR. J. BYRNE: Pardon.

MR. PARSONS: Where will that be?

MR. J. BYRNE: Eastern.

MR. PARSONS: Eastern region.

Under 2.2.01., page 234, the Policy and Planning section, under Salaries

again, 01.

MR. J. BYRNE: I am missing something here. Under 2.2.01, Policy and

Planning, okay. Which one?

MR. PARSONS: Under 01., Salaries, what was budgeted and what was actually

spent last year shows a $91,200 increase. What was the reasoning for the

increase?

MR. J. BYRNE: We hired an accountability and a transparency co-ordinator,

and we had an anticipated retirement that did not occur. We had somebody we

thought would retire and they did not.

MR. PARSONS: Okay.

Under that

section as well, 06., when you talk about purchased services, what

type of purchased services typically would we be dealing with here?

MR. J. BYRNE: I will let Baxter answer this, but I would say it would be

for, if you are having hearings for boundary expansions or changes, or towns

coming together, that type of thing - commissioners.

MR. PARSONS: The next

section down, 2.2.02., Urban and Rural Planning,

01., Salaries, a $53,000 increase in what was budgeted and what was actually

spent.

MR. J. BYRNE: Again, a person we anticipated would retire did not retire.

MR. PARSONS: This year you have budgeted an increase of $98,900, it looks

like, a fairly substantial increase. What is this?

MR. J. BYRNE: We have a planner who was transferred from Labrador and

Aboriginal Affairs to our department. We are paying for that.

MR. PARSONS: Engineering Support, 2.3.01, page 235, Salaries again: Last

year you spent $81,000 more than was budgeted.

MR. J. BYRNE: Yes. That again reflects the severance and vacation leave

entitlement for three employees who retired during the year.

MR. PARSONS: These positions of retirement, are they being filled?

MR. J. BYRNE: You are asking a good question there. Yes, they are being

filled but it seems to take a fair bit of time in the system to get people

replaced. Last year, of course, with those programs that we had to implement -

and I refer to Community Enhancement and crab workers and Harbour Breton and

Fortune - we had to take some of our staff within the department to implement

those. We are trying to backfill some of those positions, and we are getting

there. We will have to implement those programs again this year, and we probably

will be looking for some new staff. We have no choice, we have to backfill those

positions, but it takes time.

MR. PARSONS: I guess, from a general point of view, the question would

be: Is it the deliberate intention now of the department to downsize, or is it

the deliberate intention to stay where you are but it is a matter of the time it

takes to refill the positions? A couple of years ago we realized there were

significant cutbacks when it came to employees. Are we past that now?

MR. J. BYRNE: Most definitely. As a matter of fact, within our department

we had very few people who left or were let go. Right now, as I said, we have

three new people hired on with the EMO. I have three new staff hired within the

offices here. The regional manager is one of them. With the new programs that we

are implementing, we need to have a few more people hired to help administer

those programs. Our complement will be increasing, I would think, not

significantly but somewhat.

MR. PARSONS: The position of the former Deputy Minister of Fisheries and

Aquaculture, Mr. Samson, recently moved from that position to somewhere in the

EMO, I take it. That would be in your shop?

MR. J. BYRNE: He is now Deputy Minister responsible for Emergency

Preparedness, a plan across the Province which is going to take quite a bit of

time and effort to put together. It hasn't been determined if he is with my

department yet.

MR. OSMOND: He is actually attached to Executive Council. That is where

the position is located, so we won't see any of that reflected in our

estimates.

MR. PARSONS: So there is nothing here for his move. Was that a newly

created position?

MR. J. BYRNE: Yes.

MR. PARSONS: So if it is not in yours now, it would be in Executive

Council this year?

MR. J. BYRNE: Yes.

MR. OSMOND: Just to clarify: There was, I think, a press release on it.

The exact title is Deputy Minister responsible for Emergency Planning, as

opposed to emergency preparedness, in the EMO office. He is not responsible for

the operations of the Emergency Management Organization, but rather to conduct

an overview with regard to planning in the bigger picture, for emergency

planning in the Province.

MR. PARSONS: Maybe you can educate us a bit further here. What is the

distinction between emergency preparedness and planning for an emergency?

MR. J. BYRNE: The Fire Commissioner in the Emergency Measures

Organization is responsible for emergency preparedness. If there are disasters

such as the Stephenville flood and the Badger flood, he is the one who would

co-ordinate and put everything in place to respond. The Deputy Minister

responsible for Emergency Planning is to put a plan in place - say, for example,

if there is going to be a pandemic - to bring in all the government departments,

all the hospitals, all the airports, all the ports, whatever the case might be,

to put a plan in place. That is his responsibility, to put a plan in place for

future disasters. The Emergency Preparedness Co-ordinator, who is the Fire

Commissioner, would be responsible for implementing it once a disaster happens.

MR. PARSONS: What would be the logic of having, I would think, these two

very closely connected agencies, if you wish, being operated under different

departments? If you people already have the shop that deals with EMO, why would

we be now creating a second shop over under Executive Council? Why wouldn't we

put them all under the same umbrella and share some resources? At least you all

know what the other one's plan is.

MR. J. BYRNE: That could very well happen. This is something that was

done not long ago, and the Deputy Minister for Emergency Planning could very

well end up in my shop. In the interim, that is where his position is at this

point in time.

MR. PARSONS: Same section, Engineering Services, 2.3.01, item 03, an

increase of $50,500 for Transportation and Communications.

MR. J. BYRNE: That has to do with costs associated with the creation of

five temporary positions within the Provincial Waste Management Strategy.

MR. PARSONS: That is the travel and communications associated with those

individuals?

MR. J. BYRNE: Yes. That would be the Director of Waste Management,

Engineer III, two Waste Management Coordinators and secretarial support.

MR. PARSONS: What would be your anticipated split on that - you have

$137,800 total budgeted - in terms of how much for transportation and how much

for communications?

MR. J. BYRNE: Ramona, do you have an answer for that one?

MS COLE: At this point in time, that has not been specifically

determined. I would expect that a large portion of it would be for travel. It is

for the implementation of the Waste Management Strategy which would require a

fair bit of travel around the Province, obviously, to put that in place. The

actual split hasn't been determined at this point.

MR. PARSONS: Under the same section, 02 again. It is actually 02 under

the Revenue section, 2.3.01, but not the first 02, Employee Benefits, the second

02, Revenue-Provincial. There seems to be a substantial infusion here, about

$300,000, from federal sources.

MR. J. BYRNE: This is a reimbursement form the MMSB, Multi-Materials

Stewardship Board.

MR. PARSONS: What do you mean? Reimbursement for what?

MR. J. BYRNE: Costs associated with the creation of five temporary

positions. We had the five positions, the costs there, and the MMSB would

reimburse us for those salaries.

MR. PARSONS: Is that a usual transaction, that government has a program

and you get your funding paid for your employees by the MMSB?

MR. J. BYRNE: In this situation obviously. Could you answer that -

MR. ROSE: The implementation of the Provincial Solid Waste Management

Strategy is going to require a dedicated effort. The Estimates make provision

here for the hiring of five new people to carry on that work. Through the Waste

Management Trust Fund that is held at the MMSB, the MMSB has a component of

their budget which is dedicated to developing capacity, not only developing

capacity but to implement the strategy at the provincial level and also at the

regional level. If there are coordinator positions hired - operation of regional

waste management committees will be paid for by the MMSB in the various regions

and what not.

The MMSB is a significant funding partner in implementing the Waste

Management Strategy. In this case we are utilizing funds from the MMSB to get

the staff resources necessary to advance the strategy quickly and efficiently.

MR. PARSONS: I take it those five positions are in place as we speak?

MR. ROSE: The five positions aren't in place as we speak, they are

provided for in this Budget and we will be moving forward to get those bodies in

place to move the strategy ahead.

MR. PARSONS: Where will those bodies be working, on a provincial basis?

MR. ROSE: Here in St. John's and possibly in the regions as well,

depending upon how quickly the various regions advance. Right now the greater

Avalon Peninsula is moving ahead with a study of Robin Hood Bay. Central

Newfoundland is ready to move forward with an application for development of a

site.

MR. PARSONS: Item 2.3.02, page 235, 06, Purchased Services.

MR. J. BYRNE: That has to do with the transfer of the industrial water

supply system in Marystown to the town as of April 2005. There was an increase

in the rates also in 2006-2007.

MR. PARSONS: So the $447,000 for Purchases Services, could you explain

that again? Did you say Marystown?

MR. J. BYRNE: Yes.

MS COLE: That Purchased Services provides for operations related to

industrial water systems which government presently own and operate. We started

a process several years ago of trying to transfer those over to the towns in

which they are located. We transferred this one to Marystown just at the

beginning of the last fiscal year, so the actual Purchased Services required now

to operate the remaining ones is less. That is why it is down from the $560,000

budgeted to $478,000 on revised, because we transferred it early in the year,

and then down to $447,000, because now we no longer have that system so we don't

need to pay for the operation of that one.

MR. PARSONS: What will be included in terms of the services purchased?

OFFICIAL: Electricity would be a major cost, and to operate the pumps.

MR. PARSONS: So then, as a community if you are responsible for a water

system which has an electrical bill associated with it that would be a purchased

service that would fall under here?

MS COLE: This is just for the industrial water systems in those towns.

They generally feed fish plants and that sort of thing.

MR. PARSONS: Yes. How many communities do we still currently have that

government would be tied into in terms of these types of industrial water

services?

MS COLE: I think there are probably eight.

MR. J. BYRNE: I thought there were eight. It could be six or eight. That

is how many are left that the Province is responsible for.

MR. PARSONS: Is there a plan to ultimately make these -

MR. J. BYRNE: There are a couple now that we are negotiating with as we

speak, to take responsibility for the industrial water supply. It is not

something that we are forcing on them. Englee is one. They were in and met with

us not long ago, and they are after us to turn it over to them because they can

see that as a generator of revenue for them.

MR. PARSONS: 3.1.01, Municipal Debt Servicing, under the Grants

section

there, less was spent last year than was budgeted, to the tune of about $1.7

million. What is the explanation for this?

MR. J. BYRNE: Well, it was lower interest rates basically. Also, that is

to pay down the capital works debt which the Province has responsibility for, to

either lower interest rates now or as they come due we are paying off rather

than going out and borrowing again, so we will pay off the debt. That is the

reason why. That is what I understand it to be. Does that explain it properly?

MS COLE: Over in the Capital piece for that, you will notice that in last

year's Estimates we actually started to budget for the payout on those

projects when they were being capitalized rather than borrowing through NMFC and

incurring more debt. As the years go on now, you will see this amount gradually

decreasing until it gets down to virtually nothing.

MR. PARSONS: Same page, 236, item 3.1.02, Municipal Operating Grants,

down by $1.5 million: Given the current situation over the years it seems to be

quite a fuss by the communities and the federation that government has been

continuously, or regularly shall we say, decreasing the amount in MOGs. Yet, we

have a surplus situation in government and we still see these declining MOGs.

The rationale?

MR. J. BYRNE: To that point, we announced two years ago, I suppose, the

Budget before last, that we would decrease the MOGs by $5 million over three

years. This is basically the third phase of it, because of the difference in the

year ends for the towns versus the Province. I was hoping this year that we

might be able to not implement that cut this year, but we went ahead with it.

Next year I will be working on maybe not implementing the last phase of it which

will be approximately $1.5 million too.

MR. PARSONS: It is back again to the rationale, I guess. Three years ago,

or the first budget of this administration, we had a lot of things that were

planned and were going to take place over four or five years, but as indicated

by Minister Sullivan we have been very fortunate in terms of the revenue.

You are telling me that notwithstanding the substantial turnaround in the

fiscal picture in this Province, we couldn't see our way clear as a Province

to take $1.5 million and leave it into the MOGs. We can do things like $24

million in pay equity type situations, and we couldn't put $1.5 million - we

couldn't forego that cut.

MR. J. BYRNE: When you are looking at the big picture here, this money

that was cut impacted fourteen municipalities, and they are the larger

municipalities that had the wherewithal to compensate for this, but when you

look at the kind of money that we are talking about cutting, you take the City

of St. John's, for example, I think they were cut $900,000, which is a big

portion of the cuts. Yet, when you look at the big picture, the Municipal

Capital Works that was approved for them over three years is $21 million.

Even thought we are taking back a small portion, less than 1 per cent of

their budget, we are giving them $21 million to go towards the Municipal Capital

Works. There was no impact on any of the rural communities, and that was a

decision that I made. There were some people who thought that we should go

across the board two years ago and give everybody the same percentage cut. I

said: No, we cannot do that because $1,000 to a small rural community is like

$100,000 to the bigger ones.

Again, when you look at the big picture, anywhere from three quarters of 1

per cent to 1.1 per cent of the budget, that is how much that money impacted the

municipalities. On the other hand, we are giving all of those municipalities,

probably, or most of them, multi-year agreements, fifty-cent dollars, and they

are getting their money back big time. Plus, we are looking at ways that we can

allow those municipalities to have other sources of revenue. Some of the towns

are looking for the accommodation tax. The City of St. John's has it. We are

looking at other ways so that they can offset that loss plus the money we are

giving them.

MR. PARSONS: Is there any thought being given - some municipalities in

the Province, for example, are very fortunate in the sense that they do have

other means of revenue, they do have a good tax basis, versus a lot of places in

rural Newfoundland that are seeing some tough times. Is there any thought being

given to places like Lab City, for one that comes to mind, a fairly well off

type of community, and Mount Pearl and those types of places who would not get

any MOG because they are in a good financial position,

whereas you use that

money and put it in places that are having a tough time?

MR. J. BYRNE: I suppose. There have been no real discussions or decisions

made on that because we are looking at $17 million for MOGs in the long term, in

some of those places like you are talking about, probably, and there are others.

There are two or three others out there where you could consider that. I would

be fearful to go down that road and say that this town gets an MOG and that town

does not.

MR. PARSONS: We do a lot of things in the Province based upon a needs

basis.

MR. J. BYRNE: Yes, and there are other options that we could look at. I

have been having some discussions within the department to try and come up with

a way to have some debt relief for the municipalities in rural Newfoundland,

especially the ones that are in debt to the private banks.

The previous Administration had a debt relief program in that the towns were

indebted to the Municipal Finance Corporation. Most of those have been handled

now. There are still some that we are signing off on. As a matter of fact, there

are three on my list today that I have to sign off on.

To me, I am looking down the road that we might be able to come up with a

program to assist the municipalities with the debt relief, their debt to the

private banks. I think that is the next move, because some of them out there are

hurting big time. I understand that.

MR. PARSONS: Subhead 3.1.04., on page 237, Community Enhancement.

MR. J. BYRNE: Yes.

MR. PARSONS: I notice item 05., Professional Services, you spent $100,000

last year. There was nothing budgeted, but there was $100,000 spent in -

MR. J. BYRNE: That is the administrative cost to operate that. That would

be for, probably, salaries and that, but I will let Ramona (inaudible) or

Baxter.

MR. ROSE: The Community Enhancement Program, a lot of the costs you see

there for last year are related to us reacting to the circumstances in Harbour

Breton, for example, Fortune, the crab workers program, none of which were

budgeted but we had to respond and deliver programs, we had to develop computer

systems, we had to hire staff, engage some outside professional support services

to help develop the programs and the packages on the information.

MR. PARSONS: What types of professional services again? If you could be a

bit more specific?

MR. ROSE: One particular service required was a consultant who was

familiar with the federal programs and had experience in previous initiatives

such as TAGS, NCARP and whatnot.

MR. PARSONS: The Allowances and Assistance

section there, 09., you

injected $1.5 million in for this year where there was nothing last year. What

is anticipated?

MR. J. BYRNE: That is the money related to FPI. FPI was putting in $1.5

million and that is money there that we would basically be putting in place this

year in the 2006-2007 budget. That is to do with the salaries and the $5,000

cheques, those types of things. FPI had agreed to give $1.5 million for Harbour

Breton.

MR. PARSONS: Yes.

MR. J. BYRNE: It is only now, recently, that we received that, and that

money will be spent in this year because we did not receive it last year.

We, as a government, put in $1.25 million, was it? We were paying salaries of

people on different projects and that. We had a program put in place with

Harbour Breton, the FFAW and the town council down there, that the $1.25 million

and the $1.5 million would be spent on the workers from FPI. As time went by -

we could only access our $1.25 million. It is only recently we got the go-ahead

from the $1.5 million from FPI. That is the $1.5 million from FPI.

MR. PARSONS: You spent your money last year. That is reflected, I would

think, somewhere in your expenditures.

MR. J. BYRNE: Yes.

MR. PARSONS: My question is: Now that you have this $1.5 million budgeted

under Allowances and Assistance for 2006-2007, what are you going to do with it

for 2006-2007?

MR. J. BYRNE: In 2006-2007, that money -

MR. OSMOND: If I may just clarify that, the money was received late in

the fiscal year 2005-2006 from FPI. It was received then, but now we are going

to be spending it, if you will, and passing that money down to the population

during this fiscal year. It is just a question of a month or two; we lapsed over

into the next fiscal year.

MR. PARSONS: I am not too sharp when it comes to the math piece. Fill me

in here. You had these expenditures last year. I take it that you wrote the

cheques to some people.

MR. J. BYRNE: Here is what happened: Last year we had people working on

projects. We had to fund it ourselves out of the $1.25 million, so we were

funding them. We had an agreement with the FFAW that these people could get as

much as $14 an hour if FPI and the feds came onside.

MR. PARSONS: Yes.

MR. J. BYRNE: So we kind of gave them the $8.50 an hour last year. We

also had an agreement that these people could take - if the three of it had to

come together last year, you could have gone on the projects, get so much an

hour, or work for $8.50 and take a $5,000 cheque.

What is happening now, this is the money that we only received late in the

year. So it is $1.5 million, the FPI portion. Right now, in the new year, there

will be more projects. People will go to work for $8.50 an hour and take so much

money, or take a $5,000 cheque. This $1.5 million will be to fund that. It is

FPI money.

MR. PARSONS: The next section, Grants and Subsidies, you had $4.25

million there last year and it jumped up to $12.5 million.

MR. J. BYRNE: That is the Community Enhancement Program, which went from

$4.25 million to $6 million; the Crab Workers Support Program, on which we spent

roughly $5 million. What are the other two?

OFFICIAL: (Inaudible).

MR. J. BYRNE: Harbour Breton is $700,000, is it, or $800,000?

OFFICIAL: Fortune (inaudible).

MR. J. BYRNE: Seven hundred thousand in Fortune and $1.25 million in

Harbour Breton.

MR. PARSONS: So, all of the community enhancement projects around the

Province follow under here, that $12.5 million?

MR. J. BYRNE: Yes.

MR. PARSONS: Do you see this year, again - obviously there are some

trouble spots around the Province. I guess this year we have potentially a

greater need on the Burin Peninsula again, depending on what happens in the

Fortune, Marystown and Stephenville situation. The timing of the things: We have

always had a perennial problem of, by the time people get their projects in and

things get approved we find ourselves sometimes trying to cut brush in snow

storms and so on. When will your shop be opening so that communities - we know

the need is going to be there again. We have some areas - my area of the

Province, for example, is again perennially coming back to you people saying,

here are the needs again, but the names might change sometimes. When will you

shop be open again for consideration and approval of these projects?

MR. J. BYRNE: That has historically been a problem, late going in. I

remember the first year we formed the government it was in November and it was

after that the projects got approved. Of course, there was a late election. This

past year we have changed it to the Community Enhancement Program for that very

reason, that we could get projects approved earlier in the year. I think we

started taking applications this year in the later part of July or early August

and we had them approved in August, September and October, depending on when

they came in. We had some early approvals last year, and that is the objective,

of course, to get some long-term sustainability projects for the communities,

and it could even be carried over from one year to the next. So, we are going

down that road.

With respect to the amount of money: Last year we started out in the

Community Enhancement Program with $4.25 million. Then we got into the Crab

Workers Support Program and the demand was pretty high, as you mentioned. Even

though some of the people qualified under the Crab Workers Support Program and

they got the hours that we had committed to, they still didn't qualify for EI,

so we bumped up the Community Enhancement Program by $1.75 million to $6

million. Therefore, the people who then came off the Crab Workers Support

Program could qualify under this Community Enhancement Program so they could

qualify for EI.

We did that on an as-need basis last year with the commitment we made. What

is going to happen this year, we have $4.25 million in the Community Enhancement

Program. Will there be more needs this year? Possibly. We will have to address

them as they arise. That is all I can say to you at this point in time.

MR. PARSONS: Just so people understand the process: For example, last

year you had $4.25 million budgeted and you ended up over $12 million. When you

get those needs that develop like that and you have to go find the money, the

process is you obviously didn't have it in your budget because you didn't

anticipate that the needs would arise. The process of actually you, the

minister, going out for your department and finding the extra $8 million that

you need, where you do go look for it?

MR. J. BYRNE: First of all -

MR. PARSONS: Because obviously the spending approval is not there, you

haven't budgeted it.

MR. J. BYRNE: It is not budgeted for, no. Then we tried to come up with a

figure of what the need would be. Last year, when we looked at the Crab Workers

Support Program we took the worst case scenario and said, okay, we have x amount

of plant workers multiplied by the maximum amount of time they need, and it

worked out to be whatever it did. Right now, this year, say a plant closes or

whatever the case may be, we would have to come up with the numbers to try to

calculate what it is going to cost us. Then I have to go to Cabinet, and say to

the Cabinet that there is an extraordinary situation that needs x amount of

dollars for a program. Then, if Cabinet decides to approve it - which they did

last year pretty quickly - we have to go for - if the House is not open - a

special warrant. If the House is open, we would come here for a Supply Bill.

MR. PARSONS: That was done by a special warrant?

MR. J. BYRNE: I think it was a special warrant last year, wasn't it?

OFFICIAL: (Inaudible).

MR. J. BYRNE: Yes.

MR. PARSONS: I take it, rather than - my mindset was always waiting until

the fall for the Community Enhancement Program. That is not the case.

Communities who want to submit applications, once the fiscal year begins, they

are at liberty to put them in, and they will be at least in.

MR. J. BYRNE: When did we start to do it last year, the programs?

OFFICIAL: (Inaudible) applications in June and we started delivering

programs at the end of August.

MR. J. BYRNE: Basically, we accepted applications in June rather than in

November, and we had projects approved in July and August to start, which is a

big step forward, I think.

MR. PARSONS: Yes.

Subhead 3.2.01., page 237, item 10., Grants and Subsidies, about $1.5 million

less than was budgeted was spent.

MR. J. BYRNE: Basically, that deals again with the lower interest rates,

and changing the process.

MR. PARSONS: How do you mean, changing the process?

MS COLE: The change in the process, as we discussed, the current account

activity that relates to that is the interest portion and this is the principal.

Two or three years ago we changed the process whereby we now capitalize directly

rather than borrowing through NMFC, so this is the principal portion now that is

remaining on old debt. That will go down each year as we - there is no new debt

being added there.

MR. PARSONS: Okay.

Under the same section, actually, 3.2.02. on page 238, Federal/Provincial

Infrastructure, item 10., you spent $15.7 million less than was budgeted.

MR. J. BYRNE: It basically works out that Grants and Subsidies there, the

decrease reflects delays in approving projects from the federal government,

basically. That is why it is down. We were hoping to have the projects approved.

They did not get approved.

MR. PARSONS: What happens to the money?

MR. J. BYRNE: What happens to the money? We don't spend it. We don't

get it.

MR. PARSONS: You don't get it.

MR. J. BYRNE: It is carried over.

MR. PARSONS: For example, if the Province said last year, we have a

budget for infrastructure, in this case of $20 million and you only get to use

$15 million, then in the next year if your budget was going to be $20 million

but you got $25 million, it is not really an increase of $5 million. You are

just using in this year what you never used last year. It is an increase, but

what I am saying is over the balance of two years you still only spend the $40

million. Is that correct?

MR. J. BYRNE: Yes, that is correct.

MR. PARSONS: Speaking on the programs in general - and I raised this in

another forum and privately, I believe, with the minister - again my enquiry was

that I have had some concerns expressed by the municipalities that the process

might be delayed this year in terms of application processes. It was tried into,

I believe, a new process of your going online and filling out your applications

online and so on. There were some concerns expressed in my area that the actual

application and approval process might be delayed to the point where we are

going to see end-of-summer type approvals and working in the fall, as opposed to

where these communities would normally like to get their projects approved early

and have June, July and August type construction seasons. Are you anticipating

or have you seen so far any delays in your new process?

MR. J. BYRNE: Basically, we can have approvals right on through the year

at any given point in time. Right now, we have the online process. We have

applications in. We have over sixty-something, as we speak, in the new system.

We gave an extension until April 10 to have the applications in. Next week we

will be sitting down - as a matter of fact I asked by EA to send out an e-mail

to all MHAs requesting their input and their priorities. Once the list is in

next week we will start processing right away. There shouldn't be a delay. We

are hoping to speed up the process not delay it.

Do you have a comment on that?

MR. ROSE: The introduction of the online system is intended to ensure

better quality applications. We went through a municipal election last fall, we

had a lot of councillors change, a lot of new mayors. The priorities of the

towns have probably changed. We have been picking away at these projects over

the years and whatnot. So the time came when we needed to get an up-to-date

picture of what the infrastructure requirements were in the municipalities, what

the towns wanted, and where they saw the path forward into the future. We

utilized this online application as a means of getting accurate current

information and allowing for updates as we go forward. The application process

contains checks and balances as well that will allow us, when we get it, we will

have better quality applications, so that should expedite the process.

MR. PARSONS: A personal experience here. One of the particular municipal

administrators is a dear friend of mine, actually, and I tell him the problem is

not with government; the problem is the fact that he is computer illiterate. You

can't go on-line if you don't know how to use a computer. That is his

particular case.

What about the communities that are not on-line? I have numerous communities

that do not have access to on-line.

MR. J. BYRNE: We have sent a hard copy application to all of the

municipalities also. They can still do it on hard copy and then we probably

would transfer it ourselves.

MR. ROSE: There is one other addition to that. Most of the communities,

particularly the smaller communities that are, shall we say, less than totally

computer literate, they rely on their consultants, and we have put a significant

effort into working with the consulting community to ensure that they are

literate and they know how to utilize these systems. So, where towns cannot make

the applications themselves, we are hoping that the consultants will make the

applications on their behalf and we will get good quality applications.

MR. PARSONS: Item 3.2.03., page 238, Grants and Subsidies, that is the

gas tax piece there, the $15,800,000. I take it from your earlier comments - my

question was concerning the fact that we had $15.8 million,

whereas I understood

that we were actually getting about $19.8 million from the government, so we

have a $4 million different between what you have and what you spent here. Am I

understanding correctly that the difference of $4 million is going to be used by

you in the waste management area?

MR. ROSE: The $19.8 million is the anticipated revenue from the federal

government for the first two years of the gas tax agreement. We anticipate

getting last year's money and this year's money in the current budget. The

$15.8 million is our estimate of what will flow to the municipalities. The

remaining $4 million will be available for municipalities, but we anticipate

that there are going to be requirements for development of agreements, and

accountability measures built into those agreements, and not all towns will

necessarily have agreements signed up, have projects selected, and have

identified those to the minister.

MR. PARSONS: Just rewind me a little bit here. Given your comment that

you are going to get both last year's and this year's in the same budget,

are we talking $39 million, roughly, versus $19.8 million?

MR. ROSE: No, it is $9.9 million per year for the first two years, and

then the number goes up to $13.2 million and continues on upwards.

MR. PARSONS: So, the $15.8 is the doubling; that is the two years put

together.

MR. ROSE: That is two years' money together.

MR. PARSONS: I seem to recall hearing this past Friday, actually, March

31, on VOCM, there was some comment being expressed by the Federation of

Municipalities as to the gas tax piece, the status on the agreement. Actually,

the Federation's president was on, calling on government for further details.

What is this all about?

MR. J. BYRNE: I do not understand that, because we have been in complete

consultation with the Federation of Municipalities. As a matter of fact, they

put out a release last week saying that the budget was a good budget, very

positive. It was only last week that I spoke with the president and he did tell

me that there were some comments to the media recently that were not quite

accurate. They are quite happy with what we are doing, and basically he was

inquiring if we had finalized the distribution formula, I suppose. Is that the

right way of putting it?

OFFICIAL: (Inaudible).

MR. J. BYRNE: Delivery. They wanted us to do a certain delivery program.

There was a consensus. There was no problem. I do not understand why that would

have been done, really, or said.

MR. PARSONS: Has there been any follow-up to find out what he is talking

about? You are dealing with the Federation. I assumed there was a deal and

everything had been worked out, and now we have a man, three days ago, after

your budget, questioning the details.

MR. J. BYRNE: There is a deal worked out with respect to the allocation,

the 10 per cent off the top, the money for waste management and then the per

capita. The only thing he was wondering, if it was finalized, was how we were

going to distribute the money to the municipalities.

As I said earlier, there were three ways we could go. The middle one was that

we would give them a cheque with conditions that they would have to sign off on,

that the money would be spent on certain projects.

MR. PARSONS: Mr. Ralph is the current -

MR. J. BYRNE: Wayne Ruth.

MR. PARSONS: Ruth, rather.

Under subhead 3.2.04., you talked about Community Development - Coastal

Labrador, 05., Professional Services. What kind of professional services are we

talking about there? There was $1.7 million budgeted, you spent $943,000, and

again this year you have budgeted $718,000. What kind of professional services

would you be purchasing there?

MR. OSMOND: I would assume that they relate to just engineering

consultants and that sort of thing. These are actual water and sewer

infrastructure projects, so my thinking would be that would relate primarily to

engineering services.

MR. PARSONS: Under 4.1.01., on page 240, the Salaries heading increased

by $91,300. What does this increase represent? You went from $340,000 budgeted

last year to $439,000.

MR. J. BYRNE: Overtime costs.

MR. PARSONS: So you anticipate, in the Fire Commissioner's Office for

the forthcoming year, overtime already anticipated?

MR. J. BYRNE: No. I am looking at - that is the increase for the fire

protection officer, a new position.

MR. PARSONS: So that is a new position?

MR. J. BYRNE: Yes.

MR. PARSONS: What did you call it?

MR. J. BYRNE: Fire protection officer. That is something that the fire

chiefs and firefighters have been looking for, for years, with the Fire

Commissioner's Office, and we got it approved this year.

MR. PARSONS: Where would this person be stationed?

MR. J. BYRNE: That would be up to the Fire Commissioner. I did ask him

that, and he said that it is starting out maybe in St. John's but could quite

conceivably be in Clarenville.

MR. PARSONS: Who is the current Fire Commissioner?

MR. J. BYRNE: Fred Hollett.

MR. PARSONS: Where does Mr. Hollett live now?

MR. J. BYRNE: He lives in St. John's.

MR. PARSONS: Under 4.1.02.01., Salaries, an increase again of $58,700.

MR. J. BYRNE: One regional emergency measure management officer. That is

one of the three positions that we talked about earlier, and one DFAA co-ordinator,

two positions.

MR. PARSONS: Are these two going to be in the capital city region again?

MR. J. BYRNE: That depends on where the Fire Commissioner wants to put

them, and where he feels it would be best qualified to have those people best

situated.

MR. PARSONS: Under 4.1.03., Fire and Emergency Services, Joint Emergency

Preparedness Projects, item 10., Grants and Subsidies, an increase of $102,000.

MR. J. BYRNE: Well, actually, they had a decrease. Is that what you are

talking about? It was budgeted $282,000 and it went down to $180,000 this year

and went back up to $282,000.

MR. PARSONS: Yes.

MR. J. BYRNE: That is because there were fewer applications under the

JEPP program, the Joint Emergency Preparedness Projects.

MR. PARSONS: Right.

MR. J. BYRNE: That is a federal government program, and there were just

fewer applications.

MR. PARSONS: Under the Revenue-Federal section, the amount of $282,000

you anticipate being provided by government?

MR. J. BYRNE: Federal.

MR. PARSONS: From the federal government?

MR. J. BYRNE: Yes.

MR. PARSONS: That is a guarantee, is it?

MR. J. BYRNE: It is a guarantee if we have that amount of money applied

for, for $282,000. If we only get applications for $100,000 or $150,000, that is

all we get. We only get what is applied for and approved.

MR. PARSONS: I am just comparing the two comments. If you look at that

section 4.1.03, that we are dealing with now, the last sentence in the

paragraph, the explanation piece, says, "Expenditure are fully recoverable

from the federal government." Then down in the next section, 4.1.04, the

last sentence says, "These expenditures may be partially recovered from the

federal government." So there is different criteria, I take it.

MR. J. BYRNE: That is the disaster financial assistance arrangement, I

would say.

MS COLE: The first one, the Joint Emergency Preparedness Projects, is a

very specific program which provides for emergency type expenditures, which are

cost-shared 50-50 by the federal government and the towns. They basically said

to us: Okay, the share for Newfoundland is $282,000. If you can give us projects

from your towns totaling $282,000 we will give you that portion as our 50 per

cent share. The next one down is for the responses to, like the Stephenville

flood and that sort of thing. They are two entirely different programs.

MR. PARSONS: Any speed up in the processing of the disaster assistance

programs?

MR. J. BYRNE: I think we are still waiting on money from Badger and

Gabriel.

MS COLE: Yes, the federal government has to go through a lengthy audit

process on these expenditures before they will give us the money, which is why

we actually have a DFAA coordinator approved. Hopefully, that person will be

able to push that process along. We are still owed I think about - is it $12

million Wayne?

MR. MOORES: $12 million.

MS COLE: About $12 million related to tropical storm Gabriel, Hurricane

Louise, and one other one.

MR. PARSONS: Back in the last century?

MS COLE: Yes. It is a slow moving process but we will get their

eventually, I am sure.

MR. PARSONS: Just a couple of general questions.

Minister, was there any polling done by your department throughout the last

fiscal year?

MR. J. BYRNE: Any polling by my department? Not that I am aware of.

MR. PARSONS: I notice you have a Communications Director or Assistant.

Where is that reflected in the Budget, the cost?

MS COLE: I believe it is in the Minister's Office, Salaries. I will

have to check that for you. It may be under Executive Support. It is in one of

those two places.

MR. PARSONS: I notice in some departments, like in Justice for example,

under Administration in the Minister's Office, it specifically says Director

of Communications. It doesn't say that in the case of your department.

MS COLE: No, it is under Executive Support actually in our department. It

is not shown there in the activity description, but that is where the funding

is.

MR. PARSONS: Where would it fit again? Executive Support?

MS COLE: Under Executive Support, Salaries.

MR. PARSONS: Salaries?

MS COLE: Yes, 1.2.01.01.

MR. J. BYRNE: It is within that $537,000 I would thing, is it? It is not

broken up, so it would be within that Salaries, $537,000?

MS COLE: Yes.

MR. J. BYRNE: Yes.

MR. PARSONS: Mr. Langdon has a couple of questions.

MR. LANGDON: Going back to the position that my colleague asked you about

for the Fire Commissioner's Office, you are saying it is possible Mr. Hollett

would have it in St. John's, but possibly in Clarenville?

MR. J. BYRNE: Yes, a Fire Protection Officer.

MR. LANGDON: Why would the person be in Clarenville? Have you already

selected the person?

MR. J. BYRNE: Oh, no, no, no. That is only approved, they haven't been

hired yet. They are not filled. These positions aren't filled.

MR. LANGDON: Yes, I know that, but Clarenville is so close to St. John's,

why not Gander or Grand Falls or Corner Brook or whatever?

MR. J. BYRNE: Ramona.

MS COLE: The Fire Commissioner's Office presently has four Fire

Protection Officers. Two of them are in Deer Lake, one is in Central

Newfoundland in Grand Falls, and there is one in St. John's. They have, over

the years, constantly looked for additional support for the Eastern Region,

which includes St. John's but it also goes out as far as Clarenville. The

thinking is that if we get the additional position approved for the Eastern

Region it may be better to have that person located the other end of it, so that

the people from St. John's, when there is a call for a fire investigation or

for training in that area, we don't have the travel related to going from St.

John's out. It may be better to have somebody at each end and then they can

sort of deal with the whole area a little bit better, more efficiently.

MR. LANGDON: Going back to the Municipal Debt Servicing, as you said when

we were there we had a number of the communities who financed with the Municipal

Financing Corporation. Considering the fact that many of these smaller

communities have seen decreasing populations through natural cause and out

migration, not necessarily out of the Province but into the larger urban areas

or whatever, are any of these municipalities that were restructured for debt

purposes, are any of them now having further complications?

MR. J. BYRNE: We have been following that very closely, the financial

division within the department, and actually now when they apply for projects,

for water and sewer and these types of things, we are trying to keep their debt

servicing ratio at around 30 per cent and below, because some of them were up

around 40 per cent and 50 per cent, and one or two were higher than that. I am

not aware of any of them having gotten into financial difficultly. We watch it

pretty closely, but I could refer back to -

OFFICIAL: Out of the group that we provided debt relief for, over the

past six or seven years, there have been probably three or four who are

experiencing some difficulty but it is not a big issue and we are working with

them. We have actually gone back to NMFC and sort of refinanced within NMFC

sometimes to help those out, but it is not a major problem and we are dealing

with it. We are working with those communities on a regular basis to deal with

those issues.

MR. LANGDON: Okay, so if I can probably paraphrase what the minister

said, you are looking at their debt levels to make sure that they do not go

above a certain level. What does that do, then, for that municipality who has

infrastructure needs and cannot afford to pay their portion? What do you do

then?

MR. J. BYRNE: Again, if it is an environmental issue or a health issue,

we will go in and try and fund it as we have done in the past. It could be 60

per cent or 70 per cent or 80 per cent of the funding to keep their debt to a

minimum. We just do it on an as-needed basis, on an individual basis, but we are

trying to keep their debt to 30 per cent and below, but we have gone above it

when it is really, we feel, required.

MR. LANGDON: Okay.

Then you are saying - and they were there when I was there a few years ago,

too - the fact that some of the municipalities who had gone to the banks for

refinancing and so on, they were experiencing some difficulty. I would imagine

that some of these communities are still in that category. What are you planning

to do for these?

MR. J. BYRNE: Well, as I said earlier, my plan is, in due course, that we

get a program in place similar to the debt relief program that was involved with

the Municipal Financing Corporation, and then deal with the towns that are

borderline bankrupt, I suppose, and try and deal with those in the long haul.

Again, we have had discussions with the Federation of Municipalities, Herb

Brett, the previous president, and the present president, to try and come up

with a program that would involve the MOGs, or ways to give them more money with

respect to taxes or taxation, or just a general program where we would finance

the debt in the long term. It is something we are working on within the

department. It has not be finalized, but we are getting there.

MR. LANGDON: Okay.

Another problem area for the department, according to the Auditor General,

seems to be the Municipal Assessment Agency not having timely inspections, and

these things and whatever, and I understand that, after being in the position

that you are.

It would seem that there is criticism from the smaller municipalities, the

same now as it was when I was in your position a few years ago, that they figure

they are not getting the best bang for their buck and the services are too high.

Is the department working with the municipal agency to see if you can,

through some way or other, reduce these costs, especially for the smaller

municipalities?

MR. J. BYRNE: As you know, the Municipal Assessment Agency is really a

body that is arm's-length from government. We have representation from the

Federation of Municipalities, the various municipalities around the Province. We

have representation on it. Sometimes, I even wonder why we have representation

on the Municipal Assessment Agency, because if something goes wrong government

is probably going to be held accountable for it. They are an arm's-length

body. That is what they wanted at that point in time.

With respect to the rates, again, we have the same complaint that you had

when you were there: every five years, the time delays and these types of

things, to have the assessments done. Really, further to that, for us to go in

and say to the Municipal Assessment Agency that you have to cut your rates or

whatever, we have not done it. I do not see us doing it. I don't know if

anybody wants to add to that.

MR. LANGDON: Again, in the Auditor General's report - I know how these

work, too - he was somewhat critical of a situation, I think, where the

municipal agency's annual general meetings were in Whitehorse. I think he is

saying here that the agency has adopted government's travel policy; we find

instances of non-compliance. For example, during the period May, 2003, to

January, 2004, air fares and meals for spouses of board members and employees

totalling $1,930 was claimed, and business lunches and so on.

I know it is, in a sense, arm's-length from government, but you are

responsible for it. We realize that. I am just wondering, if these things are

happening then obviously the department should deal with the chair and the

people who are operating that agency.

MR. J. BYRNE: On that point, though, I do believe that the Municipal

Assessment Agency realized that they certainly erred in that situation and they

paid the money back in that given situation.

Again, it is an arm's-length body. They should adopt the policies of

government. We have told them that. What is his name?

OFFICIAL: Sean Martin.

MR. J. BYRNE: Sean Martin.

Yes, I agree with you, they made a mistake and they corrected it. Hopefully,

they will avoid it in the future.

MR. LANGDON: Yes.

So, it is the same situation where other expenditures like golf fees, $907,

liquor for board conferences, Christmas dinners for board people, including all

of their spouses, $4,000, you have addressed all of these things with Sean?

MR. J. BYRNE: I think that will change in the future.

MR. OSMOND: If I may, if I recall the report, these reimbursements, if

you will, in fact, took place before the Auditor General did his review, so the

matter had already been self-corrected before the Auditor General actually

reported on it.

MR. J. BYRNE: That does not alter the fact that it should not have

happened, and it should not happen again.

MR. LANGDON: What that does, even though they are an independent agency,

it makes it more difficult for you, as a minister, in a department of

government, to be able to say to small municipalities, who feel they are being

overcharged on assessment, that these things are happening to their dollar.

MR. J. BYRNE: Well, what can I say on that one? Again, they are arm's-length.

They went and did it. They corrected the problem before the Auditor General went

in. Again, it is a system that was put in place prior to us getting here. Do we

want to change it at this point in time? I do not know if the municipalities

would want us to change it and bring it back to government. I have not had any

requests along those lines.

MR. LANGDON: The other thing I am talking about is the capital works

program, like Canada-Newfoundland infrastructure, municipal works, and all of

these things. Are there any programs within the department now - I know a few

years ago, when we had the problem with the drinking water, we had provided 100

per cent grants to the municipalities, up to $100,000, for them to improve their

drinking water systems. Is that still there?

MR. J. BYRNE: You are talking about the Disinfection Assistance Program.

MR. LANGDON: Yes, the disinfection program. That is not there any more,

is it?

MR. J. BYRNE: No, that is not there at this time; but, again, we work on

that on an individual basis. If a town comes forward and they do have a problem,

we work with them, as you know, and try to correct any problems as quickly as

possible, especially if there are any health or environmental concerns.

MR. LANGDON: I understand.

So it is possible, if somebody was in a real emergency, they could still come

to the department and look for that?

MR. J. BYRNE: Oh, yes.

MR. LANGDON: On the industrial water systems, you are saying that we have

eight still left.

MR. J. BYRNE: It is either six or eight, now, off the top of my head.

MR. LANGDON: Six or eight, whatever.

One of the towns that you were mentioning was Englee. I remember, when I was

there, the town came to me many times and said that they would be willing, in a

sense, to probably take the industrial water system, but they felt that the

system that had been put in for them coming down the brook was not properly done

and there were all kinds of instances where we had to send cameras up because

the pipes were not aligned fair and so on. Has that been corrected so that the

town can now take it over?

MR. J. BYRNE: As far as I understand. It was only a few weeks ago that I

had a meeting with the mayor and they were asking us to actually take it over.

We had engineers look at that a number of times, and the problem has been

corrected?

OFFICIAL: There have been upgrades made to the system.

MR. LANGDON: There have been upgrades made?

MR. J. BYRNE: Yes.

MR. LANGDON: One of the other towns that were having problems was Comfort

Cove. Are they still on the industrial water system or are they off, or is that

one that you are actively looking at?

MR. J. BYRNE: I would have to check it, to be honest with you. I can't

recall, off the top of my head, if it is one of the six.

MR. LANGDON: One of the others things that, of course, people were

looking for when I was there, and I guess they still are now, is the 911. Where

is 911?

MR. J. BYRNE: It could be a valid idea for the Province to have an

emergency 911 system. Of course, the age-old problem with respect to a

comprehensive list of the street addresses in rural Newfoundland is problematic.

Back in 1996 there was a study done, a projection, that it would cost, I

think, $10 million back at that point in time. It was only recently - since

Christmas, actually - we had meetings, representatives from within the

department had meetings, with a telecommunications firm to have a look at that.

I think about a year or a year-and-a-half ago we did have some previous

discussions with a telecommunications firm. There was nothing concrete come

forward from the people who were interested at the time.

Again we will come back to, I suppose, the logistical problem of a list of

addresses, especially in rural Newfoundland, because we have all those nooks and

crannies in those communities, and the cost. We would have anticipated that the

people we were talking to might come forward with some kind of a cost to show us

what it could cost to implement a system Province-wide.

MR. LANGDON: I understand that, with the communities scattered all over

the place, but how many communities have 911 now?

MR. J. BYRNE: The Avalon and the West Coast, Corner Brook, is it?

MR. LANGDON: All of the Avalon?

MR. J. BYRNE: No.

MR. LANGDON: Northeast Avalon?

MR. J. BYRNE: The St. John's are.

MR. LANGDON: St. John's, Paradise, CBS.

MR. J. BYRNE: No change since you have been there.

MR. LANGDON: Nothing has improved since that?

MR. J. BYRNE: Not that I am aware of.

MR. LANGDON: There must be some situations, though - you can't do all

the Province, I understand that, with many of the smaller communities with no

streets and numbers and all of that stuff, but there have to be some

municipalities like, for example, Bay Roberts or Carbonear or Botwood or Bishop

Falls, that do have street numbers and names and so on. So, rather than doing it

all Province-wide, you might be able to do it incrementally.

MR. J. BYRNE: Again, that is a possibility, but that in itself could

present logistical problems. I am not a professional or know the ins and outs of

that. We will leave that to a telecommunications firm who we thought might come

forward with a package to us to look at all aspects of implementing a 911

system.

MR. PARSONS: I have one other question that concerns the Municipal

Assessment Agency again.

MR. J. BYRNE: Yes.

MR. PARSONS: From my reading of the Auditor General's report there

seems to be not only these particular issues that my colleague referred to in

terms of expenditures, but the whole process of this agency not assessing

property values in a timely, complete and consistent manner; nearly half of the

20,000 properties sold during the period of 2002-2005 never inspected; 74 per

cent of inspections did not include an interior inspection of the property; lack

of guidance provided to assessors. All of this impacts upon, ultimately, the

revenue that these municipalities collect.

I am a little bit shocked, I guess, in your comments as to what is being

done. We obviously have here a very important agency, albeit arm's-length from

the government, that is not working. It is seriously, seriously, dysfunctional.

What process is in place to try to fix this?

MR. J. BYRNE: The point you make with respect to interiors not being

inspected, I have been in my home for thirty years, the town has been

incorporated for twenty, and there has never been somebody from the Municipal

Assessment Agency ever inside my house. That has been something that has been

ongoing for years and years and years. The points that you make have been

ongoing for years and years and years. It could be addressed.

I think that, again, when you have the municipalities out there that are

complaining about how much they are being charged, there is a certain amount of

staff and a certain number of homes that have to be inspected and assessed. If

you want to put the staff and hire the staff, it could be done, but I expect the

rates would have to go up unless you change the system completely and have some

other form of taxation other than property assessment. That could be looked at.

To me, unless they want to agree to staff up, up the rates and address the

concerns, these are problems that have been inherent in that system since day

one.

MR. PARSONS: I guess where I am coming from here is, we all know the

problems are there.

MR. J. BYRNE: We can address it.

MR. PARSONS: Yes, we are on your watch now. My question simply is: What

is being done on your watch regarding the Municipal Assessment Agency to address

the problem?

I agree with you, it is a very difficult problem. I agree with you, it is

very complex. I agree with you, it has been long-standing. I guess the nature of

my question is - and I am not trying to be difficult - is there any process or

assessment in place? Rather than just have the AG give us a report and say this

thing is dysfunctional, have you set up any parameters to try and fix it?

MR. J. BYRNE: Again, I have to repeat what I just said, we could, I

suppose, address it very quickly and give them the wherewithal to staff up, get

more people employed, and then concurrently put up the rates that they are

charging municipalities. That is not going to work. Again, we could sit down, I

suppose, as a department, with the Municipal Assessment Agencies and see what

they could do to improve the process.

MR. PARSONS: That is what I am getting at.

Is there anybody in your department specifically tasked, as a result of the

Auditor General's comments, to communicate with and come up with some kind of

action plan to deal with the concerns that the AG has raised, or are we just

going to continue to identify the problems and we find ourselves back here in a

year, or two or three years' time, looking at more AG's reports about the

Municipal Assessment Agency and no corrections?

MR. J. BYRNE: You make a good point.

Again, it has been ongoing, as I said, for years. It is something that does

need to be addressed. They have corrected some of their problems over there. I

will take your advice and certainly investigate it further.

MR. PARSONS: Thank you.

I have no further questions.

CHAIR: Are there any other questions from the Committee?

Mr. Felix Collins.

MR. F. COLLINS: Just a quick question, Mr. Minister.

The MOGs, is there a bottom minimum amount that a small community gets? You

mentioned earlier that there is no across-the-board reduction, and the bigger

reductions come from the bigger communities. The small communities, if they are

already at a very low level of operating grants, is there a minimum which they

go to, or do they (inaudible)?

MR. J. BYRNE: With respect to Municipal Operating Grants cuts, there are

fourteen municipalities that are impacted by these cuts. The rest of the towns -

say 170 other municipalities - are not impacted by these cuts at all,

whatsoever, and there is a formula that has been ongoing for a number of years

to determine how much money a town gets on their MOGs. The towns have been

frozen for at least five or six years, the amount of money that they have been

getting, other than the fourteen municipalities that were impacted last year and

this year.

MR. F. COLLINS: Okay.

Thank you.

CHAIR: Any further questions?

If not, I will ask the Clerk to call the subheads and we will do them in an

inclusive manner from beginning to end.

CLERK: Subhead 1.1.01. to 4.1.04.

CHAIR: Shall subheads 1.1.01. up to 4.1.04. carry?

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

CHAIR: Carried.

On motion, subheads 1.1.01. through 4.1.04 carried.

CHAIR: Shall the total carry?

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

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.

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

amendment.

CHAIR: Thank you.

There is one item of housekeeping that we have to clear up from last night,

and that is to pass the minutes from last night. The copy that was distributed

shows that Yvonne Jones was a member of the Committee and Mr. Collins was also

present. That should actually be reversed. The sharp eye of the Clerk picked

that up. Her official copy has Mr. Collins as the member of the Committee and Ms

Jones being also present.

With that correction noted, I would ask for a motion to adopt the minutes

from last night.

MR. F. COLLINS: So moved.

CHAIR: Moved by Mr. Felix Collins, seconded by Mr. French.

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

CHAIR: Carried.

On motion, minutes adopted as circulated.

CHAIR: I would like to thank the members of the Committee for being

prepared and for their questions this morning. I thank the minister for his

forthright answers, and the staff for their normal degree of professionalism.

This Committee will reconvene tomorrow at 9:00 a.m.

MR. J. BYRNE: Mr. Chair, may I make a comment?

CHAIR: I am sorry.

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

Basically, thank you for being here. I would like to thank my staff for being

here this morning and answering the questions for further information for the

Committee. I would like to thank the Committee for their questions, the

protocol, and the way they carried themselves this morning - very civil, as we

should be. Sometimes in the House of Assembly we get carried away but this was a

good meeting, I thought.

Thank you.

CHAIR: We will reconvene tomorrow at 9:00 a.m. to consider the Estimates

of the Department of Health and Community Services.

A motion to adjourn, please?

MR. O'BRIEN: So moved.

CHAIR: Moved by Mr. O'Brien.

All those in favour, aye'.

SOME HON. MEMBERS: Aye.

CHAIR: We are adjourned.

On motion, the Committee adjourned.